CITATION: Norris v. Norris 2016 ONSC 7077
COURT FILE NO.: FC-15-240
DATE: 2016/11/21
SUPERIOR COURT OF JUSTICE – ONTARIO
FAMILY COURT BRANCH
RE: Anderson Llewlyn Norris, Applicant
AND
Ellen Seville Norris, Respondent
BEFORE: Madam Justice S. Corthorn
COUNSEL: Michael Rappaport, Counsel for the applicant (respondent party)
Steven Fried, Counsel for the respondent (moving party)
HEARD: October 21, 2016
ENDORSEMENT
Introduction
[1] The parties separated a number of years ago – in 2008 or 2009. The date of separation is an issue to be determined in this proceeding. A ‘Rule 2’ trial, for the purpose of determining that issue, is scheduled for January 2017. The determination of that issue will in turn play a role in the outcome of the applicant’s (“Mr. Norris”) claim for an equalization payment. The respondent (“Mrs. Norris”) takes the position that the claim for an equalization payment is statute-barred by reason of the expiration of the applicable limitation period.
[2] Mrs. Norris brings a motion at this time for interim relief with respect to the matrimonial home. Mrs. Norris’ position is that she has, since the parties separated, been paying the balance owing on a line of credit, secured against the matrimonial home, which Mr. Norris obtained without her consent (“the Line”). The principal amount of the Line was $150,000. Mrs. Norris alleges that Mr. Norris used the entire amount for his purposes and has paid nothing towards the balance owing. Mrs. Norris has paid approximately $80,000 towards principal and interest, the latter charged at nine per cent per year. The balance currently owing on the line is said by Mrs. Norris to be approximately $125,000.
[3] Mrs. Norris seeks relief to address the burden of paying down the Line at an interest rate of nine per cent per year. She has explored the possibility of re-financing the Line. Based on her investigation of potential re-financing, Mrs. Norris believes that by re-financing the Line at a lower interest rate, she would be able to save approximately $600 per month as she continues to pay down the balance owing. The financial institution with which Mrs. Norris is dealing has declined re-financing to be secured against the matrimonial home. The reason given is the credit risk posed by Mr. Norris, who remains on title to the home.
[4] The alternative forms of interim relief sought by Mrs. Norris with respect to re-financing the Line are as follows:
a) An order vesting the title of the matrimonial home in her name;
b) In the alternative to (a), above, an order permitting Mrs. Norris to:
i) transfer the title of the matrimonial home from the couple’s names, jointly, to her name alone; and
ii) re-finance the Line by obtaining a mortgage, secured against the matrimonial home, in the amount of $187,000 at an interest rate lower than nine per cent per year;[^1]
c) In the alternative to (a) and (b), above, an order granting Mrs. Norris exclusive possession of the matrimonial home;
d) An order that Mrs. Norris’ payments towards the Line in the amount of $1,329 per month be deemed as spousal support effective January 1, 2015, including that the payments be taxable to Mr. Norris and tax-deductible to Mrs. Norris;
e) In the alternative to all of the above, an order that Mr. Norris pay the full monthly amount owing on the Line ($1,329 for principal and interest) effective July 2009; [^2]
f) In the further alternative to all of the above, an order that Mr. Norris pay to Mrs. Norris the sum of $230,000 as reimbursement of the principal amount of the Line ($150,000) and the amount paid by Mrs. Norris towards principal and interest on the Line ($80,000).
[5] It is the position of Mr. Norris that regardless of which alternatives proposed by Mrs. Norris are considered, there is no support in the applicable statute or case law for the relief requested. Mr. Norris’ position is that the only relief which the Court has jurisdiction to grant is an order that Mrs. Norris purchase Mr. Norris’ interest in the matrimonial home or that the property be sold. Under either scenario, the monies paid/received would be held in trust or paid into Court pending a determination of the financial issues, including an equalization payment.
The Issues
[6] The issue to be determined on this motion is whether Mrs. Norris is entitled to interim relief with respect to the matrimonial home pending the outcome of the Rule 2 trial with respect to the date of separation. The issues to be determined include the following:
Is Mrs. Norris entitled to an interim order pursuant to which title to the matrimonial home is vested in or transferred her name only, pending a determination of whether an equalization payment is to be made?
Is Mrs. Norris entitled to an interim order granting her exclusive possession of the matrimonial home?
Is Mrs. Norris entitled to an order the effect of which is to treat as spousal support the payments made to date and those made in the future by Mrs. Norris towards the Line (in its existing form and potentially as re-financed, respectively)?
