Blaxland et al v. Fuller Date:, 2003 BCSC 690

Citation: Blaxland et al v. Fuller Date: 20030326 2003 BCSC 690 Docket: S010324 Registry: Vancouver IN THE SUPREME COURT OF BRITISH COLUMBIA Oral Reasons for Judgment Mr. Justice McEwan March 26, 2003 BETWEEN: michael blaxland and EDWARD GEORGE RALFE PLAINTIFFS AND: TIMOTHY MARK FULLER DEFENDANT Counsel for the Plaintiffs M. Blaxland Counsel for the Defendant J.R. Sandrelli [ 1 ] THE COURT: In this matter the defendant owes the plaintiffs on a judgment for fraud something in the order of half a million dollars.

The plaintiffs have attempted to collect on this judgment in various ways over a period of approximately 10 years. [ 2 ] The matter is presently before the court following the recent history, which commences with Registrar Scarth on May 27th, 2002 pronouncing an order that the defendant pay the sum of $2,000 per month to the plaintiffs.

That is obviously not a sum of money that retires the principal of the liability, and amounts to something like a gesture toward the overall obligation he has to the plaintiffs. [ 3 ] On December 16th, 2002, the plaintiffs sought an Order for Committal, pursuant to Rule 42(35), before Madam Justice Kirkpatrick on the basis that the money ordered to be paid pursuant to the order of District Registrar Scarth had not been paid.

I am advised that the arrears up to a month ago or so are in the order of $27,000 under that order, inclusive of an amount allocated to costs. [ 4 ] Madam Justice Kirkpatrick was moved to adjourn the application for an Order for Committal pending the outcome of an application by the defendant to vary the order of District Registrar Scarth. That variation application was to be heard January 20th, 2003.

The terms upon which the order of committal was adjourned included a number of explicit directions as to the production of documents, which I will broadly characterize as documents which would give evidence as to the means and circumstances of the defendant. [ 5 ] The defendant failed to appear on January 20th, 2003. [ 6 ] On a renewed application for an Order for Committal before Mr.

Justice Stewart on February 21st, 2003, the defendant was found to have failed to provide good cause why he had not complied with the order for payment pronounced by District Registrar Scarth on May 27th, 2002 and that he knew of that order. He was committed to prison for 40 days, which is the maximum period of time allowed under Rule 42(36). [ 7 ] A review of the transcript on that occasion shows that Mr. Fuller had appeared unequipped, in the view of the presiding Supreme Court Justice, to show cause because he had no evidence. He appeared without affidavit material.

I am sure that, on that occasion as well, the history of the matter as apprehended by the presiding Supreme Court Justice was fully in his mind, and had something to do with the period of incarceration ordered. [ 8 ] On March 4th, 2003, on an ex parte application, the defendant came before me, accompanied by counsel and fortified with affidavit material.

The plaintiffs had been notified that there was an intention to bring this application ex parte and participated to the limited extent of filing a letter for the court's consideration. [ 9 ] On that occasion I was moved to grant the application on the limited basis that the Order for Committal would be stayed until March 12th, 2003. I ordered a further hearing at ten o'clock a.m. on that date, at which time the defendant was advised he was expected to show cause why he should not be reincarcerated.

He was also ordered to show full compliance with the order of Madam Justice Kirkpatrick of December 16th, 2002. [ 10 ] The primary basis on which that order was made was that on the basis of the material which was then produced, I could not be satisfied that Mr. Fuller was in a position to pay, and it appeared to me that the best alternative was to permit him to be discharged from custody, on the limited basis that I ordered, to permit him to assemble the documentation which was ordered by Madam Justice

Kirkpatrick.

The matter was subsequently adjourned by consent from the March 12th, 2003 date to this date, March 26th, 2003. [ 11 ] What has been produced to me today is a large volume of material, which certainly goes a long way toward compliance with the specific documentation ordered by Madam Justice Kirkpatrick, if it does not technically comply with all of what she ordered. [ 12 ] It is clear that, in the circumstances of this case, the records that have been produced to date may not be sufficient to satisfy the District Registrar, or the plaintiffs for that matter, as to the actual means and circumstances of the defendant. [ 13 ] The defendant has done business through a corporation called Circo International Products Group Incorporated.

