Court File and Parties

Court File No.: FC-14-79-0 Date: 2019/09/20 Superior Court of Justice – Ontario

Re: Andrew MacInnis, Applicant And: Lisa Cross, Respondent

Before: J. Mackinnon J.

Counsel: John Summers, for the Applicant Erin Lepine, for the Respondent

Heard: September 10, 2019

Endorsement

[1] The respondent moves to strike the Application or to suspend a temporary spousal support order in favour of the applicant, based on his non-compliance with a disclosure order, incomplete undertakings and failure to move his case forward in a timely way.

[2] The applicant disagrees that he is responsible for the pace of the litigation. He submits that he has provided significant disclosure, that the remaining items are not of great significance to the issues in the case and do not warrant the sanctions sought.

[3] The motion was brought on notice returnable on a date set for a settlement conference. Both parties agree the court has jurisdiction to hear the motion by reason of the Family Law Rules, O.Reg. 114/99 as am and Burke v. Poitras, [2018] O.J. No. 6596 (C.A.).

Procedural History

[4] The Application was issued January 14, 2014. The Answer was delivered on March 13, 2014. A Notice of Approaching Dismissal was issued January 21, 2015 and set aside on consent on May 15, 2015. The timetable to schedule a settlement conference and set the matter down for trial was extended to May 31, 2016 to accommodate ongoing progress towards resolution. The timetable was later extended again on consent to March 31, 2017.

[5] The applicant brought a motion for temporary spousal support. On consent on August 24, 2017, a without prejudice spousal support of $2500.00 per month was made as a term of adjournment. This order continues in effect. In November 2017, the applicant was questioned. Several undertakings he gave are still outstanding.

[6] The next scheduled date was February 20, 2019 when a disclosure order was made imposing obligations on both parties. The respondent completed her productions on April 26. Some disclosure was provided by the applicant on June 7, 2019. His 2018 Income Tax Return has since been produced.

[7] On July 5, 2019, respondent’s counsel detailed the outstanding disclosure. She put the applicant on notice that if not forthcoming a ruling under the FLRs r 1 (8) would be sought at the settlement conference scheduled in September. The outstanding disclosure is as follows:

1. Proof of total income received in 2018;
2. Notice of Assessment for 2018;
3. Proof of current income from all sources, including CPP;
4. Confirmation of drug coverage he is eligible for, details and criteria for the program, and follow-up on same;
5. Medical records related to the care received from pain management clinic from his referral to the current date;
6. Pharmacy records for all prescriptions filled and received in 2016, 2017, and 2018; and
7. Hospital discharge Statement for consult with Dr. Hewlett on June 12, 2018.

[8] FLRs r 1 (8) states:

FAILURE TO OBEY ORDER

(8) 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 any 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 was 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 the case; and

(g) on motion, a contempt order. O. Reg. 322/13, s. 1.

Issues in the Case

[9] The applicant makes two substantive claims; for spousal support and for a finding of a Joint Family Venture and an equal share in property accumulated during the cohabitation. None of the outstanding disclosure relates to the JFV / property claim.

Factual Context of the Spousal Support Claim

[10] This was a cohabitation of about 16.5 years. The parties were 36 and 38 years of age at the outset. They did not have children together. The respondent was a medical doctor with an established practice. She had and continues to have an adult child living with her who has significant challenges, which the respondent addresses at considerable financial cost. The applicant was employed as a personal caregiver and subsequently took on responsibilities which he says extended to their household and her practice.

[11] During cohabitation a property was purchased in Mabou, Nova Scotia, in joint names. This is where the applicant has resided since soon after the separation.

[12] The applicant has not been employed since separation. He says he is medically unable to work. The respondent disagrees. She submits he is capable of at least part-time employment. She says the applicant is addicted to prescribed pain medications and that this is strongly related to his unemployed status. Additionally, she seeks to establish that the applicant is not taking sufficient or reasonable measures to address the addiction, thereby not meeting his responsibility to do his best to contribute to his own support.

[13] The respondent’s Answer denies the applicant is entitled to spousal support. To that she now says any entitlement to spousal support related to the cohabitation has been met by payments she has already made to or on his behalf. These include direct payments for the Mabou property he occupies, voluntary payments to him prior to the court order and payments pursuant to the order. She totals her expenditures to and on behalf of the applicant at $186,369.84, to the end of August 2019.

[14] The applicant’s position is that he is entitled to indefinite spousal support, needs based and compensatory, that the payments made to date have been inadequate and should be adjusted upward, retrospectively and prospectively.

Applicable Law

[15] The decision in Roberts v. Roberts, 2015 ONCA 450 at paras 11-12 clearly articulates the importance of making financial disclosure:

11 The most basic obligation in family law is the duty to disclose financial information. This requirement is immediate and ongoing.

