



COURT OF APPEAL FOR ONTARIO

CITATION: Shinder v. Shinder, 2018 ONCA 717

DATE: 20180831

DOCKET: C64169, C64727 and C64793

Pepall, Hourigan and Brown JJ.A.

BETWEEN

Randi Joy Cogan Shinder

Applicant (Respondent)

and

Neil Allen Shinder

Respondent (Appellant)

and

Solomon Shinder

Respondent (Appellant)

Harold Niman and Vanessa Amyot, for the appellant Neil Allen
    Shinder

Stephen Grant and Erin Crawford, for the appellant
    Solomon Shinder

Jaret Moldaver and Lindsay Konkol, for the respondent

Heard: January 25, 2018

On appeal from the order of Justice Janet Wilson of the Superior
    Court of Justice, dated July 13, 2017, with reasons reported at 2017 ONSC 4177,
    and from the costs order, dated August 1, 2017.



Pepall

J.A.:

INTRODUCTION

[1]

Neil and Randi Shinder were married on July 28,
    1996 and have two children, ages 21 and 20.  The couple separated on September
    9, 2009.  They entered into a Separation Agreement on June 25, 2012 and
    subsequent Minutes of Settlement varying that Agreement on February 27, 2014.

[2]

In 2016, Randi commenced proceedings against
    Neil and Neils father, Solomon (Sol), seeking, among other things, an order
    to set aside the Separation Agreement and the Minutes of Settlement.   She
    asserted that, when she entered into the Separation Agreement and the Minutes
    of Settlement, she was aware that Sol had established the Solomon and Zelaine
[1]
Shinder Canadian Grandchildren
    Family Trust (the Trust) but did not know that Neil was a beneficiary.  She
    asserted that his interest had not been disclosed.

[3]

Neil and Sol brought motions for summary
    judgment to dismiss Randis application.  The motions judge dismissed Neils
    motion for summary judgment, granted Sol partial summary judgment (insofar as
    he was not required to produce an Affidavit of Documents), and, although not
    requested, granted partial summary judgment in Randis favour on two issues. 
    First, the motions judge found that Neil deliberately failed to disclose his
    interest in the Trust to Randi.  Second, she found that Randi did not know of Neils
    interest in the Trust prior to entering into the Separation Agreement and the
    Minutes of Settlement, and as such, Neils defence that Randi knew of his
    interest could not succeed.

[4]

Neil and Sol appeal from this order.  For the
    reasons that follow, I would allow Neils appeal, with the exception of paragraph
    7 of the order below, which remains in effect, and which remits certain issues
    to mediation/arbitration as the parties agreed.  I would also allow Sols appeal.

FACTUAL BACKGROUND

[5]

At their date of marriage in 1996, Neil held 48
    common shares in Coofer Holdings Inc. (Coofer), a company controlled by Sol. Two
    years prior to the couples separation, Sol reorganized his holdings, including
    his shares in Coofer, initiated an estate freeze, and, with the consent of his
    two sons, established separate trusts (one Canadian and one American) for each
    of his sons families.  As found by the motions judge, Sols stated intention
    was to pass the benefit of future growth in his estate to his five
    grandchildren, including Randi and Neils two children.  The Canadian Trust
    holds common shares of Coofer.  As a result of this estate freeze, on January
    1, 2008, in exchange for the surrender of his common shares in Coofer, Neil
    received preference shares in Coofer having a fixed value of $1,106,784 with no
    voting rights and with dividends payable at the discretion of the Board of
    Directors.

[6]

While they were married, Randi and Neil
    developed companies that marketed and distributed beauty products.  Randi
    handled the creative component of the business including product development
    and marketing, and Neil handled the day-to-day operations and finances of the
    businesses.  The companies were very successful, and by the parties
    separation, they were worth tens of millions of dollars.

[7]

On separation, Randi and Neil proceeded to
    negotiate the terms governing the demise of their marriage.  Their financial
    affairs were complex, and they held significant assets.  Indeed, two years
    prior to their separation, they had sold one of their corporations for
    approximately $80 million.  Based on his income tax return for the year 2009,
    Neil had gross annual income in excess of $14 million, as did Randi.  Each of
    them retained experienced counsel and accountants to assist in identifying, evaluating,
    and dividing their holdings.