Its most significant recent activity was the production of a form of rattle or noise maker for the Olympics in Utah in 2002. It appears that there may be some assistance to be gained, in assessing the entire financial picture of the defendant, in the production of all of the records related to that company, including its corporate records and the records for the production and distribution of the products of the company. [ 14 ] The position of the plaintiffs in this case is that this is insufficient, that the order of Mr.

Justice Stewart should be reinstated so that the remaining time on the committal order runs, and that to fail to make such an order would be to bring the administration of justice into disrepute. They say this on the basis that Mr. Fuller has a history of non-compliance with court orders. [ 15 ] The concern I have is expressed in the case Microwave Cablevision Ltd. v. Harvard House Ltd. 1981 CanLII 657 (BC SC) , [1981], 28 B.C.L.R. 393, 123 D.L.R. (3rd) 761 (S.C.); reversed 1982 CanLII 447 (BC CA) , 132 D.L.R. (3rd) 570 at page 575-76, [1981] B.C.D. (civ.) 3867-02, 3568-02 (C.A.).

The proposition in that case that is cited in the British Columbia Annual Practice under Rule 49(35) is this: This subrule is not concerned with execution and imprisonment for debt, it deals with contempt for refusing or neglecting to carry out a court order and with imprisonment for contempt. The power to take a person in execution has not been kept alive. What has been kept alive is the power to commit for contempt for refusal or neglect to obey an order. Mere non-payment does not justify imprisonment. It must be shown that the order to pay has not been obeyed and the debtor knew of the order.

Then the debtor must show good cause why he should not be committed. Failure by the debtor to obey an order which he is not able to obey would not justify committal absent some other ingredient of contempt. [ 16 ] It seems to me, as I have said earlier in this proceeding, that the order sought is not intended as a form of punishment, but as a means of securing compliance with court orders. The difficulty I have in this case, on the material before me, is it is not at all clear that Mr.

Fuller is in a position to pay, and if that is not clear, it seems to me the court should be very careful about making a committal order. [ 17 ] In saying that, I wish to emphasize that I do not imply any criticism of the original committal order which was made, which, it seems to me, occurred on the basis of that judge's apprehension of the evidence, and the evidence before him was not nearly as developed as the evidence before me. [ 18 ] My view of this case is that Mr.

Fuller should be bringing an application before the District Registrar to fix the appropriate amount based on his ability to pay, as was anticipated on January 20th, 2003. [ 19 ] It is no part of my consideration here, inasmuch as it seems to me it was dealt with in the original Order for Committal, to note that the defendant failed appear on that occasion and certainly exacerbated the situation he finds himself in by doing that.

It does, nevertheless, seem to me that the proper thing to do in this case is to permit there to be a further period of time for the defendant to comply with an order for even further production than that given by Madam Justice Kirkpatrick, so that his entire situation may be before the court before any further order is made respecting the Order for Committal. [ 20 ] Accordingly, I will stay the order for a further period of time to April 23rd, 2003. The order I made on the last occasion is, therefore, extended.

On that occasion, the defendant will be expected to show cause why he should not be reincarcerated, in terms of whether he has by then fully complied with the direction of this court that he produce every document or record in his possession in addition to those ordered by Madam Justice Kirkpatrick, specifically the records of the transactions in which the company Circo was involved, including all the invoicing for the product that it resold and the receipts it obtained from its agents, and all other documents that pertain to the transaction of business by that corporate entity. [ 21 ] The anticipation I would have is that at that time, if there has been full documentary compliance, the stay would be extended to the extent that an application before the District Registrar for a variation could be accommodated.

If there has not been compliance by that date, Mr. Fuller will face the peril which has hung over him since I made the first order on March 4th, 2003, which is that he would be reincarcerated in accordance with Mr.

Justice Stewart's Order of Committal. [ 22 ] Anything further? [ 23 ] COUNSEL: No, My Lord. [ 24 ] COUNSEL: I guess I'll make a pitch for some cost order and I think he should be -- should be ordered to pay some costs. [ 25 ] THE COURT: What I will do is deal with costs -- since I remain seized of the matter, I'll deal with costs when this matter is finally dealt with by me. [ 26 ] COUNSEL: Thank you, My Lord. “T.M. McEwan, J.” The Honourable Mr. Justice T.M. McEwan