Ataei v. Kalantari, 2024 ONSC 6863

COURT FILE NO.: FS-19-13484 DATE: 20241206 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Neda Ataei Applicant – and – Saeed Kalantari Respondent

Counsel: Elena E. Mazinani and Ash Mazinani, for the Applicant Harold Niman, Chloe van Wirdum, and Kaitlyn Zarcone-Beam, for the Respondent

HEARD: April 15, 16, 17, and 18; May 16; and June 3, 2024

Justice J. S. Shin Doi

I. Overview

1The Applicant Neda Ataei (the “Mother”) brings an Application to set aside a separation agreement dated June 15, 2018 (the “Separation Agreement”) on the grounds that she signed it under duress. The Mother alleges that the Respondent Saeed Kalantari (the “Father”) blackmailed the Mother into signing the Separation Agreement. In the alternative, the Mother requests an order to vary the child support and spousal support provisions in the Separation Agreement. The Father opposes setting aside the Separation Agreement because the terms are clear, and the parties had independent legal advice.

2On November 23, 2023, the court ordered a bifurcated trial to proceed on the issue of the validity of the Separation Agreement pursuant to paragraph 1 of the Mother’s Amended Application. The Amended Application, paragraph 1 states that the Applicant seeks an “order setting aside the Separation Agreement or a provision in it, pursuant to s. 56(4)(c) of the Family Law Act, on account of the fact that she signed the Separation Agreement under duress.” A trial on whether the Mother signed the Separation Agreement under duress was held.

3I dismiss the Mother’s Application to set aside the Separation Agreement on the grounds that she signed it under duress. There is evidence that the Mother felt that she was being blackmailed before the Separation Agreement was signed, that the Mother felt pressured by the Father, the Mother was vulnerable, and the Mother found the separation difficult. There is also evidence that the Mother was blackmailed by the Father’s girlfriend after the Separation Agreement was signed. However, there is evidence that the Mother’s vulnerabilities were compensated by her lawyer and that she was not under duress when she signed the Separation Agreement.

II. Background

4The parties started living together in 1989 and were married in Iran on March 1, 1991. The parties have two children, one daughter who was born on July 2, 1995 and is now 29 years old, and a daughter who was born on May 12, 2006 and is now 18 years old.

5The parties moved to Canada in 1997. The Mother worked as a nurse and the Father worked as a physician in 2004. The Mother financially supported the family while the Father completed his medical licensing process in Canada. The Mother did not work from 2005 to 2008 due to childcare responsibilities as well as the fact that the family had to move to Manitoba due to the Father’s work and licensing requirements.

6The Mother was hospitalized in 2015 and diagnosed with Cushing Syndrome. The Mother was under the care of a psychiatrist, Dr. Eve Cabalo of North York General Hospital from October 27, 2015 to August 30, 2018. The Mother was also under the care of a psychiatrist, Dr. Szabo from August 2017 to March 2021.

7One of the physicians who treated the Mother at North York General Hospital was Dr. Safar Zadeh who later entered into a relationship with the Father.

8The parties’ relationship broke down in 2016. The parties separated on March 1, 2017.

9The Father started an Application on March 24, 2017 seeking custody, child support and equalization. The parties entered into a domestic contract dated August 23, 2017 dealing with the listing and sale of the matrimonial home.

10The parties attended a full day mediation in 2017.

11The Father’s counsel sent a draft of the Separation Agreement to the Mother’s counsel on April 30, 2018. The parties entered into the Separation Agreement on June 15, 2018. The parties were represented by senior family law counsel.

12Dr. Zadeh, who was then not treating the Mother, accessed the Mother’s medical file on January 10, 16, and April 18, 2019. The Father and Dr. Zadeh started living together on August 1, 2019 and separated on July 4, 2020. Dr. Zadeh commenced an application against the Father. The Mother loaned the Father the amount of $100,000 to assist him with his legal issues with Dr. Zadeh.

13In October 2019, the Mother commenced her Application.

14The Mother also complained about Dr. Zadeh’s conduct to the College of Physicians and Surgeons including on the issue of threats to disclose the Mother’s personal health information (Ataei v. Zadeh). The College found that Dr. Zadeh committed acts of professional misconduct and suspended her license for five months (College of Physicians and Surgeons of Ontario v. Safar Zadeh, 2023 ONPSDT 8).

