Subrule 13(6) of Ontario’s Family Law Rules states that any party serving a financial statement must make “full and frank disclosure of the party’s financial situation.” Financial statements must also be fully complete and submitted with supporting documentation.

Despite the fact that full and accurate disclosure from both sides is an essential component to the swift resolution of virtually any family law matter, the rule can sometimes be loosely adhered to or disregarded in its entirety by litigants.

As the following case illustrates, a failure to make open and honest disclosure can lead to extreme delays, inflated legal costs and a very undesirable outcome for the party failing to disclose.

In Oelbaum v. Oelbaum, 2010 ONSC 4874 (CanLII), a husband and wife separated after 22 years of marriage. The litigation began in October of 1996. Throughout the 14 years of litigation, the husband refused to provide meaningful financial disclosure.

Although having been warned that not making disclosure would lead to his Answer being struck, the husband continued to disregard the rules. His Answer was eventually stuck, and the trial proceeded on an uncontested basis.

One month after the issuing of the trial judgment in favour of the wife (which included an order of $183,158 in costs) the husband filed a financial statement and brought a motion for the reinstatement of his Answer. Unfortunately for Mr. Olebaum, Murray J. found the new financial statement to be both incomplete and inadequate. In the end, the Court dismissed the motion, noting that the Respondent’s latest attempt at disclosure was “too little and too late.”

After a thorough review of the history of the husband’s failure to disclose his finances, Murray J. stated the following:

[21] … It is fair to conclude that Mr. Oelbaum elected to treat court orders and the applicant with complete disdain behaving as if the Court and the applicant had no business knowing the details of his financial situation. He refused to provide accurate financial information that was of fundamental importance in fairly determining issues of property allocation and child and spousal support in accordance with the applicable legal principles.

In his endorsement, Murray J. highlighted some of the broader policy considerations weighing against a decision in favour of the Respondent. On the importance of full disclosure to the administration of justice, his Honour stated:

[38] What would be the effect of any order the motions judge might make on the overall integrity of the administration of justice? Without meaning to trivialize the importance of candour and honesty in uncontested proceedings, I conclude that the overall integrity of the administration of justice would be tainted by granting the respondent’s motion in this case. The respondent has bullied this applicant for years. The respondent’s refusal to provide accurate and complete financial information was intended to be, and was, a barrier to the applicant’s ability to obtain relief.

And later,

[47] … If the respondent were to be successful in this case, it would be an invitation to like-minded spouses in other matrimonial cases to stonewall, not to pay interim child and spousal support, to refuse financial disclosure and to be extremely contentious in litigation. It would encourage “gaming the process.” Such a result would be antithetical to the notion of fair and efficient dispute resolution in matrimonial cases.

The respondent was finally ordered to make payments to his wife for support arrears, costs and ongoing support totaling well in excess of $1.5 million.

One can’t help but wonder how much time and money could have been saved had the husband simply adhered to subrule 13(6).

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