A recent decision by the Ontario Superior Court in Lindstrong v. Paju,^[1] addressed the impermissibility of threatening criminal proceedings against another party involved in litigation, particularly in the light of an existing court order preventing such threats.

Heard in the context of a contempt motion, Justice T.J. Nieckarz was tasked with considering issues including threats from a plaintiff to bring criminal proceedings against the defendant estate trustee and affiant witnesses unless they recanted evidence and paid the plaintiff a designated amount; the relevant approach to be taken in contempt hearings; and the affirmed understanding that parties cannot attempt to “finesse” a court order, and must instead undertake reasonable efforts to adhere to the spirit of an order.

Background

During contentious estate proceedings between siblings, a plaintiff began threatening criminal proceedings against the defendant estate trustee and an affiant witness unless they recanted certain evidence and essentially agreed to concede the litigation by paying the plaintiff a monetary sum.

In response to these threats, the defendant secured a case conference before Justice Nieckarz where the following preventative order was made:

While this proceeding is ongoing, Ms. Lindstrom shall not threaten criminal proceedings against any affiants for the Defendant, or the Defendant, for their participation in this proceeding and particularly (but not limited to) in exchange for any monetary amount or offers to settle.

Unfortunately, despite the order, the plaintiff continued threatening to report the Defendant’s alleged “illegal conduct” to the Canada Revenue Agency unless the plaintiff was paid $241,629.

More specifically, the plaintiff made statements including that:

…if you would like me not to report you to the CRA fraud informant program, which will have very significant implications for you and for the lawyers and accountants who have been complicit in condoning your illegal actions, you must immediately administer the estate legally which includes honoring the legally valid Codicils and ending the illegal withholding of my personal funds.  If you do not want me to seek legal action to receive my personal funds, I am giving you the option to wire transfer me the funds I am legally entitled to, on Tuesday…

…

… If you do not wire transfer me $241,629 on Tuesday June 27th, I will be forced to contact the CRA fraud informant line in order to report your illegal actions.

In response to these statements, the defendant brought the within proceedings to hold the plaintiff in contempt of Justice Nieckarz’s previous order.

In defense, the plaintiff responded in part that she did not technically threaten criminal proceedings, but instead made threats to report the defendant to an investigative division of the CRA:

The Canada Revenue Agency tax fraud division is an investigative division that where appropriate refers cases for possible criminal prosecution. It is not a criminal proceeding.

Law

Considering first the authority provided by Rules 60.05 and 60.11(5) of the Rules of Civil Procedure, Justice Nieckarz set out the court’s jurisdiction to enforce contempt orders where a previous court order has not been complied with, and further enumerated the penalties that are available following a finding of contempt.

Next, the two analyses required of a contempt hearing were set out and applied, being:

1. the plaintiff’s potential liability; and
2. the plaintiff’s potential ^[2]

Liability

In respect of the plaintiff’s potential liability, the court considered the 3 necessary elements that must be proven beyond a reasonable doubt, which are that:

1. The Order alleged to have been breached must state clearly and unequivocally what should and should not be done;
2. The party alleged to have breached the Order must have had actual knowledge of it; and
3. The party allegedly in breach must have intentionally done the act that the order prohibits or intentionally failed to do the act that the Order compels.^[3]

Here, the court had no problem finding that the first two elements of the test had been clearly met but required a further and more extensive deliberation of whether the plaintiff had “intentionally threatened criminal proceedings contrary to the terms of the Order.”

Considering and ultimately refusing the plaintiff’s position that she had not intentionally violated the court order because she did not threaten criminal proceedings, the court clarified the obligation that is imposed upon parties to exercise reasonable diligence when adhering to court orders:

…a party is obliged to exercise diligence to ensure they obey a court order in both letter and spirit.  A person cannot escape a finding of contempt by “finessing” the interpretation of the order or by hiding behind a restrictive and literal interpretation to make a mockery of the order and the administration of justice.^[4]

Consequentially, Justice Nieckarz found that the plaintiff “knew what she was doing, figured she had found a ‘loophole’ around the Order, and continued with the type of threat my order was designed to avoid.”

Penalty

When determining the appropriate penalty for the plaintiff’s contempt, the court decided that while a finding of contempt could be justified herein, the motion should instead be adjourned, and a final last chance order be made because the plaintiff was self-represented.

Conclusion

Considering this decision, potential litigants and counsel alike should avoid making threats that stem from an opposing party “doing nothing other than advancing a position contrary to the opposing party to the litigation.” In addition to potentially warranting restrictive orders and findings of contempt, such threats “detract from the substantive issues in litigation, increase costs, and unnecessarily increase the hostility associated with the litigation.”

Caution should also be afforded by those attempting to evade a court order based on technicalities, as parties are expected to exercise reasonable diligence in ensuring that the spirit of the order is complied with.

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[1] Lindstrom v. Paju, 2023 ONSC 5640 [Lindstrom].

[2] Optometrists of Ontario v. SHS Optical Ltd., 2008 ONCA 685, at paras. 73-74.

[3] Carey v. Laiken, 2015 SCC 17, at paras. 33-35.

[4]Lindstrom, supra note 1; Sure Track Courier Ltd. v. Kaisersingh et al., 2011 ONSC 4810, at paras. 53-54.