Executive Summary: Key Legal and Evidentiary Issues

• Niagara Peninsula Energy Inc. obtained a default judgment of $129,622.17 against 12476436 Canada Inc. for unpaid electricity invoices, but the defendant failed to satisfy the judgment.
• Civil contempt proceedings were initiated after the defendant's sole director, Abhinav Kumar, repeatedly failed to attend court-ordered examinations in aid of execution and produce required financial documents.
• Rule 60.11(5) and (6) of the Rules of Civil Procedure governed the court's broad sentencing discretion, including its authority to make orders personally against Mr. Kumar as the sole director of the defendant corporation.
• Sentencing in civil contempt serves the dual purpose of coercing compliance with outstanding court orders and denouncing conduct that undermines judicial authority.
• Aggravating factors included Mr. Kumar's continued non-production of documents, the insufficiency of his sworn affidavit, and outstanding unpaid costs orders from prior proceedings.
• Joint and several liability for costs of $37,836.90 was imposed on both the defendant corporation and Mr. Kumar personally, payable in monthly installments over seven months.

Facts of the case

Niagara Peninsula Energy Inc. is a licensed Ontario electricity distribution company. On November 23, 2023, it commenced an action against 12476436 Canada Inc. for non-payment of invoices related to the supply of electricity. The plaintiff obtained default judgment on April 25, 2024, with the court ordering the defendant to pay $129,622.17, plus pre- and post-judgment interest, and costs fixed at $1,987.88 plus interest. None of those payments were made.

To enforce the judgment, the plaintiff scheduled an examination in aid of execution for June 26, 2024, with Abhinav Kumar — the owner and sole director of the defendant corporation — as the deponent. Mr. Kumar did not attend. In November 2024, Justice Yamashita ordered Mr. Kumar to attend a rescheduled examination and to produce specified financial documents at least seven days prior. She also ordered the defendant to pay costs thrown away for the missed examination of $2,324.98, and motion costs of $752.58, both payable within 30 days. Mr. Kumar again failed to attend the rescheduled examination, failed to produce the required documents, and made none of the ordered cost payments.

On November 24, 2025, Justice Petersen found the defendant to be in contempt of Justice Yamashita's orders dated November 26 and 28, 2024. The court gave the defendant an opportunity to purge the contempt before sentencing, ordering Mr. Kumar to deliver the required documents by January 30, 2026, and to attend an examination in aid of execution by February 20, 2026. The present endorsement addresses the sentencing phase of the contempt motion, heard May 22, 2026.

Procedural rules and legal framework

Rule 60.11(5) of the Rules of Civil Procedure grants the court broad discretion to impose sentencing orders in contempt cases, including imprisonment, fines, cost orders, orders to do or refrain from specific acts, and writs of sequestration. Rule 60.11(6) extends this authority to officers and directors of a corporation found in contempt, giving the court jurisdiction to make orders personally against Mr. Kumar as the sole director of the defendant.

The court drew on the sentencing framework set out by the Court of Appeal in Boily v Carleton Condo Corp. 145, 2014 ONCA 574, which identifies proportionality, mitigating and aggravating factors, deterrence and denunciation, parity with similar cases, and the reasonableness of fine or incarceration as the relevant considerations. The overarching sentencing objective in civil contempt, as established in Korea Data Systems Co. v. Chiang, 2009 ONCA 3, and affirmed in Business Development Bank of Canada v. Cavalon Inc., 2017 ONCA 663, is to coerce compliance with outstanding court orders while also serving a public law function of denouncing conduct that undermines respect for judicial authority.

Court's reasoning and analysis

Justice Petersen identified limited mitigating weight in Mr. Kumar's eventual attendance at the examination in aid of execution on February 18, 2026. Although he was cooperative during questioning, he gave undertakings at the examination that remained unanswered as of the sentencing date, with the plaintiff's counsel having sent him a chart of those undertakings on March 17, 2026 — more than two months prior — without any response.

The aggravating factors were substantial. Mr. Kumar failed to comply with the November 24, 2025 orders designed to purge the contempt. He produced no documents before the February 18, 2026 examination. His sworn affidavit dated January 28, 2026, was found to be brief and inadequate — containing only bare denials, with no meaningful explanation of his efforts to obtain and produce the required records. The court provided specific examples of deficiencies: Mr. Kumar's affidavit stated he had no tax documents for 2022 onward but offered no explanation as to whether taxes were filed, what happened to the records, or what steps he took to obtain copies from the Canada Revenue Agency. Similarly, while he acknowledged that a bank account had been closed due to a negative balance and that he had requested archived statements, no statements were ultimately produced and no explanation or evidence was provided as to why. His affidavit also contained an internally inconsistent claim that no property had been disposed of, while simultaneously acknowledging that a vehicle and real property had been repossessed, and that other property had been repossessed with its contents disposed of — with no accompanying documentary detail on any of these matters.

The court further noted that the defendant's prolonged non-compliance had caused the plaintiff to incur significant costs in pursuing disclosure and examinations, and that prior costs orders against the defendant remained unsatisfied — each constituting an additional aggravating factor. Justice Petersen found that because Mr. Kumar had provided no financial disclosure, it was unknown whether the corporate defendant could satisfy a costs award, making a personal order against Mr. Kumar not only appropriate but necessary to give the costs award practical effect. The court drew on Corporation of the Municipality of South Bruce v 1260964 Ontario Inc., 2015 ONSC 2206, which affirmed that joint and several liability for substantial indemnity costs is appropriate where a corporate defendant's contempt stems from the decisions and inaction of its controlling officer and director.

Regarding Mr. Kumar's request for leniency based on personal financial hardship — including his testimony that his home had been taken by the bank and that he and his spouse had been moving between friends and family while he remained unemployed — the court declined to reduce the quantum of costs, finding that doing so would undermine the fundamental purposes of sentencing. However, the court accommodated his circumstances by allowing payment in monthly installments over seven months.

Ruling and overall outcome

The plaintiff, Niagara Peninsula Energy Inc., was successful on the contempt sentencing motion. The court granted all four sanctions sought by the plaintiff: orders compelling Mr. Kumar to deliver the documents specified in Justice Yamashita's schedule and to file a further sworn affidavit detailing his efforts to obtain any documents he cannot produce; an order requiring Mr. Kumar to fulfill the undertakings given at his February 2026 examination by no later than June 22, 2026; an order scheduling a follow-up virtual hearing on June 25, 2026 to monitor compliance and address further sanctions if necessary; and an order for joint and several costs against the defendant corporation and Mr. Kumar personally in the amount of $37,836.90, payable on a substantial indemnity basis. The costs are to be paid in monthly installments, with a first payment of $7,836.90 due by June 22, 2026, followed by six monthly installments of $5,000 each, commencing August 1, 2026 and ending January 1, 2027. The court expressly put Mr. Kumar on notice that further sanctions, including a fine and imprisonment, may be imposed at the June 25, 2026 hearing if the contempt remains unpurged.