Court File and Parties
COURT FILE NO.: FS 12,769/14
DATE: 20180515
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Carol Bernadette Brunet, Applicant
AND:
Victor Ovila Brunet, Respondent
BEFORE: The Hon. Mr. Justice Robert G.S. Del Frate
COUNSEL: Richard Pharand, counsel, for the Applicant
Matti Mottonen, counsel, for the Respondent
HEARD: April 25, 2018
DECISION on motion
Background
[1] Although there were cross-motions brought by the parties, only the respondent’s motion was heard at this hearing. However the affidavit of the applicant for her motion was referred to.
[2] The respondent brings this motion to dismiss the applicant’s application. He also seeks a divorce order and a request that the applicant transfer her undivided one-half interest in the matrimonial home, or alternatively, a vesting order. The applicant in her motion seeks to set aside the final order granted by Justice Gordon on October 23rd, 2014. Further, she seeks spousal support, equalization of the net family properties, exclusive possession of the matrimonial home, and a sale of the family property.
[3] The uncontested facts seem to be the following.
Facts
[4] The respondent is a Mechanics Teacher at Cambrian College earning $96,209.04 per year. He is currently 64 years old.
[5] The applicant has not worked for over two decades due to fibromyalgia, and she receives $23,942.83 from Canada Pension Plan benefits, Retirement Income Fund payments, and RRSP income. She is 58 years old.
[6] The parties married on August 21st, 1976 and separated on February 1st, 2014.
[7] The parties attended mediation in April 2014, but no agreement was reached.
[8] The applicant subsequently retained counsel, Mr. Dale Brawn, to pursue equalization of the respondent’s pension. An application was commenced on October 21st, 2014, which was issued on October 23rd, 2014. The applicant requested only an equalization of the net family property.
[9] The respondent was served by mail on October 24th, 2014, and he was given the application and a letter from Mr. Brawn, dated October 23rd, 2014, which stated: “Your wife asked me to inform you that she is not asking for spousal support or a sale of the matrimonial home, or a sale of any of your assets. She is seeking only a division of your pension.”
[10] The parties subsequently obtained a consent order dated February 6th, 2015, that transferred one-half of the respondent’s pension to the applicant (amounting to a payment of $354,247.04).
[11] Subsequently, Mr. Brawn (allegedly without prior notice or consent of the applicant) amended the application pursuant to Rule 11(1) of the Family Law Rules, O. Reg. 114/99. The amendments were made on March 5, 2015, adding a claim for spousal support but not for possession, sale, or occupation rent related to the matrimonial home.
[12] The respondent was served in March 2015, and he met with Mr. Brawn, who confirmed that he was proceeding with the amended application. The respondent, who was self-represented up until May 2015, filed an Answer, Financial Statement, and Certificate of Financial Disclosure on May 21st, 2015.
[13] Mr. Brawn is no longer representing the applicant, and an action has been brought against him by the applicant.
Issues
[14] The respondent identified a number of issues, which I have broken down into three main issue:
Did the parties reach an agreement to divide the pension in exchange for the applicant releasing all other claims?
Can the applicant continue with her motion dated November 28th, 2017?
Is the respondent entitled to a divorce order?
Position of the Parties
Respondent
[15] The respondent argues that the letter from Mr. Brawn amounted to a settlement offer, which the respondent accepted. The parties agreed that the respondent would retain exclusive possession and sole ownership of the matrimonial home and be responsible for the joint debt as of the date of separation. In exchange, the applicant was to receive half of the respondent’s pension, her spousal RRSP, the 2007 Jeep Grand Cherokee, and any items she wanted from the matrimonial home.
[16] The respondent argues that the applicant is bound by the agreement made by Mr. Brawn as there was no limitation on his ostensible authority to bind his client, and the applicant signed the consent that resulted in the final order of February 6th, 2015 that terminated the action. Moreover, section 56(4) of the Family Law Act, R.S.O. 1990, c. F.3, is inapplicable as it only governs domestic contracts.
[17] Furthermore, the amendment of the application was improper, and the court therefore lacks jurisdiction to grant support, sale of the matrimonial home, or occupation rent. In any event, these claims would all fail on their merits.
[18] Based on the period of living separate and apart, the parties are entitled to a divorce order.
Applicant
[19] The applicant claims the mediator told her she was entitled to part of the respondent’s pension and could get that income to help pursue her other claims. Her instructions to counsel were, she claims, to sever the husband’s pension.
[20] The consent order of February 6th, 2015 dealt only with the pension, but the application was for equalization of “net family properties”. Marking the order as final was a mistake—the order should have been marked as a temporary order. The respondent knew that the applicant was entitled to more than half of his pension, the mediator advised him as much.
