Court File and Parties

Court File No.: FC-24-00000334-0000 (Kingston)

Date: October 16, 2025

Ontario Superior Court of Justice

Between:

V. A. D., Applicant

– and –

C. E. W., Respondent

– and –

C. Corporation, C. T. Corporation and XXXXXXX Ontario Limited, Non-Parties

Counsel

Carolyn Shelley, for the Applicant

Michael Swindley and Mark LaFrance, for the Respondent

Marina Sampson and Hayley Goldfarb, for the Non-Parties

Hearing

Heard: September 18, 2025, at Kingston

Before: Robertson J.

Reasons for Decision

Introduction

[1] This decision follows a long motion heard in person on September 18, 2025.[1]

[2] The Respondent Wife requests an order for detailed financial disclosure from the Applicant Husband and from three non-party, privately held corporations ("the Companies").

[3] The Husband, as owner of shares in those Companies, is responsible to establish the value of his assets and to provide sufficient information when it is called into question.

[4] There is no allegation of wrongdoing on the part of the Companies or their founder, C.D., who is the Husband's father. This motion was presented in a reverent tone towards the senior Mr. D. by all counsel and parties. All evidence details his life as an inspirational story of hard work, ingenuity, perseverance, success and love for his family. It was clear to me that the Companies do not want to be participants in the Husband's divorce proceedings. Layered on top of corporate issues, these people are a family with children. I accept the senior Mr. D.'s evidence that these court proceedings have been difficult on the family. Unravelling the economic aspects of a marriage is hard for extended family, especially when there is a family business.

Legal Authority

[5] I have reviewed all the submissions, evidence and referenced law. I considered issues of relevance, necessity and fairness in reaching my decision. The Family Law Rules promote efficient evidence management. Non-disclosure delays resolution and prolongs stress. I am mindful of the primary objective[2].

[6] I find the Wife has met the test for production of disclosure from a non-party. I have carefully considered the Companies' concerns including commercial sensitivity. I added some provisions to boost the security of the disclosed information. For example, client names may be redacted from documents because they add nothing to the issues for determination by the Court.

[7] Rule 19(11) of the Family Law Rules[3] governs the motion. Family Law Rule 20 oversees other disclosure and questioning including expert opinion evidence. Certain documents must accompany an expert report relied on when forming an opinion. Family Law Rule s 20(24) and (25)[4] govern confidentiality and the use of produced documents. There was no disagreement between the parties about the relevant Rules, the common law duty of confidentiality or the implied undertaking of confidentiality referred to in many cases. No one disputed the obligation to provide timely and comprehensive financial disclosure. It is essential to promote fairness between the parties and to facilitate meaningful settlement discussions. No one raised a concern about the integrity of any of the lawyers. No one raised a concern about a specific expert. The litigants were well represented, filed comprehensive facta and thoroughly reviewed the applicable law.

[8] The Family Law Rules promote evidence management and efficiency. The Court may provide directions where appropriate and order a conference at any step of the case, particularly under Family Law Rule 17. The Husband, as a party, may request a conference or bring a motion if there is a breach of confidentiality. If the Companies, separately from the Husband, form the view that either party is in breach of the required confidential treatment of information, I order that the Companies may request a conference or bring a motion for directions regarding any abuse of information produced under this order. I do not find it necessary to add them as parties to the whole case.

Litigation History

[9] The parties separated over two years ago, August 2023, after a fifteen-year marriage/seventeen-year cohabitation. They have sorted parenting arrangements for their two children.

[10] More than a year ago, September 4, 2024, the Husband started this Court Application. He included a claim to equalize net family property. His Application described him as a shareholder of his family's business, a Group of Companies. He stated: "[T]he business structure is complicated and determination of the value of the Applicant's interest will require determination by a certified business valuator." He has not valued his corporate interests. His two financial statements describe his corporate interests "to be determined."

Respondent Wife's Position on this Motion

[11] The Wife submits the requested disclosure is relevant and necessary to the determination of the Husband's ownership and value in the Companies and to verify his income for support purposes. Her Answer dated October 3, 2024, identified most of the disclosure she seeks today. She plans to obtain an income analysis report to ensure a fair and accurate reflection of money available to calculate support. The documents are not available from another source because the Companies are privately held. She submits it would be unfair to proceed with her case without it. She is frustrated by the lack of disclosure in the two years since separation.

