COURT FILE NO.: FS-15-83320
DATE: 20211112
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Sara Fatahi-Ghandehari
Self-Represented, assisted by S. Siddiqui
Applicant
- and -
Stewart Wilson
P. Robson for the Respondent
Respondent
R. Watson for the Braidmore parties
(Not appearing on this motion)
HEARD: September 8, 2021
REASONS FOR DECISION
LEMAY J
[1] I am case managing a series of actions between these parties and some related parties. In reasons released in May of this year, I provided a judgment on Ms. Fatahi-Ghandehari’s undefended trial (see 2021 ONSC 3547). I also provided the parties with further directions in reasons issued on May 26th, 2021 (2021 ONSC 3708) and on June 15th, 2021 (2021 ONSC 4311). These additional decisions addressed some issues and set out further steps to move this litigation forward.
[2] One of the key issues that has to be determined is whether I should stay Mr. Wilson’s actions and/or dismiss his claims against Ms. Fatahi-Ghandehari as a result of Mr. Wilson’s longstanding failure to pay a series of costs awards that have been made against him. Those costs awards have been ordered over a period of more than four years and are in excess of $150,000.00 in total.
[3] In my June 15th, 2021 reasons, I rejected Ms. Fatahi-Gandehari’s position that I should simply stay Mr. Wilson’s actions under Rule 60.12. Instead, I determined that I needed a proper motion record on this issue. I set a timetable for the exchange of materials and set a hearing on this motion for September 8th, 2021.
[4] Ms. Fatahi-Ghandehari argues that Mr. Wilson’s failure to pay the costs award is a deliberate and contumelious failure to follow Court orders. Ms. Fatahi-Ghandehari also argues that Mr. Wilson has been engaged in a series of abuses of process since this litigation commenced. As a result, Ms. Fatahi-Ghandehari argues that Mr. Wilson’s claims should be stayed and his pleadings in actions where he is defending should be struck out.
[5] Mr. Wilson argues that he should not be required to pay the costs that have been awarded to Ms. Fatahi-Ghandehari. He advances this position on the basis that Ms. Fatahi-Ghandehari has engaged in fraud on the Court by, inter alia, claiming that she received an inheritance from her father. As a result, Mr. Wilson is willing to pay the costs into Court but is not willing to pay them to Ms. Fatahi-Ghandehari or her lawyer.
[6] For the reasons that follow, Mr Wilson has fourteen (14) calendar days from today’s date (being November 26th, 2021 at 4:00 p.m.) to pay Ms. Fatahi-Ghandehari’s representative, Mr. Siddiqui, the outstanding costs of $153,368.98. This payment is to be made by certified cheque or money order and must be received by Mr. Siddiqui by 4:00 p.m. on November 26th, 2021. That money is to be disposed of as determined by Ms. Fatahi-Ghandehari and Mr. Siddiqui without further input in any way from Mr. Wilson or his counsel.
[7] In the event that Mr. Wilson does not make these payments directly to Ms. Fatahi-Ghandehari’s counsel, his actions against Ms. Fatahi-Ghandehari will be permanently stayed and his Statements of Defence will be struck out. Ms. Fatahi-Ghandehari’s claims against Mr. Wilson will then be addressed by way of a summary judgment motion that Mr. Wilson will not be permitted to participate in.
Background Facts
a) The History of This Action
[8] There have been a series of motions in this case, and the history of the action is detailed and complex. I will set out the parts of that history that are most relevant to the decision I have to make on this motion.
[9] Ms. Fatahi-Ghandehari and Mr. Wilson met in 2005 and got married on August 12th, 2007. They separated on December 4th, 2014. The parties cohabited for a period of eight (8) years.
[10] During the parties’ relationship, Mr. Wilson ran a business renting exotic cars. Ms. Fatahi-Ghandehari worked with Mr. Wilson in that business. The corporate structure for that business had some complications that need not be explained on this motion. It should be noted, however, that Mr. Wilson made an assignment into bankruptcy at some point in 2009.
[11] Shortly after the parties separated, a civil proceeding was commenced by Mr. Wilson for the return of a series of exotic cars. By way of a decision dated March 3rd, 2015, Gray J. found that the cars being leased by the business were owned by Mr. Wilson and directed that they be turned over to him. The Court of Appeal dismissed Ms. Fatahi-Ghandehari’s appeal of Gray J.’s decision approximately a year later.
[12] Shortly after this Order was made, Mr. Wilson’s Trustee in Bankruptcy secured an Order requiring the cars to be turned over to the trustee in bankruptcy. That Order was also appealed to the Court of Appeal by Mr. Wilson and that appeal was dismissed.
[13] This complicated business history relates to the family law litigation as the assets have been found to be a part of the matrimonial property. Mr. Wilson did not deliver his pleadings in the family law proceeding in a timely way. As a result, on July 23rd, 2015, Miller J. made an Order requiring Mr. Wilson to deliver his answer and financial statement and produce certain bank statements within forty-five days. This order was not complied with.
