COURT FILE NO.: 301/20
DATE: 20231211
SUPERIOR COURT OF JUSTICE, FAMILY COURT- ONTARIO
RE: Stephanie Michelle Niessen, Applicant
AND:
Kevin John Niessen, Respondent
Rita Niessen, Party to the motion
BEFORE: Mr. Justice Robert B. Reid
COUNSEL: M. VanderSpek, Counsel, for the Applicant
A. Sarnowski, Counsel, for the Respondent
J. Reina Tamayo, Counsel for the party to the motion
HEARD: November 27 & 28, 2023
decision on motion
Introduction:
[1] The applicant and respondent are former spouses, having been divorced October 3, 2022, and are the parents of three children. The application was issued on August 4, 2020 including, as amended, claims for equalization, freezing and preserving assets and the sale of family property. Since that time, the parties have litigated numerous disputes, some of which relate to the alleged failure of the respondent to provide proper disclosure. Contempt motions are pending.
[2] Rita and Heinz Niessen are the parents of the respondent.
[3] Rita Niessen is the director and president of 20 Valley Communities Inc. (“20 Valley”), previously known as Solera Commons Inc. (“Solera”) which was incorporated in January 2021.
[4] In the motion before me, the applicant seeks an order:
that the respondent’s mother, Rita Niessen be added as a party both personally and in her capacity as director of 20 Valley;
for oral questioning of Rita Niessen;
that Rita Niessen, as director of 20 Valley provide specifically enumerated disclosure;
that the respondent and Rita Niessen, as director/owner of Solera provide specifically enumerated disclosure;
that the respondent provide disclosure relating to funds loaned to him by his parents and related information about his financial status;
that Rita Niessen and 20 Valley be enjoined from encumbering or otherwise dealing with a property known municipally as 3446 Rittenhouse Road, Vineland, Ontario; (“Rittenhouse Road”); and
that the respondent, Rita Niessen and 20 Valley be enjoined from encumbering or otherwise dealing with a property known municipally as 3731 19th Street, Jordan Station, Ontario (“19th Street”) and Rittenhouse Road.
[5] The motion did not seek to add 20 Valley as a party, although that claim is contained in the Amended Amended Application.
[6] The overall purpose of the motion was to help quantify the value of the parties’ equity in property and to preserve assets pending the equalization of net family property. The involvement of Rita Niessen is based on the allegation that some of the assets she controls, either personally or through 20 Valley, are properly assets that should be considered in the calculation of net family property.
[7] The request that the respondent’s father, Heinz Niessen, be added as a party was withdrawn.
[8] At the motion hearing, the respondent agreed to provide the documentation requested in paragraph 8(a) and (b) of the notice of motion regarding loans from his parents. The respondent also agreed to provide the information requested in paragraph 8(c) and (d) if any exists. Based on the consent, there will be an order accordingly.
[9] Also at the motion hearing, the parties consented to a temporary and without prejudice order as requested in paragraphs 10 and 11 of the notice of motion, enjoining Rita Niessen and 20 Valley from encumbering or otherwise dealing with Rittenhouse Road, and enjoining the respondent, Rita Niessen and 20 Valley from encumbering or otherwise dealing with 19th Street and Rittenhouse Road, pending the release of my decision on this motion.
Properties at Issue:
3922 23rd Street, Vineland
[10] On the date of the parties’ separation in August, 2019, their matrimonial home was 646 Vine Street, St. Catharines. However, they had put an offer on 3922 23rd Street, Vineland (“23rd Street”) which was to be the site on which their new matrimonial home was to be constructed. The purchase closed six days after their separation, and title was taken in the parties’ joint names. The matrimonial home was sold at the same time. The applicant believes that the net sale proceeds from the sale of the matrimonial home were used by the respondent to construct the new premises at 23rd Street.
[11] The respondent has made a constructive trust claim against the applicant concerning 23rd Street on the basis of improvements he alleges were made by him by which the applicant (as joint owner) was unjustly enriched.
