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Garnishment

. Vetro v. Vetro

In Vetro v. Vetro (Fed CA, 2021) the Superior Court set out this useful garnishment decision, dealing with a debtor who only had CPP and ODSP income [the CPP provisions are replicated in the Old Age Security Act, s.36]:
Analysis

[21] Garnishment is an enforcement process of long-standing. Notwithstanding that it is generally available as a matter of course, it nevertheless is considered to be governed by equitable principles. The court retains discretion as to whether it will permit garnishment proceedings: see Parker v. Parker (2014), 19 C.B.R. (6th) 154 (Ont. Div. Ct.) at para. 4; 20 Toronto Street Holdings Ltd. v. Coffee Tea or Me Bakeries Inc. (2001), 2001 CanLII 28048 (ON SC), 53 O.R. (3d) 360 (S.C.J.), at para. 5; International Union of Painters and Allied Trades, Local 200 v. S & S Glass and Aluminum (1993) Ltd. (2004), 2004 CanLII 12611 (ON CA), 185 O.A.C. 38 (C.A.), at paras 19-20.

[22] In this case, garnishment is sought from a number of financial institutions, and from the Canada Pension Plan.

[23] As far as the Canada Pension Plan is concerned, s.65 of the Act creating and governing the Canada Pension Plan is apposite. The relevant provisions provide:
Benefit not to be assigned, etc.

65 (1) A benefit shall not be assigned, charged, attached, anticipated or given as security, and any transaction purporting to assign, charge, attach, anticipate or give as security a benefit is void.

Benefit not subject to seizure or execution

(1.1) A benefit is exempt from seizure and execution, either at law or in equity.
[24] These provisions must be read in conjunction with the Family Orders and Agreements Enforcement Assistance Act, the relevant provisions of which read as follows:
Her Majesty may be garnisheed

24 Notwithstanding any other Act of Parliament preventing the garnishment of Her Majesty, Her Majesty may, for the enforcement of support orders and support provisions, be garnisheed in accordance with this Part in respect of all garnishable moneys.

Provincial garnishment law applies

25 Subject to section 26 and any regulations made under this Part, garnishment under this Part shall be in accordance with provincial garnishment law.

Inconsistencies with provincial garnishment law

26 In the event of any inconsistency between this Part or a regulation made under this Part and provincial garnishment law, the provincial garnishment law is overridden to the extent of the inconsistency.
[25] In Trick v. Trick (2006),2006 CanLII 22926 (ON CA), 83 O.R. (3d) 55 (C.A.), the Court of Appeal held that as a result of these provisions, Canada Pension Plan disability benefits can be garnished to the extent of 50 per cent of the benefits that are payable.

[26] As far as Ontario Disability Support Payments are concerned, the following provisions of the Ontario Disability Support Program Act, 1997, are apposite:
No attachment, etc., of income support

18 (1) Income support under this Act,

(a) is not subject to alienation or transfer by the recipient; and

(b) is not subject to garnishment, attachment, execution, seizure or receivership under any other Act.

Deduction re money owed for family support, etc.

(2) Despite subsection (1), the Director may deduct a portion of income support to recover,

(a) the amount of a support deduction order that is enforceable against a member of the benefit unit under section 20 of the Family Responsibility and Support Arrears Enforcement Act, 1996; or

(b) the prescribed government debts owed by a member of the benefit unit.
[27] In this case, the order is not being enforced by the Family Responsibility Office, and thus s.18(2)(a) does not apply.

[28] In Metropolitan Toronto (Municipality) v. O’Brien (1995), 1995 CanLII 7053 (ON SC), 23 O.R. (3d) 543 (Gen. Div.), O’Brien J. held, in a case that was not a family law case, that where Canada Pension Plan payments are paid into a bank account, the bank account itself ought not to be garnishable to the extent of the CPP payments. He held that to permit garnishment of the bank account would simply be an indirect way of allowing garnishment of the CPP payments, which was impermissible. In the alternative, he held that, garnishment being a discretionary remedy, it was appropriate, in the exercise of his discretion, to decline to permit garnishment.

[29] This reasoning would clearly apply to the ODSP payments, but, subject to the ability to garnish 50 per cent of the payments, would not apply to the CPP disability payments.

[30] That leaves me, in the final analysis, with the question of whether I ought to exercise my discretion in Mr. Vetro’s favour, and decline to allow garnishment in these circumstances.

[31] The evidence is uncontradicted (although Ms. St. George sought to persuade me that I should not accept it) that since Mr. Vetro’s bankruptcy in 2013, he has been unemployed and suffers from serious psychological and psychiatric conditions. His only source of income is the CPP disability payments and the ODSP payments. He lives with his parents, and it is clear that there are no assets out of which the claim for over $800,000 can be satisfied.

[32] On the other hand, Ms. St. George does not dispute that she lives a very comfortable lifestyle, and she and her spouse have been very successful in accumulating a considerable degree of wealth. While this is irrelevant to a Motion to Change, as held by Miller J., it is relevant to the exercise of my discretion in the garnishment proceedings.

[33] The parties’ children are well-educated and three of them are working in Europe. The other is in a Master’s program in England.

[34] In my view, to permit garnishment in these circumstances would be inequitable. Mr. Vetro is close to living in poverty, and is unable to work. Ms. St. George is living in relative luxury. To deprive Mr. Vetro of his modest CPP and ODSP payments, in whole or in part, would be unjust. In the exercise of my discretion, I decline to permit garnishment, and I order that the notices of garnishment be set aside.


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