[14] In 2016, Ms. Fatahi-Ghandehari initiated contempt proceedings against Mr. Wilson. This motion led to an appearance before Price J. in July of 2016. At that time, a series of production orders were made. Some of these orders were made on consent. The family litigation proceeded before Price J. and resulted in a number of decisions.
[15] Ultimately, Mr. Wilson was found in contempt on October 10th, 2017 after seven days of hearing. A sentencing hearing was held in 2018 and led to a decision of Price J. on September 21st, 2018 in which Price J. struck Mr. Wilson’s pleadings and prohibited him from participating in the family law litigation. There were efforts at appeal that I described in my reasons of May 19th, 2021 (2021 ONSC 3547) at paragraphs 22 to 24. Ultimately the decision on contempt and on the sentence flowing from that contempt cannot now be challenged.
b) The Costs Orders
[16] All of the proceedings before Price J. resulted in a series of costs orders. Those costs orders are as follows:
a) $5,000.00 ordered on July 7th, 2016;
b) $94,439.75 plus 2% interest ordered on January 26th, 2018 (see 2018 ONSC 669). By my calculations, the interest at this point on this costs order is $7,082.98;
c) $32,346.25 on September 21st, 2018 (see 2018 ONSC 5579).
[17] In addition to these Orders, Mr. Wilson appealed various matters to the Court of Appeal. There are outstanding costs orders in favour of Ms. Fatahi-Ghandehari from the Court of Appeal as follows:
a) $1,000.00 ordered by a panel of the Court of Appeal on September 4th, 2018 (see 2018 ONCA 728).
b) $5,000.00 ordered by Miller J.A. on January 11th, 2019 (see 2019 CanLII 1036).
c) $2,000.00 ordered by Nordheimer J.A. on March 6th, 2019.
d) $2,500.00 ordered by a panel of the Court of Appeal on March 26th, 2019.
e) $2,500.00 ordered by a panel of the Court of Appeal on June 17th, 2019 (see 2019 ONCA 532).
[18] Finally, shortly after releasing his final decision in this matter, Price J. elected supernumerary status. Daley R.S.J. became the case management judge. At that point, counsel for Mr. Wilson raised an issue of bias against Daley R.S.J. Daley R.S.J. ultimately rejected these allegations for reasons set out at 2019 ONSC 3584 and invited costs submissions.
[19] Daley R.S.J. directed that Mr. Wilson was to pay Ms. Fatahi-Ghandehari the sum of $1,500.00 on account of the costs of the bias motion that was argued before him.
[20] On the materials that I have, there is no dispute that these amounts remain outstanding. The total amount of these Orders is $153,368.98. I note that there is a small discrepancy in the amount that I have calculated and the amount Ms. Fatahi-Ghandehari has claimed. That amount is interest on the Orders where there was no interest specifically mentioned. I will address this discrepancy at the end of my reasons.
[21] In addition to these costs, an Order was made by Price J. on January 11th, 2018 for the payment of a fine of $10,000.00 by Mr. Wilson to the Superior Court. That fine has not been paid and I have no explanation as to why.
c) The Proceedings Before Me
[22] I became the case management judge in this matter in early 2020. I had scheduled an appearance before me in April of 2020. That appearance had to be adjourned as a result of the COVID-19 pandemic.
[23] One of the issues that had been outstanding when I assumed my role as case management judge was the question of costs. Daley J., who had been the previous case management judge, had invited the parties to make submissions on the outstanding costs orders in this case. Those submissions were part of the file when I became the case management judge.
[24] Ms. Fatahi-Ghandehari identified that there were significant costs orders that had not been paid by Mr. Wilson, as was clear from the submissions that had been provided to Daley J. I invited submissions from the parties on a number of issues by way of an endorsement on May 11th, 2020. Those submissions were provided over the course of the summer and included the subject of costs.
[25] On the subject of costs, Daley J. had asked Mr. Wilson to explain whether he had paid any of the costs that had been ordered. Daley J. had also asked Mr. Wilson to provide evidence of impecuniosity if he was advancing an argument of impecuniosity. Instead of answering these points, Mr. Wilson provided submissions on the following four points:
Ms. Fatahi-Ghandehari has allegedly stolen significant sums of money from Mr. Wilson.
Mr. Wilson’s mother has purchased the rights to certain causes of action against Ms. Fatahi-Ghandehari and has been prejudiced because these actions are not proceeding.
The notices of assessment for Mr. Wilson demonstrate that he is impecunious.
There is, according to Mr. Wilson, a subsisting marriage contract that should be enforced.
[26] In my decision of August 19th, 2020 (unreported), I considered all of these arguments and rejected them. In terms of impecuniosity, I concluded that there was insufficient evidence to prove that Mr. Wilson was actually impecunious. For the purposes of this motion, counsel for Mr. Wilson has not advanced impecuniosity as a reason for the non-payment of the Court orders. However, Mr. Wilson continues to allege that he has no money to pay the costs orders.
