Court Information
Ontario Court of Justice 47 Sheppard Avenue East Toronto, Ontario M2N 5N1
Parties
Between: Mumena Tabihzada, Applicant (mother)
And: Ahmed Nasir, Respondent (father)
Before: Justice Robert J. Spence
Heard on: 27 March, 10 April and 7 June 2013
Reasons for Judgment released on: 24 June 2013
Counsel
Ms. Zahra Khedri and Ms. Saira Nathoo — for the Applicant, mother
Mr. Reginald M. McLean — for the Respondent, father
Nature of the Case
1This is a Motion to Change brought pursuant to Subrule 15(5) of the Family Law Rules wherein the mother seeks child support for the seven year old child of the relationship. The order sought to be changed is dated June 21, 2006, whereby the mother was granted sole custody, with no access to the father. In that order, the father was not required to pay any child support.
2Both parents are currently in receipt of social assistance. However, the mother argues that income should be imputed to the father in the amount of $40,000 per year. The father agrees that it would be reasonable to impute income to him, but argues that it should be not more than minimum wage, currently about $21,300 per year.
3The mother seeks child support in accordance with the "table" amount as provided for in the Child Support Guidelines ("Guidelines"), as well as special or extraordinary expenses pursuant to section 7 of the Guidelines. The father argues that whatever amount is imputed to him, he ought to pay only the table amount, and nothing toward section 7 expenses.
4Accordingly, the two issues for this court to decide are, first, how much income to impute to the father and, second, whether any section 7 support ought to be ordered.
Background
5Both parents were born in Afghanistan, where they were married in 2003. The mother emigrated to Canada shortly after the marriage. In 2004, she sponsored the father to come to Canada. Father arrived later that same year. They separated in 2005, either just before or just after the birth of their child.
6The child suffered a stroke in the perinatal period, resulting in her current condition, known as hemiplegic cerebral palsy. Some of her rehabilitation needs are being met at the Holland Bloorview Child Development Program. However, there are certain therapies which she would benefit from and which are not available through that Program and which would have to be paid for privately. These include bi-weekly sessions of:
- Physiotherapy and occupational therapy, at a cost of $110 per hour;
- Speech therapy at a cost of $130 per hour; and
- Massage therapy at a cost of about $100 per hour.
7Mother, understandably, would like to offer each of these to her child, twice per month, at a total cost of about $680 monthly. There is no question that the child is severely disabled and the father acknowledges that these treatments are in the child's best interests. From his perspective however, he argues that he simply has no ability to contribute to those extraordinary expenses.
8Although the mother was cross-examined to some extent on her ability to earn an income, father's counsel did not press this point and he did not pursue it in his closing submissions.
9Father's formal education in Afghanistan was limited, reaching only about grade 10. When father came to Canada in 2004 he began almost immediately to obtain gainful employment in the construction industry. His English language skills were poor-to-non-existent and he does not appear to have had any formal training in construction while he was in Afghanistan. Nevertheless, after arriving in Canada, he worked in the construction industry fairly regularly, initially as a labourer. Following that, he obtained a job in 2006 or 2007 doing kitchen installations.
10By 2008 he was employed at a reasonably successful level, so that his line 150 income on his 2008 income tax return disclosed income of $43,276. However, he says that he lost the job he had in 2008 when the business partnership which employed him broke apart; and from that point forward, father decided to work as a self-employed individual in the "construction" business.
11In the first year he was self-employed, father's gross income on his income tax return was $8,194. He said that his gross income was very low for 2009 as he worked for just a few months in that year. He described himself as a "carpenter".
12However, he appears to have had faith in his capacity to utilize his skills, so that in 2009 he paid $1,300 for a 3-year commitment to a full-page advertisement in the local Afghani newspaper. The display ad refers to himself as "Nasir Builders", and shows pictures of a kitchen, hardwood flooring, doors and windows, trimming and framing. The display advertises that he is able to do "ALL Your Home Contracting Needs" [father's emphasis]. Notwithstanding the fact that he says his business eventually closed down in August 2012, this advertisement continues to run in the newspaper, as recently as the March 2013 edition. In response, father says that he doesn't care that the advertisement is running because he is not paying for it and the telephone number that appears in the display is no longer his telephone number. Instead, he says he gave this number away to a friend who, in turn, gave the number to his friend's sister.
