COURT OF APPEAL FOR ONTARIO
van Rensburg, Paciocco and Thorburn JJ.A.
BETWEEN
Barbara Lang-Newlands
Applicant (Respondent)
and
Ian Newlands
Respondent (Appellant)
Jonathan Lisus, Harold Niman, Daryl Gelgoot and Jen-Yii Liew, for the appellant, Ian Gordon Newlands
J. Thomas Curry, Derek Knoke and Aaron Franks, for the respondent, Barbara Lang-Newlands
Heard: January 13, 2026
On appeal from the order of Justice Mohan Sharma of the Superior Court of Justice, dated November 15, 2024, with reasons reported at 2024 ONSC 6285, and from the costs order, dated May 5, 2025, with reasons reported at 2025 ONSC 2739.
I. OVERVIEW
1This is a high net-worth family law dispute. The primary issue is whether to treat the respondent wife, Barbara Lang-Newlands’s (“Barbara’s”) interest in a family trust, formed following an estate freeze, as a gift before or after marriage. If it is a gift before marriage, the appellant husband, Ian Newlands (“Ian”), shares in the growth in value of this interest during the marriage; if it is a gift after marriage, he does not.
2Significant sums are at stake. Before the parties’ marriage, Barbara’s father settled a trust that held shares in his business. Barbara was the sole beneficiary and would acquire its assets at the age of 39. The shares were worth approximately $16 million at the date of marriage. During the marriage, and before turning 39 years old, Barbara received the shares from the trust. Eight years later, the shares were the subject of an estate freeze.
3The estate freeze involved Barbara’s father settling a new trust for $100 (the “Newlands Family Trust” or the “NFT”), the creation of a new holding company, Barbara selling her shares to this new holding company, and receiving $24.5 million in preferred shares in return. The NFT purchased 100 common shares of the new holding company, and as such, the NFT was entitled to the future growth in the value of the shares held by the holding company. The beneficiaries under the NFT were Barbara and the parties’ four children. At the time the parties separated, Barbara’s 20 percent interest in the NFT was valued at approximately $134 million.
4The husband, Ian, appeals the final order of the trial judge who concluded that (i) he was bound by this court’s decision in Shinder v. Shinder, 2018 ONCA 717, 142 O.R. (3d) 321, to exclude Barbara’s interest in the Newlands Family Trust from her net family property for the purpose of equalization; and (ii) Barbara pay Ian monthly support in the amount of $25,649 per month retroactive to August 1, 2019 indefinitely, (rather than the monthly sum of $56,729 he seeks). He also seeks leave to appeal the costs order, where the trial judge ordered Ian to pay $2.8 million in costs.
5Section 4 of the Family Law Act, R.S.O. 1990, c. F.3, distinguishes gifts received before marriage from those received after marriage. The former are “deductions” for the purpose of calculating net family property, such that their value at marriage is deducted from net family property, but any growth is included. In contrast, gifts received after marriage, and any income derived from them, are “excluded property” under the Act and do not form part of net family property subject to equalization.1 It is considerably more financially advantageous for Barbara if her interest in the NFT is treated as a gift after marriage.
6Ian claims that the trial judge erred in relying on Shinder to exclude Barbara’s interest in the NFT from her net family property. He claims that the gift from Barbara’s father was made before marriage and the estate freeze did not create a new gift from her father. Since the transfer of value from her father to Barbara occurred before marriage, the value of her interest in the NFT should be included in the calculation of Barbara’s net family property and subject to equalization.
7The respondent, Barbara, claims that the trial judge was correct in holding that her value in the NFT should be excluded from her net family property as the estate freeze transformed the previously gifted shares from her father into a new gift from her father after marriage.
8The trial judge held that he was bound by this court’s decision in Shinder at para. 58, which in his view already decided that the effect of an estate freeze was to create a new gift.
9Unusually, this was not the end of the trial judge’s decision. He went on to explain at length why, if he were not bound by this court’s decision in Shinder, he would instead include in her net family property Barbara’s 20 percent interest in the NFT (as she and her four children each had an equal interest in the NFT), subject to an equitable reduction.
10Before addressing this central issue of whether Barbara’s interest in the NFT should be characterized as a gift from her father after marriage, I will set out: (1) the relevant context of net family property and equalization under the Family Law Act; (2) the background facts of this case that are largely undisputed; (3) the trial judge’s interpretation of Shinder and whether it is determinative of this case; followed by (4) my own analysis of the interaction between the estate freeze and the definition of excluded property under s. 4(2) of the Family Law Act. After providing my conclusions on the equalization issue, I will address Ian’s other grounds of appeal, namely the monthly support payable to Ian, and the order that he pay trial costs.
a. THE LEGISLATIVE SCHEME
11As set out in its preamble, the goal of Ontario’s Family Law Act is to “recognize the equal position of spouses as individuals within marriage and to recognize marriage as a form of partnership”. Unlike its predecessor – the Family Law Reform Act, R.S.O. 1980, c. 152, which featured a division of property scheme – Ontario’s Family Law Act adopted an equalization payment regime. Separating spouses are, generally speaking, entitled to receive one-half of the value of all property accumulated during the marriage: Thibodeau v. Thibodeau, 2011 ONCA 110, 104 O.R. (3d) 161, at para. 37.
