Virc v. Blair et al., (2014) 319 O.A.C. 359 (CA)

• Judge: Cronk, Pepall and Strathy, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: November 12, 2013
• Jurisdiction: Ontario
• Citations: (2014), 319 O.A.C. 359 (CA);2014 ONCA 392

Virc v. Blair (2014), 319 O.A.C. 359 (CA)

MLB headnote and full text

Temp. Cite: [2014] O.A.C. TBEd. MY.030

Patricia Anne Virc (applicant/responding party/appellant) v. Michael F. Blair and Renegade Capital Corp. (respondents/moving parties/respondent)

(C56500; 2014 ONCA 392)

Indexed As: Virc v. Blair et al.

Ontario Court of Appeal

Cronk, Pepall and Strathy, JJ.A.

May 14, 2014.

Summary:

A wife applied to set aside a separation agreement that she had entered into with her former husband. She argued, inter alia, that the husband had deliberately and materially misrepresented the value of a company and his interest in it, with the result that the wife received an equalization payment that was substantially less than what she was entitled to. The husband moved for summary judgment dismissing the wife's application.

The Ontario Superior Court, in a decision reported at [2012] O.T.C. Uned. 7104, granted the husband's motion. The court concluded that even if the values provided by the husband were false, there was no genuine issue for trial because the wife had been in a position and had information that should have caused her to question the husband's disclosure before she signed the separation agreement. The wife appealed.

The Ontario Court of Appeal allowed the appeal and ordered that the wife's application proceed to trial.

Family Law - Topic 3207

Separation agreements, domestic contracts and marriage contracts - General - Financial disclosure - [See Family Law - Topic 3398 ].

Family Law - Topic 3208

Separation agreements, domestic contracts and marriage contracts - General - Statutory requirements (incl. filing and signed consent) - The parties signed a separation agreement at their home with no witness present - Two days later, the husband took the signed agreement to his office where a co-worker who recognized the wife's signature purported to witness both parties' signatures - The wife applied to set aside the separation agreement on the basis that it did not comply with the witness requirement under s. 55(1) of the Family Law Act - A motion judge granted the husband's motion for summary judgment dismissing the wife's application - The wife appealed - The Ontario Court of Appeal stated that "...the appellant admitted signing the agreement, accepted the benefits of the agreement and waited for close to two years to raise the issue of non-compliance with s. 55(1). Moreover, the co-worker witness recognized and was able to identify the appellant's signature. In these circumstances, it was not open to the appellant to successfully assert non-compliance with s. 55(1) of the FLA and the motion judge was correct in determining that this was not a genuine issue requiring a trial." - See paragraphs 77 to 81.

Family Law - Topic 3273

Separation agreements, domestic contracts and marriage contracts - Enforcement - Summary judgment - [See Family Law - Topic 3208 and both Practice - Topic 5708 ].

Family Law - Topic 3382

Separation agreements, domestic contracts and marriage contracts - Grounds for setting aside - Material nondisclosure and misrepresentation - [See Family Law - Topic 3398 and first Practice - Topic 5708 ].

Family Law - Topic 3398

Separation agreements, domestic contracts and marriage contracts - Grounds for setting aside - Evidence and proof (incl. onus of proof) - A wife applied to set aside a separation agreement that she had entered into with her former husband - She argued that the husband had deliberately and materially misrepresented the value of a company and his interest in it, with the result that the wife received an equalization payment that was substantially less than what she was entitled to - The husband moved for summary judgment dismissing the wife's application - The motion judge granted the motion - She assumed, for the purposes of the motion, that the husband had made deliberate and material misrepresentations, but found that there was no genuine issue for trial because the wife had been in a position and had information that should have caused her to question the husband's disclosure before she signed the separation agreement - The Ontario Court of Appeal allowed the wife's appeal - Once the motion judge assumed that there had been misrepresentations, she erred in shifting the onus to the wife to inquire as to the veracity of the husband's disclosure - In the face of a deliberate and material misrepresentation, the burden was on the party disclosing to establish actual knowledge of the falsehood by the recipient - See paragraphs 54 to 63.

Practice - Topic 5702

Judgments and orders - Summary judgments - Jurisdiction or when available or when appropriate - [See Family Law - Topic 3208 ].