III. Law

15The Family Law Act, s. 56(4) provides that a court may set aside a domestic contract as follows:

Setting aside domestic contract

(4) A court may, on application, set aside a domestic contract or a provision in it,

(a) if a party failed to disclose to the other significant assets, or significant debts or other liabilities, existing when the domestic contract was made;

(b) if a party did not understand the nature or consequences of the domestic contract; or

(c) otherwise in accordance with the law of contract. R.S.O. 1990, c. F.3, s. 56(4).

16The Ontario Court of Appeal held in Virc v. Blair et al., 2014 ONCA 392, 119 O.R. (3d) 721, at para. 52, cited in Tadayon v. Mohtashami, 2015 ONCA 777 at para. 33: that in determining whether a domestic contract should be set aside pursuant to s.56(4), the court must follow a two-step process:

1. Has the party seeking to set aside the agreement demonstrated that one or more of the s. 56(4) circumstances is engaged?
2. If so, is it appropriate for the court to exercise its discretion to set aside the agreement?

17This trial deals with whether the Separation Agreement may be set aside in accordance with contract law. Under contract law, the Separation Agreement may be set aside for unconscionability, undue influence, mistake, repudiation, duress, misrepresentation, fraud, and repudiation. The key issue in this case is whether the Separation Agreement may be set aside because the Mother was under duress (s.56(4)(c)). I note that disclosure, which is disputed by the parties, must still be determined separately from this trial (s. 56(4)(a)). If the Mother demonstrates that she was under duress, then the court must consider whether it is appropriate to exercise its discretion to set aside the Separation Agreement.

18Duress is defined in Ludmer v. Ludmer, 2013 ONSC 784 at para. 53 as follows,

Duress involves a coercion of the will or a situation in which one party has no realistic alternative but to submit to pressure. There can be no duress without evidence of an attempt by one party to dominate the will of the other at the time of the execution of the contract. To prove duress, the applicant must show that she was compelled to enter into the marriage contract out of fear of actual or threatened harm of some kind. There must be something more than stress associated with a potential breakdown in familial relations. There must be credible evidence demonstrating that the complaining party was subject to intimidation or illegitimate pressure to sign the agreement.

19Duress can include "coercion, intimidation or the application of illegitimate pressure" (Toscano v. Toscano, 2015 ONSC 487, at para. 72).

20The court must consider the circumstances of negotiation and execution of the Separation Agreement as set out in Miglin v. Miglin, 2003 SCC 24, [2003] 1 S.C.R. 303. Bastarache and Arbour JJ. held at paras. 81 to 83,

81It is difficult to provide a definitive list of factors to consider in assessing the circumstances of negotiation and execution of an agreement. We simply state that the court should be alive to the conditions of the parties, including whether there were any circumstances of oppression, pressure, or other vulnerabilities, taking into account all of the circumstances, including those set out in s. 15.2(4)(a) and (b) and the conditions under which the negotiations were held, such as their duration and whether there was professional assistance.

82…Recognition of the emotional stress of separation or divorce should not be taken as giving rise to a presumption that parties in such circumstances are incapable of assenting to a binding agreement. If separating or divorcing parties were generally incapable of making agreements it would be fair to enforce, it would be difficult to see why Parliament included “agreement or arrangement” in s. 15.2(4)(c). Finally, we stress that the mere presence of vulnerabilities will not, in and of itself, justify the court’s intervention. The degree of professional assistance received by the parties will often overcome any systemic imbalances between the parties.

83Where vulnerabilities are not present, or are effectively compensated by the presence of counsel or other professionals or both, or have not been taken advantage of, the court should consider the agreement as a genuine mutual desire to finalize the terms of the parties’ separation and as indicative of their substantive intentions.