Issue No. 1: Title to the Matrimonial Home
[7] The general authority of the Court to make a vesting order is found in s. 100 of the Courts of Justice Act: “A court may by order vest in any person an interest in real or personal property that the court has authority to order be disposed of encumbered or conveyed.”[^3] In the context of family law matters, the authority of the Court to make a vesting order is found in s. 9(1)(d) of the Family Law Act [FLA], which provides as follows:
In an application under section 7, the court may order …
(d) that, if appropriate to satisfy an obligation imposed by the order,
(i) property be transferred to or in trust for or vested in a spouse, whether absolute, for life or for a term of years, or
(ii) any property be sold or partitioned. [^4]
[8] It is Mrs. Norris’ position that a vesting order is available in the context of an application pursuant to Part I of the FLA for an equalization payment (ss. 5, 7, and 9 of the FLA). The notice of application on behalf of Mr. Norris sets out his request for an equalization payment, although the document does not reference s. 5 of the FLA.
[9] Not only does Mrs. Norris rely on statutory authority in support of her request for a vesting order. She also relies on the origin of vesting orders as relief granted in equity. It is submitted on her behalf that the jurisdiction of the Court to grant a vesting order is therefore “elastic”.
[10] Mrs. Norris acknowledges that for a vesting order to be granted in the context of family law, the Court must be satisfied that:
• The previous conduct of the party obligated to pay, and his reasonably anticipated behaviour, are such that the ‘payment order’ will not likely be complied with in the absence of a less intrusive order;
• There is a reasonable relationship between the value of the asset to be transferred and the amount of the targeted spouse’s liability; and
• The interests of any competing execution creditors or encumbrancers with exigible claims against the specific property in question are not an impediment to the granting of a vesting order.[^5]
[11] Mrs. Norris also relies on the prior conduct of Mr. Norris, in support of her request pursuant to Part II, ss. 21 and 23(b) or (d) of the FLA for the alternative relief sought – an order permitting her, without the consent of Mr. Norris, to re-finance the Line secured against the matrimonial home.
[12] Mr. Norris admits he obtained the Line without the consent of Mrs. Norris. Based on that admission, Mrs. Norris submits that Mr. Norris contravened s. 21(1)(b) of the FLA. That section provides that, “[n]o spouse shall dispose of or encumber and interest in a matrimonial home unless … (b) the other spouse has released all rights under this Part or by a separation agreement.”
[13] On the basis of Mr. Norris’ contravention of s. 21(1) of the FLA, Mrs. Norris submits that she is entitled to the relief set out in s. 23(b) or (d) of the FLA, namely to an order:
(b) authoriz[ing] the disposition or encumbrance of the matrimonial home if the court finds that the spouse whose consent is required,
(i) cannot be found or is not available;
(ii) is not capable of giving or withholding consent, or
(iii) is unreasonably withholding consent,
Subject to any conditions, including provision of other comparable accommodation or payment in place of it, that the court considers appropriate; …
(d) direct[ing] the setting aside of a transaction disposing of or encumbering an interest in the matrimonial home contrary to subsection 21(1) and the revesting of the interest or any part of it on the conditions that the court considers appropriate.
[14] Based on the most recent municipal property tax assessment, it is Mrs. Norris’ belief that the value of the matrimonial home is $478,000. The home is said to be unencumbered, other than with respect to the Line. In her October 2016 affidavit, Mrs. Norris sets out her position with respect to the issue of an equalization payment. It is her position that she is entitled to an equalization payment of approximately $510,000 from Mr. Norris. Taking into consideration that the matrimonial home is the couple’s only significant asset, she questions how Mr. Norris will make the equalization payment if ordered in an amount approaching the amount calculated by Mrs. Norris.
[15] Mr. Norris’ position is that Mrs. Norris is not entitled to any of the alternative relief she seeks. He relies in part on what he alleges is historical misconduct on the part of Mrs. Norris. He also submits that it is not possible to grant the types of relief Mrs. Norris is seeking because to do so fails to take into consideration such issues as occupation rent for the 7.5 years during which Mrs. Norris has been living in the matrimonial home. Mr. Norris also takes the position that Mrs. Norris essentially ‘slept’ on her rights by failing, prior to this motion, to seek relief with respect to the matrimonial home.
[16] Mr. Norris proposes that Mrs. Norris purchase his interest in the home. Mr. Norris also raises the potential for the matrimonial home to be partitioned and sold. However, he is not pursuing that form of relief at this time, if at all.
[17] In reply, Mrs. Norris points out that Mr. Norris has not included in the relief set out in his notice of application a claim for either of occupation rent with respect to or partition and sale of the matrimonial home.
Analysis
a) Vesting Order
[18] In considering the alternative forms of relief sought by Mrs. Norris with respect to the matrimonial home, I emphasize the introductory portions of s. 9(1) and of s. 9(1)(d) of the FLA.
