ruling on motion

Hebner j.

1This application was commenced in March of 2016. It is now nine years old and nowhere close to a resolution. The major outstanding issue between the parties is the applicant’s claim to an equalization of net family property.

Background Facts

2I set out the facts of this case gleaned from the various affidavits that have been filed on motions before me.

3The applicant and respondent were married on January 7, 1995. The applicant claims the date of separation to be April 15, 2015. The respondent claimed the date of separation to be April 15, 2014. I am told the parties now agree on a separation date of April 15, 2015.

4The parties have one child, Allan Riley, born October 26, 1995. At the time the action was started, Allan was a student at the University of Windsor. At this time, parenting and child support are no longer in issue.

5When the parties started their relationship, the respondent was operating her own mattress store in Oakville. The applicant was one of her suppliers.

6The respondent asserts that throughout their relationship and marriage, the parties operated separate businesses, although they did work together and cooperate. They had separate finances. This continued until the separation.

7The applicant made an assignment in bankruptcy in 2009 claiming debts of $353,125 and assets of $2,000. The respondent asserts that she was aware of the applicant ceasing his business operations in 2009 but she was not aware that he had filed for personal bankruptcy.

8At the time the parties separated, the respondent owned the matrimonial home located at 486 Russell Rd. in Tecumseh, Ontario. She also owned four numbered companies, two of which owned premises in the Windsor area (416 Advance Blvd. and 2570 Ouellette Ave.), one of which owned two vehicles, and one of which owned a retail business called Riley’s. Riley’s operated a furniture and appliance store out of one of the premises owned by one of the numbered companies.

9The applicant was employed in the furniture store owned by the respondent at the time of the marriage breakdown. The respondent asserts that the applicant was stealing from the business and so terminated his employment in March of 2016.

10The applicant originally claimed a trust interest in the assets owned by the respondent. I am told that, at this point, the issue is limited to an equalization of net family property.

The Motions

11The respondent had two motions before me. They were as follows:

Motion dated November 18, 2020 and first returnable November 27, 2020. The motion was for an order finding the applicant in contempt of my orders dated September 15, 2016, July 30, 2018, August 17, 2018 and September 11, 2018 and striking the applicant’s pleading;
Motion dated June 7, 2021 and first returnable on June 28, 2021. The motion was for an order that the applicant’s pleadings be struck for non-compliance with orders.

12The applicant’s motion was dated June 23, 2021, originally returnable June 28, 2021. It was for an order restraining the respondent from depleting her net family property along with the following relief:

The right to obtain his own appraisal of the matrimonial home;
Copies of the appraisal of 2570 Ouellette Ave. and 416 Advance Blvd. referred to in the respondent’s business valuations prepared by Mr. J. Tracy;
The cooperation of the respondent with the applicant’s business valuator, Federica Nazzani of Capital Assist Valuations; and
The sale documents of 416 Advance Blvd.

13The respondent asserts the following: that she has provided an appraisal of the matrimonial home as at the date of separation and at present and that she has no issue if the applicant wishes to obtain his own appraisal; that she provided an appraisal of the property at 2570 Ouellette Ave. as at the date of separation and at present; that she provided an appraisal of the property at 416 Advance Blvd. as at the date of separation and at present; that she has provided the sale documents of 416 Advance Blvd.; and that she has provided all bank statements that were ordered. She asserts that the only other request made by the applicant was for the respondent’s business valuator to cooperate with the applicant’s business valuator to provide whatever the applicant’s valuator needs to prepare her own business valuation. The respondent asserts that she has not complied with this request because the applicant has not complied with the many orders for disclosure against him. The respondent asserts that there has been no reciprocity in the disclosure made and that the applicant has not complied with disclosure orders. In these circumstances, the respondent asserts that she ought not to be required to spend more money to have her business valuator provide information directly to the applicant’s business valuator.

14She asserts that the request by the applicant to obtain his own real estate appraisal of the matrimonial home was only made on the day of the motion.

