• by Christina Hinds
Originally published in the OFLM 2023-10 edition
Overview
This article will set out the factors which are to be considered when determining if two proceedings should be consolidated, with a specific focus on consolidation of family proceedings and civil proceedings. The recent decision of the Superior Court of Justice decision, Alsous v. Shahin (2023 ONSC 3995), addressed this very issue.
Introduction
In the fallout of a separation, disputes may arise between a spouse and another individual, such as a family member, friend, or business partner. In appropriate circumstances, a family proceeding may be consolidated with a civil proceeding.
In Alsous v. Shahin, the wife was also the plaintiff in the civil proceeding. The wife had brought a civil claim against her husband’s sister and brother-in-law. The husband and the defendants in the civil proceeding brought a motion to consolidate the two proceedings.
Justice Broad ultimately determined that two proceedings should not be consolidated. His Honour held that Rule 6 of the Rules of Civil Procedure was not satisfied and further, the “balance of convenience” factors set out in Canadian National Railway v. Holmes (2011 ONSC 4837) and Malkov v. Stovichek-Malkov (2015 ONSC 4836) did not support an order that the proceedings be consolidated.
Facts
In Alsous, the family proceeding included claims for divorce, spousal support, child support, decision-making responsibility, parenting time, and the equalization of net family properties.
The civil proceeding concerned the ownership of a property. The wife pleaded unjust enrichment and sought a declaration that she was a beneficial owner of the property (title to which was registered in the defendants’ names) by way of a resulting or constructive trust.
The wife alleged that she paid funds to the defendants to be applied toward the purchase price, closing costs, renovations, and to help the defendants pay off their debts in order to facilitate financing of the property. In contrast, the defendants alleged that the father’s estate was the beneficial owner of the property notwithstanding that title was registered in their names and that when the father died intestate, the property became beneficially owned by the defendants and their siblings.
The defendants alleged that the father had previously acquired a property and placed the sister on title. Upon the sale of that property, the proceeds were paid to the sister with a view to the sister using those proceeds to acquire another property on behalf of the father. They alleged that the funds advanced to the defendants were the sale proceeds from the previous property and that the wife did not have any legal, beneficial, or equitable interest in those funds.
The Test
In determining if two proceedings should be consolidated, the first stage requires that the criteria in Rule 6 of the Rules of Civil Procedure be met. The second stage involves a determination as to whether the “balance of convenience” factors support a consolidation order. (at para. 21)
1. Rule 6 of the Rules of Civil Procedure
While Rule 12(5) of the Family Law Rules provides that the court may combine two or more cases if it would be more convenient to hear them together, Justice Broad explained that in relation to the consolidation of a family and civil proceeding, jurisprudence has considered Rule 6 of the Rules of Civil Procedure as is it is “more particularized and instructive”. (at paras. 17 and 18)
Rule 6.01 of the Rules of Civil Procedure provides that, where two or more proceedings are pending in the court, and it appears to the court that:
(a) they have a question of law or fact in common;
(b) the relief claimed in them arises out of the same transaction or occurrence or series of transactions or occurrences; or
(c) for any other reason an order ought to be made under the rule
the court may order that the proceedings be consolidated or heard at the same time or one immediately after the other.
The focus at this stage is “whether the proposed common issue has sufficient importance in relation to the other facts or issues such that it would be desirable that the matters be consolidated, heard at the same time, or after each other”. (at para. 20)
Justice Broad determined that there was no issue of law in common between the two proceedings and therefore the criteria of Rule 6 were not satisfied. Justice Broad explained that the legal issue in the family proceeding was whether the subject property formed part of the wife’s net family property and specifically, whether the wife had a beneficial interest in the property on the date of separation. On the other hand, the issue in the civil proceeding was the more discrete issue of whether the wife had a beneficial interest in the property by way of a resulting or constructive trust. (at para. 24)
Justice Broad acknowledged that the two proceedings may have an issue of fact in common (that being, whether the funds advanced by the wife resulted in beneficial ownership) – however, a common issue of fact is not sufficient to satisfy the first stage of the test. (at paras. 25 and 26)
2. The Balance of Convenience Factors
Justice Broad also considered the factors set out in Malkov v. Stovichek-Malkov (2015 ONSC 4836) which were derived from a longer list of factors set out in Canadian National Railway v. Holmes (2011 ONSC 4837). Those factors, and Justice Broad’s application of the factors, are set out below.
a. The extent to which the issues in each action are interwoven
Justice Broad held that the issues in the two proceedings were not interwoven – the finding in the civil proceeding depended upon the wife’s dealings with the father which was not relevant to the family proceeding. (at para. 30)
b. Whether there is a risk of inconsistent findings or judgments if the actions are not joined
There was no risk of inconsistent findings. If the civil proceeding is tried first, Justice Broad stated that it would be determinative of whether such interest forms part of the wife’s net family property in the family proceeding. (at para. 31)
c. Whether the issues in one action are relatively straightforward compared to the complexity of the other action
Justice Broad found that the issues in the civil proceeding were relatively straightforward compared to the family proceeding, which involved parenting and support issues, and other assets relevant to the equalization of the parties’ net family properties. (at para. 32)
d. Whether a decision in one action, if kept separate and tried first, would likely put an end to the other actions or significantly narrow the issues for the actions or significantly increase the likelihood of settlement
Justice Broad stated that a decision in the civil proceeding, if kept separate and tried first, would significantly narrow the issues in the family proceeding or increase the likelihood of settlement. (at para. 33)
e. The litigation status of each action
The civil proceeding was ready for trial. The family proceeding was not. (at para. 34)
f. Whether any of the parties will save costs, or alternatively have their costs increased, if the actions are tried together
Justice Broad noted that the estimated trial time for the civil proceeding was 3-5 days. There was nothing to suggest that trying the civil proceeding with the family proceeding would result in any significant cost savings or trial time. (at para. 35)
Timing of the Motion
In addition to the factors set out above, Justice Broad also considered the timing of the motion for consolidation. In Flitney v. Howard (1958 CanLII 118) the Ontario Court of Appeal held that an order for consolidation “on the very eve of trial” does not accomplish the purposes of saving expense and avoiding multiplicity of pleadings and proceedings.
Conclusion
If Rule 6 of the Rules of Civil Procedure is satisfied and the “balance of convenience” factors favours consolidation, a family proceeding may be consolidated with a civil proceeding.
Consolidation of proceedings saves time, expense, and avoids the multiplicity of pleadings and proceedings.
Prior to bringing a motion for consolidation, it is important to review Rule 6 of the Rules of Civil Procedure and the factors set out in Canadian National Railway v. Holmes and Malkov v. Stovichek-Malkov.
Alsous v. Shahin also reminds us that:
- A motion for consolidation of two proceedings should be brought early on in both proceedings;
- A common issue of fact is not sufficient to satisfy Rule 6 of the Rules of Civil Procedure – there must be a common legal issue; and
- Even if Rule 6 of the Rules of Civil Procedure is satisfied, the balance of convivence factors must also favour consolidation of the proceedings.