CITATION: Henderson v. Henderson, 2017 ONSC 1340
COURT FILE NO.: FS-00-41034-01
DATE: 2017 02 13
CORRECTED: 2017-02-28
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: SCOTT HENDERSON, APPLICANT
AND:
SUZANNE HENDERSON, RESPONDENT
BEFORE: BARNES J.
COUNSEL: S. Shore, Counsel for the Applicant
L. Ben-Eliezer, Counsel for the Respondent
CORRECTED ENDORSEMENT
INTRODUCTION
[1] The Applicant (Mr. Henderson) has a pending motion to change the final order of Justice van Rensberg (as she then was) dated January 15, 2009.
[2] Due to Mr. Henderson’s non-compliance with several orders of the Ontario Superior Court of Justice, Barnes J. on February 5, 2014 stayed Mr. Henderson’s Motion to Change, pending the satisfaction of certain conditions precedent. Failure to comply meant that Mr. Henderson’s Motion dated February 12, 2014 was to be permanently stayed with prejudice: Henderson v. Henderson, 2014 ONSC 7568.
[3] The conditions precedent were to be satisfied by June 30, 2014. It is not in dispute that Mr. Henderson breached the February 5, 2014 Order (the Order) by failing to meet the deadline of June 30, 2014.
[4] There is disagreement about whether Mr. Henderson ever satisfied the conditions set in the Order. The Respondent (Ms. Henderson) submits that Mr. Henderson has failed to satisfy the Order. Mr. Henderson submits that he has.
[5] As per the terms of the Order, should I conclude that Mr. Henderson has failed to comply with the terms of the Order his February 5, 2014 Application shall be permanently stayed unless I vary the terms of the Order. Mr. Henderson and Ms. Henderson agree that I should vary the terms of my previous Order to permit Mr. Henderson’s February 12, 2014 Motion to proceed. The parties disagree on what consequence Mr. Henderson should face/or what new conditions Mr. Henderson should meet before the stay is lifted.
ISSUES
[6] The material filed and the submissions of counsel raise these broad issues:
a) Can money collected under section 19 of the Family Responsibility and Support Arrears Act (the Act) be applied towards costs?
b) Is Mr. Henderson in breach of the February 5, 2014 Order of Justice Barnes?
c) If Mr. Henderson is in breach of the Order what is the most appropriate Sanction for the Breach?
[7] Section 19 of the Act is clear and unambiguous. Money collected under Section 19 of the Act shall be applied only towards child and/or spousal support arrears. Costs can be collected as support under Section 19 of the Act only in circumstances where a Court Order authorizes the collection of the costs as support as defined in subsection 1(1) of the Act. See G. (W.) v G. (K.) [2015] W.D.F.L. 5811; de Somer v Martin 22 R.F.L. (7th) 297.
[8] Ont. Reg. 454/07, s4 of the Act recommends the following standard term in circumstances where a Court intends a Cost order to be collected as support:
“Costs are fixed in the amount of $[insert amount], of which [insert amount] is related to support and is enforceable as support by the Director, Family Responsibility Office.”
[9] An important condition precedent in the Order was the payment of Costs awarded in the Ontario Courts by Mr. Henderson. These costs are aptly described by Ms. Henderson at paragraph 9 of her October 2, 2016 affidavit as follows:
“Scott [Mr. Henderson] has not paid the costs as ordered on February 5, 2014 (being a consolidation of the $26,954 due under the January 15, 2009 Order and costs due under the May 7, 2013 Order), the $40,000 of costs ordered on February 5, 2014 (which were to be paid within 60 days) or the costs ordered by the Court of Appeal on July 31, 2014 (in the amount of $24,000). Those costs total $100,954 plus interest. Those costs (but not the interest) have been added by FRO to the Statement of Arrears . . . . [emphasis added]”
[10] The total costs are $100,954.00 not including interest. Mr. Henderson submits that he has paid over $475,439 in support. Mr. Henderson explains that this includes the $100,954.00 in costs.
[11] Ms. Henderson submits that the total amount Mr. Henderson should have paid over the “past 32 months” i.e., since January 15, 2009 should have been $412,762.00. Ms. Henderson submits that this figure represents the total cost amount plus total periodic support payable. This is the meaning the Court is asked to ascribe to words in Ms. Henderson’s October 2, 2016 Affidavit, para. 11 (c) which suggest that Mr. Henderson has paid $412,762.00 over the “last 32 months”.