21The significance of counsel or other professionals, as discussed in Miglin, was addressed by Abella J. in Rick v. Brandsema, 2009 SCC 10 at paras. 61 and 62,

61This passage indicates that when vulnerabilities have been compensated for by the presence of professionals, the agreement should be respected. This is an important observation. Given that vulnerabilities are almost always present in these negotiations, the parties’ genuine wish to finalize their arrangements should, absent psychological exploitation or misinformation, be respected. One way to help attenuate the possibility of such negotiating abuses is undoubtedly through professional assistance. But exploitation is not rendered anodyne merely because a spouse has access to professional advice. It is a question of fact in each case.

62In this case, the trial judge found that the wife’s vulnerabilities were not compensated for. On the contrary, he concluded that her emotional and mental condition left her unable to make use of the professional assistance available to her. Moreover, and significantly, he found that her mental instability was well known to her husband.

22In Anderson v. Anderson, 2023 SCC 13, Karakatsanis J. commented that the curative impact of legal advice should not be taken as given at para. 35,

Concern about vulnerabilities may be countered by the presence of procedural safeguards. For example, full and frank disclosure of all relevant financial information between the parties can go far to assuage concerns of informational asymmetry (Rick, at para. 47; Colucci v. Colucci, 2021 SCC 24, at para. 51). Similarly, professional assistance, such as independent legal advice, can serve as a hallmark of a fair bargaining process (Miglin, at para. 82; Rick, at paras. 60-61), although the curative impact of legal advice in the negotiation of domestic contracts should not be taken as given. As La Forest J. recognized, dissenting in Richardson v. Richardson, [1987] 1 S.C.R. 857, divorce is one of the most stressful periods in an individual’s life and many people do “very unwise things, things that are anything but mature and sensible, even when they consult legal counsel” (p. 883). Courts must have careful regard to the financial and emotional pressures that characterized the relationship, and not simply presume that legal advice immunizes a contract from unfairness.

23It is important to note that “vulnerability cannot be equated to duress” (Ramdial v. Davis, 2015 ONCA 726 at para. 42). As held in Ramdial at para. 42, “duress is the coercion of a person’s will through illegitimate pressure, with one party dominating the will of another at the time that a contract is executed: Gordon v. Roebuck (1992), 9 O.R. (3d) 1 (C.A.); Stott v. Merit Investment Corp. (1988), 63 O.R. (2d) 545 (C.A.), leave to appeal refused, [1988] S.C.C.A. No. 185.”

IV. Was the Mother under duress when she signed the Separation Agreement?

24I do not find that the Mother was under duress when she signed the Separation Agreement because of the professional assistance of the Mother’s lawyer. I find that the Mother felt pressured by the Father, was vulnerable, found the separation difficult, and felt that she was being “blackmailed”. However, the Mother’s lawyer ensured that she was not under duress and the Mother’s lawyer compensated for the Mother’s vulnerabilities. Also, I find that the blackmailing by Dr. Zadeh occurred after the Separation Agreement was signed.

25A problem with the Mother’s allegations of duress by the Father and Dr. Zadeh is the sequence of events which is not consistent with the timing of when the Separation Agreement was negotiated and signed. The Mother alleges that at the time the Separation Agreement was signed, she was being blackmailed and threatened by the Father and his partner, Dr. Zadeh. The Mother alleges that the Father and Dr. Zadeh began their relationship in May 2017 when the Father attended Dr. Zadeh’s party. The Father denies that he had a romantic relationship with Dr. Zadeh in May 2017 and states that he spent time at the party hosted by Dr. Zadeh speaking to the Mother on the telephone. The Father and Dr. Zadeh, both of whom were credible, testified that they began dating in December 2018. The Separation Agreement was signed on June 15, 2018 before the Father and Dr. Zadeh began dating.

26The “blackmailing” by Dr. Zadeh occurred after the Separation Agreement was signed. Dr. Zadeh admits that she accessed the Mother’s medical records in 2019 which is several months after the signing of the Separation Agreement in June 2018. Dr. Zadeh then disclosed the Mother’s personal health information to others without the Mother’s consent. Dr. Zadeh sent a text message with screenshots of the Mother’s file to the Father. Dr. Zadeh also sent a Facebook message dated April 19, 2019 to the Mother’s friend, indicating that the Mother was mentally ill. Dr. Zadeh stated that the Mother’s history and what the Mother was doing could be used in a lawsuit against the Mother for harassment and defamation, and used against the Mother in custody proceedings for her younger daughter. Again, these “blackmailing” events occurred after the Separation Agreement was signed.

