The obligation to comply with financial disclosure orders in a family law proceeding is a serious one. It may seem obvious that full and frank financial disclosure is the starting point with respect to any discussion or negotiation of issues arising out of separation such as child support, spousal support, and equalization of property. However, not all family law clients are open and honest with their lawyers, making it difficult to comply with such disclosure orders.
This important issue was raised before the Ontario Court of Appeal in Roberts v. Roberts, 2015 CarswellOnt 9247 (Ont. C.A.). In this case, the husband did not comply with three court orders for financial disclosure. The lower court struck his pleadings and allowed the wife to proceed with an undefended trial. The husband appealed, and much to his surprise, the Court of Appeal upheld the lower court’s decision.
Justice Benotto, on behalf of a unanimous Court of Appeal stated:
The most basic obligation in family law is the duty to disclosure financial information. This requirement is immediate and ongoing.
Failure to abide by this fundamental principle impedes the progress of the action, causes delay and generally acts to the disadvantage of the opposite party. It also impacts the administration of justice. Unnecessary judicial time is spent and the final adjudication is stalled.
Financial disclosure is automatic. It should not require court orders – let alone three – to obtain production.
The power to strike out the pleadings is to be used sparingly and only in exceptional cases. This is such a case. The appellant’s conduct in ignoring court orders and failing to follow the basic principles of family law litigation put him in the exceptional category of cases where the judge’s discretion to strike his pleadings was reasonably exercised.
Recently, the Ontario Family Law Rules have been amended to provide for the production of immediate financial disclosure to the opposite party via the requirement to file a Certificate of Financial Disclosure. The Roberts case teaches us that a court will not look favourably upon a party who is not upfront and honest when it comes to financial disclosure. Moreover, it is counsel’s duty to make it clear to their clients that they cannot play hide and seek when it comes to providing relevant financial disclosure. The repercussions of not doing so can be significant and expensive.