Overview
This case addresses the fathers Motion for an Order striking the mother’s Answer on the basis of her being in breach of four (4) Orders (two (2) of which are disclosure orders, the other two (2) being cost orders).
Facts
The mother is a dentist. The father is a trained pharmacist, however, for a period of time during the party’s marriage, he worked with the mother at her dental clinic. He returned to working as a pharmacist post-separation.
The parties were equal shareholders of the mother’s dental clinic. The corporation owned two (2) properties. On the date of separation, the mother also owned an additional rental property and was an equal shareholder with her mother in a second corporation. This second corporation also owned a property.
In early August 2022, the father discovered the mother had listed her rental property for sale. He brought a motion seeking leave to proceed on an urgent basis for an interim order requiring the mother to preserve assets. Leave was granted, however, prior to the motion coming before the court, the mother had taken the property off the market. The motion was then adjourned on consent.
Without further notice to the father, the mother proceeded to sell the rental property as well as the property owned by the second corporation she shared with her mother. Evidence suggested that she likely sold both properties for less than market value.
Prior to this, in October of 2021, there were orders issued requiring both parties to make all reasonable efforts to exchange the necessary disclosure ahead of the next court appearance. When the next court appearance took place, disclosure was still in dispute.
The court then issued a standard financial disclosure order on August 30, 2022. A second disclosure order was made on February 27, 2023, saying that the mother had yet to provide the most basic disclosure in relation to the support and property claims which involved significant business assets and real estate. She was given 30 days to comply and upon failure, she was required to explain in writing why and when she expected to be able to comply. The father was awarded $800.00 in costs.
The mother failed to comply with this order. She did not provide the requested disclosure, nor did she provide an explanation.
Analysis
The court reviewed Rule 1(8) of the Family Law Rules regarding the court’s discretion to make any order it considers necessary to arrive at a just determination in cases where a person fails to obey an Order. This rule outlined possible Orders, amongst which included (a) an order for costs. (b) an order dismissing a claim and (c) an order striking out any answer.
The court then reviewed Rule 1(8.4) which outlines the consequence of striking a party’s pleadings in a case which states that, unless a court orders otherwise:
- The party is not entitled to any further notice of steps in the case;
- The party is not entitled to participate in the case in any way;
- The court may deal with the case in the party’s absence;
- A date may be set for an uncontested trial.
The court did note that striking a party’s pleadings and denying trial participation should be a remedy of last resort.
However, the court then reflected on case law which emphasized that a party’s obligation to provide financial disclosure is the most basic obligation in family law. Failure to provide disclosure 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 as unnecessary judicial time is spent and the final adjudication is stalled. Financial disclosure should not require a court order.
The court then reviewed the framework for to be considered when determining a remedy for allegations of failing to obey a disclosure order, which includes consideration of:
- The relevance of non-disclosure;
- The context and complexity of the issues in dispute;
- The extensiveness of existing disclosure;
- The seriousness of efforts made to disclosure; and
- Any other relevant factors.
The court found that the mother’s failure to comply with the disclosure orders was a wilful decision as the disclosure ordered for production was either readily available to her or should have been. She was also given the opportunity to explain herself and she failed to do this.
Conclusion
The court noted that financial disclosure is a pre-condition to an informed resolution of financial issues in family law matters. As the mother’s failure to provide disclosure as required by the multiple orders, the court determined the mother was completely withdrawn from the process and as such, the court made an Order striking the mother’s Answer and the claims made in it.