12The value of each party’s property accumulated during the marriage, or “net family property” is defined in s. 4(1) of the Family Law Act as
[T]he value of all the property, except property described in subsection (2), that a spouse owns on the valuation date after deducting
(a) the spouse’s debts and other liabilities, and
(b) the value of property, other than a matrimonial home, that the spouse owned on the date of the marriage …
13Section 4(2) of the Family Law Act provides that:
The value of the following property that a spouse owns on the valuation date does not form part of the spouse’s net family property:
Property, other than a matrimonial home, that was acquired by gift or inheritance from a third person after the date of the marriage.
Income from property referred to in paragraph 1, if the donor or testator has expressly stated that it is to be excluded from the spouse’s net family property.
14As such, a gift or inheritance acquired before marriage is treated as a deduction such that the appreciation is shared. However, a gift or inheritance received during a marriage from a third party and its appreciation are excluded from net family property and therefore not subject to equalization.
15The recipient of an appreciating gift or inheritance therefore benefits far more if the gift is received after marriage than if it is received before.
b. BACKGROUND FACTS
Barbara and Ian’s marriage
16Barbara and Ian married in 1987. They have four adult children.
17During the marriage, they had an expensive lifestyle with homes in Toronto, Muskoka, Ellicottville and Florida, as well as horse expenses in the amount of at least $7 million, and ongoing horse-related expenses of about $720,000 annually.
18Ian worked and provided for the family. He contributed his income and inheritance to the family and allowed the family to use credit in his name. Barbara made contributions from her interest in the NFT. For the duration of their marriage, theirs was a financial partnership.
19Ian stopped working full time in 2012 and has experienced mental health and physical challenges. The trial judge found that for the last seven years of their marriage, Ian was financially dependent on Barbara.
20The trial judge found that Barbara was a largely credible witness while Ian was “sometimes argumentative, and it was clear some of his evidence was false, and possibly intentionally false”. He held that some of Ian’s evidence which he found to be false
…was only corrected after it was presented to him that Barb was in Florida and could not have attended BMO’s offices. He also admitted forging Barb’s signature on other documents … after suggesting that these signatures were Barb’s or may have been Barb’s. Not only did he forge her signature, he also admitted to directing his former assistant to witness Barb’s forged signature.
I am persuaded that Ian had motive to deceive the court on material pieces of evidence and that he attempted to do so on some occasions.
21These findings were accounted for in the trial judge’s costs award.
22Barbara and Ian separated on July 31, 2019 after nearly 32 years of marriage.
Barbara’s BJL Trust before marriage
23In 1951, Barbara’s father established a business called CCL Industries (“CCL”) which became very profitable.
24Before her marriage to Ian in 1987, Barbara’s father settled a trust called the Barb Joan Lang Trust (“the BJL Trust”) that held 90 common shares of 702303 Ontario Inc. (“702”) that in turn held shares in CCL.
25Barbara was the sole beneficiary of the BJL Trust, though not a trustee. Under the terms of the BJL Trust, if the trust was not collapsed beforehand, Barbara was to acquire its assets outright when she turned 39 years old.
26When Barbara and Ian married in 1987, Barbara’s beneficial ownership of the BJL Trust shares was worth about $16 million. This sum is considered a premarital asset.
The estate freeze that established the Newlands Family Trust
27In 1993, after her marriage to Ian and before she turned 39 years old, Barbara received her shares in 702 directly from the BJL Trust, prompted by her father’s health scare. Eight years later, in 2001, these 702 shares were the subject of an estate freeze and were ultimately transferred to the Newlands Family Trust.
28An estate freeze is a tax and estate planning strategy. It separates the current value of an asset – usually, shares in a private company – from its future growth value. The purpose of an estate freeze is to transfer the future growth value of the shares to others (such as children or grandchildren) while the transferor retains the current value.
29This is done by the transferor exchanging the original “growth” shares for new, “frozen” assets that will not increase in value (like fixed-value preferred shares2).
30The original shares are then transferred or put into a trust. The transferor gets an income stream from dividends on the fixed-value preferred shares or may redeem the preferred shares for par value in cash. The transferees get the benefit of the growth value of the original shares.
31This defers the payment of taxes that would arise if the original shares were willed to the transferees or gifted.
32The estate freeze transaction in this case was conceived by Barbara’s father and executed on the instructions of his lawyers using Barbara’s assets. Barbara’s father provided the initial trust settlement of $100, but all other assets involved in the transaction came from Barbara.
