“The Family Law Rules contain numerous detailed provisions, (primarily in Rules 13 and 19), setting forth the obligations of those engaged in matrimonial litigation to disclose financial information and other relevant documents. For example:
a) A fundamental requirement for all family law proceedings is that each party must, soon after the proceeding is commenced, make complete and accurate financial disclosure: see, in particular, Rules 13(1) to 13(3) of the Family Law Rules. I note, in particular, that the same obligation of complete and accurate financial disclosure applies to proceedings in which there are claims for support, regardless of whether or not a property claim also is being advanced.
b) Each party thereafter also has a continuing obligation to update his or her financial information, correct any erroneous information, and provide any omitted financial information as soon as it becomes known or is available: see, for example, Rules 13(12), 13(12.1), 13(12.2), 13(15) and 13(16) of the Family Law Rules.
c) More generally, (i.e., including but extending beyond financial disclosure), each party has an obligation to deliver a requested affidavit of documents listing every document, (with very few indicated exceptions), that is relevant to any issue in the case, and in the party’s control or available to the party on request: see Rules 19(1) and 19(2) of the Family Law Rules.
d) The court also has authority to order a party to provide another party with an affidavit listing documents that are relevant to any issue in the case, and in the control of or available on request to a corporation that is controlled directly or indirectly by the party, or by another corporation that the party controls directly or indirectly: see Rule 19(6) of the Family Law Rules.
e) A party who serves such an affidavit of documents thereafter also has an ongoing obligation, upon finding an additional document that should have been listed therein, to immediately serve an updated affidavit listing the correct information: see Rule 19(8) of the Family Law Rules.
f) Opposing parties are entitled to examine any non-privileged document listed in any such affidavit of documents, and to receive copies of any such document at the party’s own expense, at the legal aid rate, (where the existence of the document was listed in a party’s initial disclosure affidavit listing relevant documents), or free of charge, (where a party failed to list the document in its initial disclosure affidavit listing relevant documents).
Not surprisingly, the court is empowered to enforce the above disclosure obligations, if and as necessary, in various ways. In particular:
a) If a party believes that the financial disclosure provided by another party in a financial statement or otherwise does not provide enough information for “a full understanding of the other party’s financial circumstances”, the party may ask the other party to give the necessary additional information, and if the other party does not give it within seven days, the court may order the other party to give the information or to serve and file a new financial statement: see Rule 13(11) of the Family Law Rules.
b) If a party does not follow the rules or an order regarding documentary disclosure, the court may deal with the failure by any of the ways outlined in Rules 1(8) and 1(8.1) of the Family Law Rules, (e.g., by awarding costs, dismissing a claim or striking out an answer, denying further relief and/or contempt proceedings), and/or by making further orders in relation to the offending party; e.g., obliging the offending party to permit the other party’s examination of relevant documents or supply the other party with copies of such documents free of charge: see Rule 19(10) of the Family Law Rules.
Although the court is given a broad discretion when it comes to dealing with rule non-compliance, (e.g., to make “any order that it considers necessary for a just determination of the matter”, including relief from strict rule compliance in appropriate circumstances), (again, see Rules 1(8) and 1(8.1) of the Family Law Rules, as well as Rule 2(3) thereof, which indicates that “dealing with a case justly” includes, inter alia, ensuring that the procedure is fair to all parties, saving time and expense, and dealing with a case in ways that are appropriate to its importance and complexity) the entire tenor of the various rules outlined above underscores the fundamental importance of complete and accurate disclosure in family law litigation.