[8]

Randi commenced proceedings against Neil on
    December 7, 2010.  Among other things, she requested an unequal division of the
    parties net family property.  In her application, Randi noted that Neil had an
    interest in various entities including Coofer.  She stated that Coofer had
    undergone a reorganization; new shares had been issued; and [v]irtually no
    information has been provided about this reorganization.  She requested full
    and complete disclosure.

[9]

The parties exchanged Financial Statements.  Although
    he listed his share interest in Coofer and that he was a beneficiary of an
    entirely different Shinder Family Trust, Neil did not list his additional interest
    as a beneficiary under the Trust in his sworn Financial Statements, dated April
    5, 2011 and November 22, 2011.  He identified excluded property as having a nil
    value.  In his November 22, 2011 Financial Statement, he identified the
    $1,106,784 redemption value of the preferred shares in Coofer, noting that no
    dividends were expected to be paid.

[10]

On April 8, 2011, Randi and Neil consented to an
    order addressing disclosure and questioning at a Case Conference conducted by
    Herman J.  Neil was ordered to provide a disclosure request to Randi by April
    29, 2011; Randi was ordered to provide any additional disclosure requests to
    Neil by April 15, 2011; Neil was ordered to reply by May 15, 2011; and Randi
    was ordered to reply by May 30, 2011.  In addition, leave for questioning was
    granted.

[11]

Pursuant to that order, on April 14, 2011, Randis
    counsel, Annie Noa Kenet of the law firm Goldhart & Associates, wrote to Neils
    counsel, Harold Niman and Daryl Gelgoot, and requested itemized information identified
    by Andrew Freedman of Duff & Phelps, the accountant retained on behalf of
    Randi.

[12]

There were 131 items listed and numerous
    headings in the letter.  Among other things, Ms. Kenet sought rent rolls for
    certain properties at the date immediately preceding Coofers reorganization,
    at the date of separation, and currently.  Ms. Kenet also sought information on
    the Trust.

[13]

By letter dated May 13, 2011, Neils valuator,
    Linda Brent of Brent Valuations Inc., responded to the information identified by
    Mr. Freedman.  Her 23 pages of answers together with enclosures were forwarded
    to Mr. Gelgoot. The enclosures referred to in the responses were contained on
    an attached CD and were also listed on an accompanying index.  Ms. Brent wrote
    that, if Mr. Gelgoot had any questions, he should not hesitate to contact her.

[14]

Ms. Brent responded that the request for rent
    rolls before reorganization and currently was not relevant.  Further
    consideration would be given to the request if particulars of the purpose and
    its relevancy were provided.  Furthermore, the information was not in Neils
    possession but had been requested from Sol who had refused to provide it for reasons
    of confidentiality relating to the interests of third parties from whom consent
    was required.  As for the information as of the date of separation, Ms. Brent
    noted that Neil held fixed value preference shares and since his contingent
    interest in the Trust was received as a gift during marriage and was excluded
    property, the request was not relevant.  She reiterated that further
    consideration would be given to the request if particulars of the purpose and
    relevancy were provided and repeated the problem relating to Sol,
    confidentiality, and the need for third party consent.  Essentially the same
    answer was given in response to Ms. Kenets request for the fair market value
    of marketable securities held by Coofer.

[15]

Under the heading S&Z Canadian
    Grandchildren Family Trust, the following items were requested by Randis
    advisors: the Trust indenture; Trust returns for 2007, 2008, 2009, and 2010; financial
    statements for 2007, 2008, 2009, and 2010; and the ages and names of Sol and
    Zelaines grandchildren.

[16]

Ms. Brent identified and enclosed the Trust
    indenture for the S&Z Canadian Grandchildren Family Trust, dated December
    4, 2007.  The Trust indenture described Neil as an Original Trustee, along with
    Sol and Zelaine.  Both Neil and Randi were also described as beneficiaries,
    although Randi was a beneficiary only while she and Neil lived together in a
    conjugal relationship:

1.(c) beneficiary means the person or
    persons who are entitled to any benefit hereunder whether such benefit is
    contingent or absolute or whether such benefit is a right to receive income or
    capital or is an interest in income or capital of the trust fund, and without
    limiting the generality of the foregoing, shall include SOLOMON SHINDER,
    ZELAINE SHINDER, NEIL SHINDER, RANDI SHINDER and the children of NEIL SHINDER;

(i) provided that ZELAINE SHINDER shall
    only be a beneficiary of this Trust upon the death of her husband, SOLOMON
    SHINDER;

(ii) and provided that the spouse of NEIL
    SHINDER shall only be a beneficiary of this Trust while she and NEIL SHINDER
    live together in a conjugal relationship[.]

