COURT FILE NO.: F484/09

DATE: January 11, 2013

SUPERIOR COURT OF JUSTICE – ONTARIO
FAMILY COURT

RE: Lynette Sharon Williams, applicant

AND:

Bryan John Williams, respondent

BEFORE: MITROW J.

COUNSEL: Wendy Trieu for the applicant

Bryan Williams in person

HEARD: November 14, 2012

ENDORSEMENT

INTRODUCTION

[1] There are two motions before the court as follows:

a) The motion brought by the respondent, Bryan John Williams (“Mr. Williams”), initially returnable October 24, 2012, where Mr. Williams seeks to vary, on an interim basis, child support provisions contained in the final order of Nolan J. dated June 15, 2011 (hereinafter referred to as the “existing order”) by recalculating his child support for 2011 based on his alleged 2011 income of $36,153, rather than the income of $45,000 imputed to him by Nolan J. Mr. Williams also claims his 2012 income has dropped to approximately $20,000 annually and he seeks a further reduction in child support for 2012. Mr. Williams asks that his arrears be reduced accordingly, that his arrears payment be set to $50 per month and, finally, he asks that his driver’s licence be reinstated. (There is, in my view, no jurisdiction to make the order regarding the driver’s licence. Also, there is no indication the Director was served.)

b) The motion brought by the applicant, Lynette Sharon Williams (“Ms. Williams”), initially returnable October 24, 2012, seeks an order dismissing Mr. Williams’ motion to change issued June 27, 2012 or, alternatively, staying the motion to change until Mr. Williams pays his child support arrears of over $16,000 and costs of $1,160 and $4,294, respectively, pursuant to the interim order of Vogelsang J. dated May 31, 2010 and the trial costs order of Nolan J. dated September 9, 2011. Alternatively, Ms. Williams seeks $8,500 as security for costs.

[2] For reasons set out below, Mr. Williams’ motion for interim relief is dismissed and Ms. Williams’ motion is granted, in part, by ordering a stay of Mr. Williams’ motion to change with the stay being subject to terms and conditions as set out below.

BACKGROUND

[3] The parties were married to each other in 1999 and divorced pursuant to a divorce order dated April 5, 2011. (The divorce order dissolved the marriage only and contained no other corollary relief orders.)

[4] The parties have three children: Emmersen (born June 6, 2001); Michael (born April 15, 2004); and Ethan (born January 1, 2006).

[5] Pursuant to the existing order made after a three day trial, custody of the children was awarded to Ms. Williams and Mr. Williams was awarded access (the regular schedule being each Wednesday overnight and two weekends per month).

[6] In relation to child support, Mr. Williams was ordered to pay $881 per month starting January 1, 2011, being the table amount for three children based on an imputed income of $45,000. Child support arrears were fixed at $6,800 payable at the rate of $100 per month. Mr. Williams was also ordered to pay $116 per month towards s. 7 expenses (consisting of medication and dental care for the children), said amount representing 70 percent of the total cost and based on Mr. Williams’ income of $45,000 and Ms. Williams’ income of $20,000.

[7] By order dated September 9, 2011, Nolan J. ordered Mr. Williams to pay to Ms. Williams costs fixed in the amount of $10,735, with 60 percent of those costs being enforced by the Family Responsibility Office.

MR. WILLIAMS’ MOTION TO CHANGE AND HIS MOTION FOR INTERIM RELIEF

[8] Nolan J.’s reasons for judgment provide some context to Mr. Williams’ motion to change and his motion for interim relief. The reasons for judgment are extensive (24 pages). Mr. Williams was self represented at trial.

[9] In relation to custody/access matters, Mr. Williams’ request for joint custody was soundly rejected. Aspects of his conduct in relation to custody/access issues were criticized by the trial judge. Mr. Williams’ position on access was found by the trial judge to be focussed more on Mr. Williams’ needs, rather than the children’s needs and their best interests.

[10] On the issue of child support, it is quite apparent from the reasons that the quantification of Mr. Williams’ income was the major issue. Mr. Williams, then and now, derives his income from his self employment as a sports photographer. It was quite apparent from the reasons for judgment that Mr. Williams’ conduct, in failing to make full financial disclosure, contributed to confounding the issue. The trial judge’s findings included the following:

a) Mr. Williams’ evidence at trial was often unclear as to financial issues, he did not have a good understanding of the law and had little appreciation for the nature of evidence he needed to provide (see para. 49 of the reasons);

b) By the time of trial, Mr. Williams had not yet produced all the material he had been ordered to provide, including all his tax returns and notices of assessment and re-assessment (para. 76);

c) Given that Mr. Williams’ income was in dispute, the trial judge was critical of Mr. Williams’ failure to retain copies of all his order forms for photographs (at least starting at the date the litigation commenced) and his failure to bring those documents to trial (para. 86);

