CITATION: Clark v. Moxley, 2017 ONSC 7610

COURT FILE NO.: FC-15-1451

DATE: 2017/12/19

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Heather Clark

Applicant

– and –

Neil Moxley

Respondent

Beverly Johnston, counsel for the Applicant

Self-Represented

HEARD: December 12, 2017

Endorsement

SHELSTON, J

Overview

[1] The applicant brings this motion seeking the following relief:

a) an order striking the respondent’s answer and claim pursuant to Rule 1(8) of the Family Law Rules for failure of the respondent to pay the costs award of $34,968.42;

b) In the alternative, an order, for the adjournment of the trial on the parenting issues pending the respondent’s compliance with the cost order and an order striking the respondent’s answer and claim as a relates to financial issues;

c) an order that the respondent pay security for costs in the amount of $10,000;

d) an order for costs of this motion on a full indemnity basis; and

e) such further and other relief as this honourable court may deem just.

[2] The respondent brings his own motion seeking the dismissal of the applicant’s motion and seeking costs.

[3] After receiving the respondent’s affidavit and notice of motion, the applicant filed an affidavit dated December 12, 2017 seeking to strike certain paragraphs of the respondent’s affidavit dated December 7, 2017 specifically paragraph 14 and exhibit E, paragraph 45 and paragraph 47(sentence three) on the basis that the evidence contained therein improperly refers to the contents of offers to settle and in the case of exhibit E, the actual offer to settle is filed.

Background Facts

[4] The parties married each other on June 18, 2004 and separated on November 15, 2010. There is one child of the marriage, Noah, born August 1, 2005. The applicant is a child protection worker and the respondent works for the Canada Border Services.

[5] On July 7, 2015, the applicant filed her application where she sought a divorce, custody of the child, a parenting regime including regular access to the respondent, retroactive and ongoing child support, an order the respondent contribute to the child’s section 7 expenses, an order seeking life insurance to secure the respondent’s child support obligation, an order that the respondent maintain the child as the beneficiary of his medical and dental coverage and costs.

[6] On August 24, 2015, the respondent filed an answer and claim where the respondent sought joint custody of the child, requested an week about schedule for the child, sought an order designating a specific school in a high school for the child, set off child support, and sharing of the section 7 expenses, mutual obligations for life insurance and medical and dental coverage, the equalization of the family law value of the parties pensions and costs.

[7] Since that time, there have been numerous court appearances such as:

a) September 10, 2015, Justice Roger rendered an order as to which school the child would attend, ordered the respondent to pay child support and sharing of the section 7 expenses and ordered costs the cause of $3000;

b) On December 9, 2015, the parties attended a case conference where they agreed to the appointment of the Office of the Children’s Lawyer(“OCL”), agreed to sever the divorce order from the corollary relief, consented to a financial disclosure order and set a date for settlement conference;

c) by divorce order dated January 28, 2016, the parties were divorced;

d) on April 20, 2016, the parties attended a settlement conference and the matter was placed on the November 2016 trial sittings;

e) the trial scheduled for the November 2016 trial sittings matter was adjourned to the January 2017 trial sittings due to the unavailability of the clinical investigator appointed by the OCL;

f) on January 9, 2017 a further settlement conference was held. At that time, the matter was removed from the January 2017 trial sittings due to respondent’s counsel not being unavailable due to a previously scheduled 10 day trial. At that time, Justice Doyle directed to the parties to seek a fixed date for a 5 to 7 day trial;

g) on March 3, 2017, a trial management conference was held where the court ordered that there would be a focused hearing to be heard on June 13 and 14^th 2017 to deal with three specific issues:

i. What school the child will be attending in September 2017?

ii. What parenting arrangements are in the child’s best interest?

iii. What custody arrangement is in the child’s best interest?

h) on May 29, 2017 Justice Doyle conducted a further trial management conference setting out the procedure for the focused hearing which included setting the time for examination in chief, the exchange of written affidavit material and other issues regarding the conduct of the focused hearing. At that time the parties agreed that custody would not be determined at the focused hearing, that the parties required a seven day fixed trial date and amended the issues to be determined as follows:

(i) What school should the child attend in September 2017? This decision will be a final decision.

