Superior Court of Justice - Ontario

COURT FILE NO.: FS-22-30255 DATE: 20231218

RE: Katerina Janakievska, Applicant/Responding Party AND: Stefan Bogoevski, Respondent/Moving Party

BEFORE: Nishikawa J.

COUNSEL: Nicole Garcia, for the Applicant Melissa A. Samkos, for the Respondent

HEARD: December 12, 2023 (By videoconference)

ENDORSEMENT

Overview

[1] The Respondent, Stefan Bogoevski, brings a motion to set aside or vary certain portions of the final order of Myers J. dated April 3, 2023 (the “Final Order”). Specifically, the Respondent seeks to set aside the provisions relating to: (i) decision-making for the children; (ii) security for child support; (iii) consent for travel by the children; and (iv) the equalization payment calculation.

[2] The Applicant, Katerina Janakievska, takes the position that the Respondent is not entitled have the Final Order set aside because he failed to participate in the proceeding. The Applicant submits that the proper procedural mechanism to vary the Final Order is a motion to change.

[3] For the reasons that follow, the motion is dismissed.

Background

[4] The parties married on July 5, 2014, in Macedonia. They separated on December 17, 2021, but remained in the same home until the Respondent was removed from the home by police on May 2, 2022. The Respondent was charged criminally, but the charges were eventually withdrawn. There are two children of the marriage, ages 6 and 2.

[5] The Respondent did not participate in the proceedings and was noted in default by Kristjanson J. on October 27, 2022. The Applicant was then permitted to proceed in writing to obtain a final order on an uncontested basis.

[6] In the endorsement dated April 3, 2023, Myers J. granted full parenting authority and residence of the children to the Applicant because of “the respondent’s absence from the children’s lives and the fact that the applicant is taking full care of them.” Myers J. further noted that the Respondent “is entitled to exercise parenting time with the children on terms acceptable to the applicant or as may be ordered by the court.” The Final Order provided for, among other things, the following:

(a) Sole decision-making authority to the Applicant;

(b) $995 per month in child support and a proportionate share of s. 7 expenses for the children to be paid by the Respondent;

(c) Dispensing with the Respondent’s consent for the Applicant to travel outside Canada with the children;

(d) Requiring the Respondent to obtain a life insurance policy in an amount sufficient to secure his future child support obligations;

(e) Exclusive possession of the matrimonial home to the Applicant, as well as sole authority to list the home for sale without the consent of the Respondent;

(f) Payment of one-half of the net proceeds of the sale of the matrimonial home (the “Net Proceeds”) to the Applicant;

(g) From the Respondent’s share of the Net Proceeds, payment to the Applicant of the following: equalization of $97,500.00, $11,892.00 for child support arrears, $8,400.00 for post-separation adjustments, and $20,000 in costs of the proceedings;

(h) Any balance remaining in the Respondent’s share of the Net Proceeds after the above deductions were to be held by the Applicant in an interest-bearing account as security for future child support and s. 7 obligations of the Respondent. The Applicant was required to send an annual accounting of the funds to the Respondent.

Analysis

Has the Respondent Met the Test for Setting Aside the Final Order?

[7] The Respondent seeks to set aside certain provisions of the Final Order on the basis of fraud. The Respondent alleges that the Applicant made false and misleading statements in her affidavit sworn December 5, 2022 about the Respondent having left Canada permanently, as further detailed below.

[8] The Applicant denies that she made any false or misleading statements in her affidavit.

The Applicable Principles

[9] In support of his motion, the Respondent relies on subrule 25(19) of the Family Law Rules, O. Reg. 114/99, which provides as follows:

(19) The court may, on motion, change an order that:

(a) was obtained by fraud;

(b) contains a mistake;

(c) needs to be changed to deal with a matter that was before the court but that it did not decide;

(d) was made without notice; or

(e) was made with notice, if an affected party was not present when the order was made because the notice was inadequate or the party was unable, for a reason satisfactory to the court, to be present.

[10] In Gray v. Gray, 2017 ONCA 100, at para. 26, the Court of Appeal held that family law litigants may appropriately rely on rule 25(19) of the Family Law Rules to set aside an order, including one made on an uncontested basis.