d) The trial judge found that Mr. Williams received some payments in cash, accepted Ms. Williams’ evidence as to Mr. Williams not reporting some of his cash receipts, added some of Mr. Williams’ claimed expenses back to his income for child support purposes and, despite the fact that for 2006 to 2009 Mr. Williams disclosed line 150 income of $7,775, $33,824, $20,434 and $26,892 (rounded) for those years respectively, the trial judge imputed an annual income of $45,000 for child support purposes. (For those same years, 2006 to 2009, Mr. Williams’ gross sales ranged from a little over $72,600 to a little over $105,400.) It was noted by the trial judge that, by Mr. Williams’ admission, approximately one-third of his receipts were in cash (see paras. 73, 87, 88, 89 and 92);

[11] It is quite clear that the trial judge was not buying Mr. Williams’ submissions that his tax returns were an accurate measure of the income available to him for child support purposes.

[12] In relation to child support, Mr. Williams believes he is entitled to have his child support for 2011 varied to conform to his 2011 Notice of Assessment. For 2011, Mr. Williams became employed by Sports One Photography Inc., according to Rita J. Simon, who is a part owner in the business along with her husband. Ms. Simon filed an affidavit in support of Ms. Williams. Ms. Simon’s unchallenged affidavit presents a somewhat unflattering synopsis of Mr. Williams’ tenure with Sports One, including the following:

a) Mr. Williams approached Ms. Simon and her husband to help generate sales through his contacts for his business known as “Action Cards”;

b) Sports One entered into a contract with Mr. Williams and agreed to pay him $770 a week gross, less taxes and Canada Pension Plan deductions, plus an expense account capped at $8,000 annually. Mr. Williams had wanted a “guaranteed” pay cheque;

c) While working for their company, Mr. Williams kept using his “Action Cards” email account, despite being told not to, and Mr. Williams on two occasions used this account to conduct business that Ms. Simon and her husband were not aware of;

d) There was a falling out with Mr. Williams, causing him to quit Sports One in January 2012, taking with him the work he had done in the previous four to five months;

e) Mr. Williams threatened to sue Sports One but Ms. Simon learned that Mr. Williams was an undischarged bankrupt at the time the contract was negotiated. A T4 slip was issued to Mr. Williams for 2011.

[13] In his affidavit, Mr. Williams does not directly address Ms. Simon’s affidavit but he claims he is owed $1,200 in wages and “as well as $3,000 in equipment.” He fails to elaborate on the allegation that equipment is owing to him.

[14] Mr. Williams deposes that, being a “part owner” in this business (Sports One), he could not receive employment insurance benefits. However, Ms. Simon’s affidavit is clear that she and her husband each own 50 percent of the business and there is no reference at all to Mr. Williams being given an ownership interest in Sports One.

[15] Ms. Williams deposes that Mr. Williams’ 2011 income disclosure is only what he earned from Sports One and does not include the money he was earning and “pocketing” under the name of “Brian Williams Photography” while working at Sports One. Mr. Williams sidesteps this allegation and the evidence of Ms. Simon that suggest that he was working on personal files while at Sports One.

[16] Ms. Williams complains about Mr. Williams’ financial non-disclosure regarding the current court proceeding.

[17] Mr. Williams had been asked by a letter from Mr. Eberlie to provide his 2009, 2010 and 2011 tax returns, slips and notices of assessment for those years. No 2010 tax information has been provided, nor has the 2009 notice of assessment been provided.

[18] For 2012, Mr. Williams, as proof of his income during 2012, filed copies of his bank statements from January 2012 to September 2012. Mr. Williams added up his bank deposits from his business to arrive at “gross sales” and then unilaterally used 40 percent of his gross sales to approximate his net income that he states for 2012 is $1,668 per month for the period January 2012 to October 1, 2012 and that Mr. Williams then annualizes to $20,016.

[19] Mr. Williams confirms he filed for bankruptcy in October 2010. (There is no evidence as to whether he has been discharged.) On May 25, 2012, Mr. Williams consented to a refraining order that required him to pay $1,000 per month child support but he defaulted on that obligation after making the payments required in June and July of 2012. Mr. Williams deposes that as of October 4, 2012, he lost his driver’s licence. He blames the court delay for this. The Director’s Statement of Arrears, which goes to July 15, 2012, shows that during 2012 there were four payments received from Mr. Williams for child support for the period up to and including April 2012, totalling $1,121.86, and thereafter $1,000 was received in each of June and July 2012 pursuant to the refraining order.

[20] The child support arrears to July 15, 2012 are shown at $13,529.94.

[21] Mr. Williams deposes that in February 2012 his mother gave him $25,000 to help pay “debt” (he does not explain what this debt was given his assignment in bankruptcy). The money from his mother, according to Mr. Williams, was to purchase equipment to allow him to conduct his business as a sports photographer. During his oral submissions, Mr. Williams agreed that none of the $25,000 went towards child support.

