COURT FILE NO.: FS-20-20649
DATE: 20220804
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
GALIT ALTMAN
Applicant
– and –
YOEL ALTMAN
Respondent
Julie K. Hannaford, Harold Niman & Angela Pagano, for the Applicant
Gary S. Joseph, for the Respondent
HEARD: July 26, 2022
M.D. Faieta j.
REASONS FOR DECISION
[1] The Applicant mother brings this motion for, amongst other things, an order striking the Respondent’s pleadings and setting this Application down for an uncontested trial, an order prohibiting the Respondent from bringing any further proceedings or being entitled to any further relief until he complies with the Orders and an order that the Respondent shall pay the Applicant the sum of $3,500 for each day that he remains in non-compliance with the Orders retroactive to January 17, 2022 for failure to comply with financial disclosure Orders dated October 5, 2021, November 12, 2021 and December 14, 2021 (“the Orders”)
BACKGROUND
[2] The parties began cohabiting in about August 2001 and were married in June 2003. There are three children of the marriage: Shelly, age 16; Liam, age 13 and Maya, age 10. The parties separated on July 20, 2019.
[3] The Respondent is an entrepreneur that has financed high growth companies in biotechnology, technology, e-sports and real estate. In June 2018, the Quebec Superior Court stayed charges that had been laid by the Quebec securities regulator, Autorité des marchés financiers, against the Respondent and others in relation to a $4.9 billion takeover of the parent company of online gambling website, PokerStars. The Respondent was alleged to have been an adviser to the purchaser and faced six charges of insider trading and attempting to influence the market price of the purchaser’s securities.
[4] During their marriage, the parties enjoyed an affluent lifestyle which included a matrimonial home in Forest Hill, a nanny, private schools for the children, exclusive club memberships, private air travel, high-end clothing and shopping experiences, and deluxe spa and beauty treatments.
[5] The Respondent resides in Miami, Florida. While the Respondent has carried on business under many now dormant companies, he states that he currently carries on business under his own name as well as under 2374879 Ontario Inc., 5048967 Ontario Inc., Grandhill Capital Inc. and 2390113 Ontario Inc. The Respondent states that he has no income and that his monthly expenses are $45,370.57. His Financial Statement dated May 30, 2022 shows that he has debts and liabilities of $ 4 million including an outstanding promissory note of about $2.3 million to Edward Gelfand. This statement also shows that he has about $12.6 million in investment and other accounts, including about $5 million in a RRSP account. The Respondent states that the value of his Net Family Property is about $30.5 million however this does not include the value of his interests in 2374879 Ontario Inc., 5048967 Ontario Inc., Grandhill Capital Inc. and 2390113 Ontario Inc. which are still to be determined.
Case Conference – May 6, 2021
[6] At a Case Conference on May 6, 2021, Pinto J. granted the Applicant to bring a motion for financial disclosure, child support, spousal support and other relief. His Endorsement states:
The applicant claims that, despite the parties separating almost two years ago, she has no clarity as to the respondent’s financial situation or, for that matter, her own, since their finances are intertwined. The respondent, for example, set up a corporation, Sababa Consulting Inc., in which the applicant is a shareholder and director. However, in reality the respondent directed the corporation’s affairs and did not file the corporation’s tax returns since 2012.
As well, the respondent had the applicant provide him with a Continuing Power of Attorney (CPOA) which permitted the respondent to make decisions on the applicant’s behalf. The respondent incorporated companies in the applicant’s name during the marriage. The applicant has since withdrawn the CPOA.
The applicant claims that she has not filed her income tax returns for the tax years 2017 to 2020. The applicant’s tax advisors have purportedly advised her that she is facing more than $4M in tax liability, and approximately $3.7 M in corporate tax liability in respect of Sababa. Despite the purported availability of significant funds in safety deposit boxes and the “Mandeville brokerage accounts”, the applicant’s tax advisors have suggested that she no longer use those accounts as those funds are connected to the respondent’s trading activities through Sababa, and need to be preserved until the full extent of the tax liability and true ownership of the funds is discerned.
There is no child or spousal agreement in place. Since separation, the respondent appears to be contributing to the family’s expenses by paying for purchases made on a corporate American Express Card.
The respondent has retained a personal accountant to organize his finances and get his disclosure in order, which he states has been an arduous task, given the complexity of his business interests. The respondent has also retained Certified Business Valuator (CBV) Steve Ranot of Marmer Penner Inc. to complete a valuation of his business interests and income for support purposes. The respondent was unable to identify when Mr. Ranot’s Business Valuation report would be complete. …
I note that the parties separated almost 22 months ago. The financial statement filed by the respondent dated February 22, 2021 states “TBD” under the respondent’s self-employment income. Many of the entries are similarly marked “TBD”.
The reasons provided by the respondent for the paucity of meaningful information on his financial statement are that he travels frequently, his financial interests are extremely complex, his financial holdings at any given time are dynamic, and that CBV Ranot has not completed his report. In his Case Conference brief, the respondent claimed that he “does not know what his income is, as he does not earn an income in a traditional sense.”
I am not satisfied with the respondent’s explanation regarding his lack of financial disclosure. In particular the respondent knew or ought reasonably to have known that, given the nature of his self-employment and business interests, a business valuation and full accounting of his assets would need to be disclosed to the applicant: Blaney v. Blaney, 2012 ONSC 1777, at para. 5. 16. [Emphasis added]
Order – October 5, 2021
[7] Given that the delivery of an Income Report and a Business Valuation Report was not forthcoming despite the fact that Mr. Ranot had been retained in January 2021, the Applicant brought a motion in June 2021 for, amongst other things, an order that the Respondent deliver an Income Report and a Business Valuation Report within 60 days.
[8] In his affidavit sworn June 21, 2021, the Respondent states
As discussed further above, I have been making ongoing and meaningful attempts to get my disclosure together for this proceeding. It has been exceedingly difficult. I have hired several professionals to assist me with same.
It is correct that there are many TBDs listed on my financial statement. I simply do not know the values of same. I have retained an expert to assist me with filling in the blanks.
I retained Mr. Ranot in January 2021 to complete valuations of my business interests and income for support purposes. I have been providing him with ongoing disclosure, including financial statements, tax returns (that have been filed), brokerage statements, summaries of investments and unincorporated losses, which has also been provided to the Applicant. My outstanding disclosure is mainly comprised of personal and corporate tax returns, which I am in the process of getting filed. I hired accounting firm, MNP to assist me in preparing my personal income tax returns and corporate income tax returns/foreign income verification statements (where required) from 2014 to 2020 for:
a. 2390113 Ontario Inc.
b. 9649280 Canada Inc.
c. Grandhill Capital Inc.
My accountants have advised me that they expect to have my taxes filed within two months and Mr. Ranot has advised that once he has this outstanding disclosure from me, it should take him two months to complete his Reports.