33On August 22, 2001, Barbara’s father settled the NFT for $100. The trustees were three of Barbara’s father’s children (Barbara and her two brothers). The beneficiaries of the NFT were Barbara and her four children.
34On August 27, 2001, a holding company called 4MyKidz Inc. was created. On September 24, 2001, Barbara became 4MyKidz’ sole director. The NFT purchased 100 common shares of 4MyKidz for $100. At this time, 4MyKidz had no assets.
35Barbara then sold her 702 shares to 4MyKidz in exchange for fixed-value preferred shares in 4MyKidz that were valued at approximately $24.5 million.
36Barbara testified that, “The original shares I had [before marriage], I, I sold them to, [4MyKidz after the marriage], and I got $24 million with pref shares…I could use that money whenever I wanted.”
37The NFT was intended to and did receive the future growth in the value of the 702 shares via the NFT’s ownership of 100 common shares in 4MyKidz.
38Barbara and the parties’ four children are the five equal beneficiaries under the NFT. As one of the beneficiaries, Barbara had a part-interest in the growth value of the 702 shares that she put into 4MyKidz for the NFT.
39Between the time the NFT was settled and the date of separation, the value of the 702 shares held indirectly by the NFT grew from $24.5 million to approximately $670 million.
II. THE TRIAL JUDGE’S DECISION
40The trial judge wrote careful and detailed reasons. I would accept and adopt all his factual findings. I would also adopt his alternative analysis. I disagree only with his legal conclusion that one paragraph in this court’s decision in Shinder was binding on the facts of this case.
41The trial judge held that Barbara’s interest in the NFT was “property” within the meaning of the Family Law Act. He also accepted that Barbara’s father intended to give her a gift when he settled the NFT. He then considered when and what gift was made.
42The trial judge concluded that he was bound to exclude Barbara’s interest in the NFT from equalization given that this court’s decision in Shinder was “on all fours” with the facts in this case. Paragraph 58 of Shinder reads in relevant part, as follows:
The trust comprised Sol’s [Neil’s father] property3 and Neil’s common shares in Coofer that had originally been given to him by Sol and then exchanged for preference shares that were disclosed to Randi [Neil’s wife] and included in both of Neil’s financial statements. In the face of the disclosure of these Coofer shares, any additional benefits Neil might receive under the trust would constitute a gift or inheritance acquired after the date of the marriage and hence would have to constitute excluded property as defined under the Family Law Act. [Emphasis added.]
43The trial judge went on to hold that “critical analysis [of s. 4(2) of the Family Law Act] in Shinder is missing”. He then proceeded to provide a detailed and comprehensive alternative analysis of whether Barbara’s interest in the NFT would be excluded if Shinder were not binding.
44He held that if his alternative analysis were adopted, Barbara’s interest in the NFT would be included in her net family property because “it was Barb’s own asset, gifted to her before marriage, that became the property of the NFT.” In this scenario, the equalization payment to Ian would be nearly $26 million (instead of $1.1 million if Shinder is binding), which he would then have reduced to $18 million on the basis that an equalization payment of $26 million would be unconscionable under section 5(6) of the Family Law Act.
45The trial judge’s alternative analysis can be summarized as follows.
46He noted that, although Barbara took the position that her beneficial interest in the NFT created a new gift after marriage, “[w]here Barb’s logic fails is that [her father] did not divest himself of property and transfer it to Barb (or her children) [after her marriage], other than his $100 used to establish a trust as settlor”. Rather, it was the growth value in the 702 shares that formed the entire subject of the trust, which she already owned before marriage. and these shares were ultimately the substance of the NFT.
47The trial judge concluded at para. 301 that:
The FLA does not … permit a spouse who acquires a gift before marriage to exclude the growth in value of that gift during the marriage from [net family property] calculations, simply because the spouse placed the growth in value of that gift into a trust.
48The trial judge therefore held that, if he were not bound by Shinder, he would assign Barbara 20 percent of the value of the NFT as one of five equal beneficiaries along with her four children, after applying a 50 percent overall minority/illiquidity discount, consistent with the discount accepted by this court in LeVan v. LeVan (2006), , 82 O.R. (3d) 1 (S.C.), aff’d 2008 ONCA 388, 90 O.R. (3d) 1.
49He then considered the value of Barbara’s 20 percent interest after applying the 50 percent discount. Barbara’s expert valuator, Paula White, accounted for past distributions from the NFT to provide for an equal distribution of the NFT among the beneficiaries. Ian suggests that valuations prepared by KPMG were the best evidence of an appropriate discount (which would be considerably smaller than the one applied by the trial judge), but the KPMG report was prepared for a different purpose, and Ian never called the KPMG expert to testify. The trial judge preferred Ms. White’s evidence.
50Applying Ms. White’s discounts, the trial judge found that Barbara’s interest in the NFT was $40,386,000 on the date of separation. Based on this calculation and others, he calculated the equalization payment that would be owed by Barbara to Ian if Shinder were not binding, at $25,748,826.01.
