COURT FILE NO.: D12582/08
DATE: 2013/11/29
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Corrinne May Radlo
Self-represented
Applicant
- and -
Michael Francis Radlo
Self-represented
Respondent
HEARD at Brantford, Ontario:
August 1, 6, 7 & 8, 2013
THE HONOURABLE JUSTICE T. MADDALENA
REASONS FOR JUDGMENT
THE ISSUES
[1] The parties were each self-represented during this four-day trial, although it is clear from the pleadings, they each started with counsel.
[2] A three-volume trial record was filed, not in compliance with Family Law Rule 23. The three volumes contained the pleadings (application and answer), none of the court orders save and except one, but was also filled with all the acrimonious affidavits filed by the parties during this very lengthy litigation which commenced in August 2008.
[3] These parties would have each benefited from legal representation during this trial.
[4] Although both parties identified equalization of net family property as an issue in their opening statements, neither party had served or filed a net family property statement or updated financial statements. The court therefore requested that each file their respective net family property statements. Ms. Radlo’s net family property statement was eventually filed and dated August 2, 2013 and Mr. Radlo’s net family property statement was filed and dated August 6, 2013.
[5] Ms. Radlo, in her opening, made some brief requests for adjustments to child support for the period July 2009 to December 2009. She claimed no spousal support.
[6] Further in her submissions at the end, Ms. Radlo requested a restraining order which the court could not grant since Ms. Radlo provided no evidence to the court to support the granting of such an order. In fact, the first the court heard of a request for a restraining order during this trial was in Ms. Radlo’s final submissions to the court.
[7] From Ms. Radlo’s perspective, this trial was really all about nondisclosure by Mr. Radlo of two large sums of money, that is $353,600.00 and $80,000.00, which Ms. Radlo submitted were not disclosed by Mr. Radlo in his financial statements or to the court. Ms. Radlo suggested that the undisclosed monies ought to be considered either in equalization of net family property and/or also income for Mr. Radlo.
[8] From Mr. Radlo’s perspective, property and equalization of net family property were issues. He stated also that he had overpaid child support and Ms. Radlo owed him monies back.
[9] Mr. Radlo spent most of the trial trying to explain the two large sums of money that were in dispute and suggested to the court that both sums belonged to his wealthy friends who lived outside of Canada. He stated that the large sums at issue should not and do not represent part of family monies to be shared with Ms. Radlo or to be accounted for in his income.
BASIC FACTS
[10] Mr. and Mrs. Radlo were married on the 13th of May 1989.
[11] They separated on or about the 12th of May 2008. On the 10th of January 2011 the court record indicates that the divorce was severed from the corollary issues.
[12] A divorce order was issued April 29, 2011.
[13] There are two children of the marriage, namely Brandon Michael Radlo born July 27, 1992, and Taylor Jacqueline Radlo born August 15, 1994.
THE FORENSIC REPORT
[14] The bulk of the evidence in-chief of Ms. Radlo was spent by her attempting to show in her evidence that Mr. Radlo had not disclosed two large sums of money, i.e. $353,600.00 and $80,000.00, monies which she stated were part of family property or part of his income.
[15] Mr. Radlo responded that the large sums were not his but belonged to “his wealthy friends” living outside of Canada.
[16] Ms. Radlo retained Mr. Timothy Rickert of BDO Canada LLP to prepare a forensic report. The report was for the purpose of examining Ms. Radlo’s concerns that Mr. Radlo had substantial undisclosed monies in his possession.
[17] Both parties accepted Mr. Rickert as an expert and able to give opinion evidence as a forensic accountant.
[18] The report was filed with the court on consent and is dated March 16, 2012. Mr. Rickert was also subpoenaed as a witness by Mr Radlo.
[19] Mr. Radlo, who gave his evidence prior to Mr. Rickert, asserted in his evidence that the report was favourable to him and showed no hidden accounts.
[20] Ms. Radlo maintained just the opposite.
[21] I find that an examination of the report, together with the evidence of Mr. Rickert, does not confirm Mr. Radlo’s assertions. It also does not confirm Ms. Radlo’s views because a recommended further analysis was not undertaken.
[22] Mr. Rickert stated in his evidence that as a result of his forensic analysis there was one bank account of Mr. Radlo’s that he was unsure of. He stated clearly that he did not find large undisclosed bank accounts, save and except for the one that he referred to. He made a recommendation that Ms. Radlo follow up with respect to the one account, however Ms. Radlo did not do so. Ms. Radlo stated in her evidence that she had no monies left to pursue the follow-up recommendation.
[23] Thus, Mr. Rickert’s analysis was never completed so he could not say for sure if large amounts were not disclosed by Mr. Radlo.
[24] The monies in question and the monies which became the focus of the trial were the subject of a wire transfer on November 12, 2008 to Mr. Radlo in the amount of $353,600.00 CAD received by Mr. Radlo from the account of TT1/Madame in Geneva, Switzerland. This is confirmed by RBC Documents.
[25] RBC Documents wire transfer further confirm that on November 14, 2008 the amount of $353,642.80 CAD was sent by Mr. Radlo from his sole account 522-051-2 to a Steven Douglas Rush to an account in Spain.
