10.52: Declaration of civil contempt

Case Summary

The Plaintiff, Envacon Inc. (“Envacon”) applied to have the Defendant, 829693 Alberta Ltd. (“829 Ltd.”) held in Contempt of Court for failure to produce financial records as required by Court Order. Envacon sought to have 829 Ltd.’s Statement of Defence struck as a remedy.

Associate Chief Justice Rooke noted that Rule 10.52 governs contempt and the four elements required to establish contempt that an applicant must prove beyond a reasonable doubt are whether: (1) there is a Court Order requiring action by the respondent party; (2) the respondent party has had notice of the Court Order; (3) the respondent party is guilty, through its directors, of an intentional act or failure to act that constitutes a breach of a Court Order; and, (4) on a balance of probabilities, the respondent party has breached the Court Order without adequate excuse.

The Respondent did not challenge that there were Court Orders requiring it to disclose financial records, and that it had notice of the Court Orders. However, the Respondent argued that it was not in breach of these Orders and furthermore that it had adequate excuse insofar as it failed to produce the required financial records. A.C.J. Rooke held that 829 Ltd. was in breach of the Order, and with respect to an adequate excuse, the Respondent was merely “going through the motions” as opposed to making a genuine attempt to comply with a Court Order. There was therefore no justification for the breach and 829 Ltd. was held in contempt.

A.C.J. Rooke noted that striking pleadings is discretionary and is only appropriate when the breach of a Court Order prevents the other party from defending (or prosecuting) an Action, or where the breach flaunts an Order, or demonstrates a persistent failure to obey. His Lordship also observed that a party in contempt cannot be given infinite chances to comply. A.C.J. Rooke ordered that 829 Ltd.’s pleadings would be struck if the required records were not produced within three months.

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