51He went on however, to hold that an equalization payment in this amount would be unconscionable as Barbara received only 17 percent of the post-separation distributions when the NFT was reorganized in 2022, thereby reducing her net family property by over $11 million. Payment to Ian of $25,748,826.01 would result in Ian having a higher net worth than Barbara. This was particularly troublesome since Barbara had paid a disproportionate amount of the family debt, Ian had mismanaged finances, taken money, and forged her signature to make investments for himself. The trial judge held that these actions were unconscionable and were a breach of trust.
52The trial judge therefore held that the alternative equalization amount payable by Barbara to Ian, if he were not bound to follow Shinder, should be reduced to $18 million payable over eight years.
53Turning to support, there was no dispute that Barbara’s annual income for support purposes was $1,761,000. Ian’s imputed annual income was $548,250 based on a reasonable return on $8.5 million in assets. The trial judge therefore ordered that, since he was bound by Shinder to exclude Barbara’s interest in the NFT in calculating her net family property, Barbara should pay Ian $25,649 per month from August 1, 2019 indefinitely in support and an equalization payment of $1,183,495.01. He provided an alternative analysis for spousal support if Barbara’s interest in the NFT were not excluded from the calculation of her net family property, which would have terminated Ian’s right to receive spousal support on the date of payment of the first equalization amount.
54In his costs decision, the trial judge held that, given Barbara’s relative success at trial, the offers to settle, and Ian’s behaviour before and at trial, Ian was required to pay Barbara’s costs in the amount of $2,800,000.
III. ANALYSIS
55I will set out the standard of review, the parties’ submissions on the issue of net family property, what constitutes “net family property”, whether Shinder is binding in this case, and my conclusion as to whether Barbara’s interest in the NFT should be characterized as a gift before or after marriage and should be included in the calculation of her net family property.
a. The standard of review
56The issue of how to characterize Barbara’s interest in the NFT under the Family Law Act is a question of law. Determining the value of that interest, and whether an equal division would be unconscionable, are questions of fact or mixed fact and law that are entitled to deference. An award of spousal support should not be overturned absent material error, such as a serious misapprehension of the evidence or an error in law: R.L. v. M.F., 2025 ONCA 595, at paras. 20-21. A costs award should be set aside only when the trial judge made an error in principle, or if the costs award is clearly wrong: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, [2005] 1 S.C.R. 303, at para. 27.
b. The parties’ submissions
57Ian submits that there was no analysis in Shinder of the statutory requirements of a gift from a third party after marriage or the reach of s. 4(2) since in that case, the exclusion of the trust interest was not a contentious issue. Ian asserts that the trial judge’s alternative analysis, which he undertook in the event he was not bound by Shinder, is correct. Barbara’s interest in the NFT is not a gift made after her marriage, so her share of the NFT should be included in the calculation of Barbara’s net family property. This, he submits, is supported by the trial judge’s factual findings about the estate freeze and the transfer of property from Barbara’s father to her in 2001.
58Barbara claims that the effect of the estate freeze was a gift from her father who settled the NFT and made her and her children, beneficiaries on August 22, 2001. This was after she married Ian and was part of her father’s estate planning. Until 2001 she was unable to sell her shares for her sole benefit as that was part of her agreement with her father. As such, she asserts that the gift from her father was not realized until after the marriage and that her interest in the NFT should be excluded from the calculation of her net family property.
59She claims that Shinder is on all fours with the facts in this case and is binding on this court. She also claims the trial judge erred by neglecting to respect the distinct legal ownership of the 702 common shares.
c. What is “net family property” within the meaning of s. 4(2) of the Family Law Act?
60The central issue is whether a trust created following an estate freeze after marriage with $100 from a spouse’s parent, but containing only shares given to the spouse before the date of marriage, should be characterized as a “gift after marriage” from a third party. If so, it would be excluded from the calculation of net family property under the Family Law Act.
61Barbara has the onus of establishing an exclusion to her net family property: s. 4(3) of the Family Law Act.
62Property is defined in the Family Law Act to include:
any interest, present or future, vested or contingent, in real or personal property and includes
(a) property over which a spouse has, alone or in conjunction with another person, a power of appointment exercisable in favour of himself or herself [Emphasis added.]
63As such, Barbara’s beneficial interest in the NFT is “property” within the meaning of the Act.
64A gift is a gratuitous transfer of property to a third party: McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 401, at paras. 23-24. Once the transfer is made, the gift is complete: Townshend v. Townshend, 2012 ONCA 868, 113 O.R. (3d) 321.
65There is no dispute that Barbara acquired property by gift from her father. The issue in this case is whether Barbara’s interest in the NFT is properly characterized as acquired by gift before or after the date of marriage.
1. This court’s decision in Shinder was not binding on the trial judge
66The trial judge held that this court’s decision in Shinder was binding on him such that Barbara’s share in the NFT must be considered a gift after marriage and therefore excluded from the calculation of her net family property.
