Recent case under COVID-19: Financial issues

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Thomas v Wohleber 2020 ONSC 1965: This is the first case to date that addresses the issue of urgency in a financial context. The two parties have been married for 11 years and have two children. No court orders were in place until the wife brought this motion without notice.

Their marriage had been, in the words of the wife, “rocky.” The husband was financially controlling and secretive. He was the primary income earner and, again in the wife’s words, his income allowed the family to live a “materially substantial life.”

In February, the husband drained the couple’s line of credit to the tune of $775,000. When the wife discovered this, she confronted him. His response was that he thought she was having an affair, so he took the money. The husband had been struggling with some mental health issues and, at this point, the wife’s concerns about those led her to take the children and move to her parents’ home about half an hour’s drive from the matrimonial home, where the husband continued to live.

She continued to insist that her husband return the money to the line of credit. He agreed to do so if she would move back into the family home. She agreed, he returned the money to the line of credit on March 3, but, as the wife shortly discovered, removed it again the following day. It also became apparent to the wife that the husband was stalking her and had likely installed spyware on her cell phone. At this point, the wife once again took the children and moved to her parents’ home because she felt unsafe. Since then, she has been facilitating access between the children and their father.

There was an exchange of correspondence between the parties’ lawyers, in which the husband’s lawyer demanded that the wife agree to a shared parenting arrangement and surrender the home to the husband. Since that initial correspondence, the husband has been representing himself.

Justice Kurz’s decision sets out clearly and in detail the requirements under usual circumstances for a matter to be found urgent and then looks at the requirements under the present circumstances.

He notes that the Chief Justice’s Notice to the Profession allows for a finding of urgency where there are “dire issues regarding the parties’ financial circumstances including for example the need for a non-depletion order.”

He finds that four factors are necessary for a case to meet the current interpretation of urgency:

1. The concern must be immediate; that is one that cannot await resolution at a later date;

2. The concern must be immediate in the sense that it significantly affects the health or safety or economic well-being of parties and/or their children;

3. The concern must be a definite and material rather than a speculative one. It must relate to something tangible (a spouse or child’s health, welfare, or dire financial circumstances) rather than theoretical.

4. It must be one that has been clearly particularized in evidence and examples that describes the manner in which the concern reaches the level of urgency.

Justice Kurz than applies these factors to the case at hand and finds, for the reasons listed below, that it is an urgent matter:

  • The husband had demonstrated erratic personal and financial behaviour in recent weeks
  • Correspondence from his lawyer contained the husband’s “implicit admissions that he had unilaterally removed the funds”
  • The husband “has refused or failed to justify his unilateral conduct”
  • “The amount of the debt on the [line of credit] is equivalent to more than eleven times [the wife’s] annual income”
  • The funds removed are liquid and available to the husband to use as he sees fit
  • The wife is jointly and severally responsible for repaying all of the funds removed by the husband, which she would be unable to do
  • Bank records confirm that the funds were removed by the husband
  • There is a significant risk that the husband will dissipate the funds
  • “All of this raises concerns of dire circumstances for [the wife] and the children if the funds are not repaid on the [line of credit] and a non-dissipation order is not made”

The judge ordered that the husband return the funds within 24 hours of being served with a copy of the order and provide proof of repayment within 24 hours of that. He also ordered that the line of credit be frozen. The order further restrains the husband from “transferring, assigning, pledging, disposing of, depleting, dissipating or otherwise dealing with any assets under his control,” with the exception of payments “necessary to preserve and maintain the home and to retain counsel for this proceeding.”