[12] By virtue of a recent title search, the applicant discovered that the respondent caused 23rd Street to be transferred to his name alone on August 3, 2022 without the applicant’s knowledge or consent. On a previous motion by the applicant, the court ordered disclosure of the solicitor’s real estate file concerning the transaction and the evidence appears to show that there was a fraudulent transaction engineered by the respondent using false email addresses and identification for the applicant who appears to have been impersonated by an imposter.
[13] The applicant alleges that 23rd Street has been encumbered by the respondent without the applicant’s agreement, and the applicant’s equity has been eroded accordingly.
[14] In view of the apparently fraudulent conveyance, on August 28, 2023, Brown J. granted a temporary and without prejudice ex parte order enjoining the respondent from selling, pledging, mortgaging, transferring, assigning, diminishing or otherwise disposing of or dealing in any manner with 23rd Street. That order continues in full force and effect.
3731 19th Street, Jordan Station
[15] In or about April 2022, 20 Valley purchased 19th Street with plans to develop it.
[16] Funds for the purchase of 19th Street appear to have come from a previous development project at 3987 Azalea Crescent, Lincoln, Ontario (“Azalea Crescent”). Solera, nominally owned by Rita Niessen, became the owner of that property on March 29, 2021 when the respondent, through his corporation Northshore Homes Ltd. (“Northshore”), transferred the title to Solera. Solera became 20 Valley.
[17] In her order of August 28, 2023, Brown J. granted an order that a certificate of pending litigation issue against 19th Street. That order continues in full force and effect.
4040 Victoria Avenue Vineland and 3446 Rittenhouse Road, Vineland
[18] 4040 Victoria Avenue, Vineland, Ontario (“Victoria Avenue”) was purchased in April 2017 by the respondent and his parents in equal shares. In her order of August 28, 2023, Brown J. granted an order that a certificate of pending litigation issue against that property.
[19] In June 2023, Victoria Avenue was transferred by the respondent and his parents to the owners of Rittenhouse Road. In exchange, Rittenhouse Road was transferred to 20 Valley. The exchange was for equal value. The respondent signed financing documents for 20 Valley concerning Rittenhouse Road.
[20] The applicant concedes that she has no continuing claim to an interest in Victoria Avenue, and as a result agrees that there should be an order discharging the certificate of pending litigation authorized by Brown J. There will be an order accordingly.
Addition of Rita Niessen and Rita Niessen as Director of 20 Valley as a Party:
[21] Rule 7(5) of the Family Law Rules[^1] mandates “that any person who should be a party shall be added as a party”.
[22] In general, the court should not exercise its jurisdiction to add a party unless an order could be made in favour of or against the individual once added: Worral v. Worral, 2012 ONSC 4388, at para. 20. That restriction is not absolute, but in cases where orders could not be made in favour of or against an individual, the discretion to add a party should be exercised very sparingly: Worral at para. 23. In this case, based on the lack of clarity as to the involvement of Rita Niessen with the titles to the properties in which the applicant claims an interest, it is quite possible that orders will be made against her in the course of this litigation. Perhaps the most obvious circumstance for such an order would be to compensate for the apparent disappearance of the respondent’s ownership interest in Victoria Avenue when it was swapped for Rittenhouse Road.
[23] I also note that, as was advised during the motion hearing, the applicant had applied by 14B motion to amend her application to include a claim for relief pursuant to the Fraudulent Conveyances Act[^2] in relation to the transfer of title of Victoria Avenue in exchange for Rittenhouse Road. That order has now been granted. An order made under that Act could well involve Rita Niessen.
[24] Rita Niessen in her personal capacity and as director of 20 Valley is closely linked to the property dispute between the parties.
[25] She and her husband are said by the respondent to have been a source of funds for him in his property development activities.
