J. F.L.D. A.D. 1998 No. 391 J.C. R. IN THE QUEEN’S BENCH JUDICIAL CENTRE OF REGINA BETWEEN: YVETTE CYNTHIA ANDERSON and CHRISTOPHER ANDERSON RESPONDENT E. F. Anthony Merchant, Q.C. for the petitioner Linda A. Christensen for the respondent JUDGMENT PRITCHARD J. May 21, 1999 [1] The petitioner obtained an ex parte order under s. 8(1) of The Family Maintenance Act, 1997, S.S. 1997, c. F-6.2 (the “Act”) which:(a) restrains the Attorney General of Canada from releasing or paying any monies to the respondent or his solicitors, MacPherson, Leslie & Tyerman (“MLT”), in relation to the respondent’s claim in Queen’s Bench Action No. Q.B.G. No. 2270/97, J.C. Regina (the “Action”), pending the petitioner’s application or further court order;(b) restrains MLT from releasing or paying to the respondent any monies that they have received or may receive in relation to the Action;(c) restrains MLT from releasing or paying to any Chris Anderson or Christopher Anderson, any monies that they have received or may receive in relation to a claim by a Chris Anderson or Christopher Anderson against the Attorney General of Canada; and(d) restrains the respondent from disposing of any of the monies that he has received or may receive in relation to the Action or any claim against the Attorney General of Canada pending the petitioner’s application or further court order. [2] By notice of motion, the petitioner has applied to have the ex parte order set aside insofar as it applies to the Attorney General of Canada but seeks to continue the restraining order against the respondent and his solicitors, MLT. The respondent has applied to have the interim order set aside. Both parties agree that the provision in the ex parte order referred to in (c) above is not required and should terminate. It is so ordered. Likewise, the ex parte order is lifted as against the Attorney General of Canada. [3] As to the balance of the order, the respondent argues that restraining order granted under s. of the Act is preservation of property order and should not be granted, whether ex parte or otherwise, because the petitioner has not met the tests that governs the granting of such orders. He submits that the criteria for the granting of preservation order are identical to those that must be considered in an application for an interlocutory injunction. He therefore argues that the court must consider: the strength of the plaintiff’s case; whether the plaintiff will suffer irreparable harm if the injunction is not granted; and whether the balance of convenience (i.e. the risk of injury to the plaintiff if the injunction is not granted, versus the probability of harm to the defendant if it is) favours the granting of the injunction. [4] The Court is not satisfied that the jurisprudence with respect to injunctive remedies based on inherent or equitable jurisdiction of the court applies to an application under s. of the Act. If the criteria required to grant restraining order pursuant to the Act were meant to be the same as those required to grant an injunction pursuant to s. 45 of The Queen’s Bench Act, R.S.S. 1978, c. Q-1, there would have been no need for the unique provision in s. of the Act or its immediate predecessor. In view of s. 10 of The Interpretation Act, 1995, S.S. 1995, c. 11.2, the Court interprets s. as remedial provision which is intended to fill gap in the existing legislative scheme. As s. was enacted to provide solution where none had previously existed, it is to the terms of the statute itself that the Court must primarily look for determination of the appropriate considerations upon which it may exercise its powers thereunder. Section provides: 8(1) On application by claimant, the Court of Queen’s Bench may make an interim or final order restraining the disposition or wasting of assets that would impair or defeat claim pursuant to this Act. (2) An application pursuant to this section may be made ex parte at the discretion of the court. [5] Section of the Act grants the court authority to restrain the “disposition or wasting of assets”. This authority is limited to circumstances where the disposition or wasting “would impair or defeat claim pursuant to this Act”. Under the Act, the Court is allowed to exercise its discretion in deciding whether an application for restraining order should be granted. This section also allows the claimant to make an ex parte application for restraining order. Section creates new but very limited form of injunctive relief with this extraordinary remedy being available for the sole purpose of preventing the impairment or defeat of the Act. [6] The respondent also argues that before the Court can exercise its discretion to grant restraining order it should have some evidence that the party to be restrained could or would impair or defeat claim under the Act. The respondent submits that in this case, no such evidence is available. [7] The evidence establishes that the respondent has never had assets of significant value and the Court agrees that it has insufficient evidence upon which it could reasonably conclude that if the respondent acquired substantial funds that he would imprudently or improperly dispose of such funds or otherwise fail to use them to support his family. The respondent submits that the existing ex parte interim order wrongly assumes that he will dissipate