COURT FILE NO.: 78/20 (St. Catharines)
DATE: 20201110
ONTARIO
SUPERIOR COURT OF JUSTICE – FAMILY COURT
BETWEEN:
lisa ann smith
Applicant
– and –
KEVIN REGINALD SMITH
Respondent
Monica Scholz, for the Applicant
Lydia Moritz, for the Respondent.
HEARD: October 23, 2020, by video conference
R. A. Lococo J.
REASONS FOR decision
I. Introduction
[1] Lisa Smith and Kevin Smith separated in June 2019, after 39 years of marriage. They both continue to reside in their jointly-held former matrimonial home in Grimsby, living separate and apart within the residence. Lisa’s 82-year-old mother also resides in the residence, as she has since 2003, after her husband’s passing. The parties have three adult children, who are independent and live elsewhere.
[2] The former matrimonial home also includes the business office for Naturally Gas Ltd. (“NGL”), the jointly-owned family business the parties have operated for over 30 years. NGL has no personnel other than Kevin and Lisa.
[3] Kevin installs and services gas furnaces, air conditioners, stoves and dryers. He is also responsible for sales and invoicing customers. Cash revenue is also generated from scrap metal when Kevin replaces furnaces and air conditioning units. Kevin generally works long hours Monday through Thursday servicing customers. He then spends the weekend at the parties’ jointly-owned cottage near Parry Sound, while Lisa remains in the former matrimonial home with her mother.
[4] In addition to household tasks, Lisa is responsible for the administrative and bookkeeping aspects of NGL’s business, working from the home office in Grimsby. Since the parties’ separation, she has continued to input revenue and expenses into NGL’s bookkeeping system from invoices and expense receipts Kevin provides to her.
[5] Both before and after separation, Lisa and Kevin each receive a monthly (equal) dividend payment from NGL. Prior to separation, those payments were deposited into their joint bank account and (together with cash from scrap metal) used to pay household and other living expenses. Shortly after separation, Lisa’s lawyer wrote to Kevin, requesting that the parties convert their joint bank accounts to “two to sign” accounts and otherwise maintain the financial status quo until a separation agreement could be negotiated. Without responding, Kevin promptly withdrew the funds from their main personal joint bank account, terminated Lisa’s access to his credit card, and opened new personal and business accounts to which he alone has access. However, except for the monthly Cogeco bill (which Lisa pays), Kevin continues to pay all other expenses, including the mortgage, line of credit, property taxes, home insurance, and all other utilities. As well, after separation, Kevin also took over use of the personal vehicle Lisa had been driving (a 2012 Volkswagen Passat registered in Kevin’s name), leaving her dependent on use of her mother’s car. He also terminated the lease on the vehicle he had been driving, paying a $10,000 penalty to do so.
[6] With that background, the parties bring three motions for interim relief. In each case, the responding party resists the relief claimed, except as indicated below. In summary, the parties seek the following:
a. Exclusive possession: Lisa seeks exclusive possession of the matrimonial home.
b. Sale of jointly-held real property: Kevin seeks an order for the sale of the matrimonial home. Lisa does not agree, but if a sale is ordered, she seeks an order for the sale of the parties’ jointly-owned cottage. Kevin has no objection to an order for the cottage’s sale if the matrimonial home is ordered sold.
c. Non-depletion/restoring financial status quo: Lisa seeks an order restraining Kevin from depleting assets and otherwise requiring Kevin to restore the financial status quo at the date of separation.
d. Disclosure: Lisa seeks an order requiring Kevin to provide personal and NGL financial records from the date of separation. Kevin has no objection to providing records that would normally be disclosed in this context. He also requests that any disclosure order be mutual.
e. Lisa’s Reply: Lisa seeks leave for the late filing of her Reply (served March 26, 2020) within seven days. Kevin consents.
[7] On consent, leave is granted to Lisa for the late filing of her Reply within seven days. The other matters listed above are addressed in turn in the balance of these reasons.
II. Exclusive possession
[8] Lisa seeks exclusive possession of the matrimonial home. Among other things, Lisa argues that Kevin’s continued presence endangers her health and well being and that of her mother. Kevin disputes the factual basis for Lisa’s position, arguing that both parties should continue to occupy the premises pending its sale pursuant to court order.
