Court File and Parties

NEWMARKET COURT FILE NO.: FC-11-38487-02 DATE: 20231110 SUPERIOR COURT OF JUSTICE – ONTARIO – FAMILY COURT

RE: Mary Ann Iturriaga, Applicant AND: Jaime E. Iturriaga, Respondent

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

COUNSEL: Andrew Feldstein, Counsel for the Applicant Cherry E. Isaacs-Reynolds, Counsel for the Respondent

HEARD: November 1, 2023

Summary Judgment Ruling

[1] The applicant (“the wife”) has brought a Summary Judgment Motion seeking an Order that the respondent (“the husband”) pay her $193,596.50 together with pre-judgment and post-judgment interest and full recovery costs. It is opposed by the husband.

[2] For the following reasons, the wife’s motion is granted.

[3] Subject to the court’s treatment of a Request to Admit by the wife to which the husband never responded, these are the relevant facts:

(a) The parties were married on April 19, 1987, and separated on April 23, 2010.

(b) There are two children of the parties’ marriage, both now independent adults neither of whom is otherwise relevant to the issue before the court.

(c) The parties signed a comprehensive Separation Agreement (“the Agreement”) having an effective date (being the date when the last of the parties signed) of January 7, 2011. The wife was not represented; the husband was represented by a lawyer.

(d) The terms of the Agreement relevant to the wife’s motion deal with equalization of the parties’ net family properties. Assets and debts were specifically addressed and identified in the Agreement and the husband agreed to pay an equalization payment of $210, 980. [1] There was no reference in the Agreement to a joint TD Waterhouse account (“the Waterhouse account”). However, reference was made to this account (but without an account number) in a net family property statement that accompanied the Agreement. [2]

(e) The parties did not sell the matrimonial home before signing the Agreement. At the time, they agreed that they would equally share its net proceeds of sale once remedial work was completed and the secured line of credit on title was paid.

(f) When the parties sold the matrimonial home, there were issues with respect to post-separation adjustments impacting the amount to be paid to the parties. The wife claims that she did not receive all of the equalization payment owed to her or the appropriate amount (adjusted for post-separation adjustments) relating to the sale.

(g) The wife started an Application in 2015 to enforce what she contended was the balance of funds owing to her for the equalization payment and from the sale of the matrimonial home. On October 1, 2015, Kaufman J. made an Uncontested Trial Order (“the Kaufman Order”) that the husband owed the wife $156,468.63. A Writ of Seizure and Sale was issued by the court on October 26, 2015.

(h) Once he learned about the Kaufman Order, the husband brought a motion to have it set aside. Rather than proceed with the husband’s motion, the parties agreed to conference the issue(s), which was done on June 16, 2016 (Douglas J.). There was considerable delay after the conference with respect to what the wife says were the husband’s repeated assurances that he would advance a settlement position. Shortly after the wife served a Summary Judgment Motion in that proceeding in mid-2017, the parties agreed to questioning.

(i) Questioning of the parties proceeded on August 30, 2017.

(j) In preparation for the parties’ questioning, the wife became aware that she had never received her share of the Waterhouse account after the Agreement was signed. While a TD Bank account had been referenced in the Agreement, that was a “Canadian Margin Account” owned by the husband. Ten days after the Agreement was signed, the husband’s brother-in-law presented to the wife, and she signed, a document purporting to be a release with respect to a “joint TD Canada Trust” account but which did not identify the account as the “Waterhouse account”. The document did identify the joint account number.

(k) The husband acknowledged in his questioning that the wife should get one-half of the Waterhouse account if it had not been included in the calculation of the equalization payment, but he said it had been included.

(l) During the course of the husband’s questioning, when the parties’ lawyers were discussing on the record whether the equalization payment included the Waterhouse account (the husband’s position) or excluded it (the wife’s position, meaning that she was still owed her equal share of it), the husband’s lawyer (Pellman) who had acted for the husband when the Agreement was signed advised that due to a “rather significant difference of opinion” with his client, he could no longer act for him and needed to get off the record. The questioning was adjourned.

(m) The wife’s Summary Judgment Motion was also adjourned to pursue settlement further. When that was unsuccessful, the wife started a second Application (this proceeding) on August 2, 2019, for one-half of the Waterhouse account, which as of December 31, 2010, totaled $387,193.01.

