In a recent decision following one of a series of emergency support motions related to child and spousal support, Justice Pazaratz expressed frustration with the approach that an on and off couple had taken to the outstanding issues between them, stating:

Endless motions for temporary orders with no apparent interest in proceeding to trial – this emerging trend is protracting litigation, driving up costs, frustrating litigants, and needlessly placing judges in the untenable position of having to decide complex issues based on inadequate information. 

What Happened?

The parties are the parents of two children (aged 10 and 8). They were married in 2006, and separated for the first time in 2010. Following this initial separation, they obtained a court endorsement in Milton severing their divorce application from related relief issues. This endorsement was never turned into a formal court order as the parties reconciled a short time later, and seemed to forget about their court action.

The parties separated again in June 2016, and the husband filed a new application in Hamilton seeking a resolution to the same issues that had first arisen in 2010. Both parties aggressively pursued parenting issues through a series of motions, including a long motion by the mother for comprehensive relief related mainly to spousal and child support.

At the start of the hearing of the long motion, Justice Pazaratz encouraged the parties to take some time and try to settle some outstanding non-contentious issues, which they were successfully able to do. However, Justice Pazaratz quickly took issue with what transpired thereafter, namely, the parties’ approach to the outstanding claims for spousal and child support.

Delayed Action

Justice Pazaratz noted that even though there had been a series of motions commenced “since literally the day after separation in June 2016”, the mother had not made a formal motion for temporary spousal or child support until April 2017.

Prior to this formal motion, at a Settlement Conference which had taken place in February 2017, the parties essentially chose to put their case “on hold” and were told to arrange a further Trial Management Conference when they were ready, and if such a Conference was necessary. Justice Pazaratz noted that, since then, the parties had done nothing to advance their case to trial, but that, with the filing of the mother’s long motion, had “suddenly asked the court to address complex support issues in which credibility, factual determinations, and the legal effect of the 2010 Milton order were hotly contested”.

At the motion hearing, the father’s lawyer asked that no order on support issues should be made, and requested such issues to be adjourned to be dealt with at another Settlement Conference. The mother’s lawyer objected to any adjournment on the basis that there had already been one Settlement Conference, and because the father should not be permitted to “stall” the outstanding support issues any longer since he hadn’t paid any support since the 2016 separation date.

“This is not how court cases are supposed to proceed”

In response to the parties’ respective requests, Justice Pazaratz noted:

There is no legitimate reason why the parties should present all of these complex issues to the court by way of such voluminous, conflicting and incomplete affidavit materials at such a late stage in this action.

He further noted that:

  • Each party complained about inadequate and/or late disclosure by the other party, but neither took sufficient steps to either produce or compel disclosure in a timely way;
  • There are factual disputes which could have been tested by Questioning at trial, but the parties chose not to take such a basic and obvious step;
  • On the morning of the motion hearing, and just before entering the courtroom, the mother’s lawyer revealed to the father’s lawyer, for the first time, that the mother had just started a new job.  Her financial situation would now be completely different but her lawyer provided no disclosure as to what her new income was.

Justice Pazaratz additionally noted, that “this is not how court cases are supposed to proceed”. If the parties had raised their support claims following their separation, both the disclosure and other factual determinations could have been addressed a long time ago. Similarly, had the parties not adjourned their matter in February they would likely have had a trial date within weeks of that Settlement Conference, which would also have given them a chance to thoroughly address all outstanding issues.

Justice Pazaratz further stated that:

Motions for temporary relief are often an unavoidable but notoriously imperfect method to address urgent issues, where parties haven’t had enough time to fully prepare their case, and/or where the court system doesn’t have enough resources to give litigants an early trial.  Proceeding by way of motion shortly after separation is understandable. 

But if parties elect to take a lackadaisical approach; if they do nothing to advance their case for months and months; and if they adjourn their case to the timelines thereby forfeiting opportunities for timely resolution – then at a certain point they may lose the right to expect judges to wrestle with inadequate affidavit materials on busy motions lists.

Don’t wait almost a year and then suddenly call it an emergency [emphasis added].