[12] The Husband acknowledges a non-compensatory spousal support obligation and a child support obligation. Compensatory spousal support is disputed. The Wife wants five years of the Companies' income tax returns to determine a pattern whereby other benefits should be added back for the purposes of establishing income for support calculation purposes due to the nature of his employment terms. She submits that personal benefits enjoyed by the Husband such as motor vehicle use, related expenses, promotion, travel, meals, and telephone expenses may not be formally recorded as compensation for tax purposes but might be relevant to determining income for the calculation of support. His company credit card statements, for instance, may provide details. She provided other examples of potential benefits for consideration in determining income. She is not questioning the accounting practices of the Companies.

[13] She objects to signing a non-disclosure agreement ("NDA"), as a condition of partial financial disclosure proposed by the Husband and the Companies. She consents to a Final Order mandating her compliance with subrules 20(24) and (25) of the Family Law Rules concerning confidentiality of documents produced in this litigation as extra assurance for the Companies. She affirms she will not act against her children's potential legacy entitlements, nor her own entitlements by breaching that duty. She has no desire to harm the Companies.

The Companies' Position on this Motion

[14] The Companies agree to produce most of the Wife's disclosure requests until separation if the comprehensive NDA attached to their materials is signed by her, her lawyers, and any third party consultants she retains to help her. The Companies oppose disclosure of post-separation financial statements and tax returns as irrelevant and an overreach into their private business.

[15] The Companies do not require the Applicant Husband, his lawyers or any third party consultants he hires to sign the NDA to obtain and use the disclosure in his personal capacity.

[16] A detailed affidavit filed by the family patriarch sets out the concerns about the disclosure, mostly relating to privacy, competitor advantage or business issues. The Companies point out that the Family Law Rules only govern conduct between parties and not between a party and a non-party like the Companies and the Wife. In other words, her offer of a consent order confirming compliance with the Rules is unsatisfactory to them.

Applicant Husband's Position on this Motion

[17] The Applicant Husband agrees with the position of the Companies. He opposes production of post-separation corporate returns. He will provide most of the financial disclosure to the Wife upon execution of a non-disclosure agreement by her, her counsel, and her experts.

[18] The Husband states he lacks personal authority to release confidential corporate documents without the express consent of the corporations. He states: "I have made all efforts within my power to provide the documentation required to meet my obligations to provide full frank financial disclosure." He admits he did not formally ask for the required authority to obtain or release the documents. I suppose the fact the Companies retained lawyers and argued this motion infers their refusal.

[19] He admits he has not valued his corporate assets. He insists he disclosed his entire income. The Wife has not made any accusation of income suppression. It is unknown if he plans to hire the Companies' national accounting firm to value his shares. He seems aligned with the Companies' interests. Perhaps this is a simple explanation for the different treatment by the Companies of the two parties regarding the use of information, but that is my speculation.

[20] He admits he is an employee of the Companies, a 12.5% minority shareholder and director, but disputes he is the controlling mind of any of the three corporations which are owned and operated by his family. In May 2025, the Husband assumed the temporary role of the Companies' president while his father recovered from a serious health problem. His father explained it was on an interim, internal, and training basis. There was no official or legal change of officers. There was no corresponding financial raise or compensation for the extra duties. Unfortunately, the Husband did not mention this status change to the Wife. She heard it through one of the children. This added upset. Since they were litigating financial disclosure issues regarding his income and employment terms, the Husband probably should have informed the Wife about the promotion, regardless of the static financial compensation.

Discussion

[21] To resolve this case, the parties just need two numbers: the value of the Husband's assets and his income. He filed two financial statements, September 4th, 2024, and September 5th, 2025. In both, he declared his "interest and value to be determined" in the group of family-owned Companies. His efforts to obtain a valuation of his corporate assets are dormant despite his recognition of his duty to do so in the year-old originating Application. He filed a Certificate of Financial Disclosure as mandated under Family Law Rule 13 in late 2024. He made no reference to the Companies under Part C, nothing about date of marriage assets and liabilities and no mention of excluded property. It has not been completed as I review the record.