[26] Therefore, an RBC wire transfer shows $353,600.00 from an account of TT1/Madame in Geneva, Switzerland went to Mr. Radlo and then within 48 hours back to Steven Douglas Rush in Spain.
[27] In evidence, Mr. Radlo asserted that TT1/MADAME is in fact Karin Rush, the spouse of Steven Douglas Rush, his “very wealthy friend”.
[28] This is the account identified by Mr. Rickert as missing documents to give a more complete picture.
[29] The forensic report at page 7 indicated as follows:
Other bank accounts
You will recall we inquired as to the details of the following two transactions in Mr. Radlo’s account (Transit 01312; Account 5220512):
A deposit for $353,600.80 on November 12, 2008 with a description “TT 1/Madame”; and
A withdrawal for $353,642.80 on November 14, 2008 with a description “Steven Douglas”.
The documents provided by RBC are copied for purposes of this report. It is unclear the source of use of these funds, beyond that the deposit appears to originate in Switzerland and the payment appears to finish in Spain. You may consider asking for more information about these transfers from RBC.
[30] In his conclusion on page 9 of the report Mr. Rickert stated:
Based on the above evidence, it is not clear that Mr. Radlo was making payments or transfers to and from undisclosed accounts. The details appear to show that the majority of deposits into the account were from previously disclosed accounts and the payments from the account were to credit card accounts rather than bank accounts that could be holding funds.
[31] The court finds the evidence of Mr. Rickert straightforward and very credible.
[32] From the court’s perspective it is regrettable that no follow-up action was taken by Ms. Radlo in accordance with the recommendations of Mr. Rickert.
[33] Mr. Rickert never received clear information of where the $353,600.00 came from and where it went. Thus, his forensic analysis was never completed, so from his perspective he could not say if large amounts remained undisclosed. However, emails obtained by Ms. Radlo and not made available to Mr. Rickert for his forensic analysis became the centre focus of this trial. From Ms. Radlo’s perspective the emails were a clear indication of Mr. Radlo’s previously undisclosed funds. From Mr. Radlo’s perspective they were explained by his wealthy friends helping him.
ADMISSIBILITY OF EMAILS
[34] Ms. Radlo sought to introduce into evidence copies of some of Mr. Radlo’s emails between him and third parties. Her evidence was that all of the emails were printed by her from her own computer, using the same password which the parties had used throughout the marriage.
[35] These emails that Ms. Radlo wished to introduce had not yet been “officially” disclosed to Mr. Radlo, yet he knew of them because they were emails to or from him.
[36] Ms. Radlo submitted that the emails would show that Mr. Radlo had undisclosed and hidden monies that were never accounted for on any of his financial statements, despite the various court orders for him to disclose.
[37] She submitted the emails would show an elaborate scheme on the part of Mr. Radlo to hide and transfer large sums of money out of his personal account in an effort to pay less child and spousal support and to deplete family assets.
[38] She further states he did this in a further attempt to deceive her and to deceive and misrepresent to the court.
[39] For his part, Mr. Radlo urged the emails not to be admitted into evidence as he alleged they were “stolen”, and obtained as a result of a “criminal act”.
[40] Mr. Radlo further suggested the emails were “fake”, “altered”, and “tampered with” so they could not be relied upon by the court. He proposed that the emails be excluded from evidence.
RULING ON ADMISSIBILITY OF EMAILS
[41] Having considered all of the arguments, the court permitted the emails to be entered into evidence.
[42] I found the emails were not “stolen” or obtained by Ms. Radlo by some “criminal act” as suggested by Mr. Radlo.
[43] The emails were obtained by Ms. Radlo by using the very same password that the parties had shared during their marriage. This fact was not challenged by Mr. Radlo, and I accept her evidence that they were simply copied and unaltered.
[44] When parties separate if they do not amend their computer passwords, then they do so at their own peril.
[45] There was no credible evidence provided to the court that the emails were not authentic, or that they had been tampered with in any way.
[46] The court does note that the emails obtained by Ms. Radlo should have and ought to have been earlier disclosed to Mr. Radlo. However, from the court’s perspective, these emails should not come as a surprise to him as, after all, they were emails originating from him or received from him and on his computer.
[47] Ms. Radlo’s reasons for not providing the emails to Mr. Radlo in advance were that, according to her, every time matters came up in a court hearing, Mr. Radlo would file some “false” or “misleading” evidence to support his position. She was concerned that the same would happen at trial, so she did not disclose them in advance.
[48] The trail of emails will be referred to herein.
TRAIL OF AVAILABLE EMAILS
[49] A review of some of the available emails is concerning to this court and raises serious issues of credibility.
[50] On Friday, December 19, 2008, some seven months after separation, Mr. Radlo (mike.radlo@rogers.com) wrote an email to Steven Rush (rribizacreations@gmail.com), his friend, as follows:
Steve ….. can I ask for the money during the latter part of January ……I want to spend January looking for a house, with purchase at end part of month? …
[51] On Friday, December 19, 2008 Mr. Radlo wrote to Mr. Rush via email as follows:
…When the time is best for you (after finalization of my separation), I would ask you to transfer $80,000 CAN. I would use to resolve separated debt and downpayment on new home. I would transfer money as I acquire during period between Feb and May 2009, but looks to total full $80,000 by May-end. So I would be whole with you at that time.
