BARRIE COURT FILE NO.: FC-17-856-01 DATE: 20190409

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Scott Michael Ainger, Applicant AND: Karen Leigh Posendorf, Respondent

BEFORE: The Honourable Mr. Justice J.P.L. McDermot

COUNSEL: S. Nadine Finbow, for the Applicant Jason J. Murphy, for the Respondent

HEARD: February 28, 2019

ENDORSEMENT

BACKGROUND

[1] Scott Ainger, the Applicant in this case, seeks spousal support from his wife, Karen Posendorf. In this motion, he asks for security for that spousal support claim. She has sold a rental property and he wishes $175,000 from the net proceeds to be paid into trust to secure his spousal support claim.

[2] Mr. Ainger can claim little more than spousal support in this application as their child is grown, and Mr. Ainger has made an assignment into bankruptcy on June 2, 2014, his third. He remains undischarged. As his assets are vested in the trustee in bankruptcy, including any right to equalization or to the property of the Respondent, Mr. Ainger has no property claims in this litigation.

[3] These parties were originally married in 1990 and separated for the first time in 1995. They reconciled in 1997, married again in 2012 and finally separated in May, 2017. They have one child, Tyler James Ainger (“TJ”) who is an adult and independent. Mr. Ainger also has two children from a former marriage, Michael and Michelle.

[4] Unique in this claim for security for a spousal support claim, Mr. Ainger has not had his claim for spousal support tested by a court, even on a temporary basis. Mr. Ainger bases his claim on income to be imputed to Ms . Posendorf as he says that she can work for Ainger Group which is a successor to the business known as Ainger Enterprises, a company that he founded. He says that she worked for this company until separation, left without good reason and she is now voluntarily underemployed. Mr. Ainger says that he is unable to work because of illness and filed a letter from his doctor, Dr. Harlos who says that Mr. Ainger is “unable to work at this time due to poor concentration, memory, interest and increasing fatigue, feeling of hopelessness and insomnia.” [1]

[5] Ms . Posendorf also seeks spousal support. She says that Mr. Ainger is actually working for Ainger Group and makes a substantial income in excess of $90,000 per annum; it is she who is unable to work and who is entitled to spousal support. She says she was injured in a motor vehicle accident in 2012 and has not been able to work in any meaningful capacity since then. She says that she would have had a substantial award in motor vehicle litigation arising from that accident but Mr. Ainger and his daughter, Michelle, deliberately sabotaged that claim, reducing her settlement from $280,000 to $35,000. [2]

[6] This motion is, however, only about securing Mr. Ainger’s potential claim for spousal support. Ms . Posendorf has sold a rental property located at 138 Peel Street in Collingwood; she would have normally been entitled to receive all of the net proceeds from the sale of that home. Mr. Ainger says that to release the funds to her would jeopardize his spousal support claim. He wants $175,000 from the sale of the property to be set aside and held as security for that claim. He points out that Ms. Posendorf has no income (and according to him, she should be working); there is otherwise nothing to collect spousal support from if this money is not set aside. He seeks an order for security for the spousal support claim in the amount of $175,000. The sale of the home has now closed and, since bringing the motion, an interim order has been made for $160,000 to be held in trust pending disposition of this motion.

Result

[7] For the reasons set out below, the Applicant’s motion is dismissed with costs. All funds held in trust may be released to the Respondent.

Positions of the Parties

[8] Both parties have filed extensive and lengthy affidavits. Ms . Posendorf’s affidavit is replete with emails that she gathered from the server of Ainger Group in order to prove that Mr. Ainger continues to work there, more or less, full time. Mr. Ainger objects to that evidence being used, as well as to the fact that Ms. Posendorf filed a “reply affidavit to a reply affidavit” something which is usually not permitted under r. 14(20) of the Family Law Rules [3] as Ms. Posendorf has not filed a counter-motion. On the other hand, Ms. Posendorf says that Mr. Ainger has perjured himself and that he deserves no relief from this court.

[9] Apart from the evidentiary issues, Mr. Ainger says that he is entitled to security for his spousal support claim. He says that, because Ms . Posendorf is voluntarily underemployed and has no income, she has no means to pay his spousal support claim.

[10] Ms . Posendorf acknowledges that she has no means to pay a spousal support claim as she is only working as an Uber driver at present; however, she says that Mr. Ainger’s claim is without merit, as he is presently working for Ainger Group. She says that his evidence that he is not working is not credible in any way considering the emails showing him to be an employee of Ainger Group and also considering emails showing that he receives a compensation package. She posits that if anyone is on the hook to pay spousal support, it is Mr. Ainger, based upon his actions in her civil lawsuit and based upon his income at present.

[11] Even if Mr. Ainger’s evidence is credible, Ms . Posendorf notes that she still owns an interest in the matrimonial home which is worth at least $150,000, which should suffice as security for any spousal support claim that Mr. Ainger may have.

ANALYSIS

[12] The issues in this matter can be summarized as follows:

(a) Evidentiary Issues: These issues comprise both the issue of admissibility of Ms . Posendorf’s evidence, and the perjury issues raised by her.

(b) Is there a necessity for a prima facie case for spousal support on the part of Mr. Ainger prior to granting security for that claim and, if so, has that case been made?

(c) Is there any merit to an award of security for Mr. Ainger’s claim for security apart from his reasonable expectation of success at trial?

Evidentiary Issues

[13] There were a number of issues concerning the evidence raised by Applicant’s counsel. These included the issues of the “reply to the reply affidavit” filed by the Respondent, as well as the issues surrounding hearsay evidence as contained in the exhibits to the Respondent’s affidavit, sworn February 1, 2019, and the issue of authentication of the emails as required by s. 34.1 of the Evidence Act . [4] On the other hand, the Respondent has requested dismissal of the motion based upon the fact that the Applicant and his daughter, Michelle Ainger, have perjured themselves in their affidavits.