Attached hereto and marked as Exhibit “E” is an email from my accountant, and a letter from Mr. Ranot, both providing estimates for how long they anticipate it will take to complete the work I have retained them to do.
I readily admit that it has taken me some time to gather the disclosure my expert requires; I had to hire an internal accountant to help me organize all my files (all around my arduous work schedule). It has taken hours and hours of work and thousands of dollars.
I am making meaningful efforts to get the Applicant the information she requires. I am candidly behind in filing taxes, which is what I am now working on with my accounting firm. In order to complete my valuations, this information is required.
Contrary to the Applicant’s claims, I have been providing her the disclosure I have been providing to Mr. Ranot. I may have some additional disclosure that I recently provided to Mr. Ranot, which I will provide forthwith to the Applicant’s counsel. [Emphasis added.]
[9] By letter dated June 21, 2021, Mr. Ranot estimated that he would be able to deliver the Respondent’s business valuation report and income report within three months after he received the required information from the Respondent. His letter states:
You have asked us to confirm our retainer and the estimated timing of completion for our reports.
We were engaged on January 11, 2021 to prepare the following reports:
a) A calculation of the value of Mr. Yoel Altman's ("Yoel") business interests as at July 20, 2019; and
b) A calculation of Yoel's 2018 to 2020 income pursuant to the Federal Child Support Guidelines.
We are currently awaiting Yoel's 2019 and 2020 personal income tax returns in addition to information and documentation regarding private placements, joint ventures and corporations held as investments by Yoel's direct and indirect business interests. We have been provided with broker statements for Yoel's companies but we have not yet had the opportunity to review these for completeness.
We anticipate having our reports completed about three months after we receive the required information. [Emphasis added]
[10] The Applicant’s motion for disclosure and other relief was granted: See Altman v. Altman, 2021 ONSC 6610. Amongst other things, the Respondent was ordered:
(1) to deliver the Income and Business Valuation Reports from Mr. Ranot by October 25, 2021;
(2) to deliver an affidavit by November 5, 2021 that sets out:
(a) a complete corporate organization chart detailing the structure of the Respondent’s interests in al entities as at the date of separation and currently, including a comprehensive list of any officer/directorships he held at the date of separation or currently holds;
(b) a comprehensive accounting of any and all transactions/activity the Respondent engaged in while using the Continuing Power of Attorney he exercised over the Applicant’s finances and personal information;
(c) any records/agreements for any transactions, including pending transactions of any kind for the period from July 1, 2018 to the date of this order and on a continuing basis, every 30 days (“the reporting period”) involving any assets, whether held directly, indirectly, legally, beneficially, or through a corporation, LLC, partnership, trust or otherwise that the Respondent has an interest in (the “Transactions”);
(d) any records/agreements for any pending or recent past transactions in the reporting period involving any business in which the Respondent has an interest, whether held directly, indirectly, legally, beneficially or otherwise (also, the “Transactions”); and
(e) the contact information for any agents acting on the Transactions;
(3) to provide the Applicant with full access to, and make available to her, all financial and corporate records pertaining to any corporation, LLC, partnership, trust or any property in any jurisdiction in which the Respondent may have an interest, directly or indirectly, legally or beneficially as at the date of separation and subsequently.
(4) to not deplete, dissipate or in any way deal with any and all assets belonging directly or indirectly to the Respondent, and the Respondent is directed to preserve all of his assets pursuant to sections 12 and 40 of the Family Law Act except for: (1) any transactions that occur the ordinary course of business: (2) any payments that this Court orders the Respondent to make in this proceeding, including any order for the payment of spousal support and child support whether in lump sum form or otherwise, however the Respondent shall provide a strict accounting of same to the Applicant as and when requested.
(5) to pay the amount of $1,700,000.00 to the Applicant by October 19, 2021, which amount shall be credited against the Respondent’s child support and spousal support obligations to Applicant once the Court is able to accurately determine same.
Order – November 12, 2021
[11] In order to the permit the Respondent to access funds in his accounts for purposes of paying costs orders and paying his lawyers and others, the restraining order was modified by Order dated November 12, 2021 on condition that details of such payments be provided to the Applicant. In addition, the Respondent was required to provide copies of all statements of account since July 2018 in relation to his accounts at financial institutions. Paragraphs 3 and 4 of that Order states:
The Respondent shall attach to his aforementioned affidavit all statements of account from July 1, 2018 to the present for all accounts held directly or indirectly by the Respondent at any financial institution located anywhere in the world, including Canaccord Genuity Corp., Mandeville Private Client Inc., Hampton Securities Ltd., Haywood Securities Inc., Scotia !Trade/Scotia Capital Inc., Manulife Investments, Pl Finance Corp., IA Securities/IA Private Wealth, TD Canada Trust and HSBC Bank Canada;
Notwithstanding paragraph 18 of the order of Faieta, J. dated October 5, 2021, the Respondent Yoel Altman shall be permitted to access his accounts for the specific purpose of paying costs orders, paying his legal team in this matter, (presently MacDonald & Partners LLP), paying his chartered business valuators Marmer Penner (Steve Ranot) his business and personal accountants and solicitor Robert Centa (the ISS), provided that the Respondent shall provide the Applicant with full details of all payments made and copies of the account statements from the institution on which any payments are drawn showing the making of such payments at the same time that the payments are made.
Order – December 14, 2021
[12] The Applicant brought a motion an Order striking the Respondent’s Answer, and an Order that he not be permitted an audience with respect to the relief sought in the within proceeding given the Respondent’s failure to deliver the Income Report and the Business Valuation Report by October 25, 2021. The deadline for compliance was extended by about three months: See Altman v Altman, 2021 ONSC 8218, paras. 15-18.
[13] The following Orders were made:
By January 17, 2022, the Respondent shall deliver an affidavit to the Applicant that provides particulars of all accounts held directly or indirectly by the Respondent at any financial institution located anywhere in the world at any point since July 1, 2018;
By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021, and November 12, 2021;
By January 17, 2022 the Respondent shall prepare, and provide to the Applicant, an index of those documents that he has delivered to the Applicant;
By January 17, 2022, the Respondent shall prepare, and provide to the Applicant, an affidavit that describes those documents that he has not delivered to the Applicant in accordance with the Orders of October 5, 2021, and November 12, 2021, and what steps he has taken to comply with those aspects of the Orders.
In relation to the documents delivered by the Respondent pursuant to the above Orders, the Respondent shall pay for the Applicant's costs of organizing and indexing those documents on a full indemnity basis. If the parties cannot agree on the amount of those costs, then they shall deliver a three-page outline of the amount of costs claimed to the attention of Justice Faieta by January 17, 2022, for determination;
By December 24, 2021, the Respondent shall direct Steven Ranot to deliver a sworn affidavit by January 17, 2022, that details all of the documents that have been provided to Mr. Ranot by the Respondent;
The Applicant is granted leave to question the Respondent.
