Court File and Parties

COURT FILE NO.: FS-28-08 DATE: 2020-04-22

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JO-ANN LAURIE TAMBEAU, Applicant AND KENNETH MARTIN, Respondent

BEFORE: The Honourable Madam Justice D. Piccoli

COUNSEL: Farah Hakim, Counsel for the Applicant Robert K. Bickle, Counsel for the Respondent

HEARD: March 5, 2020

ENDORSEMENT

[1] On March 5, 2020, I heard the motion found at Volume 2, Tab 19 of the Continuing Record brought by the Respondent, Kenneth Martin, (“Respondent”), whereby he sought:

1. An order discharging the Certificate of Pending Litigation issued with respect to the property municipally known as 432 Gustavus Street, Port Elgin, Ontario and registered on October 21, 1994 as Instrument No. R307213;
2. An order that the within application be dismissed with costs;
3. An order for substituted service of the motion and supporting affidavit if necessary;
4. Costs of the abandoned application on a full indemnity basis;
5. Costs of this motion on a full indemnity basis; and
6. Such further and other relief as counsel may advise and this Honourable Court deem just.

[2] There are two affidavits filed in reference to this motion, namely the affidavit of the Respondent sworn November 16, 2018 and the affidavit of the Applicant, Jo-Ann Laurie Tambeau, (“Applicant”) sworn May 8, 2019.

Brief Background of the Relationship

[3] The parties met on May 13, 1989. They have one child together, Somer. Somer is 29 years of age and independent. The Applicant has two other children who are not the biological children of the Respondent.

[4] The parties do not agree as to the date of separation; the Applicant asserts the final separation occurred in 1993 after a period of reconciliation. The Respondent states the parties separated on April 12, 1991.

[5] The parties entered into a three-page separation agreement dated April 25, 1991, the validity of which is in dispute. Paragraph 6(a) of that separation agreement speaks to the release against property. There is no reconciliation clause in the separation agreement.

[6] The Respondent disputes the reconciliation. Despite that, in a different proceeding, he swore an affidavit dated September 17, 1994 whereby he confirmed that he was ordered to pay $450.00 a month for the support of Somer commencing August 15, 1991, but he did not do so as shortly following the order, he and the Applicant “got back together”.

[7] The Respondent asserts that the separation agreement is valid and binding and that he met all of his obligations under the separation agreement. The Applicant asserts that as the parties subsequently reconciled, the agreement is “void”. She relies on the Ontario Court of Appeal decision in Sydor v. Sydor (2003), , 178 O.A.C. 155. Also see Miaskowski v. MacIntyre, 2020 ONCA 178. She further asserts that the Respondent did not meet his obligations under the separation agreement.

[8] The parties agree that the property located at 432 Gustavus Street, Port Elgin, (“the Port Elgin property”) was to initially be purchased by the Applicant and her brother Sean McCauley (“Sean”) ; that the parties both contributed monies towards the purchase price of the property: the Applicant $47,000.00 and the Respondent $40,000.00; that title to and the mortgage for the Port Elgin property was taken in the Respondent’s name.

[9] The dispute with respect to the Port Elgin property centers around whether the Applicant’s contribution to the purchase of the Port Elgin property was a loan by the Applicant to the Respondent (which is the Respondent’s assertion) or whether it represented the Applicant’s investment in the property such that she has a resulting or constructive trust interest in same.

[10] If the Applicant’s contribution was a loan, then the dispute arises as to whether the loan has been repaid.

[11] The Applicant commenced this action by way of a Notice of Application under the Family Law Act on July 20, 1994.

[12] In her application, she sought:

1. Child support for the parties’ child, Somer, as well as her two other children;
2. Spousal support;
3. Division of assets “held by the Respondent”, by way of a resulting and constructive trust and immediate return of all personal belongings, clothing of the Applicant and children;
4. A restraining order;
5. An order directing that a Certificate of Pending Litigation be registered against the home located at 432 Gustavus Street, Port Elgin Ontario (hereinafter referred to as (the Port Elgin property”);
6. Costs; and
7. Abridging time for service, allowing for late filing if warranted, and such further and other relief as the Court orders.

[13] In addition to the Application, the Applicant relied on her affidavit and financial statement sworn June 13, 1994, the affidavit of her brother Russell Tambeau, (“Russell”) sworn June 22, 1994 and the affidavit of Melissa Marsden, sworn June 13, 1994.

[14] The Applicant brought a motion originally returnable August 17, 1994 seeking, among other things, child support for three children, spousal support, a non-harassment order, the return of her and the children’s clothing and personal belongings and a Certificate of Pending Litigation against the Port Elgin property.

[15] The Respondent served a notice of appearance indicating his intention to respond to the application dated September 16, 1994. He also relied on an affidavit he swore on September 17, 1994 and his financial statement sworn October 16, 1993 in a different court proceeding in support of his defence and in answer to the Applicant’s motion.

[16] The Applicant responded to the Respondent’s affidavit by serving supplementary affidavits; from herself dated September 30, 1994, her brother Russell dated October 2, 1994, her brother Sean sworn October 3, 1994 and four other affidavits from friends or acquaintances.

[17] The interim interim order of Justice Morrison of October 5, 1994 followed the hearing of said motions.

[18] A Certificate of Pending Litigation (“CPL”) was registered on the Port Elgin property on October 21, 1994 as Instrument No. R307213.

[19] Cross-examinations of the parties took place on May 11, 1995. The transcripts of those cross-examinations are in the court file.