[14] Therefore, the evidentiary issues are as follows:

(a) The filing and use of the Respondent’s “reply to a reply” affidavit filed contrary to r. 14(20) of the Rules ;

(b) Whether the emails attached to the Respondent’s affidavit are inadmissible as hearsay evidence or an invasion of privacy;

(c) Whether the emails attached to the Respondent’s affidavit have been properly authenticated as required by s. 34.1 of the Evidence Act ;

(d) Whether the Applicant and his daughter have perjured themselves in their evidence about the Applicant not working, and whether this should result in a dismissal of the Applicant’s motion on its own.

The Respondent’s “reply to the reply” affidavit, sworn February 6, 2019

[15] There is only one motion filed in this matter. That motion was Mr. Ainger’s motion for security for the spousal support. No counter-motion was filed.

[16] Under r. 14(20), and subject to the court ordering otherwise, evidence filed on a motion are subject to the following restrictions:

1. The party making the motion shall serve all the evidence in support of the motion with the notice of motion.
2. The party responding to the motion shall then serve all the evidence in response.
3. The party making the motion may then serve evidence replying to any new matters raised by the evidence served by the party responding to the motion.
4. No other evidence may be used.

[17] Ms . Posendorf filed an extensive and lengthy affidavit in response to the Applicant’s motion. [5] That affidavit had 33 Exhibits attached, many of which were emails obtained by Ms. Posendorf which proved that the Applicant continued to work for and remain involved in Ainger Group notwithstanding his assertion that he had “completely” stopped working in July, 2017, and had “no income” since that date.

[18] As he was entitled to do, Mr. Ainger filed a reply affidavit which was sworn on February 4, 2019. [6] He complained of the length of the Respondent’s affidavit and that Ms . Posendorf was attempting to have the motion delayed as a long motion. He also complained of the emails, stating that they were “double hearsay” and that they had not been “authenticated”. He complained about the way the Respondent obtained the emails, stating that they were “improperly obtained” and that they were “akin to the tort of intrusion upon seclusion.” [7] On the basis of his position that the email evidence filed by the Respondent is inadmissible, he does not comment on the emails themselves or deny that they were authentic or what they purported to be; it is his position that he does not have to. [8]

[19] Ms . Posendorf then proceeded to file another affidavit sworn February 6, 2019 [9] which was a “reply to the reply”, something that r. 14(20) says that you cannot do without leave of the court. In that affidavit, Ms. Posendorf addresses how she obtained the emails, stating that she got the password from TJ and downloaded the emails at the library. She states that “there is nothing ‘inauthentic’ about the Ainger Group emails attached to my affidavit.” [10]

[20] The issues concerning the authenticity of the emails and their admissibility had to be addressed in some way prior to argument of the motion. Perhaps this information should have been contained in her original affidavit; however, had Ms . Posendorf not addressed the issue in her second affidavit, she would have been entitled to argue admissibility of the evidence by way of a voir dire at the motion, and at that point in time, the parties could have testified both as to how the emails were obtained, their authenticity, and as to the reliability and necessity of any hearsay that was challenged by Mr. Ainger. The fact that he challenged the evidence meant that, at some point, Ms. Posendorf would have had to provide a foundation for that evidence for the argument as to admissibility. The fact that she decided to lay that foundation by way of an affidavit rather than by testimony at a voir dire is not to be criticized.

[21] The remainder of Ms . Posendorf’s second affidavit essentially contains argument of the issue, rather than evidence, and does not provide additional information to the court. For example, the summary of Ms. Posendorf’s historical income contained in para. 18 of that affidavit can be obtained directly from exhibits to her affidavit sworn on February 1, 2019 [11] which contained disclosure that she was to provide pursuant to Minutes of Settlement signed on January 23, 2019. The Spousal Support Advisory Guideline ( SSAG ) calculations attached to that affidavit are just that, calculations and not evidence, and could have as easily been handed up during argument of the motion; in any event they only respond to SSAG calculations attached to the Applicant’s reply affidavit.

[22] Other than addressing the evidentiary issues raised by the Applicant, the Respondent’s second affidavit is therefore not, strictly speaking, a “reply to a reply.” It is, essentially, argument and does not provide much in the way of new evidence contrary to r. 14(20).

[23] The Respondent’s second affidavit found at Tab 21 of Volume 4 of the Continuing Record is therefore admitted into evidence.

Hearsay Evidence

[24] In his reply affidavit, and in his factum, the Applicant complains about the “144 pages of emails” attached to the Respondent’s Reply Affidavit. He says that these emails constitute hearsay evidence and should be ruled as being inadmissible.

[25] The emails are extremely damaging to the Applicant’s case for spousal support. The Applicant says that he has been unable to work since July, 2017 for medical reasons. He deposed that he has had “stopped working” at that time and had been unable “to return since that date” on his doctor’s advice. [12] Later in the affidavit, he said that he had to “ completely stop working” for Ainger Group because of his health issues, and he claims spousal support as a result (emphasis mine). [13]

[26] The emails make it apparent that this is not the case. The emails show that Mr. Ainger continued to work with the Ainger Group after July, 2017, providing property management services, bidding on jobs and purchasing for the company. They also show that a compensation package was put together for Mr. Ainger consisting of a loan and benefits that Ms . Posendorf says totals between $94,000 and $106,000 per annum.