ANALYSIS
[14] Rule 1(8) of the Family Law Rules states:
If a person fails to obey an order in a case or a related case, the court may deal with the failure by making any order that it considers necessary for a just determination of the matter, including,
(a) an order for costs;
(b) an order dismissing a claim;
(c) an order striking out any application, answer, notice of motion, motion to change, response to motion to change, financial statement, affidavit, or any other document filed by a party;
(d) an order that all or part of a document that was required to be provided but was not, may not be used in the case;
(e) if the failure to obey was by a party, an order that the party is not entitled to any further order from the court unless the court orders otherwise;(f) an order postponing the trial or any other step in the case; and
(g) on motion, a contempt order.
[15] In Mullins v. Sherlock, 2018 ONCA 1063, paras. 44-478, the Ontario Court of Appeal outlined the following three-part test for the application of Rule 1(8) as follows
44 First, when faced with an allegation of failure to obey a disclosure order, before granting a remedy, the judge must be satisfied that there has been non-compliance with the court order.
45 Second, once satisfied, a judge may have recourse to the alternatives described in Rule 1(8). In assessing the most appropriate remedy, a judge should consider the following factors:
• the relevance of the non-disclosure, including its significance in hindering the resolution of issues in dispute;
• the context and complexity of the issues in dispute, understanding that an uncomplicated case should have little tolerance for non-disclosure, whereas a case involving extensive valuation of assets may permit some reasonable delay in responsiveness;
• the extensiveness of existing disclosure;
• the seriousness of efforts made to disclose, and the explanations offered by a defaulting party for the inadequate or non-disclosure; and
• any other relevant factors.
46 Having considered these factors, the judge will then determine the best remedy. The orders identified in Rule 1(8) are not exclusive. Other approaches may be appropriate. For example, one option might be to invite the moving party to seek at trial an adverse inference from the failure to disclose and for the motion judge to memorialize this invitation in reasons for decision. Parties frequently rely on another option, namely a request for an adjournment to allow for more time to effect disclosure. Occasionally this may be appropriate especially in a complex case, but an adjournment should not be considered to be automatic. Fully compliant disclosure is the expectation, not the exception.
47 If the judge decides to strike, as in the case under appeal, Rule 1(8.4) becomes applicable. As mentioned, this subsection provides that certain consequences apply unless a court orders otherwise. Accordingly, a party is not entitled to participate in a case in any way unless the court orders otherwise. This provision gives the judge the ability to frame the procedural consequences to a party in default. In making this determination, consideration should be given to whether the consequence is responsive to the breach and whether it achieves a just outcome. [Emphasis added]
Step #1: Has the Respondent Complied with the Court Orders?
[16] Attached as Schedule “A” to this Decision is a table that I have prepared that incorporates the submissions of the parties regarding the Respondent’s compliance with various aspects of the Orders dated October 5, 2021, November 12, 2021 and December 14, 2021. The third column of the Chart outlines my findings in respect of each alleged area of non-compliance.
[17] I find that the Applicant has failed to comply with numerous disclosure obligations imposed by Order such as the obligation to: 1) deliver a income and business valuation report by January 17, 2022; 2) “forthwith” deliver to the Applicant, to any documents delivered to Mr. Ranot; 3) deliver a detailed corporate organization chart; 4) deliver a comprehensive accounting of the Respondent’s use of the power of attorney; 5) records of any transaction from July 1, 2018 to the present involving any assets whether held directly or indirectly for Respondent; 6) provide the Applicant with “full access” to all financial and corporate records pertaining to any entity or any property in which the Respondent may have an interest; 7) provide the Applicant with “full details” of all payments made to the Respondent from assets that are the subject of the restraining order dated October 5, 2021.
[18] I also find that the Respondent has failed to comply with aspects of the parenting provisions of the Order dated October 5, 2021, namely: 1) to make specific arrangements for his parenting time with the children; 2) the Respondent has not used the Our Family Wizard to communicate with the Applicant.
Step #2: Assessing the Most Appropriate Remedy
[19] The Applicant submits that the Respondent’s pleadings should be struck and that this Application should proceed to an uncontested trial. The Applicant also seeks an order that the Respondent not be entitled to bring any further proceedings or seek further relief. Finally, the Applicant seeks an order that imposes a penalty of $3,500 per day for each day that the Respondent remains in non-compliance with the Orders retroactive to January 17, 2022.
[20] The Respondent proposes no remedies and submits that the Rule 1(8) should be dismissed.
[21] The focus of the Applicant’s submissions relates primarily to the Respondent’s failure to deliver a Income Report and a Business Valuation Report. As a result of the Respondent’s failure to deliver these reports, the Applicant has no greater insight into the Respondent’s financial affairs than she did three years ago on the date of separation when she requested this information. More than any other of the documents sought, these reports are core financial documents that will aid the Applicant in understanding the Respondent’s financial affairs. By failing to deliver these reports, the Respondent has stalled this Application from moving forward and eventually towards settlement or final determination.
[22] On this motion, the Respondent states:
I acknowledge that I have failed to produce the income and valuation reports of Steve Ranot/Marmer Penner. Mr. Ranot has been provided with responses to his questions at the present time from myself and my accountant and is diligently working to complete the reports. Mr. Ranot’s affidavit sworn July 20, 2022, further explains why the process to prepare the report has been long and provides an estimate of three months remaining for him to complete the report if he receives the required responses in a reasonable time (which I intend to make every effort to do).
[23] In his most recent affidavit, Mr. Ranot states:
Mr. Altman’s financial affairs are complex. The valuation of his direct and indirect business interests at the date of separation and the determination of his income pursuant to the Guidelines is made more difficult because of the following:
The combination of the multiple illiquid privately held investments and the numerous account transactions makes this a time-consuming file.
I am by no means delaying the preparation of this report nor do I have reason to believe that Yoel is doing so.
In terms of when the report may be complete, we have not yet reviewed all of the responses we received since June 28, 2022 and are unaware whether significant additional information and documentation will be required. As explained above, some of the investments are illiquid meaning that there may not be any evidence of value at or near the valuation date and preparing a full valuation of each company would cost more than some of the investments are worth. Accordingly, it is difficult to estimate with reasonable certainty when the valuation reports will be complete. However, if we receive the required responses in a reasonable time, we expect to have the reports ready in three months. [Emphasis added]
[24] Mr. Ranot offers no basis for his opinion that he has no reason to believe that the Respondent is not delaying the preparation of his Income Report and Business Valuation Report. Mr. Ranot states that he has been corresponding with the Respondent and his accountant to gather the information and documents that he requires to complete an Income Report and Business Valuation Report for the Respondent. He sent a request on December 30, 2021 to which the Respondent provided answers on January 7, 2022. Mr. Ranot sent a further request on April 12, 2022 that the Respondent answered on April 13, 2022. Mr. Ranot made two further requests for clarifications and documents on May 12, 2022 which were not answered until June 28, 2022. General ledgers and trial balances for 2018 and 2019 for Grandhill and 2390113 were delivered June 28, 2022. Financial statements for 2018 and 2019 for Grandhill, 9649280 and 230113 were delivered on July 4, 2022.