his assets; that the entire underpinning of the order is based on an uninformed and biased assumption that person who has received social assistance for the majority of his adult life and then receives significant lump sum of money will somehow squander his money without regard to his moral and legal support obligations. He argues that such an assumption is highly prejudicial and results in an unfair treatment of those who have previously not had the ability to adequately support their families. [8] This argument is appealing, but to embrace it, the Court must find that before s. restraining order can be granted, the Act requires it to have some evidence of respondent’s predilection or intention to waste assets. Here, the statute contains no such requirement and if the legislature had intended it as precondition to the granting of this extraordinary remedy, it could easily have done so by express language as it is in other statutes. In this regard, the Court has compared the wording of s. of the Act with s. 55 of The Enforcement of Maintenance Orders Act, 1997, S.S. 1997, c. E-9.21, and s. 29 of The Matrimonial Property Act, 1997, S.S. 1997, c. M-6.11 which also permit the Court to grant ex parte orders restraining respondent’s ability to deal with his or her assets. Section 55 of The Enforcement of Maintenance Orders Act, 1997 very specifically circumscribes when restraining order may be granted. 55(1) On an ex parte application by the claimant and where the court is satisfied that the respondent is hindering or defeating or is attempting to hinder or defeat the enforcement of maintenance order by dissipation, gift or transfer of assets, the court may make an order: (a) restraining any dealing with, or gift or transfer, of, the property; or (b) appointing receiver in accordance with section 49. (2) On an ex parte application by the claimant and where the court is satisfied that the respondent is attempting to hinder or defeat the enforcement of arrears under maintenance order by leaving Saskatchewan, the court may issue warrant for the arrest of the respondent for the purpose of bringing the respondent before the court to be examined with respect to his or her ability to meet his or her obligations pursuant to the maintenance order. [Emphasis added] [9] Section 29 of The Matrimonial Property Act, 1997, also carefully circumscribes the authority of the Court to restrain the conduct of property holding spouse. The section states: 29(1) The court has the powers conferred by subsection (2) where the court is satisfied that spouse: (a) is about to commit an act amounting to dissipation, and that action may defeat claim of the other spouse pursuant to this Act; (b) is about to abscond with any matrimonial property, and that action may defeat claim of the other spouse pursuant to this Act; (c) intends to transfer matrimonial property to person for less than adequate consideration, and that action may defeat claim of the other spouse pursuant to this Act; or (d) intends to make substantial gift of matrimonial property, and that action may defeat claim of the other spouse pursuant to this Act. (2) For the purposes of subsection (1), the court may do any of the following: (a) make an order restraining the making of the transfer or gift or the absconding with the property; (b) make receiving order or any other order that it thinks fit for the purpose of restraining the dissipation or further dissipation of the property or for the possession or delivering up, safekeeping and preservation of the property. (3) An application for an order pursuant to subsection (2) may be made as an application in proceedings commenced pursuant to this Act, by notice of motion or in any other manner that may be prescribed in the rules of court. (4) An application for an order pursuant to subsection (2) may be made ex parte and, where an application is made ex parte, the court may: (a) dispense with service of the notice of the application; or (b) direct that the notice of the application be served at any time and in any manner that the court thinks fit. (5) Every person who knowingly and wilfully refuses or neglects to comply with an order made pursuant to subsection (2) is, in addition to any other liability that person may incur, guilty of an offence and liable on summary conviction to fine of not more than $1,000.00. [Emphasis added] [10] In contrast, the Act does not require the Court to be satisfied that the respondent is hindering or defeating, will hinder or defeat, or will attempt to hinder or defeat claim. Nor does the Act limit the circumstances in which restraining order may be granted as does The Matrimonial Property Act, 1997. The only requirement is that the disposition or wasting of the asset would impair or defeat claim under the Act. [11] When a respondent has only one asset that could reasonably become a source of satisfying a claim under the Act, not only his or her dependants, but society as a whole has an interest in ensuring that the asset will be used first and foremost for such purpose. If the asset is not available for claim under the Act, then it is society who will inevitably assume respondent’s responsibility for his or her dependants. Perhaps this is why the court’s primary focus under s. is directed to determining whether, in the circumstances before it, disposition or