15Much of the time was spent on the respondent’s motion to strike the applicant’s pleadings. The respondent had prepared a chart outlining her assertions of the applicant’s breach of disclosure orders. On March 31, 2023, I adjourned these motions and directed counsel to meet and review the productions together. The meeting and review took place. The resulting chart became the focus of the respondent’s argument on her motion to strike.

Orders Made

16I made numerous orders for disclosure throughout the litigation. Many of the orders were made to facilitate the respondent’s plan to conduct a forensic accounting of the applicant’s accounts to determine the movement of monies. I focus on those orders that required the applicant provide certain disclosure to the respondent as set out in the chart.

Order of September 15, 2016

17The applicant was ordered to provide the following:

a. copy of his bankruptcy filing in 2009;

b. copies of bank statements for all accounts retroactive to 2009 (or as early as possible if records back to 2009 are unavailable) (both parties to provide);

c. Income tax returns and notices of assessment for the last five years (reciprocal).

Order of August 17, 2018

18The applicant was ordered to provide the following documents by September 5, 2018:

a. a bank transaction history on January 1, 2015 to the date of the order for CIBC account ending in 9597;

b. a copy of the Ford credit application for the 2016 Ford F-150;

c. a copy of the plane tickets, as well as a copy of the receipts for their purchase, for trips taken in 2014 and 2015;

d. a copy of all credit card statements for 2015 and 2016;

e. a copy of the service call documentation and payment from Mr. Rooter;

f. a copy of all financing applications with TD Canada Trust since 2010;

g. a letter verifying the applicant paid $50 per day for rent.

19The applicant was ordered to provide a copy of all monthly bank account statements that are required of him pursuant to my order dated September 15, 2016 by September 5, 2018:

a. President's Choice financial account number is 0074197799 from September 1, 2011 through September 15, 2016;

b. CIBC account number 83-14799 from April 1, 2016 through September 15, 2016;

c. CIBC account number 83-3957 from September 1, 2011 through September 15, 2016;

d. WFCU member number 825-8980 (savings 13) from September 1, 2011 through September 15, 2016;

e. WFCU member number 8258980 (pkg3) from September 1, 2011 through September 15, 2016;

f. TD Canada Trust account number 6521228 from April 1, 2016 through September 15, 2016;

g. TD Canada Trust account number 7168649 from March 31, 2016 through September 15, 2016.

20The applicant was ordered to provide a copy of the following additional documents by September 5, 2018:

a. Mercedes-Benz loan application contained at page 2 list of liabilities in the mortgage application with Fisgard;

b. the final contract with Lakeland Homes, with all attachments thereto, including but not limited to deposit receipts and contract/costs for all add-ons such as sod, driveway, basement, lighting cable and utility hook-ups, etc.;

c. Trust Statement from the solicitor for the purchase of the home municipally known as 336 Lakewood Street, Tecumseh, Ontario;

d. a copy of the bank account statements for all transactions related to the build and purchase of the home, including but not limited to the downpayment and any monies paid to either Lakeland Homes or the real estate solicitor;

e. copy of credit application for Lowe's account #6045 9010 0431 9425;

f. a copy of the credit application file from Evalon Merchant Services;

g. a copy of the lease agreement for each of 567 Wyandotte, 2680 Ouellette, 170 Edinborough and the Talbot Street Leamington location of Original Mattress;

h. a copy of all hydro and utility deposits for each of 567 Wyandotte, 2680 Ouellette, 170 Edinborough and the Talbot Street Leamington location of Original Mattress;

i. a copy of all advertising contracts and payment for same from AM 800, CTV, Bell Media, and 96.7 Blackburn Radio;

j. copy of all merchandise equipment/purchase invoices for each of 567 Wyandotte, 2680 Ouellette, 170 Edinborough and the Talbot Street Leamington location of Original Mattress from the date of the respective property lease to present;