(n) The parties exchanged Pleadings in the second Application. The husband delivered an Answer and a financial statement. The lawyers for the parties at the time (Mr. Feldstein and Ms. Isaacs-Reynolds) were the same lawyers who argued the motion now before this court.

(o) A Case Conference in these proceedings was held on September 10, 2020.

(p) The parties took no further steps until on or about June 19, 2023, when the wife served a Request to Admit on the husband in the prescribed form (“the Request”). He had twenty days to respond. Minutes before the expiry of the time for the husband’s reply to the Request (July 10, 2023), Ms. Isaacs-Reynolds contacted Mr. Feldstein’s office to advise that she had no instructions from her client. Later, when she was informed that the wife was bringing this summary judgment motion, she emailed the court to advise that her client had not retained her for a summary judgment motion.

(q) It is common ground that the husband has never responded to the Request, and he has not sought an extension of time to deliver a response to it.

Request to Admit

[4] Despite there being two Applications, the issue raised in the wife’s motion now before the court deals only with the TD Waterhouse account.

[5] The Request to Admit served by the wife in this case sets out procedural facts, many of which are referenced above (and which accord with the court record) and contain other factual statements which, for the most part, do not involve questions of mixed fact and law or a question of law.

[6] The admissions sought relevant to the wife’s motion are those set out in paragraphs 4, 5, and 22 to 38 and 40 of the Request:

4. You and Ms. Iturriaga executed a Separation Agreement on December 1, 2010. A copy of the Separation Agreement is attached as Schedule A.
5. The Separation Agreement was prepared by your solicitor, namely, Mr. Paul Pellman. Ms. Iturriaga was not represented at the time the Agreement was signed and did not obtain independent legal advice in respect of the Agreement.
6. You oversaw the family finances during the marriage and were responsible for managing all your and Ms. Iturriaga’s accounts and financial affairs.
7. Ms. Iturriaga was not familiar with account numbers and values, nor even what accounts you both (either jointly or solely) held.
8. Ten days after you and Ms. Iturriaga executed their Separation Agreement, you requested that Ms. Iturriaga sign an Agreement regarding a joint TD Account. A copy of this Agreement is attached hereto as SCHEDULE “C”.
9. On January 17, 2011, your brother-in-law, Mr. Hassan Farra, attended at the matrimonial home. Mr. Farra presented Ms. Iturriaga with a piece of paper titled “Agreement” and demanded that she sign a copy.
10. The agreement which was presented (and which is attached hereto at Schedule “C”) states the following: The parties jointly agree, as per the separation agreement dated December 1st of 2010 and signed in agreement on December 22 of 2010. They agree to be bound by this agreement, which settles all the outstanding issues in regard to the joint TD Canada Trust all under the #7W3772 Account to be the sole owner Jaime Iturriaga, and MaryAnn to be withdrawn from the records of ownership for the present or future disputes.
11. The Agreement presented to Ms. Iturriaga was drafted by you.
12. The Agreement does not mention the term “Waterhouse” nor is there any value given to the account.
13. You advised Ms. Iturriaga that her signature on the TD Agreement was necessary in order to carry out the terms of the Separation Agreement. Specifically, you advised Ms. Iturriaga that the purpose of the TD. Agreement was to allow you to solely deal with the bank regarding the line of credit on the matrimonial home pending sale.
14. You warned the Applicant that if she did not sign the Agreement, she would face financial consequences.
15. As a result of the pressure she received from you, Ms. Iturriaga signed the Agreement on January 17, 2011.
16. Your and Ms. Iturriaga’s Separation Agreement does not reference the TD Waterhouse account.
17. You requested that copies of the statements for the TD Waterhouse account be sent to yourself directly. Please see attached a statement for the TD Waterhouse Account #7W3772 as of December 31, 2010 (attached SCHEDULE “D”). The statement provides, “per your request, copies of this statement are sent to Mr. Jaime E. Iturriaga”.
18. Ms. Iturriaga was not privy to statements for this account.
19. Ms. Iturriaga was unaware of what happened to this account until August 29, 2017. The statement at SCHEDULE “D” was only received by Ms. Iturriaga at the questioning held August 29, 2017.
20. Until August 29, 2017, Ms. Iturriaga believed the TD Agreement was required to place the joint line of credit in your sole name. It was only through the questioning of you and through discussions with her counsel prior to same, that Ms. Iturriaga became aware of what the Agreement meant.
21. Ms. Iturriaga did not have legal advice when she signed the TD Agreement, did not comprehend what she was signing, and she was placed under the duress of you and your brother-in law, who arrived at her home, and demanded that she sign said agreement. There were no witnesses to the agreement.
22. You took advantage of Ms. Iturriaga’s lack of awareness and financial acumen in the same manner you took advantage of her during the calculation of the equalization payment and disbursements of the net proceeds of sale of the matrimonial home (which you yourself erroneously and manipulatively calculated and presented to the real estate lawyer acting on the sale) which was the cause of the first Application.
23. The value of the TD Waterhouse Account #7W3772 as of January 17, 2011 was $387,193.01. Ms. Iturriaga, as a joint owner of the account at the time the TD Agreement was signed, is entitled to 50% of the value of same, being the sum of $193,596.50.