[20] On February 29, 1996, the Applicant served a Notice of Intention to Act in Person.

[21] In March 1996, the Respondent brought a motion seeking to dismiss the Applicant’s claim for failure to comply with undertakings. In the alternative, he asked the court to vary the child support, to discharge the CPL registered on the Port Elgin Property and direct a trial of an issue on the constructive trust/resulting trust claim. In his affidavit in support of the motion, he also questioned whether he was Somer’s father and, in the body of the affidavit, requested blood tests.

[22] The Applicant responded and brought her own motion for child support.

[23] These motions were heard on March 21, 1996.

[24] Two orders flowed from these motions, namely the order of Justice Sills dated March 21, 1996 and the order of Justice Kent dated June 26, 1996.

[25] In 1997 the Applicant’s Legal Aid certificate was “pulled”.

[26] The Respondent brought the issues adjourned from the June 26, 1996 order with respect to the Certificate of Pending Litigation, and trial of an issue, back before the court with a first return date of March 24, 1999. In his affidavit in support of this motion, the Respondent’s position was that other than examinations for discovery which had been held May 1995, the Applicant had done nothing further to advance her claim and, accordingly, the Certificate of Pending Litigation should be discharged – he stated that he had the financial ability to satisfy any claim.

[27] In response, the Applicant brought a cross motion for an order enforcing the extended health coverage for Somer and Paige, and in the alternative, sought that the Respondent pay the health care costs for the children. At the time, she was self-represented. In her affidavit filed in support of the cross motion she set out her health issues, including illness from Hepatitis “C” for which she was diagnosed in November 1995 (prior to that she stated that she was violently ill for 4 years). She stated that she suffered from Battered Spouse Syndrome and the impacts of the Respondent’s behaviors of alcoholism. She further deposes that the children attended counselling for 2 years to help them understand the Respondent’s illness and his abusive behaviour. She refers to fleeing her home “to escape the physical, mental and verbal abuse of the Respondents (sic) and his addiction to alcohol.”

[28] These motions were adjourned on May 12, 1999 sine die returnable on 10 days’ notice. The only issue dealt with on consent on May 12, 1999 was with respect to medical expenses/claims.

[29] Nothing happened for almost 9 years.

[30] A case conference notice was issued on April 7, 2008 with respect to the issues of retroactive and on-going child support and section 7 expenses, disclosure and costs.

[31] A case conference was held on April 28, 2008 by Justice Pazaratz, limited to the support issues.

[32] The Applicant brought a motion first returnable on August 13, 2008 for the same issues dealt with at the case conference.

[33] The Respondent sought questioning of the Applicant. That questioning took place on August 28, 2008 on the issues of support. A transcript of the questioning is in the court file.

[34] The motion of August 13, 2008 was eventually resolved by the two orders of Justice Flynn dated September 17, 2008 and November 30, 2009.

[35] Nothing then happened for almost 10 further years.

[36] This motion was then brought, first returnable on February 13, 2019, adjourned on consent to May 15, 2019 to allow for the service and filing of responding materials and reply materials, and then on May 15, 2019 was adjourned to the week of June 3, 2019 for a one-half day long motion. It was not reached during that week. It was reached and heard by me on March 5, 2020.

[37] From the Motion of the Respondent it can be seen that the Applicant was not represented by counsel when this motion was served.

Previous Orders Made

[38] October 5, 1994 – Justice Morrison made an interim interim order for child support, a mutual restraining order, the immediate return of the Applicant and children’s personal belongings and clothing. He also ordered that a Certificate of Pending Litigation be registered against the Port Elgin property. Paragraph 6 of the Order required the Respondent to maintain the Applicant and children as beneficiaries of any and all extended health and life insurance benefits available to him through his employment.

[39] March 21, 1996 – Justice Sills made an order that the Applicant comply with seven undertakings within 30 days, failing which the Respondent could move ex parte to dismiss the Applicant’s claim. The balance of the motion was adjourned sine die returnable on 4 days’ notice. On May 22, 1996 the motion was adjourned to June 26, 1996 to allow Legal Aid to respond to the application peremptory on the Applicant in that Justice Sills directed it proceed whether the Applicant had a lawyer or not.

[40] June 26, 1996 – Justice Kent made an interim order varying the child and spousal support order of Justice Morrison dated October 5, 1994. The balance of the motion was adjourned sine die returnable on four days’ notice by either party. In his endorsement he stated “there is no need for an immediate decision on whether the Certificate of Pending Litigation should be discharged particularly when the parties are giving some consideration for settlement. Issues addressed in paragraph 2(b) and (c) are therefore adjourned sine die to be returned on 4 days’ notice by either party”. The issues in 2(b) and (c) of the Notice of Motion were the Respondent’s request to discharge the certificate and his further request directing a trial of the issue.

[41] June 27, 1996 – Justice Kent made an order for time limited support, an increase in child support for Somer and no child support for the children Tim and Paige.

[42] September 17, 2008 – Justice Flynn made a Final Order based on Minutes of Settlement finalizing the issue of child support arrears, retroactive child support, fixed and non-variable child support, section 7 expenses, and costs with respect to the child support issue. The order of Justice Kent of June 1996 was specifically not varied. This order brought finality to the obligations of the parties in the June 26, 1996 order. The order of Justice Morrison of October 5, 1994 and, in particular, paragraph 6 was converted to a final order.

[43] November 30, 2009 – Justice Flynn made an order amending his previous order requiring that support for Somer continue until February 1, 2010 without requiring proof of enrolment of Somer in school.