[19] Section 9(1) begins with, “[i]n an application under section 7, the court may order …” As a result, before the Court considers which, if any, of the forms of relief set out in sub-sections (a) to (d) might be granted, there must first be an order pursuant to ss. 5 or 7 of the FLA providing for an equalization payment or other relief related to net family property.[^6] That such an order must exist is reinforced by the introductory wording of s. 9(1)(d) of the FLA: “that, if appropriate to satisfy an obligation imposed by the order …”
[20] In its recent decision in Buttar v. Buttar[^7] the Ontario Court of Appeal considered the powers granted to this Court pursuant to section 9 of the FLA. Writing for the Court, Rosenberg J. said:
The scheme of the Act does not support the proposition that an application judge can simply redistribute properties among the parties. To interpret the Act in this way would be inconsistent with its overall scheme, which gives a judge only a very limited power to distribute properties in the circumstances set out in s. 9. That is, section 9 gives the court the power to transfer properties only “if appropriate to satisfy an obligation imposed by the order [for equalization of net family properties]”. In other words, the transfer power under section 9 is specifically connected to the satisfaction of the order for the equalization of net family properties rather than a general transfer power for the settlement of disputes arising from marital breakdown.[^8]
[21] Even before the Court of Appeal decision in Buttar, it was recognized by this Court that s. 9 of the FLA is “simply an enforcement mechanism and nothing else [which] gives the court the power that is necessary to enforce its substantive order for an equalization payment.”[^9]
[22] The majority of the cases relied on by Mrs. Norris do not support granting as interim relief a vesting order or an order permitting the transfer of the matrimonial home to one spouse. Those cases involve a final determination of property issues. At least three of the cases involve a final determination of property issues on an uncontested basis.[^10] In another of the cases, a vesting order was made on the consent of the parties following the determination of the equalization payment issue.[^11]
[23] In only one of the cases relied on by Mrs. Norris was an order made pursuant to s. 9 of the FLA, transferring title of the matrimonial home to one spouse, on the basis of an interim order. In Verch v. Verch,[^12] Abrams J. made an order, on an interim motion, for title of the matrimonial home to be vested in Mrs. Verch. An equalization payment had not yet been ordered. The circumstances in Verch are distinguishable from the matter before me.
[24] Mrs. Verch was not on the title to the matrimonial home. She had been granted exclusive possession of the home. Mr. Verch was ordered to pay the property taxes. Mr. Verch failed to do so. Mrs. Verch was not in a position to pay the property taxes herself. The couple were at risk of losing the matrimonial home – their most significant asset – to a tax sale proceeding.
[25] In that scenario, in light of historical behaviour on the part of Mr. Verch, and out of concern that Mr. Verch would continue to disregard orders of the Court, Abrams J. made the vesting order. The historical behaviour of Mr. Verch included the failure of Mr. Verch to pay the sum of $143,760 into Court. In response to a contempt motion based on that failure, Mr. Verch had consented to certain other relief.
[26] Abrams J. concluded that Mrs. Verch had a valid claim to ownership in the home which fell within this Court’s “broad general power to protect and preserve [property] pending the outcome of [the] litigation.”[^13] At para. 39 of his decision, Abrams J. said “I am persuaded that a Vesting Order is necessary to ensure compliance with that obligation and to ensure that the matrimonial home is protected pending the final outcome of this litigation.”
[27] In making the order, Abrams J. also took into consideration the integrity of the administration of justice. He concluded as follows:
It is axiomatic that a party ought not be allowed to create a payment liability to be dealt with in the final determination of the family law litigation, then refuse to pay the outstanding property taxes so that the house is sold, and thereby potentially avoid the obligation to pay the other party. The result would harm the integrity of the administration of justice.[^14]
[28] Abrams J. also relied on rr. 1(8) and 14(23) of the Family Law Rules.[^15] The effect of those rules, when read together, is that when one party fails to follow the Family Law Rules or fails to obey an order, the Court has the discretion to “make any order that it considers necessary for a just determination of the matter, on any conditions, that the court considers appropriate”.[^16]
[29] The circumstances of Mrs. Norris are distinguishable from those of Mrs. Verch:
• Mrs. Verch was not on title to the couple’s matrimonial home. Mrs. Norris is on title and, as a result, has the protection afforded a spouse with respect to title to the property.
• Mrs. Verch was unable to secure financing to pay the $8,500 (approximate amount) owing in property taxes. There is no evidence that Mrs. Norris is unable to pay down the Line on the existing terms. She has waited since the couple separated, in 2008 or 2009, to bring the motion for interim relief with respect to the payment of that debt.
• Without an insurable interest in the matrimonial home, Mrs. Verch was unable to obtain home insurance for the home in which she and the couple’s children were living. There is no evidence in the matter before me that Mrs. Norris is unable to obtain home insurance.
• The Verch home was said to be worth in excess of $350,000 and for the most part be unencumbered. Based on the evidence of Mrs. Norris, the Norris’ home appears to be worth more than $350,000. However, it is encumbered by the Line.
• Prior to the order being made requiring Mr. Verch to pay the property taxes, an order had been made granting Mrs. Verch exclusive possession of the matrimonial home. An order for exclusive possession has not been made in the matter before me. An order to that effect is requested as alternative relief. See the discussion in section (b) below.