[27] Hearsay evidence can be defined as an out of court statement by a third party which is proffered to prove the contents of that statement. [14] However, a third party statement that is offered “is not hearsay and is admissible when it is proposed to establish by the evidence, not the truth of the statement but the fact that it was made”: see R. v. O’Brien, [1978] 1 S.C.R. 591 at para. 4.

[28] Under this definition, many of the emails attached to the Respondent’s Reply Affidavit are not hearsay, but are offered as circumstantial evidence that Mr. Ainger was working at the Ainger Group. They are mostly emails to and from Mr. Ainger which were sent in the ordinary course of business. These would include all of the emails attached as Exhibits C to S inclusive attached to that affidavit. They show Mr. Ainger to have been continually involved in quoting on jobs, property management, purchasing equipment and supplies and in making decisions involving the company.

[29] All of these emails were offered, not as to the proof of their contents, but as circumstantial evidence that Mr. Ainger was involved in the management and operations of the company on a day to day basis well after he claimed that he was “completely not working” as noted above. For example, the email at Ex. C, which was an email from a client of the company, Dr. LaFlamme, dated January 10, 2019, is not entered as to the truth of its contents (that Dr. LaFlamme’s office was leaking) but to prove that it was Mr. Ainger that he contacted to address the problem, and that Mr. Ainger responded to say that he would be going to the premises that afternoon, and would report back to the tenant. That is circumstantial evidence intended to prove that Mr. Ainger was working for the company on January 10, 2019 and was not, in fact, disabled at that time. That is not hearsay evidence as it is not entered to prove the statements made in the email, but only as circumstantial evidence of the fact that Mr. Ainger continued to provide property management services for the Ainger Group contrary to his statement that he had “completely” stopped working for the company.

[30] On the other hand, the emails contained in Ex. A and B are hearsay evidence, which go to the truth of the facts contained therein, which was that Mr. Ainger had negotiated a compensation package with the Ainger Group and was, in fact, earning income from the company. As well, the letter from Mr. Ainger’s friend, stating that he was the “backbone” of the company was similarly hearsay evidence (even though originally proffered by Mr. Ainger earlier in the proceedings).

[31] Hearsay evidence is permissible under r. 14(19) of the Family Law Rules which provides that an “affidavit may also contain information that the person learned from someone else” but only if “the source of the information is identified by name and the affidavit states that the person signing it believes the information is true”. Those issues are addressed in para. 1 of the Respondent’s affidavit, and the emails themselves which identify the source of the email.

[32] I note that hearsay evidence was excluded in a motion for contempt by Shaw R.S.J. in 2373963 Ontario Inc. v. Dundas, 2015 ONSC 6947. The evidence in question was hearsay evidence in an affidavit as well as a third-party email attached as an exhibit. Although this appears to be similar to the present case, I note that the evidence in that case was sought to be used in a motion for contempt, which is quasi-criminal in nature, requiring proof beyond a reasonable doubt. A motion of that nature requires a higher standard than in the present case with more serious results. Furthermore, the motion in that case was a civil motion and r. 60.11(3) of the Rules of Civil Procedure [15] only permits hearsay evidence in a contempt motion as to “facts that are not contentious”; there is no similar provision at play in the present case which would displace r. 14(19) of the Family Law Rules .

[33] As well, the Applicant cannot complain about the use of hearsay evidence in the Respondent’s affidavit; certainly he also relies upon hearsay evidence as contained in the correspondence from his physician indicating that he is unable to work. [16] He cannot have it both ways, complaining of the Applicant’s use of hearsay email correspondence and yet relying upon hearsay evidence to prove his own inability to work. Otherwise, the court would be sanctioning a double standard in order to hold the Respondent to a stricter standard than the Applicant.

[34] Finally, the Applicant complains of the Respondent’s invasion of privacy in obtaining these emails from the company server. He states that the use of the emails is akin to the “tort of intrusion upon seclusion”.

[35] Ms . Posendorf continues to be an officer and director of the company. She is the majority shareholder in the Anger Group. In her second affidavit, she acknowledges that she obtained the password to the company computer from her son, TJ. She collected the emails at a library computer as she was entitled to do based upon her position in the company.

[36] In Greenhalgh v. Verway, 2018 ONSC 3535, Quinlan J. examined an issue concerning emails obtained from an abandoned company computer. The person seeking to enter the emails into evidence was the former office administrator of the company. Quinlan J. followed Grassie v. Grassie, 2013 ONSC 1198, where Trousdale J. spoke of a three part test for admission of the evidence concerning: (1) relevance; (2) procedural fairness and (3) probative value outweighing the prejudice of entering the emails.

[37] In the present case, relevance is clearly established. In light of Mr. Ainger’s assertions as to his inability to work, the emails are obviously relevant to the issue as to his alleged incapacity.

[38] Regarding the issue of procedural fairness, Quinlan J. noted that counsel in the Greenhalgh case had given an undertaking that there were no emails on the server that were available to the party seeking to enter them, and that they would therefore not be used. However, in finding that where the party was entitled to obtain the emails, and the fact that the computer had been abandoned, Quinlan J. determined that the husband’s “expectation of privacy” was lessened and that he could not complain about the emails being used. That is similar to the present case; because Mr. Ainger claims that Ms . Posendorf can continue to be involved in the company and plays an active management role in the company, he cannot complain about her obtaining the emails through information received from TJ, especially where she remains an officer and director of the company.

