Until that day, the fighting parents who appeared before Mr. Justice Quinn have been barred from court unless they obtain special leave.  Looking at the context, it's hard to argue they did not earn it: 25 court orders from 12 different judges over 7 years, three contempt motions, one suspended sentence, 12 different lawyers, 2000 pages of court filings. 

An apparent lack of respect for the rulings of the Court by both litigants was a factor in this extraordinary Order.   As Mr. Justice Quinn is quoted, "[b]oth sides have shown an inability to abide by court orders such that their access to this court should be restricted by the requirement to obtain leave." 

Mr. Justice Quinn is further quoted as saying "[t]he parties have gorged on court resources as if the legal system were their private banquet table. It must not happen again,".  It is easy to forget that courts are very expensive operations: rent, upkeep and salaries.  An hour before a judge in court is not cheap for society, whether or not the litigants are represented by lawyers.  As a purely editorial comment, it is heartening to see principled recognition of this fact.

The father, perhaps unsurprisingly given the reported facts, is apparently considering an appeal.

Enjoy the weekend,

Chris Graham

This week on Hull on Estates, Sean Graham and Justin deVries talk about court order compliance, contempt and enforcement of court orders in general.

Court Order Compliance - Hull on Estates Podcast #82

Posted on October 23^rd, 2007 by Hull & Hull LLP

Sean Graham:  Hello and welcome to Hull on Estates #82 on Tuesday, October 23^rd, 2007.

Welcome to Hull on Estates, a series of podcasts for the Canadian legal community dealing with issues and insights surrounding estate planning in Canada.   Hosted by the lawyers of Hull & Hull, the podcast will touch on some key considerations when planning estates and Wills.  Now, here are today’s hosts.

Sean Graham:  This is Sean Graham.  I’m here with Justin de Vries. Hi  Justin.

Justin de Vries:  Hi Sean, this is a good opportunity for us.  We’ve never podcast together, so this is our first one.  And today we’re going to take a topic that, I suppose on paper seems a little bit dry, but hopefully we’ll make it more exciting. And it’s really all about enforcing Judgments and Orders.  And because it’s such a large topic, we’re really going to look at the enforcement of or recovery of money Orders.  So that’s what we’re looking at today, money Orders.  There’s other things that you can try to recover or enforce when it comes to a Court Order, but today is money.  And that includes Judgment and Orders. 

Now, in our world, as you said Sean, a lot of things settle.

Sean Graham:  Yeah, and once they settle, often you will head off to Court as a condition of settlement and get Court approval of the settlement and then the question is, do the parties then comply with the terms of the settlement.  And it does seem like a dry topic, compliance with Court Orders, perhaps to lawyers, but for a client who has a Judgment and thinks that that’s the end of the litigation and finds out, uh-oh, there’s other steps we have to enforce, it’s anything but dry to them.

Justin de Vries:  And it is possible in the estate context to issue a Statement of Claim and get default judgment against an estate and then trying to enforce that.  But I think often where I see it is trying to enforce costs Orders that there has been some serious litigation about a preliminary issue.  Ultimately one party is successful and the other party then essentially disappears or is not defending or prosecuting the litigation.  So how do you collect on a cost Order?  And I know, Sean, that you’ve had some experience with contempt Orders.  There’s a couple of options a party has if they want to enforce the payment or recovery of money.  One is a Writ of Seizure and Sale, there’s garnishment, that’s also well known. And you can even appoint a Receiver if need be and that’s more when you’re dealing with a company.  If you’d like to try to enforce an Order for the recovery or possession of land which you can see in a settlement, that’s by a Writ of Possession.  Or an Order for the recovery or possession of personal property other than money, that is enforced by a Writ of Delivery.  So the bottom line is that the Rules, and it’s largely Rule 60, deals with, and when I say Rule, it’s the Rules of Civil Procedure, it largely deals with the recovery of money in our instance and then also the enforcement of Court Orders generally.  And Sean, why don’t you talk a little bit about the contempt proceeding that you can bring.  That’s been blogged on before and we’ve podcast it, but just as a quick thumbnail sketch for the listeners.