[25] Based on all the evidence, I have little reason to believe that the Income Report and the Business Valuation Report will be prepared within three months.
Step #3: What is the Best Remedy?
Striking Pleadings
[26] An order to strike a party's pleadings is a drastic remedy that should only be granted in exceptional circumstances and when no other remedy would suffice: Chiaramonte v. Chiaramonte, 2013 ONCA 641, para. 31. In determining whether to strike the pleadings of non-complaint party, a court must (i) consider the substantial disclosure already made; (ii) itemize what disclosure the party had failed to provide; (iii) make a finding of willful disobedience of the order; and (iv) consider proportionality: Manchanda v. Thethi, 2016 ONCA 909, para. 31.
[27] In any event, regardless of the complexity of a spouse’s financial situation, a repeated failure to comply with an order compelling financial disclosure may, even if there is partial compliance, amount to a deliberate attempt the to frustrate the determination of a spouse’s claims for support and equalization: Mullins, supra.
[28] The parties separated three years ago. Mr. Ranot was retained more than 18 months ago. I find that the failure of the Respondent over the last 18 months to deliver an Income Report and Business Valuation Report, and particularly since October 25, 2021 (which was the first Court ordered deadline for these reports), speaks not to the complexity of the assignment (which Mr. Ranot has repeatedly suggested could be completed within two or three months if the Respondent provided timely responses to his questions) but more to the Respondent’s unwillingness to complete these reports and make the required disclosure.
[29] I find that it is just to dismiss strike the Respondent’s Answer, other than those portions that address parenting, if he does not deliver his Income Report and Business Valuation Report, by November 2, 2022. The Respondent is a sophisticated businessman. If had he wanted to deliver these reports and provide the other disclosure by the dates imposed by the Orders, if not earlier, then the Respondent would have marshalled sufficient resources to do so. The Respondent has repeatedly failed to do so. Despite his deliberate failure to comply with the Orders in this regard, I find that it is just to provide the Respondent with a third and final opportunity to deliver the reports.
No Further Proceedings / Relief
[30] I also find that an order prohibiting the Respondent from bringing any further proceedings or being entitled to any further relief until such time as he brings himself into compliance with the Orders is an insufficient sanction in these circumstances as it is not likely to have sufficient coercive effect to result in the preparation of the reports particularly as any complexity related to the preparation of the reports has been more than accommodated by two extensions of the deadline for their delivery. On the other hand, it is a reasonable measure to address compliance with the other aspects of the Orders that the Respondent has failed to comply with.
Penalty of $3,500 per day
[31] The Applicant also seeks the imposition of a penalty pursuant to Rule 1(8) on the following terms:
Mr. Altman shall pay Ms. Altman $3,500 for each day that he remains in non-compliance with Justice Faieta’s Orders (including but not limited to the income and valuation reports said to be prepared by Steve Ranot), retroactive to January 17, 2022.
If Mr. Altman remains in non-compliance with Justice Faieta’s Orders on August 30, 2022, Ms. Altman may bring any motion she deems necessary for further relief from this court, including collection of the penalties contemplated [above].
[32] The Respondent submits that any such penalty should not be greater than $2,500 per day which is highest amount imposed under Rule 1(8): See Di Poce v Di Poce, 2022 ONSC 2099, paras. 15, 19. The Applicant submits that a more severe penalty is warranted given the Respondent’s likelihood to accommodate such a penalty while incurring further delays.
[33] Regardless of the amount of the penalty, I find that there is no jurisdiction to impose a penalty on the Respondent pursuant to Rule 1(8) for the following reasons.
[34] In her Factum, the Applicant characterizes the payment of $3,500 per day as a penalty rather than a fine. This characterization is appropriate given that a fine for civil contempt is to be paid to the Treasurer of Ontario rather than to a party in the proceeding: SNC-Lavalin Profac Inc. v. Sankar, 2009 ONCA 97, paras. 13-17.
[35] In requesting a penalty under Rule 1(8), the Applicant relies on Di Poce, supra, Granofsky v. Lambersky, 2019 ONSC 3251 and Mantella v. Mantella, (2008), 2008 48648 (ON SC), 61 R.F.L. (6th) 252.
[36] In Granofsky, Diamond J. ordered that a “monetary penalty” of $500 per day be paid. He explained, at para. 28, the grounds for this Court’s authority to impose a penalty under Rule 1(8) as follows:
In my view, the Court has jurisdiction under the Family Law Rules to order a fine or monetary payment as part of its role to control and enforce its own process. Such a remedy places a price on non-compliance with court orders and disclosure obligations commensurate with that process. While a remedy of a fine or monetary payment should be reserved to exceptional and/or egregious circumstances, the respondent has been given opportunity after opportunity to comply with his duty to disclose financial information and documentation and I find the case before me to be a fitting example.
[37] On the other hand, in Shapiro v. Feintuch, 2018 ONSC 6746, the court dismissed the Respondent’s request for a payment of $2,500 in “costs” over and above any of his legal fees and disbursements as a consequence of the Applicant’s failure to comply with a parenting order. In arriving at this conclusion, P.J. Monahan J. stated:
38 There is legal authority in the Family Law Rules for ordering one party to make a payment to another party, but only in circumstances where the court finds a person in contempt of court. Rule 31(5)(c) provides that where a finding of contempt is made, the person in contempt may be ordered to pay "an amount to a party as a penalty". But there has been no such finding sought or made in this proceeding and thus Rule 31 cannot provide legal authority for the payment sought by the Respondent.
39 In my view, an order for "costs" under Rule 1(8)(a) only permits an order in respect of the reimbursement of legal fees and disbursements.
[38] In Belcourt v. Charlebois, 2020 ONSC 4124, paras. 27-33, the court dismissed the Applicant’s request for an order requiring the Respondent to pay her $50 per day for each day that he withheld their child from her contrary to the final parenting order. J.P.L. McDermot J. stated that the monetary penalty requested by the Applicant could only be ordered on a contempt motion under Rule 31.
[39] Whether a court may make an order requiring a party to pay a penalty to another party, absent a finding of contempt, pursuant to Rule 1(8) remains an open question at the Ontario Court of Appeal.
[40] In Mantella v. Mantella, (2008), 2008 48648 (ON SC), 61 R.F.L. (6th) 252, the Applicant husband was ordered by D.L. Corbett J. to pay a fine of $2,500.00 per day for every day after April 25, 2008 that certain previously ordered disclosure was not made. On this motion, Van Melle J. found that the Applicant had failed to deliver the required disclosure by April 25, 2008 and ordered that he pay a fine of $185,000.00 to the Applicant. In Mantella v. Mantella, 2009 ONCA 194, the Applicant’s appeal of this Order was quashed on the basis that the Order was an interlocutory order and thus the appeal should have been filed with the Ontario Divisional Court rather than the Ontario Court of Appeal. In obiter, the Ontario Court of Appeal, at para. 22, stated:
The central issue raised in this appeal is whether, absent a finding of contempt, a judge has the jurisdiction under the Family Law Rules to impose and order payment of a fine as part of the case management process. In other words, as submitted by the respondent, is the authority conferred by any of Rules 1(8), 14(23) or 19(10) broad enough to allow for the making of such orders? Whether a fine or penalty can be imposed absent a finding of contempt, and to whom the fine is payable, are novel issues and are important. The novelty and importance of the issues do not, however, make the order into a final one for purposes of appeal.