67Shinder involved an appeal from the dismissal of a summary judgment motion. The motion judge in that case held that summary judgment should not be granted as there was significant non-disclosure prior to signing a separation agreement. This court granted the appeal largely on the basis that there was no significant non-disclosure prior to signing the separation agreement.
68In Shinder, a husband (Neil) and his wife were separating. Before the marriage, Neil had owned shares in his father Sol’s company (Coofer). During the marriage, Neil’s father set up a family trust, of which Neil was one beneficiary. That trust included both Neil’s pre-marriage Coofer shares, and additional property from Sol. On separation, Neil’s wife argued that Neil had not properly disclosed his beneficial interest in that family trust. The issue of what constituted net family property was not central in that case.
69The trial judge relied on paragraph 58 of Shinder where this court held that, “any additional benefits [the husband] Neil might receive under the trust would constitute a gift or inheritance acquired after the date of marriage and hence would have to constitute excluded property”.
70In my view, the underlying facts in Shinder are distinguishable. At paragraph 58, this court in Shinder held that
The trust comprised Sol's property and Neil's common shares in Coofer that had originally been given to him by Sol and then exchanged for preference shares that were disclosed to [Neil’s wife] and included in both of Neil's financial statements. In the face of the disclosure of these Coofer shares, any additional benefits Neil might receive under the trust would constitute a gift or inheritance acquired after the date of the marriage and hence would have to constitute excluded property as defined under the Family Law Act. [Emphasis added.]
71The Shinder trust, unlike the NFT in this case, was made up of both Neil’s shares that he held before marriage, and property from his father Sol that was placed in the trust during the marriage. This court held that Neil’s ownership of the Coofer shares had been disclosed. The “additional benefits” Neil received under the trust after marriage were from his father’s property. This court therefore held in Shinder that, given that the “additional benefits” Neil received after his marriage from the trust came from his father, they would constitute a gift or inheritance to be excluded from net family property.
72By contrast, in the present case, the trial judge found at paras. 288 and 289 of his decision, that Barbara’s father did not transfer any value to the NFT after Barbara’s marriage except for the $100 to set up the NFT.
73Shinder is not determinative of the issues in this case. It does not address the situation where, as here, all the assets in the NFT (save for the $100 to set up the trust) were a gift before marriage.
74The determination of whether Barbara’s interest in the NFT is to be included in the calculation of her net family property must therefore be considered afresh.
2. Barbara’s net family property value
75There is no dispute that:
(a) Before she was married, Barbara was the sole beneficial owner of the 702 shares in the BJL Trust that were worth $16 million at the time she married;
(b) The 702 shares in BJL Trust were a pre-marital gift from Barbara’s father;
(c) After Barbara and Ian were married and at Barbara’s father’s request, the NFT was created;
(d) Barbara’s father paid $100 to set up the NFT. That is the only money he contributed to the NFT;
(e) Thereafter, Barbara sold her 702 shares to 4MyKidz, a holding company;
(f) As sole Director and Officer of 4MyKidz, Barbara had complete control over 4MyKidz and could funnel all profits from the 702 shares to the NFT for eventual distribution to beneficiaries;
(g) Barbara was one of five equal beneficiaries of the NFT;
(h) As one of the three trustees of the NFT, Barbara was entitled to keep 100 percent of the distributions of 4MyKidz through the trust if she and her brothers agreed to distribute the proceeds that way. In fact, Barbara received over 90 percent of these distributions until the date of separation; and
(i) During the marriage, the common shares of 702 grew in value from approximately $16 million to $668.7 million.
76A pictorial representation of the situation before and after the estate freeze is set out below.
77Barbara’s father made her a valid gift before marriage by transferring the 702 shares to a trust in which Barbara was the sole beneficiary. This gift occurred before Barbara’s marriage. A pre-marital gift gives rise to a deduction – not an exclusion.
78The trial judge accepted the constraints on Barbara’s interest prior to marriage and her father’s continuing involvement. He found as fact that Barbara had a limited ability to sell, encumber, or dispose of the 702 shares for her sole benefit from 1993-2001. He found that Barbara was acting on her father’s intention in 2001, that the NFT be created to ensure that the future growth in value of the 90 Class B Common Shares of 702 Barbara legally owned, were passed on to Barbara and her issue. He also accepted that at the time she sold her shares to 4MK, there was no certainty that Barbara would receive distributions from the NFT when it was created. However, he also made a finding of fact that at that time she did know she would be a beneficiary of the NFT.
79He concluded, however, that, if he were not bound by Shinder, “even with these factual findings”, Barbara’s interest in the NFT at the date of separation was not a gift acquired from a third person after the date of marriage.