(ii) What interim parenting arrangements are in the child’s best interest?

(iii) What activities the child be registered in for September 2017?

i) the matter proceeded for the focused hearing on July 7, 10 and August 11, 2017. At the third day of the hearing, the parties agreed that starting in September 2017 that the child would be enrolled in specific activities and consequently the scope of the focused hearing was to determine the child’s school and the interim parenting arrangements;

j) in her decision dated August 22, 2017, Justice Sheard did not change the interim parenting arrangements and accepted the applicant’s position as to which school the child should attend in September 2017;

k) on October 3, 2017, Justice Sheard ordered the respondent to pay the applicant the sum of $34,968.42 for costs related to the focused hearing;

l) the matter was placed on the January 2018 trial sittings;

m) on November 9, 2017, the applicant attended before Master Champagne who granted leave to bring a motion to strike the respondent’s pleadings for failing to pay the costs award as well as other claims for relief. The respondent was present at the motion; and

n) on December 12, 2017 the parties appeared before me. The trial is scheduled to proceed in the January 2018 trial sittings which start the week of January 15, 2018.

[8] With respect to the current arrangements for the child, the child lives primarily with the applicant and the respondent has defined access including every other weekend, one overnight visit each week and holidays. As well, every second Thursday from after school, that the respondent has the child at which time he is to do the child’s homework with him, take him to his extracurricular activities and bring him home half an hour before his bedtime.

[9] The applicant alleges that since the order of Justice Sheard, the respondent has not taken the child to activities on four of the five Thursdays and on two occasions kept the child overnight. Further he is not paying any part of the extracurricular fees. The respondent complains that the applicant registered the child for an activity on the Thursdays after he was awarded such access. Further, he argues that on one occasion the child was falling asleep and he decided not to return the child to the applicant.

[10] On November 9, 2017, after the parties appeared before Master Champagne, at 8:13 pm, counsel for the applicant wrote to the respondent requesting dates of availability for the motion. In a reply email sent at 8:30 pm on November 9, 2017 the respondent requested a response to his request to when he can start paying the cost order. He stated “I would like to start right away. Do I pay you? Or your client?” No reply was received.

[11] On November 22, 2017 respondent made an email transfer payment of $500 which was accepted by the applicant. The respondent has not made any further payments toward the cost award.

[12] The outstanding issues for trial are custody, parenting schedule, retroactive and ongoing child support and costs. The applicant estimates that the trial will last 10 days and that her estimated costs for legal fees for such a trial is $75,000. The applicant has already spent over $50,000 in legal fees and currently owes her lawyer $15,000. The applicant alleges that the respondent owes retroactive child support of $39,560. The applicant has exhausted her line of credit and borrowed money from her parents to pay her ongoing legal fees.

[13] The respondent was represented by counsel at the focused hearing. His previous counsel bill of costs presented to Justice Sheard was over $40,000. The respondent works as a border service agent and earns $70,000 per year. He denies that he owes any retroactive support based on evidence that he will present at trial.

[14] In the respondent’s affidavit dated December 7, 2017, at paragraph 14, he refers to two offers to settle that he submitted during this litigation. In paragraph 45, he refers to an offer made by the applicant and in paragraph 47, third sentence, he again refers to making another offer. It is improper for any litigant to disclose or refer to offers to settle while litigation is ongoing. Offers to settle are important when determining costs and should not be disclosed until such time.

Applicant’s Position

[15] The applicant’s position is that the respondent has not paid the costs award, is not contributing to the child’s expenses, is not taking the child to the tae kwon do classes every second Thursday and has made no efforts to attempt to pay the costs award. Based on the above the applicant seeks to strike the respondent’s answer and claim.