[7] The husband never delivered a response to the Request.

[8] Rule 22 of the Family Law Rules deals with the admissions of facts and documents:

22. (1) An admission that a document is genuine is an admission,

(a) if the document is said to be an original, that it was written, signed or sealed as it appears to have been;

(b) if it is said to be a copy, that it is a complete and accurate copy; and

(c) if it is said to be a copy of a document that is ordinarily sent from one person to another (for example, a letter, fax or electronic message), that it was sent as it appears to have been sent and was received by the person to whom it is addressed.

Request to admit

(2) At any time, by serving a request to admit (Form 22) on another party, a party may ask the other party to admit, for purposes of the case only, that a fact is true or that a document is genuine.

Copy of document to be attached

(3) A copy of any document mentioned in the request to admit shall be attached to it, unless the other party already has a copy or it is impractical to attach a copy.

Response required within 20 days

(4) The party on whom the request to admit is served is considered to have admitted, for purposes of the case only, that the fact is true or that the document is genuine, unless the party serves a response (Form 22A) within 20 days,

(a) denying that a particular fact mentioned in the request is true or that a particular document mentioned in the request is genuine; or

(b) refusing to admit that a particular fact mentioned in the request is true or that a particular document mentioned in the request is genuine, and giving the reasons for each refusal.

Withdrawing admission

(5) An admission that a fact is true or that a document is genuine (whether contained in a document served in the case or resulting from subrule (4)), may be withdrawn only with the other party’s consent or the court’s permission.

[9] In Serra v. Serra, 2009 ONCA 105, the Court of Appeal observed that the Rules involving admissions are a “useful practice” purposed “to dispense with proof at trial and to minimize the cost of litigation and the areas of dispute between the parties”, and "[f]or legitimate policy reasons, these objectives are to be encouraged.” Serra, at para. 109. In Norris v. Norris, 2016 ONSC 7077, a case upon which the wife relies, the wife in that case brought a summary judgment motion after serving a Request to Admit. After noting that “[t]he conduct of litigation requires strategic thinking”, Corthorn J. implicitly endorsed the Serra reference to encouraging these objectives so as “to enable the court to deal with cases justly”, which is the primary objective of the Family Law Rules. Norris, at paras. 66 and 71. Those are set out in Rule 2(3) of the Family Law Rules, O. Reg. 114/99 and include the following:

(a) ensuring that the procedure is fair to all parties;

(b) saving expense and time;

(c) dealing with the case in ways that are appropriate to its importance and complexity; and

(d) giving appropriate court resources to the case while taking account of the need to give resources to other cases.

[10] A fact deemed true may, in certain circumstances, be withdrawn. The scope of the court’s discretion over the deemed admissions to which effect should be given will vary according to the circumstances giving rise to a party’s failure to respond and whether the admission involves fact, mixed fact and law, or a question of law. For example, where the failure to respond is due to satisfactory evidence of inadvertence or a mistake, or where there is a reasonable explanation for the change in a party’s position, a deemed admission may be withdrawn. Forget v. Forget, 2001 CarswellOnt 3271 (Ont. S.C.), at para. 17. Where a Request involves minute details of marginal value to the larger issues in the case, a court may refuse to consider the Request or any deemed admissions arising from it. Splett v. Pearo, 2011 ONSC 5329, at paras. 4-9. Serial Requests may amount to an abuse of process, being neither cost effective nor advancing the interests of the case. Admissions involving mixed fact and law, or a question of law are generally of little weight. Serra, at para. 111.