Sean Graham:  For sure.  Thanks Justin.  Contempt is basically, I guess all these enforcement Orders are kind of a last resort.  But contempt is certainly that.  Contempt is generally not available if the only Order you’re trying to enforce is the payment of money.  A contempt is generally for an Order requiring a person to do an act or abstain from doing an act which has been mandated by a Court Order.  And the problem with a contempt often, from my point of view, is it’s not the most practical measure because there’s all kinds of relief you can ask for in contempt including jail, but also including fines.  And then the problem you have is if someone’s not complying with an Order to begin with, the question is are they going to comply with the contempt Order?  So often it will wake someone up, and they’ll start to co-operate.  But practically speaking, it’s a tough one.

Justin de Vries:  And in a civil context, Sean, how far is the Court willing to go?  In your experience, have you seen the Court issue a warrant for someone’s arrest ultimately if they ignore a Court Order for the payment of money?  Or is it more likely that they’re going to get a fine?  But what’s your thought on that?

Sean Graham:  I’ve never, having done several of these now, I’ve never once had a judge throw someone in jail.  I’ve heard the judge threaten to do it and then work on the other remedies.  Certainly fines are fairly commonplace and certainly costs Orders.  Not necessarily a fine but a genuine costs Order to genuinely pay the entirety of the costs, I’ve seen that.  But again, throwing someone in jail, aside from stressing the seriousness of a Court Order, doesn’t actually help them comply with the prior Order.  So practically speaking, it can be satisfying to see someone you’re very angry with thrown in jail, but it doesn’t actually, practically speaking, help much.

Justin de Vries:  Right, and what I’ve seen is fines on a per diem or by day basis.  That usually gets people’s attention.  And often you can ask when you’re in front of a judge to enforce an Order of the Court that there be a larger Order that you can seize any assets that they may have in a bank account and if you come, you know, forewarned with some sort of or forearmed with information about what the bank account is, you may get that.  I recently did a Writ of Seizure and Sale in respect of land.  And the one thing that strikes me in that context is that you really have to read the Rules because each regime, be it garnishment, be it the recovery of land, be it the recovery of personal property, or trying to get money, has it’s own way forward.  And our system works very much on notice unfortunately.  So you are giving a debtor notice of what you’re doing and an opportunity really, in a perfect world to pay some people may say, it’s a perfect opportunity to take the money and run.  So you have to be careful but with the sale and seizure of land, for example, you can’t do anything once you get your Writ of Seizure and Sale for land for 4 months.  You just have to sort of sit on it, which seems a bit bizarre.  And then you can only begin to enforce it, as I said, after the 4 months and no sale can take place until 6 months.  So again, the idea is that someone may have an opportunity to satisfy any judgment by selling the land.  Now, I was trying to enforce a costs Order so I was really after money, I just knew that this person had some land that I was trying to get the Sheriff to seize and then sell.  And then even after the 6 months is over, and the sale takes place, the debtor has to have at least 30 days’ notice of the sale.  And one of the things you have to do as well, if there’s a mortgage on the property, you have to write to the mortgagee, in other words, the one with the money, to say listen, I’m about to seize this property or the Sheriff is and so some serious business is going to happen.  So there seems to be a lot of opportunity for the debtor to get away with things but bottom line is there’s a regime that has to be followed in order to do that.  One thing I find, Sean, I don’t know what your experience is, with respect to Rule 60.12, which really allows a Court wide discretion really within the litigation.  If someone is not complying with an Order, not paying costs, for example, and we all know about the concept of coming to Courts with clean hands if you’re asking for relief.  But 60.12 really allows a judge to craft any Order to put the litigation at a standstill, to strike the Claim, strike a defence, make whatever Order is just.  And often that will get the attention of a party.

Sean Graham:  Yeah, honestly I haven’t used 60.12 recently.  The hope is, obviously, that especially in estate litigation where we have our Orders giving directions which really lay out the litigation at the beginning, that hopefully you won’t have to rely on them.  But there certainly, I can think of instances where it…maybe I need to bring it and for sure the broader the Rule it seems to me, at least in estate litigation, the broader the Rule, the more discretion allowed to the judge, the more you can get away from the strict technicalities of the Rule and allow the judge to strike at the practical heart of it.  And I think that that 60.12 seems to me to be a great Rule to do that.

