Ontario Court Appoints Receiver After Husband Defies Financial Disclosure Orders

A person looking at financial records on a tablet, surrounded by financial spreadsheets and a calculator, representing financial disclosure in divorce proceedings

When separating or divorcing, one of the most important tasks of each party is to provide full and frank disclosure of their finances. The financial positions of the parties will be used to determine the immediate and long-term financial arrangements between the parties, including spousal and child support, the treatment of the matrimonial home, and the equalization of assets. Under Rule 13 of Ontario’s Family Law Rules, any party bringing an application for support, property division, or exclusive possession of the matrimonial home must include a financial statement with their application. In turn, the responding party must include a financial statement with their response to the claim.

When parties fail to provide disclosure as required or deliberately provide inaccurate or incomplete information to manipulate the outcome of family litigation, they risk having a domestic order set aside entirely.

In a recent Ontario case involving a high-asset couple who divorced after nearly 50 years of marriage, the court became frustrated with the husband’s deliberate and repeated efforts to avoid his disclosure obligations. In addition to charging him with contempt, the court took the relatively unusual step of appointing a Receiver to ensure that a complete record of his financial assets would be compiled and provided to the court.

Husband Claims Inability to Pay Support After Records Show His Net Worth Exceeds $77 Million

In Boutin v. Boutin, the husband (“VB”) and wife (“MB”) had been married for 47 years and had two children, both of whom were independent adults at the date of separation. VB had accumulated a great deal of wealth as a land developer and builder. VB was the owner of six different companies and held significant interests in at least three more, in addition to owning multiple properties.

The proceedings in question were concerned primarily with MB’s application for spousal support, the equalization of family property, as well as the sale of certain family property.

VB claimed he was not in a financial position to pay spousal support and lacked “realizable equity” in his assets. The Court noted that a Net Worth Statement for VB, prepared just before the separation, showed VB’s net worth as $77 million, with almost $50 million more in assets held by the various companies he owned.

VB had failed to comply with the initial requirement to provide financial disclosure, and so MB applied for an order that he do so, which was granted. Over an 18-month period, the court made four separate orders that VB produce a complete record of his financial holdings, none of which received a satisfactory response. As a result of his refusal to comply, the Court found VB in contempt.

Determining the Appropriate Remedy for Contempt in a Family Proceeding

Under Rule 31 of the Family Law Rules, judges are granted broad discretion to order an appropriate remedy for contempt, including:

  • Imprisonment
  • Fines
  • Payments to other parties to the proceedings
  • Payment of additional costs of the proceedings
  • Anything else the court decides is appropriate

The Court in this case found that VB’s delay tactics and refusal to provide complete financial disclosure were motivated by a desire “to hide and defeat the claims of [MB] of her fair share of family assets and her spousal support claim”. The Court was blunt in its assessment that there were no mitigating factors, and that VB had displayed no remorse for his actions. Further, VB was not unsophisticated; he was an experienced and successful businessman with significant assets to his name. As a result, the Court felt that it would be appropriate to order both serious fines and imprisonment, despite VB’s advanced age of 78.

Wife’s request to Appoint a Receiver

In the application before the Court, MB had requested that VB be ordered to pay her $50,000, and that a Receiver be appointed pursuant to s. 31 of the Family Law Rules. Since MB did not request serious fines or imprisonment, and another effective remedy was available in the form of appointing an Investigative Receiver, the Court granted MB’s request.

In her application, MB had requested that the Receiver’s mandate would be to assist in MB’s ability to realize the various outstanding orders in place against VB. The Court noted that this mandate was inconsistent with a Receiver’s duty to act fairly and impartially with respect to all parties, as an officer of the court.

Court Mandate for Investigative Receiver

The mandate of the Receiver was set as follows:

  • Investigate and report on the true financial situation of VB;
  • Investigate and report on the assets of all of VB’s various companies, and all financial dealings by VB which related to the various companies; and
  • Investigate and report on all non-arm’s length financial transactions between VB and/or VB’s various companies.

In order to fulfill this mandate, the Court chose to imbue the Investigative Receiver with all of the powers of VB in his capacity as an “owner, shareholder, director, officer, tax payer, debtor, and creditor, to seek, request, and obtain possession of all relevant financial documentation and information relating to the financial issues in this case for the purpose of preparing a report to this court regarding [VB]’s assets, properties, financial transactions, and income…”

VB was also ordered to pay the full amount of the costs associated with the appointment and work of the Investigative Receiver.

Contact Bortolussi Family Law in Vaughan for Experienced Representation in High-Asset Family Litigation

The trusted divorce lawyers at Bortolussi Family Law use their extensive advocacy experience in court to help secure favourable results for each client. Our team stays focused on the client’s end goal, even in the face of aggressive tactics in high-conflict litigation. Our clients can be confident in our ability to advance their position while aiming to keep conflict to a minimum to promote a functional family dynamic post-divorce. We have significant experience representing clients in high-asset divorces containing complex financial situations, including the detangling of various business interests. Please contact us online or by phone at 416-987-3300 to speak with a member of our team and learn about the options available to you.

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