But your help (upfront) is paramount in terms of timing at the least. Getting in quicker, when I can negotiate much more now is everything. Having zero debt (because of your loan) makes it all possible. The fact I can pay it off as quickly as I plan makes me feel terrific. …
[52] It is noted by the court that both of these emails are just after the November 12, 2008 and November 14, 2008 transfer of $353,600.00 to Mr. Radlo from Switzerland and then transfer of $353,600.00 from Mr. Radlo to Steven Rush in Spain. The reference to the “$80,000” is significant since Mr. Radlo would say in his evidence that the $80,000.00 was Mr. Rush’s money to be used to support “his lavish lifestyle” while in Canada.
[53] Mr. Radlo has stated during the trial that both amounts of monies, i.e. $353,600.00 and the $80,000.00 were both unexpected “gifts” to him by Mr. Rush which he could not accept. The $353,600.00 was therefore sent back, according to Mr. Radlo’s evidence. Later, he would say the $80,000.00 “gift” was kept by Mr. Radlo to invest on behalf of Mr. Rush.
[54] On January 25, 2009 Mr. Radlo forwarded an email to Mr. Rush as follows:
How is mid-Feb looking for transfer of money? I have a feeling that Corrie’s lawyer will have a proposal over to our side for review within a week. …
[55] A further email was sent February 12, 2009 from Mr. Radlo to Mr. Rush as follows:
Received …. thank-you
Could I ask you just to put together a small e-mail (that I will print out) to indicate that the money transfred[sic] is to be regarded as a GIFT ….. important distinction for possible court proceedings
I will keep you regularly updated on activities as the weeks ahead go by …
[56] On February 15, 2009 Mr. Radlo forwarded an email to Mr. Rush again as follows:
Could you send me an e-mail that specifically states that the money transferred (state the date of 2/12) was a GIFT from you for the purposes to assist me with clearing debt and obtaining a house after my separation.
Those words will remove any doubt or attempt on Corrie’s lawyer’s part to say it was my money.
[57] On December 28, 2009 Mr. Radlo forwarded an email to Dipak Lad, another friend, which included the following:
… Did your bank ever give you the transfer money (the fee) back when they stopped the transaction?
Related, the huge transfer of $271,000 US will be done to Steve Rush around Jan 6, with the transfer to my mom for approx a week later! ….so, for what I was hoping to capture in any transfers, this works out the best anyway, especially with a copy of the green transfer form (of ours) as it shows that I tried to return the monies to the right owners in various and all ways!!! ….so, thanks, Dee and thank your wife for her support through you (to me) as well
I am already enrolled in any/all EI programs, but must register for EI on-line this afternoon
I am already given an endorsement through a General Advice Lawyer for a certificate that allows me to work with LegalAid Ontario (it started the process) to go through the assessment to possibly get 100% of my future legal bills paid …..again, I cannot state how I have been thinking of no job for these type of reasons …… getting approx $20,000 of legal bills paid is equivalent to having $36,000 in pay at a job!! …. but, now, I get to focus and attack and get it over with!!!
[58] What is disturbing concerning this email is that Mr. Radlo indicates that a “green transfer form” will show that he tried “to return the monies to the right owners in various and all ways”. This was exactly the evidence presented to the court November 2, 2010. Further, the email specifically talks about a large transfer of $271,000 US to Steven Rush and then a transfer back to Mr. Radlo’s mother.
[59] In view of all of this, the court finds the lengthy letter dated October 20, 2010, purported and represented to the court as written by Mr. Rush, was actually written entirely by Mr. Radlo and executed by Steven Rush. This letter was utilized for an important long motion in the proceeding which took place November 2, 2010. The contents of that letter were made a court exhibit, but the letter executed by Steven Douglas Rush, as well as his out-of-country attorney Ingacio Sitja, stated in part:
… Karin and I decided that we wanted to give Mike a surprise offer of an exceptional gift with the hope that he could immediately start a new life all over again without the fear of financial burdens. We were hoping that it would lift Mike emotionally, and allow him to continue with his new job not being impacted by other major concerns. Without any advance notice, Karin and I wire transferred Mike a large sum of money that would arrive in Brantford for the day before I came into town in October 2008 for a planned stopover visit. I was also in town to close out the estate of my parents who had both recently passed away. It was Karin and my hope that Mike would accept the generous offer of a gift of money in which to buy a new home. Mike surprised us when he stated that he could not accept such a gift for a number of reasons, not the least of which was he did not want it to come into play with the legal proceedings he was about to undertake. Mike immediately had me work with his bank officials in having the full sum of money wire transferred back to us. I believe that the whole process for the return of all of the monies occurred within a 48 hour period. …
As a precursor to our many planned trips to Canada and the US, through Canada, Karin and I discussed with Mike and wire transferred to him a sum of $80,000 Canadian at the end of February 2009. The money was to remain with Mike for safekeeping, for short term investing, for our use during our trips, and to potentially serve as a downpayment for any properties that we may have decided upon. Mike and I discussed the previous concern he had regarding the October 2008 wire transferred monies, however, Mike accepted this wire transfer based on the fact that it was not for him, or for his personal use, as the October 2008 monies could have been misconstrued.