[39] I note that in Greenhalgh , there was an undertaking that there were no emails on the server which would be used in evidence. Notwithstanding this, Quinlan J. allowed the emails to be used as evidence because of their probative value. That was a stronger case against production than the present case, wherein the parties agreed in Minutes of Settlement [17] that internal emails and letters from the corporation regarding the parties’ benefits from the corporation would be requested from Ainger Group. Implicit in this agreement is the fact that these emails would therefore obviously be producible in this motion. When both parties have agreed that the emails respecting the parties’ benefits from the corporation were to be produced, Mr. Ainger cannot complain about the emails which were attached as Ex. A and B to the Respondent’s affidavit and he certainly cannot have any expectation of privacy concerning emails that he agreed would be produced to counsel in this proceeding.

[40] Finally, regarding prejudice, this is a case of competing claims to impute income. Mr. Ainger says he is disabled and cannot work for the Ainger Group. He claims that Ms . Posendorf is not disabled and that she could work for the same entity and is the “controlling mind” of the corporation. Ms. Posendorf claims she is disabled and cannot work other than as an Uber driver and would have income replacement funds but for Mr. Ainger’s sabotaging of her personal injury claim. Under the circumstances, the emails have clear probative value to the issue of whether Mr. Ainger is working or can work for the company. And Mr. Ainger cannot complain about prejudice, especially where he and his daughter obtained and used personal information obtained from Ms. Posendorf [18] in their attempts to lessen her personal injury recovery. Mr. Ainger also proffered evidence obtained from a notebook of Ms. Posendorf found at the matrimonial home. It appears in this lawsuit the gloves are off, and Mr. Ainger has no right to complain about prejudice where he and his daughter, Michelle, have engaged in similar tactics.

[41] Therefore, I find the emails to be admissible in the present case.

Authentication of Emails

[42] Ms . Finbow, counsel for the Applicant, raised in argument the issue of s. 34.1(4) of the Evidence Act which reads as follows:

The person seeking to introduce an electronic record has the burden of proving its authenticity by evidence capable of supporting a finding that the electronic record is what the person claims it to be.

[43] Ms . Posendorf said that she obtained the password to the server of the Ainger Group from her son and obtained the emails from the server of the company for whom the Applicant works. The emails make it apparent that they are sent and received in the ordinary course of business and would be presumed to be admissible under s. 34.1(7) (a) of the Evidence Act .

[44] Mr. Murphy, counsel for the Respondent, states that authentication of the emails was addressed by Ms . Posendorf’s reply affidavit, which explained how she got the emails. He notes that this is all that is necessary to authenticate the emails under s. 34.1 .

[45] This appears to be confirmed by a decision of the Ontario Grievance Settlement Board, AMAPCEO and Ontario (Treasury Board Secretariat), 2017 CarswellOnt 19508 , 133 C.L.A.S. 281 where the board member suggested, at para. 19:

The test under section 34.1(4) is satisfied if there is some evidence which, if believed, establishes the electronic record is what it purports to be. The legal standard of proof is balance of probabilities. The burden of proof lies upon the party seeking to prove the document is authentic. That party must determine whether it believes sufficient evidence has been adduced to allow the adjudicator to make the determination it seeks. Put differently, it is for that party to determine what evidence to adduce. The evidence need not take any particular form. There is no requirement for independent third party evidence. In this case, each of the electronic records in Exhibits 8 and 9 is referenced in Ms . Zhu's declaration. For example, she indicates she was copied on Ms. Lim's email of January 27, 2015 found at Tab 59 of Exhibit 9 and the attached document found at Tab 3 of Exhibit 8. As argued by the Employer, this constitutes the type of evidence capable of supporting a finding that those electronic records are what the Employer claims them to be.

[46] This is confirmed by Pfizer Canada Inc. v. Teva Canada Ltd., 2016 FCA 161, where Stratas J.A. confirmed that an email can be “authenticated by the witness or someone else”. In this case, authentication has been accomplished by Ms . Posendorf’s evidence that she obtained the emails from the company server by using the password obtained from her son. She confirmed, in other words, that the emails are what they appear to be in her evidence, which are emails to and from Mr. Ainger as saved on the company server.

[47] All of this suggests that the evidence of the Respondent is sufficient to authenticate the emails, especially where the Applicant has failed to provide any evidence to the contrary. Nowhere does he deny that the emails were on the company server. The onus remains on the Respondent to authenticate the email, but at a certain point the Applicant, who was the subject matter of this extensive email dump, had some responsibility to lead evidence addressing the authenticity of the emails or whether they are what they purport to be.

Perjury Issues

[48] Ms . Posendorf’s counsel says that Mr. Ainger has perjured himself in suggesting that he has completely stopped working for Ainger Group. He suggests that this perjury means that the motion should be dismissed without consideration of the merits.

[49] Perjury is defined in s. 131(1) of the Criminal Code [19] as “a false statement under oath or by solemn affirmation, by affidavit, solemn declaration or deposition or orally, knowing that the statement is false.”

[50] It appears that the Applicant may very well have committed this offence as he deposed that he had stopped working completely as of July, 2017 and never returned to work after that date. The emails overwhelmingly demonstrate that Mr. Ainger continued to work for the company in various different capacities. There is also evidence that there was, as of December 4, 2018, a compensation package in place which allowed for a $12,000 loan from Ainger Group to Mr. Ainger, as well as reimbursement of his expenses of $4,915.86 per month or nearly $60,000 per year. This would refute the Applicant’s evidence that he lives on the charity of his son and has no income at present.

[51] Mr. Ainger claims he is only helping his children from time to time in the operation of the business gratuitously. That appears to be untrue based upon the compensation noted in the emails attached to the Respondent’s affidavit. It also appears to be untrue given the volume of the emails to and from Mr. Ainger as attached to that affidavit; that shows more than part-time or casual involvement in the corporation. He may very well have perjured himself if those emails paint an accurate picture.