Not surprisingly, our courts similarly have emphasized the bedrock importance of such disclosure. Judicial observations and general principles in that regard include the following:
a) Our Court of Appeal has described the immediate and ongoing duty to make honest and complete disclosure of financial information as “the most basic obligation in family law”,(see Roberts v. Roberts, 2015 ONCA 450, at paragraph 11)and the rules requiring disclosure and indicating the sanctions for non-compliance as “the centrepiece of the Family Law Rules”: see Sickinger v. Sickinger, 2018 ONCA 526, at paragraph 36.
b) Such disclosure cannot be selective, or a costly game requiring parties to ferret out information: seeShinder v. Shinder, 2017 ONSC 4177 (CanLII), [2017] O.J. No. 3703 (S.C.J.), at paragraph 31, reversed in part on other grounds, 2018 ONCA 717.
c) Complete and accurate financial disclosure is fundamental to ensure that parties can engage in fair and informed discussions to enable them to reach an equitable and enforceable resolution of their family law dispute or, where necessary, to ensure that each party has all relevant and accurate financial information to place before a court so that the court can make an informed, fair and equitable judicial determination on the financial issues: see Boutin v. Boutin, 2022 ONSC 4776, at paragraph 3.
d) Where complete and financial disclosure is not forthcoming or is substantially delayed:
i) The opposing party is seriously prejudiced in his or her ability to advance claims for child support, spousal support and/or equalization;
ii) Such failures routinely lead to lengthy and unnecessarily complex family law proceedings, unreasonable positions, unnecessary motions, high conflict situations and occasional resort to self-help remedies where a party feels unable to wait for court enforced compliance with the Family Law Rules or court orders; and
iii) a financially disadvantaged party may become self-represented, often because a refusal to make complete and accurate financial disclosure is the litigation strategy of the party with superior financial resources: see Roberts v. Roberts, supra, at paragraph 12; Sickinger v. Sickinger, supra, at paragraph 36; and Boutin v. Boutin, supra, at paragraphs 5-6.
e) Such unfortunate realities have led our courts to characterize failure to make complete and accurate financial disclosure as a “cancer” in family law proceedings; a cancer which discourages settlement, promotes settlements which are inadequate, increases the time and expense of litigation, undermines confidence in our legal system, and brings the administration of justice into disrepute: see Cunha v. Cunha(1994), 1994 CanLII 3195 (BC SC), 99 B.C.L.R. (2d) 93 (S.C.), at paragraph 9; Leskun v. Leskun, 2006 SCC 25 (CanLII), [2006] 1 S.C.R. 920, at paragraph 34; Michel v. Graydon (2020), 2020 SCC 24 (CanLII), 45 R.F.L. (8th) 1 (S.C.C.), at paragraph 33; and Boutin v. Boutin, supra, at paragraphs 7-9.
f) Court involvement should not be required to ensure the disclosure of complete and accurate financial information: see Roberts v. Roberts, supra, at paragraph 13; and Sparr v. Downing, 2020 ONCA 793, at paragraph 4: see Roberts v. Roberts, supra, at paragraph 13; and Sparr v. Downing, 2020 ONCA 793, at paragraph 4. When it is, courts should approach such situations in a manner that strongly reaffirms that that rules regarding disclosure must be followed or there will be consequences. In particular, parties should be deterred from engaging in non-disclosure, and courts must ensure that those engaging in such non-disclosure do not benefit from doing so: see Itrade Finance Inc. v. Webworx Inc., 2005 CanLII 24776 (ON SC), [2005] O.J. No. 3492 (S.C.J.), at paragraph 20; and Boutin v. Boutin, supra, at paragraph 10.
g) Even where a party has complied with their minimum financial disclosure obligations set forth in the Family Law Rules, a more detailed and in depth analysis of their financial situation may nonetheless be required in cases where questions arise as to whether the income reported by a part is an accurate reflection of their true income, especially in cases where child support is in issue. In particular, as child support is the right of the child, who typically is not a party in child support proceedings, it is incumbent upon the court to err on the side of more extensive disclosure if this is necessary to ensure that the child receives the full protection of the law and the most fulsome benefit of support from his or her parents. Such an approach is consistent with the Supreme Court of Canada’s emphasis that any incentives for payor parents to be deficient in meeting their appropriate child support obligations should be eliminated: see S.(D.B.) v. G.(S.R.), 2006 SCC 37 (CanLII), [2006] 2 S.C.R. 231, at paragraph 4; and Spettigue v. Varcoe, 2011 ONSC 6004 (CanLII), [2011] O.J. No. 4914 (S.C.J.), at paragraph 19.”