Lymer v Jonsson, 2023 ABQB 565

Court of King’s Bench of Alberta Citation: Lymer v Jonsson, 2023 ABQB 565 Date: October 11, 2023 Docket: BE03 446521 Registry: Edmonton Between: Neil Alan Lymer Applicant - and - Diane Jonsson, Georgina Porozni, Natalie Minckler, Keith Porozni, Colleen Porozni, Michael Wygera, Willis Porozni, 1146601 Alberta Ltd., 1419253 Alberta Ltd. and 782409 Alberta Ltd. Respondents _______________________________________________________ Decision of the Honourable Mr. Justice R. Paul Belzil _______________________________________________________ I. The Application [ 1 ] Mr.

Lymer has filed an application and Charter Notice for a Judicial Stay of Contempt Proceedings. [ 2 ] In support of the application, he cites

section 11(

b) of the Charter and Rule 4.31 of the Alberta Rules of Court . II. Factual Background [ 3 ] On March 4, 2011, the Applicant was deemed to have made an Assignment in Bankruptcy after his application to file a proposal under

Part Ill, Division I of the Bankruptcy and Insolvency Act, R.S.C., 1985, c. B-3 (“ BIA ”) was rejected. [ 4 ] On October 2, 2013, L.A. Smart, Q.C., Registrar in Bankruptcy, issued an Order compelling the Applicant and the “Lymer Companies” to prepare and file Affidavits of Records by January 2014.

[ 5 ] A further Order by Registrar Smart on March 7, 2014, gave specific direction on how the Affidavits of Records were to be organized. [ 6 ] The Affidavits of Records were not prepared by the deadline dates. [ 7 ] On June 11, 2014, the Respondents applied for an Order that the Applicant be declared in civil contempt of Court. [ 8 ] By decision dated November 6, 2014, Registrar Smart found the Applicant to be in contempt. Registrar Smart referred the issue of sanction for contempt to Justice D.

Lee of this Court, who was at the time a Case Management Justice with respect to this matter. [ 9 ] On January 15, 2015, Justice Lee issued an Order giving directions to assist the Applicant with purging his contempt. [ 10 ] On May 10, 2016, the Respondents filed new allegations of contempt and applied for a declaration that the Applicant had failed to purge his contempt. [ 11 ] By decision dated February 14, 2017, 2017 ABQB 110 , Registrar Smart found that the Applicant had not fully purged his contempt and dismissed all new allegations of contempt brought by the Respondents. [ 12 ] A sanction decision was issued by Justice Lee on October 22, 2018, 2018 ABQB 859 sentencing the Applicant to a term of incarceration. [ 13 ] After having served approximately two weeks in incarceration, the Applicant applied for a stay with the Alberta Court of Appeal and was released. [ 14 ] The sanction decision of Justice Lee was reversed by the Court of Appeal at 2020 ABCA 167 , which was released May 1, 2020. [ 15 ] At paragraph 86 of the Court of Appeal decision of the Court ruled that the question of sanction for contempt be remitted for a fresh hearing before a different Judge of the Court of King's Bench. [ 16 ] I was appointed Case Management Judge in September of 2022 and since that time I have met with counsel a number of times. [ 17 ] At the present time Ms.

Jonsson, represented by Mr. Kirwin, is the only creditor who is continuing to pursue Mr. Lymer for contempt sanctions. III. Discussion

A) Does

Section 11(

b) of the Charter Apply? [ 18 ]

Section 11(

b) of the Charter reads as follows: Any person charged with an offence has a right to be tried within a reasonable time. [ 19 ] The Applicant argues that the Charter does apply to civil contempt proceedings and cites several cases in support of this argument. [ 20 ] In Schitthelm v Kelemen, 2013 ABQB 42 at paras 23-29 Yamauchi J concluded that the Charter does apply to contempt proceedings. [ 21 ] The Applicant then argues that s 11(

b) of the Charter applies and more particularly the Supreme Court of Canada decision of R v Jordan , 2016 SCC 27 . [ 22 ] In Jordan the Court set a presumptive ceiling of 30 months for the completion of criminal trials following the laying of charges. [ 23 ] No authority has been cited in which the Jordan presumptive ceiling of 30 months has been applied to the sanctions phase of contempt proceedings. [ 24 ] In criminal proceedings the Crown carries the onus of advancing the prosecution.

At para 60 the Court recognized that defence delay must be subtracted from the period of delay being challenged. [ 25 ] On this evidentiary record, delay is attributable to both the Applicant and the creditors, but it is impossible to determine the proportion of delay attributable to each. [ 26 ] There is a further impediment to the Applicant’s argument that the Jordan analysis supports his position. While in criminal proceedings the Crown controls the prosecution, Mr. Lymer had the right at any time to

schedule a hearing in which he would seek to purge his contempt. To date, he has failed to do so. [ 27 ] In the result, I do not accept that the Jordan analysis can be invoked by the Applicant.