[26] There is ample evidence to show that Rita Niessen in her personal capacity has been involved in the ownership and transfer of properties in which the applicant claims an interest. For example, Rita Niessen had an ownership interest in Victoria Avenue until June 2023. She was involved in the swap of that property for Rittenhouse Road, title to which was taken by 20 Valley. In her decision of August 28, 2023, Brown J. determined that there were triable issues raised by the applicant as to her interest in Victoria Avenue, the encumbrance or disposition of which could impact the respondent’s ability to fund any equalization payment.
[27] As to 20 Valley, it is owned by Rita Niessen and she is its principal officer and director. The evidence is clear that Rita Niessen herself has no expertise in property development. She is 69 years old, has no experience in construction, no high school education, and worked as a cook for a number of years in a retirement home until her retirement at age 65. The evidence is also clear that the operation of 20 Valley, nominally by Rita Niessen, is directed by the respondent. In fact, despite his assertion that he is a mere property manager and salaried employee of 20 Valley, he showed himself on his LinkedIn public profile as director of 20 Valley until that profile was brought to the court’s attention in a previous motion. Immediately thereafter that on-line reference was removed.
[28] As noted, 20 Valley became the sole titled owner of Rittenhouse Road following the property swap with Victoria Avenue in which property both the respondent and Rita Niessen had an ownership interest.
[29] It is appropriate that Rita Niessen be added as a party to these proceedings in her personal capacity and as director of 20 Valley. She should be a party not only to protect her own personal and corporate interests but also to respond to legitimate disclosure claims made by the applicant. There will be an order accordingly.
Oral Questioning of Rita Niessen:
[30] The series of property acquisitions, dispositions, and financings involving Rita Niessen is not uncomplicated. It is desirable that her personal and corporate involvement be disclosed, explored and clarified prior to trial in order that proper information can be made available to the applicant and ultimately to the court.
[31] I consider that it would be unfair to the applicant to pursue her case without the oral questioning of Rita Niessen based on the clear connection between her personal and corporate activities as regards the properties in question and the activities and involvement of the respondent with those same properties. The applicant has made numerous requests for disclosure from the respondent which remain wholly or partially outstanding. The respondent has taken the position that he does not have control of 20 Valley and he obviously cannot compel his mother to disclose information about her activities involving the properties. I find that the information to be sought from Rita Niessen is not easily available by any other method than by the oral questioning requested.
[32] A further prerequisite for an order for oral questioning is the condition that the order will not cause unacceptable delay or undue expense. It is clear from a review of the file that considerable expense has already been incurred by the parties in litigating the net family property division issue. It is also clear, as for example in the fraudulent transfer of 23rd Street by the respondent, that transparent disclosure by him as regards issues surrounding the properties is unlikely. In the circumstances, the incurring of expense for oral examination of Rita Niessen will not be disproportionate or undue and may in fact expedite the resolution of the matter. I conclude that there will be no unacceptable delay or undue expense caused by an order for oral questioning.
[33] For the foregoing reasons, it is appropriate that an order be made permitting the oral examination of Rita Niessen, pursuant to rule 20(5) of the Family Law Rules and there will be an order accordingly.
Disclosure by Rita Niessen of 20 Valley Documents:
[34] Contained in the applicant’s notice of motion is a list of disclosure requests that relate to the ownership and operation of 20 Valley. She requests an order that Rita Niessen provide that disclosure as director of 20 Valley.
[35] The profile report from the Ontario Ministry of Public and Business Service Delivery shows that 20 Valley was incorporated January 15, 2021 under the name Solera Commons Inc. It appears that the name was changed to 20 Valley on March 28, 2022.
[36] Part of the requested disclosure relates to the incorporation of 20 Valley and to the history of its shareholders, directors and officers. This is a reasonable request because of the apparently fluid relationship between the respondent and Rita Niessen as to the ownership and control of that corporation.
[37] Another part of the requested disclosure relates to the financial affairs of 20 Valley. Because of the lack of transparency in its financial transactions concerning the properties in question, an order for disclosure of that information is also appropriate.
