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Settlement Conferences in Ontario

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After the parties in a family law dispute bring a motion, they may be able to resolve all of their differences without any further judicial involvement. If issues remain in dispute, a settlement conference is usually held a month after the motion with a case management judge, or by a trial judge when a case management judge is not available.

A settlement conference  must be held in every case where an answer is filed, except for child protection cases. Trial dates are not provided until after the settlement conference is completed, although they can be scheduled prior under judicial discretion.

The goals of a settlement conference are outlined in Rule 17(5) of the Family Law Rules (O. Reg. 114/99):

(a) exploring the chances of settling the case;
(b) settling or narrowing the issues in dispute;
(c) ensuring disclosure of the relevant evidence;
(c.1) settling or narrowing any issues relating to any expert evidence or reports on which the parties intend to rely at trial;
(d) noting admissions that may simplify the case;
(e) if possible, obtaining a view of how the court might decide the case;
(f) considering any other matter that may help in a quick and just conclusion of the case;
(g) if the case is not settled, identifying the witnesses and other evidence to be presented at trial, estimating the time needed for trial and scheduling the case for trial; and
(h) organizing a trial management conference, or holding one if appropriate

The settlement conference judge provides his or her view of how a trial judge might decide the case, and encourages the parties to explore settlement options. Depending on the case, a settlement conference may be combined with a trial management conference.

A judge has a wide range of orders that they can make at a settlement conference including:

  • documentary disclosure
  • questioning
  • filing of summaries of arguments on a motion
  • set time for events
  • use of expert witness evidence at trial
  • service and filing of expert reports
  • affidavit evidence by a witness
  • requiring parties to attend mandatory information programs
  • requiring parties to attend a subsequent case conferences or settlement conferences with a non-judge
  • requiring parties to attend an intake meeting with a court mediation service
  • requiring parties to attend a community service or resource
  • make a final or temporary order, if notice was provided
  • an unopposed order or order on consent
  • referring an issue for alternative dispute resolution, on consent

The applicant or the party requesting the settlement conference must serve their conference brief within seven days, and the other side must serve their brief within four. Attendance must be confirmed two days prior using a Form 14C.

Any brief or statements presented in a settlement conference will not be disclosed to another judge unless there is an agreement or order from the conference.

Bringing a Motion in Ontario

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After a case conference is concluded, a family law litigant may choose to seek an order on motion. A motion can be brought to:

  1. obtain a temporary order
  2. seek direction in the case
  3. obtain a change in a temporary order

There are two documents required to bring a motion:

  1. notice of motion
  2. an affidavit

The notice of motion cannot be served until the case conference is completed, or a case conference is not required, which includes emergencies or special hardship. The affidavit should only contain information that the person signing it knows from first-hand knowledge, or information they received from another identifiable source that the person believes is true. Evidence can also include transcripts from a questioning, or oral evidence if the court allows.

In addition to these two documents, the party bringing the motion may also include evidence in support of the motion. The responding party serves their evidence in response, and the moving party can then serve evidence in reply for any new matters raised in the responding materials. Unless a court indicates otherwise, no other evidence may be used in a motion.

A motion with notice must be filed at least 4 days before the motion date, file the materials at the court at least 2 days before the motion, and file a confirmation (Form 14C) at least 2 days before the motion. The Form 14C will also update the court about the status of the motion.

Motions without Notice

Motions can be filed without notice, as mentioned above, or held before a case conference in emergencies or where it causes special hardship. The moving party is required to provide full and frank disclosure for these motions, even if these facts hurt their case. Courts are usually reluctant to grant these because of the interest in having both parties being able to respond completely, and to promote settlement wherever possible.

The Family Law Rules provide for specific circumstances where a motion can be held without notice:

MOTION WITHOUT NOTICE

(12)  A motion may be made without notice if,

(a) the nature or circumstances of the motion make notice unnecessary or not reasonably possible;

(b) there is an immediate danger of a child’s removal from Ontario, and the delay involved in serving a notice of motion would probably have serious consequences;

(c) there is an immediate danger to the health or safety of a child or of the party making the motion, and the delay involved in serving a notice of motion would probably have serious consequences; or

(d) service of a notice of motion would probably have serious consequences.