[21] The respondent did not attack the issuance of the amended application when he was served in March 2015, and he instead waited 30 months before moving to dismiss the application. He was aware of the irregularity of amending the application when he filed his answer and other documents. Rule 2.02(b) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, requires leave to attack a step if the moving party has taken a fresh step. The respondent filed an answer, which is a fresh step precluding an attack on the amended application without leave.
[22] Moreover, the respondent cannot bring this motion as he has never pleaded the relief he seeks in his Notice of Motion, and he therefore needs to seek leave.
[23] Finally, the court can set aside the consent order per s. 56(4) of the Family Law Act on the basis of unconscionability. Furthermore, under the Rules of Civil Procedure, r. 59.06(2)(a),(d), an order can be set aside when it is necessary in the interest of justice. The applicant only learned of the alleged settlement after the fact, and this justifies setting aside the consent order.
Analysis
1. Did the parties reach an agreement to divide the pension in exchange for the applicant releasing all other claims?
[24] It is well established that actions taken by counsel on behalf of their clients in the ordinary course of practice bind their clients, unless the other party is aware of limitations on counsel’s ostensible authority: Scherer v. Paletta, 1966 CanLII 286 (ON CA), [1966] 2 O.R. 524 at 527 (C.A.). Nonetheless, there was no agreement between the parties to release all claims against the respondent in exchange for half of the respondent’s pension. Even if there was an agreement, it should be set aside.
[25] First, the parties were not ad idem. The respondent believed that the pension transfer satisfied all claims, but the applicant believed that only the pension was being finally disposed of. There was therefore no agreement besides what the parties agreed to in their consent order.
[26] Second, releases must be in a domestic contract, see Miller v. Miller (1982), 1982 CanLII 68 (ON CA), 39 O.R. (2d) 74 (C.A.), at para. 15:
Having so carefully provided for the disposition by domestic contract of the new and important rights conferred on spouses by the Act, the legislature could never have intended that these rights could be freely disposed of by other forms of agreement such as simple releases.
[27] There also needs to be “specific language” to find a release, and courts are loathe to find one where the contract is silent and the agreement “could easily and simply have provided for this”: Condoyannis v. Foundos, 2010 ONCA 279, at para. 17.
[28] None of the requirements appear to have been met—no agreement was put into writing, nothing was witnessed, and it is not clear each party received independent legal advice. Instead, there is a record of conflicting evidence. The consent order only relates to the pension, and there is no evidence the applicant intended to release other claims. If the parties were of the view the pension settled all other claims, they easily could have provided for this.
[29] Third, there appears to have been a mistake in Mr. Brawn’s understanding of the applicant’s instructions, and any agreement should be set aside based on the substantial prejudice to the applicant.
[30] In Milios v. Zagas, 1998 CanLII 7119 (Ont. C.A.), the Ontario Court of Appeal overturned an order granting judgment in accordance with an offer to settle. The solicitor agreed to terms of settlement based on a mistaken belief of his client’s instructions. Based on the evidence and substantial prejudice that would arise from accepting the applicant had waived all other rights, the agreement was not enforced.
[31] In Bogue v. Bogue, 1999 CanLII 3284 (Ont. C.A.), counsel for one party included a standard release clause in the separation agreement, not the specific release requested by the client. The Court of Appeal found that the prejudice caused to the other party would not favour setting the agreement aside.
[32] In Wilde v. Wilde, [2000] O.J. No. 2395 (S.C.), the court set aside minutes of settlement, concluding there was a unilateral mistake. The respondent wife argued that it was the common intention of the parties to deal with the applicant’s pension, but it was left out of the minutes. She further claimed that she did not instruct counsel to give up her share of the pension. Justice Linhares de Sousa found that the wife would not have knowingly agreed not to share in her husband’s pension.
[33] In the present case, the applicant did not intend to waive her rights to support, the matrimonial home, and other property. The prejudice to her would be substantial if a release is found and enforced. Conversely, the prejudice to the respondent is minimal. The respondent claims he agreed to the consent order giving away half his pension on the understanding it would settle all other claims. However, due to the nature and duration of the relationship, the pension would most likely have been divided in this way in any event.
[34] The respondent submits that the final order of Gordon J. dated February 6, 2015 ends all of these proceedings, and any subsequent proceedings instituted by either party would be null ab initio.
[35] I do not accept that proposition. The order is in total compliance with the consent that was executed and filed by the parties. It deals with only one issue:
The CAAT pension of the respondent, Victor Ovila Brunet, be divided equally between the Applicant, Carol Bernadette Brunet, and the respondent, at source, effective 1 February, 2014.
[36] The order of Gordon J. accurately reflects that consent.