k. a copy of all monthly financial statements for each of 567 Wyandotte, 2680 Ouellette, 170 Edinborough and the Talbot Street Leamington location of Original Mattress from the date of opening until present;

l. a copy of all monthly bank statements for Original Mattress from the date of opening until present;

m. a copy of the business tax returns for Original Mattress for 2016 and 2017;

n. a copy of the signage contract and payments for same for each of 567 Wyandotte, 2680 Ouellette, 170 Edinborough and the Talbot Street Leamington location of Original Mattress from the date of the property lease to present;

o. a copy of the Articles of lncorporation and business name registrations made by the applicant since April 2016 including but not limited to Original Riley's and Original Mattress;

p. a copy of leasehold and equipment improvements for 170 Edinborough;

q. a copy of the applicant's SkyMiles account with Delta Airline from April 2016 to present;

r. business valuations for each of the business locations in Windsor and Leamington operating Original Mattress.

Order of September 11, 2018

21The order required the parties to disclose to each other the following:

copies of any corporate minute books for any corporation owned in whole or in part, directly or indirectly, by the parties at any point from 2014 to present;
annual financial statements prepared by external accounts for any business (corporation or unincorporated business) owned in whole or in part, directly or indirectly, by the parties for fiscal years from 2014 to present, inclusive;
T-2 federal corporate income returns and all related schedules and attachments for any corporation owned in whole-or in part, directly or indirectly, by the parties for fiscal years from 2014 to present, inclusive;
Canada Revenue Agency (“CRA”) corporate Notices of Assessment and Re-Assessment for any corporations owned in whole or in part, directly or indirectly, by the parties for fiscal years from 2014 to present, inclusive;
correspondences to/from CRA for any corporation owned in whole or in part, directly or indirectly, for the parties from 2014 to present, inclusive;
details of any CRA income tax or GST/HST audits for any corporations owned in whole or in part, directly or indirectly, by the parties for fiscal years 2014 to present, inclusive;
copies of business insurance policies covering assets and operations for any businesses (incorporated or unincorporated) owned in whole or in part by the parties, directly or indirectly, for the fiscal years 2014 to present;
copies of personal insurance policies covering all personal assets of the parties for the fiscal years 2014 to present;
GST/HST quarterly/annual filing reports for any business owned in whole or in part by the parties, directly or indirectly, for the fiscal years 2014 to present;
the name, address and phone number of a contact person for external accountants that act for the parties personally or for any business owned in whole or in part, directly or indirectly, by the parties for the fiscal years 2014 to present, inclusive:
the names and contact information for any other accounting firms used by the parties in the time period from 2014 to present, inclusive, for either personal or business matters;
copies of all invoices from all accounting firms acting for the parties and businesses they owned in whole or in part, directly or indirectly, from 2014 to present, inclusive;
copies of annual T4 Summary of Renumeration Paid and all T-4 slips for any businesses (corporations or unincorporated) owned in whole or in part, directly or indirectly, by the parties for the fiscal years 2014 to present;
copies of annual T5 Summary and T-5 slips for any corporation the parties have owned all of or part of, directly or indirectly, for the calendar years 2014 to present;
documents relating to any loans to/from any family members or friends from 2014 to present;
if the parties have owned part of any business (incorporated or unincorporated) since 2014, inclusive, the names, addresses, phone numbers and percentage of ownership of the other owners;
full addresses of any warehouses where the parties store inventory for any of the above noted businesses and, if not owned by the parties, the name of the warehouse owner.

22The order required the applicant to produce to the respondent the following:

Details of all financial and real estate transactions the applicant has been involved in with the following individuals:

Aleksandra Kowala
Orieta Grant Holmes
Kevin Campbell
Barrington Hill
Tanya Hill
Ngom Sun
Barrington McLune.

Copies of all rent/room and board receipts from Aleksandra Kowala for monies paid by the applicant while staying with her.

Respondent’s Motion to Strike

23The respondent’s motion to strike the application is grounded in her assertions that the applicant has not complied fully with the disclosure orders summarized above.