[30] In my view, the order of Abrams J. was an enforcement order, as is contemplated by section 9 of the FLA. His order was in keeping with the criteria set out in Lynch, referenced at para. 10, above.
[31] In my view, unless and until an order for an equalization payment or some other order dealing with the matrimonial home is made, and the other criteria from Lynch are met, I do not have the power to make an order pursuant to s. 9 of the FLA vesting title of the matrimonial home in Mrs. Norris. The request for a vesting order is dismissed. The request for an order transferring title of the matrimonial home to Mrs. Norris is also dismissed.
b) Re-Financing the Matrimonial Home
[32] As noted in my February 1, 2016 endorsement, the parties are in agreement that the Line is to be re-financed, with a consolidated principal amount of $187,000. However, the parties disagree on the terms pursuant to which the re-financing is to be carried out.
[33] Mrs. Norris relies on ss. 21 and 23 of the FLA. She requests an order pursuant to s. 21(2) of the FLA setting aside the encumbrance of the matrimonial home which she alleges was obtained by Mr. Norris without her consent. Alternatively, she requests an order pursuant to s. 23 dispensing with the requirement for Mr. Norris to consent to re-financing the Line. As noted earlier in this endorsement, Mrs. Norris estimates that she will be able to reduce the monthly payments by $600 if she is able to re-finance the Line.
[34] It is Mr. Norris’ evidence that Mrs. Norris closed the couple’s joint accounts and transferred $289,000 from those accounts for her use personally. His evidence is that in response to that conduct he registered the Line in the amount of $150,000 against the matrimonial home.
[35] Given the significant contradictions with respect to the handling of the couple’s assets, including joint bank accounts, I am not prepared on the basis of the evidence before me to set aside the Line.
[36] The evidence with respect to Mrs. Norris’ inability to re-finance the matrimonial home because of the financial institution’s concerns about Mr. Norris credit history is less than satisfactory. That evidence is hearsay, in as much as Mrs. Norris relies entirely on information provided to her by an individual, whose name Mrs. Norris identifies, with the Bank of Montreal (“the Bank”). There is no documentation from the Bank. During submissions, counsel for Mrs. Norris advised that documentation was requested; however, the Bank provides only confirmation of financing. It does not confirm in writing when a request for financing or re-financing is declined.
[37] It is clearly in the interests of both parties that the expense incurred to pay the Line and other debt to which Mrs. Norris refers in her October 2016 affidavit be reduced. Having Mrs. Norris continue to pay $600 more per month than is necessary towards reducing the encumbrance on the home only serves to negatively affect the ability of either party to make an equalization payment if and when ordered to do so. The equity in the home is not increasing as quickly as it would if the $600 per month, or some portion of that amount, were applied towards reducing the principal amount of the Line and other debt. Increasing the equity in the matrimonial home is to the benefit of both spouses because the home is the most significant asset that they have.
[38] In all of the circumstances, it is reasonable for Mrs. Norris to proceed with re-financing the matrimonial home to a maximum of $187,000. The assistance the Court is in a position to give her in that regard at this time is to dispense with the requirement for Mr. Norris to consent to the re-financing. With that relief granted, neither Mrs. Norris nor the Bank will be required to rely on Mr. Norris to co-operate with respect to the re-financing.
[39] I am, however, concerned as to whether an order dispensing with the consent of Mr. Norris to re-financing the matrimonial home will be sufficient for the Bank’s purposes. Mrs. Norris’ evidence is that she was advised by the individual at the Bank with whom she has been dealing that, “due to the Applicant’s poor credit history, [she] will not receive financing unless the matrimonial home is transferred into [her] name alone.” It is also Mrs. Norris’ evidence that she approached other lenders and was denied re-financing for the same reason.
[40] In an effort to address the concerns expressed by the Bank regarding Mr. Norris’ poor credit history, I also order that:
a) Neither party shall have the ability to encumber title to the matrimonial home, other than as provided in this endorsement, without further order of the Court; and
b) A copy of the order issued and entered pursuant to this endorsement shall be registered on title to the matrimonial home.
[41] The relief granted in this endorsement may not be sufficient for the Bank’s purposes. If that turns out to be the case, then Mrs. Norris will be required to bring the matter before the Court again and rely on additional evidence in support of additional relief sought. In anticipation of that scenario, Mrs. Norris is granted leave to bring a further motion, before any Judge of this Court, related to re-financing the Line in the event the relief granted pursuant to this endorsement is insufficient to allow her to obtain the re-financing permitted by this endorsement.
[42] As noted above, there are significant contradictions in the affidavit evidence of the parties with respect to their individual handling of joint assets. The parties were not cross-examined on their respective affidavits. As a result, I am unable to make findings of credibility required for me to address Mrs. Norris’ request for reimbursement of monies paid by her towards the Line and the principal amount of the Line.
[43] The motion for the alternative relief requested at paragraphs 4(e) and (f), above, is dismissed.