[12] Ms. Henderson submits that Mr. Henderson has only paid $310,022.00 in support arrears. Ms. Henderson says she had to incur $244,361 in legal costs in Arizona and Hong Kong in order to get Mr. Henderson to pay the support arrears.
[13] The dispute over the amount of money collected by the Family Responsibility Office (FRO) shall be resolved in accordance with the amounts collected to date as reported by FRO.
[14] FRO has included the $100,954.00 in costs in FRO’s calculation of support arrears. There is no Court Order authorizing FRO to collect the $100,954.00 (excluding interest) costs as support; therefore FRO’s action is unauthorized. An explicit Court Order authorizing such action is required: G. W., De Somers.
c) DID MR. HENDERSON BREACH THE ORDER?
[15] Section 19 of the Act does not authorize the collection of Costs as support absent an explicit Order of the Court authorizing such action. Therefore, I am satisfied beyond a reasonable doubt that Mr. Henderson is in breach: see: Bhavnagar v. Canada (Minister of Employment and Immigration) 2 S.C.R. 217; Sheppard v. Sheppard 120R. (2d) 4 (C.A.). The particulars of the breach are:
a) Failure to pay the Costs in accordance with the deadline set in the Order;
b) Failure to pay the Costs at all;
[16] Mr. Henderson did not comply with the Order by the June 30, 2014 deadline. It was open to him to seek variation of this deadline if there was a legitimate reason for the failure to do so he chose not to do so.
[17] FRO had to take action to collect support arrears. If Mr. Henderson wished to have the Ontario Cost Awards deducted as support he could have sought an Order of the Court to explicitly provide for this as required by de Somers and recognized by Ont. Reg. 454/07 s4 of the Act. Mr. Henderson took no such action.
[18] In effect, any payment of arrears (support) came as a result of FRO’s enforcement proceedings and not Mr. Henderson’s voluntary payment of the said arrears.
[19] The appropriate remedy under these circumstances is to permanently stay his motion as per the Order, however, two developments require me to consider a different remedy.
[20] First, Ms. Henderson consents to Mr. Henderson’s motion proceeding as long as certain conditions precedent are met. Second, FRO has included the cost award in the calculation of Mr. Henderson’s total support arrears. In addition at the time the various Cost Orders were made it was not anticipated that FRO action as well as legal action in jurisdictions outside Ontario would be required to ensure that Mr. Henderson paid the support arrears and the cost awards. For all these reasons, I will vary the Order and authorize FRO to collect the outstanding cost awards and any additional cost awards I impose as support. I will provide details of this order in the paragraphs that follow.
[21] Ms. Henderson submits that the stay on Mr. Henderson’s ability to bring his motion should be lifted only if these conditions are satisfied:
a) Payment of Ontario Cost Award inclusive of interest;
b) Payment of Cost Awards from California dated July 17, 2012;
c) Payment of Cost Award from Arizona dated August 10, 2015;
d) Payment of Cost Award in Hong Kong ordered in Spring 2015;
e) Payment of Cost Award from Ontario Court of Appeal dated August 1, 2014;
f) Payment of Cost Award for Court attendances on October 6 and 7, 2016.
[22] I have already rejected Mr. Henderson’s argument that he has paid the Ontario Cost Awards as per the Order. Mr. Henderson argues that this Court has no jurisdiction to order him to pay cost awards from other jurisdictions because this amounts to a re-litigation of issues addressed by Courts in other jurisdictions on the same issue (costs) before the Court involving the same parties. Mr. Henderson relies on the Ontario Court of Appeal decision Salazel v Cuthbertson, 2015 ONCA 115.
[23] Mr. Henderson invokes issue estoppel and therefore must demonstrate that these preconditions are met:
a) the issue before this court must be the same as the issue decided in the previous proceeding;
b) the prior judicial decision must be a final decision;
c) the parties to both proceedings [i.e. prior and current] must be the same. Toronto (City) v C.U.P.E. Local 79, 2003 SCC 63 at para. 23.
[24] This case is distinguishable from Salazel under the first precondition . . . the parties in Salazel sought to address the same issue i.e., costs. In this case the issue with respect to the decisions made in jurisdictions outside Ontario are not the same. The issue in those jurisdictions was what amount the parties should pay in costs and which party should pay costs as a result of proceedings in those jurisdictions.