Ontario courts are unlikely to grant this urgent relief unless the moving party establishes two things:

  1. the case conference coordinator could not provide an early or urgent case conference
  2. the supposedly critical situation has been attempted to be resolved by the moving party

Justice Wildman of the Ontario Superior Court of Justice highlighted this in Rosen v. Rosen, noting that the exceptions above do apply,

[8]          The availability of case conference dates is important in assessing urgency. Obviously, if a date was not available for several months, a situation that would not otherwise seem urgent might become more critical.

[9]          The next step prior to bringing a motion should be to engage in settlement discussions to try to obtain a resolution of the pressing matters until the case conference date. The focus is on achieving a short-term agreement to get the parties through to the case conference date without a motion, rather than necessarily achieving a final resolution on all issues in the case. While the court will not want to hear about the content of offers that have been exchanged, due to the confidentiality provisions of Rule 18(8) it is important to know whether the parties have made some attempt to negotiate and, if not, why not.

[10]        …In assessing whether this motion is urgent or not, it will make a difference to know whether the other side is completely refusing to pay any funds or is prepared to pay enough money to address immediate needs but not necessarily the amount requested by the moving party.  …It is generally difficult to establish that a motion is urgently needed, absent any attempt to resolve the issues by negotiation prior to bringing the motion.

[11]      …Absent evidence that other alternatives have been considered and are not suitable, it is hard to accept that it is urgent…

[12]      Absent canvassing case conference dates and showing attempts to resolve matters until the available case conference date, it is difficult to understand how urgency can be established.  However, it is possible that the situation could still be so extreme that the court must intervene immediately,

Other Motions without Notice

Another circumstance where a motion may be brought without notice is where it is limited to procedural, uncomplicated or unopposed matters. Examples of these motions include:

If used for situations other than these, the court is likely to adjourn the matter to allow the other party to file material.

Instead of a notice of motion and affidavit, the moving party files a Form 14B motion form. The filing party indicates on the form whether it is on consent or unopposed.

See also the Law Society of Upper Canada’s How to Bring a Family Law Motion for a Temporary Order in the Superior Court of Justice

Orders

There are 3 different types of court orders for family law in Ontario:

  1. temporary order (previously an interim order)
  2. final order (previously a judgment)
  3. contempt order

A temporary order is only effective for a limited period of time, whereas a final order includes a judgment, an order made on a motion that changes a final order, or any order that decides the rights on an issue between the parties or with a non-party.

The types of orders that a judge can make at a case conference or settlement conference include:

  • an order for beneficiaries under a life insurance policy, registered retirement savings plan, trust, pension, annuity or other financial instrument
  • an order to preserve assets
  • an order to prohibit concealment or destruction of documents or property
  • an order for accounting of funds that a party controls
  • an order to preserve health and medical insurance coverage
  • an order to continue payment of periodic amounts in order to preserve an asset or benefit

Contempt orders are issued after a finding of contempt for violating a temporary order or final order.

There are also payment orders in Ontario, which can be either a temporary or a final order, which requires one party to pay money to another.

The effective date of an order is the date it is made, and not the date when it is signed or processed by the court.

If the parties agree to all matters in the order it can save time and money because the parties and their lawyers do not have to come to court. The consent, the agreement between the parties, is sent to the court with the Form 14B, requesting an order that follows the terms of the consent. Some circumstances do not require approval at all.

The terms of an order obtained through a motion is prepared by the successful party within 10 days, otherwise the other party may prepare the draft. The draft must then be served on every party in court or represented for approval of both content and form. An order may be signed by the judge 10 days after the order is served if there is no approval or dispute by any of the parties.

Any disputes over the order must include a draft of proposed changes, and a copy of a Form 25E. Five days after receiving notice of the disputed order, the clerk sets a time and date to hold a teleconference to settle the wording. The disputing party must also indicate the time and date of the settlement teleconference.

 

If the dispute over the order is not resolved by the clerk the dispute is referred to a judge, either by teleconference or through a hearing.

 

Filing an Application in Ontario

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An application is the first step in starting a family law case, and is covered by Rule 8 which states:

FILING AN APPLICATION

8.  (1)  To start a case, a person shall file an application (Form 8, 8A, 8B, 8B.1, 8B.2, 8C, 8D, 8D.1, 34L or 34N).

These applications can include more than one claim against a person, and a claim against more than one persons. The forms for filing an application can be found on the Ontario Court Services website.