Dispute Between the Parties

[44] The primary property dispute between the parties is with respect to the Port Elgin property. There is a secondary dispute with respect to $15,000.00 that the Applicant states she provided to the Respondent for the purchase of a boat.

[45] In respect of the boat, the Respondent denies that the Applicant contributed any money towards the purchase of the boat. He attaches a copy of a loan agreement to his September 17, 1994 affidavit. The Applicant maintains that she did give the Respondent $15,000.00 which he used to pay down his line of credit which allowed him to then take out the loan to purchase the boat. In 1994 she stated that she ordered a copy of the cancelled cheque from the bank.

[46] Both parties agree that they were going to jointly purchase a home in Port Elgin in June 1989. They agree that the Applicant put $47,000.00 towards the purchase of the Port Elgin property; $40,000 towards the purchase price and $7,000.00 towards land transfer tax, lawyer’s fees, disbursements, etc. (see paragraphs 34 and 35 of the Respondent’s affidavit dated September 17, 1994).

[47] The Respondent states the Port Elgin property was put into his name because of the Applicant’s welfare status. He maintains that the Applicant’s contribution was a loan. He swore three affidavits in these proceedings that itemized or explained his repayment of said loan, namely his affidavit of September 17, 1994, with exhibits attached, his affidavit of January 8, 1996, which has no exhibits attached, but in which the Respondent states “my repayment of same which I have documented during the course of my examination for discovery and subsequently through undertakings”, and his affidavit of November 16, 2018, with exhibits attached.

[48] He maintains that he has repaid the loan in part as follows:

(a) in August 1990 he purchased a Pontiac Grand Prix for the Applicant at a cost of $3,234.60; (September 17, 1994 affidavit and November 18, 2018 affidavit); (b) he paid a Sears bill for the Applicant in the amount of $2,216.61 dated March 14, 1991 for which he cannot locate a copy of the bill; (November 18, 2018 affidavit); (c) in April 1991, he purchased a 1986 Nissan 300XZ for the Respondent at a cost of $12,059.50; (September 17, 1994 affidavit and November 18, 2018 affidavit); (d) in April 1991, he deposited the sum of $8,000.00 into the bank account of the Applicant’s brother, Sean, to extinguish a debt owed by the Applicant to this brother; (September 17, 1994 affidavit and November 2018 affidavit); (e) in April 1991, he arranged a cash advance against his Visa in the amount of $3,000.00 which he states was also given to Sean; (September 17, 1994 affidavit and November 2018 affidavit); (f) he paid to the Applicant $10,000.00 on May 14, 1991, $3,000.00 on June 11, 1991 and $1,500.00 on October 2, 1991; (November 18, 2018 affidavit); (g) he paid $4,539.75 on his Visa so that the Applicant could have breast augmentation surgery; (November 18, 2018 affidavit); (h) he paid the Applicant’s brother Russell $10,000.00 on June 15, 1992 to extinguish a debt the Applicant owed to him; (September 17, 1994 affidavit and November 18, 2018 affidavit); (i) he deposited $2,400.00 into the Applicant’s bank account on December 23, 1992; (November 18, 2018 affidavit); (j) he deposited $400.00 into the Applicant’s bank account on January 7, 1993; (November 18, 2018 affidavit); and (k) he suffered losses in a sub business which he states was a joint venture with the Applicant which he seeks to set off against the amount owing to the Applicant. (September 17, 1994 affidavit).

[49] Attached to his affidavits in support of his contentions are, among other things, the bill of sale for the Nissan, a cheque payable to Camron Motors, a copy of his bank statement showing the cheque came out of the account and a copy of the cancelled cheque, the purchase agreement for the Pontiac, copies of what he states are the cancelled cheques payable for $10,000.00, $3,000.00 and $1,500.00, a copy of a Visa statement dated August 7, 1991, a deposit receipt for $2,400.00 and $400.00 respectively.

[50] The Applicant denies the $47,000.00 was a loan. She indicates that originally, she and her brother Sean were going to purchase the property and that she signed an agreement of purchase and sale to that effect. She states that after she met the Respondent, he suggested that given that she was pregnant, that he would purchase the Port Elgin property with her. The property was subsequently purchased in the Respondent’s name alone. There is no dispute that the Respondent paid all of the mortgage payments since the date of separation.

[51] In response to the Respondent’s assertions she states:

(a) the Pontiac was purchased as a company vehicle for the sub shop and the Respondent received a tax advantage as a result; (b) that she and the Respondent were together when he paid the Sears bill and at no point did, she agree that the payment of said bill would be considered a repayment of her interest in the property; (c) the Nissan was a gift promised to her if she reconciled with the Respondent; (d) the Respondent owed $5,000.00 to her brother Sean in reference to the purchase of the Port Elgin property. Her brother Sean also swore an affidavit dated October 4, 1994 which stated that the Applicant was not indebted to him and furthermore set out his explanation in reference to the purchase of the Port Elgin property; (e) same as above (d) above; (f) the monies paid into her bank account were given to her during a time when the parties were in a relationship and they did not agree that these amounts would contribute towards her interest in the property; (g) same as (f) above; (h) she did not owe her brother Russell any money – he owed her money. Her brother Russell swore an affidavit on October 2, 1994 where he confirmed that the Applicant did not owe him money. He is now deceased. The Applicant more recently provided an affidavit from their sister Ruth-Ann, who was the executor of Russell’s estate, sworn April 30, 2019. Ruth-Ann deposes that the monies were owing from Russell to the Applicant pursuant to a promissory note and that as part of the estate administration those funds were repaid to the Applicant – the promissory note is attached and dated August 3, 1989; (i) same as (f) above; (j) same as (f) above; and (k) she ran the sub shop but that it failed after she left because of the Respondent’s poor judgment and lack of dedication.