[38] Further, the requested disclosure relates to documentary details of the purchase and sale of any property by 20 Valley as well as arrangements for financing. These details may well be relevant to the claim by the applicant that the respondent, or 20 Valley acting on his behalf, has depleted the equity in properties in which the applicant claims an interest.
[39] Because the time period covered by the disclosure request is just under three years, and because of the modest number of development projects in which 20 Valley or its predecessor Solera were involved, I conclude that making an order for the disclosure requested does not place an onerous burden on Rita Niessen.
[40] Part of the disclosure request relates to corporate income tax returns and notices of assessment relating to 20 Valley. I do not consider that those documents are relevant to any of the claims made by the applicant that are before the court.
[41] The respondent has deposed that he occupies a salaried employment position with 20 Valley. Since his access to funds is an issue in the proceeding both as it relates to the properties in question and as to the respondent’s ability to pay child and spousal support, it is reasonable for Rita Niessen as director of 20 Valley to provide that information.
[42] The applicant seeks from Rita Niessen the names of professional planners and consultants that may have been engaged by 20 Valley including any applicable contracts. That level of disclosure, which might otherwise seem overly minute, is justified because of the apparently fraudulent activities of the respondent. Those activities include the transfer of the applicant’s interest in 23rd Street as already identified. As well, he has a criminal record for fraud and admits to having applied for CERB benefits in the name of the applicant without her knowledge or consent during the recent pandemic. In short, he cannot be relied on to provide accurate information and therefore, to the extent that money was or is being paid out by 20 Valley to third parties for services rendered to 20 Valley, that disclosure is relevant and justified.
[43] Any income received by 20 Valley from tenants of 19th Street may be relevant to its financial affairs and therefore the disclosure requested in paragraphs 6(o) and (p) of the notice of motion is reasonable.
[44] The request for copies of credit card statements for credit cards held in the respondent’s name alone or jointly with another person or held in trust on the respondent’s behalf are claims that may be made against the respondent but are not an obligation that should be imposed on Rita Niessen. There will be no order as to production as requested in paragraph 6(l) of the notice of motion.
[45] Therefore, and on the basis of the foregoing, including the integral relationship between 20 Valley and the properties in question, there will be an order that Rita Niessen, as director of 20 Valley provide to the applicant within 30 days the disclosure requested in paragraph 6(a) to (p) of the notice of motion, with the exception of the requests in paragraphs 6(d) and (l).
Disclosure by Rita Niessen and Kevin Niessen of Solera Documents:
[46] As noted above, 20 Valley was incorporated January 15, 2021 under the name Solera Commons Inc. As of the initial return dated May 5, 2021 the respondent was shown as an officer. Rita Niessen was shown as secretary and treasurer and it appears that she became president on August 23, 2022.
[47] On January 18, 2019 (before the parties separated), Azalea Crescent was acquired by the respondent’s company, Northshore. Northshore transferred Azalea Crescent to Solera on March 29, 2021, 19 months after the parties’ separation.
[48] Solera was incorporated to facilitate the development of Azalea Crescent, which in turn was sold to a third party in February 2022.
[49] The applicant asserts that since Azalea Crescent was an asset of Northshore during the marriage, and since it was transferred to and sold by Solera under the control of either or both of Rita Niessen and Kevin Niessen, she is entitled to disclosure of details regarding the Azalea Crescent acquisition, financing, development and sale. I agree, especially because of the non-arm’s length relationship that apparently existed amongst the respondent, Rita Niessen, Northshore, and Solera.
[50] The applicant also seeks confirmation of the names of any professional planners and consultants that may have been engaged by Solera including any applicable contracts. As I noted when dealing with the similar disclosure request concerning 20 Valley, that detail of disclosure is justified because of the apparently fraudulent activity of the respondent. The applicant is entitled to see proof of any claimed expenses paid for such services by Solera.
