NEWMARKET COURT FILE NO.: FC-18-00055421-0001 DATE: 20230109 SUPERIOR COURT OF JUSTICE – ONTARIO – FAMILY COURT

RE: Stephanie Gagnon (formerly Skaade), Applicant AND: Hans Kristian Skaade, Respondent

BEFORE: The Honourable Mr. Justice D.A. Jarvis

COUNSEL: Jennifer Long, Counsel for the Applicant Symon Zucker, Counsel for the Respondent

HEARD: January 5, 2022

Ruling on Motion

[1] The applicant (“the mother”) has brought a motion to strike the pleadings of the respondent (“the father”) for his failure to comply with successive disclosure Orders of the court, for leave to proceed with an uncontested trial, to amend her pleadings to seek a restraining Order and costs. Her motion is supported by an affidavit served on the father’s solicitors of record on November 17, 2022. The father has not filed any response to the motion.

[2] The mother claims that the father continues to be in breach of his disclosure obligations and disclosure Orders. I agree.

Context/Background

[3] On September 17, 2018 Douglas J. made a final Order (on consent) that mostly dealt with parenting and child support issues (two children, HPS born January 17, 2009 and MVS born May 31, 2012, “the children”). That Order provided, among other things, for what was then termed “joint custody” and provided for a shared parenting regime. On October 2, 2018 this court granted a final Order (on consent) resolving the balance of the parties’ financial issues.

[4] The mother started a Motion to Change in September 2019 to award her what was then termed sole custody of the children and child support. The thrust of the motion was the mother’s allegation that the father’s conduct made it difficult, if not impossible, to co-parent the children and that the children were being harmed by their father’s behaviour. On May 6, 2020, this court made an Order giving directions with respect to an urgent motion by the mother and, on May 8, 2020, further directions were given with respect to involvement of the York Region Children’s Aid Society (“the Society”). The father did not deliver his pleadings in response to the Motion to Change until May 11, 2020. An urgent hearing was held by ZOOM on May 19, 2020. This court noted in its Ruling that the mother had made out “a strong prima facie case for a change in the parenting arrangement” such that continuing it would impact the children’s well being. This court concluded that the father was acting in a manner that escalated conflict. An Order appointing the Children’s Lawyer was made as well as an Order for an urgent case conference. The father was ordered to pay the mother $2,250 for costs relating to the court setting aside a default Order that she had obtained when he failed to file his pleadings in response to her Motion to Change.

[5] An urgent Case Conference was held by McGee J. on June 3, 2020. The parties were directed to exchange proposals for an updated parenting and communication schedule.

[6] On January 11, 2021 the OCL delivered a s.112 clinical investigator’s report (Karen Guthrie-Douse). Among other things it recommended that the mother have sole custody of the children.

[7] On March 1, 2021 Bird J. made an Order requiring the father to provide itemized disclosure.

[8] A Settlement Conference scheduled for May 10, 2021 was adjourned (on consent) because court services were unavailable and the parties were not ready to proceed.

[9] On January 5, 2022 this court made a further Order for disclosure involving the father. This Order included a repetition of the disclosure that Bird J. had ordered but which the father had failed to fully, or convincingly, produce. Additional disclosure was ordered.

[10] There continued to be parenting conflict, which the mother attributed to the father’s behaviour. On August 18, 2022 this court dispensed with the father’s consent to renewing the children’s passports describing his behaviour as “disgraceful”.

[11] On October 12, 2022 this court dealt with a motion by the mother to have the father found in contempt of five Orders of the court made over the preceding two-and-a half year period. Despite timely service of the mother’s materials, the father did not deliver a responding affidavit until either the day before, or the day of, the scheduled motion. The Court declined to accept the father’s affidavit. Even so, when the motion was argued the court concluded that the evidence was insufficient to find the father in contempt. He was found in breach of the disclosure Orders. This Court then dealt with those parts of the motion dealing with the father’s unacceptable failure to comply with his disclosure obligations.

[12] In an oral Ruling the Court laid out for the father the risks and consequences of his non-disclosure conduct, which bear repeating here:

In Her Honour’s order, made in March of 2021, Bird, J. ordered the respondent father to provide the disclosure by March 22, 2021. The disclosure which was ordered, is set out in tab (d) of the applicant mother’s motion. This did not happen.

With respect to the Order which this court made on January 5, 2022 the unsatisfied disclosure was reconfirmed and there were additional disclosure requests added. Counsel agree that some but, certainly, nowhere near all of the disclosure ordered has been provided.