[9] Both spouses have an equal right to possession of a matrimonial home upon breakdown of the marriage: see Family Law Act, R.S.O. 1990, c. F.3, s. 19(1). The court may nonetheless make a temporary order under s. 24(2), granting exclusive possession of the matrimonial home (or part of it) to one spouse and ordering a spouse to pay associated expenses. In determining whether to make such an order, the court is directed by s. 24(3) to consider the following:
a. the best interests of any affected children;
b. any existing orders relating to family property or support, and other enforceable support obligations;
c. the financial position of both spouses;
d. any written agreement between the parties;
e. the availability of other suitable and affordable accommodation; and
f. any violence committed by a spouse against the other spouse or the children.
[10] The considerations in paragraphs (a) and (d) above do not apply in this case, since there is no written agreement between the parties and no affected children entitled to support. With respect to paragraph (b), there are no existing family property or support orders, but Kevin agrees that but for the continuing flow of funds from NGL to Lisa, she would be entitled to spousal support.
[11] Lisa argues that Kevin’s continued presence in the matrimonial home endangers the health and well being of Lisa and her mother, who are particularly vulnerable to the effects of the COVID-19 virus. As previously noted, Kevin spends his working days making service calls at third party premises. Lisa says that she has never seen Kevin wear a mask or gloves or otherwise follow COVID-19 safety protocols. She also says that Kevin has never provided her with receipts for the purchase of personal protective equipment for entry into NGL’s bookkeeping system, and notes that no such receipts have been produced in response to her motion.
[12] Lisa also says that she and her mother have no alternative accommodations, and that Kevin is better placed financially to secure accommodations elsewhere. She also alleges that Kevin’s behaviour following the separation (limiting her access to financial resources and his alleged disruptive behaviour in the matrimonial home, as well as his alleged longstanding alcoholism) are sufficient to constitute “violence” against her within the meaning of s. 24(3)(f), which would militate in favour of granting her exclusive possession. Her counsel relies on Hill v. Hill (1987), 1987 CanLII 8348 (ON SC), 10 R.F.L. (3d) 225 (Ont. Dist. Ct.), at para. 25, where the court found that in the absence of physical abuse, “violence” in this context “includes psychological assault upon the sensibilities of the other spouse to a degree which renders continued sharing of the matrimonial dwelling impractical.”
[13] Kevin disputes Lisa’s allegations, stating that that he complies with prescribed safety protocols, as he is required to do by the nature of his business. Kevin does not dispute that when Lisa communicated her intention to separate after 39 years of marriage, he initially acted defensively and inappropriately. However, he denies that his behaviour can be construed as constituting violence against Lisa. He also denies any conduct endangering Lisa’s mother, who has resided with the parties (with his willing concurrence) since 2003 without significant financial contribution and to whom he owes no support obligation. He also denies that Lisa has been financially disadvantaged, noting that he continues to pay household and other expenses, while Lisa continues to receive the same payments from NGL that she received before separation and has not been deprived of any financial assets.
[14] The application of the criteria set out in s. 24(3) of the Family Law Act has been more recently considered by McGee J. of this court in Menchella v. Menchella, 2012 ONSC 1861. In that case, at paras. 16, the court describes the legislative intent of this provision as follows:
The legislature clearly intended spouses and their children to be able to maintain the shelter and consistency afforded by a matrimonial home while the issues arising from a marriage breakdown are determined…. The statutory exception to continued possession of a home arises primarily in circumstances in which continued joint occupation is a potential or real threat to the safety or wellbeing of a child or a spouse.
[15] At para. 15, the court also advises caution in making an exclusive possession order based on conflicting evidence, as follows:
An order for exclusive possession is dramatic in effect, and highly prejudicial to the dispossessed spouse. An order for exclusive possession should not be made on a motion where there is conflicting evidence that requires findings of credibility that are only available at trial.
[16] Consistent with the approach taken in Menchella, I am not satisfied that Lisa has met the statutory criteria for an order for exclusive possession of the matrimonial home.
[17] There is conflicting evidence relating to the extent of any threat to Lisa’s well-being as a result of Kevin’s continued presence in the matrimonial home, including in relation to any heightened risks arising in the context of the COVID-19 pandemic. I find some of Lisa’s allegations Lisa troubling on their face, but in the context of heavily contested family law litigation, where feelings run high, the courts must be careful about depriving a party of property and other rights based on the party’s alleged failure to disprove overblown, self-serving allegations by the other party. That is particularly the case in interim proceedings, where the evidence is not tested to the extent it would in the trial context.
