Lester v Martin, 2016 ABQB 446

Court of Queen’s Bench of Alberta Citation: Lester v Martin, 2016 ABQB 446 Date: 20160812 Docket: 1403 01202 Registry: Edmonton Between: Stephanie Nicole Lester Applicant - and - Jonathan Martin Respondent _______________________________________________________ Endorsement of the Honourable Madam Justice J.B. Veit _______________________________________________________ [ 1 ] On July 18, 2016, Ms. Lester, who is self-represented, filed an application to hold Mr. Martin in contempt for having failed to comply with an order of Master Schlosser issued on September 23, 2015 which required Mr.

Martin to provide to the Ms. Lester a Debtor’s Statutory Declaration. On the same date, she filed an affidavit in which she swore that she “cited the defendant in civil contempt / costs of the application”. No other affidavit supported the application. Ms. Lester’s application was scheduled to be heard on August 8, 2016. [ 2 ] At the hearing of her contempt application on August 8, 2016, I told Ms. Lester that I had noted that, in an earlier affidavit sworn on January 18, 2016, Ms.

Lester swore that “she served Jonathan Martin by registered mail on Nov 30th that was returned so I personally went on Jan 2nd & served his mother at his residence”. In the same affidavit, she swore than Mr. Martin had not complied with Master Schlosser’s order. The January 18th affidavit appears to have been sworn in support of Ms. Lester’s January 18th application to hold Mr. Martin in contempt for failure to obey Master Schlosser’s order of September 23, 2015. The January 18 th application resulted in an order dated February 3, 2016 from Hillier J. which adjourned Ms.

Lester’s application to February 24, 2016, peremptory on Mr. Martin, and added that Mr. Martin was to “provide in an affidavit form what your job efforts have been and confirmation of any job and what the terms of employment are and the proposed

schedule of repayment of the judgment previously granted in the amount of

$7,376.38”. [3] I also noted from the file that Ms. Lester had obtained an order from A.C.J. Rooke on February 24, 2016 which held: 1. [Mr. Martin] shall make payments to the Applicant in the amount of $200.00 per month by cheque, commencing May 1, 2016 on theJudgment previously granted in the amount of $7376.38 which paid shall stay other enforcement of the Judgment, absent a further Orderof the Court, or default under clause 2. 2.

In default of the above the entire judgment will come due and enforceable in the full amount including interest pursuant to theJudgment Interest Act from May 1, 2016. [4] That order appears to be in response to Ms. Lester’s January 18th application and Justice Hillier’s order. Her affidavit inrelation to her current application does not discuss the Associate Chief Justice’s order. [5] I attempted to explain to Ms.

Lester – who remains self-represented - that there were problems with her application: - a court will rarely find an individual in contempt unless that individual has been personally served with the application to holdthat person in contempt and there was no evidence before me of service of any kind of Ms. Lester’s current application on Mr. Martin; - because the civil dispute between the parties had been dealt with by A.C.J. Rooke, and an order made, and there was no referencein Ms.

Lester’s affidavit to that proceeding, I required some evidence about the treatment of Master Schlosser’s order at the February 24,2016 hearing. I understood Ms. Lester to say that she had been willing to overlook Mr. Martin’s failure to comply with the Master’sorder, but subsequent events had caused her to decide to attempt to enforce that order. However, her application was an application tohold Mr. Martin in contempt, and there was no reference in A.C.J. Rooke’s order to contempt. If the Associate Chief Justice had dealtwith contempt in February, that issue could not be re-addressed in another court hearing.

Moreover, a possible

interpretation of theAssociate Chief Justice’s decision is that he had concluded that it was no longer necessary to have a statement about Mr. Martin’sfinancial situation and that he had concluded, from the information before him in February 2016, that Mr. Martin could afford to pay$200.00 per month in order to satisfy his debt; - debtor’s prison has been abolished. It is rare, but not impossible, in today’s court system to justify the imprisonment for contemptof a debtor who has not made a money payment. Because Ms.

Lester is self-represented, I will quote a lengthy reminder of the history ofthe use of debtor’s prison as found in Greenberg v Nowak, a recent decision of Perrell J. found at 2016 ONSC 808 (the full text of whichcan be found at 51 In my opinion, the Greenbergs' contempt motion fails all three prongs of the test for contempt, and they have lost sight that thecontempt power is not to be used as an instrument of coercion to secure the payment of debts or to vent their anger at the judgmentdebtor, however justified that anger might be. 52 The administration of justice is long past using imprisonment as a coercive measure to compel debtors to pay their debts.