[52] That being said, Mr. Murphy suggests not only that I make a finding of perjury, but that this should allow for a dismissal of the Applicant’s motion without addressing the merits. Although he provides several cases where judges have commented on perjury by affidavit, none of those cases speak to how the perjured evidence would affect the result. In R. v. Owen, 2014 ONSC 748, Ratushny J. comments on “perjury by affidavit” and stated that such perjury is “not just part of a private family feud” and “strikes at the heart of the administration of justice” [para. 46 and 47]. This sentiment is echoed by Vannini L.J.S.C. in Van Oldenbarneveld v. Van Oldenbarneveld , [1986] W.D.F.L. (H.C.) [at para. 9 et sequent. ].

[53] However, none of these cases comment on the result automatically leading to dismissal of the matter; the only result has to be that the court may find that the evidence provided by the party committing the offence is unreliable and without credibility. I do not need case law to tell me that or to make that finding.

[54] I find that the statements made by the Applicant regarding his work and his ability to work are, on the balance of probabilities, without credibility and false. His spousal support claim is problematic at best and may very well be without merit.

[55] I do not, however, find that if Mr. Ainger perjured himself, this in itself would disentitle him from seeking relief from this court. This motion must be considered on the merits, considering the fact that the moving party’s evidence as to his inability to work, as well as the fact that he denies working for Ainger Group, has been brought into serious question.

Prima Facie Case for Spousal Support

[56] The Applicant relies upon s. 40 of the Family Law Act [20] for jurisdiction to make an order for security for the Respondent’s spousal support obligation which reads as follows:

The court may, on application, make an interim or final order restraining the depletion of a spouse’s property that would impair or defeat a claim under this Part.

[57] Moreover, security for spousal support may be also ordered under s. 15.2(2) of the Divorce Act . [21] Notably, the Applicant has not cited s. 34(1) (k) of the Family Law Act as jurisdiction for this motion as that section only allows security to be ordered where there is already an order for support; where there is no order for support, this section does not give any jurisdiction for an order for security to be ordered. There is, however, ample other jurisdiction for an order for the securing of a support obligation under certain circumstances.

[58] Those circumstances were set out in Jones v. Hugo, 2012 ONCJ 211: see also Boisvert v. Boisvert, [2007] O.J. No. 2555 (S.C.J.). Relying upon Kumar v. Kumar , [1988] O.J. No. 35 (S.C.) , Sherr J. summarized the criteria as follows:

a) Where there is a history of dissipation of assets. b) Where the payor is likely to leave the jurisdiction. c) Where the payor has in the past refused to honour a support obligation. d) Where the payor has a poor employment history, has threatened to leave employment, lacks income, or has been uncooperative with the payee in the past. e) Where there are assets in Ontario capable of forming the basis of a security order or, f) Where the payor has declared he will not pay a support order.

[59] The criteria suggests some pattern of behaviour, either by way of action, statement or circumstances, from which the court would find that the responding party would be unlikely or unwilling to pay the underlying claim for which security is sought. These factors are pejorative in nature: the responding party must have done or said something which would reasonably lead the court to conclude that he or she would not comply with a court order for payment of money.

[60] In the present case, there is no order for spousal support and the issue has never been placed before the court for determination. We are early into this litigation and Ms . Posendorf has never defaulted under a court order for payment of money because no such order has yet been made. However, Ms. Finbow suggests that a finding of one or more of the Jones v. Hugo criteria is all that is required for there to be an order for security for the Respondent’s spousal support obligation. She says that there is evidence of dissipation of assets and that there is bad faith in the Respondent’s actions in not working when she is able to do so. There are assets available to secure support. Ms. Finbow states that a security order is therefore warranted under both (a) and (d) above. In particular, she says that there need not be any sort of consideration of the merits of the Applicant’s support claim.

[61] I disagree. There must be, in my opinion, at least a prima facie basis for the Applicant’s claim for support. This is suggested by the legislation in issue: under s. 15.2(2) of the Divorce Act , there is a requirement of reasonableness: this section says that the court may order security for a pending support claim “as the court thinks reasonable”. Under s. 40 of the Family Law Act , the court has the power to preserve property to avoid depletion of property which would “defeat or impair a claim” under Part III of the Act; implicit in this is the fact that the court must be satisfied that the party requesting relief has a reasonable basis for his or her spousal support claim because, without a claim for support, there can be no basis for an order securing that claim.

[62] This view is supported by Brown v. Brown, 2012 ONSC 6696, where Koke J. stated that:

In my view, security orders such as the one requested by Ms . Brown should only be made in the most unusual of circumstances, especially so in circumstances such as this where Ms. Brown's Family Law Act Claim is only a potential claim, and has not yet been heard on its merits.

[63] This would appear to indicate that, in the absence of an actual interim or final order, the claim underlying the request for security should have some merit, failing which an order should not be made.

[64] Counsel did not refer me to any case where security for support was ordered without any clear entitlement to support. In Jones v. Hugo, Sherr J. had found prima facie entitlement sufficient to make a temporary order for support. The payor in that case was already in default of a support obligation. Similarly, in Singh v. Singh, 1999 CarswellOnt 2346 (S.C.J.), where security was ordered, there was already a spousal support order which was in arrears. In Boisvert v. Boisvert, supra , the court made a child support order at trial prior to ordering security and, even so, the ordering of security was called “onerous” by the trial judge.

[65] Finally, I note that Mr. Ainger has not yet asked the court for an order for temporary spousal support and does not indicate when he might, in fact, bring a motion for temporary support. He says he did this to avoid a long motion date, which would have meant that the security might slip between his fingers while waiting for a date. However, if security is ordered without there being an order or a good basis for an order, that might allow for the Respondent’s funds being tied up indefinitely without the Applicant even requesting an order for temporary support, a result which makes no sense whatsoever and which causes indefinite ongoing prejudice to the responding party to no real purpose.