[18] In this case, I am not satisfied that the evidence establishes “violence” against Lisa within the meaning of s. 24(3)(f) of the Family Law Act. In that regard, I consider the decision in Hill v. Hill to be distinguishable on its facts, given (among other things) the relentless nature of the offending spouse’s conduct that the court found to be present in that case.
[19] As well, as discussed further later in these Reasons, there is no cogent evidence that Lisa has been financially disadvantaged to date by Kevin’s actions. Among other things, Lisa relies on the fact that after separation, Kevin transferred $50,000 from NGL’s operating account to its managed investment account, without consulting Lisa (as he would have prior to separation). However, based on the evidence Kevin has provided, I am satisfied that transferring excess operating funds to NGL’s investment account was consistent with previous practice, contributing to the “nest egg” within NGL that is held for the ultimate benefit of both parties. There is no evidence to suggest that Kevin has appropriated those funds for his own use.
[20] Accordingly, I am dismissing Lisa’s request for exclusive possession of the matrimonial home.
III. Sale of jointly-held real property
[21] Kevin seeks an order for the sale of the matrimonial home. Lisa does not agree, but if the sale is ordered, she seeks an order for the sale of the parties’ jointly-owned cottage. Kevin has no objection to an order for the cottage’s sale if the matrimonial home is ordered sold.
A. Legal principles
[22] Under s. 10(1) of the Family Law Act, a person may apply to the court to determine a question between spouses as to a property’s ownership or possession. The court may (among other things) order the property to be partitioned and sold: see Family Law Act, s. 10(1)(c). As well, under s. 3(1) of the Partition Act, R.S.O. 1990, c. P.4, a person interested in land may make an application for the land’s partition and sale in order to enforce the person’s rights under s. 2 of that Act.
[23] In Marchese v Marchese, 2017 ONSC 6815, at para. 18, Faieta J. considered the criteria for determining whether a matrimonial home should be ordered sold, as follows:
The determination of whether a matrimonial home should be ordered to be sold is governed by the [Partition] Act, R.S.O. 1990, c. P.4 and the principles articulated by the Ontario Divisional Court in Kaphalakos v. Dayal, 2016 ONSC 3559, at paras. 16-17:
(a) a joint tenant has a prima facie right to an order for the partition or sale of lands held with another joint tenant;
(b) a court is required to compel partition and sale unless the opposing party has demonstrated that such an order should not be made;
(c) the party opposing the sale must show malicious, vexatious or oppressive conduct to avoid the order; and
(d) the malicious, vexatious or oppressive conduct must relate to the partition and sale issue itself and not to the general conduct of the person bringing the motion.
[24] While the circumstances in which the court may refuse to compel partition and sale are limited, the Court of Appeal in Greenbanktree Power Corp. v. Coinamatic Canada Inc. (2004), 2004 CanLII 48652 (ON CA), 75 O.R. (3d) 478 (C.A.), at para. 2, provided the following caveat, relating to the circumstances in which the conduct of the moving party may be considered oppressive:
In our view, "oppression" properly includes hardship, and a judge can refuse partition and sale because hardship to the co-tenant resisting the application would be of such a nature as to amount to oppression.
[25] In Kaphalakos, at paras. 31-33, the Divisional Court, relying on Greenbanktree, found that bringing a motion for the partition and sale of the co-tenants’ jointly-owned property was capable of being oppressive in circumstances in which there is evidence that the opposing co-tenant is physically and mentally impaired and has no place else to live. In Kaphalakos, the opposing co-tenant was critically injured following an attack with a hammer by the moving party.
[26] In Silva v. Silva (1990), 1990 CanLII 6718 (ON CA), 1 O.R. (3d) 436 (C.A.), the Court of Appeal indicated a further potential limitation on the circumstances in which an interim order for partition and sale of jointly-owned spousal property can be denied. In Silva, at p.445, the court considered whether “the F.L.A. [Family Law Act] ousts the jurisdiction of the [Partition Act] when dealing with jointly owned spousal property.” The court answered in the negative, with the following caveat:
The two statutes are not incompatible, but where substantial rights in relation to jointly owned property are likely to be jeopardized by an order for partition and sale, an application under the [Partition Act] should be deferred until the matter is decided under the F.L.A. Putting it more broadly, an application under s. 2 should not proceed where it can be shown that it would prejudice the rights of either spouse under the F.L.A.