Facts Applied to the Law

[52] The Respondent asks this court to dismiss the Applicant’s application for three reasons:

(a) her application lacks particulars; (b) she has not complied with a court order for undertakings; and (c) delay.

[53] The Respondent admits that the first two reasons are not strong, and his focus is on the delay.

(a) Lack of Particulars

[54] I was not pointed to any rule or caselaw with respect to this issue. This action was commenced prior to the current Family Law Rules coming into force. At the time the application was commenced, it was proper to set out the particulars in an affidavit, both for the applicant and the Respondent, pursuant to the regulation at that time, Family Court Rules, RRO 1990, Reg 202.

[55] At any time, the Respondent was free to bring a motion seeking particulars and he did not do so. The particulars of the claim were fully flushed out in the affidavits and the cross-examinations.

[56] Accordingly, this action will not be dismissed for lack of particulars.

(b) Dismissal of Application for Failure to Follow Court Orders (in this case in reference to undertakings) Rule 1(8)

[57] The court order of Justice Sills of March 21, 1996 was such that the Applicant comply with seven undertakings within 30 days failing which the Respondent could move ex parte to dismiss the Applicant’s claim. The Respondent did not take any action in this regard.

[58] The only outstanding undertaking given by the Applicant in relation to the outstanding issues is for the production of the Agreement of Purchase and Sale, signed by her, regarding the Port Elgin property (Questioning Transcript at pages 25-26, Q167).

[59] It is unclear to me what the relevance of the Agreement of Purchase and Sale would be when the Respondent has admitted that the property was going to be purchased by the Applicant and her brother Sean.

[60] Furthermore, the Applicant states that she provided the answers to her undertakings to her previous lawyer and she relied on him to forward same to the Respondent’s then lawyer. She has reported her previous lawyer to the Law Society.

[61] The Court of Appeal in Mullin v. Sherlock, 2018 ONCA 1063, [2018] O.J. No. 6743, indicated that before granting a remedy under Rule 1(8) the judge must be satisfied that there has been non-compliance, and second, a judge must have recourse to the alternatives described in Rule 1(8). The court provided five other factors that a judge should consider in assessing the appropriate remedy. In this case, it is not necessary for me to have recourse to the alternatives as I am not satisfied that the Applicant did not comply with the order.

[62] Accordingly, this action will not be dismissed for lack of compliance with the court order of Justice Sills dated March 21, 1996 regarding undertakings.

(c) Dismissal of Application for Delay

[63] An Order dismissing an action for delay is a severe remedy, see: Langenecker v. Sauvé, 2011 ONCA 803.

[64] It is the Respondent’s position that the Application should be dismissed for delay. He states the test for dismissal of an action for delay has been met in that the Applicant and her lawyer(s) are responsible for delay which is inordinate and inexcusable. He submits there are strong policy reasons to dismiss the matter, that general assertions cannot be relied upon to excuse her delay and that she has failed to provide a reasonable excuse for the delay. Accordingly, his position is that the Applicant has not rebutted the presumption of prejudice.

[65] The Respondent asserts that if this court finds the Applicant has rebutted the presumption, he will suffer actual prejudice should the matter not be dismissed. In support of his contention, he notes that the Applicant’s brother, Russell, has died, and he is a key witness. He states that banking records and other documentary evidence is simply no longer available given the passage of time. Furthermore, he states that the Applicant does not have a reasonable claim to an interest in the land, given the signed separation agreement, and further given that she has not proceeded with reasonable diligence.

[66] In advancing her position, the Applicant acknowledges the delay has been inordinate, but she states there is a reasonable excuse for the delay, that she has rebutted the presumption of prejudice and that the Respondent has been unable to show that the delay is prejudicial to him. She also urges me to consider that dismissing an action for delay is tantamount to striking pleadings and points to the Court of Appeal decision in Chiaramonte v. Chiaramonte, 2013 ONCA 641, which stands for the proposition that in family law cases pleadings should only be struck and trial participation denied in exceptional circumstances where no other remedy would suffice.

[67] The Applicant provides many reasons for the delay which include:

(a) a blood transfusion she received in February 1990; (b) that she suffered mental, emotional and physical abuse from the Respondent; (c) that in or around 1993 she had to admit herself into a psychiatric facility but could not stay in the program as she did not trust the Respondent to take care of Somer; (d) that in 1995 she was advised that she had contracted Hepatitis “C” as a result of the blood transfusion in 1990; (e) that she was not aware that her undertakings had not been fulfilled and she had to report her then lawyer to the Law Society; (f) that in 1997 she had her Legal Aid certificate “pulled” (which certificate was for support issues only) and that she did not have the financial means to hire a lawyer; (g) that in 1999 her health and finances were “not in good shape” and she was self -represented; (h) that her main concern was having the financial means to support the children; (i) that she has been a full-time mother to three children and has unconditionally supported them in all of their activities; (j) that it took time for her to seek treatment for her mental, physical and emotional health; (k) that the Respondent stood by and watched her live-in poverty while she was suffering from serious health issues; (l) that the Respondent delayed proceedings to suit his convenience and has done everything in his power to cause her hardship and poverty; (m) that in 2008 she relied and relies on a letter from her family doctor in her motion for support which spoke to: The Applicant’s inability to work, that the Applicant and Somer lived in poverty for 3 years, that the Applicant supported her daughter unconditionally even though the “stress at times has been unbearable”. Her doctor further expressed concern about the delay in the proceedings and the impact of same on the Applicant’s physical and mental health. Her doctor further noted that the Applicant required many medications each month but had to go without them so that she could provide the necessities of life for Somer. The letter also spoke to Somer being very disturbed by the rejection of the Respondent and his negative accusations about her future; (n) that she has only been able to get her Hepatitis “C” under control this past year and was to be getting effective treatment in the Summer of 2019; (o) as the letter attached to her May 2019 affidavit from Dr. Cvetic (Obstetrics and Gynecology) makes clear, that the Applicant suffered from the debilitating effects of Hepatitis “C” and that the Applicant was starting a three-month treatment at the end of July 2019 under the care of a Gastroenterologist; (p) that she is now able to push this matter forward; and (q) that she has maintained a reasonable claim in the property.