13Following 2008, father's income tax documents and bank statements reveal the following:
- 2009 – gross business income $8,194; no expenses shown
- 2010 – gross business income $25,161; net income $6,181. His bank deposits for 2010 totalled $46,378.
- 2011 – gross business income $29,921; net income $12,153. His bank deposits for 2011 totalled $59,628.
14He has either not filed or failed to disclose his income tax return for 2012. A letter dated August 23, 2012 from "Nash Carpentry Inc." ("Nash") states that father was employed by Nash since January 2012 as a "part-time employee" and was paid $4,926 between January 2012 and the date of the letter. Father testified he received no monies from Nash after August 23, 2012. He also either states explicitly or implies that he and Nash have no direct connection, and are at arm's length with one another.
15He stated that his gainful employment ceased in December 2012 and, since January 2013 he has been in receipt of social assistance in the amount of $505 per month.
16Father filed a letter from "Working Women Community Centre" dated March 25, 2013, which states that he is attending at the Centre for English as a Second Language ("ESL") classes on Monday, Tuesday and Thursday each week, from 6 - 9 p.m. He testified that he will have greater employment opportunities if he is able to improve his English language skills.
17In addition, he testified that he continues to search for employment during the day, seeking any kind of work that corresponds to his skills. However, he provided no details regarding any of these job searches, including names of places he has contacted, dates of those contacts, names of persons he spoke to, or the specific jobs for which he has applied.
Imputing Income – The Law
18Section 19 of the Guidelines provides:
Imputing income
- (1) The court may impute such amount of income to a parent or spouse as it considers appropriate in the circumstances, which circumstances include,
(a) the parent or spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of any child or by the reasonable educational or health needs of the parent or spouse;
(b) the parent or spouse is exempt from paying federal or provincial income tax;
(c) the parent or spouse lives in a country that has effective rates of income tax that are significantly lower than those in Canada;
(d) it appears that income has been diverted which would affect the level of child support to be determined under these guidelines;
(e) the parent's or spouse's property is not reasonably utilized to generate income;
(f) the parent or spouse has failed to provide income information when under a legal obligation to do so;
(g) the parent or spouse unreasonably deducts expenses from income;
(h) the parent or spouse derives a significant portion of income from dividends, capital gains or other sources that are taxed at a lower rate than employment or business income or that are exempt from tax; and
(i) the parent or spouse is a beneficiary under a trust and is or will be in receipt of income or other benefits from the trust. O. Reg. 391/97, s. 19 (1) ; O. Reg. 446/01, s. 6.
19The leading case in Ontario on imputing income is Drygala v. Pauli. In that case, the Court of Appeal stated, at paragraph 32 [my emphasis]:
[32] Imputing income is one method by which the court gives effect to the joint and ongoing obligation of parents to support their children. In order to meet this legal obligation, a parent must earn what he or she is capable of earning.
20And, at paragraphs 45 and 46, the court continued [my emphasis]:
[45] When imputing income based on intentional under-employment or unemployment, a court must consider what is reasonable in the circumstances. The factors to be considered have been stated in a number of cases as age, education, experience, skills and health of the parent. See, for example, Hanson, supra, and Cholodniuk v. Sears 2001 SKQB 97 , (2001), 14 R.F.L. (5th) 9 (Sask. Q.B.). I accept those factors as appropriate and relevant considerations and would add such matters as the availability of job opportunities, the number of hours that could be worked in light of the parent's overall obligations including educational demands and the hourly rate that the parent could reasonably be expected to obtain.
[46] When imputing income, the court must consider the amount that can be earned if a person is working to capacity while pursuing a reasonable educational objective. How is a court to decide that when, typically, there is little information provided on what the parent could earn by way of part-time or summer employment? If the parent does not provide the court with adequate information on the types of jobs available, the hourly rates for such jobs and the number of hours that could be worked, the court can consider the parent's previous earning history and impute an appropriate percentage thereof.