[37] The respondent admits that the issues are finalized by the letter forwarded by counsel on October 24, 2014 stating the following:
Your wife asked me to inform you that she is not asking for spousal support or a sale of the matrimonial home, or a sale of any of your assets. She is seeking only a division of your pension.
[38] Although that may have been the respondent’s understanding, that she was relinquishing her rights to those claims, that is not what the consent stated. If a court were to include other terms and conditions which were not part of the consent, havoc would result. In settlement negotiations, there are numerous offers that are exchanged between the parties. Were the parties permitted to rely on all of these exchanges there would be no ending to litigation. Accordingly parties have to be specific as to what they are agreeing to and those agreements ought to be included in the consent or the Minutes of Settlement which would be incorporated in the order.
[39] Finally, any agreement would be unenforceable on the basis of unconscionability. This doctrine was outlined in Rick v. Brandsema, 2009 SCC 10, [2009] 1 S.C.R. 295; Rosen v. Rosen, 1994 CanLII 2769 (Ont. C.A.). As stated in Leopold v. Leopold, 2000 CanLII 22708 (S.C.), at para. 144, “an unconscionable agreement is one that is clearly outside the range of what is objectively fair when it was made, taking into account the facts and circumstances of the parties”.
[40] The applicant is a 58 year old woman of limited means who spent most of her life in a traditional marriage. In the circumstances, it would not be objectively fair to enforce an agreement in which she receives no support from a spouse with substantially greater means and has no right to significant assets like the matrimonial home and rental property.
[41] In sum, there is no agreement beyond the terms of the consent order, and there is nothing in the consent order that suggests the applicant has waived any rights.
2. Can the applicant continue with her Motion dated November 28th, 2017?
[42] Consent orders are final and binding, subject to amendment only where they do not express the intentions of the parties or fraud can be demonstrated: see McCowan v. McCowan, 1995 CanLII 1085 (Ont. C.A.). The motion judge’s decision to make this a final order rather than a temporary one is therefore correct.
[43] A final order does not necessarily end an application, and this consent order only indicates that the parties meant to settle the pension.
[44] New claims can be added to an application if the amending party complies with rule 11(1) of the Family Law Rules. Mr. Brawn did not comply with that rule. Nonetheless, the amendments should be allowed.
[45] Rule 2 provides courts with flexibility to deal with cases in a just manner, and sub-rule 11(3) requires courts to allow an amendment absent prejudice or disadvantage that cannot be cured by costs, an adjournment, or both. In Stefureak v. Chambers, 2005 CanLII 16090 (Ont. S.C.J.), Justice Quinn outlined the following principles:
• It matters not whether the amendment is prompted by a change in the case or is merely an afterthought
• The mere fact that the request for an amendment comes as a surprise to the other side is unimportant, as the surprise will not amount to a disadvantage unless it cannot be offset by an award of costs or the granting of an adjournment or both
• It is irrelevant that the proposed amendment raises a new issue
• Unfairness is only material where it cannot be cured by costs or an adjournment or both
• The existence of bad faith is an exception to everything
[46] The mediator allegedly told the applicant, and supposedly the respondent, that she could sever the pension to get money while she advanced her other claims. Her counsel then commenced an application to deal with the pension, and the application was amended very shortly after the consent order was granted.
[47] Based on the lack of an agreement to waive other rights, there is no prejudice in allowing the applicant to pursue her property and support claims. Considering the personal circumstances of the applicant who was simply following (questionable) advice on the procedure to follow to pursue her matrimonial rights, not allowing the amendments would produce substantial prejudice and unfairness. Any prejudice to the respondent would be significantly less because, as outlined above, he most likely would have been required to split the pension even if the consent order was not made.
3. Is the Respondent entitled to a Divorce Order?
[48] A divorce order may be granted on a motion for summary judgment "in a proper case": Heon v. Heon, 1988 CanLII 4824 (Ont. C.A.); see also Menzinger v. Menzinger, 1998 CanLII 14849 (Ont. Gen. Div).
[49] The parties have been separated for more than a year, and the applicant has not resisted the requested divorce order. Moreover, there is no evidence that the applicant would be prejudiced by the granting of the divorce order. Accordingly, the divorce is granted.
Conclusion
[50] The respondent’s motion with respect to dismissing the applicant’s motion should be dismissed. However, a divorce order is appropriate. The applicant may continue with her claims.
[51] Should the parties not agree on the matter of costs, then I would entertain written submissions not to exceed five pages with the appropriate time dockets attached and the hourly rates claimed.
[52] Order to issue as per decision.
The Honourable Mr. Justice Robert G.S. Del Frate
Date: May 15, 2018