[22] In June 2012, Mr. Williams had $19,123 in gross sales receipts but the only payment towards child support in June was $1,000.

[23] Mr. Williams’ motion to change, as it relates to access issues, requests a lengthy final access order, some of it duplicating the existing order. Mr. Williams fails to deal clearly with the threshold issue as to whether there has been a material change in circumstances since the date of the existing order.

[24] In relation to the motion to change child support, Mr. Williams seems to believe that he can simply return to court to calculate child support in his own way, without any regard to what was said in the reasons for judgment about imputation of income, and without heeding anything contained in the reasons for judgment about his obligation to make proper and full financial disclosure.

DISCUSSION – MR. WILLIAMS’ MOTION FOR INTERIM RELIEF

[25] It must be remembered that Mr. Williams seeks to vary a final order of child support on an interim basis. The weight of the jurisprudence supports the proposition that an interim variation of a final order can be made, but exercise of such a discretion is restricted to clear cases of hardship, or where the continuation of an order would be incongruous and absurd and, further, the moving party must make out a prima facie case and the court may consider whether a moving party has come to court with “clean hands” (see, for example, Clark v. Vanderhoeven, 2011 ONSC 2286 (Ont. S.C.J.) at paras. 52 – 67; and Hayes v. Hayes, 2010 CarswellOnt 4796 (Ont. S.C.J.)).

[26] Mr. Williams has failed to present a prima facie case on the motion that entitles him to an interim variation of child support. His financial disclosure is incomplete. His arbitrary assumption that income equates to 40 percent of gross income is disingenuous given his lack of production of any bills or invoices verifying his billings and expenses. His income tax disclosure is incomplete. He infects his motion for interim relief with all the traits of obfuscation due to financial non-disclosure that he engaged in during trial. Mr. Williams fails to account for, or even discuss, the income he earned during 2011 in addition to his T4 income. He provides no business financial statements, or even any preliminary summaries of billings and expenses with backup documents – this despite Nolan J.’s admonition in her reasons for judgment that Mr. Williams should have been aware of the need to produce “every scrap of paper that related to his business” (see para. 86). Mr. Williams has not come to court with “clean hands.”

[27] I reject Mr. Williams’ pleas of hardship and poverty. Mr. Williams received close to $45,000 cash in total from his mother (February 2012) and his gross sales (June 2012) – yet Mr. Williams could muster only a penurious $1,000 (or perhaps $2,000 if one assumes the July payment came from the June gross sales) towards child support and costs owing to Ms. Williams.

[28] Mr. Williams’ motion for interim relief is bereft of merit and is dismissed.

MS. WILLIAMS’ MOTION

[29] Subrules 1(8) and 14(23) of the Family Law Rules, O. Reg. 114/99 provide as follows:

1(8) The court may deal with a failure to follow these rules, or a failure to obey an order in the case or a related case, by making any order that it considers necessary for a just determination of the matter, on any conditions that the court considers appropriate, including,

(a) an order for costs;

(b) an order dismissing a claim made by a party who has wilfully failed to follow the rules or obey the order.

14(23)A party who does not obey an order that was made on motion is not entitled to any further order from the court unless the court orders that this subrule does not apply, and the court may on motion, in addition to any other remedy allowed under these rules,

(a) dismiss the party’s case or strike out the party’s answer or any other document filed by the party;

(b) postpone the trial or any other step in the case;

(c) make any other order that is appropriate, including an order for costs.

[30] Ms. Williams complains in her material that Mr. Williams has failed to pay two previous cost orders and that Ms. Williams is now being forced to endure the costs of a fresh motion to change, that she deposes has little or no merit. The motion to change was commenced only one year after the trial judgment. Ms. Williams is concerned that she continues to incur legal costs while, according to her, Mr. Williams is in essence judgment proof.

[31] In Kloc v. Kloc, 2012 ONSC 4431 (Ont. S.C.J.), I reviewed the authorities in relation to the proper approach in dealing with a non-complying party within the context of rules 1(8) and 14(23) at para. 27 as follows:

[27] In Molina v. Molina, [2011] O.J. No. 2287, 2011 ONSC 3030 (Ont. S.C.J.), S.E. Healey J. considered a motion by one party to strike the other party’s pleadings. That motion was grounded on subrules 1(8) and 14(23). In relying on authorities, Healey J. agreed that subrule 14(23) should not be taken lightly and that the onus is on the non-compliant party to show why subrule 14(23) ought not to apply. The court also cited a three-part test to be applied in dealing with non-compliance by a party with court orders within the context of subrule 14(23). Specifically, Healey J. stated as follows at paras. 5 to 7:

5 In Gordon v. Starr, 2007 35527 (ON SC), [2007] O.J. No. 3264 (S.C.J.) at para. 16 the court emphasizes that subrule 14(23) should not be taken lightly, and that the onus is on the non-compliant party to show, on a balance of probabilities, why subrule 14(23) should not apply. The court notes that it would take an extraordinary event to trigger the "unless' provisions of subrule 14(23).