Analysis of the Evidence
21On cross-examination, father was asked whether, as the earlier-mentioned ad suggests, he is a skilled carpenter. Father's response was evasive, stating simply that he did not have a licence. However, that ad, which the father himself placed in the newspaper, combined with the actual work experience father has disclosed, reveals to the court that he has a broad range of skills, including skills as a carpenter.
22The non-existence of a licence is not an answer to the question father was asked. The court is able to take judicial notice that there are many highly skilled persons who work as carpenters, and in other construction-related trades, who do not necessarily possess licences in those trades. Many of these people have come from other countries, and by dint of their own efforts they have learned their skills on the job. In the circumstances of this case and, particularly given father's several years of work in the construction industry in Canada – from 2004 to 2012 (he says), I conclude on a balance of probabilities that he has the skills which enable him to perform this kind of work.
Father's Credibility
23The court's determination of whether father is maximizing his income-earning capacity, as required by Drygala, is very much tied to father's overall credibility, something with which I had considerable difficulty. I do not intend to set out all the various evidentiary areas where father's credibility suffered, but I will highlight a few of the more significant areas.
1. The Advertisement
The advertisement which I referred to earlier, for which father paid $1,300, is still running today, even though father says he stopped doing any work in 2012. He claims that he has no connection whatsoever to Nash, other than having done some part-time work for Nash, as noted earlier. Why then did he give his phone number to the person who runs Nash, if he and Nash are at arms-length to one another? How does it make sense that he would continue to allow an ad to run in a paper that specifically gives his name as the person who performs all of the described types of work? And why is it that father paid $1,300 for the ad to run for three years in 2009, and the ad is still running today, into the fourth year. Someone must be paying for the extension of that ad beyond the three-year period. While there may be facts which satisfactorily answer these questions, the father certainly did not provide them during his testimony.
2. The Telephone Number
Furthermore, the telephone number in the ad is a number that the father claims has not been his number for more than one year. And yet at paragraph 2 of the parties' Statement of Agreed Facts, dated March 27, 2013, filed at the outset of this trial, the father acknowledges this phone number is in fact registered under his name. When this was pointed out to the father during testimony, he attempted to resile from the truth of that Agreed Fact.
3. Job Applications
The father testified he became unemployed in August 2012 (when he stopped working for Nash). On November 1, 2012, as part of the requested disclosure, I ordered the father to produce a detailed list of all jobs he had applied for since becoming unemployed. He provided no such list and, at trial, stated simply that he applied for jobs "on the computer". When he was asked for proof, he replied "You can go and check the site and the dates and my name".
He was shown a list of approximately 17 carpentry jobs posted on the Government of Canada "Explore Careers – Job Market Report" website, that were advertised during the months of January, February and March 2013, and he was asked for proof that he had applied for any of these jobs. His response was that it was his "friend's" responsibility to apply for jobs on his behalf, and if his friend did not do so "it's not my fault".
4. ESL Classes
He was asked why he felt it was necessary to enrol in an ESL course for the first time, in January 2013, after having lived in Canada for nine years previously, and after having worked in the construction industry for a number of years, with a demonstrated ability as far back as 2008 to earn an income of more than $43,000. His response was to deny that this was in fact his income, even though that amount comes directly from his own tax return for 2008. I accept that father, like many others whose native tongue is not English may be able to benefit from ESL classes; but the classes which father is enrolled in run for a total of 9 hours per week, in the evenings only, and father has given no explanation of how he spends his daytime hours and why, after years of experience in the construction industry in the GTA, he is incapable of earning an income in that general field.
5. Bank Deposits vs. Declared Income
He was asked to explain the discrepancy between his bank deposits of $59,628 in 2011 as compared to his declared gross business income in the amount of $29,921 for the same year. His response was that he received money from his family, but he provided no details or any corroborative evidence that would account for that discrepancy of almost $30,000.
6. Bank Account Statements
By court order dated June 20, 2012, father was ordered to produce his statements for all of his bank accounts. Although he stated at trial that he has had two bank accounts over the past three years, he actually produced statements for only one account.