Mike discussed with us that he could open a trading account with advantageous commission fees and margin rates. Mike mentioned that another common friend of ours (Dipak Lad) was interested at the same time in investing a much smaller amount of money and proceeded to deposit my monies into the account along with Dipak Lad’s. …
Periodically, we requested the withdrawing of monies centered around our vacation periods into Canada and the US. Mike conducted all such withdrawals in cash form and kept for our arrivals. We used the cash for our vacation needs within Canada and the United States.
[60] On February 11, 2010 Steven Rush emailed to Mr. Radlo:
… I assume you are going as planned and what we talked about you doing. Good for you my friend, great decisions!
Let me know something about the transfer as it will be coming here to Spain not to the other place. Let me know where you are so I can give you a call instead of cryptic emails :)
[61] Further, on Thursday, February 25, 2010 Steve Rush forwarded an email to Mr. Radlo:
The currency doesn’t matter but just tell me what the Canadian value is so we can keep track of everything.
You can send the funds in my name Steven Douglas Rush, as it is on this account.
Other than this problem I have created here, tell how things are going. We hope you are really doing great!
[62] Further, on January 10, 2010 Mr. Radlo wrote to a cblake@adhesives-solutions.net:
OK
I’ve thought it over
Would like to ask you if I can wire transfer equivalent to approx $300k in $US this week to you
Could you receive, then wire back next day in $US to me (my mom’s account)?
We would have to exchange bank information including SWIFT #, etc
Could you talk to your bank Manager and have him help you?
Maybe say that I am wiring you money because you were going to borrow it from me to cover off purchases for your business, but then you secured other sources and wired it back (explains the wiring back 1-2 days later)
Let me know what you think
Sent from my BlackBerry device on the Rogers Wireless Network
[63] From the court’s perspective this money does not have any characteristics of a “gift”. It more likely resembles Mr. Radlo hiding monies to not have to account.
[64] A further email of January 14, 2010 from Mr. Radlo to cblake@adhesives-solutions.net stated :
I spoke with RBC DirectInvesting agent this morning. All is good on my end, except that I must wait for the settlement date (Tue Jan 19 at midnight) before the monies are actually in my trading account. So I worked with them and they have set the transfer (from RBC DirectInvesting to my bank account) to actually take place at midnight next Tuesday so that the monies are available for me immediately in the morning on Wed Jan 20.
So I will go to the bank branch for the morning of Wed Jan 20 and complete the wire transfer to you.
The transfer is going to be for exactly $281,500 US if you want to communicate with your bank and get things set up, ahead of time, on your end for its receipt and further transfer.
Remember to keep an immediate $50,000 US for your business needs as we have discussed, so only $231,500 US would be forwarded.
[65] On February 25, 2010 Mr. Radlo emailed to cblake@adhesives-solutions.net as follows:
… I know that you want to pay me back the $50,000 US quickly, but we discussed last early last month and you helped a lot and I still say do not worry about it – and I mean it – we are always friends and any way we can help each other we do.
And, not to complicate things further, we could get even more elaborate by you paying me (ie. as a contracted employee) for reimbursable expenses such as lodging (ie. my rent), car lease and gas ….. the actual mechanics of the cashflow would be (1) you paying each of those expenses (tax-deductible on your end), (2) I reimburse you in cash for the actual total you paid less the agreed upon amount from above monthly profit (privalege[sic] of use) from the $50,000
The benefits to you are obvious (tax deductions and an approx 50% share of profit in the market from the $50k) and the benefits to me are 50% share of profit in the market from the $50k and an apparent source of funds from friend(s) that cover the major living expenses for me
[66] On Saturday, May 22, 2010 Mr. Radlo emailed to cblake@adhesives-solutions.net:
OK, for many reasons, I’m going to use Kristy’s bank account for receiving monies. Thanks again, talk to you on Monday as usual. …
[67] The series of emails between Mr. Radlo and Mr. Blake, from the court’s perspective, may very well be a scheme to hide monies. Mr. Radlo is requesting monies wired to his mother’s account, then to “Kristy’s bank account”. Ms. Radlo states the money in question came from the marriage and Mr. Radlo is putting together an elaborate scheme to make it look otherwise.
[68] On October 14, 2010 Mr. Radlo emailed to Mr. Steven Rush at rribizacreations@gmail.com:
(1) Hope you received the Friday, Sept 10 wire transfer (last one to go out) for $2,000 US sent via my mom again.
(2) Next amount be wired out on Wednesday, Oct 20 (next week) for $2,000 US again through my mom’s account as well.
This should bring amount paid up to $26,300 CAN approximately. My goal is still to get amount paid closest to 50% ($40,000) by end of year, or as soon as possible. Obviously, would be easier if not for all of the crap going on (predominantly legal).
Too much to tell you, however, I can tell you that it has been a very good fight with Corrie’s lawyer since I have done my own legal as of July 12 ….. the tables (the control) have definitely been turned …. and then some!
I am in the midst of completing my latest two absolute KILLER Affidavits and being readied for serving and filing for Monday, October 25 before the November 2 long motions date scheduled.
I will be sending you an e-mail asking for you to send a letter to me regarding monies I received from you in February 2009. But I will be sending you the actual letter I containing the statements that I feel that I need for court – please review it, discuss it with me (if need be). It is no different than the e-mails I have sent you in the past asking for explanation. However, (this is the key part), I need you to get it notarized and fax it to me for use in court.