[66] From all of this, I agree that an order for security for a claim should not be lightly made, and such an order should only be made where there is either an extant order for support or a clear pathway to the claim to be secured. In the case of a claim to secure spousal support, this means that there must be, at least, a strong prima facie case for spousal support, especially where no court has yet been asked to rule on the issue of interim support.

[67] Has the Applicant provided sufficient evidence of a prima facie entitlement to spousal support? Ms . Finbow says that he has on compensatory grounds. In his affidavit, Mr. Ainger says that he has been disadvantaged “not only as a result of my marriage to Karen, but particularly as a result of my separation from her.” In particular, he complains that Ms. Posendorf “is able to walk away from the marriage with substantial assets [while] I am leaving the marriage with almost nothing” because of the bankruptcy. He says that he cannot meet his needs at this time, and continues to receive gratuitous financial assistance from the corporation. [22]

[68] Other than a claim under contract, a support claimant has to claim support based upon either compensatory or non-compensatory grounds: see Bracklow v. Bracklow, [1999] S.C.J. No. 14. A compensatory claim is a disadvantage arising from the breakdown of the marriage while non-compensatory support addresses disadvantages arising from the marriage breakdown. [23]

[69] Based upon this, it appears that the claim of the Applicant is, in fact, non-compensatory in nature; he says that he has been left with “nothing” as a result of the separation and due to illness, he is unable to work. He says that he maintained a certain lifestyle during the marriage, and it is unfair to him that he cannot now maintain that lifestyle while the Respondent can maintain hers. He also complains of the fact that he has lost his property claim because of the bankruptcy which occurred during the marriage and he wishes this to be made up by spousal support. Significantly, it is unclear from the Applicant’s evidence as to how his claim can be compensatory in nature.

[70] Prima facie is defined in Black’s Law Dictionary (9 th ed.) as being “at first sight; on first appearance but subject to further evidence or information” or “sufficient to establish a fact or raise a presumption unless disproved or rebutted”. In in Belcourt v. Chartrand, [2006] O.J. No. 1500, at para. 11, McKinnon J. stated that, for there to be a prima facie case, there must be shown to be some sort of meritorious case for support:

Ultimately however I am convinced that an order of interim spousal support should be linked to the likelihood of success at trial. There should be some reasonably sound prospect of success before interim spousal support should be ordered.

[71] Firstly, I note that an “equalization claim cannot be pursued under the guise of spousal support: see Ross v. Ross, 2014 ONSC 1828 at para. 48. The loss of the Applicant’s equalization claim is not, in itself, grounds for a claim of spousal support.

[72] Secondly, if this is a non-compensatory claim, I am not convinced that there is entitlement based upon income or imputation of income. There are several reasons for this:

(a) I am concerned about the medical evidence proffered by Mr. Ainger. His doctor has apparently based his opinion on his patient’s self-reporting as contained in the questionnaire attached to the report. That would call the report into some suspicion.

(b) As can be seen from above, I am concerned as to the reliability of Mr. Ainger’s evidence as to his inability to work. He claimed in his first affidavit that he had “not been able to return to work” [24] since July of 2017. He further stated that he “had to completely stop working for the corporation in or around the end of July of 2017.” [25] Similarly, Michelle Ainger says that her father “completely stepped away from the business” [26] as of July, 2017. The emails filed by Ms . Posendorf show these statements to be patently untrue and they further show that Mr. Ainger remains intimately involved in the running of Ainger Group on a day to day basis. I find Mr. Ainger’s evidence that he is unable to work and that he is not working for Ainger Group to be without credibility. The evidence, in fact, satisfies me that he has more income and income potential than does Ms. Posendorf and Mr. Ainger’s actual income would trump imputed income at trial.

(c) Mr. Ainger’s evidence as to his income is similarly without credibility. In his affidavit, he admits to certain benefits being paid to him. He says that TJ pays those expenses and although he admits that he receives the benefits, he also says that “I am not sure whether they are paid directly by the corporation and then repaid by T.J. or whether T.J. pays same out of pocket”. [27] However, the evidence is clear that Mr. Ainger knew exactly who was paying those expenses and that it was not TJ. The email from Micheal Ainger to the Applicant, dated December 4, 2018, makes it clear that the company was paying “6k cost benefits that go to you” [28] and a second email of the same date [29] makes it clear that the “cost benefits” included the expenses set out in Mr. Ainger’s affidavit. Mr. Ainger was not being truthful when he suggested that his son TJ was paying those expenses out of his pocket or that he did not know who was paying those expenses.

(d) Mr. Ainger complains that Ms . Posendorf “intentionally” walked away from a responsible position with the Ainger Group and suggests that income be imputed to her because she could go back to work for that company at any time. However, the correspondence from Mr. Czerwisnski which was produced by Mr. Ainger in this litigation, makes it clear that Ms. Posendorf was never the “directing mind” of the corporation and that she failed to “grow the company and be a leader.” [30] Moreover, it appears to me that Mr. Ainger’s continued involvement in that company makes Ms. Posendorf’s potential employment with the Ainger Group impossible. This litigation shows the parties to be vicious and hostile to each other and Mr. Ainger and his daughter, Michelle, admit to impairing Ms. Posendorf’s personal injury litigation, which they say was fraudulent. The parties have each made collateral attacks on each other and Ms. Posendorf complains of harassment by Mr. Ainger’s companion at a recent Collingwood court appearance. There is a restraining order in place. Ms. Posendorf says that she is seriously estranged from Michelle Ainger. To suggest that Ms. Posendorf return to work at the Ainger Group alongside by Mr. Ainger and his daughter, Michelle, is unrealistic at best. Income cannot be imputed on the basis of forcing a party to work at a clearly inhospitable workplace and it is extremely doubtful that either a motions or trial judge would force Ms. Posendorf to work at the Ainger Group under the circumstances.