Issue No. 2: Exclusive Possession
[44] In support of her request for an order that she be granted exclusive possession of the matrimonial home, Mrs. Norris relies on s. 24 of the FLA. It is Mrs. Norris’ uncontradicted evidence that she intends to remain in the home, including after she retires in the next several years. The couple’s daughter continues to live in the home with Mrs. Norris. It is Mrs. Norris’ intention that the home be bequeathed to the couple’s children.
[45] Mrs. Norris relies on the decision of this Court in Groulx v. Groulx as support for her entitlement to an order for exclusive possession at this time.[^17] Like the majority of the decisions relied on by Mrs. Norris, the decision in Groulx is a final one. The order for exclusive possession, together with an order removing Mr. Groulx from title, was made after consideration of the equalization payment issue, including a request on behalf of Mrs. Groulx, pursuant to s. 5(6) of the FLA, for an unequal division of net family property. The relief with respect to the matrimonial home was granted at the same time that an order for divorce was made.
[46] Until the date of separation and equalization payment, the latter if any, are determined, it would in my view be inappropriate to grant Mrs. Norris exclusive possession of the matrimonial home.
[47] Reference is made in the Factum to a request on behalf of Mr. Norris for partition and sale of the matrimonial home. There is, however, no motion on his behalf before me in which that or any other relief is requested. In addition, the notice of application does not include a request for partition and sale of the matrimonial home. In the supplementary materials filed on behalf of Mr. Norris, it is acknowledged that he requires leave of the Court to bring a motion for partition and sale of the matrimonial home. There is no indication as to whether Mr. Norris intends to bring a motion for leave in that regard.
[48] In any event, I find that it would be unfair to Mr. Norris to make an order which defeats his right, as a joint owner, to pursue partition and sale of the matrimonial home. His rights in that regard are not to be lightly interfered with. [^18]
[49] The motion for an interim order for exclusive possession of the matrimonial home is dismissed.
Issue No. 3: Fixed Periodic Payments
[50] It is the uncontradicted evidence of Mrs. Norris that she has, for approximately 7.5 years, been paying the sum of $1,329 per month to pay down the principal and interest owed on the Line. The monthly payments include an interest component based on a fixed rate of interest set at nine per cent per year when the Line was obtained by Mr. Norris.
[51] Mrs. Norris relies on ss. 34(1)(a) and (e) of the FLA, which provide as follows:
In an application under section 33, the court may make an interim or final order,
(a) requiring that an amount be paid periodically, whether annually or otherwise and whether for an indefinite or limited period, or until the happening of a specified event; …
(e) requiring that some or all of the money payable under the order be paid into court or to another appropriate person or agency for the dependant’s benefit.
[52] Mrs. Norris addresses the tax consequences of the payment of spousal support to a third party by referring to a text with respect to income tax in the family law context and to the Federal Income Tax Act. [^19] Mrs. Norris refers to these materials in support of her position that periodic payments made to a third party may be considered as spousal support and have the same consequences, from a tax perspective, as would support payments made directly to Mr. Norris.
[53] Even if it is assumed that the $1,329 paid from January 1, 2015 forward is spousal support, I am not satisfied based on the materials before me that the payments, if made to a third party, have the tax consequences proposed by Mrs. Norris; namely that the payments are tax deductible to her and taxable to Mr. Norris. In the text reference provided, it is stated that the payments will be deductible for the payor and taxable to the recipient spouse “if they have the features noted below.”[^20] Under the heading of “Features Required to be Deductible”, the following criteria are listed:
Third party payments will be deductible by the payor and taxable to the recipient if the payments have the following features:
The nature of the third party payment must be specified in a court order or a written agreement.
Both parties must agree that the third party payments will be deductible by the payor and taxable to the recipient.
The court order or written agreement should specifically refer to the intention of the parties to have subsection 60.1(2) and 56.1(2) of the Income Tax Act apply to the payments. This specific reference must be made in the court order or the written agreement.*
The payments are:
a) made before a commencement day or pursuant to court orders or written agreements without a commencement day and are for the maintenance of the spouse, former spouse or dependant children in the custody of the spouse or former spouse; or
b) made after a commencement day and are solely for the maintenance of the spouse or former spouse. Further, the third party payments must be clearly identified in the order or agreement as being solely for the benefit of the spouse or former spouse.
- The parties must be living separate and apart, not only when the payment is made, but also at the time the expense is incurred.
- Specific reference may not be required provided that the court order or written agreement contains a clear and unambiguous clause that the parties understand that the third party payments will be deductible / taxable.
[54] The five criteria listed above appear to apply without exception to both court orders and written agreements. The second criterion is mandatory – both parties “must agree” to the proposed tax treatment of the payments. The third criterion, although not mandatory (“should” is the verb used), is to be read in conjunction with the wording of the related commentary. If the written agreement or court order does not contain reference to the parties’ stated intention with respect to the tax treatment, then the agreement or order is to contain clear and unambiguous wording confirming that the parties understand the tax treatment to be given to the payments.