In addition, the Trust Indenture
    provided that any beneficiarys interest in the Trust property or its interest
    was excluded property for family law purposes:

22. The Interest of any beneficiary in any
    property of the Trust, any income from property of the Trust, any accretion in
    value of property of the Trust and any property into which the above mentioned
    property can be traced, including any income from the traced property, shall
    constitute his or her exclusive property and
shall be excluded from his or
    her net family property
, as such term is defined in the
Family Law Act
,
    R.S.O. 1990, c.F.3 as amended, and shall not form part of any present or
    deferred community of property or value shareable with his or her spouse under
    the laws of any jurisdiction. [Emphasis added.]

[17]

In response to the request for production of the
    Trust returns, Ms. Brent responded that no tax returns had been filed, but she
    enclosed an exemption for fiscal years 2009 and 2010.  She stated that no
    financial statements had been prepared for the years 2007 to 2010.  She
    provided the ages and names of the children of Neil and Randi but stated that
    those of the other grandchildren were not relevant.

[18]

As mentioned, in her letter, Ms. Brent also
    described Neils interest in the trust as contingent and as excluded
    property.

[19]

In her cross-examination for the purposes of the
    summary judgment motion, Randi stated that she did not read Ms. Brents letter.

[20]

In his Affidavit sworn June 17, 2011, Neil
    repeated some of Ms. Brents responses and stated that his contingent interest
    in the Trust was received as a gift during marriage, was excluded property, and
    therefore not relevant.

[21]

In an Affidavit sworn by Sol on August 3, 2011,
    he attached a corporate chart listing Neil as one of the beneficiaries of the
    Trust.  He also stated that the ultimate residual beneficiaries of the Trust
    were Neil and Randis children.

[22]

Randis lawyers and Mr. Freedman did not pose
    any follow-up questions on the Trust.  Nor did anyone else on Randis behalf.

[23]

Neil and Sol agreed to produce documentation on
    Coofer but, before doing so, asked that Randi sign a confidentiality
    agreement.  She refused to do so.  Ultimately, as mentioned, on June 25, 2012,
    the parties entered into a Separation Agreement.  It provided that Randi and
    Neil had each investigated the others financial circumstances to his or her
    satisfaction.  They subsequently varied their Agreement and entered into
    Minutes of Settlement, dated February 27, 2014, following a mediation before
    Alfred Mamo.

[24]

On September 1, 2016, Randi commenced
    proceedings against Neil and Sol. Among other things, she sought an order setting
    aside the Separation Agreement and the Minutes of Settlement. She asserted that
    Neil had failed to truthfully disclose his assets.  If the Separation Agreement
    and the Minutes of Settlement were not set aside, or in any event, Randi
    claimed damages for conspiracy to commit fraud, deceit, and punitive damages of
    $250,000.  As revealed by her Amended Application, the factual basis for these three
    claims mirrored her claim that the two agreements be set aside for
    non-disclosure. Both parties and the motions judge approached the summary
    judgment motions on the basis of non-disclosure.

[25]

In her Amended Application, Randi also sought
    other relief including damages for various breaches of the Settlement Agreement
    and the Minutes of Settlement relating to removal of certain household
    contents, child support, section 7 expenses, RESPs and Bonds in favour of the
    two children of the marriage, failure to share tax benefits, and damages for
    conversion relating to household contents.