[73] It also appears that Mr. Ainger is seeking this remedy because he says that he is seeking spousal support against someone who has no means of paying the support, as the claim is based upon income imputation only. That begs the question of whether there is a prima facie case for spousal support and whether a court would order temporary or final spousal support against someone with no ability to pay on the basis of imputation of income only. The hardship this works would seem to make that unlikely, and perhaps the Applicant feels that if there is a fund against which he can claim the support, it would be more likely that he would obtain a temporary spousal support award. I cannot sanction such a tactic as the claim for security is entirely dependent upon the Applicant’s chances of success in obtaining support, independent of whether there is fund from which to collect the support or not.

[74] Therefore, based upon the evidence that has been presented to me, it does not appear that Mr. Ainger has any sort of meritorious claim for spousal support. There is little likelihood of Mr. Ainger succeeding in his spousal support claim based upon imputed income when he apparently is earning more actual income than is Ms . Posendorf. Because there is no real valid claim for spousal support and no actual order, temporary or otherwise, for spousal support, there is no basis for the court ordering security for that claim under either s. 15.2(2) of the Divorce Act or s. 40 of the Family Law Act .

Merits of Claim for Security

[75] Finally, if I am wrong in finding that the court must satisfy itself that the claimant has a meritorious claim for spousal support, I wish to return to the criteria for the granting of security for a claim as summarized by Sherr J. in Jones v. Hugo. For Mr. Ainger, the major issue warranting security for his spousal support claim is the alleged dissipation of funds by Ms . Posendorf.

[76] In his affidavit, Mr. Ainger says that Ms . Posendorf received $296,989.51 from the sale of a vacation property in Georgia. He says she also received $35,000 from her personal injury claim. He says that her financial statement indicates that there is nothing left from either of these sources and this shows that she has gone through nearly $332,000 in 17 months since the date of separation in May, 2017 to the date she swore her financial statement in October, 2018. He says that this dissipation of assets indicates that security will be necessary respecting the net proceeds of her home that she recently sold as these funds will also be spent, leaving him nothing to pay his spousal support claim.

[77] Ms . Posendorf says that she did not dissipate funds, but acknowledges living off of the proceeds of the sale of the Georgia property after it was sold. She says that she had available to her from the Georgia property the sum of $254,481.80 and that, after paying debts, capital gains taxes and legal fees, as well as purchasing a trailer, she had $140,000 left over that she spent over the 20 months leading up to the filing of material for this motion.

[78] In fact, that is not quite accurate. Looking at the Respondent’s financial statement sworn on January 4, 2018, it is clear that she had available to her on the date of separation cash assets of $332,681.80. At the end of the day, on the date that the financial statement was sworn, she had left $5,091.88 which means that her cash assets had reduced by $327,589.92 in the 20 months after separation.

[79] Taking into account the CRA debt that she said that she paid of $17,000, her legal fees of $32,000, the trailer purchase of $7,900 and the fact that the financial statement shows that her debts were reduced by $93,375.61, she spent $150,275.61, leaving $177,314.31 that she says that she lived on after separation. Considering the fact that her budgeted expenditures were $5,972.93 per month (she acknowledges that her partner contributes $1,000 per month towards her household expenditures), she should have spent $119,458.60 over the 20 months since separation. In fact, she spent $177,314.31, leaving the amount of $57,855.71 (or 17.7% of the funds spent) unaccounted for. The question is whether this constitutes “dissipation of funds” which would warrant an order for security for spousal support.

[80] Dissipation of funds implies that a party has squandered or misspent a significant amount of money in some manner. Black’s Law Dictionary goes further, defining “dissipation” as “the use of an asset for an illegal or inequitable purpose”. [31] Other than the fact that about 18% of the funds are unaccounted for by the Respondent, there is no indication that she has misspent or squandered funds. Ms . Posendorf confirms that she is unable to account exactly for the expenditure of funds; she says that she has “not tracked exactly how I have spent my funds since separation, as I never believed there was a need to.” [32] It is doubtful that anyone knows exactly how much they spend on his or her living expenses. I am not willing to make a finding that the Applicant has dissipated funds on this factor alone.

[81] As noted above, ordering security for an obligation is an onerous and extraordinary remedy. It is usually done where there has been some sort of history of financial irresponsibility or wrongdoing or an indication that a party will wrongfully avoid or refuse to honour a court order for payment of money. Other than the failure to account for funds as discussed above, there is no other indication that the Respondent has unreasonably run up debts or otherwise shown herself to be financially irresponsible. There have been no threats not to pay support other than making her own claim for support. Ms . Posendorf has no foreign connections. Unlike Jones v. Hugo, this is not a case that “calls out for aggressive enforcement” as there is presently nothing to enforce and no evidence that the Respondent has disobeyed any court orders in the past.