What is the test for dismissing an action for delay?

[68] The Respondent relies on Rule 1(7) and 2 of the Family Law Rules and 3.04 and 24 of the Rules of Civil Procedure. He argues that the lack of action on the part of the Applicant triggers the court to intervene and dismiss the action for delay.

[69] The test for dismissal of an action for delay and its interpretive framework under the Rules of Civil Procedure is articulated as follows:

The principle to be applied on a motion to dismiss for delay is that the action should not be dismissed unless: (1) the default is intentional and contumelious or (2) the plaintiff or his or her lawyers are responsible for the inexcusable delay that gives rise to a substantial risk that a fair trial might not now be possible. It is presumed that memories fade over time, and an inordinate delay after the cause of action arose or after the passage of limitation period gives rise to a presumption of prejudice. Where there is a presumption of prejudice, the defendant need not lead actual evidence of prejudice and the action will be dismissed for delay unless the plaintiff rebuts the presumption. The presumption of prejudice may be rebutted by evidence that all documentary evidence has been preserved and the issues in the lawsuit do not depend on the recollection of witnesses or that all necessary witnesses are available with detailed recollection of events. If the presumption is rebutted, then the action may still be dismissed if the defendant leads convincing evidence of actual prejudice.

Reference: Armstrong v. McCall, [2006] O.J. No. 2055, 2006 CarswellOnt 3134 (Ont. C.A.), at para. 11.

[70] A finding that either of the two branches of the test is met is sufficient to dismiss the action. An inexcusable delay is said to exist if “there is no ‘reasonable and cogent’ excuse for the delay”: New Solutions Financial Corp. v. Zilkey, 2011 ONSC 448, 2011 CarswellOnt 332 (Ont. S.C.J.), at para. 14.

[71] The Respondent is not pursuing the first branch of the test – he relies on the second branch, namely that the Applicant or her lawyers are responsible for the inexcusable delay that gives rise to a substantial risk that a fair trial might not now be possible.

[72] There are few family law cases that deal with the issue of dismissing an action for delay.

[73] In order to meet the second branch of the test I have to find that the Applicant is responsible for the inexcusable delay and the delay gives rise to a substantial risk that a fair trial might not be possible as a result of the delay: St. Denis v. St. Denis, 2019 ONSC 1091, at para. 10.

[74] In Fakeiry v. Fakeiry, 2012 ONSC 7233, 2012 O.J. No. 6102, (Ont. S.C.J.), Justice McDermot shared his conclusion that the Family Law Rules do not specifically address dismissal of an action for delay. Further r. 24 of the Rules of Civil Procedure is not readily adaptable to family law proceedings, particularly given the wording of r. 24.1(1), which lists circumstances of a plaintiff’s conduct that enables a defendant to have an action dismissed for delay. McDermot J. concluded that the availability of a remedy to dismiss for delay is available to the court in a family law matter as an exercise of its inherent jurisdiction, where to continue a proceeding would be an abuse of process.

[75] A court could also entertain a motion for dismissal for delay in a family law matter as part of r. 2(3), which requires the court to deal with cases justly and consistently, with the court’s duty in r. 2(4) to promote that primary objective. See: Furtney Estate v. Furtney, 2013 ONSC 6687, 235 A.C.W.S. (3d) 667, at para. 80.

[76] Laliberte, J., in Bennett v. Breuers, 2015 ONSC 6540, at para. 55, states that dealing with cases justly includes:

(a) ensuring that the procedure is fair to all parties; (b) saving expense and time; (c) dealing with cases in ways that are appropriate to importance and complexity; and (d) giving appropriate court resources to the case while taking account of the need to give resources to other cases.

[77] In family law cases the jurisdiction to dismiss for delay is often limited to financial claims in respect of property where there has been an unreasonable and unexplained delay which causes prejudice to the moving party. In Fakeiry v. Fakeiry, supra at para. 34, Justice McDermot states:

I am of the opinion that there is jurisdiction in the family law context to strike certain applications if I find that there is an unreasonable and unexplained delay which causes undue prejudice to the moving party. At most, these applications must be for financial claims in respect of property; as discussed below, in the family law context, a request to dismiss for delay is likely not available respecting support claims or custody claims over which a court has an ongoing jurisdiction in considering the best interests of the children or hardship.

[78] The test for dismissing a matter for delay requires balancing the dismissal of an application without the opportunity of the applicant to have his or her day in court as opposed to the prejudice presumed to be suffered from inordinate delay: Fakeiry v. Fakeiry, supra at para. 35.