[41] More recently, in Bouchard v. Sgovio, 2021 ONCA 709 the Ontario Court of Appeal upheld an order granted pursuant to Rule 1(8) that, amongst other things, granted the Respondent mother a temporary parenting order to facilitate the enrollment of her children in a counselling program. However, the Ontario Court of Appeal went on to question, without deciding, whether a penalty could be imposed under Rule 1(8) in the absence of a finding of contempt. David M. Paciocco J.A. stated, at para. 51,:
51 … Stated simply, if the remedy ordered addresses or "[deals] with the failure" to comply with the substantive order and the remedy ordered is found to be necessary to achieve the enforcement of the order being breached, that remedy is prima facie authorized by r. 1(8).
52 I use the term prima facie authorized because I do not mean to suggest that there are no limits to the kinds of enforcement orders that can be made under r. 1(8). For example, it may well be that the remedies that are provided for in r. 31(5), which is reproduced below, cannot be imposed pursuant to r. 1(8), absent a successful contempt motion as contemplated by r. 1(8)(g): see Mantella v. Mantella, 2009 ONCA 194. This proposition seems sensible since contempt orders require proof beyond a reasonable doubt, and although they are remedial in purpose, they are punitive in nature, and are therefore to be used as a last resort: Hefkey v. Hefkey, 2013 ONCA 44, at para. 3; Prescott–Russell Services for Children and Adults v. G. (N.) 2006 81792 (ON CA), [2006] 82 O.R. (3d) 686 (Ont. C.A.), at para. 26. I need not resolve this specific question since the ground of appeal before us concerns only the temporary parenting order and the Building Bridges order, neither of which are remedies contemplated by r. 31(5); the father did not appeal the Hughes Order where the motion judge did impose punitive fines without making a finding of contempt against the father, nor did he raise any objections in this appeal to the motion judge's order that those fines would "remain in full force and effect". Nevertheless, this illustration demonstrates that there may be other legal limits on the kinds of orders that courts may impose under r. 1(8). [Emphasis added]
[42] In dissenting reasons, I.V.B. Nordheimer J.A. stated:
101 …. However, as I have already said, and as my colleague points out, the broad language of the introductory portion of r. 1(8) cannot provide jurisdiction to make whatever order the court wishes. It does not bestow unlimited authority on a judge to do whatever they choose. My colleague implicitly acknowledges that there are constraints on the authority granted by r. 1(8), when he says, at para. 52, “there may be other legal limits on the kinds of orders that courts may impose under r. 1(8)”.
102 I would go farther and make it clear that there are such limits. They are necessary because, before certain types of orders are made against a party, it is necessary to follow certain procedures, including applying the proper burden of proof. These procedures must be followed because they provide necessary procedural safeguards to the person who is to be subjected to any such order. For example, in cases where penal sanctions are sought, those safeguards are provided by r. 31 of the Family Law Rules. Procedural safeguards are not to be avoided simply because it is more convenient or more expedient to do so. [Emphasis added]
[43] I adopt this view. While there is a pressing and growing need for the efficient, effective and timely management of family law cases, the need for fairness requires placing limits on the broad authority provided by Rule 1(8) to impose a remedy for non-compliance with a court order.
[44] There is express authority to order a person to pay fine or penalty under Rule 31(5) of the Family Law Rules if that person is found in contempt of the court for failing to comply with an Order. A finding of civil contempt requires proof of the following elements beyond a reasonable doubt: (1) the order alleged to have been breached must state clearly and unequivocally what should and should not be done; (2) the party alleged to have breached the order must have actual knowledge of it; and (3) the party allegedly in breach must have intentionally done the act that the order prohibits or intentionally failed to do the act that the order compels: Chong v. Donnelly, 2019 ONCA 799, para. 5 (C.A.). As noted in Carey v. Laiken, 2015 SCC 17, para .32, “[t]hese three elements, coupled with the heightened standard of proof, help to ensure that the potential penal consequences of a contempt finding ensue only in appropriate cases”. These heightened requirements and the procedural safeguards provided by Rule 31 are avoided if Rule 1(8), which has no such requirements or procedural safeguards, is used to impose a penalty upon a party for non-compliance with an order.
[45] Accordingly, I dismiss the Applicant’s request to impose a penalty of $3,500.00 per day on the Respondent.
Other Remedies
[46] Two additional matters also require to be addressed under Rule 1(8).
[47] In respect of the Respondent’s obligation to provide documentary disclosure in relation to account statements and other documents from Mandeville Private Client Inc. pursuant to paragraph 12(b), (c) and (d) of the Order dated October 5, 2021 and pursuant to paragraph 1 of the Order dated December 14, 2021, the Respondent acknowledges that he is in breach of those provisions. The Respondent states that he does not have access to those accounts over which he exercised a power of attorney as they belong to the Applicant. An email from Julia Clarke, General Counsel for Mandeville Private Client dated October 25, 2021 sent to counsel for the Applicant states that the company requires the Respondent’s written consent or a court order to provide any account-related information and invited counsel to provide proposed wording for such order or consent. This step has apparently not been taken by either party. I direct that both parties forthwith contact Mandeville Private Client Inc. to provide their consent for the release of all information and documents that is required for the Respondent to comply with paragraph 12 of the Order dated October 5, 2021 and paragraph 1 of the Order dated December 14, 2021.
[48] Further, in respect of the Respondent’s obligation under paragraph 13 of the Order dated October 5, 2021 to provide the Applicant with “full access to, and make available to her, all financial and corporate records pertaining to any corporation, LLC, partnership, trust or any property in any jurisdiction in which the Respondent may have an interest as at the date of separation and subsequently, I order the Respondent to deliver the requisite authorizations to the Applicant so that she can obtain these documents directly. While the Respondent submits that allowing the Applicant to contact institutions that he deals will damage his career, it is my view that the Applicant has reasonable grounds for her to question the completeness of what the Respondent has delivered given his poor history of making prompt and full financial disclosure.
ORDER
[49] I make the following Orders pursuant to the Family Law Rules:
(1) If the Respondent fails to deliver his Income Report and Business Valuation Report, as completed by Mr. Ranot, by November 4, 2022, then:
(a) The Respondent’s Answer shall be struck out, except for the Respondent’s claim for custody and access.