Justin de Vries:  One of the things as well is that, you know, in the estate world, we still occasionally have discoveries.  And if someone is not showing up and you’re getting your Certificate of Non-Attendance, 60.12 is one of those, what I call, basket rules that you should really throw in because it allows you to say to the judge listen, the guy didn’t show up, I want an Order mandating him to show up and just so you know judge, you have not only the ability under a specific rule for that, but you have a larger discretion here that you can do whatever you want.  For example, if he doesn’t show up the second time, the defence is struck or the claim is struck.  Or if it’s an Order for directions, that there’s going to be a hearing as to damages, you know, those kind of options are available.  And just to finish off too I think we should look at the idea of Rule 60.18 which allows a creditor to examine a debtor to really see what their assets are.  And it’s a great way to needle someone because you’re really getting them in to ask about their assets, so you can get at their money, their assets, so that you can use one of the enforcement procedures that we just talked about, to try to get paid.

Sean Graham:  Yeah, and you almost wonder, the threat to use that particular Rule in some cases is probably going to get you there.  They may comply with the Order.  They may not want to tell you the in’s and out’s of their financial dealings.  And that could be actually as frightening as a Court Order or even a contempt motion, in some cases.

Justin de Vries: Yeah, no, it’s a very good point I think.  They may have a lot more money there that they don’t want to have you know anything about.  And there’s going to be a lot of leeway granted to you.  I mean it’s a normal examination in the sense that there can be a refusal, you’d have to go to Court and get the, you know, refusal answered if it’s a genuine question you’re asking.  And of course costs are really going to be, you know, dealt in your favour generally because, you know, you’re really trying to enforce an Order.  And that’s Rule 60.19 which deals with the costs of all this enforcement.

Sean Graham:  And maybe I can ask, Justin, in your experience, and obviously having been through the costs of getting the original Order, the original judgment, whether it’s on a negotiated basis or, you know, all the way through trial, what’s been your experience about the success of getting your costs for not only the proceedings, but the further enforcement steps you’ve had to take?

Justin de Vries:  I think getting costs of the enforcement is not really an issue.  Rule 60.19, I think a judge will want to make sure that the administration of justice is not brought into disrepute by people ignoring Court Orders.  Now they give, as you pointed out in the contempt world, they give people lots of chances.  But eventually the Court’s patience does come to an end, but having an extra chance or a second try doesn’t mean that you don’t get your costs.  I don’t think it allows you obviously to go and visit earlier costs or earlier Orders that you got to try to get your costs.  What it deals with is Rule 60.19 is the current costs incurred.  Then I don’t see any reason why you wouldn’t get those on a substantial indemnity basis, payable forthwith and with interest owing in due course.

Sean Graham:  But again, the substantial indemnity…well not again but…the substantial indemnity may not, for the client themselves, it may not be the full freight and that’s consistently causing concern to my clients anyway.

Justin de Vries:  Yeah, I think what people forget is that it’s substantial indemnity.  It’s not complete indemnity and with any kind of costs award, it’s wide discretion of the Court.  Appeal Courts won’t really interfere in discretion.  It just becomes a dog’s breakfast if they do.  It really renders a judge of first instance without much power if the discretion is taken away.  And clients have to know, I generally say for partial indemnity, I think you’re looking between 30% and 60%.  And I think for substantial indemnity, it can be anywhere from 75% to, you know, in the rare instances, 100%.  But it can be as low as 75% and people have to keep that in mind, that the system is designed so that you really don’t get full recovery.  But I think substantial indemnity when trying to enforce an award of money or to recover money, you’re going to get closer to that 100% than you’re going to get in many other instances because a judge and the Courts will not like to see their Orders ignored.

Sean Graham:  Well, I think that’s hopefully a good primer on these issues.  Thanks so much Justin for speaking to these things. 

Justin de Vries:  Thanks Sean and I’ll look forward to doing our next one together.

This has been Hull on Estates with the lawyers of Hull & Hull.  The podcast you have been listening to has been provided as an information service.  It is a summary of current legal issues in estates and estate planning.  It is not legal advice and you are reminded to always talk with a legal professional regarding your specific circumstances.

