Reay v Robinson, 2021 ABQB 752

Court of Queen’s Bench of Alberta Citation: Reay v Robinson, 2021 ABQB 752 Date: 20210922 Docket: 4801 180941 Registry: Calgary Between: Timothy Wayne Reay Plaintiff (Applicant) - and - Kristina Marie Robinson Defendant (Cross-Applicant) _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice O.P. Malik _______________________________________________________ I. Introduction [ 1 ] In 2019, the parties attended a Judicial Dispute Resolution conducted by a Queen’s Bench Justice (the “JDR Justice”) to deal with a number of family matters.

The JDR did not entirely resolve the matters and the JDR Justice subsequently issued two Court orders that lie at the heart of this dispute. [ 2 ] The first order was granted by the JDR Justice on June 18, 2019 (the “June Order”) and requires that: Para 2 The Plaintiff shall forthwith transfer his interest in [the parties’ matrimonial home] to the Defendant and the Defendant shall have

sole ownership and possession of the Matrimonial Home free from any claim of the Plaintiff. The Defendant shall assume sole responsibility for the mortgage that is registered against the Matrimonial Home.

Para 6 The parties’ camper...shall be listed for sale by the Defendant and any sale proceeds after the deduction of any reasonable costs incurred to sell the camper shall be divided between the parties. [ 3 ] The second order, granted on October 10, 2019 (the “October Order”), stipulates that: Para 1 On or before October 16, 2019, the Plaintiff shall provide the Defendant with a properly completed Form T2220 transferring $78,681.00 to the Defendant, failing which the Plaintiff shall pay costs to the Defendant in the amount of $1,000.00 per day commencing on October 17, 2019, and continuing thereafter until such time as the Form T2220 has been provided to the Defendant.

Para 2 On or before October 24, 2019, the Plaintiff shall: (1) provide the Defendant with a photo copy of the share certificate(

s) of the parties’ shares in Onset, or, if the share certificate(

s) are not in the minute book, a photocopy of the share register; and (ii) transfer one half (1/2) of the total shares in Onset to the Defendant and shall execute and provide the Defendant with transfer reflecting the same. The Plaintiff shall pay costs of $100.00 per day to the Defendant should either (

i) or (ii) above not be completed, commencing October 25, 2019. Para 3 If the Plaintiff complies with both paragraphs 1 and 2 above, the Defendant shall provide legal counsel for the Plaintiff with the Plaintiff’s share of the proceeds from the sale of the Camper on or before October 31, 2019. [ 4 ] Each of the parties is in breach of their respective obligations pursuant to the JDR Justice’s Orders: • The Plaintiff did not provide the Defendant with the completed form T2220 until November 13, 2019, nearly one month after the deadline specified by the JDR Justice in paragraph 1 of the October Order.

Further, it was not until October 29, 2019, four days after the deadline provided for in paragraph 2 of the October Order, that the Defendant received the Plaintiff’s share certificates and security share register. • The Defendant did not fully assume the mortgage to the parties’ matrimonial home until July 27, 2021, more than two years after she was ordered to do so by the JDR Justice pursuant to paragraph 2 of the June Order.

Further, while she sold the parties’ trailer, she did not list it for sale as required by paragraph 6 of the June Order. [ 5 ] The Plaintiff brings an application for a declaration that the Defendant is in contempt of Court by failing to comply with paragraphs 2 and 6 of the June Order.

He seeks damages for the rental costs that he incurred as a result of not qualifying for an additional mortgage and for the loss in sale revenue which he says resulted from the Defendant’s refusal to list the camper for sale. [ 6 ] The Defendant brings a cross-application to enforce the JDR Justice’s costs order arising from the Plaintiff’s late compliance of his obligations pursuant to paragraphs 1 and 2 of the October Order. II.