B. Position of the parties
[27] In their pleadings, both parties are seeking a final order for the equalization and division of their net family property, which the pleadings recognize will involve the sale of jointly-owned assets. In financial terms, the most significant of those assets are the matrimonial home, the cottage, and the investment portfolio held within NGL. According to Kevin’s Work in Progress Net Family Property Statement dated September 21, 2020, the matrimonial home is valued at $780,000 (which Lisa disputes as too high), the cottage at $275,000 (also disputed), and the NGL investment account at $334,198. Kevin’s net family property statement also indicates a joint home mortgage of $56,533 and a joint line of credit balance of $32,907.
[28] In support of his request that the matrimonial home be listed for sale, Kevin says that in order to equalize and divide the parties’ net family property, it will be necessary to sell the matrimonial home. With appropriate financial and tax advice, it will also be necessary to wind up NGL and divide its assets. According to Kevin, doing so will allow him to establish a successor business that will permit him to pay spousal support to Lisa, which he acknowledges would be payable going forward.
[29] Lisa disagrees. Her principal argument against an interim order requiring the matrimonial home’s partition and sale is that it will prejudice her rights to property and support under the Family Law Act. In particular, she argues that an interim order requiring the partition and sale of a jointly-owned matrimonial home should not be made if the resisting spouse has an arguable case for (i) exclusive possession, or (ii) an order vesting the property into her name alone in respect of her claim for equalization or spousal support. She relies on Binkley v. Binkley (1988), 1988 CanLII 8717 (ON CA), 14 R.F.L. (3d) 336 (Ont. C.A.) and Harewood v. Harewood (1993), 1993 CanLII 16130 (ON CA), 45 R.F.L. (3d) 449 (Ont. C.A.). In support of her position, She also relies on the strong attachment that Lisa and the parties’ adult children have to the matrimonial home, in contrast to Kevin’s professed attachment to the cottage. Kevin contests Lisa’s suggestion that her attachment to the matrimonial home is any more significant than his.
C. Analysis and conclusion
[30] As explained below, I have concluded that an order should issue requiring the matrimonial home to be listed for sale and sold.
[31] Addressing first the question of attachment to the matrimonial home, the termination of a longstanding spousal relationship (and the consequent division of assets) is inherently disruptive for both parties. The court is required to address the economic and human consequences of separation to the extent it can, within the scope of its jurisdiction. When doing so in this case, I do not consider the parties’ relative attachment to the matrimonial home to be a significant factor when determining whether sale of the property should be ordered. Moreover, the views of the parties’ adult children (as set out in their affidavits), if anything, carry even less weight, given that they have no claim to a property interest and no right to support.
[32] In all the circumstances, I see no reasonable basis for concluding that requiring partition and sale at this time will prejudice Lisa’s rights to property and support under the Family Law Act.
[33] As noted above, relying on the Court of Appeal decisions in Binkley and Harewood, Lisa argues that an interim order requiring the partition and sale of a jointly-owned matrimonial home should not be made if the resisting spouse has an arguable case for (i) exclusive possession, or (ii) an order vesting the property into her name alone in respect of her claim for equalization or spousal support. The case reports for both those decisions are brief endorsements, with little or no factual context. In Binkley, the Court of Appeal set aside an order for immediate sale of the matrimonial home. The appellant wife, who occupied the residence, claimed an unequal division of assets and vesting of the home in her name alone. The court found that the appellant wife had “at least an arguable case”, with the result that an order for sale “would substantially impair, if not destroy, the wife’s right to a trial of the most substantial property issue.” In Harewood, the court also set aside an order for immediate sale of the matrimonial home and granted interim exclusive possession to the appellant wife. Relying on Binkley, the court did so “[i]n view of the conflicting evidence … and the appellant wife’s claim for possession,” without further elaboration.