[22] He did not explain why he had not valued his assets after all this time. No barrier held him back. He gave no indication he would resist any request by the Companies in his personal capacity, for his own counsel or experts to sign a non-disclosure agreement. It really wasn't brought up as an issue. The only issue was whether disclosure would be produced to the Wife on terms.

[23] The Husband's first financial statement underestimated his income. His Application stated annual income earnings of approximately $200,000 from employment and another $50,000 from investments. His financial statement had a different amount. The accompanying paystub listed a bonus of $110,000. He voluntarily makes sizeable payments for the benefit of the family. He does not seem to be evading his responsibility to support his family as he sees it. This could support a view of his income calculation as a mistake and not evidence of income suppression. Disclosure will clear things up.

[24] His recent financial statement notes a $634,843 debt to the Companies since his first financial statement. He shows a monthly repayment but no other details. Again, this might be just another form-filling mistake with an innocent explanation. His Application identified an amicable agreement to purchase the Wife's shares in another jointly owned business without that asset being subject to any further equalization. Repayment of a debt to the Wife's parents plus the buy out between the parties of their jointly owned company might explain this debt. Favourable loan terms do not automatically translate to income. The Wife does not imply any subversive activity. She wants clarification. Disclosure will clear things up.

[25] The Wife's factum includes a review of relevant caselaw surrounding disclosure and corporate control including examples where an opposing party asserted no ownership interest. All counsel noted cases about various corporate duties, exceptions and disclosure examples where other Courts, on other facts, made other decisions. Results are fact driven. I agree that the Wife needs more than suspicion for a non-party disclosure order. There is no evidence this Husband is the majority shareholder which might trigger production of post-separation corporate statements and returns under the Family Law Rules or Federal Child Support Guidelines. On the other hand, the Husband's ongoing assertion that his interest in the Companies is yet to be determined is just dangling. A chart was appended to the Husband's material summarizing corporate structures but due diligence demands a review of documents confirming ownership of shares.

Analysis

[26] The moving party on a non-party disclosure motion must demonstrate that the documents are necessary, relevant to the proceeding and that it would be unfair not to produce them.

[27] The Companies' shareholders are family members. They are bound by a Unanimous Shareholders' Agreement that includes a confidentiality clause, regardless of their familial relationship. The Companies are concerned that financial disclosure without the NDA exposes commercially sensitive and confidential information. For reasons detailed in evidence, this could provide strategic insight to competitors. Understandably, the Companies do not want such documents to be accessed by the public, freely distributed or discussed. Simply stated, as private companies, their commercial and financial information is private. They don't want it shared to the public record or business community. I am mindful of their sensitivity. The Companies expressed concern that their private information will go to a law firm where they have no control as to who may access it. The senior Mr. D.'s affidavit states:

The form of NDA expressly includes Ms. W's lawyers as parties to the NDA because I do not know the other lawyers at their law firm, nor am I familiar with the firm's internal system management or other clients of the firm, and whether confidential information could inadvertently be learned by the lawyer for a competitor, counterparty, supplier or customer, or a prospective competitor, counterparty, supplier or customer. In any event, the intent of the NDA is that any person who receives the documents understands their business sensitivity and the seriousness with which they must be treated.

[28] He is satisfied with the internal systems at his corporate accountants, KPMG and the law firms, Cunningham Swan LLP and McCarthy Tétrault LLP, representing the Husband and the Companies. I find that the Companies' concern about their information being shared with unknown individuals can be managed without requiring an NDA. There is no evidence that the Husband or the Companies made any inquiries to satisfy their concerns. The lawyers for the Husband and the Companies were careful not to raise professional concerns about the Wife's lawyers, Templeman LLP. While collegial and polite, it is important to address the concern head on. The Husband and Companies' lawyers or consultants can explain their systems to the Wife's lawyers. If asked, the Wife's lawyers can confirm if their system matches. If not, they can describe conflict checks or client information safeguards to ensure documents would not be shared with the Companies' competitors for advantage. This is an issue of file management and professional codes of conduct.

[29] Both parties shall advise the Companies, in advance, in writing, the name, credentials and particulars of contact for any experts they consult before sharing any of the confidential documents from the Companies. The Companies can then assess any concerns about the professional governance of the third party consultant. There is no evidence the Wife plans to hire an unqualified expert.