[27] In my Order of August 19th, 2020, I encouraged Mr. Wilson to pay those costs forthwith and advised that I would return to the question of the unpaid costs after I had addressed the undefended trial and the question of the marriage contract. The undefended trial and the marriage contract have been addressed and the purpose of the hearing on September 8th, 2021 was to address the issue of the unpaid costs.
[28] I should note that Ms. Fatahi-Ghandehari has raised the issue of the costs for proceedings before me. I have made the following costs orders:
a) Costs of the undefended trial in the sum of $25,151.31 inclusive of HST and disbursements (see 2021 ONSC 3547).
b) Costs of $2,316.50 flowing from my disposition of the marriage contract issue.
[29] Ms. Fatahi-Ghandehari’s Affidavit makes it clear that there has been at least some effort made to appeal my Orders. In addition, since the hearing before me on September 8th, 2021, I have been provided with a copy of the reasons of Coroza J.A. dated September 28th, 2021. In those reasons, Coroza J.A. provides Mr. Wilson with an extension to perfect an appeal from my decision dated May 26th, 2021. My May 19th, 2021 decision is not mentioned by Coroza J.A.
[30] However, Mr. Wilson has asked that I set aside my decision of May 19th, 2021 under Rule 59.06(2) of the Rules of Civil Procedure. This request means that there is still adjudication to be completed with respect to my May 19th, 2021 decision. As a result, my analysis of the stay motion will not consider the unpaid costs from these proceedings. This decision is without prejudice to Ms. Fatahi-Ghandehari’s right to raise any remaining issues in respect of a failure to pay costs awards once these decisions have been fully adjudicated.
[31] As part of the proceedings before me, I provided the parties with procedural directions on this matter. These directions were set out in a decision dated June 15th, 2021 (2021 ONSC 4311). Pursuant to those directions, the issue of the stay was scheduled for hearing for September 8th, 2021. A timetable for materials was provided to the parties.
[32] However, given the history of this litigation, I determined that it was advisable to schedule a further case conference to ensure that matters were proceeding as they should. That case conference was held on July 28th, 2021. At that time, I was advised that most of the materials were in. However, I was also advised that Mr. Wilson wished to cross-examine Ms. Fatahi-Ghandehari. Ms. Fatahi-Ghandehari objected to being cross-examined. However, I determined that Rule 39.02(1) permitted parties to cross-examine each other on a pending motion. The fact that one side claims that nothing will be gained from the cross-examination is not, without more, a basis for prohibiting the cross-examination.
[33] A cross-examination was scheduled for August 13th, 2021. At that time, Mr. Robson, counsel for Mr. Wilson, asked a series of questions that were all refused. These refusals were raised in argument before me as grounds for adjourning this motion and directing that a further examination of Ms. Fatahi-Ghandehari take place. I reserved on that question. I am dismissing that request, and will set out my reasons for doing so below.
The Positions of the Parties
[34] Ms. Fatahi-Ghandehari argues that a stay of all of Mr. Wilson’s actions should be granted on the basis that Mr. Wilson is a vexatious litigant and that Mr. Wilson has also failed to pay the costs that have been ordered in this matter.
[35] Mr. Wilson has not provided any formal notices of motion on this matter. However, his factum sets out a series of requests for relief. Those requests can be summarized as follows:
a) An order requiring Ms. Fatahi-Ghandehari to reattend for examination.
b) An order that Mr. Wilson be entitled to pay the funds into court rather than being required to pay them to Ms. Fatahi-Ghandehari.
c) An order that Mr. Wilson be entitled to bring a motion under Rule 59.06(2) to set aside my decision of May 19th, 2021 on the basis of a fraud on the part of Ms. Fatahi-Ghandehari and that a new trial be ordered with full rights of participation for Mr. Wilson.
[36] Mr. Wilson’s position is based on his allegations of fraud on the part of Ms. Fatahi-Ghandehari and an allegation that Ms. Fatahi-Ghandehari’s lawyer has also committed fraud.
Issues
[37] The issues that are raised by the facts and the various positions advanced by the parties are as follows:
a) What, if anything, should be done at this stage about the Rule 59.06(2) request made by Mr. Wilson.
b) What, if anything, should be done in respect of Mr. Wilson’s claims of personal impecuniosity.
c) Should Mr. Wilson be permitted to pay the costs into Court?
d) Should a stay be granted for failure to pay the costs?
[38] I will deal with each issue in turn.
Issue #1 – Rule 59.06(2)
[39] Mr. Wilson has alleged that Ms. Fatahi-Ghandehari has committed fraud on the court through her evidence in the undefended trial. Specifically, Mr. Wilson alleges that Ms. Fatahi-Ghandehari did not receive an inheritance, contrary to her sworn testimony in that regard.
[40] Ms. Fatahi-Ghandehari argues that Mr. Wilson is engaged in an abuse of process by even attempting to bring this motion. Ms. Fatahi-Ghandehari also argues that Mr. Wilson is not advancing any new evidence in support of his proposed motion, which is fatal to his position.