[34] The decisions in Binkley and Harewood are consistent with the Court of Appeal’s pronouncement in Silva (at p. 445) that partition and sale should not proceed where it can be shown that it would prejudice the rights of either spouse under the Family Law Act.[^1] However, because of the lack of factual context, Binkley and Harewood do not provide any effective guidance as to the principle’s application. At most, those cases support Lisa’s position that an interim order for partition and sale should not be made were the resisting spouse has an arguable case for exclusive possession or for an order vesting the property into her name alone in respect of her claim for equalization or spousal support. However, on the evidence before me on this motion, Lisa has not demonstrated that there is an arguable case for that relief.
[35] In her application, Lisa requests an order for equalization and division of net family property, as well as an order that the parties’ jointly-owned properties be listed for sale and sold. Unlike the appellant wife in Binkley, Lisa’s application does not include a claim for an unequal division of net family property, nor does the evidence on this motion indicate any reasonable basis for making such an order. In her application, Lisa also requests an order for exclusive possession of the matrimonial home pending its sale. I have already found that Lisa has not demonstrated her entitlement to an interim order for exclusive possession. As well, I agree with Kevin’s counsel that the evidence does not provide any reasonable basis for concluding that equalization of net family property can be achieved without the sale of the parties’ most significant asset, the matrimonial home.
[36] In all the circumstances, I see also no reasonable basis for concluding that Lisa would be successful in obtaining an order vesting the matrimonial home in her name in respect of her claim for equalization or spousal support. According to Lisa’s counsel, there is an arguable case for making such an order, given (i) the likelihood that Kevin will be required to make a significant equalization payment and significant spousal support payments to Lisa, and (ii) the allegation that Kevin has already acted to Lisa’s financial disadvantage in the steps he has taken with respect to the parties’ joint assets since the parties’ separation.
[37] The evidence does not support those submissions. While the evidence indicates that Kevin will ultimately be required to make an equalization payment to Lisa, it also suggests that the parties’ financial positions are in fact fairly similar. Once the matrimonial home is sold, the evidence does not suggest there is any likelihood that Kevin will be unable to make the required equalization payment to Lisa. As well, once NGL’s assets have been divided between the parties and a successor business established, the evidence does not suggest that Kevin (who with Lisa has operated a successful business for over 30 years) would be unable to pay spousal support to Lisa on an ongoing basis.
[38] As well, as I have previously indicated, the evidence does not support the conclusion that Lisa has been financially disadvantaged since the parties’ separation. Lisa continues to receive regular dividend payments from NGL equivalent to what she received prior to separation. Kevin continues to pay the household and other expenses that were previously paid in cash or from the parties’ joint funds. As well, as already stated, there is no evidence that Kevin has appropriated NGL funds for his personal use, as Lisa suggests.
[39] Applying the criteria set out in Marchese and Kaphalakos, I am satisfied that an order should issue requiring that the matrimonial home be listed for sale and sold. In reaching that conclusion, I considered whether Kevin’s bringing the partition and sale motion constituted “malicious, vexatious or oppressive conduct”. On the evidence, I have concluded that it did not. Kevin brought the partition and sale motion to be considered concurrently with Lisa’s pre-existing motion for interim exclusive possession. Given Kevin’s prima facie entitlement to partition and sale, there is no basis for concluding that his partition and sale motion was vexatious, nor does the evidence suggest that his conduct in bringing the motion was malicious or oppressive.
[40] In determining that Kevin’s conduct was not oppressive, I also considered whether an order listing the matrimonial home for sale would result in “hardship” to Lisa that would justify refusing to make an interim order for partition and sale. I have concluded that the evidence does not support the view that Lisa would suffer hardship amounting to oppression. Each of the parties seeks equalization and division of net family property. As I have already indicated, I see no reasonable basis for doing so without sale of the matrimonial home. As well, unlike in Kaphalakos, the evidence does not support the conclusion that Lisa would be physically or financially unable to find alternative accommodations.
[41] Accordingly, I have concluded that an order should issue that the matrimonial home to be listed for sale and sold and requiring the parties to cooperate in the listing and sale. In order to settle the means of doing so, I suggest that the parties consider as a starting point the terms set out in para. 88 of Lisa’s affidavit sworn October 8, 2020. If necessary, either party may bring a further motion for directions relating to the property’s listing and sale.
[42] In response to Kevin’s motion for partition and sale, Lisa brought a cross motion requesting that if the court ordered sale of the matrimonial home, an order should also issue for the sale of their jointly-owned cottage. There was initially some discussion about whether the cross motion was properly returnable for a hearing at the same time as Kevin’s partition and sale motion, but the parties ultimately agreed that I should hear the motions concurrently.