[11] Further, in Mountain View Farms Ltd. v. McQueen, 2014 ONCA 194, at paras. 48-50, the Court of Appeal held that in determining whether the interests of justice favour granting an order to set aside a default judgment, the court must consider the following factors:

(i) Whether the motion was brought promptly after learning of the judgment;

(ii) Whether there is a plausible excuse or explanation for the defendant’s default in complying with the Rules;

(iii) Whether the facts establish that the defendant has an arguable defence on the merits;

(iv) The potential prejudice to the moving party should the motion be dismissed, and the potential prejudice to the respondent should the motion be allowed; and

(v) The effect of any order the court might make on the overall integrity of the administration of justice.

[12] The factors are not to be treated as rigid rules but must be considered by the court in the circumstances of the case to decide whether it is just to relieve the defendant from the consequences of their default: Mountainview, at para. 50.

Application to the Facts

[13] As noted above, the Respondent alleges that the Applicant made false and misleading statements to the court in her affidavit in support of her application. The party alleging fraud must prove that the other party knowingly or recklessly made a false statement with knowledge of the falsehood, and did so with wrongful intent: Hatuka v. Segal, 2017 ONSC 5623 at para. 28. The omission of essential facts can be sufficient to set aside the portion of the order to which these facts would apply, even where it cannot be concluded that a party deliberately intended to mislead the court: Cadas v. Cadas, [2013] O.J. No. 2054 at paras. 47 and 48.

[14] The Applicant’s December 5 affidavit states as follows: “In light of the respondent’s default in these proceedings, and his withdrawal from the country, and from any further family responsibility, I seek an order permitting me sole discretion and responsibility for the listing and sale of the matrimonial home…[.]” The Applicant further stated that the Respondent had “made it clear in his past communications to me, as well as his actions post separation that he has no intention whatsoever to voluntarily pay his child support obligation whether now or in the future.”

[15] The Respondent submits that when the Applicant swore the affidavit, she knew that he had returned to Canada because they exchanged email about his request to see the children. The Respondent submits that his return to Canada was a material fact that the Applicant should have brought to the attention of the court, as it was highly relevant to the issues of decision-making, parenting-time, child support and security for support. The Respondent denies having ever communicated that he had no intention to pay child support and notes that the Applicant failed to support her statement with documentary evidence.

[16] In his affidavit in support of this motion, the Respondent attached a couple of email messages exchanged between November 6 and December 3, 2022. In the email messages, the Respondent requests on a few occasions that the children be brought to a park or other location so that he may see them that day. The Respondent had left for Macedonia in late June or early July 2022 and returned on October 29, 2022.While it is clear that the Respondent was in Canada at the time, the email messages do not state that the Respondent has returned to Canada permanently or how long he is staying.

[17] In addition, the Respondent states that he asked the Applicant to send him a copy of his employment contract so that he could secure a rental property. The email attached to the Respondent’s affidavit, however, is dated October 22, 2023 and addressed from the Respondent to the Respondent, and states only that “I need the contract from work to rent an apartment, please scan it or copy it and send it to me as soon as you can.” There is no indication that the email was sent to the Applicant. Moreover, even if it was, it does not state where the Respondent was seeking to rent an apartment, whether in Toronto or elsewhere.

[18] On this motion, the Respondent has provided little evidence of the length of time he has been in Toronto. He did not provide a copy of his lease agreement for the basement apartment where he is staying. While he appears to have had the same job since 2016, he has not provided the employment contract or any particulars about the terms of his employment. Moreover, the Respondent has been able to spend extended periods in Macedonia in 2022 and again in 2023 despite his employment.

[19] The Respondent’s previous counsel advised the Applicant on June 30, 2022 that the Respondent had returned to Macedonia for an “undetermined amount of time.” He then dismissed his counsel and stopped participating in the proceeding. While the Respondent was present in Canada in November to December 2022, there is no evidence to suggest that the Applicant knew that he returned to Canada permanently. Indeed, he left for Macedonia again in July 2023 and remained there until September 2023. Moreover, the relief granted in the Final Order was not based on the Respondent’s absence from Canada. In the endorsement, Myers J. found only that the Respondent “may have left Canada permanently.”

[20] Similarly, the Respondent has not satisfied me that the Applicant’s statement regarding his lack of intention to pay child support was false or misleading. At the time, the Respondent was not paying any amount toward supporting the children or the expenses on the matrimonial home.