MOTIONS JUDGES DECISION

[26]

On the summary judgment motions brought by Neil
    and Sol, the motions judge identified the only issue for consideration as being
    whether there was a triable issue that Neil had failed to disclose that he was
    a beneficiary of the Trust.  She noted that, under s. 56(4)(a) of the
Family
    Law Act
, R.S.O. 1990, c. F.3, the court may set aside a domestic contract
    if a party has failed to disclose to the other significant assets existing when
    the domestic contract was made.  She went on to emphasize the need to make
    disclosure and stressed that accurate and complete Financial Statements are
    crucially important and particularly so in complex cases.  She found that Neil
    had failed to disclose his interest in the Trust in his Financial Statements. 
    She was unable to determine from the evidence before her whether Randis
    counsel, accountant or advisors were aware of the terms of the Trust.  However,
    relying on
Virc v. Blair
, 2014 ONCA 392, 119 O.R. (3d) 721, she
    determined that there had been non-disclosure, and Neil and Sol had failed to
    show that Randi knew of Neils interest in the Trust.

[27]

The motions judge went on to conclude that it
    was unnecessary to have a trial on the issue of non-disclosure.  She dismissed
    Neils motion for summary judgment and granted Randi partial summary judgment
    on two issues: (i) that Neil had deliberately failed to disclose his interest
    in the Trust to Randi; and (ii) that Randi did not have actual knowledge of the
    non-disclosure when she entered into the June 25, 2012 Separation Agreement. 
    Neils attempt to defend the action on the grounds of Randis knowledge could
    not succeed.  The motions judge left for further hearing, following full
    disclosure by Neil, whether Neils failure to disclose that he was a
    beneficiary of the Trust was material or significant non-disclosure within the
    meaning of s. 56 of the
Family Law Act
.  In addition, Neil was to file
    a sworn Financial Statement, and he was to answer refusals arising from his
    cross-examination and produce the documents requested by Randi.  The motions
    judge also ordered that unless the Separation Agreement was set aside on the
    ground of non-disclosure, all of the other issues raised (section 7 expenses,
    child support, contents, and any other alleged breaches related to the failure
    to share tax benefits, etc.) were to be dealt with by the mediation/arbitration
    process stipulated in the Separation Agreement.

[28]

As for Sols request for summary judgment, the
    motions judge found that, although he was aware that Neil was a beneficiary of
    the Trust, Sol had failed to squarely reveal the truth.  In his Affidavit, Sol
    had stated that the ultimate residual beneficiaries of the Trust were Neil and
    Randis children.  He had attached a corporate chart that showed Neil and Randi
    as Trust beneficiaries, but the motions judge stated that it was in fine print
    and barely legible.

[29]

The motions judge did not expressly dismiss
    Sols motion for summary judgment and such a dismissal is not found in the
    order.  It would appear that the motions judge implicitly dismissed his
    motion.  She also ordered Sol to answer refusals from his cross-examination and
    to produce the documents requested by Randi.  The motions judge dismissed
    Randis request for Sol to file an Affidavit of Documents with respect to
    assets owned by Neil at marriage and separation.

[30]

The motions judge invited the parties to bring a
    motion before her to address any objections about the scope of disclosure
    relating to the refusals.  Both Neil and Sol brought motions, and the motions
    judge made a further order clarifying and amplifying the scope of the
    information to be provided.

[31]

The motions judge subsequently ordered Neil and
    Sol to pay Randis costs fixed in the amount of $70,000, 75% to be paid by Neil
    and 25% to be paid by Sol.

APPEAL PROCEEDINGS

[32]

Both Neil and Sol sought to appeal from the
    motions judges July 13, 2017 order and her order on costs.  Leave to appeal
    was requested of the Divisional Court, and Notices of Appeal were also filed in
    the Court of Appeal.

[33]

The Divisional Court granted leave to appeal
    from paragraph 1 of the July 13, 2017 order (dismissing Neils summary judgment
    motion); paragraph 3 (requiring him to file a Financial Statement); and
    paragraph 4 (requiring him to answer refusals from his cross-examination).  The
    Divisional Court would have granted leave to appeal paragraphs 2 (granting
    Randi partial summary judgment on the issues of Neils non-disclosure and
    Randis lack of actual knowledge) and 7 (on sending all of the other issues
    raised to mediation/arbitration as provided for under s. 6 of the Separation
    Agreement in the Dispute Resolution section) but for the fact that they were
    final in nature.  The Divisional Court also granted leave to appeal the costs
    order of August 1, 2017.

[34]

On consent, Hourigan J.A. consolidated Neil and
    Sols Divisional Court appeals with Neils appeal in the Court of Appeal.