7. Lump Sum Visa Payments
He claimed to have earned only $12,153 during 2011 and yet during the months of September and October 2011, he made three lump sum cash payments on his Visa Card, totalling $10,000. He was asked how he managed to do this when his income was barely at a subsistence level. The following were his responses:
a. "I don't know where I got this money; I need time to think about it".
b. "I have lots of friends so maybe I leant money to my friends and they returned this money to me".
c. "Maybe I asked my customers to pay me in cash".
8. Cash Payments
He was then specifically asked whether he was being paid in cash for jobs he was doing, and whether he was failing to disclose these cash payments. In the context of the foregoing response, at #7 above, he was forced to admit that this was in fact the case.
24There were other instances in father's testimony where his credibility was seriously called into doubt, but given the foregoing, I find it unnecessary to list any further examples.
25The net result of all of this is that father clearly has construction trades skills, and he has demonstrated an ability to employ these skills in the past, but is failing to do so at the present time. And that failure is not in spite of sustained and good faith efforts on his part to find gainful employment. Instead, I am forced to conclude one of two things: Either he is making little or no effort at all to be gainfully employed or he is in fact working for cash and simply failing to disclose that income, as he has admittedly done in the past.
26It matters little to the court which of the two is in fact the case. It is sufficient to state that in either case, father has failed to demonstrate to the court that he has maximized his income-earning capacity, as required by the Court of Appeal in Drygala.
How Much Income to Impute?
27As I noted at the outset of these reasons, mother seeks an imputation of $40,000, whereas father argues that the imputation should be at minimum wage, namely, $21,300.
28In the case of Trottier v. Prud'homme, 2012 ONCJ 641, Justice Lawrence Klein stated, at paragraph 13 [my emphasis]:
The Court received evidence as to how to impute income to the Applicant. Statistics Canada provided CANSIM table 281-003 (Exhibit #3) setting out average hourly earnings for persons in the construction trades with an average hourly rate of $25.20 or $48,384 annual income based on a 40 hour work week and 48 weeks worked. The Financial Services Commission of Ontario in its 2007 Residual earnings Capacity Wage Table (Exhibit #4) listed carpenters as earning $56,194 annually. Finally, Statistics Canada Employment Earnings and Hours – June 2012 Table 4 – 7 which is an estimate of average weekly earnings in various industries in Ontario showed construction of buildings with a weekly wage of $1,132 or $54,336 annually based on a 40 hour work week and 48 week year. All of these estimates are reliable and have been accepted by courts in Ontario at all levels.
29Similarly, in this case, mother's counsel submitted Statistics Canada Estimates of employment and average weekly earnings for "construction of buildings", disclosing an average wage of $1,051 per week, as at July 2012. She also filed Statistics Canada Table 281-0030 Average earnings for employees paid by the hour in constructions, with rates ranging from $21.59 in 2007 to $28.35 in 2011. And she filed Table 281-0029 showing average wage in Canada in the construction industry, in the amount of $29.89 per hour.
30No objection was taken to any of these filings, and I accept them as admissible evidence, as did Justice Klein in Trottier. By extrapolating these various hourly amounts, I arrive at an annual income of well in excess of $50,000 per year. That said, I appreciate that for many of these workers in the construction industry, licences might well be required, particularly for work on large-scale projects. Nevertheless, even if I discount those numbers by 20% I still arrive at $40,000 per year, the amount submitted by mother's counsel. Furthermore, I find such an amount to be the minimum that father is capable of earning, given that at least a portion of such earnings would be in undeclared cash and hence, income on which he would be paying no taxes. Accordingly, I have no hesitation in finding that income should be imputed to father in the amount of $40,000 per year.
