The action arose out of breach of employment contract and breach of fiduciary duty. During his examination for discovery, the defendant specifically denied a number of allegations advanced by the plaintiff. Subsequent to the examination, the plaintiff was granted an order to obtain third party information, which clearly indicated that the defendant had lied in his testimony regarding issues which were pertinent to the action.
Justice Kenny found Mr. Faria in contempt of court based on his deceitful answers during the discovery. However, he did preface this finding by noting that the usual remedy in this circumstance would be to award costs against the deceitful party. It will only be in the ‘extremely rare’ occasion that a party will be found in civil contempt for lying in an examination for discovery, namely, when the deceitful answer is in relation to the main issue and not merely a ‘peripheral’ issue.
This ruling was intended to drive home the fact that examinations for discovery are an essential step in civil litigation. Distorting evidence during the examination can have serious legal ramifications; namely, being found in civil contempt. While Justice Kenny notes that awarding costs against a party who has abused the process is, and continues to be, the usual avenue taken by the courts, this case provides for an alternative, much more severe, sanction. The penalty for civil contempt can include a fine, imprisonment or possibly both. While this decision comes out of Alberta, the finding will likely be used by parties across the Provinces who seek to sanction those abusing the discovery process by giving deceitful answers.