27In regard to the “blackmailing” by the Father alone, I am persuaded that the Mother felt that she was pressured by the Father, found the separation difficult, and was vulnerable. The Mother states that at the time of signing, she was told that if she failed to sign the Separation Agreement as drafted, the Father would reveal prejudicial confidential information about her medical and psychiatric history to her friends, family, and the broader Iranian community in the Toronto area. The Mother states that the Father was threatening to disclose her psychiatric history and tell people that she was bi-polar, had multiple personality disorder, anxiety, that she was mentally unstable, and that she was unfaithful in their marriage. She further states that the Father threatened to disclose that she was a drug addict who was fired for stealing medication from the hospital. The Mother produced a photograph full of needles and drugs that she says the Father showed her and threatened to disclose to prove that she was a drug addict. The photograph is compelling evidence of the drugs that the Mother was taking at the time and her vulnerability.

28The Father denied “blackmailing” the Mother or taking or using the photograph. The Father described a troubled marriage since 2007. He alleged that the Mother had an affair and that the police became involved. They saw a counsellor and reconciled. The Father stated that the Mother’s health struggles began at that point and gradually worsened through the months and years until their separation. The Father stated that he had supported the Mother’s mental health and attended medical appointments with her. The Father testified that he never blackmailed the Mother. He concedes that he took their daughters away during very stressful times in the summer. The Father’s actions with respect to the children coupled with the Mother’s mental health issues made her more vulnerable.

29The Mother’s mother, Ms. Tahereh Memarian, could not pinpoint the time period when the Mother was under duress. She testified that the Mother was forced to sign the Separation Agreement under pressure and under threat by the Father. However, Ms. Memarian was not able to provide relevant dates. Ms. Memarian stated that “it was during the time she was separated.”

30It is clear that the Mother found the separation difficult. Dr. Ali Khalifeh, who operated botox and filler injection classes that the Mother attended in 2018, testified that the separation was difficult for the Mother. Dr. Khalifeh was a credible witness but had only limited interactions with the Mother.

31The strongest evidence supporting the Mother’s position is the evidence given by Dr. Szabo, a psychologist who treated the Mother from 2017 to 2021. Dr. Szabo wrote in a progress note dated November 7, 2017, “Upset about circumstances of divorce settlement- tried to negotiate – but he is threatening and offering much less than legally warranted. Blackmailing because of my psychiatric history…” Dr. Szabo testified that these were the Mother’s words. The progress note is based on the Mother’s self-reporting to the doctor. Dr. Szabo explained that the Mother suffered trauma of the separation. Dr. Szabo that there were two major themes, the Father “pulling in” the children against the Mother if she didn’t agree with medical treatment and how the Father and his girlfriend trying to harass the Mother by saying she was crazy and unfit. However, there is another note dated February 6, 2018 which reads: “Her [Neda’s] lawyer is reluctant to settle at this time and threatens to resign if she [Neda] settles – He feels that [Neda] is shortchanged, but she is tired and cannot take more acrimony and underhanded requests by husband.”

32While I am persuaded that the Mother felt that she was pressured by the Father, was vulnerable, and found the separation and the negotiating process difficult, I am not persuaded that she was under duress when she signed the Separation Agreement. Based on Mr. Siegel’s evidence, I do not find there existed a situation in which the Mother had no alternative but to submit to the pressure by the Father. I find that the Mother’s vulnerabilities and the pressure that she felt by the Father were compensated for by the professional assistance of Mr. Siegel. Mr. Siegel protected the Mother by refusing to act as her counsel if she wanted to sign an unfair Separation Agreement. The negotiation process was lengthy and the Mother was able to take the time she needed to consider the Separation Agreement before she signed it.

33Mr. Siegel, who was a credible witness, testified that the Separation Agreement was negotiated over a period of time. He explained that there was litigation, pleadings had been exchanged, there was mediation by a terrific mediator, negotiations ensued after that, and letters were exchanged and finally an agreement was signed. Mr. Siegel stated that the Mother did not tell him that she was being blackmailed. He added that if the Mother had told him that she had been blackmailed, he would have made a note in his file or within a letter. Mr. Siegel did describe the Mother as “extremely distraught” for most of his representation of her and “very emotional”.