Once an application is filed, it must be served on every other party by “special service” according to the criteria described under Rule 6(3). There are 3 options if the respondent(s) cannot be served by special service:

  1. Substituted service under Rule 6(15), requiring detailed information in an affidavit describing the steps taken to attempt special service
  2. An order dispensing of service under Rule 6(16), requiring proof that substitute service would not reasonably be successful
  3. An order validating irregular service under Rule 6(18)

The person starting a case must also file a continuing record with the court, serve it on the other parties, and file an affidavit proving service. The continuing record contains the documents filed in a case and has two volumes:

  1. endorsements
  2. documents 

Templates for the continuing record are available here.

An endorsement volume is not needed in joint applications for divorce, uncontested divorces, change information forms, and consent motions for a final order. An endorsement section is included in the documents volume instead, with a blank sheet where the judge can note the date and disposition.

There are separate continuing records required under Rule 9 for enforcement, child protection, and status review cases. Rules 9(7)-(10) outline the circumstances where a record can be separated. Rule 9(16) states that documents cannot be removed from the record without an order, and parties are jointly responsible for adding to the record under the clerk`s supervision.

Parties are required to maintain the record according to the Formal Requirements of the Continuing Record under the Family Law Rules

When an application is filed in the Superior Court of Justice or Family Court, cases are either designated as standard track or fast track. All applications are fast track unless they include a claim for divorce or property claim. A court date is automatically set for the fast track applications, but for standard track a case conference is booked first.

Parties in Toronto before the Superior Court of Justice must attend a mandatory information program called a Family Information Session (FIS), where a lawyer of family law professional will provide information about the legal process, shares information about mediationidentifies alternatives to litigation, explains the effects of separation and divorce on any children, and points out community resources like My Support Calculator that can help families. Parties cannot take any further step before the courts until they have filed a certificate of attendance at the FIS.

In the Ontario Court of Justice, the first appearance is before a clerk, not a judge, and is called the First Appearance Court (FAC). The clerk helps provides much of the same information as the FIS at the Superior Court of Justice.

Another unique feature of Toronto courts is a Dispute Resolution Officer (DRO) hearing, presided over by a senior lawyer who reviews the materials and offers an opinion on some of the likely outcomes. The purpose of this hearing is to try to promote further settlement.

For more information on the difference between the Superior Court of Justice and the Ontario Court of Justice, see Family Courts in Ontario.

Family Courts in Ontario

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Matrimonial law suits in Ontario are typically dealt with in three courts:

  • Family Court of the Superior Court of Justice, also known as the Superior Court of Justice (Family Court)
  •  Superior Court of Justice
  • Ontario Court of Justice

Every judge of the Superior Court of Justice is also a judge of the Family Court according to s. 21.2(3) of the Courts of Justice Act. Child protection, adoption, divorce and property issues are dealt with by different courts in Ontario.

The Superior Court of Justice (Family Court) is a specialized court focusing on all aspects of family law which can be found throughout Ontario. The Superior Court of Justice is the court of superior jurisdiction in areas where these specialized courts are not found. The following issues are dealt with by these courts:

  • property
  • divorce
  • custody and access
  • child support
  • spousal support

The Ontario Court of Justice deals with these issues:

  • custody
  • access
  • child support
  • spousal support
  • child protection
  • adoption

All of these courts are governed by the Family Law Rules, O. Reg. 114/99, which state,

PRIMARY OBJECTIVE

(2)  The primary objective of these rules is to enable the court to deal with cases justly.

 

Schwartz v. Schwartz, 2012 ONCA 239

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The Ontario Court of Appeal released the decision today in Schwartz v. Schwartz, dealing with the transfer of a matrimonial home where a third-party had issued a writ of seizure and sale for the home.

The couple were married on July 8, 1986, and purchased the matrimonial home in October 1992 in both their names. The title was transferred to the wife on January 31, 2000 as part of an estate rollover from the husband’s father to his two sons. The title was again transferred back to the name of the husband exclusively on March 6, 2006, which the wife claimed was done due to the threat of potential trademark infringement litigation.

Section 14 of Ontario’s Family Law Act states:

Presumptions

14.  The rule of law applying a presumption of a resulting trust shall be applied in questions of the ownership of property between spouses, as if they were not married, except that,

(a) the fact that property is held in the name of spouses as joint tenants is proof, in the absence of evidence to the contrary, that the spouses are intended to own the property as joint tenants…

The wife started her divorce application on May 7, 2009, and claimed an interest in the matrimonial home through a constructive or resulting trust. The wife claimed that the husband was only holding the matrimonial home in trust for her, and she consequently had a beneficial interest in it.