The Decision on the Motion

Justice Pazaratz recognized that he was not able to fully determine the outstanding factual and legal issues, but, had to create a “temporary regime based upon imperfect evidence” because no spousal or child support had been paid for more than a year in a situation where there was clearly a need for those payments, and an ability to make them.

The judge ultimately made a temporary order with respect to spousal and child support, with the final decision on both to made by a judge at trial. He also ordered the parties to immediately contact a trial coordinator and schedule an additional day of proceedings.

If you are considering separation, or have already begun the process, contact the knowledgeable and experienced family law team at Jason Howie. We can proactively advise you on critical issues such as child support, spousal support, and related matters. Call us at 519-973-1500 or contact us online. We serve clients in Windsor, Essex County and throughout the region.

In one of his excellently written decisions, Justice Pazaratz addressed the consequences of a failure to accurately disclose assets when entering into a marriage contract.

The History of the Former Spouses

The former spouses were married for approximately ten years prior to separating. They have two children: an 11-year old daughter, and a 7-year old son.

Following their separation, they continued to live together in the matrimonial home and shared temporary joint custody of the two children. The matrimonial home is located on a  151-acre property. There is another home on that property where the husband’s mother resides.

The Marriage Contract

The largest issue between the former spouses was property division. Two months before they married, the parties had signed a marriage contract that solely addressed property (mostly the 151-acre piece of land owned by the husband).

After the separation, the wife sought to have the marriage contract set aside, arguing, among other things, that there had been inadequate disclosure and misapprehension of facts.

The husband sought to have the contract upheld, seeking to have the equalization obligation significantly limited.

Two Pieces of Property

What neither party realized was that rather than being one large property, the 150-acre property was actually two separate pieces of property, both owned by the husband.  This fact did not arise until the final day of a fairly lengthy trial.

All along, the parties had understood that there were two homes, with two municipal addresses. One of the homes was on a larger parcel of land, separated from the smaller parcel by what had repeatedly been described as a “hydro right of way”. However, at every stage of the proceedings, the land had been described as a single property by both the parties and the various lawyers who had dealt with the property over the years. One of the lawyers had even described the property as “non-severable.”

This was accepted as common knowledge for the duration of the trial, until a real estate appraiser, who was the very last witness, testified. The appraiser had prepared two appraisals to ascertain the value of the 151-acres:

  • One for a 126-acre parcel of farmland where the mother-in-law was living; and
  • Another for a 25-acre parcel of farmland where the former spouses had resided, and continued to live post-separation.

Justice Pazaratz asked the appraiser why he had prepared two appraisals. The appraiser answered “because they are two separate properties”. This was the first time either party, their lawyers, or the judge had heard of this. Nine witnesses had already testified, none of which had identified the property as anything other than one piece of land.

The appraiser clarified that after he was retained to appraise what had been described to him as one 150-acre piece of land, he realized that the property was actually two separate parcels divided by a hydro corridor. The hydro corridor was not a right of way (as originally noted), but a separate strip of land that was actually owned by the hydro company, therefore separating the land into two independent parcels that happened to be owned by the same person (i.e.- the husband). The appraiser noted that the pieces of land were as separate and “independently marketable” as though they had been two different houses in two different cities.

It turns out that the appraiser had actually brought this to the attention of the husband’s trial lawyer (different from the lawyer who had helped the husband with the marriage agreement), long before the trial even began. Unfortunately, not only did the trial lawyer fail to pass this information on to the wife’s trial lawyer, but throughout the trial, he knowingly advanced the proposition that the property at issue was a single, non-severable piece of land.

While the husband’s trial lawyer argued that the property issue was “at most” a “miscommunication” and that nothing turned on whether the husband had owned one property or two, Justice Pazaratz noted that this was actually central to the interpretation of the marriage contract. In 1996 when that contract was signed, the parties believed that there was a single 151-acre parcel of land owned by the husband.

Marriage Contract Interpretation

The wife’s application to set aside the marriage contract relied on s. 56(4) of the Family Law Act, which gives the court the power to set aside either part of, or the entirety of, a marriage contract in specific circumstances:

56(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.

Justice Pazaratz noted the critical importance of the disclosure requirements in family law. Indeed, the case law is clear: proper disclosure requires both parties to disclose the value of their assets. Spouses have a positive duty to make complete, fair, and frank disclosure of all financial circumstances before entering into a contract.