12 Failure to abide by this fundamental principle impedes the progress of the action, causes delay and generally acts to the disadvantage of the opposite party. It also impacts the administration of justice. Unnecessary judicial time is spent and the final adjudication is stalled.

[16] In Manchanda v. Thethi, 2016 ONCA 909 the Court clarified that willful non-compliance is egregious and exceptional as required by the test to strike pleadings set out in Kovachis v. Kovachis, 2013 ONCA 663:

13 Our second reason is this: after continual admonitions by the courts and the legislature that parties to a matrimonial proceeding must produce financial documentation, willful non-compliance must be considered egregious and exceptional. This court has stated that the most basic obligation in family law proceedings is the duty to disclose financial information. The requirement is immediate and ongoing: Roberts v. Roberts, 2015 ONCA 450, 65 R.F.L. (7th) 6, at para. 11.) In 2015, Family Law Rule 13 was amended to emphasize a party's financial disclosure obligations. A party's non-compliance must be considered in the context of this strict financial disclosure obligation. Rule 1(8) provides the court with the authority to strike claims. Those who choose not to disclose financial information or to ignore court orders will be at risk of losing their standing in the proceedings as their claims or answers to claims may be struck.

[17] The Court of Appeal provides a decision-making framework for the application of FLRs r 1 (8) in Mullin v. Sherlock, 2018 ONCA 1063, [2018] O.J. No. 6743:

44 First, when faced with an allegation of failure to obey a disclosure order, before granting a remedy, the judge must be satisfied that there has been non-compliance with the court order.

45 Second, once satisfied, a judge may have recourse to the alternatives described in Rule 1(8). In assessing the most appropriate remedy, a judge should consider the following factors:

*the relevance of the non-disclosure, including its significance in hindering the resolution of issues in dispute;

*the context and complexity of the issues in dispute, understanding that an uncomplicated case should have little tolerance for non-disclosure, whereas a case involving extensive valuation of assets may permit some reasonable delay in responsiveness;

*the extensiveness of existing disclosure;

*the seriousness of efforts made to disclose, and the explanations offered by a defaulting party for the inadequate or non-disclosure; and

*any other relevant factors.

46 Having considered these factors, the judge will then determine the best remedy. The orders identified in Rule 1(8) are not exclusive. Other approaches may be appropriate. For example, one option might be to invite the moving party to seek at trial an adverse inference from the failure to disclose and for the motion judge to memorialize this invitation in reasons for decision. Parties frequently rely on another option, namely a request for an adjournment to allow for more time to effect disclosure. Occasionally this may be appropriate especially in a complex case, but an adjournment should not be automatic. Fully compliant disclosure is the expectation, not the exception.

Application to this Case

[18] It is not disputed that the applicant has not fully complied with the February 20, 2019 order or that some undertakings remain outstanding. Although he was served on August 28, no responding material was delivered. I did accept some documents already produced by the respondent from his counsel, who also provided full submissions.

[19] In my view the missing disclosure is relevant and significant. Income disclosure requires no explanation. The failure to produce the complete file from the pain management clinic and the pharmacy records for all prescriptions filled and received in 2016, 2017 and 2018 directly impairs the respondent’s ability to evaluate and prove the case she wants to put forward. The discharge statement may or may not add important information, but it must be produced. These records should be readily available to the applicant. No reasonable or persuasive explanation has been given to justify the more than six month delay since the order was made.

[20] This is not a case where the applicant has produced nothing. He has made significant disclosure, but the fact is outstanding, important and readily available court ordered productions have not been made. In the absence of a deposed explanation from the respondent I find his failure to produce the remaining disclosure is willful. The one exception is that I accept his counsel’s advice that the 2018 Notice of Assessment has not yet been received.

[21] It is also true that the case has not been pursued in a timely way. The respondent has consented to extensions but that does not detract from the applicant’s obligation to pursue his claim in a diligent and timely fashion. The respondent has a legitimate concern that the ongoing delay benefits the applicant, who has occupied a jointly owned property and received support payments in one form or another for seven years in relation to a cohabitation of 16.5 years. That said, any actual financial prejudice to the respondent is mitigated by the security provided in the applicant’s half interest in the Mabou property valued at $93,800 (i.e. one half of a total value of $187,600). This will not be a full remedy for the respondent if she succeeds in establishing that the applicant had no entitlement to spousal support in the first place. On the other hand, the payments made are below the Spousal Support Advisory Guidelines[^1] range for her income, unless and to the extent she succeeds in having her income reduced for spousal support purposes by the amounts she expends yearly on her son’s special needs. These issues are beyond the scope of this motion.

[22] Drawing an inference at trial that the documents the applicant has not produced would not assist him or would hurt his case is not an adequate remedy. The questions of alleged long-term addiction to prescribed narcotic painkillers, whether the applicant is taking appropriate steps to address any addiction and is compliant with recommended treatment are complicated and ought not to be left to be dealt with by inference.