My schedule is lighter this Friday if you want to call …… but you can you tell me what number will show up on my end as I receive a lot of calls from creditors and I do not pick up the phone unless I know who is calling nowadays :)
[69] On October 20, 2010 there is an email from Mr. Radlo to Steve Rush at rribizacreations@gmail.com as follows:
Please review the following attached letter (written by me). The same letter is sent in two different formats in the event you had problems opening one of them. I included all of the elements within the letter that I believe that I will need to offset Corrie’s lawyers wild attempts (he is throwing as much shit against the wall as possible about 100s of things ….. it’s non-stop …. I have been able to defeat most of them, only a few remaining, including this one).
Please review, change what you feel you want/need to, call me (if needed) ….. but I will need your [the] final version printed off and notarized (on your end) and faxed to me ASAP. I am at home this Friday (519-304-2144), or on cell (226-208-6352) to talk. I have a lot of good things going on as well, including three good job opportunities (I might even attempt to do all three, or parts of all three!)
[70] It is further abundantly clear to the court that the correspondence that was prepared by Mr. Rush dated October 20, 2010 and referred to earlier in this judgment was in fact entirely prepared by Mr. Radlo and simply executed by Mr. Rush and his attorney. It was presented to the court as if it had been prepared in its entirety by Mr. Rush when, in fact, it appears not to have been the case.
[71] Further, on September 17, 2010 Mr. Radlo wrote to Dipak Lad at dlad@ellsworth.com. Mr. Radlo wrote:
Huge favor .… can I get you to print the e-mail, and get notarized …. to properly use in court
[72] On February 18, 2010 Mr. Rush forwarded an email to Mr. Radlo containing the following:
Hi Mike:
For the transfer, anything will help at this moment. More is better for the time being and we expect a huge cash influx shortly to get us back on track. My hope is that with one big transfer it will see us through until our influx arrives. The problem is, it is out of our control and in control of a judge in Ibiza. We were to be there “in February” he said but to date not a word as to when. So we wait on the edge of our seats for a 3rd world judge to decide when he actually wants to show up and do some work for a change. Pissing me off completely!!! Below is the account info for me here on the mainland. The bank is aware something will come but just let me know the amount and when it is sent so it is released right away by them. On other things, first, we are still planning on Vancouver in August/September so keep it pencilled in on your calendar. How are things in general for you. I hope that everything is going as planned for you professionally. Also, how are things personally? Any new conquests to share, and Kristy?
I have tournaments this week and weekend so let me know what your plans are and I can give you a call to catch up, as there are things I am sure not to be discussed here on email!
[73] Further on February 19, 2010 Steve Rush wrote to Mr. Radlo:
Hi Mike;
Yes there is concern, [t]hat is why it comes into my account. The problem is that these next couple of months are somewhat difficult to make ends meet from a cash perspective and given that I am from outside Spain it gives us the best chance to skate though[sic]. …
[74] The court notes this is the email from a supposedly “wealthy friend”, living a “lavish lifestyle”
[75] On October 14, 2010, Mr. Radlo forwarded an email to a friend Omar:
… I need the cheques made out to my mom (Sheila Radlo) … a series of 3,000.00 (maximum) cheques to total the full amount of the return of capital ….
[76] The query here is whether Mr. Radlo is referring to $80,000.00. If so, Mr. Radlo represented in his evidence that $80,000.00 was monies that he used to invest for his friends and that the money was not his, yet cheques are now being made out to his mother to “total the full amount of the return of capital value”.
[77] On October 23, 2010 Mr. Radlo wrote to Mr. Rush:
… I have even recently transferred my lease into Kristy’s name, with the (supposed) explanation that I can no longer afford to live here, and that I am staying for the month of November paying Kristy $300 until I find a new place to stay ….. long story Steve, but such a ‘move’ helps me out in so many ways, not the least of which in court ….. again, her lawyer does not know at this time and will probably make himself look like an asshole in court by accusing me of living beyond my means or something – only to get killed in my response yet again !!!!
Bring on November 2 !!!!
CONCLUSIONS RE: $353,600.00
[78] Of noteworthy is that the letters presented to the court for the November 2, 2010 motion from Dipak Lad were written entirely by Mr. Radlo. More importantly, the letter presented to the court by Steven Douglas Rush, dated October 20, 2010, for the November 2, 2010 long motion, was also prepared, I find, in its entirety by Mr. Radlo. His friends, wherever they are, simply endorsed what Mr. Radlo wrote. Mr. Radlo’s claim that the $353,600.00 came from Steven Rush in an attempt to permit him to purchase a home and was a gift is completely not credible. Mr. Radlo indicates that he returned the monies forthwith, i.e. within 48 hours, back to Mr. Rush. This is also not credible.
[79] Ms. Radlo maintains this is in fact Mr. Radlo’s money, yet he concocted a scheme of transferring monies in and out of the country in order to make it look that it is not his own.
[80] The test in a civil case is on the balance of probabilities. I find on the balance of probabilities, based on the email evidence presented, that Mr. Radlo presented a nefarious scheme to deceive Ms. Radlo and the court with respect to the $353,600.00 and the $80,000.00. The preposterous explanations given by Mr. Radlo are not believable.
