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. Hicks v. Ontario Ombudsman

In Hicks v. Ontario Ombudsman (Div Ct, 2020) the Divisional Court briefly reviewed events in a rare case where incarceration resulted from a finding of civil contempt. The case is interesting as it shows how contempt incarceration is truly criminal in nature.

. Boily v Carleton Condominium Corporation 145

In Boily v Carleton Condominium Corporation 145 (Ont CA, 2014) the Court of Appeal stated on the penalties for civil contempt:
[79] The purpose of a penalty for civil contempt is to enforce compliance with a court order and to ensure societal respect for the courts: Vidéotron Ltée v. Industries Microlec Produits Électroniques Inc., 1992 CanLII 29 (SCC), [1992] 2 S.C.R. 1065, at 1075. The remedy for civil contempt is designed not only to enforce the rights of a private party (See: Poje v. Attorney General (B.C.), 1953 CanLII 34 (SCC), [1953] 1 S.C.R. 516 at 517; Frontenac Ventures Corp. v. Ardoch Algonquin First Nation, 2008 ONCA 534, 91 O.R. (3d) 1, at para. 37), but also to enforce the efficacy of the process of the court itself. Justice McLachlin powerfully expressed this broader purpose in United Nurses of Alberta v. Alberta (Attorney General), 1992 CanLII 99 (SCC), [1992] 1 S.C.R. 901 at 931, stating:
[t]he rule of law is directly dependent on the ability of the courts to enforce their process and maintain their dignity and respect. To maintain their process and respect, courts since the 12th century have exercised the power to punish for contempt of court.
....

[90] The following are the factors relevant to a determination of an appropriate sentence for civil contempt:
a) the proportionality of the sentence to the wrongdoing;

b) the presence of mitigating factors;

c) the presence of aggravating factors;

d) deterrence and denunciation;

e) the similarity of sentences in like circumstances; and

f) the reasonableness of a fine or incarceration.
Echostar Communications Corp. v. Rodgers, 2010 ONSC 2164; Sussex Group Ltd. v. Fangeat, [2003] O.J. No. 3348, [2003] O.T.C. 781 at para. 67 (Ont. S.C.); Builders Energy Services Ltd. v. Paddock, 2009 ABCA 153, at para. 13. Megill, at pp. 7-8.

(i) Proportionality

[91] The principle of proportionality requires that the punishment fit the wrongdoing: York (Regional Municipality) v. Schmidt, [2008] O.J. No. 4915 (S.C.), at para. 16. As Jeffrey Miller wrote in his leading textbook The Law of Contempt in Canada (Toronto: Carswell, 1997), at p. 131: “[t]he fundamental principle in all sentencing, including sentencing for contempt, is that the sentence must be commensurate with or ‘fitted to’ the gravity of the offence.”

....

[105] As set out above, deterrence, specific and general, is the most important objective of a contempt penalty. Justice Quinn, in Niagara (Municipality), expressed the purpose of sentencing in contempt proceedings as follows:
The primary purpose of sentencing in contempt proceedings is deterrence: both general and specific. The punishment for contempt should serve as a disincentive to those who might be inclined to breach court orders. Our legal system is wounded when court orders are ignored. The sentence must be one that will repair the wound and denounce the conduct.
See also: Cornwall (Public Inquiry) v. Dunlop (2008), 2008 CanLII 10382 (ON SCDC), 290 D.L.R. (4th) 699 (Ont. S.C.) at para. 48; Tilco Plastics Ltd. v. Skurjat et al. (1966), 1966 CanLII 235 (ON SC), 57 D.L.R. (2d) 596 (Ont. H.C.), affirmed 1966 CanLII 517 (ON CA), [1967] 1 O.R. 609 (C.A.), leave to appeal to S.C.C. refused [1967] 1 O.R. 609.

....

