The Appellant appealed an Order granted by Justice Jerke permitting the Respondent to discontinue his matrimonial property claim. The Statement of Claim sought an Order for matrimonial property distribution in such a manner as the Court deems just and equitable. The Appellant did not file a Statement of Defence or Counterclaim, but did file a Demand for Notice. As the Action proceeded, funds were paid into Court and two disclosure Orders were made against the Respondent, with which he did not comply. The Appellant filed an Application seeking to have the Respondent held in contempt and for leave to file a Statement of Defence and Counterclaim. The Respondent then sought to discontinue his Claim. Justice Jerke had held that, pursuant to Rule 4.36, the Respondent was entitled to discontinue the claim, since there had been no abuse of process.

The Court of Appeal reviewed Rules 3.34 and 12.11 regarding the effect of a Demand for Notice and noted that if a Defendant in a family law claim does not wish to oppose the relief sought in a Statement of Claim, then a Demand for Notice is sufficient. The Court of Appeal then stated that the Statement of Claim in this case was different from an ordinary Statement of Claim because it sought relief that was beneficial to both parties.

When the Respondent indicated that he was prepared to abandon his claim, but the Appellant was not prepared to abandon her claim, the Court was required to consider whether it was appropriate to grant the Appellant permission to replace her Demand for Notice with a Statement of Defence pursuant to Rule 3.34(5). Whether a Defendant should be granted relief pursuant to Rule 3.34(5) is a discretionary Decision requiring consideration of all the circumstances, including: (i) the relief sought in the claim; (ii) the fact that the Appellant admitted the relief was appropriate; (iii) the Appellant’s legitimate expectation that the matrimonial property would be divided on the basis requested by the Respondent; (iv) any delay in applying; (v) the conduct of the parties; and (vi) any prejudice that would result to either party. The Court of Appeal noted that the reasons of the Chambers Judge did not consider these factors and found that the Appellant had met the test for substituting her Demand for Notice with a Statement of Defence and Counterclaim. Accordingly, the Court allowed the Appeal.

The Court of Appeal also noted that a discontinuance of a claim can be prevented where it would be obstructive, abusive or unfair, or where there are outstanding issues between the parties, such as on the current facts where there was money paid into Court and there was an outstanding Application for contempt against the Respondent Plaintiff. The Chambers Judge dealt with the discontinuance of claim issue first, but the correct order of proceeding was to deal with the Application for contempt, then the Application to file a Defence and Counterclaim, and then the discontinuance of claim issue.

For these reasons, the Court of Appeal allowed the Appeal and permitted the Appellant to file a Statement of Defence and Counterclaim. The Respondent was permitted to discontinue his Claim, but that would not prevent the Appellant from pursuing her Counterclaim, pursuant to Rule 3.58. Finally, the Court of Appeal denied the Appellant any photocopying disbursements because she had included copies of the Chambers Briefs in the Appeal Record, in contravention of Rules 14.18 and 14.27.