However, prior to the title being transferred back to the husband, he had applied for unsecured credit on behalf of his company and agreed to personally guarantee the indebtedness. He indicated on this application that he was an owner of the house, even though the title was in his wife’s name.

When the loan was defaulted upon, summary judgement was obtained on January 22, 2009 for $500,000, the creditor soon attempted to enforce its writ of seizure and sale against the matrimonial home, which by this time was in the husband’s name. The wife then brought two motions in the divorce proceedings, which included numerous forms of relief including:

  • a declaration of her interest in the matrimonial home through a constructive or resulting trust interest, or an order to have the issue determined at trial
  • an order staying the writ of seizure and sale
  • an order for exclusive possession of the matrimonial home
  • an order setting aside the transfer of the matrimonial home from her to her husband in 2006

Justice H.K. O’Connell of the Ontario Superior Court of Justice presided over the first motion, and noted the lack of independent legal advice and possibility of undue influence:

41     There is nothing before the court to intimate that the lawyer who drew the transfer suggested that any independent legal advice be sought. I find that he was under a duty to refer Mrs. Schwartz for independent legal advice.

42     It is axiomatic, as far as I am concerned, that had he done so, there was a very real possibility if not a certainty, that no transfer would have occurred. As Mr. Greenstein argues, this transfer does not constitute a gift at law. For it to be a true gift one would start with the premise that both party’s eyes were “wide open”. The reality is one party had his eyes fully eyes focused; the other was blinded by the actions of the first. I find further that the use of the word “gift” in the originating affidavit of the applicant is not fatal to the argument. It was not a gift as legally defined. Indeed the applicant pleads that it was a gift but then states that [the husband] holds the property in trust for her. Both cannot ride together.

43     Leaving aside what counsel who drafted the transfer knew, and there is clearly no evidence that he was aware of Mr. Schwartz’s deception on [the creditor] and the [wife], independent legal advice would clearly have fully informed the applicant of the risks involved in the transfer, including the fact that the home could very well be seen as having been gifted away. Independent legal advice was essential here. It was not given nor was Mrs. Schwartz referred for same. That, in and of itself, vitiates the transfer in these circumstances. I would go further and find that the timing of the visit to the lawyer was orchestrated to get Mr. Schwartz what he wanted, and what he needed, namely title — free and clear. It was timing that worked to the manifest prejudice of the applicant.

44     Mr. Zeitz referred the court to two cases in relation to independent legal advice. He asserted that they assist in defeating the argument that independent legal advice was required in these circumstances. The cases are Ascu Community Credit Union Ltd. v. Dunster, (1990), 75 O.R. (2d) 490 (Ont. Ct. Gen. Div. per: Stortini J.) and Marvco Colour Research Ltd. v. Harris, [1982] 2 S.C.R. 774.

45     In Ascu, the court stated that “mere lack of independent legal advice does not invalidate a guaranty in the absence of proof of non est factum, unconscionability, fraud misrepresentation, or undue influence.” In Marvco the court noted that “simple justice demanded that the party able to prevent the loss through the exercise of reasonable care should bear that loss when the only other alternative would be for the innocent appellant to bear it”. As is made clear in Marvco however the circumstances of each case must be looked at.

46     In Bank of Montreal v. Duguid, (2000), 47 O.R. (3d) 737, the Court of Appeal for Ontario stated:

  • As a general proposition, a party may set aside a transaction where that party was induced to enter into the transaction by anther’s undue influence. Thus, where a husband induces his wife to enter into a transaction by means of undue influence, the wife will be entitled to set aside the transaction as against her husband.

47     The court refers to undue influence falling into two categories: actual undue influence and presumed undue influence. I find that either of these categories is applicable. Of course if actual undue influence is shown to exist, there is no need to presume it. Here the relationship between the Schwartz’s was one of Mr. Schwartz being the financial anchor of the household. Coupled with that factor are my findings set out above. Combined with the total absence by the applicant of the deception perpetrated by the [husband] on [the creditor], intertwined with the particular significant absence of any notion of independent legal advice, undue influence is clearly present. [Footnote: In Mantella v. Mantella, [2006] O.J. No. 1337, 2006 CanLII 10526 (Ont. S.C.) Justice Corbett stated: “Further, even if undue influence is a necessary aspect of the test of unconscionability the inequity of the bargain is surely evidence from which a court may infer undue influence.”] The inequity here was manifest. This is precisely why independent legal advice was required.