[121] There is no formally mandated process for contempt proceedings. The procedure followed may vary. However, contempt proceedings typically have two stages – the liability hearing and a subsequent hearing to determine penalty: The College of Optometrists of Ontario v. SHS Optical Ltd. (c.o.b. Great Glasses), 2008 ONCA 685, 93 O.R. (3d) 139 at paras. 73-75, per Watt J.A.; Echostar Communications Corp. v. Rodgers, 2010 ONSC 2164, at paras. 34-36. If a contempt finding is made, the matter is adjourned to provide the contemnor an opportunity to purge the contempt and prepare for the sentencing portion of the process. Any action undertaken by a contemnor to purge his or her contempt may serve as a mitigating factor in sentencing: Echostar, at para. 35.

[122] There is good reason to bifurcate contempt hearings. As in criminal prosecutions, in contempt hearings, liability and penalty are discrete issues. In a hearing in which liability and penalty are dealt with together, there is a risk that evidence relevant, material and admissible to liability, will be improperly applied to penalty or vice versa. R. v. B.E.S.T. Plating Shoppe Ltd. and Siapas (1987), 1987 CanLII 4056 (ON CA), 59 O.R. (2d) 145 (C.A.).

[123] In this case, liability and penalty were combined into a single hearing.

[124] I agree with the comments of Watt J.A. in Great Glasses where he said, at para. 74, that: “a proceeding that considers both liability and penalty in the same hearing, may cause unfairness or be infected with legal error to such an extent to require a new hearing.” I also agree with his comments at para. 76, that the extent to which fairness is affected varies from case to case.

[125] In my view, contempt proceedings should be bifurcated for the simple reason that bifurcation avoids risking the need for a new hearing.

[126] I have come to the conclusion that in this case the motion judge’s failure to bifurcate caused or contributed to unfairness as; a) the evidence relevant to liability appears to have been considered in the penalty phase, b) the Appellants had no opportunity to take steps to attempt to purge their contempt, steps that may have been relevant to mitigation. Great Glasses, at para. 102, and c) the parties had no opportunity to prepare for the sentence hearing.

[127] But, as Watt J.A. pointed out in Great Glasses, this error is not necessarily fatal. In this case, I would not interfere with the financial aspect of the remedy on this basis alone. I say this as there is no evidence that the Individual Appellants requested a bifurcated hearing or, at any time during the process, drew the problems associated with a combined hearing to the motion judge’s attention. Moreover, the failure to bifurcate was not advanced as a ground of appeal.

[128] It does, however, affect the degree of deference that this court should pay to the financial penalty the motion judge imposed.

(iii) The Fitness of the Financial Penalty

[129] In civil contempt, it is critical that the penalty respond to the conduct being sanctioned. The relevant conduct is the wilful disregard of the authority of the court. The court must assess the seriousness of the disrespect of the court, not the severity of any resulting harm.

[130] Civil contempt proceedings do not have “and must not appear to have the function of a civil action in tort or for breach of contract”: Royal Bank of Canada v. Yates Holding Inc. (2007), 2007 CanLII 23601 (ON SC), 33 C.B.R. (5th) 268, O.J. No. 2529 (Ont. S.C.), at para. 19. As MacKay J. stated in Merck & Co. v. Apotex Inc., 2001 FCT 589, var’d 2003 FCA 234, 227 D.L.R. (4th) 106, at para. 11, “[a]ny concern of the plaintiffs about injury to them caused by those activities ought to be recoverable in damages or profits claimed. The concern of the Court, in a case of civil contempt such as this is, must be the failure to respect the Court's process.”

[131] I begin with the purpose behind the motion judge’s order that the Individual Appellants pay the costs of restoration.