In Roberts v. Roberts, 2015 ONCA 450 a decision of the Ontario Court of Appeal the said, and I quote at paragraphs 11 and 12:

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

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

In Manchanda v. Thethi, 2016 ONSC 3776, Justice Myers was called upon to deal with outstanding disclosure and referenced Justice Chappell in Levely v. Levely, at paragraph 76 and added at paragraph 77 additional comments. Quoting from paragraph 76 of Manchanda v. Thethi, 2016 ONCA 909:

[76] I agree with D.L. Chappell J. who, at para. 12 of Levely v. Levely, 2013 ONSC 1026, wrote:

Family Court proceedings are intended to be a means by which aggrieved parties can have their disputes arising after separation adjudicated upon by the court in a just, efficient and timely manner. Unfortunately, they all too [page415] often become a destructive tool which one party wields and manipulates in order to create further financial and emotional hardship for the other party. The frequency with which Family Law litigation degenerates into an abusive game of delay tactics, stonewalling, and dodging of judicial authority is a concern which must remain at the forefront of the judge's mind in considering remedies for a party's failure to participate as required in court proceedings or to comply with court orders. Family Law litigants who come to the court for assistance must come with a strong sense of assurance that the process will be an effective means of mending and stabilizing the family fabric, rather than a futile money pit of failed justice.

Underlining the next sentence the Court says:

The court has a critical responsibility and role to play in ensuring that proceedings which are intended to protect families and lead to resolution of pressing and emotionally divisive issues are not hijacked by a party and transformed into a process for further victimizing the other party and the children in their care.

At paragraph 77, Myers, J said the following:

[77] Implementing a culture shift to enhance access to justice by promoting efficiency, affordability and proportionality requires the court to re-draw the line between limiting drastic measures and applying the law robustly. In my respectful view, a little less judicial diffidence, a little less reluctance to hold accountable those who would deny justice to their former spouses, and a little more protection of abused parties from abusers, might be a better fulfillment of our critical responsibility as so aptly phrased by Justice Chappell. After 17 years, it is time for the court's words were taken to mean what they say. (Bolding added)

The Court of Appeal also addressed this in paragraph 13 of its decision, Mr. Thethi having appealed this to the Court of Appeal, and at paragraph 13 the Court said:

[13] Our second reason is this: after continual admonitions by the courts and the legislature that parties to a matrimonial proceeding must produce financial documentation, willful non-compliance must be considered egregious and exceptional.

And later:

Those who choose not to disclose financial information or to ignore court orders will be at risk of losing their standing in the proceedings as their claims or answers to claims may be struck.

More recently, in the case of Raisfirooz v. Dajmar, 2022 ONSC 5382, Justice Himel— it was also a disclosure case (at paragraphs 12 and 13)- affirmed the test for the striking of pleadings.

There is no evidence before this Court that the respondent had complied with the entirety of the disclosure Orders made. He is found in breach of them. Mr. Skaade will be given until November 9, 2022 to serve and file, with the Court, an affidavit providing and confirming full compliance with the disclosure Orders made by Bird, J. and this Court, failing which Ms. Gagnon has leave to bring a 14A motion in writing to my attention, on six days notice, to strike the respondent father’s pleadings.

[13] This Court could not have made it any clearer to the father about his disclosure obligations, its expectations and the consequences of his failure to comply.

[14] The father delivered an affidavit sworn on November 9, 2022. It referenced what he had disclosed and appended exhibits. It was little more than a repetition of the affidavit that he had filed on the eve of the October 12, 2022 motion and which this court declined then to consider.

[15] The mother contends that the father has failed to comply with the disclosure Orders of this court, hence her motion to strike.

[16] While several of the mother’s complaints are argumentative, it is clear to this court that the father has been evasively selective in his disclosure, unresponsive to clear (and repeated) requests and that his financial situation is purposely opaque. Examples include:

(a) Paragraph 3 of the Order of Bird J. required full disclosure of information relating to the father’s business interests. This information (as would be expected) minimally included complete financial statements, corporate tax returns and banking records. In his affidavit the father acknowledged that he “did not provide financial statements, statements of profit and loss, balance sheets, corporate income tax returns and [his] business bank accounts… The only business I have an interest in is T3BG Inc, which is also known as Elektrek” (paragraph 6). The documents accompanying the father’s affidavit comprised five years corporate T2 Short Returns for the fiscal years ending 2014 to 2018, all filed on May 13, 2018 and all disclosing no income. The mother points out that the Orders were not limited to earlier periods and implicitly included more recent information beyond 2018. The father continues to operate this company. He has not provided financial statements or any banking records for any fiscal year after December 31, 2013. The father has described himself as self-employed but also having, or apparently had, an interest in a company, Omnia Technologies Inc (“Omnia”). No disclosure of any relevant information dealing with the father’s interest in this business such as tax returns, banking information, etc. has been provided. He did provide a November 29, 2021 letter of resignation from Omnia as its CEO and President and a copy of an October 18, 2018 non-disclosure agreement between Omnia and Ioticiti Networks Inc.;

(b) Tab A of this court’s Order made on January 5, 2022 required the father to produce “all year end financial statements for any business in which [the father] has any interest for the past three years up to current”. The father replied that he had already answered this request in Exhibits “C” and “J” to his affidavit. The father has not complied with the Order. This cannot be viewed as inadvertent. Exhibit “C” comprised an Initial Notice for Omnia submitted to the Ontario Ministry of Consumer and Business Services with an annexed Director/Officer Information Schedule, his 2019 resignation letter, a copy of the Omnia/Ioticiti non-disclosure agreement, the 2014-2018 T2 Short tax Returns for “t3bg inc” (as above) and a 2018 Profit and Loss Statement for the company. Exhibit “J” (see below) was simply an account statement (owner not disclosed) for the period from November 19, 2020 to September 29, 2022;

(c) The father was ordered (twice) to produce bank account statements for two accounts (RBC 3001 and RBC 6704). For the former account he provided statements from October 23, 2019 to February 23, 2021: he did not produce statements for the period from March 1, 2019 to October 22, 2019 and February 24, 2021 to March 1, 2021 and from February 24, 2021 to March 1, 2021. For the latter account he produced statements for the same period as the former account and did not provide statements for the same period as the former account. Nothing more recent has been provided;

(d) The father produced Line of Credit account statements from August 8, 2018 to November 7, 2018, a 2018 yearly statement and statements for the period from February 8, 2020 to March 8, 2021. Nothing more recent has been provided;

(e) In #8 of Tab A to this court’s Order of January 5, 2022 the father was ordered to provide statements for nine accounts or from identified institutions. In his affidavit the father stated that true copies of his Coinsquare account statements, (Exhibit H), his Shakepay statements (Exhibit I) and Elektrek statements (Exhibit J) were attached. The documents attached are virtually unintelligible. The Elektrek statement for the period from November 19, 2020 to September 29, 2022 shows a series of transactions, this for an entity for which no information beyond 2018 has been provided and which information suggested then that the company was inactive, which is clearly not the present case but whose activity now, and since 2018, is pure conjecture because the father has chosen not to disclose it.

[17] Taking into account the procedural history of this file, the father’s conduct and failure to heed the court’s warnings, this court concludes that the father has failed to comply with the Order made on October 12, 2022. It should not be for the mother or this court to have to parse through the scatterings of disclosure which the father has selectively chosen to provide to obtain a transparent picture of his financial situation. At all material times he has been represented by counsel. The record in this case is a litany of misconduct by the father for which he is responsible: the delay in a timely conclusion to the mother’s motion to change is attributable to his litigation misconduct.

Order

[18] An Order shall issue as follows:

(a) The father’s Response to the mother’s Motion to Change is struck;

(b) Leave is granted to the mother to proceed by Form 23C for an uncontested trial Order;

(c) Leave is granted to the mother to amend her pleadings to seek a Restraining Order against the father. This shall be done by no later than January 31, 2023. The father shall have twenty days from his receipt of the amended pleading to deliver an affidavit responding to the mother’s request for the Restraining Order;

(d) A copy of the mother’s affidavit in support of her uncontested trial Order shall be served on the father. He shall not be otherwise entitled to participate in these proceedings;

(e) The father shall pay to the mother for costs of her motion the sum of $7,500 (inclusive of HST), such costs to be enforceable as a support Order.

[19] A Support Deduction Order shall issue.

[20] Approval of this Order by the father is dispensed with. A copy of the proposed Order may be sent to the judicial assistant (Kelsey.Lowes@ontario.ca) for timely issuance.

[21] One further point.

[22] This court pointed out in its Ruling made on October 12, 2022 that there appeared to be a number of Orders made that had not been formally prepared and issued. The court will not entertain any motion by the mother (as above) until that has been done.

Justice D.A. Jarvis Date: January 9, 2023