[41] I am not prepared to make any Orders in Mr. Wilson’s favour in respect of the Rule 59.06 motion at this time for the following reasons:
a) In my June 15th, 2021 endorsement, I advised the parties that I would not be addressing the Rule 59 motion until such time as I had addressed this Rule 60 motion. Mr. Wilson’s rights to participate in any way in this action hinge on the outcome of the Rule 60 motion. He is not entitled to bring any other motions until the Rule 60 motion is adjudicated.
b) In any event, on the record before me, it is not at all clear that the test under Rule 59 has been met by Mr. Wilson. In addition, Ms. Fatahi-Ghandehari’s argument that this motion would be an abuse of process may have merit.
[42] For reasons set out elsewhere, if the costs are paid to Ms. Fatahi-Ghandehari in accordance with this direction, then I will deal with the Rule 59.06 motion. If the costs are not paid to Ms. Fatahi-Ghandehari, then Mr. Wilson’s right to participate in this action is at an end and I will adjudicate the remaining claims without his participation.
[43] This brings me to Mr. Wilson’s claim that Ms. Fatahi-Ghandehari improperly refused questions at the examination on August 13th, 2021. I reject that claim. There is no need for Ms. Fatahi-Ghandehari to re-attend on the motion for the stay. I reach that conclusion for four reasons.
[44] First, the issue of whether Ms. Fatahi-Ghandehari has committed a fraud is irrelevant to the payment of the costs orders and I have already ruled on this issue. In my August 19th, 2020 decision, I stated as follows:
This brings me to Mr. Wilson’s allegations that Ms. Fatahi-Ghanderhari stole significant sums of money from him. Even if these allegations are true, it does not matter for the payment of the costs orders. The costs awards are awards of the Court, and must be paid in accordance with the terms of the orders. Allegations about the merits of the case may be relevant to whether a costs order should be made but the allegations about the merits of the case are not relevant once the costs order for an interlocutory proceeding is made. If Mr. Wilson had wanted to make those arguments, they should have been made in the original costs submissions or on an appeal of the costs decisions. This argument does not assist Mr. Wilson.
[45] Second, the constant re-litigation of the same question by Mr. Wilson amounts to an abuse of process. Having ruled that the allegations of fraud are irrelevant to the payment of costs over a year ago, I determined the matter. I also noted that the issue of the alleged fraud could have been raised as grounds for not paying the costs when the original costs decisions were made.
[46] Third, and related to the second point, I already advised the parties in my June 15th, 2021 endorsement that the questions of fraud and setting aside the undefended trial decision would not be addressed until the Rule 60 motion was considered.
[47] Finally, the questions that Mr. Robson asked on the examination are clearly irrelevant to the issue of the Rule 60 motion. For example, where Ms. Fatahi-Ghandehari was born and when she came to Canada are clearly irrelevant to the question of whether Mr. Wilson should be allowed to continue with this action in spite of the fact that he has not paid the outstanding costs orders against him. Further, any questions about the alleged fraud are also irrelevant to the Rule 60 motion.
[48] As a result, none of the cross-examination questions that Mr. Wilson’s counsel, Mr. Robson, sought to ask that were refused are relevant and none of them need to be answered in order for me to dispose of this motion. Mr. Robson could also argue that there were other questions that he did not get a chance to ask. The problem with this argument is that this motion is focused on Mr. Wilson’s failure to follow Court orders. The alleged fraud is irrelevant to that question as the Orders have all been made and must be complied with even if the alleged fraud could be proved.
Issue #2 – Claims of Impecuniosity
[49] In his Affidavit of June 30th, 2021, Mr. Wilson states that he does not have the funds to pay the outstanding costs himself but that his mother has agreed to pay those costs on his behalf. In support of this assertion, Mr. Wilson attaches an e-mail from his mother as well as a TD bank statement. There is no indication on the TD bank statement as to who owns the account, although there is approximately $225,000.00 US in the account. I am troubled by this omission from the evidence, particularly given the allegations that have been made against Mr. Wilson that he has had his mother hide money on his behalf in the past.
[50] Ms. Fatahi-Ghandehari disputes the assertion of impecuniosity and argues that Mr. Wilson has sufficient money to pay Mr. Robson which suggests, in turn, that Mr. Wilson has sufficient money to pay the outstanding costs orders. Ms. Fatahi-Ghandehari also argues that Mr. Wilson’s mother has often hidden assets on behalf of Mr. Wilson and that previous Court decisions have already reached this conclusion.
[51] At this point, I will simply observe that I do not accept Mr. Wilson’s claims of impecuniosity for three reasons:
a) I have already determined that Mr. Wilson’s claims of impecuniosity were without merit. My reasons for this determination were set out in my August 19th, 2020 endorsement.
b) There is no evidence to support Mr. Wilson’s claims of impecuniosity. I detailed this lack of evidence in my August 19th, 2020 endorsement and Mr. Wilson has provided no further evidence to explain why he is impecunious in spite of having had my reasons for almost a year when this motion was brought.
c) The evidence that I do have suggests that Mr. Wilson continues to run his exotic car business. This suggests that Mr. Wilson has a flow of income.