[25] The issue before me is about this court controlling its own process. The issue is what sanction the court should impose in the face of a breach.
[26] The Cost Award as described in California, Arizona and Hong Kong are final. Any order made by this Court does not vary the quantum of those costs or determine who should pay them, etc. The decision before this Court is whether these final orders should be paid as a condition of Mr. Henderson’s ability to proceed with his motion before this Court. Therefore, the Court decision is about controlling its own process not about costs. The issue under consideration is different. The same issue is not being re-litigated. Ms. Henderson is not estopped from raising the issue.
[27] I will order the payment of the Cost Awards granted in California and Arizona as condition precedent to Mr. Henderson resuming his motion in the Court. Details provided below.
[28] I will not order the payment of any of the Hong Kong Cost Awards as there is still some other cost proceedings outstanding which may have a practical effect (possible set off) on the amount of costs paid by Mr. Henderson in practical terms.
[29] I will order Mr. Henderson to pay costs for the Court appearances on October 6 and 7, 2016 in accordance with the details below.
[30] The stay on Mr. Henderson’s motion shall be lifted if all of these conditions are satisfied by April 17, 2017:
- Payment of all outstanding Cost Awards as follows:
a) January 15, 2009 Order of van Rensburg J. (as she then was: $26,954.45 plus interest of $8,350.71 calculated from the date of the Order at 4% per the Order) = $35,306.15 (to the end of September 2016);
b) May 7, 2013 order of Snowie J.: $10,000.00, payable within 30 days, plus interest of $1,006.03 calculated at 3% from June 6, 2013 as per terms of the Order, to the end of September 2016) = $11,006.03;
c) February 5, 2014 Order of Barnes J.: $40,000.00 at 2% per annum to 30 September 2016) = $42,147.95;
d) August 1, 2014 Order of Juriansz J. A.: $24,000.00 at 2% per annum from date of order to end of September 2016) = $25,056.00;
e) Costs of October 6 and 7, 2016 appearances: $12,000.00 payable at an annual interest rate of 2%. This shall be paid from the $20,000 security for costs held in trust by Mr. Henderson’s counsel (Epstein Cole). Since the security for costs is held in trust by Epstein Cole, Espstein Cole shall pay these costs from the money held in trust within 20 days from February 28, 2017.
f) California Cost Order dated July 17, 2012: $20,300 US awarded to Ms. Henderson: calculated at 3% per annum interest rate calculated until the end of September, 2016. At an exchange rate of $1.32.00. Cost in Canadian dollars is $26,796.00 plus interest of $3,409.33 = $30,205.33;
g) Arizona Cost Award dated August 10, 2015. Ms. Henderson awarded $12,000.00 US in costs. Interest rate at 3% per annum. Exchange rate of $1.32 applied. Costs in Canadian Dollars: $15,840.00 plus interest of $594.98 = $16,434.98 (interest calculated to the end of September 2016);
h) Should Mr. Henderson fail to pay the Costs as ordered by April 17, 2017 the Family Responsibility Office (FRO) is authorized to collect the Cost Awards as support;
i) Costs are fixed in the amount of $172,156.44 [$35,306.15 + 11,006.03 + 42,147.95 + 25,056.00 + 12,000 + 30,205.33 + 16,434.98 = $172,156.44] of which the entire amount shall be collected as support after April 17, 2017;
j) The authority to collect the Cost Awards as support shall apply retroactively to January 15, 2009 and Mr. Henderson shall be credited for any Costs Awards already collected as support;
k) Mr. Henderson shall pay an additional $12,000.00 dollars to his counsel to replenish the $20,000.00 security for costs which will be depleted by the same amount pursuant to this Order;
l) Should Mr. Henderson fail to comply with all of the terms of this Order, his February 5, 2014 motion shall be permanently stayed on April 18, 2017 and he shall not bring any other motions in this litigation without leave of the Court.
BARNES J.
Date: February 28, 2017
CITATION: Henderson v. Henderson, 2017 ONSC 1340
COURT FILE NO.: FS-00-41034-01
DATE: 2017 02 13
CORRECTED: 2017 02 28
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Scott Henderson and Suzanne Henderson
BEFORE: BARNES J.
COUNSEL: S. Shore, for the Applicant
Lawrence Ben-Eliezer, for the Respondent
CORRECTED ENDORSEMENT
Barnes J.
DATE OF ENDORSEMENT: February 13, 2017
DATE OF CORRECTION: February 28, 2017