80As the trial judge held in his alternative analysis, at paras. 289-290:
Where Barb’s logic [in claiming an exclusion arising from a post-marital gift] fails is that [her father] did not divest himself of property and transfer it to Barb (or her children) [after Barbara was married], other than his $100 used to establish a trust as settlor.
[Her father] did not own Barb’s shares when the NFT was created. At most, [her father] was a donor of $100 in which Barb has a beneficial interest. Aside from his $100, his property did not form the subject of the enormous value of the trust. It was the growth value in Barb’s 90 Class B common shares of [702] that formed the subject of the trust, which Barb owned and sold to 4MK and which was then purchased by the NFT. Or put differently, the value of Barb’s beneficial interest in the NFT arose from her own shares. [Emphasis added.]
81Since the funds put into the estate freeze were all funds (that is, shares of 702) Barbara’s father gave her before marriage, which were then transferred to the NFT after her marriage to Ian, the only property Barbara’s father gave her after her marriage to Ian, was the $100 fee he paid to effect the estate freeze.
82The $100 from Barbara’s father was a de minimis contribution that does not change the facts of this case: the value of the NFT derives entirely from the 702 shares that Barbara beneficially owned at the date of the marriage. All parties understood this to be so. When Barbara sold her 702 shares to 4MyKidz, she was already the sole director and officer of 4MyKidz, and both a beneficiary and trustee of the NFT.
83Unlike Shinder, this was not a mixed-asset trust; Barbara knew that the only property in the NFT was 100 common shares in 4MyKidz, and she knew that 4MyKidz had no other assets than her 702 shares. Moreover, it is artificial to say that Barbara was “given” an indirect beneficial interest in the 702 shares after marriage. This is because when she sold the 702 shares to 4MyKidz, she was already a beneficiary of the NFT. She sold the 702 shares knowing she would retain a beneficial interest in their growth value.
84In these circumstances, Barbara’s father did not give Barbara new property after marriage that she did not already possess, nor did he divest himself of anything beyond $100. The 702 shares were not his to give. Characterizing Barbara’s entire interest in the NFT as a “gift after marriage” solely because the trust was initially seeded with $100 from her father would allow form to overwhelm function.
85I leave for future consideration of this court more complicated scenarios such as those involving mixed asset trusts, or where a spouse brings gifted property into marriage, divests herself of it for some length of time beyond what occurred in this case as a formal aspect of the estate freeze transaction, and is re-gifted the same traceable property at some later date. None of these occurred in this case. Barbara’s interest in the NFT was directly traceable to other “property” as defined under the Family Law Act that was already hers at the date of marriage.
86As such, only the inconsequential $100 amount is a gift after marriage that is excluded property under s. 4(2)1 of the Family Law Act.4
3. Conclusion: Barbara’s interest in the NFT is not a gift after marriage and should therefore not be excluded from her net family property
87For the above reasons, I conclude that Barbara’s share of the NFT on the date of separation was not a “gift” from a third party after marriage. This court’s decision in Shinder is distinguishable and not binding on the facts of this case. Barbara is entitled to a deduction for the value of her shares at the date of marriage, but her interest in the NFT is not excluded property under s. 4(2)1 of the Family Law Act.
88I would adopt the alternative analysis offered by the trial judge and include in Barbara’s net family property a one-fifth share of the NFT, minus the marriage-date deduction of $16 million. This is consistent with the case law.5 Moreover, for the reasons of the trial judge and consistent with the evidence of Barbara’s expert valuator, the reasons in LeVan, and Andrew Freedman & Timothy Martin, Financial Principles of Family Law, (Toronto: Thomson Reuters Canada, 2021), I would apply a 50 percent discount to Barbara’s 20 percent interest.
89Section 5(6) of the Family Law Act provides for discretion to award an unequal division if equalizing the net family property would be “unconscionable”. Appellate intervention on such an issue is limited: Ward v. Ward, 2012 ONCA 462, 111 O.R. (3d) 81, at paras. 35-36.
90I accept the trial judge’s conclusion that an equalization payment to Ian of $25,748,826.01 would be unconscionable given that: (1) Barbara received only 17 percent of the post-separation distributions when the NFT was reorganized in 2022, thereby reducing her net family property by over $11 million; (2) Barbara paid for a disproportionate share of the family debt; (3) Ian mismanaged the family finances in later years; (4) he engaged in some unconscionable behaviour as set out above; and (5) to do otherwise, would result in Ian having a higher net worth than Barbara.
91I do not accept Ian’s claim that the trustees of the NFT, that is, Barbara and her two brothers, acted in concert to advance her claim. The onus is on Ian to support such an assertion and no evidence was offered to support this: Genesis Land Development Corp. v. Smoothwater Capital Corporation, 2013 ABQB 509, 3 Alta. L.R. (6th) 197, at para. 24. Based on the evidence of Barbara’s two brothers, which the trial judge accepted, the trial judge held that Barbara has not and likely will not, act in concert with her two brothers to affect the CCL share price. Moreover, Barbara owes the NFT a fiduciary duty as a trustee, such that she cannot appropriate equity in 4MyKidz for herself.