B) Rule 4.31

[ 28 ] Rule 4.31 reads as follows: Application to Deal with Delay 4.31(1) If delay occurs in an action, on application the Court may (

a) dismiss all or any part of a claim if the Court determines that the delay has resulted in significant prejudice to a party, or (

b) make a procedural order or any other order provided for by these rules.

(2) Where, in determining an application under this rule, the Court finds that the delay in an action is inordinate and inexcusable, that delay is presumed to have resulted in significant prejudice to the party that brought the application.

(3) In determining whether to dismiss all or any part of a claim under this rule, or whether the delay is inordinate or inexcusable, the Court must consider whether the party that brought the application participated in or contributed to the delay. [ 29 ] I have concluded that the application for a judicial stay should be dismissed for a number of reasons. [ 30 ] First, Mr. Lymer remains in contempt. The Court of Appeal set aside the Sanctions Order of Lee J but not the finding of contempt. There is no onus on the creditors to purge his contempt; that onus rests entirely on Mr. Lymer. [ 31 ] Second, since the Court of Appeal’s decision in 2020, Mr. Lymer has made no effort to

schedule a hearing in which he would seek to purge his contempt. [ 32 ] Third, on this evidentiary record, it is impossible to determine how much of the delay complained of is attributable to Mr. Lymer himself. Some delay is attributable to the creditors. [ 33 ] However, much of the delay in these proceedings is centered on the issue of disclosure of financial records. It is highly significant that the disputed records were created by Mr. Lymer and under his control. At no time did the creditors have control over them prior to the bankruptcy proceedings. [ 34 ] If Mr.

Lymer had made full disclosure of these records these proceedings could have been advanced much more expeditiously. Rule 4.31(3) is clearly engaged. [ 35 ] To date, no master list of financial records has been produced. It has not been determined whether the financial records produced to date are complete or not. This remains in dispute. [ 36 ] To complicate matters even further, Mr.

Lymer alleges that some financial records were lost while in the hands of the Inspectors or counsel for the creditors which is rigorously denied. [ 37 ] Fourth, on this evidentiary record it is impossible to determine whether there has been obstruction by Mr. Lymer in the production of financial records for himself and the Lymer companies. At a minimum, this issue needs to be fully explored. [ 38 ] Fifth, an order under Rule 4.31 is discretionary. [ 39 ] At the core of this ongoing litigation is what happened to the funds provided to Mr. Lymer by various creditors including Ms. Jonsson.

The creditors have never received a complete accounting for these funds. [ 40 ] Mr. Lymer argues that there is no money left. [ 41 ] Even if Mr. Lymer’s position is objectively correct, the issue of what happened to these funds remains unanswered. [ 42 ] In my view, it would be grossly unfair to Ms. Jonsson to grant a stay of proceedings in circumstances under which she has not yet received an explanation or accounting as to what happened to the funds invested by her with Mr.

Lymer. [ 43 ] Notwithstanding the protracted legal proceedings to date, it is impossible to determine whether her funds were lost due to mismanagement, malfeasance, or both. [ 44 ] It is noteworthy that Mr. Lymer was the guiding mind of this investment scheme. Ms. Jonsson had no control over decisions made. Only Mr. Lymer can explain what happened to her investment. [ 45 ] Sixth, as noted, Mr. Lymer filed an Annulment Application pursuant to

Section 181 of the Bankruptcy and Insolvency Act on June 22, 2023. [ 46 ] This application has not been argued let alone decided. The surviving creditors, with the exception of Ms. Jonsson, support the application. [ 47 ] As Case Management Judge it is not appropriate for me to speculate on the outcome of this application. [ 48 ] This pending application is an additional reason why this application should be dismissed. [ 49 ] Seventh, it is argued that Mr. Lymer has suffered prejudice because of “pending allegations of contempt by the Respondents.” [ 50 ] I do not accept this argument.

This is not a situation involving pending allegations of contempt, rather Lee, J found Mr. Lymer to be in contempt which finding was upheld by the Court of Appeal. The finding of contempt is still extant. As noted above, Mr. Lymer

could have scheduled a hearing to purge his contempt but has failed to do so. IV. Conclusion and Order [ 51 ] I have concluded that it would not be just and equitable to issue a judicial stay pursuant to Rule 4.31 in circumstances under which it is not possible to apportion blame for the delay between Mr. Lymer and the creditors. [ 52 ] There is simply too much uncertainty surrounding the delay issue to justify issuing a stay which would effectively terminate the claim of Ms. Jonsson with no explanation as to what happened to her investment. [ 53 ] The Application is dismissed. Costs may be spoken to.

Heard on the 11 th day of September 2023. Dated at the City of Edmonton, Alberta this 11 th day of October 2023. R. Paul Belzil J.C.Q.B.A. Appearances: Simon Renouf, K.C. Simon Renouf Professional Corporation for the Appellant Patrick D. Kirwin Kirwin LLP For Diane Jonsson