24As previously indicated, counsel met with each other on May 3, 2023 to review the list of outstanding disclosure items prepared by Ms. Beaumont. The respondent then filed an affidavit dated May 15, 2023 setting out the items that she asserts are still outstanding.

The Respondent’s Disclosure Complaints

25I will outline the alleged deficiencies in the applicant’s disclosure as it stood when the motion was argued:

a. The applicant was required to provide statements for his account with PC Financial ending in 7823. The bulk of the statements were provided on May 2, 2023, although the original order for bank statements was made in August of 2018. The August 2013 statement is still missing with no explanation.

b. TD account ending in 0072: Statements were provided for March 28, 2011 to December 31, 2011; February 7, 2012 to March 30, 2012; April 27, 2012 to June 25, 2012; November 30, 2012 to December 31, 2012; all of 2013 and 2014, and the start of 2015 to April 16, 2015, when the account was closed. There was no explanation for the missing statements of December 2011 and January, April and June - November of 2012. The respondent asserts that the applicant chooses what statements he will disclose as opposed to providing them all.

c. TD account ending in 4277: No statement for date of separation provided.

d. CIBC account ending in 4780: Statements provided for August 30, 2014 - March 3, 2015 only. The account appears to have been inactive during that period. The applicant claims the account did not exist at the date of separation, but no evidence of the account being closed was provided. No statements predating March 2014 were provided.

e. TD account ending in 1228: Account opened in August 2013. The statements missing are September 2016 - August 9, 2017, and September 2, 2017 - June 23, 2019.

f. Ford Credit application: The applicant purchased a Ford Truck from Rose City Ford on August 17, 2016. He traded in his vehicle and financed $21,131.04. He made enquiries of the dealership and was told they did not have a credit application. There is no evidence that the applicant contacted Ford Credit or other credit facilities.

g. TD VISA ending 8740: The January 17, 2015 statement shows a balance forward evidencing the prior existence of the account, but no prior statements were provided. Statements were not provided for July 14, 2015 - August 2018 (save for three specific statements dated September 26, 2016, November 8, 2016 and September 10, 2018). Of note is that no statement is provided for the date of separation.

h. TD USD Visa ending in 3713: The February 2015 statement provided shows a balance forward evidencing the prior existence of account, but no prior statements were provided. Statements are missing from June 2015 onward, with the exception of three specific statements dated September 26, 2016, November 8, 2016 and September 10, 2018.

i. RBC MasterCard ending in 7072: The applicant provided a single statement for July 24, 2018, which indicates a balance forward evidencing the prior existence of the account. No prior accounts were provided.

j. TD credit applications for credit since 2010: The applicant claims to have a TD merchant credit obtained in 2018. He did not provide a copy of the application for credit.

k. TD account ending in 0110: This account had a balance of $49,852.35 as at April 2013. No statements have been provided. The applicant asserts that the account was a joint account with either the respondent or their son and that the account did not exist on the date of separation. The applicant suggests that the respondent obtain the statements from the parties’ son.

The parties’ son, Allan Riley, filed an affidavit dated July 10, 2017. He said he attended at TD Canada Trust and requested a printout of all accounts that bore his name. He was given a statement for an account that he had no knowledge existed. It appeared to be a joint account between Allan and the applicant. The statement indicated that in April of 2014, the balance was $44,695.81. Allan said these were not his monies, he did not know of the existence of the monies, and he did not withdraw any of the monies.

l. 336 Lakeland Street documents: The applicant was required to provide a copy of all documents related to the purchase/build of the home, including bank statements evidencing all associated transactions. He has provided only bank statements of his common-law spouse, Ms. San, evidencing that she had sufficient monies in her bank account to make most of the payments. The applicant has provided contracts with the builder and a copy of the lawyer’s trust ledger but not bank statements evidencing where the monies came from for the installment payments. The statements provided do not disclose this information.

