Sara A. McGregor

The plaintiffs brought a motion for penalty after the defendants were found in civil contempt for breaching a Mareva Order by placing a mortgage on a property and collecting rent.

The plaintiffs sought a 120-day term of imprisonment and the striking of the defendants' pleadings.

The court declined to order imprisonment, finding it disproportionate to the discrete acts of contempt.

Instead, the court ordered the defendants to pay a $35,000 fine and outstanding costs of $15,474.32 within 60 days, failing which their statement of defence and counterclaim would be struck.

The Plaintiffs brought a motion for contempt against the Defendants for breaching a Mareva Order and a Continuation Order.

The Defendants had encumbered a property, which was subject to the orders, with a mortgage and dissipated rental income without informing the Plaintiffs or their own counsel.

The Defendants argued they acted innocently and that the Mareva Order was obtained with "unclean hands." The court applied the three-part test for civil contempt, finding that the orders were clear, the Defendants had actual knowledge, and their actions were intentional.

The court rejected the Defendants' explanations as incredible given their real estate experience and found them in contempt beyond a reasonable doubt.

The court ordered an accounting and tracing of funds and scheduled a hearing for remedies.