[81] It is impossible, based on the evidence presented, to follow all of the transfers in and out. The court suspects the emails are not all there and not all retrieved by Ms. Radlo. However, there are clearly some questions that have not been sufficiently explained by Mr. Radlo. The court does not accept Mr. Radlo’s explanation that he has wealthy friends abroad who are prepared to gift to him $353,600.00 in order to purchase a home. Further, why is the money coming from Switzerland into Mr. Radlo’s account? Why is the money from Mr. Radlo’s account then transferred to Spain? Why are there several emails suggesting deposits of monies, large and small, to Mr. Radlo’s mother’s account?
[82] I simply do not accept Mr. Radlo’s evidence that this money initially belonged to his wealthy friends abroad. Indeed, no evidence was presented to the court to suggest these monies originated in overseas accounts of his wealthy friends. Nor does the court accept Mr. Radlo’s claims that these were post-separation monies, in any event, and therefore are not part of monies that would be subject to the equalization of net family property.
[83] The introduction of Mr. Radlo’s mother’s account in all of this, particularly in the email of December 28, 2009 from Mr. Radlo to Dipak Lad suggesting that the $271,000 US be transferred to Steve Rush, then one week later to his mother’s account, is disturbing, concerning and perplexing.
[84] This simply leaves the court to conclude that there was an elaborate scheme of transfers in and out of the country from Geneva, Switzerland, then to Spain, in order to mislead, deceive and confuse. I also accept Ms. Radlo’s evidence that Mr. Radlo had visited Switzerland in 2007, and may have possibly put this whole process in place at that time. Mr. Radlo did not refute that he had been to Switzerland in 2007, but did refute that all this was an elaborate scheme concocted by him.
[85] Further, the court has noted that in the midst of all of this the court issued a non-depletion order on November 4, 2008 which was completely ignored by Mr. Radlo in all his machinations.
[86] The preposterous explanations given by Mr. Radlo are not believable. I find that the monies en route to/and from various places were eventually destined for Mr. Radlo and are the Radlos’ own monies.
[87] Thus the court finds that both sums are monies that originated from Mr. Radlo’s account and are proper monies to be dealt with in the equalization of net family property.
THE AMOUNT OF $80,000.00
[88] Mr. Radlo stated in his evidence that he received $80,000.00 from the account of TT 1/Madame (Karin Rush) in Switzerland and this was forwarded to him in order to permit him to trade for his friends.
[89] Therefore, Mr. Radlo indicates the amount of $80,000.00 went into a stock account which he traded on behalf of Steven Douglas Rush. He indicates that the $80,000.00 was a loan from Mr. Rush, and not Mr. Radlo’s money.
[90] Ms. Radlo maintains in her evidence that this was money belonging to Mr. Radlo and that he used this money to pay her Revenue Canada account which was incurred as a result of Mr. Radlo improperly filing her income tax return.
[91] The transfer of the $80,000.00 originated from an account TT 1/Madame (Karin Rush) in the amount of $80,000.00. Mr. Radlo maintains the investments were made on behalf of Steven Douglas Rush and Karen Rosin-Rush totaling the full amount of $80,000.00. This transfer came on February 11, 2009.
[92] The clear undisputed evidence is that Mr. Radlo showed 100% of the capital gain from the stock trading on his 2009 income tax return. Mr. Radlo maintains in his evidence that he should have set up an investment club when he invested on behalf of his friends. As a result of the fact that he did not do so, he felt that he should take all of the capital gain on his income tax return for 2009. It is clear his 2009 income tax return (the only income tax return filed in this trial) includes line 127 taxable capital gains of $46,579.87. It therefore brings Mr. Radlo’s total line 150 income to $182,725.62.
[93] The court concludes the $80,000.00 amount is money that originated from the Radlos and is not from Mr. Rush. The explanations provided by Mr. Radlo lacked any semblance of credibility.
[94] With respect to his mother’s account, Mr. Radlo stated in his evidence that Mr. Steven Rush regarded his mother as a parent, that Mr. Rush wanted his money in Canada, and that his mother would handle the money for Steven Rush. His mother was supposed to conduct online trades for his friends, even though Mr. Radlo admitted his mother had absolutely no trade experience. This is not credible evidence.
[95] The court concludes that the transactions dealing with the two large sums are largely unexplained by Mr. Radlo. What is obvious is that Mr. Radlo has put together a web of transfers, both in and out of the country, between himself, TT 1/Madame, and Mr. Rush, and others. He has also involved his mother’s account with no real credible explanations. I do not find his explanations even remotely credible. This has the air of a nefarious scheme with an ultimate purpose to deceive and mislead.
[96] When asked to explain the December 28, 2009 email to Dipak Lad, Mr. Radlo asserted in his evidence that he was trying to return money to Steven Rush and Dipak Lad and that he was helping Steven Rush and Dipak Lad move money.
[97] Then with respect to the $80,000.00, Mr. Radlo insisted he invested the funds for Steven Rush and Dipak Lad, and they collected the dividends. He did not. This was his evidence despite the fact that the entire capital gain is shown on his 2009 income tax return as if it was his money entirely.