m. Lowe’s credit application: The respondent claimed not to have a Lowe’s account. He said he “apparently” obtained one after the date of separation but claims not to have filled out a credit application. There is no indication that he contacted Lowe’s to make enquiries.

n. TD account ending 3030: Following the parties’ separation, the applicant appears to have opened a new business called “Original Riley’s” or “Original Mattress” at two locations: 2680 Ouellette Ave and 170 Edinborough St. This is an account owned by Original Riley’s. The applicant originally claimed that the business belonged to his stepdaughter, Orieta Holmes, but now concedes the business is his. Bank statements were provided, but many are missing. The August 2016 statement shows a balance forward of $4,155.77, but previous statements were not provided; there are several statements missing from 2016 and 2017.

o. TD account ending in 1988: This was an account owned by Original Riley’s. The applicant provided one statement only, being the August 31, 2016 statement. No other statements were provided for 2016, and nothing was provided for 2017 and 2018.

p. Delta SkyMiles: No statements provided. The applicant said he was unable to obtain documentation, but no third-party records motion was brought.

q. The applicant has not provided any business valuations for his business, claiming that the business was owned by Orieta Holmes at the time of the separation.

r. The applicant did not provide any personal insurance policies, including his home insurance and car insurance policies.

s. Accountant Invoices: The applicant provided some invoices, but they were incomplete. As an example, he provided invoices for 2016 totaling $1,337 while the annual financial statement claimed accounting fees of $2,535.

t. No date of separation statements were provided for: a WFCU account ending in 8980; Scotia Visa accounts ending in 2485, 0525 and 0295; a TD USD account ending in 8649.

u. Missing statements for TD merchant accounts for Original Riley’s ending in 5525 and 2768.

v. Windsor Family Credit Union: The applicant claims to have produced “all relevant statements”, but the orders require that he produce all statements.

w. Merchandise purchase invoices: The applicant has provided only a handful of invoices, and they do not coincide with the information in the business tax returns.

x. Signage Contracts: The applicant provided only one record of a transaction related to the purchase of a sign logo change that appears to come from an accounting software. The applicant claims not to have been involved in Original Riley’s, although the signs read, “by Winston Riley”.

y. Advertising Contracts: The applicant swore that there were no contracts to produce and there were no advertisements with Blackburn Radio. However, there is an email exchange between the applicant and Blackburn Radio setting out that he was given 60 commercials with payment to be made monthly. In an affidavit sworn in 2018, the applicant said, “I have spent approximately $14,000 with Blackburn Radio and approximately $27,000 with CTV”.

z. Receipts for Leasehold Improvements: The applicant swore there were none other than a door paid for by the landlord, but the Original Riley’s corporate tax returns for 2016 and 2017 claim $2,997 and $567, respectively, for leasehold and equipment improvements.

aa. Business credit card statements: The applicant had a TD VISA card ending in 8740 and an RBC MasterCard ending in 7072. These were not produced. Rather, the applicant claimed that the cards “were used in the Original Riley’s business”.

bb. The respondent discovered an account with RBC ending in 4274 on reviewing a related document produced by the applicant. He has not produced statements, saying “This is not a personal account. I believe it was opened in 2017. The account is no longer open.”

26The applicant did not bring motions for third-party records. There was no evidence that the applicant attended at banks to request statements.

Inconsistencies

27The applicant’s affidavit materials are rife with inconsistencies. I will refer to some of the more problematic ones.

Original Riley’s

28The applicant said Original Riley’s was owned by his stepdaughter and he had nothing to do with it. He denied being employed by Original Riley’s or receiving income from it. Then, he said that he managed the business until October of 2018 and, in November of 2018, purchased the merchandise and inventory and opened his own business to carry on the operations.

29He said that Orieta borrowed $45,800 from her godmother for the business. He then said that the monies were given directly to him and he managed the business until he took it over in 2018.