[16] Further she argues that the respondent’s claim is without merit and he should be required to make a payment of $10,000 as security for costs.

[17] Finally the applicant seeks to strike certain paragraphs of the respondent’s affidavit for disclosing offers to settle made in this proceeding.

Respondent’s Position

[18] The respondent’s position that there is a real need that the matter go forward because the many issues that he has raised were not provided to Justice Sheard at the focused hearing and none of his exhibits were provided to the court at that time. The respondent submits that if his answer is struck for trial it is likely that none of these issues will be addressed.

[19] The respondent argues that there were no dates or timeline in the costs award to indicate when the entire amount was to be paid. Further, he argues that the issue of costs at the trial will be determined at a later date and a portion of his costs award may be cancelled out by a positive costs award in his favour at the trial.

[20] The respondent argues that he has receipts from 2012 to deal with the issue of child support and section 7 expenses but that none of the interlocutory proceedings have dealt with financial issues. The respondent is paying $630 per month in child support. He indicates that if he pays $500 a month plus the child support it will cost him $1130 per month and should any more be ordered by the court, it would cripple him financially and would have a greater negative impact on his child.

[21] With respect to his financial circumstances, the respondent indicates that there is no equity in his home and that he is carrying significant debt for 2 ½ years of litigation. The respondent provided no updated financial statement, no evidence to support his contention that he has no equity in his home and has provided no evidence that he has applied for credit and has been refused.

Legal Framework

[22] Rule 1(8) of the Family Law Rules provides that if a person fails to obey an order in a case or a related case, the court may deal with the failure by making any order that it considers necessary for a just determination of the matter, including,

a) an order for costs;

b) an order dismissing a claim;

c) an order striking out an application, answer, notice of motion, motion to change, response to motion to change, financial statement, affidavit, or any other document filed by a party;

d) an order that all or part of a document that was required to be provided but was not, may not be used in the case;

e) if the failure to obey by a party, an order that the party is not entitled to any further order from the court unless the court orders otherwise,

f) an order postponing the trial or any other step in this case; and

g) on motion, a contempt order.

[23] Under Rule 1(8.4) of the Family Law Rules, if an order is made striking out a party’s application, answer, motion to change or response to motion to change in a case, the following consequences apply unless a court orders otherwise:

i. the party is not entitled to any further notice of steps in the case, except as provided by sub rule 25(13);

ii. a party is not entitled to participate in the case in any way;

iii. the court may deal with the case in the parties absence; and

iv. a date may be set for an uncontested trial of the case.

[24] The Court of Appeal has addressed the question of striking pleadings in family law cases in Chiaramonte v. Chiaramonte, 2013 ONCA 641 where the court stated at paragraphs 31 and 32:

31. In family law cases, pleading should only be struck, and trial participation denied, in exceptional circumstances and where no other remedy would suffice: Purcaru v. Purcara, 2010 ONCA 92, 75 R.F.L (6^th) 33, at para-. 47. The exceptional nature of this remedy is rooted in the significance of the adversarial system, as the Court recognize in Percaru, at para-49:

The adversarial system, through cross-examination an argument, functions to safeguard against injustice. For this reason, the adversarial structure of a proceeding should be maintained whenever possible. Accordingly, the objective of a sanction ought not to be the elimination of the adversary, but rather one that will persuade the adversary to comply with the orders of the court.

32. Striking a party’s pleadings is a drastic remedy that should only be applied in exceptional circumstances. The rules authorizing this remedy must be interpreted in light of the draconian effect of rule 10(5)(b). That rule provides that a respondent whose answer has been struck is not entitled to participate in the case in any way. For example, in Kim v. Kim reflex, 2004 CarswellOnt 502(ONSC), on the basis of rule 10(5)(b), an uncontested hearing was held on custody, support and property without further notice to the party whose pleadings had been struck. Similarly, in Costabile v. Costabile, reflex, 2004, CarswellOnt 4860(ONSC), a party whose pleadings had been struck was not entitled to notice of further proceedings nor was entitled to participate in any way.

