“Financial disclosure in a family law case is – without doubt – one of the most important obligations.
The 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 Rule 13 of the Family Law Rules, O. Reg. 114/99. This Rule also provides that each party has a continuing obligation to update their financial information, correct any erroneous information, and provide any omitted financial information as soon as it becomes known or is available.
Complete and accurate financial disclosure is fundamental to ensure that the 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 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.
Court involvement should not be required to ensure complete and accurate financial information is disclosed. See Sparr v. Downing, 2020 ONCA 793, para. 4.
Where such complete and accurate financial disclosure is not forthcoming or is substantially delayed, the opposing party is seriously prejudiced in its claims such as, where child support is at issue, where spousal support is at issue, and equalization of family property is at issue. This failure to make complete and accurate disclosure leads to lengthy and unnecessarily complex family law proceedings, unreasonable positions, many unnecessary motions, high conflict situations and, sometimes, parties resorting to self-help remedies rather than waiting for the court to enforce compliance with the Rules and/or court orders.
The failure to make complete and accurate financial disclosure often causes the financially disadvantaged party to become self-represented, usually because the refusal to make complete and accurate financial disclosure is the litigation strategy of the party with superior financial resources.
The failure to make complete and accurate financial disclosure has been described as a “cancer” in family law proceedings. See Michel v. Graydon (2020), 2020 SCC 24 (CanLII), 45 R.F.L. (8th) 1 (S.C.C.) at para. 33.
Where a party is permitted to disregard financial disclosure orders, the confidence of the public in the administration of justice is undermined.
It brings the administration of justice into disrepute.
The Courts must address cases where a party deliberately fails or refuses to make complete and accurate financial disclosure, in a manner that strongly reaffirms rules must be followed or there will be consequences – serious consequences. This is necessary to ensure that the offending party and other parties in other proceedings are deterred from engaging or continuing to engage in such conduct and to ensure that the offending party does not benefit from their misconduct. See Itrade Finance Inc. v. Webworx Inc. 2005 CanLII 24776 (ON SC), [2005] O.J. No. 3492 at para. 20 (ON S.C.).”