(b) All other documents filed by the Respondent shall be struck out, except as they related to the Respondent’s claim for custody and access, subject to the discretion of the trial judge.
(c) The Applicant shall have leave to proceed to an uncontested hearing on all issues other than custody and access.
(d) In respect of all issues other than custody and access, the Respondent shall have no right to seek disclosure from the Applicant, no right to take any step nor bring any motion in this proceeding, nor shall he be permitted to attend or participate at the uncontested trial unless trial judge otherwise orders.
(2) The Respondent shall not be entitled to bring any further proceedings or be entitled to any further relief until such time as he brings himself into compliance with the Orders dated October 5, 2021, November 12, 2021, and December 14, 2021.
(3) If by November 4, 2022, the Respondent remains in non-compliance with the Orders dated October 5, 2021, November 12, 2021, December 14, 2021, or this Order, then the Applicant may bring any motion that she deems necessary for any further relief from this court.
(4) Each party shall forthwith provide their consent to Mandeville Private Client Inc. for the release of all information and documents that is required for the Respondent to comply with paragraph 12 of the Order dated October 5, 2021, and paragraph 1 of the Order dated December 14, 2021.
(5) By August 9, 2022, the Applicant shall deliver the draft authorizations that will provide her with full access to all financial and corporate records that the Respondent is required to disclose pursuant to paragraph 13 of the Order dated October 5, 2021 and the Respondent shall sign and return those authorizations to the Applicant by August 16, 2022.
(6) If there is a dispute as to the form or content of the consents to be provided to Mandeville Private Client Inc. or the authorizations to be provided by the Respondent to the Applicant in respect of paragraph 13 of the Order dated October 5, 2021, then either party may contact my assistant to arrange a brief appearance to address any differences at the earliest opportunity.
(7) The Applicant shall deliver her costs submissions by August 15, 2022, the Respondent shall deliver his responding costs submissions by August 29, 2022, and the Applicant shall deliver her reply costs submission by September 8, 2022. Each costs submission shall be no more than three pages exclusive of any offers to settle and outlines of costs.
Mr. Justice M.D. Faieta
Released: August 4, 2022
| Item | Order | Applicant’s Position Exhibit E – Affidavit July 11, 2022 |
Respondent’s Position Exhibit A – Affidavit July 20, 2022 |
Findings |
|---|---|---|---|---|
| 1. | Order, October 5, 2021, para. 2. The parties shall make all reasonable efforts to make specific arrangements for the Respondent’s parenting time with the children. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default Yoel has not made “reasonable efforts” vis-à-vis facilitating his own parenting time with the children; rather, he makes only minimal efforts – and rarely visits the children in Toronto where they live. Instead of building a stable life for himself in Canada, Yoel has elected to remain in the US, and has told the children there is “nothing for him” in Toronto anymore. Yoel has also told the children it is “my fault” that he can’t see them because “I won’t allow it” (in truth, Yoel would never see the children if I didn’t continually facilitate travel arrangements to ensure he will be able to exercise his parenting time). |
In Compliance I have made reasonable efforts for parenting time with the children. Galit’s contention that I am making minimal effort is inaccurate. As explained in my affidavit, travel to Toronto is complicated by the freezing order and the fact that I have no funds to use to facilitate regular travel to and from Toronto. |
Default I find that the Respondent has failed to comply with this requirement. Although the Respondent denies the allegations described in paragraph 34 of the Applicant’s affidavit, he does not describe what “reasonable efforts” he has made to arrange for parenting time. He simply states that it is very difficult in light of the freezing order and due to lack of access to personal funds to visit the children in Toronto. Even if this evidence of financial hardship is accepted despite evidence of his lavish lifestyle (such as he lives in a seven bedroom beach house in Miami, has a driver, flies on private planes) the Respondent does not address the Applicant’s evidence that she took the children to Florida on the Victoria Day weekend to see him on her own initiative when the Respondent refused to commit to a plan. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 2. | Order, October 5, 2021, para. 4. Neither party shall disparage or speak ill of the other or discuss any issues regarding parenting arrangements, spousal support, child support or other financial issues between them with the children or in their presence. |
Default Yoel continually maligns me and my family members to the children, causing them confusion and distress. Yoel has told the children that it is my fault that “he has no money” and has to “borrow money” from friends. Yoel has told the children that I have “called the police” on him to stop him from coming to our home (which I have never done). Most recently, Yoel’s behaviour at Liam’s bar mitzvah was shameful. He criticized me and my family to anyone who would listen. I observed that Liam was made uncomfortable on what was supposed to be his special day. |
In Compliance I deny all Galit’s allegations relating to this issue. I do not malign or disparage Galit or her family members and the examples Galit provides are not accurate. |
Default not Established Given the contradictory “he/she said” evidence of the parties on this point, and the lack of independent evidence, I am unable to find that the Respondent has failed to comply with this requirement of the Order |
| 3. | Order, October 5, 2021, para. 6. The parties shall each purchase a subscription to the Our Family Wizard (“OFW”) application and shall communicate through the OFW platform for all child-related communication. The parties shall share information in a timely manner regarding the children. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default After defaulting on Justice Faieta’s initial Order, Yoel eventually obtained a subscription; but he did not provide timely responses such that I have had to default to other forms of communication (such as texting) to coordinate the children’s parenting time or obtain other needed information. |
In Compliance This was purchased on December 15, 2021. Galit claims that she has had to default to other forms of communication but I am able and willing to communicate on OFW. I would like to be consulted and involved in decision-making related to the children, however Galit has been making unilateral decisions without consulting me. |
Default I find that the Respondent has failed to comply with this requirement. Exhibit “F” to the Applicants’ reply affidavit shows that the Respondent has not tried to communicate with the Applicant since March 2022. As a result, the Applicant has used iMessage to increase her chances of getting a response from the Respondent. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 4. | Order, October 5, 2021, para. 8. By October 19, 2021, the Respondent shall pay the amount of $1,700,000 to the Applicant, which amount shall be credited against the Respondent’s child support and spousal support obligations to the Applicant once the Court is able to accurately determine same. |
Default – late payment My lawyers had to send multiple communications and threaten enforcement proceedings when no payment was made by October 19, 2021. Ultimately, payment was made on October 21, 2021 but only after significant follow-up costs were incurred. |
In Compliance Yoel transferred $1,700,000.00 to BMO bank account **655 on October 21, 2021. This payment was made two days late, however the payment was late and I am not in breach of this Order. |
Default Corrected I find that the Respondent is no longer in breach of this requirement given that he has paid the $1.7 million as required albeit two days late. |
| 5. | Order, October 5, 2021, para. 10 The Respondent shall forthwith deliver to the Applicant’s counsel any and all documents that have been produced to Steve Ranot/Marmer Penne and shall provide to the applicant’s counsel on a concurrent and ongoing basis any further documents produced to Steve Ranot. Order, December 14, 2021, para. 2. To forthwith deliver to Galit’s counsel any and all documents produced to Steve Ranot/Manner Penner on a current and ongoing basis. |