[11] A Request to Admit will be most successful where it is crafted to avoid patently controversial facts or propositions involving law. It can be a useful strategic tool at any stage of a family law proceeding and is entirely consistent with the primary objective of the Family Law Rules. A party who ignores a Request does so at their peril.

[12] In this case, the following observations are relevant:

(a) The husband claims that he “may not have been properly served with the Request to Admit”. The fact is that his lawyer of record was, in fact, served with the Request and engaged with the wife’s lawyer and the court shortly before the deadline for responding and afterwards.

(b) There is no evidence that the failure to respond to the Request was inadvertent. This is important. In Norris, the husband made a request during argument for leave to bring a motion to extend time. The court held that even though his lawyer’s “minimal” explanation was unsatisfactory, the husband should be given an opportunity to fulsomely explain his failure given the serious litigation consequences to his “deemed” admissions. Norris, at paras. 73 and 74. There is no evidence in the case at hand (and there was certainly no argument when the motion was argued) that the husband’s failure to respond was inadvertent.

(c) There is no evidence that the husband ever contemplated bringing a motion asking the court to extend the time for delivering a response to the Request. No such request was made during argument.

(d) There is no evidence that the wife was asked, or agreed to, a waiver of the deadline.

(e) Before the husband’s lawyer’s office was served with the Request, she did not represent, at any point (after she was retained by the husband, delivered his responding pleadings and attended at the case conference), that her retainer was limited or that she was merely acting as his agent. This was acknowledged by Ms. Isaacs-Reynolds during argument.

(f) Despite his lawyer saying to the court administration that the husband had not retained her to act for him with respect to the wife’s summary judgment motion, no Notice of Change in Representation has ever been served. Additionally, in his affidavit, the husband pointed out, perhaps unwittingly and as a complaint about the wife’s lawyer, that “given all of the exchanges and offers to settle between the parties, it would have been courteous of Mr. Feldstein’s office to reach out to Ms. Isaacs-Reynolds to discuss the matter previous to serving [him] with such a request.” There is no evidence that the husband was self-representing during any of these “exchanges” or dealing with “offers to settle” independent of his lawyer.

(g) The husband submitted that the court should direct a trial to reopen the entirety of the parties’ Agreement and deal with their financial affairs on a global basis. This is precisely the kind of mischief that the Family Law Rules seeks to avoid and is inconsistent with the primary objective.

[13] The husband is deemed to have admitted the facts set out in the wife’s Request to Admit.

Summary Judgment

[14] A Summary Judgment motion can fulfill very important objectives in family law proceedings. It enables the court to make an expeditious, less expensive and proportionate disposition of a case in whole or in part.

[15] The procedure governing a motion for summary judgment is set out in Rule 16 of the Family Law Rules, the relevant provisions of which provide as follows:

RULE 16: SUMMARY JUDGMENT

WHEN AVAILABLE

16. (l) After the respondent has served an answer or after the time for serving an answer has expired, a party may make a motion for summary judgment for a final order without a trial on all or part of any claim made or any defence presented in the case. O. Reg. 114/99, r. 16 (l).

EVIDENCE REQUIRED

(4) The party making the motion shall serve an affidavit or other evidence that sets out specific facts showing that there is no genuine issue requiring a trial.

EVIDENCE OF RESPONDING PARTY

(4.1) In response to the affidavit or other evidence served by the party making the motion, the party responding to the motion may not rest on mere allegations or denials but shall set out, in an affidavit or other evidence, specific facts showing that there is a genuine issue for trial.

EVIDENCE NOT FROM PERSONAL KNOWLEDGE

(5) If a party’s evidence is not from a person who has personal knowledge of the facts in dispute, the court may draw conclusions unfavourable to the party.

NO GENUINE ISSUE FOR TRIAL

(6) If there is no genuine issue requiring a trial of a claim or defence, the court shall make a final order accordingly.

POWERS

(6. l) In determining whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties, and the court may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence.

