COURT FILE NO.: CV-10-100725 DATE: 20190329 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Prime Investment Corporation Ltd. Plaintiff – and – Frank Fiorini, Michael Fiorini, Newlin Holdings Limited, The Fiorini Family Trust, The Newlin Trust and 2164287 Ontario Limited Defendants

Counsel: Rolf M. Piehler, for the Plaintiff David J.H. Jackson, for the Defendants

HEARD: February 14, 2019

Reasons for Decision

MCKELVEY J.:

Introduction

[1] In a Notice of Motion dated December 8, 2010, the plaintiff initiated a motion for contempt against the defendant, Frank Fiorini. This motion was adjourned on a number of occasions and was finally struck from the list on May 11, 2011. By way of a Notice of Return of Motion dated May 1, 2018, the plaintiff brought its original contempt motion back for consideration. This motion was heard on February 14, 2019. For the reasons which follow, the plaintiff’s motion is dismissed.

Relevant Background

[2] The plaintiff’s action involves a claim for damages arising from an alleged breach of an equipment lease for construction equipment. The Statement of Claim was issued on September 2, 2010. The orders which are in issue on this motion are dated October 19 and November 10, 2010, both of which were issued by Justice Edwards. Both of these orders relate to the construction equipment which is involved in the main action. Justice Edwards’ Order dated October 19, 2010 appears to be a temporary order which provides as follows,

Motion adjourned to November 2, 2010. Any further material to be served by October 25, 2010. Mr. Frank Fiorini to disclose the exact municipal address for the equipment located on Brock Road in Pickering and Aurora Sideroad in Schomberg to counsel for the plaintiff by October 20, 2010.

The Defendants shall not move any of the equipment listed in Schedule A without the express written consent of counsel for the Plaintiffs of until further order of this court.

[3] The Order of Justice Edwards dated November 10, 2010 was an order for interim possession of the equipment and stated,

1. THIS COURT ORDERS that the Defendants deliver possession of the equipment described in Schedule “A” hereto (the “Equipment”) to the Plaintiff;
2. THIS COURT ORDERS that the Sheriff of whichever County or Municipality in Ontario in which may be found, attend with a representative of the Plaintiff upon the Defendants to seize or otherwise obtain possession of the Equipment and deliver same to the Plaintiff’s possession;
3. THIS COURT ORDERS that the Defendants immediately disclose the location of the Equipment to the Plaintiff;
4. THIS COURT ORDERS that the Sheriff be and is hereby granted leave to gain access to the lands, premises, garages and sheds, if necessary, at 12201 Keele Street, in the City of Vaughan, with the assistance of a licensed locksmith, if necessary, for the purposes of seizing the Equipment;
5. THIS COURT ORDERS that the Plaintiff is approved by the Court as a party entitled to give a Bond as security pursuant to Rule 44.04(3) and that the Sheriff as described in paragraph 2 hereof is to accept the Bond upon execution of same by the Plaintiff, as sufficient security to execute service of this Order;
6. THIS COURT ORDERS that the amount of the Bond posted by the Plaintiff shall be in the amount of $200,000.00 which sum shall be sufficient security pursuant to Rule 44.04(1)(a);
7. THIS COURT ORDERS that this Order is enforceable against any other person or persons who may be in possession of the vehicle subject to their rights pursuant to the Personal Property Security Act, R.S.O. 1990, and other applicable statutes;
8. THIS COURT ORDERS that the costs of this Motion be payable to the Plaintiff fixed at $1500.00;

[4] The relief sought in both the original motion and the most recent Notice of Return of Motion appears to be identical. The relief claimed in the Notice of Return of Motion reads as follows:

1. A Declaration that the Defendant Frank Fiorini is in contempt of the Orders of the Honourable Mr. Justice Edwards dated October 19 and November 10, 2010;
2. A warrant for the arrest of Mr. Frank Fiorini pursuant to Rule 60.11(4) of the Rules of Civil Procedure, if necessary;
3. An Order that Frank Fiorini be denied leave to bring any proceedings against the Plaintiff until he purges his contempt;
4. In the alternative, an Order that the Defendant Frank Fiorini comply with the Order of the Honourable Mr. Justice Edwards dated October 19th, 2010 within 30 days of being served with a copy of the Order herein, failing which the Plaintiff may move, without notice, for an Order that a warrant for the arrest of Frank Fiorini be issued under Rule 60.11(4) and an Order that Frank Fiorini be held in custody until he purges his contempt pursuant to Rule 60.11(5)(b);
5. An Order granting costs of this Motion to the Plaintiff on a substantial indemnity basis;
6. Such further and other relief as this Honourable Court deems just.