[30] As a further protection, I order that should either party change lawyers or third party consultants, they shall notify the Companies prior to re-sharing confidential Company information. Neither party has disclosed the name of any business valuator or I would have included them by name.

[31] The proposed NDA is an impressive piece of drafting by the Companies' lawyer, Marina Sampson. No need to comment about the rigorous terms. I find the Companies' objections to disclosure can be managed without the Wife, her lawyer and third party consultants signing an NDA.

[32] I find the Wife has met the onus to show that the disclosure is relevant, necessary and should be produced. I find it would be unfair for her to proceed with her case without the requested disclosure.

[33] I find the Final Order mandating compliance with subrules 20(24) and (25) of the Family Law Rules concerning confidentiality of documents produced in this litigation should be mutual, extending to the Husband in his personal capacity to further protect the Companies. Both parties are responsible to cause their third party consultants to protect the Companies' privacy. Both parties must choose their help wisely.

[34] In reaching my decision, I have specifically considered Santilli v. Piselli, 2010 ONSC 2874, at paras. 10 and 12. The test is an objective one – suspicion and conjecture are not sufficient grounds for a production order from a third party:

…[T]he relevance and necessity of the documents sought must be sufficient for the court to find that it would be unfair to the requesting party to go on with the case without the document. Otherwise stated, a party must be able to establish on a balance of probabilities that absent production, she or he cannot conduct their case in a manner that would result in a just determination.

[35] With regard to the post-separation production of corporate statements and tax returns, determining the Husband's proper income for support purposes is a central issue. Once spousal support is determined, it will be subject only to a material change. There is a lot at stake for the children and for both parents as they negotiate their financial future. It is crucial to establish the correct base now. I am satisfied it would be unfair for the Wife to proceed without the disclosure including the recent tax returns and corporate statements.

[36] Since separation, the Husband has provided financial statements with errors. The $634,843 loan he recently obtained from the Companies is not documented in the earlier financial statement. His evidence is a recent promotion to president without additional compensation. It is unknown if the treatment of that loan is a benefit for determining income to calculate support. It is unclear if his share valuations will be underwritten through the Companies, a possible benefit. We don't know because he has not disclosed any steps to obtain valuations. Nothing has prevented him from doing so, despite his acknowledgement of his responsibility from the start. But even if, for example, the Companies fund the valuations, offer favourable loan terms, sort out repayment with him over some timeframe, and as shown, send a nanny with meals to his home, it may not form a pattern of "income" to change the result. It simply may be an upscale version of a dropped off casserole from the grandparents and help from the Bank of Mom and Dad. After all, the Husband has dealt with serious health and other issues. Sorting meal prep for him as alleged when he has the children may just be a kindness. For some, food is love. Even becoming the Companies' president may just be a different way for a son to help an aging parent during a medical crisis. If a tradesperson/child fixes something at the parents' house, it probably isn't income for support purposes. In this family, the trade is complex business management. There is nothing wrong with family backing each other up. It is a consideration of proportionality perhaps commensurate with their station in life. The Wife does not suggest otherwise. It is complicated when the family is also a separate business entity. Disclosure will clear it up.

[37] On the balance of probabilities, I find that absent production, the Wife cannot respond to the case brought against her in a manner that would result in a just determination.

[38] The Companies rely on Jarosz v. Denda, 2024 ONSC 4597, where disclosure was ordered upon signing an NDA. At para. 30:

The deemed undertaking rule (r. 20(24) Family Law Rules) provides litigants with assurances that information will not be used for a purpose other than for the proceeding in which the information and evidence is obtained. However, the deemed undertaking rule is a promise from one party to another. It provides little assurance for third parties, such as an employer or other third party who has contracted with the family litigant, and which contract may include trade secrets, industry specific confidential information, or other commercially sensitive information…

[39] At para. 35:

…If, after signing the NDA and the resulting disclosure, there is no settlement, there is the prospect that confidential information may come up at trial or within filed documents. The result is that third party confidential information may become part of the public record…

[40] Family Court is open to the public. The Husband engaged this privacy/disclosure tension when he initiated an Application in the Court system, intended to facilitate open and transparent proceedings.

[41] One of the provisions of the proposed NDA requires the Wife to consent to a protective or sealing order with respect to the confidential disclosure at her "own cost and expense." No one asked for a sealing order in this motion to minimize the risk of open access to the Court file. Sealing orders have a high legal threshold. That request was refused in Jarosz.