48     I underline again that both the applicant and respondent attended at the office of the solicitor for the respondent, together, and imparted instructions that lead to the completion of a transfer on the same day. No counsel, much less one who may not be familiar with the intricacies of family law, would have allowed this to happen, nor should it have happened. Counsel who prepared and filed the transfer was Mr. Schwartz’s long time business solicitor. I cannot in any way be satisfied that in the absence of independent legal advice the applicant had the intention to truly gift her interest. Frankly, that would be, as Mr. Greenstein suggested in submissions, “ludicrous.”

 Justice O’Connell set aside the transfer, and did not accept the arguments presented by the wife,

55     There was nothing in it for the wife, save the prospect that somehow her future possible liability for trademark infringement would be defeated with the transfer. This is mere speculation. For a person in the shoes of the wife with few assets, and a significant historical contribution to the mortgage, and the care of the home, to simply gift away her ownership interest in the home, is an untenable theory.

For the sake of thoroughness, Justice O’Connell also addressed the trust issue and found that a trust relationship existed, given that the wife paid directly for the mortgage and maintained the house even after the transfer. He also focused on the representations of the husband to the creditor, and the fact that the wife did not know about the loan.

Although Rules 2.(2),(3) of the Family Law RulesO. Reg. 114/99 provide some procedural flexibility, the lack of undue influence in the wife’s pleadings resulted in procedural unfairness to the creditor, and the Court of Appeal dismissed the Ontario Superior Court of Justice decision setting aside the transfer. The respective interests of the parties would have to be resolved through the trust issue.

The Ontario Court of Appeal found that the presumption of resulting trust under the Act was not rebutted by the transfer of the matrimonial home in 2006, and cited the recent Supreme Court of Canada decision in Kerr v. Baranow,

[15] …While traditional resulting trust principles may well have a role to play in the resolution of property disputes between unmarried domestic partners, the time has come to acknowledge that there is no continuing role for the common intention resulting trust. To explain why, I must first put the question in the context of some basic principles about resulting trusts.

[16]  That task is not as easy as it should be; there is not much one can say about resulting trusts without a well-grounded fear of contradiction.  There is debate about how they should be classified and how they arise, let alone about many of the finer points: see, e.g.,  Rathwell v. Rathwell, 1978 CanLII 3 (SCC), [1978] 2 S.C.R. 436, at pp. 449-50; [Waters’ Law of Trusts in Canada (3rd ed. 2005)], at pp. 19-22; P. H. Pettit, Equity and the Law of Trusts (11th ed. 2009), at p. 67.  However, it is widely accepted that the underlying notion of the resulting trust is that it is imposed “to return property to the person who gave it and is entitled to it beneficially, from someone else who has title to it. Thus, the beneficial interest ‘results’ (jumps back) to the true owner”: [Oosterhoff on Trusts:  Text, Commentary and Materials, 7th ed. by A. H. Oosterhoff et al. Toronto:  Carswell, 2009], at p. 25. There is also widespread agreement that, traditionally,  resulting trusts arose where there had been a gratuitous transfer or where the purposes set out by an express or implied trust failed to exhaust the trust property: Waters’, at p. 21.
[emphasis added]

 Kerr also emphasized the importance of intention at the time of a conveyance where a gratuitous transfer is made. The court held that the motion judge could decide that the wife did not intend to gift her interest in the matrimonial home, and that this conclusion was reasonable based on the available evidence. Although a palpable and overriding error was not made in this regard, the court stated that Justice O’Connell should have proceeded further to establish the extent of the interest the husband held for his wife.

However, given the lack of information before the court on the trust issue, the Court of Appeal remitted the matter back to the Superior Court of Justice, emphasizing the statements in Thibodeau v. Thibodeau and Soulos v. Korkontzilas over equitable remedies when providing  constructive or remedial trust relief, and the need for protecting the interests of creditors.

The Ontario Court of Appeal restrained the creditor from executing the writ of seizure and sale against the matrimonial home until the Superior Court of Justice could determine the extent of the wife’s interest in it.

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