[5] The law with respect to civil contempt is set out in the Supreme Court of Canada decision in Carey v. Laiken, 2015 SCC 17, [2015] 2 S.C.R. 79. In that decision, the Supreme Court sets out the criteria which must be satisfied to justify a consent order. These criteria require the moving party to prove beyond a reasonable doubt the following:

1. The order which has been breached must state clearly and unequivocally what must be done or not done by the party against whom the contempt order is sought;
2. The party alleged to have breached the order must have had actual notice of the order; and
3. The party alleged to have breached the order must have acted intentionally.

[6] The court’s contempt power is discretionary and courts have discouraged its routine use to obtain compliance. In the Carey decision, the Supreme Court notes that the contempt power is an enforcement power of last rather than first resort.

Analysis

[7] I concluded that this motion must be dismissed for the following reasons:

Delay in Bringing Motion Back to Court

[8] The plaintiff has delayed for over seven years following the original return date of January 13, 2011. In St-Amour c. Major, 2017 QCCS 2352, which is a Quebec Superior Court decision, the court concluded that civil contempt motions were quasi-criminal in nature and that the R. v. Jordan decision of the Supreme Court of Canada, applied so that such a motion must be disposed of within 30 months. Clearly, that timeframe was not met in this case.

[9] There may well be an issue as to whether the St-Amour decision from Quebec is applicable in Ontario or indeed whether it was correctly decided. However, the delay which has occurred in this case is over seven years.

[10] In its decision in Carey, the Supreme Court of Canada states that the judge entertaining a contempt motion generally retains some discretion to decline making a finding of contempt. At para. 37 the court states,

While I prefer not to delineate the full scope of this discretion, given that the issue was not argued before us, I wish to leave open the possibility that a judge may properly exercise his or her discretion to decline to impose a contempt finding where it would work an injustice in the circumstances of the case.

[11] In my view, it is not in the interests of justice to allow a litigant to wait for over seven years before deciding to proceed with a motion for contempt. The plaintiff in this case felt it had a sufficient basis to bring the motion in 2010. To allow this litigant to wait until 2018 to pursue a contempt order would in my view work a real injustice to the defendant as there is the potential for significant prejudice. The delay risks that relevant evidence will be lost and over a period of seven years it is reasonable to believe that the memories of the parties on the issues involved on the motion will have faded. Finally, a delay of over seven years will most likely involve many changed circumstances which make a contempt order inappropriate.

Abandoning Contempt Allegations in April 2011

[12] The injustice in this case is compounded by the fact that the plaintiff clearly indicated to the defendant and the court in April of 2011 that it would not be proceeding with the motion. The motion was originally returnable on January 13, 2011. After three adjournments it was spoken to in court on April 13, 2011. The endorsement for that date reads as follows:

Mr. Piehler advises that the equipment has been located and contempt has been purged. Mr. Fiorini, however, wishes his matters as brought before Justice Mullins on March 22, 2011 be brought forward on notice to plaintiff. Matter adjourned on consent to May 11, 2011 at 9:30 a.m. to allow Mr. Fiorini to file and serve materials returnable that day. [Emphasis added]

[13] On the next scheduled attendance on May 11, 2011, where Mr. Fiorini’s matters were to be dealt with, no one appeared and the matter was struck from the list. No further steps appear to have been taken from that point until the Notice of Return of Motion dated May 1, 2018 was served.

[14] It is reasonable to infer from the endorsement of April 13, 2011 and the note that Mr. Fiorini’s contempt “has been purged” that the contempt motion was being withdrawn. Mr. Fiorini, who was present in person on April 13, 2011, would reasonably conclude that the contempt motion was at an end. To allow the contempt motion to be resurrected without compelling new evidence of a contempt having occurred subsequent to April 13, 2011, would in my view lead to an injustice to Mr. Fiorini.