[35]

On appeal, the appellants did not press the motions
    judges referral of all other issues to a mediator/arbitrator (Alfred Mamo) in
    either their factums or oral argument and no cross-appeal is taken with respect
    to that aspect of the motions judges decision.

ISSUES

[36]

On appeal, in essence, Neil raises three
    issues.

[37]

First, he submits that the motions judge made
    palpable and overriding factual errors in finding that he intentionally failed
    to disclose his interest in the Trust when the Separation Agreement and Minutes
    of Settlement were being negotiated, in finding that Randi had no knowledge of
    his interest in the Trust prior to entering into the Separation Agreement, and
    in granting partial summary judgment to that effect in Randis favour.  Second,
    he argues that the motions judge erred in law in dismissing his motion for
    summary judgment.  Third, he submits that the motions judge erred in awarding
    Randi costs of the motions in the sum of $70,000 against Neil and Sol.

[38]

For his part, Sol raises four issues on appeal.

[39]

Sol submits first that the motions judge erred
    in granting partial summary judgment in Randis favour and in dismissing his motion
    for summary judgment on the basis that the motions judge failed to consider the
    relevant law in determining the validity of Randis claims against him; second
    that
s
he erred in finding that Neil (and Sol) had intentionally failed
    to disclose his interest in the Trust; and third that
s
he erred in awarding
    costs to Randi.  Fourth, he takes issue with the motions judges order that he
    provide answers to refusals from his cross-examination and make production of
    documents.

ANALYSIS

[40]

Section 56(4) of the
Family Law Act
permits a court, on
    application, to set aside a domestic contract or a provision in it,

(a)

if
    a party failed to disclose to the other significant assets, or significant
    debts or other liabilities, existing when the domestic contract was made;

(b)

if
    a party did not understand the nature or consequences of the domestic contract;
    or

(c)

otherwise
    in accordance with the law of contract.

[41]

A domestic contract includes a separation
    agreement.

[42]

Section 56(4)(a) permits but does not require a
    court to set aside a domestic contract.  Put differently, the courts inquiry does
    not end with a finding of failure to disclose significant assets or debts. 
    Rather, the court must also consider whether it is appropriate to exercise its
    discretion in favour of setting aside the agreement:
LeVan v. LeVan
, 2008
    ONCA 388, 90 O.R. (3d) 1, at para. 51.  As with all matters of statutory
    interpretation, provisions should be interpreted in a way that accords with the
    objectives of the Act.

[43]

As stated in its preamble, the objectives of the
    Act include providing for the orderly and equitable settlement of the affairs
    of the spouses upon the breakdown of the partnership.

[44]

The primary issue in this case, as framed by the
    parties and the motions judge, is whether, despite the omission in the sworn
    Financial Statements, Neils interest in the Trust was nonetheless disclosed.  Second,
    did Randi have knowledge of Neils interest in the Trust; and third, in any
    event, was Neils interest in the Trust significant?

(a)

Neils Grounds of Appeal

(i)

Disclosure and Randis Knowledge

[45]

Neils interest in the Trust as a named
    beneficiary  and not just the shares in his own name that he did disclose should
    have been listed on his sworn April 5 and November 22, 2011 Financial
    Statements.  That is, while he did disclose both his common and preference
    shares in Coofer in both the April and November financial statements as well as
    income received from that company and from Esbak  another of his fathers
    companies  he should have included his interest as a named beneficiary under the
    Trust under the heading of
excluded
property.

[46]

The parties exchanged financial statements and
    then consented to an April 8, 2011 court order that governed their mutual
    disclosure responsibilities.  It was implicit from this order that further
    disclosure was anticipated.  Indeed, what followed was an exchange of
    correspondence and requests for further disclosure between the parties counsel
    and their financial advisors that encompassed details about the Trust.

[47]

As mentioned, in her May 13, 2011 letter, Ms.
    Brent responded to the correspondence sent by Randis lawyers and the questions
    asked by Randis accountant.  She provided the Trust indenture to counsel for Randi. 
    It described the nature of Neils interest in the Trust as did Ms. Brent.  She
    described his interest as both contingent and excluded.  She confirmed that no
    tax returns had been filed and that no financial statements had been prepared
    and provided the names and ages of Neil and Randis children.