To listen to other podcasts, or to leave a question or comment, please visit our website at www.hullandhull.com.

Our theme music is Upper Structure by DJ AKid  and is courtesy of the Podsafe Music Network.

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In Forest, a testator had named his son trustee and sole beneficiary of his estate having no provisions for his common-law wife of 19 years. Despite there being an order specifically prohibiting the dissipation of the estate, the son dissipated a significant amount of the estate assets. The Trial Judge having made a finding of contempt, ordered the son committed to jail for 9 months unless he purged contempt within 28 days by paying the common-law wife. The Court of Appeal noted, following a review of the law, that there are other means by which support orders can be enforced.    

In 2002, the C.A. in Murano v. Murano, [2002] O.J. No. 3632 relied on the reasoning in Forest and held that there was no exception for family law matters. 

In today’s and tomorrow’s blog I will touch upon the case of Dickie v. Dickie, [2007] S.C.J. No. 8, [2006] 78 O.R. (3d)1 (Ont. C.A.), in which the C.A. and Supreme Court of Canada (“S.C.C”) deal with the availability of a contempt motion in respect of the failure of a party to comply with alleged orders requiring the payment of money.

Today’s blog will set out the background to Dickie; tomorrow’s blog will deal with the decisions of the C.A. and the S.C.C.

The case involves a dispute between husband and wife. Before the C.A. was the appeal by the husband from an order finding him in contempt of Court for failing to comply with orders requiring him to secure support obligations by providing an irrevocable letter of credit and to post security for costs. The motion Judge imposed a sentence of 45 days in jail for that contempt, which the husband served immediately. The husband pursued his appeal arguing that the motion’s Judge had no jurisdiction under Rule 60.11 of the Rules of Civil Procedure to make a contempt order because the underlying orders were orders requiring him to make a payment of money.  The wife brought a preliminary motion before the C.A. submitting that the Court should refuse to entertain the appeal because of the husband’s wilful disregard for orders of the Court.

Thanks for reading. Part II tomorrow.

Craig

Read the transcribed version of "Tips for Managing and Controlling Estate Litigation - Conclusion""

During Hull on Estates Podcast #63, Craig Vander Zee and Bianca La Neve discussed various discretionary measures available to a court when making contempt orders.

Rule 60 of the Rules of Civil Procedure was referenced, as well as the decision in Belanger v. McGrade Estate (2003), 65 O.R. (3d) 829 (Ont. S.C.J.).

As I mentioned in yesterday’s blog (November 2, 2006), today’s blog will note several cases wherein contempt motions were brought in respect of passings of accounts.

In Mesesnel (Attorney of) v. Kumer, [2004] O.J.N. 1834 (Ont. S.C.J.), the Court considered a contempt motion arising from allegations that the accounts prepared by a party did not cover the entire accounting period and the accounts prepared were improper.

In this case, prior to the death of Mesesnel, Donald Steward Mills had apparently been a good friend of Mesesnel and also served as Mesesnel’s solicitor and occasional business partner since 1970 and had Power of Attorney over Mesesnel since 1978. An Order was made for the passing of Mills’ accounts. Mills provided some accounting but it was claimed that the accounting was incomplete as it only went back to a certain date (1996) and that it was not submitted in proper court form. The clarity of the Order was a concern. It read:

“4. THIS COURT ORDERS that Donald Stewart Mills provide accounts as required under section 42 of the Act and prepare accounts relating to his management of assets of Mesesnel as required under rule 74, to be provided on or before June 30, 2002 unless otherwise ordered by this court.”

The Court held that it would be foolish for Mills to be ordered to provide the proper passing of all accounts since 1978 simply because of the multiple roles Mills held in Mesesnel’s life. The Court wrote that Mills had “no duty, at law, to account to the Kumers for all the legal work he did for Mesesnel over the years…” and further that Mills did not wilfully or deliberately violate the original Order. Perhaps equally as important, the Court stated that the parties should have not relied on their own interpretation of the Order but sought clarification if they had questions.

In Krause v. Shkopich, [1998] S.J. No. 276 (Sask Q.B.), the Court, in dismissing a motion for a contempt, that claimed a party had not prepared a complete accounting in respect of the administration of trust property found that concerns surrounding the adequacy and completeness of the accounting were better addressed through the more usual course of requiring production and inspection of documents and proceeding to examination for discovery, if necessary.