[43] In response to Lisa’s cross motion, Kevin’s counsel indicated during oral submissions that Kevin has no objection to an order for sale of the cottage if the matrimonial home is ordered sold. Applying the rationale set out above in favour of sale of the matrimonial home, I agree that an order for sale of the cottage should also be made.
IV. Non-depletion/restoring financial status quo
[44] Lisa also seeks an order restraining Kevin from depleting his assets and otherwise requiring Kevin to restore the financial status quo at the date of separation.
[45] In connection with Lisa’s claim for equalization of net family property, if the court considers it necessary for the protection of Lisa’s interests, the court may make an interim or final order restraining the depletion of property or otherwise requiring the property’s preservation: see Family Law Act, s. 12. As well, the court may make an interim or final order, restraining the depletion of a spouse’s property that would impair or defeat a claim for spousal support: see Family Law Act, s. 40.
[46] For a non-depletion or preservation order to be granted, the court must be satisfied that there is a prima facie case that the order is necessary to protect the moving party’s interests: see Taus v. Harry, 2016 ONSC 219, at para. 30, cited in Fatahi-Ghandehari v. Wilson, 2016 ONSC 6863, at para. 53. The burden is on the moving party to demonstrate that a prima facie case has been made out.
[47] Lisa argues that a non-depletion order is necessary in this case in order to ensure that Kevin does not dissipate assets to avoid his obligation to pay spousal support or make an equalization payment to Lisa. In order to support Lisa’s position that there is a legitimate concern about dissipation of assets, among other things, Lisa’s counsel referred to the movement of funds from NGL’s operating account to NGL’s investment account as well as the $10,000 payment to break the lease on Kevin’s leased vehicle shortly after separation. Kevin’s explanation for breaking the vehicle lease was that given the expected financial implications of the parties’ separation, he decided to return the vehicle to the leasing company to avoid the ongoing payments that would be required to retain the vehicle. He acknowledged, however, that he had not factored in the required payment to break the lease. With the return of that vehicle, he took over the 2012 Volkswagen Passat previously driven by Lisa, whom he believed was not disadvantaged since she had access to her mother’s vehicle.
[48] On the evidence before me, I have concluded that Lisa has not demonstrated that a non-depletion or preservation order should issue in this case, other than as indicated below with respect to the payment of expenses relating to the matrimonial home.
[49] In all the circumstances, I do not consider Kevin’s breaking of the vehicle lease to be a material consideration in determining whether there will be sufficient funds to honour his equalization or support obligation. I see no other cogent evidence that indicates that he is likely to dissipate assets to avoid his obligation to pay support or make an equalization payment to Lisa. As stated above, I am not persuaded that there was anything nefarious about the movement of funds from NGL’s operating account to its investment portfolio or that Lisa was financially disadvantaged by that transfer.
[50] Accordingly, Lisa’s request for a non-depletion or preservation order is dismissed, except in one limited respect. In order to preserve both parties’ interests in the matrimonial home and consistent with Kevin’s spousal support obligation to Lisa, the order will require Kevin to continue to pay all expenses associated with the matrimonial home, except the Cogeco bill, which will remain Lisa’s responsibility.
[51] In addition to Lisa’s request for a non-depletion order, she also asks that Kevin be required to restore to the financial status quo prior to separation. In particular, she seeks reinstatement of her access to NGL’s business bank account and NGL’s and Kevin’s credit cards, as well as return of the 2012 Volkswagen Passat for her use. She also requests direct access to NGL’s suppliers, customers, telephone, email and mail, which she says Kevin has denied her since the separation.
[52] Kevin disagrees that any such order should be made. He alleges, among other things, that Lisa contacted NGL’s customers after separation with inappropriate questions about his activities, resulting in discomfort to those being contacted, potentially causing business loss. Lisa denies doing so, alleging that the customers were being contacted by a third party (initiated by Kevin) for testimonials for NGL’s website. (I find it unnecessary to make any findings relating to these competing allegations about contacting NGL’s customers). Kevin also notes that there were in fact no NGL credit cards. Credit card purchases for NGL were charged to Kevin’s personal credit card (Lisa being a secondary cardholder prior to separation) and then paid or reimbursed with NGL funds.
