Granofsky v Lambersky 2019 ONSC 3251: Absent a Contempt Finding, Does the Court have Jurisdiction to Impose a Financial Penalty for a Party’s Failure to Meet Disclosure Obligations?
The Applicant in this case was seeking an order imposing a monetary penalty in such amount as the court deems just for the Respondent’s failure to adhere to a court order for disclosure. The court was tasked with determining whether it has jurisdiction to make such an order.
This proceeding commenced in January 2015. Since then, the Applicant has encountered consistent and significant difficulties in obtaining financial disclosure from the Respondent. The judge accepted the Applicant’s evidence that the Respondent had failed to meet his disclosure obligations and thus breached multiple orders in the process. Most, if not all, of the above disclosure obligations had been outstanding at the time of this motion for approximately four years, and form part of several court orders including Justice Moore’s consent order.
The court is now tasked with assessing the appropriate penalty that will both compensate the Applicant for her troubles and discourage the Respondent from continuing his behaviors by providing adequate disclosure.
This analysis begins with the friendly reminder that the most basic obligation in family law is the duty to disclose financial information. Case law tells us that a failure to abide by this fundamental, immediate and ongoing obligation “impedes the progress of the action, causes delay and generally acts to the disadvantage of the opposite party. It also impacts on 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 alone three, to obtain production.”
This principle was established in Roberts v Roberts  O.J. 3236 ONCA 450. The comments highlight the seriousness of the Respondent’s failure to adhere to his court ordered disclosure. An individual’s unilateral decision to not abide by the law could have a largely negative impact on the administration of justice.
It is for these reasons that the Judge noted that the court has jurisdiction to monitor and police its own case management process. The Respondent was hopeful for a strict interpretation of Rule 1(8) of the Family Law Riles, which permits the Court to make “any order that it considers necessary for a just determination of the matter.” The list of options available to the Court under Rule 1(8) is not exhaustive in nature, but inclusive. A just determination of any family law proceeding is rooted in the protection of the administration of justice as a whole, and when a party chooses to consistently disobey a court order, the administration of justice itself is called into question.
The judge remarked that the Respondent was hoping for a strict interpretation of the rules while simultaneously failing to adhere to others. This hypocrisy did not shed a favorable light on the Respondent. The Judge noted that “where a party commits an ongoing abuse of a central facet of the Family Law Rules, a resulting fine or monetary payment does not punish that party as an affront to the Court. Rather, the Court is enforcing its own process by ordering a stake in or cost of the proceeding due to that party’s own conduct.”
It was clear in this case that money was a largely motivating factor for the Respondent because the Judge stated that potential incarceration following a finding of contempt may not necessarily result in compliance with disclosure obligations and would typically not contribute much if anything to the advancement or resolution of support or equalization issues.
The jurisdictional question was answered by the Judge, who stated that “the Court has jurisdiction under the Family Law Rules to order a fine or monetary payment as part of its role to control and enforce its own process. Such a remedy places a price on non-compliance with court orders and discloses obligations commensurate with that process. While a remedy of a fine or monetary payment should be reserved to exceptional and/or egregious circumstances, the Respondent has been given opportunity after opportunity to comply with his duty to disclose financial information and documentation and I find the case before me to be a fitting example for such an order.”
The Judge found the Applicant’s request for an order compelling the Respondent to comply with his outstanding obligations by a specified date, failing which he should pay the Applicant a penalty of $500.00 per day for each day of non-compliance, to be reasonable. Ultimately, the Judge ordered the Respondent to comply with his outstanding obligations by no later than June 30, 2019, and failure to comply with any of his stated obligations, he shall pay a monetary penalty of $500.00 per day for each day of non-compliance to the Applicant.
As a result of this outcome, there are currently competing authorities at the Superior Court of Justice level in Ontario for this issue. It will be interesting to see how future Justices exercise their discretion on these matters.
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