[51] Therefore, there will be an order that Rita Niessen and the respondent provide to the applicant within 30 days the disclosure requested in paragraph 7(a) to (m) of the notice of motion.
Certificate of Pending Litigation re: Rittenhouse Road:
[52] The applicant seeks an order that a certificate of pending litigation (“CPL”) be issued and registered on the title of Rittenhouse Road. She amended her application in early September 2023 to include that claim. The purpose of a CPL is to protect an interest in land in situations where other remedies would be ineffective.
[53] Although the Family Law Rules do not refer to CPLs, they do provide in rule 1(7) that: “the court may give directions, and the practice shall be decided … by reference to the Courts of Justice Act.” I conclude that if the basis for a CPL is made out, it may be granted in the context of a Family Law Act[^3] claim.
[54] Pursuant to s. 103 of the Courts of Justice Act, the court can exercise its discretion to issue a CPL where an interest in land is in question. The parties acknowledge that the court should not inquire about the likelihood of success but rather whether there is a triable issue as to such interest.
[55] The applicant has the onus of convincing the court that there is a triable issue as to her interest in Rittenhouse Road. If she does, the respondent must demonstrate that there is no triable issue.
[56] In her decision of August 28, 2023, Brown J. reviewed the law applicable to the granting of a CPL at paragraph 24. I agree with her references and will not repeat them here.
[57] She concluded at paragraph 44 that the applicant’s claims were plausible, had merit and that there was sufficient evidence to show that there were triable issues as regards an interest in Victoria Avenue. However, I note that her decision was made on an ex parte basis. In this motion, the court has had the benefit of responding materials and submissions of opposing counsel, and it is appropriate to take a fresh look at the CPL issue.
[58] A threshold question is whether, by asserting claims for equalization, freezing and preserving of assets and the sale of family property, the applicant has brought into question an interest in land.
[59] In Carey v. Almuli, 2013 ONSC 6976, Justice Kiteley reviewed the question of whether a CPL could be granted where the interest in land was brought into question by a claim for an equalization payment. She referred with approval, as did Justice Brown in her decision of August 28, 2023, to Nash v. Gilbert, 1993 CarswellOnt 3972 at para. 18:
However, in proceedings for a certificate of pending litigation, there is no requirement that the non-titled spouse should claim an interest in land. As the law has evolved, the test is whether an interest in land is “brought in question”. In its preamble, the Family Law Act recognizes marriage as a “form of partnership”, and expresses the necessity to provide in law for the “orderly and equitable settlement of the affairs of the spouses upon the breakdown of the partnership”. The elaborate provisions contained in Part I are designed to achieve this result. As part of the process, the Act recognizes the obvious fact that the “values” to be equalized flow from the spousal property. Thus, an order for preservation may be granted under section 12 of the Act, if the court considers it necessary for the protection of the “other spouse’s interests under this Part”. Further, an equalization application may result in an order for the sale or other disposition of property, including the matrimonial home, under the wide powers conferred by section 9 of the Act. In circumstances of this nature, it does not seem an extravagant use of language to suggest that an application for an equalization payment does bring an interest in land in question, and that the claimant spouse should be afforded the protection of a certificate. Indeed, absent this protection, the statutory scheme could be defeated should the property in issue come into the hands of a bona fide purchaser for value without notice.
[60] I disagree with the distinction drawn by the court in Nazar Estate v. Nazar, 1998 CarswellOnt 4648 to the effect that the reasoning in Nash should be limited to cases in which the applicant sought to set aside an allegedly fraudulent conveyance in order to realize her entitlement to an equalization payment.
[61] Ultimately, since the issuing of a CPL is a discretionary remedy, the governing principle is that the court must exercise its discretion in equity and look at all relevant matters between the parties in determining whether a CPL should be granted.
Did the Applicant have a triable interest in Victoria Avenue?
[62] In this case, the request for a CPL as to Rittenhouse Road flows from the question of whether there was a triable issue as to her interest in Victoria Avenue. To that question is added a second factor which is the change in ownership that occurred at the time of the swap between Victoria Avenue and Rittenhouse Road.