34Mr. Siegel wrote detailed emails to the Mother confirming his advice not to sign the Separation Agreement “as is”. There were two instances when Mr. Siegel stated that he could no longer represent the Mother because she was not following his advice. Mr. Siegel says bluntly on May 29, 2018, “Once I resign you will [be able] to sign whatever you want. I can’t allow myself to be party to such a situation where you are clearly prepared to sign whatever he wants just to have this over. Sorry. You are free to do whatever you want. I respect that. Equally though, you have to respect if I choose not to be part of it.” The Mother responded, in part, “Please understand my situation and try to end everything in the most easiest way. I appreciate and I don’t want you to resign from my case.” Mr. Siegel then continued to negotiate the Separation Agreement. The Mother listened to Mr. Siegel’s advice, which resulted in more favourable terms for her. Mr. Siegel testified that it was very difficult for him to get the Mother to agree and go along with his advice and that’s always a challenge as a family law lawyer.

35Mr. Siegel wrote to the Mother on June 4, 2018 at 12:58 pm, “I just cannot be part of this deal any longer. I worry you are simply agreeing to whatever Mr. Kalantari wants because you are tired and want it over. While I understand your reasons, I cannot sign off on your agreement. I think he is taking advantage of you and the wording of the agreement is wholly deficient in some parts which I have already detailed to you many times. It is therefore your road to travel on your own should you be happy with it…” The Mother responds after several exchanges, “I don’t feel well. After your email I feel really awful. Please give me 24 hours to collect my thoughts and talk to you.” It is important that the Mother asked for and received 24 hours to collect her thoughts about the Separation Agreement. On June 5, 2018, the Mother then responds that she wants Mr. Siegel to continue and send a letter to the Father’s lawyer including his suggestions about sharing custody, life insurance, and other matters. The Mother followed Mr. Siegel’s advice.

36On June 13, 2018 at 12:17 pm, Mr. Siegel states that he received a revised agreement from the Father’s lawyer and that the Mother is much better off now that they had pushed for the changes. Mr. Siegel further states, “And stop being pressured by them. Take your time and ensure this gets done right. I hope you see that as a result of the letters we’ve sent back you are much better off than had you been had you simply signed 2 months ago.” The Mother then agreed to all of the changes that Mr. Siegel advised her to make except for approximately six changes. The Mother states on June 13, 2018 at 12:40 pm “Dear Brahm, I understand your comments and I know you are trying to protect my rights. But I don’t have any problem with that…Can we please go ahead and finish this now…” The Mother then states at 12:41 pm, “…Plus I should say I don’t have any more money to spend on this case.” The Mother subsequently met with Mr. Siegel on June 15, 2018 and signed the Separation Agreement. Mr. Siegel signed a Certificate of Independent Legal Advice dated June 15, 2018 confirming that the Mother entered into the Separation Agreement of her own volition without any fear, threats, compulsion or influence by the Father or any other person.

37The series of email exchanges between the Mother and Mr. Siegel indicate that the Mother’s will was not dominated by the Father at the time the Separation Agreement was signed. The Mother had the ability and time to consider and make use of Mr. Siegel’s legal advice and professional assistance. The legal advice and professional assistance had a curative impact. The evidence is clear that Mr. Siegel compensated for the Mother’s vulnerabilities through the negotiation and execution process.

38Given my findings, I am not required to proceed to the next step and analyze whether it is appropriate for the court to exercise its discretion to set aside the Separation Agreement.

V. Disposition and Costs

39I conclude that the Mother was not under duress when she signed the Separation Agreement. I dismiss the Mother’s request for an order setting aside the Separation Agreement or a provision in it, pursuant to s. 56(4)(c) of the Family Law Act, on account of the fact that she signed the Separation Agreement under duress. My conclusion and disposition are without prejudice to the Mother to request an order to set aside the Separation Agreement for disclosure which is disputed by the parties.

40If the parties are unable to agree on costs, the parties may submit costs submissions up to five pages in length, double-spaced, within 30 days.