[42] The Family Law Rules and Rule 2.03 of the Rules of Civil Procedure authorize flexibility in the application of court rules where it is necessary, in the interest of justice. This includes the jurisdiction to use initials to protect the identity of parties. This accords with the primary directive. The Wife wants disclosure for proper purposes. She does not want to harm the Companies as a by-product. I find a less invasive Order initializing the names would protect the Companies and satisfy the open court principle.

[43] Kitely J. applied the open court principle, and initialized the court file on her own initiative when she found a suitable alternative to a sealing order in R. (J.) v H. (L.), at para. 29:

The rules provide a less secretive remedy, namely the use of pseudonyms or initials [see Rule 14.08].…It is equally as important that the public have the opportunity to know and understand how these issues are resolved. But it does not mean that the identity of the members of the two families need to be publicized. Without evidence from any of the parties, the balance between those issues is found in the use of pseudonyms. I am prepared to find that these parties would consider it a significant intrusion on their privacy if their identities were made public. Their privacy can be protected while the fundamental value of openness is observed if the participants are identified with initials.

[44] Having reviewed the evidence, I find no public purpose will be served by naming the Companies in this Court proceeding. On the evidence, there is risk of harm if their privacy is breached now, having regard to competition issues in an uncertain economic climate. I find the identification of the parties by initials is necessary and entirely appropriate, given the confidentiality interests detailed in evidence by the Companies. There continues to be a proper record of the proceedings for the purpose of the open court principle. Once the value of the Husband's shares is determined, thus disposing of the risk of public access to private trade matters, the continuation of the use of initials may be reviewed.

[45] While an NDA was ordered in Jarosz, that Respondent had already provided significant financial disclosure and explanations for certain requested disclosure by the time of the motion. In this matter, the Husband has done very little if anything to meet his disclosure obligations. Has he even consulted a certified business valuator?

[46] In Filoso-Baglione v. Lawson, 2024 ONSC 3900, at paras. 44-52, the Court addressed the issue of third-party disclosure, specifically focusing on financial documents held by the Applicant's father, who was not a party to the litigation. The Court ordered the production of certain bank statements from the father's corporation, noting that these documents were relevant to the issues in the case, particularly concerning the Applicant's financial situation and the nature of the financial support provided by her father. Despite the father not being a party to the litigation, the court found bank statements were needed to determine true income and financial means. The information was directly relevant to the Respondent's defense, particularly regarding the claims of financial abuse and the Applicant's entitlement to spousal support. The Court held that without these documents, it would be unfair to require the Respondent to proceed to trial. The information was necessary to properly assess the Applicant's financial circumstances.

[47] Cherkassova v. Cherkassov, 2024 ONSC 6681, recently considered similar issues and reviewed caselaw. The result was an order for an NDA although the facts are different. At para. 44:

In family law, there is a fundamental obligation for parties to provide full and frank financial disclosure. This duty extends to all relevant financial information, including any interest in corporate entities. Failure to disclose such information impedes the court's ability to ensure a fair resolution of financial disputes; Roberts v. Roberts, 2015 ONCA 450, at para. 11.

[48] Further, at paras. 46 and 47:

In Filoso-Baglione v. Lawson, 2024 ONSC 3900, the Court addressed the issue of third-party disclosure, specifically focusing on financial documents held by the Applicant's father, who was not a party to the litigation. The Court ordered the production of certain bank statements from the father's corporation, noting that these documents were relevant to the issues in the case, particularly concerning the Applicant's financial situation and the nature of the financial support provided by her father. Despite the father not being a party to the litigation, the Court found that the bank statements were necessary for determining the Applicant's true income and financial means. The information was directly relevant to the respondent's defense, particularly regarding the claims of financial abuse and the Applicant's entitlement to spousal support. The Court held that without these documents, it would be unfair to require the respondent to proceed to trial, as the information was necessary to properly assess the Applicant's financial circumstances; at paras. 44-52.