[52] I will review the merits of this motion on the basis that Mr. Wilson himself has the funds to pay the costs but has simply refused to pay them. My conclusions on this issue are part of the reason why I have given Mr. Wilson only fourteen (14) days to satisfy the outstanding costs orders. I will not grant Mr. Wilson any further time to pay these costs awards on the basis that he is having difficulty getting the money from other people.
Issue #3 – Should Mr. Wilson Be Permitted to Pay the Funds Into Court?
[53] No.
[54] The disposition of this issue flows from my findings on the first issue. Mr. Wilson argues that he should be permitted to pay these funds into Court rather than to Ms. Fatahi-Ghandehari directly because of her alleged frauds.
[55] As I have explained at paragraph 44, above, any claim of fraud is irrelevant to the question of whether the costs should be paid. The Court has ordered the costs be paid by Mr. Wilson to Ms. Fatahi-Ghandehari, and he is obligated to pay them. They are to be paid directly to Ms. Fatahi-Ghandehari.
[56] The attempt to have the costs paid into Court instead is an attempt to evade the consequences of the Costs orders that have been made against Mr. Wilson. As Quinn J. noted in Gordon v. Starr 2007 CanLII 35527:
[23] Subrule 14(23) should not be taken lightly. It means what it says. It recognizes the offensiveness of allowing a party to obtain relief while in breach of a court order. Court orders are not made as a form of judicial exercise. An order is an order, not a suggestion. Non-compliance must have consequences. One of the reasons that many family proceedings degenerate into an expensive merry-go-round ride is the all-too-common casual approach to compliance with court orders.
[57] Mr. Wilson should have satisfied these costs orders a long time ago. There is no good explanation on the record for his failure to do so. Justice Quinn’s observations bring me to the question of what the consequences for Mr. Wilson’s failure to pay should be.
Issue #4 – Should A Stay Be Granted
[58] I have reluctantly concluded that Mr. Wilson should be permitted one final opportunity to comply with the costs orders that have been made against him.
[59] Ms. Fatahi-Ghandehari argues that a stay should be granted against Mr. Wilson based both on Section 140 of the Courts of Justice Act R.S.O. 1990 c. C 43 and Rule 1(8) of the Family Law Rules.
[60] I start with section 140 of the CJA. The relevant provisions state:
(1) Where a judge of the Superior Court of Justice is satisfied, on application, that a person has persistently and without reasonable grounds,
(a) instituted vexatious proceedings in any court; or
(b) conducted a proceeding in any court in a vexatious manner,
the judge may order that,
(c) no further proceeding be instituted by the person in any court; or
(d) a proceeding previously instituted by the person in any court not be continued,
except by leave of a judge of the Superior Court of Justice.
(5) Nothing in this section limits the authority of a court to stay or dismiss a proceeding as an abuse of process or on any other ground.
[61] This provision has been applied in numerous cases, and a list of factors to identify a vexatious litigant have been developed by the Courts. Recently, in Yae v. Park 2013 ONSC 1331, Morgan J. outlined some of the key features of a vexatious litigant (at para 14):
Nothing says vexatious like a one billion dollar claim against opposing counsel for defending their client’s rights. However, it is still worth reviewing the factors that courts have identified as grounding an order under section 141(1) of the Courts of Justice Act. In Henry J.’s often cited decision in Lang Michener v Fabian (1987), 1987 CanLII 172 (ON SC), 59 OR (2d) 353, at para 20 (Ont Sup Ct), seven indicators of a vexatious litigant were set out:
a) bringing multiple actions to determine an issue that has already been determined;
b) bringing an action where it is obvious that the action cannot succeed, or that the action would lead to no possible good result, or if no reasonable person could expect to obtain the relief being sought;
c) bringing an action for an improper purpose, including harassment of opposing porties [sic] by multifarious proceedings;
d) bringing an action in which grounds and issues raised get rolled forward into subsequent actions and repeated and supplemented, often with actions brought against the lawyers who had acted for or against the litigant in earlier stages of the proceedings;
e) continuing with an action that exhibits the above traits even if originally meritorious;
f) failure to pay costs of unsuccessful proceedings taken along the way;
g) persistently taking unsuccessful appeals from decisions rendered against the litigant.
[62] In this case, there are some factors that suggest that Mr. Wilson is behaving as a vexatious litigant. For example, the positions that Mr. Wilson took on the matrimonial contract caused me to conclude that he was engaged in an abuse of process. In addition, there is an action that has been brought against Mr. Siddiqui, the lawyer who assists Ms. Fatahi-Ghandehari with various matters. It is not clear to me whether that action has any merit. Finally, there have been quite a number of appeals in this action, all of which seem to have been pursued in a very dilatory way. These are all factors that suggest that Mr. Wilson is behaving in the manner of a vexatious litigant.