30Another time, he said he was the one who borrowed the money. He said, “In order to open my business located on Ouellette Avenue I borrowed $45,800 USD on July 22, 2016 from my step-daughter’s grandmother who resides in Virginia. I used those funds to open my business.” On yet another occasion, he said he had nothing to do with the business, and that “I worked for and was helping my daughter Orieta in her business she started in August 2016 as Original Riley’s”.

31On another occasion, the applicant said that his daughter borrowed the $45,800 and he “guaranteed the loan”. He said the monies were paid directly to him. There is no evidence that the loan was repaid.

32The applicant refused to produce any documentation relating to the loan or the business called Original Riley’s. He said, “It is my position that none of those documents would be relevant since from August 2016 to October 2018 I managed a business owned by someone else and then commenced my own business in November 2018”.

Original Mattress

33He said that Original Riley’s and/or Original Mattress were not his businesses and he had nothing to do with them. He said the business was his brother’s. On another occasion, he said the business was opened in the name of his nephew. The billboard advertising Original Mattress was inconsistent with this assertion. The applicant later said that he supplied the mattresses to the business and allowed the use of the “Original Mattress” name.

Bankruptcy

34The applicant made an assignment in bankruptcy in 2009 and was discharged June 29, 2010. At the time of the bankruptcy, the applicant had $190,000 in cash that appears not to have been disclosed to the trustee. He said he kept cash in the basement.

Legal Principles

35Parties to a family law case come to court to seek a fair and just determination of their disputes. Rules 2(2), (3) and (4) of the Family Law Rules, O. Reg. 114/99, require that participants in a family law proceeding have a duty to promote a fair, efficient, proportional and just outcome. The rules provide as follows:

PRIMARY OBJECTIVE

(2) The primary objective of these rules is to enable the court to deal with cases justly.

DEALING WITH CASES JUSTLY

(3) Dealing with a case justly includes,

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

(b) saving expense and time;

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

DUTY TO PROMOTE PRIMARY OBJECTIVE

(4) The court is required to apply these rules to promote the primary objective, and parties and their lawyers are required to help the court to promote the primary objective.

36Early, voluntary and complete disclosure of financial information is essential. Justice Czutrin articulated the principle clearly in Blaney v. Blaney, 2012 ONSC 1777, 19 R.F.L. (7th) 491, at paras. 3-5 , as follows:

3The Family Law Rules that first came into effect in 1999 had as its objective, promotion of settlement and early disclosure. It created a process that would allow early access to judges. The process was and is still dependent on readiness and parties and counsel being able to use the judicial time appropriately. Far too often, little, particularly where the issues are financial may be achieved, if disclosure remains an issue.

4Soon after parties separate, or perhaps even in anticipation of separation, parties no doubt look for information about the process and what is required of them. If they consult family counsel they will be advised that they need to start gathering documentation to deal with property and support issues.

5Particularly where a party is self-employed, or is a shareholder of a company and works for that company they should know that, for support purposes, their Income Tax Returns may not be enough to establish income and that the value of their interests in a company will need to be established by the use of and need for experts in many instances. The obligation and onus to satisfy the court as to income and the value of assets and debts is on the person whose income or asset or debt is called into question. Here, the Respondent (husband) had that obligation. His obligation existed prior to any court orders, conferences or court attendances.

37When disclosure orders are made and not complied with, the remedies are set out in r. 1(8):

1(8) If a person fails to obey an order in a case or a related case, the court may deal with the failure by making any order that it considers necessary for a just determination of the matter, including,

(a) an order for costs;

(a.1) an order to pay an amount to a party or into court as a penalty or fine;

(b) an order dismissing a claim;

(c) an order striking out any application, answer, notice of motion, motion to change, response to motion to change, financial statement, affidavit, or any other document filed by a party;

(d) an order that all or part of a document that was required to be provided but was not, may not be used in the case;

(e) if the failure to obey was by a party, an order that the party is not entitled to any further order from the court unless the court orders otherwise;

(f) an order postponing the trial or any other step in the case; and

(g) a contempt order, if sought under rule 31.