[55] I am not satisfied on the evidence before me that if I were to order that the historical and future payments towards the Line are treated as spousal support payments then they would receive the tax treatment applicable to spousal support payments made in the ordinary course of a family law proceeding. Given the contents of the text reference upon which Mrs. Norris relies, expert evidence is required from an expert in the field of income tax to confirm that if granted, the relief requested would result in the tax treatment applicable to spousal support payments, made in the ordinary course, even though Mr. Norris does not consent to the relief in that regard.
[56] The motion for an order that the historical and future payments towards the Line be treated as spousal support, with the consequent tax treatment to each of the parties, is dismissed.
Additional Relief Requested
a) Striking Paragraphs of the Applicant’s Factum
[57] In the notice of motion filed on behalf of Mrs. Norris, a request is made for summary judgment in the form of a declaration that the date of separation is February 17, 2008. The motion for summary judgment is based on a request to admit served in September 2016 and to which no response to request to admit was delivered.
[58] In response to the motion for summary judgment, counsel for Mr. Norris delivered a factum (“the Factum”). A request is made in the Factum for an order dismissing the motion for summary judgment and awarding costs against counsel for Mrs. Norris personally. The contents of the Factum in turn generated a request on behalf of Mrs. Norris for an order that portions of the Factum be struck.
[59] The request for paragraphs 48 to 53 of the Factum to be struck is based on r. 1(8.2) of the Family Law Rules. That rule provides as follows, “The court may strike out all or part of any document that may delay or make it difficult to have a fair trial or that is inflammatory, a waste of time, a nuisance or an abuse of the court process.”
[60] The impugned paragraphs relate to the service of a request to admit and the reliance, in support of the motion for summary judgment, on the failure of Mr. Norris to respond to same within the 20-day period provided for same or at all. The impugned paragraphs include commentary questioning the competence and professionalism of counsel for Mrs. Norris.
[61] The procedural history of the motion on behalf of Mrs. Norris for relief related to the matrimonial home is relevant to the additional relief requested by the parties. The issues with respect to the matrimonial home were first before me in January 2016 but not determined at that time. The delay in the matter being before the Court once again was entirely beyond the control of counsel and the parties. The October return date was agreed upon with counsel when the matter was spoken to in September 2016. The October 2016 date was set for the return of Mrs. Norris’ motion for relief with respect to the matrimonial home. At the same time the January 2017 date was set for the Rule 2 trial with respect to the date of separation.
[62] The October 2016 date was intended exclusively for the motion for relief with respect to the matrimonial home. An hour was set for the hearing of the motion. When the matter was spoken to in September, counsel were advised that a factum was not required for the return of the motion.
[63] It was, in my view, a matter of strategy for counsel for Mrs. Norris to include in the relief requested in the notice of motion served, summary judgment with respect to the date of separation with that relief based on the request to admit to which Mr. Norris did not respond.
[64] For a number of reasons, counsel for Mrs. Norris could not have been certain that the motion for summary judgment would be heard on October 21, 2016. For example, a request for an adjournment of the motion in its entirety could have been made on behalf of Mr. Norris if Mrs. Norris insisted on proceeding with the motion for summary judgment at the same time that the motion with respect to the matrimonial home was heard. I note that a request for an adjournment of the entire matter was not one of the forms of relief requested in the Factum.
[65] There was also the possibility that the Court would refuse to hear the motion for summary judgment given that the date and amount of time for the motion with respect to the matrimonial home had been agreed upon by counsel in September 2016. This is in fact what happened. I declined to hear and adjourned the motion for summary judgment. That motion is to be pursued on a date prior to or at the commencement of the Rule 2 trial scheduled for January 2017, if the motion is pursued at all.
[66] The conduct of litigation requires strategic thinking. A strategic step taken requires a strategic response. The latter does not, in my view, include inflammatory remarks with respect to the conduct of opposing counsel. In that regard, I refer to the “Commentary” section of rule 7.2 of the Rules of Professional Conduct. The following guidelines for conduct as between counsel are set out:
Personal remarks or personally abusive tactics interfere with the orderly administration of justice and have no place in our legal system…
A lawyer should avoid ill-considered or uninformed criticism of the competence, conduct, advice, or charges of other legal practitioners, but should be prepared, when requested, to advise and represent a client in a complaint involving another legal practitioner.
[67] Nor does a strategic response include the reference, in a factum dealing with substantive issues, to a request for costs personally against opposing counsel. The appropriate point at which to deal with costs, including a request for costs against counsel personally, is following the determination of the substantive issues and when invited by the Court to address the issue of costs. A specific procedure is to be followed when a request is made for costs against counsel personally. That procedure was not followed in this matter including that the request made was ill-timed.