[63] I would also note that the way that Mr. Wilson addressed his allegations of bias against Daley R.S.J. also raise the appearance that Mr. Wilson is engaged in conduct suggestive of a vexatious litigant. Claiming a judge is biased and then refusing to bring a motion to permit the judge to deal with the allegation of bias that you have raised in an expeditious way is also suggestive of a vexatious litigant who is attempting to subvert the Court processes.
[64] Other Courts have also commented on the conduct of this litigation by Mr. Wilson and his counsel. For example, in denying an adjournment request, the Court of Appeal observed as follows (2018 ONCA 728 at paras. 10 and 11):
[10] The record amply shows that the appellant has made a procedural morass of this case. The record of non-compliance with customary practice and the rules is so egregious that there is no explanation that the appellant or Mr. Robson could provide that would excuse it. On this basis we refused the adjournment.
[11] Given the history of this proceeding, we would quash the appeal even if the order under appeal were final, in the exercise of our inherent jurisdiction to control the process of the court and to prevent its abuse: see Oelbaum v. Oelbaum, 2011 ONCA 300, 94 R.F.L. (6th) 251. This jurisdiction is also recognized in s. 140(5) of the Courts of Justice Act.
[65] Then, there is the failure of Mr. Wilson to pay the costs that have been ordered against him. This is one of the indicia of a vexatious litigant. It is also conduct that can attract sanctions pursuant to separate provisions under both the Rules of Civil Procedure and the Family Law Rules.
[66] Under Rule 1(8) of the Family Law Rules, the Court has a broad discretion to make orders affecting a litigant’s rights to continue with an action where orders, including costs orders, have not been complied with. Rule 57.03 of the Rules of Civil Procedure permits the Court to dismiss or stay an action where costs have not been paid. Rule 60.12 permits the Court to, inter alia, stay or dismiss a party’s proceeding if that party has failed to comply with an interlocutory order.
[67] In this case, a series of costs orders as described at paragraphs 16 to 20 have been made against Mr. Wilson. None of those orders have been complied with. In addition, there has been a series of other orders that have been made against Mr. Wilson in the family law litigation. Those orders were not complied with, Mr. Wilson was found in contempt for failing to comply with these orders and was sentenced for that contempt. The sentence was to strike Mr. Wilson’s pleadings in the family law action. That sentence was upheld by the Court of Appeal.
[68] The test under Rule 1(8) of the Family Law Rules was described in Colivas v. Colivas 2013 ONSC 1991 (at para. 14) as follows:
[16] What is the applicable test for the striking of pleadings under Rules 1(8) and 14(23)? In Moran v. Cunningham (2009), 2009 CanLII 34992 (ON SC), 96 O.R. (3d) 783 (S.C.J.) at para. 58, C. Horkins J. adopts the three part test from Ferguson v. Charlton, 2008 ONCJ 1, [2008] O.J. No. 486 (C.J.):
First, the court must ask whether there a triggering event that would allow it to consider the wording of either subrule 1(8) or subrule 14(23). That triggering event would be non-compliance with a court order "in the case or a related case" [subrule 1(8)] or an order "made on motion" [subrule 14(23)].
Second, if the triggering event exists, the court should then ask whether it is appropriate to exercise its discretion in favour of the non-complying party by not sanctioning that party under subrule 1(8), or by ordering that subrule 14(23) does not apply. My review of the foregoing case law suggests that this discretion will only be granted in exceptional circumstances. In my view, the court's decision whether or not to exercise its discretion in favour of a non-complying party, ought to take into account all relevant history in the course of the litigation and, more specifically, the conduct of the non-complying party.
Third, in the event that the court determines that it will not exercise its discretion in favour of the non-complying party, it is then left with a very broad discretion as to the appropriate remedy pursuant to the provisions of either subrule 1(8) or subrule 14(23).
[69] In short, the Family Law Rules provide the Court with a broad power to sanction parties who are non-compliant with Court orders. In this case, the first part of the test (the triggering event) is clearly met, as Mr. Wilson has Court orders for substantial amounts of costs that he has not paid.
[70] The civil powers in respect of costs awards are discussed by Trimble J. in Dang v. Anderson 2017 ONSC 1448. In that decision, Trimble J. had originally stayed Ms. Dang’s action in December of 2016, and given her a chance to pay the costs orders. When Ms. Dang did not pay the costs orders, Trimble J. ultimately dismissed the action.
[71] This two-step approach to dealing with these types of breaches has two key advantages. First, it provides the party in breach with both a clear warning and an opportunity to remedy the breach. Second, it ensures that the draconian remedy of a dismissal of the action is not enforced until other steps have been taken.
[72] This brings me to a final consideration. I would observe that courts should ensure that a party has a reasonable opportunity to cure any non-compliance before striking out a pleading. See Falcon Lumber Ltd. v. 2480375 Ontario Inc. (GN Mouldings and Doors) 2020 ONCA 310 at para 51 and Koohestani v. Mahmood 2015 ONCA 56 (2015) 124 O.R. (3d) 205 at para 54.