Section 7 Expenses
31Section 7 of the Guidelines provides [my emphasis]:
Special or extraordinary expenses
- (1) In an order for the support of a child, the court may, on the request of either parent or spouse or of an applicant under section 33 of the Act, provide for an amount to cover all or any portion of the following expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child's best interests and the reasonableness of the expense in relation to the means of the parents or spouses and those of the child and to the spending pattern of the parents or spouses in respect of the child during cohabitation:
(c) health-related expenses that exceed insurance reimbursement by at least $100 annually, including orthodontic treatment, professional counselling provided by a psychologist, social worker, psychiatrist or any other person, physiotherapy, occupational therapy, speech therapy, prescription drugs, hearing aids, glasses and contact lenses;
32Father's counsel submitted the case of Ward v. Ward (1999), 44 R.F.L. (4th) 340, a decision of Justice Quinn. At paragraph 28, Justice Quinn had the following to say in respect of section 7 expenses [my emphasis]:
In determining whether a non-custodial parent should pay "add on" support . . . I think three questions should be asked, and in this order:
Is the expense necessary in the sense that it is the best interests of the child that it be incurred?
Is the expense reasonable, having regard to the means of the parents and those of the child and to the spending pattern of the parents in respect of the child during cohabitation?
Does the non-custodial parent have the ability to pay a pro rata share of the expense (or, failing that, any share)?
An answer of "No" to any one of the above questions is sufficient, in my view, to end any consideration of ordering support under s. 7(1)(a) [of the Guidelines].
33Having regard to the wording of section 7 of the Guidelines, I agree with Justice Quinn's three-step approach.
34Father's counsel fairly acknowledges that the answer to the first question is "Yes". And because the parties did not cohabit during the life of the child, the second question is not applicable. However, counsel argues that the answer to the third question is "No" and, accordingly, that should be sufficient for the court to make no order for section 7 support.
35I agree with that submission. It is regrettable that this child has so many life challenges, that the cost of extra therapy for those deficits is so high, and that little of that cost is covered by government health care. However, even at an income of $40,000 per year, once father pays the Guideline table support of $360 per month in after-tax dollars, he is left with only relatively modest financial resources. Compounding this will be the fact that the order I am making will result in immediate arrears of support owing by father in excess of $6,000.
Conclusion
36For the reasons set out herein, I make the following order:
Father shall pay mother $360 per month in support, for one child, based on his imputed income in the amount of $40,000 per year, support to commence, February 1, 2012, being the month that this Motion to Change was commenced.
I fix the arrears of support in the amount of $6,120 as at June 30, 2013. The arrears of support are to be paid by father in the amount of $200 per month commencing July 1, 2013, for a total monthly payment by father of $560, until the arrears are paid in full.
Mother's claim for section 7 support is dismissed on a without prejudice basis.
37In the event mother seeks costs arising from this decision she is at liberty to file submissions, not to exceed two pages in length, excluding any Bill of Costs, Offers to Settle and authorities, which shall be filed no later than July 19, 2013. Father's reply submissions, also not to exceed two pages in length, with the same exclusions, shall be filed no later than August 2, 2013.
38I thank counsel for the organized and effective manner in which they presented their respective cases.
Justice Robert J. Spence
June 24, 2013
Footnotes
1Mother's income-earning capacity which, on the evidence is clearly limited, would not impact on the table support payable by the father under the Guidelines. However, if mother were capable of earning a meaningful income, that fact would impact on her ability to contribute toward the claimed section 7 expenses for the child.
2I use the word "construction" in the broadest sense to include jobs such as painting, flooring, drywall and carpentry, whether residential or commercial.
3Apart from his bare statement that he has applied for jobs on the computer.
4I describe them as "cash" payments because there is no record of these amounts having been withdrawn from his bank account.
5Insofar as the imputation of income is concerned, although, as I point out later in these reasons, if he were in fact earning a meaningful income, this would impact on his ability to contribute to the section 7 expenses for the child.
6Given father's admitted historical pattern of working for cash and not declaring that cash income on his tax return.
7I would be inclined to take a different view of this, if I were satisfied on a balance of probabilities that the father in fact had an income of $40,000 per year, or more, and that a significant portion of this income was in cash. In such an eventuality, his income would be grossed-up for child support purposes, thus leaving him with a greater disposable income from which he would be able to contribute toward section 7 expenses.
8Calculated as follows: 17 months (from February 1, 2012 to June 30, 2013) x $360 per month.