[68] In all of the circumstances, I find that the contents of paragraphs 48 to 53 of the Factum are inflammatory within the meaning of r. 1(8.2) of the Family Law Rules. Those paragraphs are to be struck from the record.
b) Response to Request to Admit
[69] During submissions on behalf of Mr. Norris a request was made for an order extending the deadline by which he is to file a response to the request to admit served in September 2016. In his affidavit sworn on October 16, 2016 Mr. Norris provides some explanation as to why a response to request to admit was not delivered within the 20-day period prescribed by the Family Law Rules. The explanation provided is minimal and does not support the relief requested.
[70] As noted above, I recognize that it was a matter of strategy for counsel for Mrs. Norris to (a) serve a request to admit and (b) in support of a motion for summary judgment rely on the failure of Mr. Norris to respond to same. That strategy involved a strict adherence to timelines set out in the Family Law Rules. ‘Technically’ there is merit to Mrs. Norris’ reliance on the failure of Mr. Norris to deliver a response to request to admit. However, the interests of justice must be considered.
[71] The primary objective of the Family Law Rules is “to enable the court to deal with cases justly.”[^21] Dealing with cases justly includes the following:
(a) ensuring that the procedure is fair to all parties;
(b) saving expense and time;
(c) dealing with the case in ways that are appropriate to its importance and complexity; and
(d) giving appropriate court resources to the case while taking account of the need to give resources to other cases.[^22]
[72] The Court is mandated to apply the Family Law Rules so as to promote the primary objective. In addition, counsel are required to assist the Court in promoting the primary objective.[^23]
[73] In support of the motion for summary judgment, Mrs. Norris seeks to rely on deemed admissions arising from the failure of Mr. Norris to deliver a response to request to admit. The deemed admissions are central to the issue of the date of separation. If that issue is decided in Mrs. Norris’ favour, Mr. Norris’ claim for an equalization payment is out of time. In summary, if Mr. Norris is not granted leave to deliver a response to request to admit, his lack of success on a motion for leave in that regard is likely to lead to his claim for an equalization payment being statute-barred.
[74] In all of the circumstances, I find that the primary objective of the Family Law Rules would not be promoted if I were to determine the request for an extension of the deadline within which to deliver a response to request to admit without:
a) Requiring that a notice of motion be served on behalf of Mr. Norris and that the relief requested is particularized;
b) Giving Mr. Norris the opportunity to rely on fulsome evidence explaining the failure to deliver a response to request to admit within the time period prescribed by the Family Law Rules; and
c) Giving Mrs. Norris the opportunity to respond, should she choose to do so, to the relief requested including by way of responding affidavit materials and/or cross-examination on the affidavit(s) relied on by Mr. Norris.
[75] Mr. Norris is granted leave to bring a motion for an order extending the deadline within which to deliver a response to request to admit. Whether or not that deadline is extended is relevant to the conduct of the Rule 2 trial in January 2017 and to the motion, if pursued by Mrs. Norris, for summary judgment. As a result, the motion on behalf of Mr. Norris for an order extending the deadline within which to deliver a response to request to admit shall be heard prior to the end of the 2016 calendar year.
[76] I am seized of this matter to the extent that I shall be hearing the Rule 2 trial in January 2017. My schedule is such that I am not sitting in Ottawa for the balance of 2016. As a result, it is not possible for me to hear the motion on behalf of Mr. Norris with respect to the deadline for a response to request to admit. Therefore, the motion is to be brought before any Judge of this Court.
Disposition
[77] In summary, I order as follows:
- Mrs. Norris is entitled to re-finance the matrimonial home on the following terms:
a) The maximum amount for which she is entitled to re-finance the matrimonial home is $187,000; and
b) The requirement for the consent of Mr. Norris to the re-financing is dispensed with.
The balance of the motion on behalf of Mrs. Norris, other than the motion for summary judgment, is dismissed.
The motion for summary judgment based on the request to admit served in September 2016 it adjourned to be brought back before the Court:
a) Following a determination of the motion on behalf of Mr. Norris for an extension of the deadline by which to deliver a response to request to admit;
b) At or prior to the beginning of the Rule 2 trial scheduled for January 2017; and
c) In accordance with the Family Law Rules, unless a further order of the Court is made providing for relief related to the timing of delivery of materials on the motion for summary judgment.
Neither party shall encumber title to the matrimonial home, other than as provided in this endorsement, without further order of the Court.
A copy of the order issued and entered pursuant to this endorsement shall be registered on the title to the matrimonial home.
Mrs. Norris is granted leave to bring before any Judge of this Court a motion for further relief related to re-financing of the matrimonial home in the event she is unable to obtain re-financing based on the terms of the order issued and entered pursuant to this endorsement.
Paragraphs 48 to 53 of the factum dated October 21, 2016 filed on behalf of Mr. Norris (“the Factum”) shall be struck from the record. Mr. Norris shall, within 10 days of the date of this endorsement, take the steps necessary for the impugned paragraphs of the Factum to be struck.