Practice - Topic 5708

Judgments and orders - Summary judgments - Bar to application - Existence of issue to be tried - A wife applied to set aside a separation agreement that she had entered into with her former husband - She argued that the husband had deliberately and materially misrepresented the value of a company and his interest in it, with the result that the wife received an equalization payment that was substantially less than what she was entitled to - The husband moved for summary judgment dismissing the wife's application - The motion judge granted the motion - She assumed, for the purposes of the motion, that the husband had made deliberate and material misrepresentations, but found that there was no genuine issue for trial because the wife had been in a position and had information that should have caused her to question the husband's disclosure before she signed the separation agreement - The Ontario Court of Appeal allowed the wife's appeal - There were genuine issues requiring a trial, including the extent of the defective disclosure, the degree to which it was deliberately generated, and whether the wife had actual knowledge of the misrepresentations - It was inappropriate to make a determination about the validity of the agreement in the absence of these findings - A detailed analysis of the intentions underlying the parties' conduct was required, and such an analysis was not possible on a rule 16 summary judgment motion - See paragraphs 64 to 75.

Practice - Topic 5708

Judgments and orders - Summary judgments - Bar to application - Existence of issue to be tried - A wife applied to set aside a separation agreement that she had entered into with her former husband - She argued that (1) the husband had made misrepresentations that affected the property settlement; (2) the parties' inequality of bargaining power resulted in undue influence; (3) the husband's eagerness to resolve matters created duress; (4) the terms regarding child support and the matrimonial home were unconscionable; and (5) the terms of the agreement should be altered to provide for spousal support - The husband moved for summary judgment dismissing the wife's application - The motion judge granted the motion, finding that there was no genuine issue requiring a trial - The Ontario Court of Appeal allowed the wife's appeal - The property settlement and spousal support provisions in the agreement were negotiated in tandem - Given the potential extent of the husband's misrepresentations, a court had to review both aspects of the agreement together - Under these circumstances, assessing whether the agreement complied with the objectives of the Divorce Act respecting spousal support was a genuine issue requiring a trial - Given the unresolved issues, the allegations of undue influence, duress and unconscionability also should have been determined by a trial judge on a full factual record - See paragraph 76.

Cases Noticed:

LeVan v. LeVan (2008), 239 O.A.C. 1; 90 O.R.(3d) 1; 2008 ONCA 388, refd to. [para. 31].

Dochuk v. Dochuk (1999), 89 O.T.C. 41; 44 R.F.L.(4th) 97 (Gen. Div.), refd to. [para. 31].

N.R. v. B.B. et al., [2009] 1 S.C.R. 295; 385 N.R. 85; 266 B.C.A.C. 1; 449 W.A.C. 1; 2009 SCC 10, refd to. [para. 32].

Armstrong v. Armstrong (2006), 215 O.A.C. 193; 32 R.F.L.(6th) 244 (C.A.), dist. [para. 35].

Butty v. Butty (2009), 256 O.A.C. 258; 99 O.R.(3d) 228, dist. [para. 35].

Farquar v. Farquar (1983), 43 O.R.(2d) 423 (C.A.), dist. [para. 35].

Miglin v. Miglin, [2003] 1 S.C.R. 303; 302 N.R. 201; 171 O.A.C. 201; 2003 SCC 24, refd to. [para. 42].

Quinn v. Epstein Cole LLP et al., [2008] O.A.C. Uned. 455; 92 O.R.(3d) 1; 2008 ONCA 662, dist. [para. 63].

Waters v. Conrod (2007), 240 B.C.A.C. 208; 398 W.A.C. 208; 66 B.C.L.R.(4th) 181; 2007 BCCA 230, refd to. [para. 80].

Statutes Noticed:

Family Law Act, R.S.O. 1990, c. F-3, sect. 55(1) [para. 77].

Authors and Works Noticed:

Cheshire & Fifoot's Law of Contract (10th Ed. 1981), p. 244 [paras. 35, 56 et seq.].

Swan, A., and Adamski, J., Canadian Contract Law (3rd Ed. 2012), para. 5.50 [para. 78].

Counsel:

Stephen M. Grant and Bryan R.G. Smith, for the appellant;

Valerie L. Brown, for the respondent.

This appeal was heard on November 12, 2013, before Cronk, Pepall and Strathy, JJ.A., of the Ontario Court of Appeal. Pepall, J.A., delivered the following judgment for the court on May 14, 2014.