[23] Further, I disagree with the applicant’s submission that whether he is or is not addicted to prescribed painkillers has little relevance to his spousal support claim. To the extent that his claim is needs based, his onus will be to establish that his need was and is related to the cohabitation. The law does not say that all need is properly addressed by spousal support. Both the respondent and the court should have all the court ordered information on this important issue before being called on to present or settle a case or render a decision.

Decision

[24] The court, counsel and the parties all have important obligations imposed by FLRs r 2(2) – (5):

PRIMARY OBJECTIVE

(2) The primary objective of these rules is to enable the court to deal with cases justly. O. Reg. 114/99, r. 2 (2).

DEALING WITH CASES JUSTLY

(3) Dealing with a case justly includes,

(a) ensuring that the procedure is fair to all parties;

(b) saving expense and time;

(c) dealing with the case in ways that are appropriate to its importance and complexity; and

(d) giving appropriate court resources to the case while taking account of the need to give resources to other cases. O. Reg. 114/99, r. 2 (3).

DUTY TO PROMOTE PRIMARY OBJECTIVE

(4) The court is required to apply these rules to promote the primary objective, and parties and their lawyers are required to help the court to promote the primary objective. O. Reg. 114/99, r. 2 (4).

DUTY TO MANAGE CASES

(5) The court shall promote the primary objective by active management of cases, which includes,

(a) at an early stage, identifying the issues, and separating and disposing of those that do not need full investigation and trial;

(b) encouraging and facilitating use of alternatives to the court process;

(c) helping the parties to settle all or part of the case;

(d) setting timetables or otherwise controlling the progress of the case;

(e) considering whether the likely benefits of taking a step justify the cost;

(f) dealing with as many aspects of the case as possible on the same occasion; and

(g) if appropriate, dealing with the case without parties and their lawyers needing to come to court, on the basis of written documents or by holding a telephone or video conference. O. Reg. 114/99, r. 2 (5).

[25] The court is interested in both disposing of cases on their merits and ensuring that respect for the administration of justice is upheld by enforcing compliance with its orders. To accomplish this, I make the following order.

[26] A timetable is imposed on the applicant:

1. He shall complete the outstanding disclosure on or before October 30, 2019.
2. He shall deliver his TSEF by November 15, 2019.
3. He shall obtain a settlement conference date now to take place after November 15 and before January 15, 2020. Two hours should be scheduled for the conference.
4. In the event the applicant does not comply with any aspect of the timetable, the motion to strike shall be returned to me for further disposition.

[27] The respondent shall deliver her TSEF on or before the settlement conference date.

[28] To address the negative impact of the delay on the respondent I make the exceptional order of listing the application now for trial in the May 2020 sittings, preemptory to the applicant.

[29] Rule 1 (8.1) empowers the court to sanction non-compliance with the FLRs:

FAILURE TO FOLLOW RULES

(8.1) If a person fails to follow these rules, the court may deal with the failure by making any order described in subrule (8), other than a contempt order under clause (8) (g). O. Reg. 322/13, s. 1.

[30] The applicant did not provide the up to date financial statement or affidavit as required by r 13(12). His most recent financial statement from April 2019 shows a monthly expense of $1,000 per month for a VISA debt of $2,000. I infer based on his non-compliance with the rule that this debt is paid in full. After applying his own income to the remaining expenses his monthly shortfall is reduced to $1,930.

[31] In view of the slow progress of the litigation, the default in financial disclosure, non-compliance with r 13(2), and to uphold respect for the administration of justice by limiting the applicant from benefiting further from one order of the court while not complying with another, I make two further orders:

1. The temporary without prejudice spousal support order dated August 24, 2017 is stayed from October 1, 2019 until the applicant has produced the remaining disclosure, noting that his 2018 Notice of Assessment shall be provided on receipt.
2. When the stay is lifted by the completion of the disclosure, the amount of spousal support required to be paid pursuant to that order shall be reduced to $1930 per month.

[32] If counsel cannot agree on the issue of costs, I will receive written submissions not to exceed three pages plus a Bill of Costs and any relevant offers, from the respondent by October 30, followed by the applicant by November 21, with a brief right of reply if necessary, by November 27, 2019.

J. Mackinnon J.

Date: September 20, 2019

Court File No.: FC-14-79-0 Date: 2019/09/20

ONTARIO SUPERIOR COURT OF JUSTICE

Re: Andrew MacInnis, Applicant And: Lisa Cross, Respondent

Before: J. Mackinnon J.

Counsel: John Summers, for the Applicant Erin Lepine, for the Respondent

ENDORSEMENT

J. Mackinnon J.

Released: September 20, 2019

[^1]: prepared for the Department of Justice Canada, July 2008, http://www.justice.gc.ca/eng/fl-df/spousal-epoux/ssag-ldfpae.html