Justice Pazaratz identified two fundamental questions that had to be asked in this case:

  • Was the disclosure provided in 1996 (before the marriage contract was signed) accurate and complete?
  • If there was non-disclosure, to what extent would the undisclosed information have been material to the negotiation of the marriage contract and the final agreement?

Justice Pazaratz noted:

There can be little doubt the [husband’s] disclosure in 1996 was neither accurate nor complete.  Some of this may have been through inadvertence.  As it turns out, neither the [husband] nor his [original] lawyer…knew the [husband] owned two severable properties rather than a single parcel of 151 acres.

But the majority of the inaccurate disclosure set out in the marriage contract…must be attributed to either advertence from the [husband’s] perspective, or a woeful lack of precision on the part of [his original lawyer].

The husband’s trial lawyer argued that even if the husband’s disclosure had been inaccurate, the wife had “every opportunity to protect herself” because she had obtained independent legal advice.

On this note, Justice Pazaratz stated that:

…I agree that on the face of it, this should provide an extra layer of assurance, particularly since the Family Law Act does not actually require independent legal advice as a pre-requisite to a domestic contract.  But the quality of a lawyer’s advice is based upon the quality of the information the lawyer is given.   If both the [husband] and [his original lawyer] unwittingly gave [the wife’s lawyers] inaccurate information, a fundamental issue arises as to the extent to which (a) her lawyers were able to give proper advice, and (b) the [wife] was in a position to make a truly informed decision. 

Justice Pazaratz went on to say:

The problem, of course, lies in [the husband’s trial lawyer’s] self-serving assumption that even if the [wife] had known the true facts – individually and/or cumulatively – she still would have signed exactly the same contract.  It is obviously difficult to speculate about what people likely would or wouldn’t have done if they’d known the true facts.  But it is reasonable to presume that the magnitude of the misrepresentation bears at least some relationship to its materiality.  You cannot really give up rights unless you know what you are giving up. And you can only know what you are giving up if the other side makes full, complete, and accurate financial disclosure.

Justice Pazaratz ultimately concluded that the marriage contract had failed to meet the disclosure requirements under the Family Law Act. This non-disclosure was “material to the property determinations which were the one and only purpose of the marriage contract”. Overall, the inaccuracies in the contract were so serious that they completely undermined the factual basis for the agreement.

Justice Pazaratz stated:

It would be manifestly unfair to allow a party seeking to uphold a contract to suppress potentially damaging information, and then gain an advantage from that distortion of the evidence.

The Finding

Justice Pazaratz agreed with the wife’s position that the marriage contract should be set aside due to material misrepresentation. At the time that the contract was drafted and signed, the wife and her lawyer had been misled into believing there was only one property.

Ultimately, Justice Pazaratz ruled that the wife was permitted to proceed with her equalization claim.

This decision was appealed, and later reversed by the Court of Appeal, which we will address in next week’s blog.

In the meantime, if you have questions about complex property division, call us at 519-973-1500 or contact us online. Many of our clients are referred to us by former and current clients, as well as by lawyers, accountants, and other professionals.

In his standard blunt fashion, Justice Pazaratz recently pointed out the shortcomings of the Canadian justice system when it comes to family law disputes involving parents who live in separate provinces.

The Justice made a ruling about a motion that a father had previously brought in Nova Scotia to amend the terms of his child support obligations, a motion which had subsequently come before Justice Pazaratz for confirmation in Ontario. Justice Pazaratz ultimately rejected the Nova Scotia judge’s order, noting that:

There’s an old saying: “Two Heads Are Better Than One”. But not when it comes to trial judges [Justice Pazaratz].

The Facts

The parties were married in August 1979 in Hamilton, Ontario and separated in February 1985. They had two sons, born June 1980 and February 1982. An order granted in March 1985 gave the mother custody of the sons, with the father to pay $600 monthly, per child, with an additional $1400 annually, per child, for tuition.

The father eventually moved to Nova Scotia where, in 1989, he filed a motion to change the custody and support order. The court in that province granted several of the requested changes, including reducing the amount the father was to pay in monthly support and annual tuition during any time that he was unemployed, but increasing the amount during any time he was employed. For any month in which the father wished to pay the lesser amount, he had to submit proof of unemployment. Arrears were fixed at just over $11,000.