[73] In this case, it is arguable that Mr. Wilson has already had a reasonable opportunity to cure his non-compliance with these orders. In that respect, I note as follows:
a) Most of the costs awards have been outstanding for years.
b) I strongly encouraged Mr. Wilson to pay those costs awards in a decision I released over a year ago.
[74] In addition, Mr. Wilson has already been found in contempt in a portion of this proceeding for failing to comply with Court Orders. As a result, there is a serious issue as to whether Mr. Wilson is actually prepared to be bound by Court orders.
[75] However, in spite of all of my concerns with Mr. Wilson’s conduct to date, I am mindful of the fact that striking a pleading is a drastic remedy. Two other observations should be made:
a) Mr. Wilson has had his pleadings in the family law proceeding struck, with all of the attendant consequences of that decision.
b) Mr. Wilson has not, until now, been given a clear warning that his conduct, if continued, will result in the striking of his pleadings in all of the other actions.
[76] As a result, I am providing Mr. Wilson with a clear warning. The costs owing must be paid within fourteen (14) calendar days from today’s date. They are to be paid to Mr. Siddiqui for Ms. Fatahi-Ghandehari’s benefit. If these payments are not made, then Mr. Wilson’s remaining pleadings will all be struck in all of the actions I am case managing.
[77] This process of providing a clear warning before the consequences I have described above is also consistent with the second and third steps of Rule 1(8) of the Family Law Rules. I have exercised some discretion in Mr. Wilson’s favour by providing him with one last opportunity to pay the costs. I have then fashioned a remedy that fits the circumstances.
[78] In addition, Mr. Wilson is to pay the $10,000.00 fine to the Superior Court of Justice within fourteen (14) calendar days of today’s date. If this payment is not made, then Mr. Wilson’s remaining pleadings will all be struck in all of the actions I am case managing. Proof of payment must be provided to BOTH my judicial assistant and to Mr. Siddiqui.
[79] In addition, I will be closely monitoring the litigation of this action. Mr. Wilson’s conduct is very close to the line of a vexatious litigant. Mr. Wilson should understand that he is being provided with one last chance to bring himself into compliance with this Court’s orders. Mr. Wilson should also understand that any further breaches of Court orders in this proceeding will result in significant and immediate consequences to Mr. Wilson’s position in this litigation.
[80] I am further ordering that, if Mr. Wilson fails to make these payments in the time I have allotted, his claims shall be dismissed and his pleadings shall be struck. The Court will then adjudicate all issues involving Mr. Wilson and Ms. Fatahi-Ghandehari without any further right for Mr. Wilson to participate in that adjudication.
[81] Finally, to ensure proper management of litigation between the parties, Mr. Wilson shall not commence any new proceedings of any type against Ms. Fatahi-Ghandehari without my leave or, in my absence, the leave of the Regional Senior Judge. If Mr. Wilson does not pay the costs within fourteen (14) calendar days of today’s date, Mr. Wilson will also be barred from commencing any new litigation in this Court relating to or touching upon the issues between himself and Ms. Fatahi-Ghandehari.
[82] For greater clarity, Mr. Wilson is also not permitted to take any steps in any of the related proceedings until the costs have been paid and, even then, may not take any further steps without my leave. This does not apply to any matters currently before another Court. For greater clarity, this prohibition on taking any further steps does not apply to the Appeal of my May 26th, 2021 decision. These reasons should not be used by Mr. Wilson as a reason to hold his appeal in abeyance.
Conclusion and Next Steps
[83] Last month, I released an endorsement that was necessary because the parties were unable to agree on what should be included in an Order from a decision that I had made in May of 2021. As a result, I am going to set out the directions flowing from my decision in one place. I am ordering as follows:
a) Ms. Fatahi-Ghandehari is not required to attend for a re-examination on her Affidavit. Mr. Wilson’s request in that respect is dismissed.
b) Mr. Wilson is required to pay the sum of $153,368.98 to Mr. Siddiqui, Ms. Fatahi-Ghandehari’s counsel, within fourteen (14) calendar days of today’s date, being November 26th, 2021 at 4:00 p.m.
c) The payment described in paragraph (b) must be made by certified cheque or money order and must be provided to Mr. Siddiqui personally within the deadline set out in paragraph (b).
d) Mr. Wilson shall pay the Accountant of the Superior Court of Justice $10,000.00 on account of the contempt fine within fourteen (14) calendar days of today’s date.
e) In the event that Mr. Wilson fails to make the payments in paragraphs (b) and (c) within fourteen (14) calendar days of today’s date then his pleadings shall be struck in all actions between himself and Ms. Fatahi-Ghandehari.
f) Mr. Wilson shall not be permitted to take any other steps in the actions being case managed by me without my leave.
g) Mr. Wilson shall not be permitted to commence or continue any other actions against Ms. Fatahi-Ghandehari without my leave.
[84] At this point, the first step is for Mr. Wilson to pay the sum of $153,368.98 to Ms. Fatahi-Ghandehari’s counsel within fourteen (14) calendar days of today’s date.