Default Again, two court orders were required to obtain an initial tranche of documents/information, and nothing substantive (in terms of either documents or status updates vis-à-vis the reports) has been provided since January of 2022. |
In Compliance An update of the documents produced was sent to the Applicant’s counsel on January 17, 2022. A further update is attached to Steve Ranot’s Affidavit sworn July 20, 2022. |
Default Corrected – I find that the Respondent has failed to comply with this requirement. The affidavit of Steve Ranot states that, on January 12, 2022, he provided a list of all documents that he had received from the Respondent. The Applicant’s accountant provided documents to Steve Ranot on June 28, 2022 and July 4, 2022 in respect of requests that he made on May 12, 2022 for “clarifications and documents”. In turn, these documents were delivered to the Applicant as Exhibits to Steve Ranot’s affidavit sworn July 20, 2022, that was served on that date in respect of this motion. I find that the Respondent breached the Order by failing to deliver these documents “forthwith” to the Applicant. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 6. | Order, October 5, 2021, para. 11. The Respondent shall serve the income and valuation reports that Steve Ranot/Marmer Penner is said to be preparing within 20 days of making this Order. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default The reports remain undelivered and there is no evidence that progress is being made. |
Not in Compliance Explained in Steve Ranot’s Affidavit sworn July 20, 2022. |
Default I find that the Respondent has failed to comply with paragraph 11 of the Order dated October 5, 2021 and paragraph 2 of the Order dated December 14, 2021. |
| 7. | Order, October 5, 2021, para. 9. The Respondent shall continue to pay the cost of tuition for the children. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default – only partial compliance Yoel did not fully comply with this Order for almost 6 months, again requiring multiple follow-ups from my lawyers. While Liam and Maya’s tuition were being charged to Yoel’s Amex, I paid Shelly’s tuition until March 2022 (at an estimated cost of $10,800) and I have never been reimbursed. |
In Compliance Yoel is paying tuition costs for the children every month as of March 2022. Yoel was unaware that Shelly’s tuition was not being paid prior to March 2022, as he thought that the tuition being charged to his Amex card was for all three children. |
Default I find that the Respondent did not comply with the requirements with respect to Shelly’s tuition prior to March 2022. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 8. | Order, October 5, 2021, para. 12. The Respondent shall deliver a sworn affidavit to the Applicant’s lawyer within 30 days of this Order that sets out: (a) a complete corporate organization chart detailing the structure of the Respondent’s interests in all entities as of the date of separation and currently, including a comprehensive list of any officer/directorships he held at the date of separation or currently holds; (b) a comprehensive accounting of any and all transactions/activity the Respondent engaged in while using the Continuing Power of Attorney he exercised over the Applicant’s finances and personal information; (c) any records/agreements for any transactions, including pending transactions of any kind for the period from July 1, 2018 to the date of this Order and on a continuing basis every 30 days (“the reporting period”) involving any assets, whether held directly, indirectly, legally, beneficially or through a corporation, LLC, partnership, trust or otherwise that the Respondent has an interest in (the “Transactions”); (d) any records/agreements for any pending or recent past transactions in the reporting period involving any business in which the Respondent has an interest, whether held directly, indirectly, legally, beneficially, or otherwise (also, the “Transactions”) ;and e) the contact information for any agents acting on the Transactions. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default Yoel is in breach of various aspects of this Order: 1) Yoel provided a new chart, but it was essentially the same one attached to Yoel’s initial Financial Statement sworn February 11, 2021, which was what prompted the request for a more detailed chart in the first place; 2) the comprehensive accounting of Yoel’s activity with the CPOA he had over me was not (and still hasn’t been) provided; 3) Yoel has provided certain account statements on an ongoing basis, however, statements from other institutions/accounts have either not been provided or have not been kept current (e.g. Yoel’s Mandeville Private Client and BMO Mastercard Statements). Few other records, certainly none relating to any pending deals or agreements, have been provided; and 4) Yoel provided a list containing a handful of names, but it was by no means comprehensive. |
a) In Compliance - A corporate organization chart has been provided to the Applicant on multiple occasions, most recently in Yoel’s Affidavit sworn January 16, 2022. A “more detailed” chart cannot be provided. The chart that has been sent to Galit on several occasions is a corporate organization chart that includes all the relevant companies. b) Not in Compliance - This is addressed in Yoel’s Affidavits sworn November 23, 2021 January 16, 2022 and July 20, 2022. Yoel cannot provide a comprehensive accounting as he does not have access to Galit’s Mandeville statements. c) / d) In compliance - This is provided in Yoel’s Affidavit #1 sworn January 16, 2022 and in this Affidavit sworn July 20, 2022. As explained in this Affidavit, Yoel does not have access to the Mandeville Private Client statements. e) In Compliance - Contact information for any agents acting on the transactions was provided at Exhibit “D” of Yoel’s Affidavit #2 sworn January 16, 2022. |
Default I find that the Respondent has failed to comply with paragraph 12(a) of the Order dated October 5, 2021. Neither the Organization Chart provided with his affidavit sworn January 16, 2022, nor that affidavit, indicates whether the Org Chart reflects his interests as of the date of separation, currently or some other time. Further, neither the Org Chart nor the affidavit provides a list of any offer/directorships held by the Respondent at the date of separation and currently held. Similarly, I find that the Respondent did not comply with paragraph 2 of the Order dated December 14, 2021. I find that the Respondent has not complied with paragraph 12(b) of the Order dated October 5, 2021. The Respondent states that he only exercised the CPOA in respect of accounts at Mandeville. He also states that he is unable to provide the required accounting because he does not have access to those accounts. I also find that the Respondent has not complied with paragraph 12(c) and 12(d) of the Order dated October 5, 2021. Mandeville is prepared to release the relevant account statements with client authorization or pursuant to a court Order. I find that the Respondent did not comply with paragraph 2 of the Order dated December 14, 2021. |
| 9. | Order, October 5, 2021, para. 13. The Respondent shall provide the Applicant with full access to, and make available to her, all financial and corporate records pertaining to any corporation, LLC, partnership, trust or any property in any jurisdiction in which the Respondent may have an interest, directly or indirectly, legally, beneficially as at the date of separation and subsequently. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default My lawyers have asked for authorizations to be obtain the records they/my experts need, but these requests have been rebuffed—without further information, there is no way to determine whether Yoel has disclosed the full scope of any corporation, LLC, partnership, trust or any property in any jurisdiction in which he may have an interest, directly or indirectly, legally or beneficially as at the date of separation and subsequently. Moreover, of the accounts I do know about, full particulars/records have not been provided. |