Summary of Conclusions and Disposition [ 7 ] For the reasons that follow, I conclude and direct as follows:

i) The Plaintiff is not in breach of the October Order. No costs are payable to the Defendant because of his late compliance. ii) One half of the sale proceeds of the parties’ camper, being $12,500.00 is owing to the Plaintiff and shall be paid to him by the Defendant as part of the JDR Justice’s decision regarding the division of matrimonial property by no later than May 1, 2022. iii) The Defendant is in contempt of Court by failing to comply with clause 6 of the June Order. She shall pay to the Clerk of the Court a fine of $350.00 within 14 days from the date of this decision. iv) The Defendant is otherwise not in contempt of Court in respect of the June Order.

v) The Plaintiff’s claim for damages against the Defendant is dismissed. III. The Plaintiff’s Compliance i. Facts a. Paragraph 1 of the October Order [ 8 ] Paragraph 1 of the October Order requires the Plaintiff to provide the Defendant with an executed T2220 form for an RRSP transfer. On October 15 and 21, 2019, he provided the Defendant with various iterations of the form, each of which had errors or was incomplete such that the intended transfer could not occur.

The parties’ counsel exchanged correspondence on November 1 and 8, 2019 regarding the execution of the T2220 form and on November 13, 2019, the Defendant received a properly completed form. The Plaintiff deposes that the late receipt of the form did not prejudice the Defendant as she did not submit the form to the Plaintiff’s RRSP issuer until December 10, 2019. [ 9 ] The Defendant relies on a strict application of the time line for compliance.

She alleges the reason the Plaintiff delayed the proper completion of the T2220 form was “as a means of pressuring me into agreeing to a fictitious sale price related to the camper sale”.

b. Paragraph 2 of the October Order [ 10 ] On October 11, 2019, the Plaintiff notified the Defendant that he was working on obtaining the share certificates for the purpose of completing the share transfer. On October 18, 2019, the Plaintiff was informed that the transfer required corporate Board approval. The Plaintiff received the necessary paperwork to execute the share transfer on October 22, 2019 which he provided to the Defendant later that day. The parties submitted the necessary paperwork required to effect the share transfer on October 24, 2019.

On October 29, 2019, the Plaintiff received the Defendant’s share certificates and a copy of the share register which he provided to the Defendant that same day. ii.

Analysis Paragraphs 1 and 2 of the October Order [ 11 ] I have no evidence before me that would allow me to conclude that the Plaintiff intentionally sought to breach his obligations pursuant to paragraphs 1 or 2 of the October Order, that the Plaintiff was deliberately uncooperative in executing the T2220 form or stalled in properly filling it out, that the delay it took to complete the form and the share transfer documents was motivated to extract any advantage from the Defendant, or that the delay caused the Defendant any loss. [ 12 ] I find that any errors the Plaintiff made in filling out the T2220 form were honest mistakes and that delays naturally arose from counsel’s dealings with each other.

Any delay in executing the share transfer documents was not caused by the Plaintiff but arose because of the time it took to obtain the necessary corporate Board approval and to complete the necessary administrative paperwork.

In my view, these were factors clearly beyond the Plaintiff’s control. [ 13 ] On the whole, I find that the Plaintiff acted in good faith and was duly diligent in taking reasonable steps to meet his deadlines pursuant to paragraphs 1 and 2 of the October Order. [ 14 ] While these deadlines were not strictly met, I find that the Plaintiff’s breaches were of a nominal or de minimis nature and did not result in any prejudice to the Defendant. The purpose for setting deadlines in the October Order was to obtain the Plaintiff’s compliance within a reasonable amount of time.

I find that the Plaintiff substantially complied with his obligations and consequently, I decline to enforce the JDR Justice’s costs orders. [ 15 ] In the result, I do not find that the Defendant may rely on paragraph 3 of the October Order. I understand that on August 28, 2019, the Defendant mailed the Plaintiff a bank draft in the sum of $12,500.00, being half of the camper’s sale proceeds but the cheque was returned because the Plaintiff refused to acknowledge receipt.

The Defendant is not entitled to retain the Plaintiff’s share of the camper’s sale proceeds of $12,500.00 and this sum (if it has not already been received by the Plaintiff), must be paid to him by no later than May 1, 2022. IV. The Defendant’s Compliance i. Facts a. Paragraph 2 of the June Order [ 16 ] I understand that it was just prior to the hearing of this matter before me that the Defendant finally assumed sole responsibility for the mortgage registered against the matrimonial home. In her various Affidavits filed in these proceedings, she explains the reasons for her delay.