In 2013, the father filed for another variation which requested that the child support arrears be fixed at the previous amount based on the fact that both children had ceased to be a “child of the marriage” when they had turned 19 (in 1999 and 2001, respectively). The court granted the variation, relieving the father of almost $125,000 in arrears that had accumulated.

The Nova Scotia order fixing the arrears was only provisional in nature, and had to be brought to an Ontario court for confirmation, rejection, or variation by an Ontario judge. Justice Pazaratz was that Ontario judge.

Interjurisdictional Divorce and Family Disputes

Justice Pazaratz acknowledged the challenges with interjurisdictional disputes in family law, stating:

The Applicant lives in Nova Scotia, so he told his side of the story to a judge in that province. The Respondent lives in Ontario, so now she’s told me her side of the story here in Hamilton. Two judges.  Each hearing different parts of the case.  On different dates, many months apart.  Having to make decisions on the same case. It may sound good on paper. It may even seem like the only practical way to deal with motions to change support, where parties live in different parts of the country and neither can afford to travel. But except in the simplest of cases, it creates an almost impossible task for judges who are: a.   Accustomed to hearing both sides of the story at the same time.  b.  Unaccustomed to wading into the realm of advocacy, by leading or cross-examining the evidence.

The father’s motion sought to change a support order that was made under the Divorce Act. Sections 18 and 19 of that Act permits a bifurcated process in which former spouses that reside in different provinces can file applications for variation of existing orders within the province in which they live. The court in the other relevant province must then confirm, reject, or vary that order.

This two-step process is “intended to relieve the unfairness to a spouse of being deprived of access to a variation because the other spouse is residing in another province”.  However, as noted by Justice Pazaratz, neither of the courts in question hear from both parties at the same time, and:

the court hearing from one party may not know whether there might be evidence contradicting that party’s position. And with no one present to formally cross-examine or challenge evidence at either hearing, the respective judges involved in the process are each placed in the difficult and conflicted position of not only weighing the evidence but also eliciting and testing it.

Attempts to overcome these challenges have been used, such as the use of teleconferences to discuss and clarify additional evidence,  but Justice Pazaratz noted the potential problems with this approach as well, stating that “where significant factual and credibility determinations need to be made, the limitations of the separate-judge/separate-hearing process cannot be overcome by last minute phone calls giving the Applicant an opportunity to shore up his or her case.”

Justice Pazaratz further noted that, despite creating this two-step process, the Act does not provide any guidance on how the court that is supposed to review the first court’s order should reconcile the evidence from two separate hearings.

This two-step process makes credibility determinations difficult, especially since the second judge only has the benefit of potentially interacting with one of the two parties (both parties are not required to be present).  To additionally complicate matters, the second judge has the option of referring the matter back to the first judge to obtain more evidence, which can result in delay and additional impediments.

The Decision

Justice Pazaratz accepted the mother’ evidence that the moratorium on the collection of child support arrears past 1989 had no factual or legal basis. He noted that the Nova Scotia court had not had the advantage of hearing the mother’s evidence, which he had found thorough and credible. He felt that is was unnecessary and inappropriate to refer the matter back to Nova Scotia for further information from the father that would “otherwise shore up his very unconvincing case.”

Justice Pazaratz stated that the bifurcated system had already worked to the father’s advantage, allowing him to ignore his support obligations “for most of the children’s lives”.

He concluded by stating:

The order of [the Nova Scotia judge] dated May 28, 2014 is confirmed only to the extent that the [father’s] obligation to pay child support pursuant to the order of March 23, 1989 terminates in relation to both children effective April 1, 1999.  Prior to that date, for any period that the [father] did not provide proof of unemployment, his support payments shall be in the sum of $700.00 per month. 

The moratorium was lifted, and the arrears were enforceable, with no reduction of arrears prior to April 1999 and no restrictions on enforcement.

Read our other blogs about Justice Pazaratz’s infinitely quotable decisions:

If you have questions about separation, divorce, or any other family law issue, please contact Windsor family lawyer Jason P. Howie, online or at 519-973-1500.

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