[82] Ms . Posendorf also notes that she has other assets in Ontario, being the equity in the matrimonial home formerly in the names of both spouses but transferred to Ms. Posendorf on the eve of Mr. Ainger’s bankruptcy. There is, however, a dispute about the value of the home. Although I do not understand the details of this, I understand that the trustee has set aside this transfer under the provisions of the Bankruptcy and Insolvency Act . [33] However, I do not understand exactly where that stands as Mr. Ainger deposed that the parties had to pay the trustee $7,000 for his equity in the home ($14,000 in total for both parties). Yet Ms. Posendorf deposes that she has offered the trustee $110,000 for the equity in the home; she complains that the trustee is considering a smaller offer from Mr. Ainger and his daughter, Michelle. [34]

[83] Ms . Posendorf claims that her realtor says that the home is worth over $600,000, but a more accurate account of what the home is worth is the appraisal filed as an exhibit to her affidavit which shows the home to be worth $455,000. [35] Taking into account the fact that there is a mortgage on the home with $154,148 outstanding against the property, this would leave equity in the property of about $300,000. Assuming Ms. Posendorf is unsuccessful in purchasing the Applicant’s equity in the home, she would have about $150,000 available to pay spousal support.

[84] Mr. Ainger says that this is not enough. He says that his spousal support claim is worth well over $200,000. He effectively requests that this court tie up all of Ms . Posendorf’s assets, being the matrimonial home and Peel Street equity in order to secure his claim for spousal support - a claim, as pointed out above, that has never been tested in court. I do not find that the evidence supports an onerous remedy in the face of little or no evidence of misbehaviour or financial irresponsibility on the part of the Respondent.

[85] I also find Mr. Ainger’s request for security somewhat incongruous when Ms . Posendorf might have had an extra $200,000 or more in liquid assets had Mr. Ainger and his daughter not offered to testify against Ms. Posendorf in her litigation. It seems to me that to ask the court to tie up all of the Respondent’s present assets when this might not have been otherwise necessary both rewards the Applicant’s actions in sabotaging Ms. Posendorf’s lawsuit, and imposes further undue hardship on her. In this very bitter and acrimonious litigation, it appears that Ms. Posendorf may be correct in her assessment that Mr. Ainger is doing everything he can to “destroy” her. [36] If that is the case, then this court will not be a party to that.

[86] I therefore find that, irrespective of the issue of the Applicant’s prima facie claim for spousal support, there is insufficient merit to his claim for security for support to grant the relief requested.

CONCLUSION

[87] Mr. Ainger’s claim for security for support is therefore dismissed with costs.

[88] There shall be an order setting aside the consent Order of Jain J. requiring the Respondent’s lawyer to hold $160,000 in trust from the net proceeds of the sale. Those funds shall be forthwith released to the Respondent.

[89] If the parties cannot agree as to costs, the parties may make written submissions as to costs, the Respondent first and then the Applicant on a ten-day turnaround. Submissions shall be made through my judicial secretary in Barrie. Costs submissions shall be no more than four pages in length not including offers to settle or bills of costs.

Mr. Justice J.P.L. McDermot

Date: April 9, 2019

[1] Applicant’s affidavit sworn January 25, 2019, Ex. H. The letter is based upon a questionnaire completed by Mr. Ainger and attached to the letter.

[2] See the letter from Ms . Posendorf’s personal injury solicitor attached as Ex. W to her affidavit sworn February 1, 2019. In that letter, he noted that Mr. Ainger told the Defendant’s counsel that he was “available at any time to assist” and offered to “stand up in court against Ms. Posendorf if need be.” According to Mr. Aitcheson, the actions of Mr. Ainger resulted in “too much risk with proceeding any further with the lawsuit.”

[3] O. Reg. 114/99 .

[4] R.S.O. 1990, c. E.23

[5] Found at Tab 20 of Vol. 3 of the Continuing Record.

[6] Found at Tab 18 of Vol. 2 of the Continuing Record.

[7] Ibid , paras. 10 and 11.

[8] Ibid , at para. 17.

[9] Found at Tab 21 of Vol. 4 of the Continuing Record.

[10] Affidavit of the Respondent sworn February 6, 2019 and found at T. 21 of V. 4 of the Continuing Record, para. 2.

[11] Filed before Mr. Ainger’s reply affidavit and found at T. 19, V. 3 of the Continuing Record.

[12] Applicant’s affidavit, sworn January 25, 2019, para. 35.

[13] Ibid , para. 39.

[14] CED 4 th (online) “Evidence” (XII.1) at §575

[15] R.R.O. 1990, Reg. 194

[16] See the Applicant’s affidavit sworn January 25, 2019, Ex. H which is a letter from the Applicant’s physician which is clearly hearsay evidence.

[17] See para. 9(d) of the Minutes of Settlement signed by both parties on January 23, 2019.

[18] Information apparently obtained from her Fitbit.

[19] Criminal Code of Canada , RSC 1985, c C-46.

[20] R.S.O. 1990, c. F.3

[21] R.S.C. 1985, c. 3 (2 nd Supp.).

[22] Affidavit of the Applicant sworn January 25, 2019 found at T. 15 of V. 2 of the Continuing Record, para. 74 to 76

[23] Divorce Act , s. 15.2(6)(a) and (c).

[24] Ibid , para. 35.

[25] Ibid , para. 39.

[26] Affidavit of Michelle Ainger sworn January 29, 2019, para. 18.

[27] Affidavit of the Applicant sworn January 25, 2019 found at T. 15 of V. 2 of the Continuing Record, para. 78.

[28] Email from Michael Ainger to the Applicant dated December 4, 2018 attached as Ex. A to the Affidavit of the Respondent sworn February 1, 2019, and found at T. 20 of V. 3 of the Continuing Record.

[29] Ibid , Ex. B.

[30] Ibid , Ex. U.

[31] 9 th ed. at p. 541

[32] Ibid , para. 98.

[33] Bankruptcy and Insolvency Act , RSC 1985, c B-3.

[34] Ms . Posendorf deposes that the $14,000 was actually paid to remove a caution registered by the trustee against the matrimonial home and did not pay out any claim for the equity. Ibid , para. 68.

[35] Ibid ., Ex. Y.

[36] Ibid., para. 57