10.0 Property Issues
 
 

THOMAS G. BASTEDO, Q.C.
AND SUSAN HARRIS, BARRISTER AND SOLICITOR

December 1, 2003

 

 

 
TABLE OF CONTENTS:  
   

 

An injunction is a judicial remedy by which a person is ordered to refrain from doing or ordered to do a particular act or thing.  Originally the jurisdiction to grant relief by way of injunction was only exercisable by the Court of Chancery (in Ontario, the Superior Court) but lower Courts have been empowered by statute to grant injunctive type relief in certain cases.  There are various statutorily defined types of injunctive remedies in the Family Law Act and these remedies will be discussed in these comments. The purpose of applying for injunctive relief is to preserve property pending the happening of another event (e.g., a trial).  The purpose of this paper is to provide a very brief summary of the law of injunctive relief as it relates to family law property  issues.  Topics covered will include: a survey of the types of remedies available, the basis of the authority to bring the relief requested, when to seek each specific form of relief, an outline of the test from the leading cases and some current applications of that test.

 

1.      THE INJUNCTION Top of the Page
1. Is there a serious issue to be tried?
2. Will there be irreparable harm?
3. What is the balance of convenience between the contesting parties?
A.     Serious issue to be tried B.     Irreparable harm

As a function of injunctions, “irreparable” refers not to the quantity of the harm, but rather to the quality.  Examples of irreparable harm include the following:

C.     Balance of convenience

The final arm of the test requires that the judge weigh the pros and cons of granting the injunction in relation to each party.

D.    When is it used?

One instance in which injunctive relief is commonly used in the family law arena is to provide a structure and remedy when there is an application for a stay of one sort or another.  The test is also applied in most motions without notice.

E.     Recent cases

F.      Motions without notice

 

2.         CERTIFICATE OF PENDING LITIGATION Top of the Page

A.     The authority

Section 103 of the CJA combined with Rule 42 of the Rules of Civil Procedure gives the court authority to grant this relief.

Rule 42.01(2) mandates that a party who seeks a certificate under this section include the claim for it in the originating pleadings, together with a description of the land.

Rule 42.01(3) allows that a motion under this rule may be brought without notice.

103(6) The court may make an order discharging a certificate,

                        (a) where the party at whose instance it was issued,

(i) claims a sum of money in place of or as an alternative to the interest in the land claimed,

(ii) does not have a reasonable claim to the interest in the land claimed, or

(iii) does not prosecute the proceeding with reasonable diligence;

(b) where the interests of the party as whose instance it was issued can be adequately protected by another form of security; or

(c) on any other ground that is considered just, and the court may, in making the order, impose such terms as to the giving of security or otherwise as the court considers just.

 

B.        When is it used?

C.         Leading cases

new owner applied to set aside the certificate.  The court held that an interest in land is brought

D.    Recent cases
3.         ORDERS FOR PRESERVATION (S.12) Top of the Page

A.     The authority

Section 12 of the FLA states:

12. Orders for Preservation - In an application under section 7 or 10, if the court considers it necessary for the protection of the other spouse's interests under this Part, the court may make an interim or final order,

(a) restraining the depletion of a spouse's property; and
(b) or the possession, delivering up, safekeeping and preservation of the property.
B.     When is it used? C.     What is the difference between (a) and (b)?

One subsection contemplates “non-depletion” while the other speaks of “preservation”, but is that not just two ways of saying the same thing?  Black’s Law Dictionary defines “depletion” as:

“An emptying, exhausting or wasting of assets…”

and defines “preservation” as:

“the saving of that which already exists, and implies the continuance of what previously existed.”

While the New Oxford Dictionary of English defines depletion as:

“reduce the number or quantity of” and to “diminish in number or quantity”

and defines preservation as:

“to keep safe…maintain in present state” and to “retain (quality or condition)”

A preservation order under s.12(b) can then be interpreted as a mandate that the restrained spouse simply ensure that the overall value of the total property not become less than it is at the making of the order, and the form of the property that makes up that value is immaterial so long as the necessary funds are present to satisfy equalization. In an order mandating non-depletion, however, there is the higher onus to maintain the property in exactly the same quality or kind.

D.    Leading cases

In Bronfman, the court followed the standard injunctive relief set out in RJR MacDonald, when considering an application under s. 12 of the FLA.  However, depending on the facts, the court would place a different amount of emphasis on the third branch of the test, that test being states as:

E.     Recent Cases
4.        RESTRAINING ORDERS (S.40) Top of the Page

A. The authority

Section 40 of the FLA states:

40. Restraining orders – The court may, on application, make an interim or final order restraining the depletion of a spouse’s or same-sex partner’s property that would impair or defeat a claim under this part.

B. When is it used

If the claim is for support when applying for an order restraining the depletion of property, you must bring your application under this section.

C. Leading cases

Section 40 of the FLA is conspicuously under-represented section in the case law.  As such, there is no “leading” authority on its application, beyond the test in RJR MacDonald.  While the issue contemplated by the drafters of the FLA is one that could come up, it has as of yet, been relatively unreported.

D. Recent cases
5.        MAREVA INJUNCTION Top of the Page

A. The authority

Section 101 of the CJA states:

101. (1) In the Superior Court of Justice, an interlocutory injunction or mandatory order may be granted or a receiver or a receiver and manager may be appointed by an interlocutory order, where it appears to a judge of the court to be just or convenient to do so.

And Rule 40.01 of the Rules of Civil Procedure states:

40.01 An interlocutory injunction or mandatory order under section 101 or 102 of the Courts of Justice Act may be obtained on motion to a judge by a party to a pending or intended proceeding.

B. When is it used?

Because of the restrictive nature of a Mareva, the threshold is somewhat higher than that set out in RJR MacDonald.   The Ontario Court of Appeal in Chitel laid out the test for a Mareva injunction as follows:

(1)   the applicant must have a strong prima facie case on the merits;

(2)   there is a real or genuine risk that the defendants’ assets will disappear, or will be removed from Canada, to avoid judgment or frustrate tracing or execution;

6.           ANTON PILLER INJUNCTION Top of the Page

A. The authority

In addition to the authority of s. 101 of the CJA, reference should be made to Rule 32.01 of the Rules of Civil Procedure which states:

32.01(1) The court may make an order for the inspection of real or personal property where it appears to be necessary for the proper determination of an issue in a proceeding.

And one should look at Rule 45 of the Rules of Civil Procedure:

45.01(1) the court may make an interim order for the custody or preservation of any property in question in a proceeding or relevant to an issue in a proceeding, and for the purpose may authorize entry on or into any property in the possession of a party or of a person not a party.

B. When is it used?

An AP order acts like a search warrant, but can be obtained before an action is started to ensure documents are not “lost” prior to proceedings. When drafting pleadings for an AP you must be specific. The court will not allow a party to obtain an AP order to engage in a fishing expedition.

C. Leading cases

The test for whether or not to grant an Anton Pillar injunction stems from the three-pronged test in RJR MacDonald, but, because of the mandatory nature of the order, the first prong of the test is raised from the “triable issue” level to the “strong prima facie case” level.   The applicant on an AP order must establish the following:

(1)   An extremely strong prima facie case;

(2)   Damage, potential or actual, must be very serious for the applicant; and

D. Recent cases

Conclusion

1.      Select your remedy carefully having regard to the objectives of the client.
2.      Make full disclosure, both for and against.
3.      Draft documents succinctly and clearly attaching the ratio of the case to the facts of your case.