[63] Put in the simplest terms, the applicant had an expectation that the value of Victoria Avenue, to the extent of the respondent’s one third interest, would be included in the respondent’s assets to be included in the calculation of net family property. Of course, the calculation of that value as of the date of separation is an exercise in looking back at values at a fixed point in time.
[64] The bigger concern for the applicant is that the actions of the respondent have eroded or put out of reach his assets such that the applicant will have no ability to realize on an equalization payment once established. His actions in failing to provide disclosure despite court orders, his fraudulent dealings with the 23rd Street property, his denial of having control of 20 Valley and his apparent use of 20 Valley to remove assets from his name give some traction to the applicant’s concerns. Those activities have been undertaken following the history of fraudulent conduct that resulted in criminal charges and the unauthorized application for CERB payments.
[65] In the affidavits filed by the applicant, she has attempted, despite incomplete disclosure, to examine the numerous financial interactions between the respondent, 20 Valley and Rita Niessen. The purpose of the transactions is not immediately obvious. It may be that once full disclosure is made, concerns of the applicant will be alleviated. However, and as I have just indicated, the respondent’s behaviour has given the applicant no assurance that the financial transactions amongst him, Rita Niessen, and 20 Valley are bona fide.
[66] Based on the materials filed, and despite the responses made by both the respondent and Rita Niessen, I conclude, as did Justice Brown, that the applicant has established a triable issue as to her interest in Victoria Avenue. However, the purpose of a CPL against title to Victoria Avenue is now moot given the transfer of ownership of that property to a third party.
Does the Applicant have a triable interest in Rittenhouse Road?
[67] When Victoria Avenue was swapped for Rittenhouse Road, equal value appears to have been paid by each buyer to each seller.
[68] One might have expected that the ownership interest taken in acquiring Rittenhouse Road would have been the same as the ownership interest in Victoria Avenue, namely one third for each of the respondent and his two parents. However, as noted above, while those three were the sellers of Victoria Avenue, the buyer of Rittenhouse Road was 20 Valley.
[69] I need not review again the circumstances which, to say the least, cast serious doubt on a suggestion that any involvement by Rita Niessen with 20 Valley is other than nominal. What appears to be the case is that the respondent’s one third interest in Victoria Avenue has now been subsumed in the 100 percent ownership of Rittenhouse Road by 20 Valley. If no constraints are placed on dealing with Rittenhouse Road, the applicant can have no assurance that the respondent’s financial interest in that development project will be available to her to fund any part of an equalization payment.
[70] In short, I am satisfied that the applicant has established a triable interest in Rittenhouse Road by her assertion of a claim for an equalization of net family property. Neither the respondent nor Rita Niessen have demonstrated in response that there is no triable issue with respect to whether the applicant has a reasonable claim to the interest in Rittenhouse Road.
Should a CPL issue against Rittenhouse Road?
[71] The next question is whether in all the circumstances of the case it is just to grant the CPL, given the equities amongst the parties.
[72] Normally, a request for a CPL relates to a dispute over the parties’ ownership interest in a property.
[73] In exercising its discretion whether to order a CPL, the court considers matters including but not limited to the uniqueness of the land, whether an alternative claim for damages is available and appropriate, the ease or difficulty of calculating damages (if the property is not preserved), the presence or absence of a willing purchaser, the balance of convenience (that is, the potential harm) to each party, whether the CPL is requested for an improper purpose, whether the interests of the party requesting the CPL can be protected through some other type of security, and whether the moving party has prosecuted the claim with reasonable diligence. See, for example, Lu v. Lu, 2020 ONSC 1110, at para 22.
[74] In a case like this one where the issue is the preservation of an asset for the purpose of making it available to fund an equalization payment, the main focus is on the balance of convenience and the availability of other security.