In Belanger v. McGrade Estate, (2003), 65 O.R. (3d) 829 (Ont. S.C.J.), a sole estate trustee was found in contempt for a repeated failure to pass accounts and to comply with Court Orders. So grave was the non-compliance that the estate trustee was imprisoned. The estate trustee was released from jail, however, when, after hiring new counsel, it was learned that the estate trustee’s original lawyer was the actual cause of the repeated failure to pass accounts (the lawyer had not informed the estate trustee of the multiple Orders requiring the passing of accounts). In removing the contempt Order on the estate trustee, the Court relied on R. 60.11(8) which states, “on a motion, a judge may discharge, set aside, vary or give directions in respect of an order under subrule (5) or (6) and may grant such relief and make such other order as is just.”

In Steingarten v. Steingarten Estate, [1998 Carswell Ont. 5741] (O.C.J.) affirmed (June 22, 1999), Doc. C.A. C30263 (Ont. C.A.), the Court dealt with an application for contempt arising from an Order directing the respondent to provide the accounting required by an earlier Order of the Court. Since the original Order to pass accounts, the matter had been before the Court on a number of occasions. Despite the directions of the Court, the accounts still did not technically comply with the requirements of the initial Order. With the passage of time and the manner of record keeping, the trustee could not provide an appropriate accounting, despite efforts to do so even with the assistance of a chartered accountant.

The court dismissed the application for contempt noting that the matter had “developed into a ‘serious family squabble’ and the interest of justice would not be served by finding the trustee in contempt.” The judge added in his view, contempt had not been established. There was no order as to costs.

When a party defies an Order, an aggressive position by the enforcing party may be the only way to force the other party to comply with the Order. However, as noted in yesterday’s blog, and by certain of the above-noted cases, in deciding whether to bring a contempt motion, counsel should consider where bringing such a motion at a certain time best achieves the desired end.

Have a great day.

Craig.

Part V of the Succession Law Reform Act (“SLRA”) provides the legislative framework for claims by a dependent of an estate. It sets out:

(i) who is a dependent;
(ii) what rights a dependant has in relation to the estate;
(iii) the circumstances the court should consider in determining the amount of support that should be awarded; and
(iv) the kinds of orders the court can make for the satisfaction of a dependent support claim.

Rule 60.11 of the Rules of Civil Procedure explicitly states that a party may pursue a contempt motion in order to pursue those who violate court orders other than for the payment of money.

Some have argued that, even in the face of the language of Rule 60.11, support orders involving the payment of money should be enforceable through a contempt proceeding.

In 2000, in its decision of Forrest v. Lacroix Estate (2000) 187 D.L.R. (4th) 280, (Ont. C.A.) the Court of Appeal set aside a contempt order made as a result of a failure to pay a SLRA dependent support award, affirming that Rule 60.11 does not permit contempt orders for the payment of money.

The Court of Appeal, however, after an extensive canvassing of the law, was unequivocal in finding that Rule 60.11 contempt orders cannot be used to enforce orders for payments of money, including the payment of SLRA dependant support awards or for payments under the Family Law Act.

The Court of Appeal’s decision in Forrest was followed by the Ontario Court of Appeal in its decision in Murano in 2002. In discussing the requirements for contempt motions under the Family Law Rules, the Court of Appeal adopted the decision in Forrest, writing:

“…the effect of rules 60.05 and 60.11(1)…is to remove the court’s inherent jurisdiction to use the contempt power to enforce an order for the payment of money in cases governed by the Rules…It was taken as a given that the plain language of 60.05 and 60.11(1) do not permit contempt proceedings under those rules to enforce orders for the payment of money…I find that the reasoning in Forrest v. Lacroix, is equally applicable to the Family Law Rules.”

While contempt motions may not be used to enforce the payment of SLRA dependent support awards, they may still be appropriate to address the failure of a party to transfer assets (other than the payment of money) as required or the failure to act pursuant to an Order in respect of assets (and/or liabilities) in proceedings involving the SLRA.

Have a great day, Craig.