Thecontempt power found in rule 60.11, upon which the Greenbergs rely explicitly, states that a contempt order is not available to enforcean order requiring a person to pay money. (See Rule 569 of the former Rules of Practice.) The contempt power is used to facilitate thejudgment enforcement process not to return to the days of debtors prisons where persons were imprisoned simply because of an inabilityto pay their debts. 53 The imprisonment of judgment debtors in aid of execution of judgment has a long and fascinating legal history in England andCanada. (See C.R.B.

Dunlop, Creditor-Debtor Law in Canada (2nd ed.)(Toronto: Carswell, 1995); P. Oliver, Terror to Evil-Doers,Prisons and Punishments in Nineteenth-Century Ontario (Toronto: Published for the Osgoode Society for Canadian Legal History byUniversity of Toronto Press, 1998). 54 As explained by Professor Dunlop, by the procedure known as capias ad respondendum, which has roots back to the thirteenthcentury, the sheriff was commanded to take ("capias"); i.e. arrest the debtor, and take him to jail until the case went to judgment and thento keep the debtor there until the debt was paid.

In England there were debtors prisons. In Upper Canada, the debtors were part of thegeneral prison population. In his text, Professor Oliver notes that in 1836, 2,304 inmates, including six women, (48%) of a prisonpopulation of 4,726 inmates, were debtors and not convicts. 55 Over the centuries, the law was reformed in England and Canada and a creditor's rights to imprison a debtor disappeared, and thoserights were replaced by an expansion of the remedies against the property - but not the person - of the judgment debtor.

It was in thiscontext of a law reform movement to replace the imprisonment of debtors with an effective enforcement mechanism that the contemptpower found in rule 60.11 must be understood. Rule 60.11 (1) states: 60.11

(1) A contempt order to enforce an order requiring a person to do

an act, other than the payment of money ... may be obtained onlyon motion to a judge in the proceeding in which the order to be enforced was made. 56 As observed by the Ontario Law Reform Commission in its Report on the Enforcement of Judgment Debts and Related Matters(Part I), supra, at p. 155, it is an essential requirement of an efficient enforcement system that the means and the financial affairs of thedebtor should be fully known. 57 Adopting a recommendation that had been made by the English Payne Committee in its Report of the Committee on theEnforcement of Judgment Debts (February 1969) (Cmnd, 3909), the Ontario Law Reform Commission recommended an elaboratequestionnaire procedure as part of the judgment enforcement procedure. 58 The Commissioners recommended that before a creditor initiates active enforcement measures against a debtor, a procedure beinitiated for the debtor to attend before at an enforcement office to complete a questionnaire.

At pages 156-57 of the report, theCommissioners stated:

We have considered the effectiveness of existing methods of obtaining information concerning a debtor's assets and whether these methods ought to be supplemented by new procedures.

One new method of obtaining pre-enforcement information concerning the debtor's property would be through a judgment debtor questionnaire, where the debtor would be required to reveal his assets in a relatively easy way, on pain of having to attend a more costly and time consuming oral examination. ... 59 The recommendation of the Ontario Law Reform Commission, however, was not adopted by the Ontario Legislature or the Civil Rules Committee, but the idea of a directed disclosure of financial information has very sensibly been institutionalized as a part of family law proceedings for support and the equalization of family property in this province. 60 In its former Rules of Court (Alberta Reg. 309/1968), the Province of Alberta did adopt a judgment debtor procedure under its former Rule 370. 61 I do not know what the impetus was for that Alberta initiative, but the procedure must have been successful, because the province moved Rule 370 from the Rules of Court to become sections 35.09 and 35.10 of the Civil Enforcement Regulation, Alberta Regulation 276/1995 enacted pursuant to Alberta's Civil Enforcement Act, which state: Debtor to provide information 35.09 For the purposes of determining the ability of an enforcement debtor to satisfy the claims of enforcement creditors, an enforcement creditor may require the enforcement debtor to provide information in accordance with this Part.

Financial report of debtor 35.10

(1) An enforcement creditor may, on written notice to an enforcement debtor, require the enforcement debtor to provide to the enforcement creditor a financial report of the enforcement debtor verified by statutory declaration.