[85] The second step is for Mr. Wilson to pay the fine of $10,000.00 to the Superior Court of Justice, again within fourteen (14) calendar days of today’s date.
[86] The third step in this matter will be to deal with the Rule 59.06 matter, presuming that Mr. Wilson pays the costs to Ms. Fatahi-Ghandehari’s lawyer. If the Rule 59.06 matter falls to be determined by me, I am a case management judge appointed to manage these actions. While there are differences between my authority under the Rules of Civil Procedure and the Family Law Rules as a case management judge, I also have inherent jurisdiction, including inherent jurisdiction to control the proceedings before me.
[87] To that end, it appears to me that it might be both possible and appropriate to address the proposed Rule 59.06 motion in the following manner:
a) Mr. Wilson would have a limited period after the next case conference to provide an Affidavit or Affidavits setting out the basis for his claim of fraud, when that evidence was discovered and why that evidence was not discoverable prior to May of 2021. These Affidavits must include all documentation that Mr. Wilson is relying on.
b) The parties would then make legal submissions on whether the test under Rule 59.06 could be met by the evidence of Mr. Wilson and, if it could be met, that there are no other reasons for me to exercise any discretion that I may have to decline to hear the matter. It appears that Ms. Fatahi-Ghandehari has already raised the issue of abuse of process in respect of this motion, and the submissions of the parties would consider that issue as well. Those submissions would be made in writing and the timetable for them would be set at the next case conference.
c) As part of their legal submissions, the parties would be required to file their pleadings from the family law matter so that I have them in one place for ease of reference. They would also have the ability to file any other documentation from the family law proceeding that they might wish to rely upon.
d) If, and only if, I determine that the test under Rule 59.06 may be met then Ms. Fatahi-Ghandehari may be called upon to provide responding materials and the parties may be permitted to cross-examine each other.
[88] I have not made a final determination as to whether I should proceed this way, and I am prepared to hear submissions from the parties on the issue of this proposed process, whether an alternative process should be adopted or whether the motion should be heard at all. However, I felt it important to lay the proposed process out in writing before seeking the parties’ submissions on it so that they could make more complete and informed submissions at the next hearing.
[89] I am aware that the normal process for motions is for both sides to provide their materials, for cross-examinations to take place and for the Court to then rule on the motion based on a complete record. However, in preparing their submissions, I would direct counsel’s attention to the decision of D.M. Brown J. (as he then was) in Abrams v. Abrams 2010 ONSC 2703 (2010) 102 O.R. (3d) 645 as well as the decision of Daley R.S.J. (as he then was) in Sims v. Zaitlen 2017 ONSC 2501. Those decisions may assist counsel in forming their views as to whether the process described in paragraph 87 is within my jurisdiction to order.
[90] I will consider the status of this matter at a case conference to take place on December 2, 2021 at 10:00 a.m. This appearance will be for forty-five minutes. Submissions on the issue of the process as set out in paragraph 87 shall be limited to ten minutes for each side.
[91] This brings me to costs submissions. Each party shall have fourteen (14) calendar days from the release of these reasons to serve and file their costs submissions. Those submissions shall be no longer than two (2) single-spaced pages, exclusive of bills of costs, offers to settle and case-law.
[92] Each party shall have seven (7) calendar days after receipt of the other side’s costs submissions to serve and file a reply, if any. The reply submissions are to be no longer than one (1) single-spaced pages, exclusive of case-law.
[93] Submissions must be filed both with the Court office and by providing a copy to my judicial assistant. There are to be no extensions on costs submissions, even on consent, without my leave. If I do not receive costs submissions within the time-limits set out in this decision, there shall be no costs for this motion.
[94] Finally, there is the question of interest. Ms. Fatahi-Ghandehari is clearly entitled to interest on the costs award of January 26th, 2018. However, before granting entitlement to interest on the remaining costs, I am prepared to entertain submissions from the parties on this issue.
[95] To that end, I am directing as follows:
a) Ms. Fatahi-Ghandehari is to provide her calculations of the outstanding interest within seven (7) calendar days of today’s date.
b) Each party shall have seven (7) calendar days thereafter to provide submissions on interest not to exceed two single-spaced pages, exclusive of case-law.
c) Each party shall have seven (7) calendar days thereafter to provide any reply submissions not to exceed one (1) single-spaced page, exclusive of case-law.
[96] Submissions on the interest issue must be filed both with the Court office and by providing a copy to my judicial assistant. There are to be no extensions on the submissions on this issue, even on consent, without my leave.
[97] The provision of submissions on costs and on the issue of interest are an exception to my prohibition on the parties communicating with my judicial assistant for any reason. That prohibition otherwise remains in effect.
LEMAY J
Released: November 12, 2021
COURT FILE NO.: FS-15-83320
DATE: 20211112
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Sara Fatahi-Ghandehari
Applicant
- and -
Stewart Wilson
Respondent
REASONS FOR DECISION
LEMAY J
Released: November 12, 2021