[75] The position of the applicant is simple: failure to restrict the ability of 20 Valley to deal with Rittenhouse Road will permit the potential dissipation of any equity in that project to which the respondent is otherwise entitled. The history of the respondent in his dealings with the applicant and others is such that he simply cannot be trusted to behave honestly in his financial dealings and may well (through his presumed beneficial control of 20 Valley) put assets out of the applicant’s reach. Rittenhouse Road may be the only property owned either legally or beneficially by the respondent in which there remains appreciable equity.
[76] The respondent and Rita Niessen take the position that putting into place a CPL on title to Rittenhouse Road would create disastrous financial consequences for them causing an interruption, if not cancellation, of the partly finished development project. The CPL would stop the flow of project financing, thereby preventing the payment of suppliers, contractors, and other creditors (including mortgagees). They assert that not only would they lose their respective investments, including as to Rita and Heinz Niessen their expected future home, but that the financial loss would create the result that the applicant seeks to avoid: the loss of the respondent’s ability to fund any equalization payment.
[77] I am sympathetic to the applicant’s concern. She has gone to considerable lengths to analyze the financial information available to her as produced to date by the respondent and Rita Niessen. She points to what she considers to be gaps and inconsistencies. Of course, whether those concerns can be substantiated requires the disclosure sought from the respondent and Rita Niessen. The credibility of the respondent is entirely suspect, based on his actions to which I have already referred, in the apparently fraudulent conveyance of 23rd Street and his other past behaviours. Rita Niessen is closely linked to the respondent, and it appears that she exercises only nominal control over 20 Valley which is actually guided by the respondent. Based on those circumstances, the applicant is justified in her fear that without a CPL, any existing equity in Rittenhouse Road may be dissipated, or put beyond her reach.
[78] There is no information before the court that other effective forms of security are available to the applicant, especially in view of the lack of disclosure provided to date by the respondent.
[79] As to the potential harm to the respondent, his concerns about project interruption are self-inflicted. His dealings with property since the date of separation have been driven by the pursuit of his own best interests without regard to (and sometimes specifically contrary to) the interests of the applicant in her quest to equalize net family property. I note that although the amount of an equalization payment has not yet been established, there seems no doubt that equalization will require a payment by the respondent.
[80] Rita Niessen has been drawn into the web of property development dealings undertaken by the respondent. She does not have property development or financial expertise. Although she may be the legal owner of 20 Valley, she does not appear to be controlling its actions in the Rittenhouse Road project, but rather relying on the advice of the respondent. She is not shown to be part of the frauds committed by the respondent, but by her involvement in the swap of Victoria Avenue for Rittenhouse Road, she is integrally connected to the activities of the respondent.
[81] For the foregoing reasons, I conclude that the issuing of a CPL against Rittenhouse Road is justified, and there will be an order accordingly.
[82] As is obvious, a CPL once granted can be discharged. The respondent and Rita Niessen are able to make a motion for that relief at any time. Their success in doing so may well be linked to the completion of required disclosure showing the availability of other assets, the making of other provisions for security for the applicant, or for other reasons which are to be left for the court to consider at that time. Likewise, the parties can consent to the sale or financing of Rittenhouse Road or any part of it on terms that would ensure the respondent’s ability to fund an equalization payment.
Order for Preservation of Rittenhouse Road and 19th Street:
[83] The applicant seeks a preservation order by way of injunctive relief against Rita Niessen and 20 Valley as to the Rittenhouse Road property.
[84] The applicant also seeks an injunction restraining the respondent, Rita Niessen and 20 Valley from selling, mortgaging, pledging, transferring, assigning, diminishing or otherwise disposing of or dealing in any manner with 19th Street and Rittenhouse Road.
[85] The August 28, 2023 order of Brown J. contains such an order against the respondent for 23rd Street.
[86] Section 12 of the Family Law Act provides that if the court considers it necessary for the protection of the other spouse’s interests under Part I of that Act, it may make an order restraining the depletion of a spouse’s property and for the preservation of the property.