92Nor do I accept the cases Ian cites to suggest that reducing the equalization payment would erode the Family Law Act objectives. The cases Ian relies on in so asserting are distinguishable. In those cases, there were only small appreciations of wealth and there were no findings of bad conduct as there are here: El Khatib v. Noun, 2023 ONSC 1667, at paras. 126-127; Koughan v. Dow, 2015 PECA 2, 365 Nfld. & P.E.I.R. 26, at para. 43; and Livermore v. Livermore (1992), , 43 R.F.L. (3d) 163 (Ont. Gen. Div.).
93Also distinguishable are the authorities Ian relies on to support his position that s. 5(6) cannot be used to sanction bad behaviour. In some of the cases he cites, the spouse accounted for her debts and in another, there was no evidence of extravagant lifestyle: McLean v. Dahl, 2017 ONSC 1288, 26 E.T.R. (4th) 96, at para. 263; Gibson v. Gibson, 2011 ONSC 4406, at paras. 384-413; and Crawford v. Crawford (1997), , 33 R.F.L. (4th) 381 (Ont. C.A.), at para. 14. As such, there is no basis to overturn the trial judge’s findings on this point: see also Serra v. Serra, 2009 ONCA 105, 93 O.R. (3d) 161, at paras. 60-67.
94The equalization payment should therefore be reduced to $18 million, in accordance with the trial judge’s alternative analysis, and it should be payable over eight years as the trial judge ordered, to reflect Barbara’s financial means.
d. Ian’s Spousal Support
95A spousal support order is entitled to significant deference: Hickey v. Hickey, , [1999] 2 S.C.R. 518, at para. 12. While spousal support guidelines are advisory, they do not presumptively apply to incomes that significantly exceed $350,000: Halliwell v. Halliwell, 2017 ONCA 349, 138 O.R. (3d) 671, at paras.106-7.
96The trial judge found that Ian had a needs-based entitlement to spousal support.
97He considered spousal support both on the theory that Shinder is controlling and Barbara’s interest is excluded from her net family property, and on his alternative analysis in which it is not. Investment income is the only source of these parties’ income.
98In the first scenario, Ian’s net worth for the purpose of generating investment income includes an equalization payment of $1.183 million. In the second, Ian is owed an $18 million equalization payment, reducing his need for support. The trial judge calculated spousal support in both scenarios.
99In this scenario, Ian receives an $18 million equalization payment in installments. The trial judge found that once Ian receives the initial $3.6 million in equalization, he will have sufficient resources for a home which is his most pressing need, and $8.5 million in prior capital. He will also receive $1.5 million in each of the following eight years. Need is not apparent.
100Under this scenario, the capital plus earned interest, should address Ian’s needs based on his budget of $480,000 annually. Under this scenario, the trial judge would not have granted prospective spousal support, but would have granted him retroactive support in the amount of $25,649 per month from August 1, 2019 to the date of the first equalization payment.
101I see no error in this approach.
e. Trial Costs Award
102Section 133(b) of the Courts of Justice Act, R.S.O. 1990, c. C.43, provides that leave is required where the appeal is only as to a discretionary costs order. However, when "the disposition on appeal changes the decision under appeal, leave to appeal from a costs order is not necessary": Climans v. Latner, 2020 ONCA 554, 152 O.R. (3d) 369, at para. 84; Tadayon v. Mohtashami, 2015 ONCA 777, 341 O.A.C. 153, at para. 70; see also Beaver v. Hill, 2018 ONCA 840, 143 O.R. (3d) 519, at para. 2, leave to appeal refused, [2019] S.C.C.A. No. 82.
103The trial judge ordered Ian to pay costs in the amount of $2.8 million. He did so based on the orders made, Ian’s behaviour before and during the trial, and the fact that Barbara was the relatively more successful party at trial and was thus presumptively entitled to costs.
104Both parties delivered multiple offers to settle before trial and during the trial proceedings. The trial judge found that had Ian accepted any of Barbara’s three pre-trial offers, he would have obtained a more favourable outcome than the outcome at trial. He specifically found that two of Barbara’s pre-trial offers to settle were rule 18 (now rule 24) offers under the Family Law Rules, O. Reg. 114/996. Her second offer was more than Ian received on the trial judge’s alternative analysis.
105As noted by the trial judge, Ian “refused to accept reasonable offers to settle, made none of his own until a few weeks before trial … spent excessively, and behaved poorly leading up to and during the trial”. The trial judge found that all of Barbara’s offers demonstrated a good faith effort to settle the case.
106The trial judge considered Ian’s argument that it was only in October and November of 2023 that Barbara took the position that, if her interest in the NFT was included in her net family property, a pro rata (20 percent) value should be ascribed to her, and a 50 percent minority/illiquidity discount should apply.