[132] The reasoning behind the motion judge’s decision to order the Individual Appellants to pay the restoration costs is found in para. 56, set out above. As I read that paragraph, the motion judge imposed this sanction on the basis of his view that it would be unfair to make the condominium owners bear the costs of the Appellants’ contempt of the 2011 Endorsement. The motion judge sought to prevent the unit owners from having to bear the expense associated with the incremental costs of changing the Podium from the amalgam of the Original Design and the Artistic Design, to the Original Design. In effect, the motion judge, in sanctioning the Individual Appellants the way he did, focused on the costs that his restoration order would impose on the unit owners rather than on deterrence. With respect, I am of the view that in doing so, he erred in principle.

[133] Furthermore, the jurisprudence has established factors to be taking into account in deciding upon a fit sentence for civil contempt. One such factor is the particular contemnor’s ability to pay lest the amount either be trivial or unduly punitive: Niagara (Municipality) (Police Services Board) v. Curran (2002), 2002 CanLII 49405 (ON SC), 57 O.R. (3d) 631, at para. 36. Where fines are imposed above an amount necessary to reflect the public interest in the matter, an appellate court will be justified in intervening to reduce the amount: Apotex Fermentation Inc. v. Novopharm Ltd. (1998), 1998 CanLII 4886 (MB CA), 162 D.L.R. (4th) 111 (Man. C.A.), at paras. 319-321.
. Business Development Bank of Canada v. Cavalon Inc.

In Business Development Bank of Canada v. Cavalon Inc. (Ont CA, 2017) the Court of Appeal stated on the penalty phase on contempt:
[74] At the penalty phase of a contempt hearing courts have a wide discretion. Rule 60.11(5) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 provides that the court may make such order as is just, including that the judge may order the contemnor:
(a) be imprisoned for such period and on such terms as are just;

(b) be imprisoned if the person fails to comply with a term of the order;

(c) pay a fine;

(d) do or refrain from doing an act;

(e) pay such costs as are just; and

(f) comply with any other order that the judge considers necessary, and may grant leave to issue a writ of sequestration under rule 60.09 against the person’s property.
....

[82] In civil cases, incarceration is rare. Ordinarily, a finding of contempt, together with a fine or some other order in relation to the litigation, is sufficient to gain compliance and restore the authority of the court. In Chiang, this court observed, at para. 90:
Custodial sentences for civil contempt are rare. Lengthy custodial sentence are even rarer. Canadian courts have tended to punish contempt of court leniently. Ordinarily the mere conviction for contempt together with a modest fine suffices to obtain compliance and to protect the court’s authority. Ordinarily incarceration is a sanction of last resort. [Citation omitted.]
[83] With respect to the observation that Canadian courts have tended to punish contempt of court leniently, Brown J. (as he then was) stated in Mercedes-Benz Financial, at para. 10:
I suspect this observation was based on the commentary contained in the document published in May, 2001 by the Canadian Judicial Council entitled, "Some Guidelines on the Use of Contempt Powers", where, at page 40, the following statements are found:
In Canada punishment for contempt has been quite moderate, reflecting the courts' usual view that a conviction for contempt and a modest fine is usually sufficient to assert the courts' authority, to protect their dignity or to ensure compliance. Often these sentences are imposed after the contemnor has apologized and purged his or her contempt which substantially mitigates any punishment that might otherwise be imposed.
[84] I would add that, in cases of serious breaches of court orders, the Canadian Judicial Council recognized that jail was an appropriate sanction. At page 39 the Council stated:
If the contempt has not been purged and the contempt is a serious one, or if there has been a deliberate disobedience of a court order accompanied by violence or other flagrant misconduct then imprisonment or heavy fines become more likely, but care must be taken to ensure that the disposition of the proceedings does not appear to be bullying or vengeful. [Citation omitted.]

...

