Practice — Judgments and orders — Summary judgments — When available — Contracts — Illegal contracts — Contracts contrary to public policy — Agreement contrary to terms of bail conditions.

   This was an application by the respondent for summary judgment in terms of a settlement agreement.  The petitioner signed an agreement with the respondent settling all issues in matrimonial proceedings but thereafter had second thoughts and sought to disavow it.  The proceedings had been intensely litigious and two criminal charges of harassment had been laid against the respondent.  The bail condition in effect at the time of the agreement provided that the respondent was to have no contact directly with the petitioner or the children except as permitted for psychological assessments of the children. Access to the children was to be supervised.  The agreement provided that the respondent was to be able to have access to the children without supervision in clear breach of the terms of the bail order. The petitioner argued that the agreement was illegal and therefore void.

   HELD:  The application was dismissed.  The petitioner's claims of undue influence and unconscionability were not made out. The agreement was not too vague to be enforced.  Writing down of the oral agreement did not reopen the issues covered by the agreement.  However the offending paragraphs amounted to an agreement to frustrate the bail order and to interfere substantially with an ongoing prosecution.  They disclosed that an illegal purpose was at the heart of the agreement such that the agreement was void as contrary to public policy.  The agreement was complex and represented an overall compromise of the issues between the parties in which consideration flowed both ways.  The offending paragraphs were not severable in the context of such an agreement.

Counsel:

¶ 1      PRESTON J.:— The respondent applies pursuant to R. 18A for an order in the terms of an agreement (the "Agreement") reached between the parties with the assistance of their counsel.  The Agreement deals with and settles all of the issues in the litigation.  It was reached over the course of a number of hours of negotiations in the courthouse after an appearance in chambers.  Both counsel confirm that an agreement was reached and that it settled the matters in issue.  The Agreement was reduced to writing in the form of notes and signed by the parties.  The petitioner had second thoughts about the Agreement after leaving the court and now seeks to disavow it.  She raises allegations of undue influence and unconscionability.  She contends that the Agreement is too vague to be enforced and that a written form of agreement tendered by the respondent's counsel to give effect to the settlement amounts to the tendering of a new agreement having the effect of re-opening the issues covered by the Agreement.  She also alleges that the Agreement is illegal and should be declared void as a matter of public policy.

¶ 2      I am satisfied that none of the petitioner's grounds for seeking to avoid the Agreement have merit except the last.

¶ 3      This is a matrimonial proceeding.  The parties were married on December 22, 1972 and separated June 26, 1995. They have three children aged 8, 11, and 13.  The level of acrimony is extreme.  The proceedings have been intensely litigious.  Two criminal charges of harassment of the petitioner pursuant to s. 264 of the Criminal Code have been laid against Mr. Hadfield.  A preliminary hearing was held and he was committed for trial in this Court on those charges in May 1996.

¶ 4      The Agreement deals with custody, guardianship, access, spousal and child maintenance, life insurance, medical and health insurance, the matrimonial home, chattels, and under the heading "miscellaneous," the criminal proceedings. Two paragraphs of the order are relevant to the allegation of illegality:

       and shall advise and instruct Crown Counsel accordingly.

¶ 5      The Provincial Court bail condition in effect at the time the parties entered into the Agreement consisted of the original bail order with a later addition.  It read as follows:

¶ 6      Paragraph 2(d) of the Agreement is in clear breach of the terms of the bail order.

¶ 7      The petitioner contends that paragraph 8(a) is an agreement to stifle prosecution and, accordingly, illegal.

¶ 8      Contracts to stifle prosecution are illegal and void: Leggatt v. Brown (1899), 30 O.R. 225 (Ont. Div. Ct.); Morgan v. McPhee (1908), 18 O.L.R. 30 (Ont. Div.Ct.); Fuller v. Stoltze [1938] 1 W.W.R. 241 (Sask. C.A.).  Halsbury states the rule as follows (8 Hals. (3d) 136):

¶ 9      The respondent contends that the proper approach to this matter is to sever paragraph 2(d) and to find that paragraph 8(a) is not illegal because Mrs. Hadfield does not have conduct of the prosecution or, alternatively the harassment charges are not "an offence of a public nature." He submits that only Crown counsel has the power to stay the criminal proceedings.

¶ 10      Because of the nature of the settlement agreement, it is apparent that consideration flowed both ways in its making.  It represents an overall compromise of the differences between the parties on a number of issues.  In the context of an agreement of this complexity, paragraph 2(d) is not severable.  The fact that the access never did take place as contemplated by that paragraph and that the operative date of that access is past does not assist the respondent.  The question of whether the Agreement is void must be answered as of the date of the making of the Agreement.

¶ 11      The two offending paragraphs must be considered together.  They amount to an agreement to frustrate the bail order of the Provincial Court and to interfere substantially with an ongoing prosecution.  Those terms of the Agreement, taken together, disclose an illegal purpose which is at the heart of the Agreement.  The Agreement is void as contrary to public policy.

¶ 12      The respondent's application is dismissed.  The petitioner is entitled to costs of the application on scale 3. The grounds upon which the petitioner was unsuccessful contributed substantially to the length of time required to hear the application.  Accordingly, costs are to be assessed as if the hearing of the motion had taken only one day.

PRESTON J.

QL Update:  970107
cp/d/jep/mjb/DRS/DRS

Mr. Justice Preston