She deposes that as a result of having lost her job in August, 2019 and having remained unemployed for some time thereafter, could not qualify for the necessary financing. I understand that it was not until July, 2021 when the Defendant and her current partner jointly qualified for financing that she was able to finally assume the mortgage. [ 17 ] The Defendant’s evidence is that her failure to comply was not intentional and that she would have complied earlier had she been in a financial position to do so.

She argues that the June Order did not specify the deadline for her compliance and that it was the Plaintiff’s obligation, not hers, to return to court to set a deadline if he was prejudiced. She states that despite her unemployment she has kept up with all payments owing on the matrimonial home and that there are no arrears. [ 18 ] The Plaintiff deposes that he was unable to qualify for a mortgage of his own as long as he was also registered on the mortgage of the matrimonial home. He was renting a property from his parents with monthly rent payments of $1,400.00.

He asserts that as a result of not being able to qualify for an additional mortgage, he has suffered damages comprised of the loss of equity he would have built up under a mortgage from July, 2019 onwards in the sum of $15,668.67, and the difference between his monthly rent and what he estimates his monthly mortgage payment would have been of $8,849.36, for damages totalling $24,518.03. The Plaintiff further argues that his employment status changed from employee to contractor which makes it more difficult for him now to qualify for a mortgage.

Finally, the Plaintiff states that the Defendant found employment since losing her job or alternatively, that she was under-employed. [ 19 ] The Defendant denies the Plaintiff has suffered damages.

She claims the Plaintiff would not have qualified for a mortgage on his own in 2019 in any event, that he can enter into a rent-to-own of his parents’ property, that the Plaintiff’s parents could help him qualify for a mortgage, that while living in his parent’s property the Plaintiff received rental income from a renter paying $600.00 per month, and that the Plaintiff’s estimate regarding his damages are speculative. b. Paragraph 6 of the June Order [ 20 ] The Defendant admits that she did not list the parties’ camper for sale as she was ordered to do. However, she says that she

did not act in bad faith because paragraph 6 of the June Order did not specify how the camper was to be sold nor did it stipulate a minimum sale price. She deposes that the camper had sat idle for 2 years. She contacted a reputable RV dealer, GoRV Red Deer (“GoRV”), which drove the RV to its lot in Red Deer. GoRV performed a mechanical inspection and advised the Defendant that the camper required $7,500.00 in repairs.

On July 31, 2019, the Defendant sold the camper to GoRV for $25,000.00 which she believes was the highest price she could get. [ 21 ] The Plaintiff argues that the price for comparable camper makes and models was $40,000.00 and that consequently, the Defendant undersold the camper for $15,000.00 below its realizable value. ii. Analysis a. Paragraph 2 of the June Order [ 22 ] For the following reasons, I decline to find the Defendant in contempt of Court with respect to paragraph 2 of the June Order. [ 23 ] I agree with the Plaintiff that court Orders must be followed.

The purpose of finding contempt of court is to enable “the court to uphold its dignity and process... and to maintain [its] dignity and respect” ( Carey v Laiken , 2015 SCC 17 at para 30 ).

However, the purpose of the contempt power is to achieve compliance with a court order rather than to impose punishment ( Demb v Valhalla Group Ltd , 2017 ABQB 256 at paras 54 , citing Schitthelm v Kelemen , 2013 ABQB 42 at para 59 ). [ 24 ] Great care should be exercised when deciding whether to exercise the contempt power: The contempt power is discretionary and courts have consistently discouraged its routine use to obtain compliance with court orders...If contempt is found too easily, “a court’s outrage might be treated as just so much bluster that might ultimately cheapen the role and authority of the very judicial power it seeks to protect”...