wasting of the specified asset would impair or defeat claim under the Act. Where there is any risk that claim may be impaired or defeated, whether or not an intention to do so has been evidenced, the court has the discretion to issue restraining order. In framing s. of the Act as it has, the legislature has apparently determined that the protection of dependants outweighs an individual’s rights in property. Unfortunately, this may result in restraining orders being more frequently available where the parties have limited resources, but these are also the circumstances where it is most critical to ensure means of protecting source of income for dependant children and spouses. [12] In this case, the Court is satisfied that the respondent’s personal claim for damages in the Action is the only asset that he has at this time that might give him an ability to satisfy the claim under the Act that has been made by the petitioner on behalf of herself and the children, Joel Kelly Morgan Raphael, born August 27, 1990 and Tosha Lauren Anderson, born February 5, 1992. Although there is no persuasive evidence that upon success in his Action the respondent would not voluntarily ensure that any claim under the Act is satisfied, the Court accepts that if the entire proceeds from the Action were disposed of, the petitioner’s claim under the Act would be impaired or defeated. However, if the Action results in proceeds of between $100,000.00 to $143,500.00, as hoped for by the respondent, it is unlikely that the full amount would be required to satisfy any claim under the Act. No evidence was presented regarding the potential value of the petitioner’s claim. Without prejudging the merits, if any, of the petitioner’s claim for herself and the children, the court is prepared to arbitrarily determine that the sum of $40,000.00 will likely be sufficient security for the claim under the Act. Accordingly, for the time being, the restraining order will attach only to the first $40,000.00 of funds received by the respondent if and when any amount, whether by judgment or settlement, becomes payable to him pursuant to the Action. As indicated, this $40,000.00 figure is purely arbitrary and either party may at any time apply to raise or lower it based on evidence available at the time of such application. [13] The Court is not satisfied that the restraining order should extend to any one other than the respondent. Section only authorizes restraining orders against those against whom claim under the Act may be made since it is only they who may dispose of or waste assets from which claims may be satisfied and thereby impair or defeat claim. The ex parte restraining order against MLT shall therefore be lifted. [14] Costs are reserved to be dealt with on the hearing of the application for maintenance under the Act which may be brought back before any presiding judge upon ten days’ notice.
The petitioner obtained an ex parte order under the Family Maintenance Act which restrains the Attorney General from paying any money owing under an action in Queen's Bench to the respondent and his solicitor and restraining the respondent from disposing of any monies received in the action. The respondent applies to have the order set aside. The respondent argues that a restraining order under the Act is a preservation of property order and should not be granted because the petitioner has not met the tests that govern the granting of such orders. He submits that the criteria for the granting of a preservation order is the same as for a interlocutory injunction. The respondent argues that before the Court can exercises its discretion and grant an order, is should have some evidence that the party being restrained would defeat a claim under the Act. HELD: The Court is satisfied that the respondent's personal claim for damages is the only asset the he has to satisfy the claim under the Act. Without prejudicing the applicant's claim, the Court will arbitrarily determine that the sum of $40,000 will likely be sufficient security. For the time being, the order will attach to the first $40,000 of funds received by the respondent, if and when any amount becomes payable to him. The parties may apply to vary this amount in future. Costs are reserved to be dealt with on the hearing of the application for maintenance. The Court is not satisfied that the jurisprudence with respect to injunctive remedies based on inherent jurisdiction of the court applies to an application under s.8 of the Act. If the criteria for granting a restraining order under the Act were meant to be the same, there would be no need for the unique provision of the Act. As s.8 was enacted to provide a solution where none had existed, the Court must primarily look to the statute itself for a determination of the appropriate considerations. Section 8 of the Act grants the Court the authority to restrain the disposition of assets and creates a new, but limited, form of injunctive relief with this remedy being available solely to prevent the impairment or defeat of the Act. The statute does not require the Court to be satisfied that the respondent is hindering or defeating a claim. When a respondent has only one asset that could reasonably satisfy a claim, his dependents and society as a whole have an interest in ensuring that the asset will be used for such purpose.