[48]

In the face of this disclosure, the motions
    judge's findings cannot withstand scrutiny.‎ Moreover, and significantly,
    the motions judge erred in her analysis of Randis knowledge of the Trust.

[49]

The motions judge concluded that Randi was
    unaware that Neil was a named beneficiary of the Trust and stated,
at para. 133, that [i]n these circumstances, it is
    not necessary to review what her counsel or accountant did or did not know.

[50]

This was in error.  The general rule is that, in
    the ordinary case, the knowledge of an agent is imputed to its principal, there
    being a presumption that an agent will communicate his knowledge to the
    principal because it is his duty to do so:
Vescio v. Peterman
(1999),
    45 O.R. (3d) 613 (C.A.), at para. 2, citing
Durbin v. Monserat Investments
    Ltd
.
(1978), 87 D.L.R. (3d) 593 (Ont. C.A.), at p.
    595.    As in
Vescio
, this rule also applies to imputing knowledge of
    a solicitor to his or her client. As Rowe J.A. (as he then was) stated in
Acharya
    Holdings Ltd. v. Standard Trust Co.
, 2014 NLCA 13, 346 Nfld. &
    P.E.I.R. 348, leave to appeal refused [2014] S.C.C.A. No. 187, at para. 16:

It is a settled principle of law that the
    knowledge of the solicitor is imputed to his or her client:
Rolland v. Hart
(1871), L.R. 6 Ch. App. 678 (Eng. L.C.), at 681-82. (See also:
Stoimenov v.
    Stoimenov
(1985), 50 O.R. (2d) 1 (Ont. C.A.). at paragraph 11;
Beechwood
    Cemetery Co. v. Graham
(1998), 117 O.A.C. 59 (Ont. C.A.), at paragraph 53.)

[51]

The Court of Appeals decision in
Anderson
    v. McWatt
, 2016 ONCA 55, relied upon by Randi, in no way detracts from
    this principle.  Instead, that was a case where the wifes counsel was found
    not to have knowledge of an asset that the husband fraudulently asserted was
    not in his name.  The Court of Appeal merely confirmed that the statement made
    by the wifes counsel in a letter that the wife may have a claim against the
    property, depending on what emerged in the examination of the husband, did not
    amount to knowledge that the husband in fact owned the property in question.

[52]

It was a palpable and overriding error for the
    motions judge to state that she was unable to determine whether Randis
    counsel, accountant or advisors were aware of the terms of the Trust.  There can
    be no real issue that disclosure was made to Randis counsel and financial advisor;
    indeed among other things, they were given the Trust indenture that clearly
    identified Neil as a Trust beneficiary, financial statements for Coofer for the
    years preceding the couples separation, and a Coofer valuation report prepared
    to effect the estate freeze and to value Neils shares in Coofer.  Furthermore,
    this was not disclosure that was in any way buried.  The Trust was specifically
    mentioned in correspondence between counsel and the financial advisors.  Randi
    was deemed to have knowledge as a result of the knowledge of her counsel.

[53]

In resolving their financial issues arising from
    marital breakdown, these parties received advice from highly experienced
    advisors.  With the benefit of that advice, they settled their affairs. In
    their separation agreement, both Randi and Neil stated that each had
    investigated the others financial circumstances to his or her satisfaction. 
    They consented to an order governing the process, and through her counsel and
    financial advisors, Randi is deemed to have had knowledge of Neils interest in
    the Trust.

[54]

Neils omission of his interest in the Trust in
    his November, 2011 Financial Statement does not alter these facts.  Although he
    ought to have included this interest in that portion of the Financial Statement
    that addresses excluded property, its omission cannot serve to turn actual
    disclosure and Randis knowledge into non-disclosure for the purposes of
    s.56(4) of the
Family Law Act
.

[55]

Lastly, the motions judges reliance on
Virc
    v. Blair
was misplaced.  That case involved undisputedly significant
    non-disclosure. This is not that case.

[56]

It follows that the motions judge erred in
    granting partial summary judgment to Randi.  I would set aside paragraphs 2 and
    3 of the motions judges order of July 13, 2017.