As the Supreme Court suggested in Leskun v. Leskun, 2006 SCC 25, [2006] 1 S.C.R. 920 (S.C.C.), at para. 34, nondisclosure is the cancer of family law. This is an apt metaphor. Nondisclosure metastasizes and impacts all participants in the family law process. Lawyers for recipients cannot adequately advise their clients, while lawyers for payors become unwitting participants in a fraud on the court. Judges cannot correctly guide the parties to a fair resolution at family law conferences and cannot make a proper decision at trial. Payees are forced to accept an arbitrary amount of support unilaterally determined by the payor. Children must make do with less. All this to avoid legal obligations, which have been calculated to be a fair quantification of the payor's required financial contribution. In sum, nondisclosure is antithetical to the policy animating the family law regime and to the processes that have been carefully designed to achieve those policy goals.

[49] For clarity, there is no allegation of fraud by the Wife here. The voluntary amount of support paid to her might indeed be correct but she is entitled to make an informed decision for her future and that of her children.

[50] While relevant at this stage, the requested documents may not be relevant by trial. It depends. That can be assessed in the trial management process. If the parties agree on the value of an asset, the documents will not be filed. Both parties acknowledged the need for professional help to conduct valuations in their pleadings. The Wife does not have the luxury of simply reviewing his valuation and guessing if it is accurate. She might agree with his valuation once produced, especially if she is accorded the opportunity to make inquiries of assumptions from his valuator. His failure to provide the value of his business interests without so much as asserting a claim for exclusion or deduction puts her in the position of having to obtain the evidence herself. This increases expense and delay. At this stage, on the record, the only real evidence of the profitability of the Companies is his big bonus. Disclosure will clear things up.

[51] Confidentiality concerns must be balanced with fairness of the litigation process. Disclosure is not publication. The Companies' legitimate interests in safeguarding sensitive business information must be weighed against the necessity for full and transparent disclosure of relevant evidence to permit adjudication, without unnecessarily exposing private information to public scrutiny.

[52] It would be unfair if she were not permitted to examine his case. His experts will have access to corporate records. A credible business valuation proceeds upon review of records and not simply by adopting a version of events told privately by a corporation. A joint valuation may save time and expense but does not seem to be the preferred route for the parties. That would require joint instructions to the expert, with the facts or assumptions upon which the parties would like the expert to rely. Given the cost and delay, this family needs more than just an expert report. They need a reliable one. It will save time and expense if the Wife has a chance for a thorough review of source documents. At the very least, the Wife is entitled to test that valuation by knowing what documents the valuator relied upon and to properly instruct her own expert if she chooses to retain one. This means she needs access to the valuator to understand what assumptions or predictions were made.

[53] Two years post-separation, and one year after he started litigation, his updated financial statement still describes gifts or inheritances from a third person "To Be Determined." He has not detailed why he is unable to determine if he is making a claim for an exclusion or deduction or when he let the Wife know if he is making a claim for a deduction or exclusion?

[54] Most other entries to his updated financial statement are detailed to the penny. Both statements show $0 for business interests at the date of marriage. His affidavit evidence states he is a minority shareholder in the Companies with an interest equivalent to approximately 12.5%. His business interests column on his recent financial statement is generalized: "Interest and value to be determined" as of valuation date. Is that different from 12.5%? There is no time frame for the interest to be particularized or valued. Does he have a valuator in mind? What is the cost?

[55] It is the Husband's delay in detailing his interests, claims or exclusions and his failure to value his assets that necessitates the Wife bringing the matter forward as a non-party motion for disclosure.

[56] Without significant disclosure, the Wife is unfairly prejudiced. How can she respond? The matter is stalled without disclosure.

[57] The Companies object to an order permitting further documents or disclosure upon request. While I agree that the blanket order sought is vague, and should not be granted as presently asked, the Respondent Wife should be permitted to seek clarification as needed. This would be best accomplished by authorizing their experts to communicate. It would save time, costs and avoid delay of further motions. I urge the parties to co-operate. Perhaps they can reach a common ground on valuation principles.

[58] Both parties must advise the Companies in writing who they plan to retain for expert help prior to sharing any of the corporate documents. This will address the Companies' concern that an unknown expert might indeed be in a conflict position, retained to advise competitors.

[59] Both parties' lawyers, certified business valuators and financial advisors will separately be bound by their own professional governing organizations. Should the Companies have concerns of a breach of those duties, by any of those persons, they may bring the matter back to Court.

[60] To further protect disclosure of the Companies' confi