38The importance of disclosure in family law cases is articulated by Benotto J.A. in Roberts v. Roberts, 2015 ONCA 450, 65 R.F.L. (7th) 6, at paras. 11-13:

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

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

Financial disclosure is automatic. It should not require court orders – let three - to obtain production.

39At para. 15, referencing r. 1(8) of the Family Law Rules, the court in Roberts said the following:

The power to strike out the pleadings is to be used sparingly and only in exceptional cases. This is such a case. The appellant’s conduct in ignoring court orders and failing to follow the basic principles of family law litigation put him in the exceptional category of cases where the judge’s discretion to strike his pleadings was reasonably exercised.

40The applicant relies on the Court of Appeal decision of Kovachis v. Kovachis, 2013 ONCA 663, 311 O.A.C. 228. In that case, the motions judge ordered that the appellant’s pleadings be struck for failure to comply with previous disclosure orders. The appeal was allowed. At paras. 24, Laskin J.A., speaking for the court, said the following:

The principle governing this appeal is well established. In any case, but particularly in a family law case, a party's pleading should be struck only in exceptional circumstances, where no other remedy would suffice: see, for example, Purcaru v. Purcaru, 2010 ONCA 92, 265 O.A.C. 121, at paras. 47-48. If a party's pleading is struck, that party "is not entitled to participate in the case in any way": see Rule 10(5)(b) of the Family Law Rules.

41The rationale for this principle is obvious. Without one side’s participation in the trial, there is a risk the court will not have either enough information or accurate information to reach a just result. If the judgment provides for continuing obligations that can only be varied on changed circumstances, as many family law judgments do, the injustice may be perpetuated. The clear preference is for both parties to participate such that the adversarial structure of a trial is maintained.

Analysis

42In Norris v. Norris, 2019 ONSC 2795, 27 R.F.L. (8th) 167, at para. 20, the court set out a three-step test governing the exercise of judicial discretion to strike a party's pleadings, as follows:

Is there a triggering event justifying the striking of pleadings?
Is it appropriate to strike the pleadings in the circumstances of the case?
Are there other remedies in lieu of striking pleadings that might suffice?

43I agree with this test and will use it as I embark on my analysis.

1. Is there a triggering event justifying the striking of pleadings?

44The answer is yes.

45This action was commenced by the applicant seeking an equalization of net family property and spousal support from the respondent. The respondent owned a retail furniture store and the applicant worked in that store. The respondent asserts that the applicant stole from her and opened a competing business. The respondent sought full disclosure from the applicant so that a proper equalization analysis and support analysis could be undertaken. Her intention was to retain a forensic accountant to assist in determining the applicant’s net family property. To do so, the respondent needs full disclosure of the applicant’s personal and business finances.

46Hence the motions for disclosure and the resulting orders outlined above.

47The parties in an action such as this must make full disclosure to the other so the trial judge has the information necessary to resolve the financial issues in dispute. A court cannot guess on values to insert into an equalization calculation. In Hao v. Wang, 2015 ONSC 6989, at para. 70, Sutherland J. said the following:

It is trite to say that documentary disclosure is an integral part of family litigation. Without forthright and expedient financial disclosure, family litigation cannot be conducted in a logical, rational manner nor can litigation be settled without comprehensive documentary disclosure. Documentary disclosure which includes financial disclosure is integral and the foundation of family cases for the purpose of either going to trial or settlement. The sooner comprehensive financial disclosure is provided in a logical manner, the sooner litigants in family cases can assess their case and attempt to settle that case.

48In this case, comprehensive disclosure orders were made in September 2016, August 2018 and September 2018. The orders required reciprocal disclosure in many instances. The respondent complied with the orders. She had business valuations completed, likely at considerable expense. She brought motions compelling third-party institutions to produce records necessary to comply with her disclosure obligations, again, at her own expense. She took her obligation to disclose seriously. The applicant did not.