(ii)

Significance of the Asset

[57]

Even if the omission from the Financial
    Statements could be characterized as non-disclosure, s. 56(4) also requires the
    court to consider whether the implicated asset is significant.  The motions
    judge did not engage in this part of the analysis.  Instead, she deferred the
    issue to be addressed in the future without considering whether there was a
    genuine interest requiring trial.

[58]

Here, there was not a genuine issue requiring a
    trial.  Section 4(2) of the
Family Law Act
excludes from net family
    property, and therefore from equalization, any property acquired by gift or
    inheritance from a third person after the date of the marriage. The Trust 
    comprised Sols property and Neils common shares in Coofer that had originally
    been given to him by Sol and then exchanged for preference shares that were
    disclosed to Randi and included in both of Neils Financial Statements.  In the
    face of the disclosure of these Coofer shares, any additional benefits Neil
    might receive under the Trust would constitute a gift or inheritance acquired
    after the date of the marriage and hence would have to constitute excluded
    property as defined under the
Family Law Act
.  Although not
    determinative, this is consistent with s. 22 of the Trust Indenture, which
    declares any benefit received by any beneficiary under the Trust to be excluded
    property for family law purposes.  Ms. Brent responded to the questions posed
    by Randis advisors and also noted that Neils interest in the Trust would have
    to constitute excluded property.  One may reasonably conclude that this factor
    informed the decision made on Randis behalf to forego further questioning on
    the Trust despite Ms. Brents invitation for particulars on the purpose and
    relevancy of the request.

(iii)

Neils Motion for
Summary
Judgment and the Interlocutory Provisions of the Order Below

[59]

Neil also asserts that the motions judge erred
    in refusing to grant his motion for summary judgment.  In his notice of motion seeking
    summary judgment, Neil had requested that Randis Application be dismissed in
    its entirety.

[60]

Given the process and Randis knowledge, there
    is no genuine issue requiring a trial on the issue of non-disclosure.  It
    follows that there could be no genuine issue requiring a trial for damages for
    conspiracy to commit fraud, deceit or punitive damages, all of which rely on
    the same constellation of facts as set out in Randis Amended Application. I
    would grant Neils request for summary judgment in this regard.  As such, I
    would dismiss the claims asserted in paragraphs 1, 2, 11, 12, and 13 of Randis
    Amended Application.

[61]

As for the other issues raised by Randi, the
    motions judge stated, at para. 7 of her order:

Unless the Separation Agreement is set aside
    in its entirety on the narrow ground of the non-disclosure of Neils interest
    in the Trust, all of the other issues raised (section 7 expenses, child
    support, contents, and any other alleged breaches related to failure to share
    tax benefits, etc.) shall be dealt with by the Mediation/Arbitration process
    stipulated in the Separation Agreement.

[62]

I see no reason to interfere with this
    disposition.  The Separation Agreement remains in force as do the Minutes of Settlement.
     All other outstanding issues should be resolved by the s. 6 mediation/arbitration
    process in the Separation Agreement and s.20 of the Minutes of Settlement.

[63]

I would also allow Neils appeal from the
    interlocutory provisions, at para. 4, of the order under appeal.  They derive
    from Randis claim that the Separation Agreement and Minutes of Settlement be
    set aside on the basis of non-disclosure, which cannot succeed.  Thus, they
    have no further relevance.

(iv)

Costs

[64]

Neil asks that the costs award of $70,000 in
    Randis favour be set aside, and that the costs below and of the appeal be
    awarded to him instead.  Generally, in family and other civil proceedings,
    costs follow the event.  Certainly, Neil should be entitled to his costs of the
    appeal and the Divisional Court proceedings.

[65]

I would, therefore, order those costs to be paid
    by Randi to Neil fixed in the amount of $30,000 on a partial indemnity scale,
    inclusive of disbursements and applicable tax.

[66]

As for costs below, I would set aside the order
    for $70,000 in favour of Randi, and order Neil and Randi to bear their own costs
    of those proceedings.  Although Neil was successful, given the omissions in his
    2011 Financial Statements, it is fair and reasonable that Neil bear some of the
    burden for the proceedings.