[79] “Dismissals for delay involve a careful balance between two competing values. On the one hand, the Rules of Civil Procedure need to be enforced in a way that ensures timely and efficient justice, in the interests of the plaintiffs, defendants, and society in general. On the other hand, society in general, and the parties, have an interest in resolution of disputes on their merits and in the availability and flexibility to avoid potential draconian results, by providing the opportunity for parties to offer a reasonable explanation for delay when it takes them beyond the timelines.” See Kara v. Arnold, 2014 ONCA 871, [2014] O.J. No. 5818 at para. 9.

[80] Expeditious justice must be balanced with the public interest in having disputes determined on their merits. Where, despite the delay, the defendant would not be unfairly prejudiced should the matter proceed for resolution on the merits, according the plaintiff an indulgence is generally favoured. See Marchée d’Alimentation Denis Thériault Ltée v. Giant Tiger Stores Ltd., 2007 ONCA 695, at para. 34.

[81] The Applicant quite rightly agrees the delay is excessive. It has been almost 26 years since she started the action. It is clear that the delay has been inordinate.

Has the Applicant rebutted the presumption?

[82] A rebuttable presumption arises where such an inordinate delay has occurred, as the defendants are prejudiced by the substantial risk that a fair trial might not be possible. There are several reasons for the presumption. One recognizes that memories fade over time and another recognizes that justice delayed is justice denied. Expeditious justice is the objective. The presumption strengthens with the length of the delay. See Furtney Estate v. Furtney, supra at para. 61.

[83] The burden of proof is on the Applicant to demonstrate both that there was an acceptable explanation for the delay and that, if the action were allowed to proceed, the Respondent would suffer no non-compensable prejudice. See: Khan v. Sun Life Assurance Co. of Canada, 2011 ONCA 650, 1 C.C.L.I. (5th) 183 (Ont. C.A.), at para. 1; Steil v. Monroe, 2015 BCSC 2122, 2015 CarswellBC 3363 (B.C.S.C.), at para. 57; Kara v. Arnold, 2014 ONCA 871, [2014] O.J. No. 5818.

[84] A determination of the reasons for the delay and assessment of whether those reasons afford an adequate explanation for the delay are required. An inexcusable delay exists if there is no reasonable and cogent excuse for the delay: New Solutions Financial Corp v. Zilkey, 2011 ONSC 448, [2011] O.J. No. 293.

[85] Explanations that are reasonable and cogent, or sensible and persuasive, will excuse the delay, at least to the extent that an order dismissing the action would be inappropriate. See Langenecker v. Sauvé, supra at para. 9.

[86] This exercise involves findings of fact, in part, and exercising judgment in part. See: Khan v. Subhani, 2017 ONSC 246, at para. 94.

[87] The court should consider the issues raised by the case, the complexity of the issues, the explanation for the delay and all relevant surrounding circumstances. In considering whether the defendant has sustained prejudice, the court should consider the availability of witnesses, whether the evidence is largely documentary or based on the recollection of individuals, the efforts by the defendant to preserve its evidence and any other relevant consideration. See Furtney Estate v. Furtney, supra, para. 62.

[88] I am conscious of Justice McDermot’s decision in Fakeiry v. Fakeiry, supra, whereby, at para. 45, it is stated: “Between spouses, it may therefore be inappropriate to impose a presumption of prejudice through inordinate delay as is the case of non-family parties”. Although he does not decide this issue, he examines the moving parties’ conduct, including the husband’s lack of diligence in pursuing his claim and makes a finding that there was no actual prejudice to the husband.

[89] On the evidence, I find that the Applicant has rebutted the presumption of prejudice.

[90] I make that finding because:

(a) The Applicant has provided reasons for the delay that are persuasive; (b) This is not a complicated matter – the issue is very straightforward, and the basic facts are admitted; (c) Both parties were cross-examined shortly after proceedings were commenced, and the transcripts of the cross-examinations can be used as set out in Rule 23 of the Family Law Rules. If either party has failed to comply with undertakings, then the trial judge may choose to draw an adverse inference against that party; (d) The Respondent’s 2018 affidavit is more fulsome as it pertains to the funds, he states were paid to the Applicant to repay the loan, than as described in his 1994 affidavit, such that it is clear his memory has not faded over time; (e) The documentary evidence has been preserved; (f) The Respondent continues to employ the same law firm he retained from the outset (although its composition has changed). Accordingly, his file should be properly preserved; (g) The issue in dispute is one that in essence is personal to the parties – indeed, they are the key witness; (h) The only identified witness who has died is Russell Tambeau. I do not accept that he is a material witness. His sister, as executor, can provide evidence as to what monies may or may not have been owing at the time of his death.

Has the Respondent been able to show actual prejudice?

[91] Given that the presumption is rebutted, the onus shifts to the defendant to lead convincing evidence of actual prejudice.

[92] The Respondent contends that “other witnesses have either passed away or cannot be located.” He has not identified these “other witnesses” and therefore I cannot make a finding with respect to same.

[93] He also states: “Moreover, I am unable to obtain any additional document form (sic) the bank or any other institutions given the passage of time resulting in significant prejudice to my defending the claims made by the Applicant.” There is no evidence before me to indicate that the banking records or other information necessary for the Respondent to prove his payments could not, and were not, obtained from him in or around the time of questioning. He has attached the documentary evidence in support of his contention that the loan was repaid to his affidavits. He has not advised as to what documentary evidence is missing other than the Sears bill.

[94] The Respondent has failed to lead convincing evidence of actual prejudice.