6 The decision in Ferguson v. Charlton, 2008 ONCJ 1, [2008] O.J. No. 486, 2008 CarswellOnt 667 (O.C.J.) sets out the approach to be taken by the courts in dealing with non-compliance by a party with court orders in the context of Family Law Rule 14(23).

• The court must ask where there is a triggering event that would allow it to consider the wording of either sub-rule 1(8) or sub-rule 14(23). That triggering event would be non-compliance with a court order in the case or a related case (sub-rule 1(8)) or an order "made on a motion" (sub-rule 14(23)).

• Second, if the triggering event exists, the court should then ask whether it is appropriate to exercise its discretion in favour of the non-complying party by not sanctioning that party under sub-rule 1(8) or by ordering that sub-rule 14(23) does not apply. My review of the foregoing caselaw suggests that this discretion will only be granted in exceptional circumstances. In my view, the court's decision whether or not to exercise its discretion in favour of a non-complying party ought to take into account all relevant history in the course of the litigation and, more specifically, the conduct of the non-complying party.

• Third, in the event the court determines that it will not exercise its discretion in favour of the non-complying party, it is then left with the very broad discretion as to the appropriate remedy pursuant to the provisions of either sub-rule 1(8) or sub-rule 14(23). (emphasis added)

7 In Morin v. Cunningham, [2009] O.J. No. 2877, 2009 CarswellOnt 3974 (S.C.J.), the court considered and implicitly adopted the three part test set out in Ferguson v. Charlton, above, as did the court in Ragno v. Ragno [2010] O.J. No. 2182 (S.C.J.)

[32] In the present case, r. 1(8) is most applicable. Mr. Williams has failed to pay the costs ordered from the previous proceedings and he is in arrears of child support. His motion to change appears to have limited prospect of success, especially in relation to child support.

[33] Any sanction I impose has to balance Ms. Williams’ right not to be subjected to further litigation while Mr. Williams is in default, with Mr. Williams’ right to access to justice.

[34] I find the appropriate balance would be to leave the issue of child support arrears to be enforced by the Family Responsibility Office and not to make payment of child support arrears a condition of continuing further with the motion to change. It is appropriate to order a stay of Mr. Williams’ motion to change until such time as Mr. Williams has paid to Ms. Williams those portions of the costs orders as asked in subparagraphs 3(b) and (c) of Ms. Williams’ notice of motion. It should be noted that the amount of $4,294 sought to be paid towards the trial costs represents the 40 percent portion of the costs order that was not ordered to be enforced by the Family Responsibility Office. There is no evidence Mr. Williams has paid any of the $10,735 trial costs order.

ORDER

[35] For reasons set out above, I make the following order:

1. Mr. Williams’ motion for interim relief, initially returnable October 24, 2012, is dismissed.

2. Mr. Williams’ motion to change, initially returnable August 7, 2012, is stayed subject to the following terms and conditions:

a) subject to paragraph 4 of this order, the stay shall remain in effect until Mr. Williams has paid to Ms. Williams the following amounts:

i. the sum of $1,160 towards the costs order of Vogelsang J. dated May 31, 2010;

ii. the sum of $4,294 towards the costs order of Nolan J. dated September 9, 2011; and

iii. Mr. Williams has served and filed in the continuing record an affidavit verifying that he has made the aforesaid payments, with proof of payment attached as an exhibit to the affidavit;

b) if any conference, motion or other step has been scheduled in the motion to change, then any such conference, motion or other step is deemed cancelled and shall not proceed;

c) if the amounts referred to in subparagraph a) have not been paid within six months of the date of this order, then Ms. Williams is at liberty to bring a motion, on notice, to have Mr. Williams’ motion to change dismissed, but whether or not such a motion is brought, the continuation of the stay shall not be affected.

3. In relation to the costs of Mr. Williams’ motion for interim relief, and Ms. Williams’ motion, the parties shall forward written submissions on costs addressed care of the Family Court trial coordinator as follows:

a) Ms. Williams’ submissions – within two weeks of the date of this order;

b) Mr. Williams’ submissions – within two weeks thereafter; and

c) Ms. Williams’ reply submissions, if any – within one week thereafter.

4. Unless the costs order provides otherwise, if Mr. Williams is ordered to pay any costs of the motions referred to in paragraph 3, then those costs shall be deemed included in paragraph 2(a) of this order and the stay shall remain in effect until those costs also are paid.

“Justice Victor Mitrow”

Justice Victor Mitrow

Date: January 11, 2013