Imprisonment should be imposed only in cases of serious deliberate disobedience, violence or wilful interference with the course of justice. Repeated breaches of a restraining order would justify imprisonment, as would a single breach of an order if the breach were a serious one. [Emphasis added.]
[85] More recently, Belobaba J. commented in Ceridian Canada Ltd. v. Azeezodeen, 2014 ONSC 4162, 69 C.P.C. (7th) 29, aff’d 2014 ONCA 656, 69 C.P.C. (7th) 40, at para. 24:
This court has imposed jail sentences ranging from five days to one year in cases of civil contempt. Each of the custodial cases have two things in common: one, the defendant’s breach, like here, was knowing and deliberate; and two, the length of the jail term was a function of the continuing nature of the contempt discounted by the degree of remorse or apology on the part of the defendant…. In my view, where the breach of a court order is knowing and deliberate, continues over several days, and the only response from the defendant is defiance without remorse, a jail sentence is appropriate.
[86] Ordinarily, the period between a finding of contempt and the penalty hearing gives the contemnor an opportunity to purge his or her contempt. At the penalty hearing, if the contemnor has purged his or her contempt, as Belobaba J. noted, this is a significant mitigating factor with respect to the penalty imposed. Where, as here, the impossibility of purging the contempt is a situation of the contemnors’ own making, it is not a mitigating factor: see Echostar Communications Corp. v. Rodgers, 2010 ONSC 2164, 97 C.P.C. (6th) 177, at para. 45.

[87] A wilful flagrant breach of a single court order that shows a callous disregard for the court’s authority, or that causes significant prejudice to the other party may attract a jail sentence: see Mercedes-Benz Financial, at para. 35.

[88] While each case is fact specific, incarceration has been imposed in numerous cases for failure to produce documents or corporate records: see Sussex Group Ltd. v. Sylvester (2002), 2002 CanLII 27188 (ON SC), 62 O.R. (3d) 123 (S.C.), at para. 85 (6 months); Nelson Barbados Group Ltd. v. Cox, 2010 ONSC 569, at para. 35 (3 months and a fine of $7500); Cellupica v. Di Giulio, 2011 ONSC 1715, 105 O.R. (3d) 687, at para. 49 (90 days); Sussex Group Ltd. v. 3933938 Canada Inc., 2003 CanLII 49334 (ON SC), [2003] O.T.C. 683 (S.C.), at para. 15 (2 months); Nowack, at para. 114 (1 month).

[89] As noted above, serious violations of court orders – even if only one order or one instance – can warrant a jail sentence. In determining whether a jail sentence is needed to adequately vindicate the due administration of justice, the context in which the contempt occurs is an important consideration: see Langston v. Landen, 2011 ONCA 242, at para. 1. Because incarceration is ordinarily a penalty of last resort, the court must also consider whether any other penalty short of incarceration would be a sufficient sanction for the gravity of the contempt, taking into consideration the sentencing principles applicable to civil contempt.

(c) Sentencing principles applicable to civil contempt

[90] The factors relevant to a determination of an appropriate sentence for civil contempt were set out by Epstein J.A. in Boily, at para. 90. The factors can be summarized as follows:
(a) Proportionality of the sentence to the wrongdoing – a sentence must be proportionate to the gravity of the offence and the degree of responsibility of the offender: see also Chiang, at para. 86; Mercedes-Benz Financial, at para. 12.

(b) Presence of aggravating and mitigating factors: see also Chiang, at paras. 50-51, 87-89; Sussex Group Ltd. v. Fangeat, [2003] O.T.C. 781 (S.C.), at para. 67.

(c) Deterrence and denunciation – the sentence should denounce unlawful conduct and promote a sense of responsibility in the contemnor, and deter the contemnor and others from defying court orders: see also Chiang, at para. 91; Fangeat, at para. 67.

(d) Similarity of sentence in like circumstances.

(e) Reasonableness of a fine or incarceration: see generally Chiang.
[91] Epstein J.A. concluded that specific and general deterrence are the most important sentencing objectives in civil contempt cases. Other courts have also noted the principles of deterrence to be the primary sentencing principle in cases of civil contempt. The British Columbia Court of Appeal endorsed a similar view in Majormaki Holdings Ltd. v. Wong, 2009 BCCA 349, 97 B.C.L.R. (4th) 64, at para. 28.


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