In Compliance Yoel has and continues to make good faith efforts to obtain everything requested, and he has provided Galit with all financial and corporate records. However, he will not provide authorizations, and this is not required under Justice Faieta’s Order. To allow Galit and her counsel to start contacting institutions and business contacts will further damage his ability to resurrect his career and the relationships he relies upon to make a living. Galit already intruded into Yoel’s business relationships and many companies have made clear to Yoel that they do not want to become involved in the parties’ matrimonial difficulties. |
Default In my view, the obligation under para 13 of the Order dated October 5, 2021 to provide “full access” includes an obligation, if requested, to deliver an authorization to obtain the documents described in para 13 from third parties. While this is not the usual approach to obtaining another party’s financial records, in this case, the delay in providing disclosure makes this approach reasonable and necessary. I find that the Respondent has failed to comply with the above provision. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 10. | Order, October 5, 2021, para. 18. Unless the parties otherwise agree, or this Court otherwise orders, the Respondent and any other persons acting on his behalf shall be restrained from depleting, dissipating or in any way dealing with any and all assets belonging directly or indirectly to the Respondent, and the Respondent is directed to preserve all of his assets pursuant to sections 12 and 40 of the Family Law Act except for: (1) transactions that occur in the ordinary course of business; (2) any payments that this Court orders the Respondent to make in this proceeding, including any order for the payment of spousal support and child support whether in lump sum form or otherwise, however the Responding shall provide a strict accounting of same to the Applicant as and when requested. [Emphasis added] Order, November 12, 2021, para. 4. Notwithstanding paragraph 18 of the Order of Faieta J. dated October 5, 2021, the Respondent shall be permitted to access his accounts for the specific purpose of paying costs orders, paying his legal team in this matter …, paying his chartered business valuators …, his business and personal accountants and solicitor Robert Centa (ISS), provided that the Respondent shall provide the Applicant with full details of all payments made and copies of the account statements from the institution on which any payments are drawn showing the making of such payments at the same time that the payments are made. Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default Accountings of the various payments made under Justice Faieta’s Orders have been requested by my lawyers on numerous occasions but have never provided. |
In Compliance – Assets have been preserved. A chart listing the payments made is attached as Exhibit E to the Respondent’s affidavit sworn July 20, 2022 |
Default The Applicant’s bald assertion that the Respondent has not provided an accounting of all transactions and payments as described in paragraph 18 of the Order dated October 5, 2021 is an insufficient basis to find that the Respondent has failed to comply with this provision. However, I note that Exhibit E of the Respondent’s affidavit dated July 20, 2022 only provides a list of transactions and payment. There is no evidence that the Respondent has provided account statements in respect of such transactions and payments in accordance with paragraph 4 of the Order dated November 12, 2021. I find that the Respondent has failed to comply with paragraph 4 of the Order dated November 12, 2021. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 11. | Order, November 12, 2021, para. 3. The Respondent shall attach to his aforementioned affidavit [to be delivered by November 19, 2021] all statements of account from July 1, 2018 to the present for all accounts held directly or indirectly by the Respondent at any financial institution located anywhere in the world, including Canaccord Genuity Corp., Mandeville Private Client Inc., Hampton Securities Ltd., Hawyood Securities Inc., Scotia ITrade/Scotia Capital Inc., Manulife Investments, PI Finance Corp. IA Securities /IA Private Wealth, TD Canada Trust and HSBC Bank Canada Order, December 14, 2021, para. 2. By January 17, 2022, the Respondent shall comply with the Orders of October 5, 2021 and November 12, 2021 |
Default Instead of delivering an affidavit attaching all of his account statements in accordance with the Order, Yoel’s counsel sent a series of emails containing various dumps of unlabeled, disorganized electronic information, with no comprehensive index or chart to lend coherence to the information—which, did not even adhere to the court-order time period (no information from 2018 was provided). Unnecessary time and costs were once again incurred by virtue of having to organize this information. Further/more organized information was subsequently provided, but, as indicated above, it is not complete (certain statements from various accounts/institutions have not been provided, even after multiple requests). |
No position outlined in the Respondent’s Chart However, the Respondent’s affidavit, paras. 22-26, states that he has delivered most of his account statements except for several that he has requested but not yet received. |
Default I find that the Respondent has failed to comply with paragraph 3 of the Order dated November 12, 2021. In respect of the above provision, I find that the Respondent has failed to comply with paragraph 2 of the Order dated December 14, 2021. |
| 12. | Order, December 14, 2021, para. 1. By January 17, 2022, the Respondent shall deliver an affidavit that provides particulars of all accounts held directly or indirectly by the Respondent at any financial institution located anywhere in the world at any point since July 1, 2018. |
Default Yoel provided an affidavit, but particulars regarding the key institution, namely Mandeville Private Client, were not provided. No description, no account particulars, no account numbers. Yet, this is the institution through which $55,000,000 of trades were made by Yoel using a CPOA obtained improperly from me. |
In Partial Compliance – This is provided in Yoel’s Affidavit #1 sworn January 16, 2022. Galit notes that the affidavit was provided, but particulars regarding the key institution, Mandeville Private Client, were not provided. As explained in my Affidavit sworn July 20, 2022, I have no access to these Mandeville Statements. They are in Galit’s name and she has access to them. I am not understanding why Galit continues to make this request when she has access to the statements and I do not. |
Default I find that the Respondent has failed to comply with paragraph 1 of the Order dated December 14, 2021. |
| 13. | Order, December 14, 2021, para. 4. By January 17, 2022, the Respondent shall prepare, and provide to the Applicant an affidavit that describes those documents that he has not delivered to the Applicant in accordance with the Orders of October 5, 2021, and November 12, 2021, and what steps he has taken to comply with those aspects of the Orders. |
Default Yoel delivered an affidavit, but the affidavit was not responsive to the order. Instead, Yoel made claims that he was “only” in breach of “parts” of the Orders. In his affidavit, Yoel asserted he is providing additional disclosure to Mr. Ranot, but none of this appears to have been provided to my lawyers. Regarding the CPOA accounting, Yoel again does not provide an estimate as to when this will be delivered and indeed does not provide any indication that he intends to comply with this Order at all. |
In Compliance – Yoel’s Affidavit #3 sworn January 16, 2022 explains the documents that have not been delivered. Galit acknowledges that Yoel provided an Affidavit, but argues that it was not responsive to the Order. The issue with regard to documents provided to Mr. Ranot is addressed in Mr. Ranot’s Affidavit sworn July 20, 2022. The CPOA is explained on multiple occasions in this chart and in Yoel’s affidavit dated July 20, 2022. Yoel cannot prepare the tracing without access to the Mandeville statements. Yoel will provide the tracing if Galit would like to provide him with the statements. |
Default I find that the Respondent has failed to comply with this provision as the Respondent’s affidavit sworn January 16, 2022 did not adequately describe what steps he had taken to comply with the delivering outstanding documents to the Applicant. |
COURT FILE NO.: FS-20-20649
DATE: 20220804
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
GALIT ALTMAN
Applicant
– and –
YOEL ALTMAN
Respondent
REASONS FOR DECISION
Mr. Justice M. D. Faieta
Released: August 4, 2022