As this Court has affirmed, “contempt of court cannot be reduced to a mere means of enforcing judgments”...Rather, it should be used “cautiously and with great restraint”...It is an enforcement power of last rather than first resort... ( Carey at para 36 ). [emphasis is mine] [ 25 ] This is particularly so in in family law matters where contempt “is to be employed carefully and judiciously” ( BDM v MMM , 2020 ABQB 288 at para 98 ), “to be used sparingly and only as a last resort to address matters that are not trifling” ( BDM at para 73 citing JDG v SLG , 2017 MBCA 117 ). [ 26 ] In my view, the Plaintiff has failed to prove the elements of contempt as set out by the Alberta Court of Appeal in Envacon v 829693 Alberta Ltd. , 2018 ABCA 313 , at paragraph 8 : A finding of civil contempt “requires proof beyond a reasonable doubt of an intentional act or omission that is in fact a breach of a clear order of which the alleged contemnor has notice”: Carey v Laiken ...at para 38...Three elements must be proven (

i) the order must state clearly and unequivocally what should be done (or not done); (ii) the alleged contemnor must have actual notice of the order; and (iii) the alleged contemnor must have intentionally failed to do the act compelled by the order. [ 27 ] Paragraph 2 of the June Order does not set out a date for the Defendant’s compliance. The JDR Justice did not re-visit this issue in the October Order despite setting specific deadlines for the Plaintiff to meet in respect of his obligations.

I can only surmise that the date of the Defendant’s compliance was not in issue before the JDR Justice when he issued the October Order or that the JDR Justice purposefully left the Defendant’s deadline open-ended given her financial circumstances. [ 28 ] To be found in contempt, the person “...must have intentionally done the act that the order prohibits or intentionally failed to do the act that the order compels” ( Carey , at para 35 , cited in Envacon at para 37, 39-41).

The Court may decline to find contempt where the alleged contemnor has exercised due diligence by having acted in good faith in taking reasonable steps to comply with a court order, or has a reasonable excuse for failing to comply with a court order, or where a finding of contempt would otherwise be unjust ( Carey , at para 37 ). [ 29 ] Notwithstanding the lengthy period of time it has taken for the Defendant to finally comply, I find that the Defendant has a defence of due diligence in that she has a reasonable excuse for failing to comply with the June Order.

I accept the Defendant’s assertion that her unemployment made it impossible for her to solely assume the mortgage. Her financial circumstances made it so she could not qualify for financing. The Plaintiff has not satisfied me that the Defendant worked after losing her job or that if she did, that she could have qualified for financing, that she was under-employed, or that she did not promptly take over the mortgage when she and her partner’s financial situation so allowed. I note that the Defendant kept her payments owing on the matrimonial home current.

In light of the caution I must exercise before I declare a party to be in contempt in family proceedings and given that the JDR Justice did not set a deadline for the Defendant’s compliance, I decline to find the Defendant in contempt of Court in respect of paragraph 2 of the June Order. b. Paragraph 6 of the June Order [ 30 ] I find that the Defendant is in contempt as it relates to the sale of the camper. The Order is unequivocal and clearly states that she was to list the camper for sale.

She failed to do so and has not, in my view, provided any reasonable excuse for her failure to do so. [ 31 ] However, I find that the Defendant took reasonable steps in the selling of the camper by cleaning it, having it moved to Red Deer where it was assessed and sold by an experienced RV dealer. I have no reasons to believe that the repairs to the camper were not required or that the camper was undersold given its condition. In the result, I order the Defendant to pay a fine for her contempt of $350.00 to the Clerk of Court within 14 days from the date of this decision.

V. Costs [ 32 ] The parties shall, unless they can agree on costs of this hearing, provide me with submissions not exceeding five pages within 25 days and I request that submissions consider McAllister v Calgary (City) , 2021 ABCA 25 . Heard on August 11, 2021with further written submissions provided on August 30 and September 1, 2021. Dated at the City of Calgary, Alberta on September 22, 2021. O.P. Malik J.C.Q.B.A. Appearances: Stuart Mair of Foster LLP for the Plaintiff, Timothy Reay Cody Stokowski of Soby Boyden Lenz LLP for the Defendant, Kristina Robinson