[98] The court concludes Mr. Radlo did not disclose two sums of money, $353,600.00 and $80,000.00. The court does not accept his evidence that this is money belonging to his wealthy friends and/or he was helping his wealthy friends move money. The court does not accept Mr. Radlo’s assertion that his mother was trading for Steven Rush even though she had no trade experience. The court does not accept his assertion that the $353,600.00 plus $80,000.00 were provided to him as a “gift” which he then refused and attempted to return. The emails provided raise more questions than answers. Simply put, I do not find the central stories of Mr. Radlo credible. I find they are a deliberate attempt to confuse and obscure the truth.
MISCELLANEOUS UNEXPLAINED WIRE TRANSFERS
[99] There are a number of unexplained transfers of money by Mr. Radlo to his mother, one of which was on September 2, 2008. Shortly after the separation Mr. Radlo transferred $25,000 US funds to his mother’s account. Previous to that the evidence shows that on October 3, 2007 he had transferred $15,000.00 US to his mother’s account. Further on October 22, 2007 he transferred $5,793.00 US to his mother’s account.
[100] During the evidence at this trial these series of wire transfers were unexplained by Mr. Radlo. They remain unexplained to the court.
SPOUSAL SUPPORT
[101] The court notes (from the court record) that in the long motion which took place on November 2, 2010, spousal support was terminated effective February 1, 2010 by court order.
[102] Throughout this trial Ms. Radlo advised that she was not seeking any ongoing spousal support for herself.
[103] Had Ms. Radlo had legal representation she could perhaps have pursued a claim for spousal support based on Mr. Radlo’s nondisclosure. No such claim was made by her, other than a claim for $2,000.00 of spousal support arrears.
[104] Accordingly, I order arrears of spousal support payable by Mr. Radlo fixed at $2,000.00. This shall be enforced through the Family Responsibility Office (“FRO”).
CHILD SUPPORT - ONGOING
[105] Ms. Radlo acknowledged in her evidence at trial that the child Brandon finished school in April of 2012.
[106] From the court record it is clear that Mr. Radlo was paying support for one child effective May 1, 2012. This accords with Ms. Radlo’s evidence that Brandon finished school April 2012 and the ongoing support would continue for one child, namely, Taylor.
[107] From the evidence of Ms. Radlo, Taylor finished school effective June 30, 2013. Ms. Radlo at the trial indicated that she is no longer requesting child support for Taylor.
[108] Neither of the parties filed a completed and fully updated statement from FRO.
[109] However, Mr. Radlo in his submissions indicated that he is prepared to pay support for Taylor up to and including August 15, 2013. Therefore, my order is that the child support that had been ordered for Taylor would end August 15, 2013. Further, any and all arrears outstanding to August 15, 2013 shall be paid fully by Mr. Radlo. As I was not provided with an updated FRO statement, the court cannot calculate what, if any, arrears are outstanding effective August 15, 2013. Those arrears, however, must be paid. Once those arrears are paid and subject to this order, there is no more ongoing child support payable for Taylor. Therefore, my order is that the current court-ordered child support for Taylor, i.e. $601.00 per month as ordered June 12, 2012, will continue to and including August 15, 2013 at which time the child support will terminate.
ARREARS OF CHILD SUPPORT
[110] Ms. Radlo claimed child support arrears for the period July 2009 to February 2010. She states those arrears are $3,200.00 and she calculates those based on an income of $185,000.00 instead of the $135,000.00. Beyond that, she stated in her evidence she “cannot figure out the rest”.
[111] The parties could have used the assistance of legal representation. It is clear from the court record that, initially, child support was based on 2009 income tax of Mr. Radlo of $135,000.00. His 2009 income rounded is $183,000.00. Accordingly, a simple adjustment from July 2009 to February 2010 would, in accordance with the guidelines, require a retroactive adjustment of $3,200.00 (rounded). Therefore, Mr. Radlo is ordered to pay retroactive child support adjustment to Ms. Radlo in the amount of $3,200.00. This shall be enforced through FRO.
[112] Further, Mr. Radlo submitted in his evidence that he has overpaid child support by the amount of $14,500.00 since 2009. I do not accept as credible the husband’s calculations of arrears owed to him. The statements and the numbers are with no supporting credible evidence and therefore this claim by him is dismissed. None of the figures entered by him and considered as overpayment have been proven in his evidence in any way. The only information the court has are his assertions in evidence which the court finds not credible. Therefore, his claim for overpayment of child support is dismissed. Any claim for overpayment of spousal support is also dismissed.
EQUALIZATION OF NET FAMILY PROPERTY
[113] Ms. Radlo initially stated that she believed the equalization payment owed to her by Mr. Radlo was $250,000.00. Mid-trial she filed a net family property statement which calculated that the equalization payment owed to her was $127,447.00.
[114] Based on Mr. Radlo’s net family property statement, he would owe an equalization payment to Ms. Radlo of $20,098.00.
[115] Ms. Radlo’s net family property statement (Exhibit 30) accounted for $498,071.00 of “missing cash” attributed to Mr. Radlo. The court concurs, given the findings with respect to the $353,600.00 and the $80,000.00 amounts, as well as other unexplained amounts.
[116] Mr. Radlo made an assignment in bankruptcy in October 2012. At the time of trial Mr. Radlo was not yet discharged.