[87] Neither Rittenhouse Road nor 19th Street is the property of the respondent. As a result, no preservation order is available under s. 12.
[88] The court’s general jurisdiction to grant interlocutory injunctive relief is found in s. 101 of the Courts of Justice Act. The applicant relies on rule 40 of the Rules of Civil Procedure.
[89] I was not made aware of, nor could I find in the material filed, an undertaking of the applicant pursuant to rule 40.03 as to damages. Typically, that omission in itself means that injunctive relief should not be granted.
[90] In any event, it is not appropriate for a preservation order or injunctive relief to be granted against 20 Valley in that it is not a party to the proceedings at this point and was not a party to the motion. Although Rita Niessen is a director and officer of 20 Valley, it is not proper to, in effect, pierce the corporate veil and impose an obligation on her as an officer and director that actually relates to the corporation.
[91] Likewise, the request for injunctive relief against the respondent and Rita Niessen personally as to Rittenhouse Road and 19th Street cannot be granted because they appear to have no legal interest in the title to either of those properties.
[92] As a result of the foregoing, the motion for relief as per paragraphs 10 and 11 of the notice of motion is dismissed.
Summary:
[93] Based on the foregoing, there will be an order as follows:
a. On consent, the respondent is to provide the following to the applicant within 30 days:
i. documentation regarding the loan from the respondent’s parents in the amount of $125,000 on December 31, 2018;
ii. documentation regarding all funds loaned from the respondent’s parents to the respondent;
iii. confirmation as to the respondent’s financial partners, if any, including their names and contact information; and
iv. documentation regarding the respondent’s bankruptcy or pending bankruptcy, if any exist, including contact information of its creditors and confirmation as to the amounts owing.
b. The temporary and without prejudice order made on consent during the hearing enjoining Rita Niessen and 20 Valley from encumbering or otherwise dealing with Rittenhouse Road and enjoining the respondent, Rita Niessen, and 20 Valley from encumbering or otherwise dealing with 19th Street and Rittenhouse Road will expire upon the release of this decision.
c. The certificate of pending litigation authorized to be issued and registered on title to Victoria Avenue by the decision of Brown J. dated August 28, 2023 is hereby discharged.
d. Rita Niessen, in her personal capacity and as director of 20 Valley will be added as a party to this application.
e. Oral questioning of Rita Niessen is permitted.
f. Rita Niessen, as director of 20 Valley is to provide to the applicant the disclosure requested in paragraphs 6(a) to (p) of the notice of motion, with the exception of the requests in paragraphs 6(d) and (l), attached hereto as Schedule “A” within 30 days.
g. Rita Niessen and the respondent are to provide to the applicant the disclosure requested in paragraphs 7(a) to (m) of the notice of motion, attached hereto as Schedule “A” within 30 days.
h. A certificate of pending litigation shall issue and be registered on title to the property municipally known as 3446 Rittenhouse Rd., Vineland, ON, having a legal description of PCL 262 – 1 sec M2 Clinton; LT 262 PL M2, confirmed by PL 20BA88, Plan M2 is not a plan of subdivision within the meaning of the Planning Act; Town of Lincoln, bearing PIN 46113 – 0041 (LT) in Land Registry Office # 30.
Costs:
[94] The parties are encouraged to resolve the question of costs consensually.
[95] As indicated at the hearing of this motion, it appears that costs of several previous appearances have been reserved to me as the motions judge. Because of the number of appearances and their outcomes, if there is no agreement, it is appropriate for there to be a short hearing dedicated to the issue of costs.
[96] The parties are to contact the trial coordinator to arrange for a date so that oral submissions on costs can be received, to be argued in the time frame of a short motion. Bills of costs and costs outlines should be filed in advance and uploaded to CaseLines.
Reid J.
Date: December 11, 2023
Schedule “A”
Omitted
[^1]: O. Reg. 114/99
[^2]: RSO, 1990, c F.29
[^3]: RSO 1990, c F.3