In last week’s blog, we looked at a case involving a former couple who found themselves before the courts as the mother in the relationship sought to find out how much money the father of their child actually made in an effort to calculate child support obligations. In that blog, we highlighted the importance of providing financial disclosure when going through a separation or divorce. This is particularly true when disclosure is ordered by the courts. In this week’s blog, we look at a decision from the Ontario Superior Court of Justice that highlights the measures courts can take when one party fails to fulfil their disclosure obligations.
Father fails to provide financial disclosure
The parties involved in the matter separated in 2012. By 2013, the mother and father had settled all of their issues with the exception of child support, Section 7 expenses (special expenses for children such as sports and education), and spousal support. The court explained that the reason these issues were left unresolved was that the father had failed to disclose the financial information needed to calculate support. Since 2013, he had been found to be in contempt of court six times for failing to provide disclosure.
In November 2018, following his latest instance of being held in contempt, the court froze the father’s bank account and issued a preservation order concerning a house he owned in his name (the “freezing order”). An uncontested support trial was held after the father failed to respond. He appealed this but was denied. By July 2021, the courts had calculated that the father owed $825,000 to the mother. This amount was made up of support arrears, costs, and expenses. The courts ordered that the money frozen in his accounts could be made available to pay for what he owed.
The father requested an urgent motion regarding this, but his request was denied. The decision stated he did not take any steps to file a motion on a non-urgent basis. The mother filed a motion asking for an indefinite stay of action, arguing that the father was seeking to relitigate matters that had already been resolved.
Determining whether a stay should be granted
The mother’s application for a stay means that she is asking the court to not allow the father to pursue his oppression to the freezing order. She relied on the Courts of Justice Act, which deals with duplicate actions.
The court stated that issuing such a stay is an “exceptional remedy” and would only be used in exceptional circumstances. The Supreme Court of Canada provided guidance on what the requesting party must establish when requesting an indefinite stay. In that decision, the court wrote,
“Issue estoppel is a branch of res judicata (the other branch being cause of action estoppel), which precludes the relitigation of issues previously decided in court in another proceeding. For issue estoppel to be successfully invoked, three preconditions must be met: (1) the issue must be the same as the one decided in the prior decision; (2) the prior judicial decision must have been final; and (3) the parties to both proceedings must be the same, or their privies… .”
The court asked whether the three conditions had been met in this case. In looking at the first factor, the court agreed that the issue the father was pursuing was one that was already litigated, with the father’s appeal being denied. He may not have participated in every step of litigation along the way, but the issues he wanted to address had already been dealt with. Additionally, the father had appealed the freezing order, but his appeal was denied, meaning the second factor was satisfied in that the prior decision was final. Finally, the parties to the potential motion are the same as before.
Father asks the court to allow his motion
The father asked the court to consider allowing its motion based on its discretion, even though the Supreme Court of Canada’s criteria were met. He told the court that allowing the mother’s stay is highly prejudicial to him and that at the same time, his motion does not prejudice the mother. The father relied on a decision in which someone was able to pursue an employment law matter before both the Human Rights Tribunal of Ontario and the courts. Despite the issue being the same before the court and the tribunal, the dual-process was allowed because the remedies coming from each venue could be different. In this case, the remedies would have been the same as what could have or did come out of the prior decisions.
The court did not have much sympathy for the father’s claim that he is being deprived of his right to be heard. In its decision, the court wrote that the father has had “many, many chances” to make submissions as well as to address the sanctions he is subject to. The court noted that the parties have been involved in litigation for close to 10 years and much of the cause around this was the father’s failure to participate in the process.
In light of all this, the court determined the mother had established that this was an exceptional case, and a stay is warranted. This means that the father’s bank accounts will remain frozen and the preservation order for his house will be kept in effect.
Contact Howie Johnson Barristers & Solicitors in Windsor for help in uncovering hidden assets
The experienced family law team at Howie Johnson Barristers & Solicitors has over 25 years of experience helping clients with all matters related to family law, including situations where one party to a relationship has hidden assets or refuses to disclose relevant financial information. If you are concerned about matters related to financial disclosure or the division of assets, please contact us online or by phone at 519-973-1500 to book an initial consultation and see how we can assist you today.