[117] The court made a further order on the 25th of January 2013 lifting a stay and permitting Ms. Radlo to pursue her application against Mr. Radlo despite his declaration of bankruptcy. The court noted in its order that Ms. Radlo is able to continue her application against the bankrupt, Mr. Radlo, but this should be only “for the purpose only of establishing the amount for which it is entitled to prove in the bankruptcy of the bankrupt as an unsecured claim.”
BANKRUPTCY AND VALUATION DATE DEBTS
[118] Neither party dealt with the issue of how Mr. Radlo’s bankruptcy might affect the calculation of net family property. At issue is what effect does the husband’s assignment in bankruptcy have on the calculation of net family property?
[119] There is some authority for the court to exclude, from the calculation of Mr. Radlo’s net family property statement, any debt he will not be required to pay due to his bankruptcy. In the case of Ahmed v. Ahmed, (1999 Carswell Ont 4819) (Ont. CJ Gen Div) the husband’s net family property statement included debts which would not be repaid due to his filing an assignment in bankruptcy. The court noted:
It would be most unfair and indeed monstrous not to look beyond this date and see that these debts will never be repaid because of the bankruptcy …
Similarly, here, all the debts in the respondent’s column in the net family property statement filed by Ms. Radlo are extinguished by the bankruptcy of the husband.
[120] Therefore, taking the above into consideration, the equalization payment owed by Mr. Radlo to Ms. Radlo is $268,683.00. Thus, Mr. Radlo owes to Ms. Radlo, on account of equalization of net family property, the sum of $268, 683.00. [^1]
COSTS AT THIS TRIAL
[121] There is a long standing presumption that a successful party is entitled to costs. Family Law Rule 24(5) permits the court to consider a party’s unreasonable behaviour in assessing costs. Further, Family Law Rule 24(8) permits the court to consider whether a party has acted in bad faith in the assessment of costs.
[122] Bad faith has been defined, for the purpose of Rule 24(8) as:
Bad faith is not simply bad judgment or negligence but rather implies the conscious doing of a wrong because of dishonest purpose or moral obliquity. It contemplates a state of mind affirmatively operating with furtive design or illwill.[^2]
[123] Thus, Mr. Radlo’s conduct intended to mislead and deceive comes within the bad faith parameter. This conduct has no doubt contributed to the acrimonious and lengthy litigation virtually leaving Ms. Radlo and the children destitute.
[124] Bad faith and unreasonable behaviour has been rampant in this litigation. On February 8, 2013 the court endorsement reads as follows:
“… Mr. Radlo must obey court orders. His email of Dec 28, 2012 to the applicant confirming he had given instructions to hold off splitting the RRSP contrary to 2 specific court orders is astounding …”
[125] Although Ms. Radlo was self-represented during the trial, clearly having used all her financial resources by that time, a substantial costs award is appropriate to denounce the conduct of Mr. Radlo. I am satisfied that a costs award in this case must reflect more than the usual criteria for the awarding of costs to a self-represented party.
[126] Accordingly, I order costs payable by Mr. Radlo fixed in the amount of $15,000.00, payable within 60 days. One half of these costs, i.e. $7,500.00, are enforceable through FRO as support.
SUMMARY OF ORDERS
[127] Summary of orders:
Child support as ordered June 12, 2012 in the amount of $601.00 for Taylor Jacqueline Radlo, born August 15, 1994 shall terminate August 15, 2013.
Mr. Radlo shall pay any and all arrears of child support accumulated to August 15, 2013.
In addition to arrears referred to above, Mr. Radlo shall pay to Ms. Radlo on account of retroactive adjustment to child support the amount fixed at $3,200.00.
Mr. Radlo shall pay to Ms. Radlo on account of retroactive adjustment to spousal support, an amount fixed at $2,000.00.
Mr. Radlo’s claims for overpayment of child and spousal support are dismissed.
Mr. Radlo shall pay to Ms. Radlo on account of the equalization of net family property the amount of $268,683.00.
COSTS
(i) Any costs that were previously ordered by the court must be paid. The court notes that on October 15, 2009 Ms. Radlo was awarded costs of $15,000.00 plus GST of $750.00, plus disbursements. The disbursements were to be paid within 30 days. The court further ordered, “the amount of $5,000.00 shall be paid by the respondent father to the applicant mother within 120 days. The balance shall be paid at the end of trial.” Any outstanding costs as a result of the order of October 15, 2009 shall be paid within 60 days. These costs are enforceable as child support through FRO.
(ii) Further, on June 12, 2012 costs of $1,500.00 were ordered to be paid by Mr. Radlo to Ms. Radlo out of his RSP. If this amount has not been paid, it remains outstanding and shall now be paid within 60 days.
(iii) Mr. Radlo shall pay within 60 days costs to Ms. Radlo fixed at $15,000.00. Half of these costs (i.e. $7,500.00) are enforceable as support through FRO.
Maddalena J.
Released: November 29, 2013
COURT FILE NO.: D12582/08
DATE: 2013/11/29
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Corrinne May Radlo
Applicant
- and –
Michael Francis Radlo
Respondent
REASONS FOR JUDGMENT
Maddalena J.
Released: November 29, 2013
[^1]: See Exhibit 30. Reduce respondent’s debts to zero. Respondent has NFP of $741,821. Applicant has NFP of $204,454. Equalization is $268,683.
[^2]: Hendry v. Martins [2001] O.J. No. 1098 (OntSCJ)