[53] I am not satisfied that a further order should be made of the nature Lisa requests. Kevin does not dispute that he acted precipitously and inappropriately after the separation with respect to (among other things) access to NGL’s bank accounts but indicates that his loss of trust in Lisa following their unexpected separation led him to act as he did. Lisa’s counsel argued that the court should not be seen to be condoning Kevin’s inappropriate behaviour post separation and I sympathize with that submission. However, well over a year has passed since the separation. Changes in the parties’ financial arrangements after separation are not out of the ordinary. In all the circumstances, I agree with Kevin’s counsel that it would not be appropriate to turn back the clock as if the separation had not occurred.
[54] Effectively, the parties are in a holding pattern while the court proceedings move forward. They continue to reside in the same residence. Lisa continues to receive the dividend payments she previously received from NGL. Apart from the Cogeco bill, Kevin pays household or other expenses. Lisa continues to provide data entry and bookkeeping services for NGL, based on the information and records Kevin provides. While these arrangements cannot reasonably be expected to continue once equalization and division of assets has occurred, I see no sufficient reason to interfere with the current status quo before determination of the current court proceedings by trial or settlement.
[55] Accordingly, I am dismissing Lisa’s request to restore the financial status quo the existed at the time of the parties’ separation.
VI. Disclosure
[56] Lisa seeks an order requiring Kevin to provide her with personal and NGL financial records from the date of separation. Kevin has no objection to providing records that would normally be disclosed in this context. He also requests that any disclosure order be mutual.
[57] I agree that a disclosure order should be made of the nature the parties request. In doing so, I note that the parties’ ongoing disclosure obligation is legislatively mandated and not dependent on court order: see Family Law Rules, O. Reg 114/99, r. 19.
[58] The order set out below requires Kevin to provide Lisa with the records referred to in paras. 70 and 72 of Kevin’s factum. I consider the scope of that disclosure to be more in keeping with usual practice than the more expansive disclosure that Lisa suggests in her factum. The order also requires Lisa to provide Kevin with the records (or computer access to the records) set out in paras. 71 and 73 of Kevin’s factum. I also recognize that providing the ordered disclosure may well give rise to further disclosure requests consistent with the parties’ ongoing disclosure obligation.
VII. Disposition
[59] Accordingly, a temporary order will issue as follows:
a. On consent, Lisa has leave for the late filing of her Reply within seven days.
b. Lisa’s request for interim exclusive possession of the matrimonial home is dismissed.
c. The matrimonial home and the cottage shall be listed for sale and sold. The parties shall cooperate in the listing and sale. Either party may bring a further motion for directions relating to the properties’ listing and sale, to the extent required.
d. Lisa’s request for a non-depletion or preservation order and for an order restoring the financial status quo prior to separation is dismissed, with the exception that Kevin shall continue to pay all expenses associated with the matrimonial home, expect for the Cogeco bill, which shall remain Lisa’s responsibility.
e. Within 30 days, (i) Kevin shall provide Lisa with the records set out in paras. 70 and 72 of Kevin’s factum, and (i) Lisa shall provide Kevin with the records (or computer access to the records) set out in paras. 71 and 73 of Kevin’s factum.
f. Unless settled by the parties, the issue of costs will be determined following written submissions.
[60] A settlement conference has been previously scheduled for November 24, 2020. The parties may wish to consider settlement of the costs of these motions in that context (if not before).
[61] If the parties cannot agree on costs, the Respondent may serve and file brief written submissions (not to exceed three pages) together with a costs outline within 21 days. The Applicant may respond by brief written submissions together with a costs outline within 14 days. Costs submissions are to be forwarded to the Trial Coordinator, with a copy to me, at 59 Church Street, St. Catharines ON L2R 7N8. If no submissions are received within the specified timeframe, the parties shall be deemed to have settled costs.
The Honourable Mr. Justice R. A. Lococo
Released: November 10, 2020.
COURT FILE NO.: 78/20 (St. Catharines)
DATE: 20201110
ONTARIO
SUPERIOR COURT OF JUSTICE –
FAMILY COURT
BETWEEN:
lisa ann smith
Applicant
– and –
kevin reginald smith
Respondent
REASONS FOR decision
R. A. LOCOCO J.
Released: November 10, 2020
[^1]: In Silva, at p. 445 the court in fact refers to Binkley to support its analysis.