(d) Discharging the Certificate of Pending Litigation (“CPL”)

[95] Had I ordered the action dismissed, the order discharging the CPL would have flowed.

[96] As I have not ordered the action dismissed, the question arises as to whether the CPL should be discharged at this time.

[97] The Respondent asserts that the CPL should be removed from the Port Elgin property “for want of prosecution” and furthermore submits that the Applicant does not have an interest in the land and that at most her relief would be in the form of damages.

[98] The Applicant submits that the CPL should not be discharged as this is her only form of security.

[99] The relevant statutory provision is S. 103(6) of the Courts of Justice Act which provides as follows:

(6) The court may make an order discharging a certificate, (a) where the party at whose instance it was issued, (i) claims a sum of money in place of or as an alternative to the interest in the land claimed, (ii) does not have a reasonable claim to the interest in the land claimed, or (iii) does not prosecute the proceeding with reasonable diligence; (b) where the interests of the party at whose instance it was issued can be adequately protected by another form of security; or (c) on any other ground that is considered just, and the court may, in making the order, impose such terms as to the giving of security or otherwise as the court considers just.

[100] Discharging a Certificate of Pending Litigation (“CPL”) is a discretionary remedy. The onus is on the moving party to satisfy the court that the certificate ought to be discharged. In exercising its discretion, the court must consider its equitable jurisdiction and the issues between the parties to reach a determination. See Sepanary v. Sepanary, 2011 ONSC 3155, 201 A.C.W.S. (3d) 1072.

[101] The test on a motion to discharge a CPL is the same as the test on a motion for leave to issue a CPL. See Peruzza v. Spatone, 2010 ONSC 841, [2010] O.J. No. 493.

[102] The test has two steps:

(i) First, the court must consider whether there is a triable issue as to whether the Applicant has an interest in the subject land. The onus is on the moving party to demonstrate there is no triable issue as to whether the party who has obtained leave to issue the CPL has a reasonable interest in the land claimed: Peruzza, supra at para. 20. (ii) Second, the court is to consider the equities of granting or denying a request that a CPL be discharged.

Is there a triable issue?

[103] The court does not assess the credibility of deponents or decide disputed issues of fact in determining the question of whether to discharge or issue a CPL, but simply determines whether there is a triable issue as to an interest in the land. See HarbourEdge Mortgage Investment Corp. v. Community Trust Co., 2016 ONSC 448, 16 E.T.R. (4th) 124, at para. 45.

[104] It is difficult to see how a dispute claiming a constructive and or resulting trust interest in the Port Elgin property does not give rise to a triable issue as to whether the Applicant has an interest in the land identified as the Port Elgin property. A trust claim need not be strong, only not “devoid of merit”. Albaroudi v. Tarakji, 2013 ONSC 1204 at para. 23.

[105] I am not satisfied that the Respondent has discharged his onus of demonstrating no triable issue with respect to the Applicant’s claim to an interest in the Port Elgin Property particularly in reference to the claim based upon constructive trust in support of unjust enrichment. A claim based on the doctrine of constructive trust in respect of property may give rise to an interest in land. See Roseglen Village for Seniors Inc. v. Doble, 2010 ONSC 3239 (Master) at para. 14.

Consideration of Factors

[106] The governing test is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted or vacated See 931473 Ontario Ltd. v. Coldwell Banker Canada Inc.; Clock Investments Ltd. v. Hardwood Estates Ltd. at para. 9.

[107] Factors have been articulated in statute and in common law.

[108] Section 103(6) of the CJA laid out above provides factors for consideration. Sub-paragraph 103(6)(a) (ii) provides that a CPL can be discharged if the party for whom it was issued has no reasonable claim to the interest in the land. I have already discussed that the Respondent has not met his onus in demonstrating that there is no triable issue. In finding a triable issue, it follows that the Applicant’s constructive trust claim is not devoid of merit and should be subject a disposition at trial. This factor weighs against discharging the CPL.

[109] Sub-paragraph 103(6) (a) (iii) of the CJA provides that one of the factors to be considered is whether the Respondent failed to prosecute her claim to an interest in the land with diligence. I am satisfied that this applies here. Having said that, I have made provision for timelines for the next step and an expedited trial. Given these provisions, the Applicant’s lack of diligence will not support discharging the CPL in this case.

[110] Factors have also been articulated in common law.

[111] Justice Broad in Guz v. Olszowka, 2019 ONSC 5308 (Ont. S.C.J.), discusses the ordering and vacating of a CPL in the context of an estate matter and relies on the decision of Master Glustein (as he then was) in Perruzza v. Spatone, 2010 ONSC 841 (Ont. S.C.J.) in listing the factors the court can consider on a motion to discharge a CPL which include, at para. 27:

(i) whether the plaintiff is a shell corporation, (ii) whether the land is unique, (iii) the intent of the parties in acquiring the land, (iv) whether there is an alternative claim for damages, (v) the ease or difficulty in calculating damages, (vi) whether damages would be a satisfactory remedy, (vii) the presence or absence of a willing purchaser, and (viii) the harm to each party if the CPL is or is not removed with or without security (572383 Ontario Inc. v. Dhunna at paras. 10-18).

[112] Applying those factors to this case, I note (i) the respondent is not a shell corporation; (ii) the land has not been described as unique by either party; (iii) no one disputes that the intention of the parties was that they would jointly occupy the property and provide a home for their then unborn child; (iv) there is no alternative claim for damages but this may well be a case where damages are the appropriate remedy; (v) although neither party addressed the issue of calculating damages, the calculation of damages in this case would not be difficult; (vi) damages would be a satisfactory remedy; (vii) the Applicant raised the issue that the Respondent may be intending to sell the property but the Respondent chose not to respond to that allegation. These factors on balance would favour discharging the CPL.