[21] In my view, the Respondent has not met the high bar to establish that the provisions of the Final Order regarding decision-making authority, travel by the children, and security for child support should be set aside for fraud. The Respondent has not satisfied me that the Applicant knowingly or recklessly made any false or misleading statements in her affidavit or that she omitted essential facts.

[22] In addition, the Respondent has not demonstrated that the factors that the court considers in determining whether to set an order aside a default order weigh in his favour.

[23] First, the Respondent did not bring the motion promptly after he was made aware of the Final Order. The Respondent admits that he received the order in April 2023. He did not bring this motion until November 2023. The Respondent submits that the first few months were spent trying to obtain court documents and to seek a resolution with the Applicant. However, the Respondent then left for Macedonia where he remained from July to September 2023. The Respondent deposes that he went to Macedonia to take care of his mother, who was ill, but has provided no further information as to the nature of her illness or why he remained there for that period of time.

[24] Second, the Respondent has not provided a plausible excuse or explanation for his default in complying with the Rules. The Respondent submits that he was unable to participate in the proceedings because he became depressed after he was charged criminally and that he departed for Macedonia because he had no family support in Canada. The Respondent has submitted a medical note from a doctor in Macedonia that has been translated into English to support that he had depression and anxiety.

[25] In Lucreziano v. Lucreziano, which also dealt with a motion to set aside an order under Rule 25(19), Nakonechny J. noted as follows:

[49] Rule 14(19) allows for hearsay only in restricted conditions. The case law identifies potential issues with the admissibility of the doctors’ letters attached to a party’s affidavit. In some cases, courts have rejected unsworn doctor’s letters as inadmissible because the letters contained no evidence as to the doctor’s qualifications and there was no opportunity to cross-examine the doctor. While a doctor’s letter or report will not be excluded solely because it is not in the form of an Affidavit, the Court must be satisfied of the truth of the facts contained in the letter or report: Ceho v. Ceho, 2015 ONSC 5285, Kozak v. Kozak, 2018 ONSC 690.

[26] Assuming, without deciding, that the doctor’s note is admissible, it would not be sufficient to explain the Respondent’s default. The note provides no specifics as to the extent or length of the Respondent’s illness and provides no link to his inability to respond to the family law proceedings. In addition, the Respondent has submitted no medical documentation from a doctor or health practitioner, in Canada or otherwise, for the period after he returned. The Respondent failed to respond to the proceeding from the outset, in early 22022, and his default continued long after his purported return to Canada. Moreover, at no time did the Respondent advise the Applicant or her counsel that he was unable to participate in the proceedings because of a mental health disability, including in the letter from his counsel advising that he had left Canada.

[27] Third, in my view, the Respondent has not demonstrated an arguable defence on the merits. Given his lengthy absences from Canada, despite having two small children who require significant medical care, it is not clear to me that shared decision-making authority would have been granted. While he states that he was in communication with the Applicant about the children while he was in Macedonia, this statement is unsupported by any email or other documentary evidence. In addition, as noted above, the Respondent failed to pay any child support until the Final Order was made. As a result, it is not clear to me that security for child support would not have been ordered even if he had participated.

[28] Fourth, I do not accept that the potential prejudice to the Respondent warrants an order setting aside the specified provisions of the Final Order. The Respondent submits that the Final Order causes him significant prejudice because he is unable to receive his share of the Net Proceeds and, as a result, is unable to re-establish himself. The Respondent states that he is living in a basement apartment where there is insufficient space to have parenting time with the children. The prejudice to the Respondent is a consequence of his failure to participate in the proceeding. As noted by the Court of Appeal in Hilton v. Hilton, 2021 ONCA 29, at para. 10, “when a party does not participate in the process, things tend not to go well[.]” Had the Respondent participated before the Final Order was made, he would have had the opportunity to adduce evidence to support his position.

[29] I note that the endorsement of Myers J. states that “the respondent is entitled to exercise parenting time with the children on terms acceptable to the applicant or as may be ordered by the court.” To the extent that parenting time is contemplated, the Respondent is not prejudiced by the Final Order.

