



COURT OF APPEAL FOR ONTARIO

CITATION: Manchanda v. Thethi, 2016 ONCA 909

DATE: 20161130

DOCKET: C62303

Gillese, Benotto and Roberts JJ.A.

BETWEEN

Jastinder Manchanda

Applicant

(Respondent on Appeal)

and

Sukhvir Thethi

Respondent

(Appellant)

Richard Parker, for the appellant

Evelyn Rayson and Michael Weisbrot, for the respondent

Heard: November 22, 2016

On appeal from the order of Justice F. Myers of the Superior
    Court of Justice, dated June 9, 2016.

ENDORSEMENT

[1]

The appellant appeals the order of the motion judge striking his
    pleadings for failure to comply with court orders and allowing the respondent
    to amend her application.

[2]

The parties separated in 2013 after a ten-year marriage. They have no
    children. Shortly after separating, they embarked upon high conflict
    matrimonial litigation. There have been countless court attendances resulting
    in court orders from at least ten different judges.

[3]

Three court orders specifically required the appellant to deposit rental
    income, which he collects from jointly owned property, into a specified joint
    account: the order of Jarvis J., dated December 2, 2013; the order of Frank J.,
    dated November 26, 2014; and the order of Horkins J., dated June 4, 2015.  It
    is not in dispute that the appellant breached these orders.

[4]

There were also orders for financial disclosure. In October 2013, the
    parties agreed to a consent order for disclosure. In March 2015, the respondent
    sent the appellant a request for information consisting of 374 items. In
    response, the appellant sent an affidavit with documents. He claimed that this
    provided disclosure, while the respondent said some issues had not been
    addressed. Horkins J. went through the requests and affidavit of documents and
    made detailed orders for the parties to provide various documents. The
    appellant provided an affidavit, sworn April 15, 2016, claiming that the
    attached documents constituted compliance with the order of Horkins J.

[5]

The respondent disagreed and moved to strike his pleadings under r. 1(8)
    of the
Family Law Rules
, O. Reg. 114/99. The respondent also sought
    leave to amend her application to include a claim for constructive trust on the
    matrimonial home owned by the appellant.

[6]

The motion judge struck the appellants pleadings and allowed the
    respondent to amend her application.

[7]

The appellant submits that the motion judge erred in using the
    extraordinary remedy of striking his pleadings. He submits that such draconian
    measures should only be used in limited and exceptional circumstances, and when
    no other remedy would suffice:
Chiaramonte v. Chiaramonte
, 2013 ONCA
    641, 36 R.F.L. (7th) 11;
Purcaru v. Purcaru
, 2010 ONCA 92, 75 R.F.L.
    (6th) 33. He argues that his conduct was insufficiently egregious to justify
    striking his pleadings.

[8]

We do not agree, for two reasons.

[9]

First, the circumstances were exceptional and egregious. In
Kovachis
    v. Kovachis
, 2013 ONCA 663, 36 R.F.L. (7th) 1, this court allowed an
    appeal from an order striking the pleadings of a non-compliant party because
    the motion judge had failed to: (i) consider the substantial disclosure already
    made; (ii) itemize what disclosure the party had failed to provide; (iii) make
    a finding of willful disobedience of the order; and (iv) consider
    proportionality. Here, the motion judge did just that. In detailed reasons he
    itemized the disclosure already made and what remained outstanding. He found
    that the breach was willful. He considered proportionality in the light of
    disclosure already made, saying that he was less moved by the quantity than by
    the quality of the disclosure. The appellant had not disclosed basic documents
    such as his income tax returns, financial statements, bank account statements,
    credit card statements, and investment account statements.

[10]

This was not a situation of overreaching by the respondent. The breaches
    and failure to disclose occurred in the context of extensive case management. 
    Horkins J., in particular, had carefully itemized the required disclosure. The
    appellant did not comply.

[11]

Although the respondent had also made incomplete disclosure in relation
    to $377,000 removed from her bank account, the motion judge found that this was
    in the context of otherwise full disclosure.

[12]

In
Chiaramonte
, an appeal was allowed where

the motion
    judge had mischaracterized the disclosure by the party whose pleadings were
    struck. Here, however, the motion judges findings were supported on the record
    before him.  In
Purcaru
, this court upheld a trial judges ruling which
    struck out pleadings for breaches and non-disclosure.

[13]

Our second reason is this: after continual admonitions by the courts and
    the legislature that parties to a matrimonial proceeding must produce financial
    documentation, willful non-compliance must be considered egregious and
    exceptional. This court has stated that the most basic obligation in family law
    proceedings is the duty to disclose financial information. The requirement is
    immediate and ongoing:
Roberts v. Roberts
, 2015 ONCA 450, 65 R.F.L.
    (7th) 6, at para. 11.)  In 2015,
Family Law Rule
13 was amended to
    emphasize a partys financial disclosure obligations. A partys non-compliance
    must be considered in the context of this strict financial disclosure
    obligation. Rule 1(8) provides the court with the authority to strike claims. Those
    who choose not to disclose financial information or to ignore court orders will
    be at risk of losing their standing in the proceedings as their claims or
    answers to claims may be struck.

[14]

The motion judge also allowed the respondent to amend her application to
    include a claim for constructive trust in the matrimonial home registered in
    the appellants name. The respondents draft pleading set out the facts of
    contribution supporting this claim. The motion judge had no evidence of
    prejudice to the appellant. There is no basis to interfere with the motion
    judges exercise of discretion in this regard.

[15]

The appeal is dismissed with costs fixed at $13,000, inclusive of
    disbursements and HST.

E.E.
    Gillese J.A.

M.L. Benotto
    J.A.

L.B. Roberts
    J.A.