[113] Not all of these factors would be relevant (the uniqueness of the land is one example) where the claim is based on constructive trust. Justice Broad in Guz at paragraphs 50-51, relying on Roseglen Village for Seniors Inc. v. Doble, noted that most of the factors in Dhunna are more applicable to an action for specific performance of a contract for the purchase and sale of land and not to a claim based upon constructive trust over specific property. This observation in Guz was followed in Vrancor Development Group Inc. v. Juricic, 2019 ONSC 7063 (Master) at para. 14.

[114] The final factor articulated in Dhunna is (viii) the harm to the parties with or without security. The result of that balancing is ultimately determinative. I find that the Applicant would suffer greater harm, particularly because no assurances for alternative security have been provided. While the harm to the Respondent from the delay is addressed by an expedited timeline and the possibility of awarding damages, the lack of fulsome financial information from the parties weigh against discharging the CPL.

[115] I have not been provided with current financial information. The last financial statement each party swore was in 2008. I have not been advised of the value of the land or whether it continues to be encumbered. The Respondent did not offer another form of security. The only party that raised the issue of security is the Applicant who indicated that there is no other form of security available. Accordingly, it is impossible for me to determine whether other security is available. Whether another form of security is available to protect the interests of the Applicant is a consideration provided in s. 103 (6)(b) of the CJA and weighs against the discharge.

[116] Further, the Applicant alleged that the Respondent wished to sell the property - the Respondent did not respond to that allegation. In the absence of clear evidence that a sale is being contemplated, I cannot conclude that the Respondent’s desire to liquidate the property is compromised by the continuing existence of the CPL.

[117] In other words, the harm to the Applicant in vacating the CPL is greater than the harm to the Respondent in declining to do so.

[118] An alternative remedy for the Respondent could be for the court to order the Respondent to pay a predetermined sum or for one half of the proceeds, in the event of the sale of the property, into court. In Guz v. Olszowka, Justice Broad did just this. At para. 54, Justice Broad stated: “An additional important factor is that the defendant is prepared, as exemplified by her cross-motion, to be bound by an order requiring her to pay into court one half of the proceeds of sale of the Patterson Property in the event of its sale prior to final determination of the action. The defendant’s proposal is consistent with the provision in s. 103(6) of the Courts of Justice Act that the court may, in making an order discharging a CPL, impose such terms as to the giving of security or otherwise as it considers just.” I will note that no such proposal has been made by the Respondent in this case. Though the Respondent did not make such a proposal, the court retains jurisdiction to render such an order under s. 103(6)(c). Such an order would clear the path towards vacating the CPL.

[119] However, such an order will not be rendered in this case. The trial of this case will be to determine what, if any, interest the Applicant holds with respect to the Port Elgin property and, if found, the ultimate proportion of that interest. To order that half of the potential proceeds of the property’s sale - which would be the highest possible amount the Applicant could receive in her constructive or resulting trust claim - or some predetermined sum, would be inappropriate, as it would prejudge the merits of this case prior to trial, and perhaps, even cause prejudice to the Respondent.

[120] As a result, I am not prepared to discharge the certificate of pending litigation at this time. This is without prejudice to the Respondent applying in the future with a provision for alternate security should he have need to sell, refinance or otherwise deal with the Port Elgin property.

[121] For the reasons set out above, I make the following orders:

1. The Respondent’s Motion is dismissed without prejudice to his right to bring the issue back for further determination if the Applicant does not move with diligence to set the next stage in these proceedings within three months of the return to regular court operations or the resumption of operations that would allow for the setting of a settlement conference.
2. The Certificate of Pending Litigation issued with respect to the property municipally known as 432 Gustavus Street, Port Elgin, Ontario and registered on October 21, 1994 as Instrument No. R30721 shall remain in place without prejudice to the Respondent applying in the future with a provision for alternate security.
3. In recognition of the notice to the profession of March 24, 2020 as a result of COVID 19, counsel shall attend court on June 9, 2020 at 10:00 a.m. to set a date for a combined settlement conference/trial management conference on the outstanding issues unless such conferences are made available by further Regional Notice to the Profession or Regional Protocol, in which case the parties may request a Settlement Conference by contacting the Trial Coordinator.
4. Upon the resumption of regular court operations, and following the attendance of counsel on June 9, 2020, the trial of this matter shall be expedited.

[122] Unless offers to settle have been exchanged by the parties, the costs of this motion are reserved to the trial judge. If offers to settle have been served by either party, and the parties are unable to resolve the matter of costs then the party seeking costs shall serve and provide to the court written submissions (not to exceed 4 pages in length), relevant case-law, a detailed Bill of Costs and copies of any Offers to Settle, within 21 days. Any responding submissions shall be served and provided to the court 14 days thereafter. Reply submissions shall be served and provided to the court 7 days thereafter. There shall be no extensions to these deadlines. As a result of COVID-19, these submissions are to be directed to the following legal assistants: Mona.Goodwin@ontario.ca and Lori.Rebelo@ontario.ca as well as Kitchener.Superior.Court@ontario.ca. It is imperative that counsel indicate in the subject line that these are costs submissions, and for which judge they are intended. When normal court operations resume the parties shall ensure their costs submissions are filed.

D. Piccoli J

DATE: April 22, 2020