49In May of 2023, I ordered counsel to meet and review the disclosure orders against what had been provided with a view to determining what was missing. They did so on May 26, 2023, and a chart was prepared setting out the applicant’s missing disclosure such that the applicant knew exactly what he needed to obtain. Some additional disclosure was provided to counsel for the respondent after the meeting, but much disclosure remained outstanding, as detailed above.

50The triggering event is the applicant’s failure to comply with the disclosure orders made. In particular:

He did not provide all his bank statements, claiming he provided what he had, but there is no evidence that he attended at banking institutions to obtain statements, and he did not bring any motions for third-party records. In some cases, statements were not provided for the separation date.
The applicant did not provide credit applications. There was no evidence that he contacted credit facilities to obtain the applications, and there were no motions brought for third-party records.
The applicant did not provide all his credit card statements. There was no evidence that he contacted the credit card companies to try to obtain the statements, and no motion for third-party records was brought.
The applicant did not provide personal insurance policies; merchandise purchase invoices; evidence respecting advertisements and signs for his business; documents for leasehold improvements and other documents detailed above.

51I find it particularly troubling that, where the applicant and the parties’ child had a joint account, the applicant told the respondent to get statements from the child, thereby involving the child in the litigation. The obligation to obtain statements was that of the applicant and not the child.

52The failure to comply with the disclosure orders triggers the justification for the motion to strike.

2. Is it appropriate to strike the pleading in the circumstances of this case?

53This litigation has been stagnant for years. It has not moved forward because the respondent has been focused on attempts to obtain disclosure. The respondent has brought motions to force the disclosure; she has had her lawyer prepare a comprehensive chart outlining the deficiencies in disclosure; she paid for her lawyer to meet with the applicant’s lawyer to review the chart so that the applicant would be aware of all the deficiencies in his disclosure. The respondent has tried to do the applicant’s work for him.

54The applicant has complicated his financial information by claiming that his business is owned by his stepdaughter or his brother or his uncle when it is obvious that is not the case. He has been dishonest in the past by keeping cash monies from his trustee in bankruptcy. The respondent asserts that the applicant has chosen what he will produce and held back the rest. That may be the case. At best, the applicant simply has not made the required effort to comply with the orders and make full and complete financial disclosure to the respondent. At worst, he has actively tried to hide his finances by putting businesses into the names of family members.

55The respondent cannot defend herself from the applicant’s claims without the ordered disclosure. It is unfair to expect her to do so.

3. Are there other remedies in lieu of striking the pleadings that might suffice?

56I do not see how any order other than striking the applicant’s pleadings ought to be made. This is a case in which the applicant’s non-disclosure is sufficiently egregious to conclude that he does not intend to help the court come to a just resolution.

57Given the passage of time, the issue in this case boils down to the applicant’s claim for an equalization payment. There are no parenting issues as the parties’ child is now an adult. The child has lived with the respondent since separation, and the respondent indicates she will not pursue child support if the applicant’s claim is dismissed. Accordingly, the involvement of the applicant is not necessary for child related issues.

58In my view, this is a case in which an order striking the applicant’s pleading is entirely appropriate.

Disposition

59The applicant’s claim is struck. The respondent advised that she is prepared to withdraw all of her claims with the exception of costs.

60In the event the parties cannot agree on costs, written submissions no longer than 10 pages along with a costs outline and any relevant offers to settle (both of which are not included in the 10 page limit) may be filed according to the following timeline:

The respondent within 10 days;
The applicant within 10 days thereafter;
The respondent may reply within 5 days thereafter.

XXXXXXXXXXXXXXXXX

Pamela L. Hebner

Justice

Released: April 16, 2025

CITATION: Riley v. Riley, 2025 ONSC 2363

COURT FILE NO.: FS-16-16304

DATE: 20250416

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Winston Riley

Applicant

– and –

Anna Riley

Respondent

ruling on motion

Hebner J.

Released: April 16, 2025