(2) Within 15 days from the day on which the enforcement debtor is served with a notice under subsection (1), the enforcement debtor must provide the enforcement debtor's financial report to the enforcement creditor.

(3) Once an enforcement debtor has provided a financial report to an enforcement creditor under subsection (2), no enforcement creditor may, without an order of the Court, require the enforcement debtor to provide another financial report under subsection (1) until one year has expired from the day on which the enforcement debtor provided the previous financial report.

(4) Where an enforcement creditor has been provided with a financial report of an enforcement debtor under subsection (2), the enforcement creditor must, within 15 days of being provided with the financial report, register in the Personal Property Registry a status report for the writ indicating that the enforcement debtor has provided the enforcement creditor with the financial report.

(5) An enforcement creditor who has been provided with a financial report of an enforcement debtor under subsection (2) must, on a written request made by any other enforcement creditor of that enforcement debtor and the tendering of a fee of $25, provide to that other enforcement creditor a copy of that financial report. 62 With the minuscule changes of changing the references from Alberta to Ontario, changing the title, and adding an email reference, Alberta's Form 13 from its Civil Enforcement Regulation is attached as

Schedule "A" to this Decision. 63 It is not for me to decide whether the idea of a judgment debtor questionnaire should be adopted generally, which is a matter for the Legislature or the Civil Rules Committee, but the idea commends itself to me for the immediate case as a means to get the enforcement process initiated by the Greenbergs back on track and focused on its proper purposes, which is to determine whether Mr. Nowack has the financial resources to satisfy his numerous judgment debts in whole or in part. It is not the role of the civil judgment enforcement process to punish Mr.

Nowack for any criminal conduct, which has yet to be proven in criminal court. 64 I, therefore, order Mr. Nowak to complete the form attached as

Schedule "A" within 30 days from the release of these Reasons for Decision. The Greenbergs may serve an appointment for a judgment debtor examination, as they may be advised, but the appointment should be scheduled after 30 days from the release of these Reasons for Decision. [ 6 ] In

summary of that decision, while we do not send debtors to prison for not paying financial obligations, we might impose a contempt sanction, which includes the possibility of imprisonment, on a debtor who fails to provide the required financial report. As part of the contempt hearing, a court will typically explore whether, even without having provided the required financial report, it seems clear that the debtor has no, or limited, means including assets with which to pay a money judgment. I observe now that Justice Hillier's order appears to deal with the possibility that Mr.

Martin does not have funds to pay the judgment. [ 7 ] I mentioned to Ms. Lester that A.C.J. Rooke’s order did not, for example, contain the same warning about contempt as had Master Schlosser’s order. [ 8 ] I suggested to her that she swear an affidavit to deal with the issues that I had outlined and return to court. She returned to court with a filed affidavit of service, dated August 8, swearing that she had, on July 18, 2016 served Mr. Martin with the application in Form 27 which she filed on July 18, 2016.

The affidavit of service does not mention the Lester affidavit of July 18 in support of the application; however, as indicated above, the affidavit merely repeats the essence of the application rather than setting out facts relating to the application. [ 9 ] She did not return with an affidavit dealing with the other issues which I had outlined for her. Instead, Ms. Lester left a note for the court “I filed an affidavit on July 18 th with the application. Sorry I did not want to interrupt.

If you could look over my file and contact me I would really appreciate it.” As indicated above, the July 18, 2016 affidavit from Ms. Lester does not mention any facts at all, and does not deal with the court’s concerns relating to contempt.

[ 10 ] The court does not, of course, have private communications with litigants on contested files. [ 11 ] I deny Ms. Lester’s application for contempt. However, because Ms. Lester is a self-represented litigant and because Mr. Martin has not in any way been prejudiced by this application, I allow Ms. Lester to renew her application for contempt on the understanding that Ms. Lester will address the issues which the court must address on that type of an application, perhaps by filing an affidavit, or perhaps by filing a transcript of the proceedings before A.C.J. Rooke. Heard on the 8 th day of August, 2016.

Dated at the City of Edmonton, Alberta this 12 th day of August, 2016. J.B. Veit J.C.Q.B.A. Appearances: Stephanie Lester, on her own behalf Mr. Martin, did not appear, although served