[30] By contrast, the Applicant spent time and money to comply with her obligations in the proceeding. She will be prejudiced if after having gone through those efforts, the Final Order is set aside and she is required to relitigate matters, such as decision-making authority, that have been resolved in her favour.

[31] Fifth, the overall integrity of the administration of justice does not weigh in favour of changing or setting aside the provisions of the Final Order that the Respondent seeks to change. Parties to family law proceedings must understand that they are required to participate in the proceeding and to follow the applicable rules, and that if they fail to do so, the resulting order will nonetheless apply to them. Bringing a motion to set an order aside after all the procedural steps have taken place, because a party failed to participate, requires additional time and resources from the court to repeat those steps, which inevitably takes away from other family law litigants.

Should the Final Order be Rectified in Respect of Equalization?

[32] The Respondent seeks to change the provision of the Final Order regarding the equalization payment to the Applicant based on a miscalculation. Specifically, paragraph 6(c) of the Final Order provides for an equalization payment to the Applicant of $97,489.61.

[33] In her December 5 affidavit, the Applicant stated that based on the net family property statement, the Respondent would owe her an equalization payment of approximately $97,500.00. However, the Applicant further stated that: “[a]ssuming I get the 2010 Audi A6 vehicle, worth about $11,500 on separation, the respondent would owe a balance of $86,000.” Elsewhere in the affidavit, the Applicant acknowledged that the Respondent should be credited for the value of the vehicle, if transferred, when calculating equalization of net family property.

[34] Given this evidence, it appears that the Final Order inadvertently provided for an equalization payment of $97,489.61, as opposed to $86,000. The Applicant now states that the error need not be corrected because the Audi remains in the Respondent’s name and she is content for him to collect it at any time, however, this further demonstrates that the amount was incorrect. The Applicant cannot receive both the higher equalization amount and keep the vehicle.

[35] Rule 25(19) permits rectification of an order where: (a) the order does not reflect the common intentions of the parties due to a mistake; (b) there are grounds to rectify the order similar to those necessary to rectify a contract; and (c) it is in the interests of justice to rectify the order: Henderson v. Henderson, 2015 ONSC 2914, at para. 108.

[36] As a result, given that the equalization payment of $97,489.61 resulted from a mistake, paragraph 6(c) of the Final Order should be amended to reflect an equalization payment of $86,000. For the purposes of consistency and clarity, ownership of the Audi should be transferred to the Applicant’s name.

Conclusion

[37] The motion is dismissed, except in respect of the inadvertent error regarding the equalization payment, which should be $86,000.

Costs

[38] Costs awards are discretionary. Two important principles in exercising discretion are reasonableness and proportionality: Beaver v. Hill, 2018 ONCA 840. Rule 24(1) of the Family Law Rules creates a presumption of costs in favour of the successful party. An award of costs is subject to: the factors listed in Rule 24(12), Rule 24(4) (unreasonable conduct of a successful party), Rule 24(8) (bad faith), Rule 18(14) (offers to settle), and the reasonableness of the costs sought by the successful party: Berta v. Berta, 2015 ONCA 918at para. 94.

[39] The Applicant submitted a bill of costs for a total of $11,850.88 on a full indemnity basis, including HST and disbursements. The Respondent’s costs on a full indemnity basis were $8,934.57, all-inclusive. In my view, there is no basis for full indemnity costs. While I have dismissed the motion on the basis that the Respondent failed to demonstrate fraud by the Applicant, the high threshold of bad faith or egregious behaviour in the conduct of the proceeding has not been met.

[40] In fixing costs, I must determine what is fair and reasonable and balance compensation of the successful party with the goal of fostering access to justice. I have considered the factors set out in Rule 24(12) of the FLR. Based on the parties’ behaviour, the issues, and their complexity, I fix the Applicant’s partial indemnity costs of the motion at $6,500.00, including disbursements and HST.

Disposition

[41] I make the following Order:

(a) The Respondent’s motion to set aside the Order of Myers J. dated April 3, 2023 is dismissed;

(b) Paragraph 6(c) of the Order of Myers J. is amended to reflect an equalization payment owing from the Respondent to the Applicant in the net amount of $86,000.00;

(c) The Respondent shall pay the Applicant her costs of this motion fixed in the amount of $6,500, inclusive of disbursements and HST, in 30 days.

“Nishikawa J.”

Date: December 18, 2023