[25] Where there were no children issues and that the husband had defied three orders for financial disclosure, the husband’s pleadings were struck. Roberts v. Roberts, 2015 ONCA 450, 2015 ONCA450 (Ont. C.A.)

[26] Where there are no children issues the courts’ have struck pleadings for nondisclosure, nonpayment of support, nonpayment of costs such as:

a) Where the respondent’s failed to disclose basic documents such as income tax return, financial statements, bank account statements, credit card statements and investment account statements, his pleadings were struck as the noncompliance was egregious. Manchanda v. Thethi, 2016 ONCA 909, 2016 ONCA909 (Ont. C.A.)

b) Where the trial was scheduled to proceed within two months and where the payor was in arrears of approximately $70,000 made up of $26,278 in arrears of support; arrears accumulated for nonpayment of an ongoing spousal support order of $2990 per month and a $6000 cost award, the court ordered the pay or to pay to the applicant $30,000 within 10 days of the decision ordered financial disclosure and adjourned the motion to strike the pay yours pleadings for 21 days. The court indicated that failing compliance with the detailed order, the court intended to strike the pleadings. Wehbe v. Wehbe, 2014 ONSC 6738.

[27] However, when the matter involves deciding the best interests of children, the Court of Appeal directs judges to proceed with caution before exercising their discretion to strike pleadings as the court requires the input of both parents to be able to determine the best interests of a child. In D.D. v. H.H., 2015 O. J. No 2959, the Court of Appeal stated the following with respect to the decision of a motion judge to strike a parent’s pleading any child -related matter:

78. In King v. Mongrain, this court explains that a full evidentiary record, including the evidence of both parents, is generally required in order for the court to determine the best interests of a child. At paras. 30-31, this court recognizes the power of family courts to strike pleadings but makes clear that it is preferable that such sanction be avoided when the matter to be decided is custody or access:

Courts should use the utmost caution in striking pleadings where children’s interests are involved and it is generally preferable to avoid using that sanction….. The reason for that admonition is simple--- in order to make custody and access decisions in the best interests of the child, the court needs the participation of both parties.(Emphasis added.)

80. Just as in King v. Mongrain, the one-sided presentation of evidence did not provide an adequate basis on which the motion judge, acting in accordance with the relevant statutory provisions, could determine that a final custody order in the respondent’s favour was in the child’s best interest.

81. This is not to suggest that family courts may never strike pleadings or that if struck, custody and access cannot be decided. Haunert-Faga v. Faga, (2005) 2005 CanLII 39324 (ON CA), 203 O.A C. 388(C.A.), is an example of a case in which court upheld the decision to strike pleadings in a family law case where custody was an issue. However, in that case, the Office of the Children’s Lawyer was representing the children’s interest in the proceedings. In the present case, no one represented the children.

Security for Costs

[28] Rule 24(13) of the Family Law Rules provides that a judge may, on motion, make an order for security for costs that is just, based on one or more of the following factors:

1. A party resides outside of Ontario.

2. A party has an order against the other party for costs that remains unpaid, in the same case or another case.

3. A party is a corporation and there is good reason to believe it does not have enough assets in Ontario to pay costs.

4. There is good reason to believe that the case is a waste of time or a nuisance and that the party does not have enough assets in Ontario to pay costs.

5. A statute entitles the party for security for costs.

[29] I agree and adopt the analysis of Justice Pazaratz in Izyak v. Bilousov, 2015 ONSC 3684(SCJ) were he summarizes the test to apply on deciding whether or not to order security for costs at paragraph 40:

40. The court must apply the following analysis:

a) The initial onus is on the party seeking security for cost to show that the other party falls within one of the enumerated grounds.

b) If the onus is met, the court has discretion to grant or refuse an order for security.

c) If the court orders security, it has a wide discretion as to the quantum and means of payment. Clark v. Clark, 2014 ONCA 175.

d) The order must be “just” and based on one or more of the factors listed in sub rule 24(13). Hodgins v. Buddha, 2013 O. J. No. 1261(OCJ)

41. A common theme in the case law suggest security for costs in custody and access cases should only be ordered in exceptional circumstances…..