[16] As stated by the Supreme Court of Canada in Hyrniak v. Maudlin, 2014 SCC 7, to succeed on a summary judgment motion, an applicant must prove that there is no genuine issue requiring a trial”. Hyrniak, at para. 43. “No genuine issue for trial” has been equated with “no chance of success” and “plain and obvious that the action cannot succeed.” Kawartha-Haliburton Children’s Society v. M.W., 2019 ONCA 316, at para. 13.

[17] A two-step analysis is required. The judge must first determine if there is a genuine issue requiring a trial on the evidence without using the additional fact-finding powers set out in Rule 16(6.1) of the Family Law Rules. If, after this initial determination, there remains a genuine issue for trial, the judge may resort to the additional fact-finding powers to decide if a trial is required. These powers involve the weighing of evidence, evaluating credibility, drawing inferences and possibly receiving oral evidence on the motion. The use of these powers is discretionary.

[18] Nothing in the husband’s evidence contradicts the fact that when the parties signed their Agreement, the balance of their jointly owned Waterhouse account was $387,193.01 as of December 31, 2010. He cannot point to any evidence contradicting the wife’s evidence that she never received any of the funds in this account. He ignores entirely the wife’s evidence of the circumstances surrounding her signing of the release that resulted in the husband becoming the sole owner of the Waterhouse account. While he maintains that he has scheduled a motion to set aside the Kaufman Order, and while the disposition of that motion (if pursued) may result in a variation of that Order, the fact is that as owner of one-half of the Waterhouse account, there is no evidence that the wife ever received her share. In fact, the overwhelming evidence is to the contrary. The equalization payment that the husband owed to the wife did not include anything for her share of the Waterhouse account; the calculation was premised on the parties each retaining their half-share of the account.

[19] There is no genuine issue; the husband owes the wife $193,596.50 from and after December 31, 2010.

[20] Even if there should be a genuine issue for trial, no trial is warranted. The evidence is that for years, the husband has delayed dealing with the wife’s complaints that she was never paid the equalization payment to which the parties agreed, and, in essence, she was compelled to bring two Applications to enforce her contractual and ownership rights. It is not an unreasonable inference that the husband has done procedurally little to set aside the Kaufman Order because that serves his financial interests. He is not credible. He complains, for example, about service of the Request when the evidence is clear and uncontradicted that valid service was made on his lawyer of record. He had his brother-in-law approach the wife to release her interest in the Waterhouse account in circumstances where the court suspects that the husband took advantage of the wife’s uncontradicted evidence of her historical reliance on his handling of the parties’ family finances. The document she signed did not properly disclose the name of the account. He misrepresented the purpose for the release.

Disposition

[21] The wife’s motion is granted. The husband shall pay to the wife $193,596.50 with interest from and after December 31, 2010, calculated at the pre-judgment and post-judgment rates (both fourth quarter) pursuant to sections 128 and 129, respectively, of the Courts of Justice Act, R.S.O. 1990, c. C.43.

[22] As for costs, the parties advised that each sought costs in the $13,000 range if they were successful, exclusive of preparation and attendance at the motion. The wife’s Bill of Costs is calculated on a full recovery basis. It identifies dates and times for the legal services provided, the lawyers involved (Mr. Feldstein and a junior lawyer), their experience and hourly rates and a description of the work done. No Bill of Costs was provided by the husband. No reference was made by either party to an Offer to Settle.

[23] In reviewing the wife’s Bill, over forty hours were recorded, most by the junior lawyer. The motion was not complicated. There are overlapping dockets (although not excessive), and a factum (not required but still of some assistance). Taking into account the wife’s success, the foregoing factors and the considerations mandated by Family Law Rule 24 dealing with costs, a fair and reasonable amount to award to the wife is $11,000 inclusive of disbursements and H.S.T.

Justice D.A. Jarvis Date: November 10, 2023

Footnotes:

[1] The husband’s November 30, 2010, Net Family Property Statement showed a $341,507.26 equalization payment owing to the wife. The Agreement provided for an equalization payment of $323,980 which was reduced to $210,980 to reflect post-separation adjustments.

[2] This statement showed a valuation date balance of $295,162 for the account and was adjusted so each party’s share in that account was equal and therefore of no impact in calculating the equalization payment (i.e., a “wash”).