Mr. Norris is granted leave, on the following terms, to bring a motion for an order extending the deadline by which a response to request to admit shall be served:
a) The return date for the motion shall be prior to the end of the 2016 calendar year;
b) The motion may be made before any Judge of this Court;
c) The deadline requested for the delivery of a response to request to admit shall be at least 20 days prior to the date on which the Rule 2 trial with respect to the date of separation is scheduled to proceed;
d) The evidence filed in support of the request for extension of the deadline shall provide the Court with a fulsome explanation as to why a response to request to admit was not served within the 20 days provided by the Family Law Rules; and
e) The notice of motion, supporting affidavit(s), responding affidavit(s), and reply affidavit(s), the latter two if any, shall be served and filed in accordance with the Family Law Rules.
Costs
[78] In accordance with my endorsement dated February 1, 2016, the costs of the portion of the motion and cross-motion heard in January 2016 and of the matters heard in October 2016 shall be determined by the judge who conducts the trial of the balance of the application.
Madam Justice S. Corthorn
Date: November 21, 2016
CITATION: Norris v. Norris 2016 ONSC 7077
COURT FILE NO.: FC-15-240
DATE: 2016/11/21
SUPERIOR COURT OF JUSTICE – ONTARIO
FAMILY COURT BRANCH
RE: Anderson Llewlyn Norris, Applicant
AND
Ellen Seville Norris, Respondent
BEFORE: Madam Justice S. Corthorn
COUNSEL: Michael Rappaport, Counsel for the applicant (respondent party)
Steven Fried, Counsel for the respondent (moving party)
ENDORSEMENT
Madam Justice Sylvia Corthorn
Released: November 21, 2016
[^1]: The figure of $187,000 is based on the $126,000 owing on the Line, a balance of $24,000 on a Bank of Montreal MasterCard, and $37,000 on a CIBC Visa. The Visa has an interest rate of 20 per cent per year.
[^2]: It is Mr. Norris’ position that the date of separation is July 2009. Mrs. Norris’ position is that the date of separation is February 2008.
[^3]: R.S.O. 1990, c. C.43.
[^4]: R.S.O. 1990, c. F.3.
[^5]: Lynch v. Segal (2006), 2006 CanLII 42240 (ON CA), 82 O.R. (3d) 641 at paras. 32 − 33, leave to appeal refused [2007] S.C.C.A. No. 84 (S.C.C.).
[^6]: Morrison v. Barclay-Morrison, 2008 CanLII 60330 (ON SC), [2008] O.J. No. 4663 (S.C.J.), at para. 105.
[^7]: (2013), ONCA 517, 2013 ONCA 517, 116 O.R. (3d) 481.
[^8]: Buttar, at para. 53.
[^9]: Maguire v. Maguire, 2003 CanLII 64334 at para. 14 (Ont. S.C.); and Batler v. Batler (1988), 1988 CanLII 4726 (ON SC), 67 O.R. (2d) 355 (H.C.J.).
[^10]: Barker v. Barker, 2011 ONCA 447, 278 OAC 395; Kennedy v. Sinclair (2001), 2001 CanLII 28208 (ON SC), 18 RFL (5th) 91 (Ont. S.C.); Morrison, supra; Pathmalingam v. Pathmalingam, 2013 ONSC 4284; Sutchy v. Sutchy, 2013 ONSC 160; Aning v. Aning, 2002 CanLII 78071 (ON SC), [2002] O.J. No. 2469, 30 R.F.L. (5th) 237 (S.C.J.); Filipponi v. Filipponi (1992), 1992 CanLII 14009 (ON SC), 40 R.F.L. (3d) 296 (Ont. Ct. Gen. Div.); and Misner v. Misner, 2010 ONSC 2284.
[^11]: Caracciolo v. Ruberto 2010 ONSC 525, at para. 62.
[^12]: 2012 ONSC 2621.
[^13]: Verch, at para. 42.
[^14]: Verch, at para. 37.
[^15]: O. Reg. 114/99.
[^16]: Verch, at para. 48.
[^17]: [1990] O.J. No. 1299 (H.C.)
[^18]: Arlow v. Arlow (1990), 1990 CanLII 12267 (ON SCDC), 27 R.F.L. (3d) 348 at para. 8 (Ont. Dis. Ct.), aff’d (1991), 1991 CanLII 12940 (ON CA), 33 R.F.L. 3d 44 (Ont. C.A.).
[^19]: For the text reference, see Duff and Phelps, The Tax Principles of Family Law, Twentieth Edition, 2013. For the statute, see R.S.C. 1985, c. 1 (5th Supp.).
[^20]: The Tax Principles of Family Law, at p. 14.
[^21]: Rule 2(2) of the Family Law Rules.
[^22]: Rule 2(3) of the Family Law Rules.
[^23]: Rule 2(4) of the Family Law Rules.