(b)

Sols Grounds of Appeal

[67]

As mentioned, Sol submits that the motions judge
    erred (i) in granting partial summary judgment in Randis favour and failing to
    grant summary judgment in his favour because the motions judge did not apply
    the relevant law to his motion for summary judgment; (ii) in finding that Neil intentionally
    failed to disclose his interest in the Trust; and (iii) in ordering costs of
    the motion in the amount of $70,000 against Sol and Neil.   As mentioned, he
    also appeals the interlocutory provisions of the motions judges order.

[68]

Since the second ground of appeal overlaps with
    Neils and has already been addressed, I will only discuss the other three
    grounds.

[69]

I agree with Sol that the motions judge erred in
    her treatment of his motion for summary judgment.

[70]

The motions judge did not consider the requisite
    tests to establish the claims asserted against Sol: conspiracy to commit fraud,
    deceit, and punitive damages. If she had, it would have been clear that these
    tests could not be met based on the record before her and that there was no
    genuine issue requiring a trial.

[71]

On a motion for summary judgment, each party has
    to put their best foot forward in relation to any material issues to be tried:
Sanzone v. Schechter
, 2016 ONCA 566, 402 D.L.R. (4th) 135, at para.
    32.
Here, Randi did not adduce evidence that would support the requisite elements of
    the causes of action and claims asserted against Sol.
On
    the conspiracy to commit fraud claim, there simply is no evidence to sustain
    the requirement that the course of conduct adopted by Sol had the predominant
    purpose of causing injury to Randi or that his conduct was unlawful, directed
    towards Randi, and in circumstances where he should have known that injury to
    her would likely result.  See:
Cement Lafarge v. B.C. Lightweight Aggregate
,
[1983] 1 S.C.R. 452.  Sols intention, as found by the motions judge, was to
    implement an estate freeze to organize his corporate and personal affairs to pass
    on the benefit of future growth to his grandchildren.  He effected the freeze
    two years before Randi and Neil separated and initially, she too was a
    beneficiary.  Moreover, no injury ensued. Similarly, with the claim of deceit,
    this claim cannot be sustained.  I have already concluded that Neils interest
    in the Trust was disclosed.  In the light of this conclusion, a finding of
    deceit could not be grounded in Sols statement that the ultimate beneficiaries
    were Neil and Randis children coupled with the corporate chart that disclosed
    Neils interest. Lastly, again there is no evidence to support Randis claim of
    punitive damages.  No finding could be made that Sols conduct was malicious,
    oppressive and high-handed such that it offends the courts sense of
    decency:
Whiten v. Pilot Insurance Co
.
, 2002 SCC 18, at para.
    36.

[72]

It follows that Sols motion for summary
    judgment should have been granted.  Given this outcome, I would also allow
    Sols appeal from the interlocutory provisions of the order.

DISPOSITION

[73]

For these reasons, I would allow Neils appeal
    in part.  That is, paragraph 7 of the underlying order shall remain in effect
    to the extent that it permits Randi to pursue the other issues she raises (as
    described by the motions judge, section 7 expenses, child support, contents, as
    well as any other alleged breaches related to a failure to share tax benefits,
    etc.) through the mediation/arbitration process stipulated in the Separation
    Agreement.  I would set aside the partial summary judgment in favour of Randi, dismiss
    Randis claim that the Separation Agreement and Minutes of Settlement be set
    aside on the basis of non-disclosure of Neils interest in the Trust, and set
    aside the costs order below.  I would order Neil and Randi to bear their own
    costs of the proceedings below and would order Randi to pay Neils costs of the
    appeal, including the Divisional Court proceedings, on a partial indemnity
    scale fixed in the amount of $30,000, inclusive of disbursements and applicable
    tax.

[74]

I would allow Sols appeal.  I would order Randi
    to pay $20,000 in costs of the proceedings below.  In addition, she is to pay costs
    of the appeal, including the Divisional Court proceedings, on a partial
    indemnity scale fixed in the amount of $20,000, inclusive of disbursements and
    applicable tax.  Although fraud was pleaded, it played a minimal role in the
    argument and analysis, and I am satisfied that a partial indemnity costs award
    is fair and reasonable in the circumstances.

Released: DMB AUG 31 2018

S.E. Pepall J.A.

I agree. C.W. Hourigan
    J.A.

I agree. David Brown
    J.A.





[1]

Sols wife.