107Although the trial judge held that Barbara was entitled to full indemnity costs of $3,344,722 and that her request for $3 million in costs was appropriate, and this sum was $1 million less than Ian’s trial costs, he reduced the $3 million costs award sought by Barbara by $200,000 given the divided success of the parties at trial.
108Ian has achieved partial success on this appeal in that he is entitled to a larger equalization payment than the one he was awarded at trial.
109However, in the unique circumstances of this case, I would not make a more favourable costs award than the one ordered at trial.
110Barbara’s second pre-trial offer to settle exceeded what Ian would receive under the court’s alternative reasons, which I have adopted. The trial judge noted that had Ian accepted Barbara’s first pre-trial offer to settle, the net benefit to Ian would have been approximately $18.5 million, which roughly equals what Ian would have received under the trial judge’s alternative analysis (if $2.03 million in pre- and post-judgment interest, as calculated by Ian, was added). The trial judge found that Barbara’s second pre-trial offer was even better than the first. Had Ian accepted Barbara’s second offer to settle, he would have obtained a more favourable outcome than the outcome on this appeal.
111Furthermore, as the trial judge noted, Ian now 71, leaves the marriage with $26 million that is “a product of a gift from Gordon; it is not a product of the joint success of the parties during the marriage”. By operation of legislation intended to apply to very different circumstances, Ian is sharing in a gift never intended for him. Ian created significant debt for the family and spent money without Barbara’s consent.
112For the same reasons that the trial judge reduced the equalization payment otherwise owing as grossly unjust and shocking to the conscience of the court, I would not reduce the trial judge’s costs award.
IV. CONCLUSION
113For the above reasons, I would allow the appeal in part.
114Shinder is not determinative of the central issue in this case. Instead, I would accept the trial judge’s alternative analysis and conclusion that Barbara’s interest in the NFT was not a gift after marriage and should therefore be included in the assessment of her net family property, subject to a deduction for the marriage-date value of the CCL shares. The resulting equalization payment from Barbara to Ian is $18 million payable over eight years to reflect Barbara’s financial means. Ian is entitled to receive retroactive support in the amount of $25,649 per month from August 1, 2019 to the date of the first equalization payment but no spousal support thereafter. The appeal of the costs award is denied.
115The parties have agreed on costs of the appeal payable to Ian in the all-inclusive amount of $65,000.
Released: July 21, 2026 “K.M.v.R.”
“Thorburn J.A.” “I agree K. van Rensburg J.A.” “I agree. David M. Paciocco J.A.”
In Black v. Black (1988), , 66 O.R. (2d) 643 (H.C.), the husband’s father created two estate freezes by incorporating a holding company, to whom he sold his own shares, in exchange for voting preference shares. The husband did not claim the shares that his father sold to the holding company were a gift. Rather it was the potential “growth in value” of those shares from the completion of the estate freeze to the date of separation which he contended was a gift. Walsh J. concluded that because the husband contended the shares sold by the father to B Ltd. were not a gift, their increase in value must be included in NFP calculations as well.
This court’s decision in Reisman v. Reisman, 2014 ONCA 109, 118 O.R. (3d) 721, is distinguishable as this court permitted the exclusion of the Class D shares because: (a) the wife accepted that the Class D shares constituted a gift and the trial judge refused to permit her to withdraw that admission; and (b) the father gifted to the husband in separate transactions the Class D shares during the marriage, such that they were excluded.
Footnotes
- These statements do not apply to the matrimonial home, which is treated exceptionally under the Family Law Act.
- Fixed-value preferred shares are shares with a set par value – that is, a set price at which the company can buy the shares back. This effectively caps the price of the shares, unlike common shares which have no such limitation. Dividends for preferred shares are also fixed, usually as a percentage of par value. These are the relevant features of preferred shares for this case.
- The trial decision appears to refer only to the 48 shares owned by the husband and then held by the trust (para. 117). The statement that the Shinder trust comprised Sol’s property and Neil’s common shares may be factually inaccurate. It may, in fact, have been comprised only of Neil’s shares. However, as this court’s comment about “additional benefits” as excluded property was clearly premised on the assumption that the Shinder trust included both Sol’s and Neil’s property, the true nature of the trust in that case is of no legal import.
- The $100 is clearly a gift after marriage. It, along with its appreciation, is excluded from net family property. This amount is entirely inconsequential in the context of this multi-million-dollar dispute and so is appropriately omitted from the analysis.
- In Brinkos v. Brinkos (1989), , 69 O.R. (2d) 225, this court excluded gifts from the wife’s parents made to a trust during the marriage from net family property calculations.
- As noted by the trial judge, the Family Law Rules were amended on January 21, 2025, after the parties’ initial cost submissions were received but before their responding submissions. Rules 18 and 24, which deal with costs, were amended. Under the new Family Law Rules, the cost consequences of failing to accept a reasonable offer moved from r. 18(14) to r. 24(12), although the rule has not changed in substance.