Request to Enforce Order to Deliver Possession of Equipment

[15] During the argument before me, Mr. Piehler on behalf of the plaintiff appeared to suggest that he was withdrawing the contempt motion but was asking this court to enforce the order of Justice Edwards to require the plaintiff to deliver possession of the equipment in question in accordance with paragraph 1 of the Order of Justice Edwards dated November 10, 2010. The difficulty with this argument is that pursuant to Rule 60.11, a finding of contempt is a precondition for making such an order. Mr. Piehler argued that the court still has an inherent jurisdiction to make such an order. However, Rule 60.11 is the only stated ground on which this motion was brought. Given that the plaintiff has not pleaded any alternate ground in its Notice of Return of Motion and has not submitted any authorities to support its position, I conclude that in the context of this motion there is no basis to consider the alternative argument which the defendant has not had an opportunity to respond to.

[16] Further, it is significant in my view that the plaintiff has not established any basis to believe that the defendant, Frank Fiorini, is currently in the possession of any property which was the subject of Justice Edwards’ Order.

Failure to Prove Breach Beyond a Reasonable Doubt

[17] The evidence before me does not establish beyond a reasonable doubt that Mr. Fiorini has intentionally breached the orders of Justice Edwards. The plaintiff initially relied on an Affidavit of Catherine Virgo. At paragraph 5 of this affidavit Ms. Virgo states,

I am advised by John Jalovec, the Plaintiff’s Ontario representative, and do verily believe that he has had several discussions with Mr. Fiorini since October 19th, 2010 and in each discussion, Mr. Fiorini failed or refused to disclose the exact municipal address for the missing equipment.

[18] In an Affidavit dated December 24, 2018, however, Mr. Fiorini asserts at paragraph 24 that he advised Mr. Piehler with respect to the location of the equipment at one of his attendances at the Newmarket Courthouse.

[19] In an Affidavit dated December 13, 2018, Mr. John Jalovec, the representative of the plaintiff indicates at paragraph 9 that he was advised about the potential location of the equipment at an address in Uxbridge. He attended at the site and located some high value items, but when he subsequently returned for more equipment he alleges that all of the remaining equipment had been removed. In an Affidavit sworn by Mr. Fiorini dated September 24, 2018, he denies moving any of the equipment from any of the locations where it was located on October 19, 2010, and he further denies that he sold any of the equipment to any third parties.

[20] It is apparent based on the affidavit evidence before me that there is conflicting evidence on the material issues and the plaintiff has failed to prove beyond a reasonable doubt the facts on which the alleged breach occurred.

Request for a Hearing

[21] The plaintiff argues that even if the evidence is conflicting as to whether the defendant breached the order of Justice Edwards, the court should remedy this by ordering a hearing to determine the issue. I disagree. The plaintiff had a full opportunity to cross-examine Mr. Fiorini on his Affidavit and to present further evidence. Having failed to do so I conclude that the plaintiff has failed to meet its onus of establishing an intentional breach of the court order beyond a reasonable doubt.

[22] During argument the plaintiff attempted to explain the delay for bringing this motion back because it was hoping to effect a recovery on the judgment against the defendant. However, when it became apparent that any liability of the defendant was extinguished following his discharge from bankruptcy, the plaintiff elected to proceed with the contempt motion as a means of trying to effect some recovery from the defendant. This position is referenced in paragraph 15 of Mr. Jalovec’s Affidavit where he states,

It should also be noted that Prime was granted security and personal guarantees which were the subject of the other action and that no recovery was made in that action and that Judgment remains unsatisfied. The security granted by Mr. and Mrs. Fiorini in that action was real property security on their matrimonial home, which was ultimately foreclosed by the first mortgagee and then transferred back to Mr. Fiorini’s daughter and I do verily believe that Mr. and Mrs. Fiorini continue to reside at that property at 12 Keremeos Crescent, in the Town of Richmond Hill.

Conclusion

[23] A contempt motion, as noted by the Supreme Court in its decision in Carey at para. 36, should not be reduced to a mere means of enforcing judgments. In my view, this is what the plaintiff is attempting to do in this contempt motion. It essentially is acting as a backup plan when the plaintiff was unable to enforce its judgment against the defendant because of his bankruptcy. Because of the seriousness and quasi-criminal nature of civil contempt it should be used cautiously and with great restraint. A court should avoid granting relief on a contempt motion simply because other means of enforcement have failed.

[24] For the above reasons, the plaintiff’s contempt motion is dismissed. Costs will be addressed by me on this motion separately.

Justice M. McKelvey Released: March 29, 2019