42. But high conflict parenting disputes are often the most time-consuming, financially draining, and emotionally damaging cases we deal with in family court. Quite often the best gift we can give children is a break from the family siege mentality and perpetual stoking of conflict which accompanies endless litigation.

Analysis

[30] Court orders are to be followed. The respondent is not following the court order to pay the costs. The respondent has made one payment of $500 on November 22, 2017. I do not find that the applicant ever agreed to receive $500 a month on the costs award. I find that is very reasonable that she did not agree because it would take over 70 months for the respondent to pay the current costs award.

[31] Further, I reject the respondent’s submission as not being credible that he did not know when to pay the costs award. The respondent’s previous counsel filed a bill of costs that was considered by Justice Sheard after the focused hearing.

[32] I find that the respondent has failed to provide any evidence to support any alleged difficulties in paying the cost award. I find that the father has no intention of paying the costs award and intends to proceed to trial.

[33] With respect to the respondent not taking the child to the activity every second Thursday and the unilateral action of not returning the child home on two occasions, I do not find that these incidents justify striking the respondent’s answer and claim.

[34] As this case involves the custody of a child as well as financial issues. I must act cautiously when considering striking the respondent’s pleading as it would prevent the respondent from participating in the trial where the court is to consider the best interests of his child.

[35] I mindful of the directive from the Court of Appeal in Chiaramonte that the court should be focusing on proper sanction to ensure compliance with the court order.

[36] I also recognize that the court should be cautious in striking a pleading in a custody case but that principle is not without limit. (see D.D. v. H.H.).

[37] In this case, the OCL is involved and represents the child. Counsel for the OCL will be permitted to make submissions and file material to permit the court to make custody order based on the best interests of the child.

[38] I also have taken into consideration the litigation history in this matter including the fact that this matter was originally scheduled to be tried in November 2016 and January 2017. The matter was not tried in May 2017 and for that reason the focused hearing was determined as a necessary step.

[39] With respect to the request for security for costs, the only ground upon which I would consider ordering security for costs was the nonpayment of the costs award of Justice Sheard. However, I have addressed that issue in this decision and reject an order for security for costs.

Disposition

[40] At this time, I will not strike the respondent’s pleadings but will adjourn the applicant’s motion to strike to a date before me after January 31, 2018 to allow the respondent time to pay the costs award. The parties are to contact the trial coordinator’s office to schedule that date before me to address the respondent’s compliance with this order. If the order is not complied with, I intend to strike the respondent’s pleadings.

[41] I order that this case is to be removed from the January 2018 trial sittings and placed on the May 2018 trial sittings pending further order.

[42] I order that paragraphs 14 and exhibit E, paragraph 45 and paragraph 47 (sentence three) be struck from the respondent’s affidavit dated December 7, 2017.

Costs

[43] The applicant was a successful party on this motion and is entitled to costs. I request the parties to attempt to resolve the issue of costs. If they are unable to do so, I order that the applicant shall provide her costs submissions not to exceed three pages plus a detailed bill of costs and any offers to settle to be provided by January 5, 2018. The respondent is to provide his costs submissions by January 12, 2018 with said submissions not to exceed three pages plus a detailed bill of costs and any offers to settle.

Shelston J.

Released: December 19, 2017

CITATION: Clark v. Moxley, 2017 ONSC 7610

COURT FILE NO.: FC-15-1451

DATE: 2017/12/19

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Heather Clark

Applicant

– and –

Neil Moxley

Respondent

ENDORSEMENT

Shelston J.

Released: December 19, 2017