Waye v. Cook, 2015 ONSC 7151

CITATION: Waye v. Cook, 2015 ONSC 7151

DIVISIONAL COURT FILE NO.: 313/15 DATE: 20151130

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

SWINTON, V. J. MACKINNON AND D. L. CORBETT JJ.

BETWEEN:

CYNTHIA WAYE Applicant (Appellant)

– and –

GEORGE RICHARD COOK Respondent (Respondent in Appeal)

Michael H. Tweyman, for the Applicant (Appellant) D. Smith, for the Respondent

HEARD at Toronto: November 17, 2015

REASONS FOR JUDGMENT

V. J. MACKINNON J.

[1] This is an appeal from the final order of Backhouse J. dated May 1, 2014 in which she ordered spousal support payable to the appellant in the amount of $2,200 per month commencing May 1, 2104 and arrears of $53,800 payable at the rate of $500 per month.

[2] The appellant submitted the trial judge made errors of law in imputing income to the appellant, in failing to fix spousal support in the mid to high end range of the Spousal Support Advisory Guidelines (“SSAG”), in fixing the commencement date for post application support, and with respect to her calculation of the respondent’s income for 2013 and 2014.

[3] Both parties sought leave to tender fresh or new evidence on the appeal.

[4] The parties had a long term marriage of 29 years. At the date of separation in 2003 the appellant was 54 years of age. The respondent was 55. The appellant commenced her Application for spousal support in August 2003. The respondent delivered an Answer, seeking a divorce and costs, and taking the position that no spousal support should be awarded. The appellant’s motion for temporary spousal support was brought in 2012.

[5] At the time of separation the respondent was no longer working. He had held various positions in high tech companies in Canada. In 1998 he obtained a position in Berlin, Germany. The appellant gave up her full time job of two years duration at the Art Gallery of Ontario to follow him to Berlin. She had been making $50,000 per year, but was unable to work in Berlin. The respondent had a significant income in Berlin. He also invested in the company he worked for. When he left the company he was bought out for about $12 million. However in her affidavit of evidence in chief the appellant noted that the respondent had lost about $8 million between 1999 and 2001 through mismanagement.

[6] In 2001 the parties moved to London, England, where the respondent was re-employed. The appellant was again unable to work in London. The respondent was dismissed in June 2002. By the time of the separation he considered himself as retired.

[7] After separation the parties divided a Trust between themselves. From this they each received in excess of one million dollars. In 1999 they had purchased a cottage in Muskoka for $1,950,000. Title to the cottage had been taken in the name of the Cook Cottage Trust. After separation the respondent sued their two children who were the trustees, and also beneficiaries of the Trust. The lawsuit was eventually settled on the basis that the respondent received $250,000. The appellant was entitled to an equivalent amount; however, it was offset against payments the Trust had made to carry the cottage while she had been residing in it.

[8] The parties also each received $27,750 in 2013 from the sale of a condominium in Kingston, Ontario.

[9] Although the respondent had not claimed an equalization payment in his Answer, he had done so when the motion for temporary support was brought. The trial judge found their son was the beneficial owner of the one remaining real property. Any imbalance in the division of jewellery, vehicles, boats, chattels and artwork was found to be de minimus. Accordingly no equalization payment was awarded.

[10] The respondent had come out of retirement in 2006 because, as he said, he had run out of money. The appellant learned in late 2011 that he was working. This information prompted her to seek temporary spousal support in 2012, but that motion was not actually heard until June 2013. No order was made because the respondent’s evidence was that he had lost his employment in January 2013 and was still not working. Despite that evidence, in fact the respondent had been interviewed for a position before the motion was heard and had actually signed a contract 2 days before the motion decision was released.

[11] The trial judge reviewed the role the appellant had played during cohabitation. She noted the appellant had only had full time employment for 5 of those years. She reviewed the appellant’s education history including her degrees in Humanities achieved during marriage. The trial judge also considered the appellant’s employment history and earnings since separation. She considered her current living circumstances and income which was $470 per month from CPP.

[12] The trial judge reviewed the comparative information for the respondent. In her reasons for decision the trial judge stated at paras [43],[44],and [46]:

[43] Both parties have depleted the significant assets they had accumulated at separation. The marriage was a long term marriage. Ms. Waye was economically disadvantaged as a result of leaving her career at the AGO to move to Berlin where Mr. Cook’s career took him. She was unable to work in Europe and England and Mr. Cook was content for her to remain out of the paid workforce. I accept that the opportunities for Ms. Waye to return to the workforce after separation were limited in her field and because she had been out of the workforce for so many years. Relative to Mr. Cook’s employment prospects, Ms. Waye has been economically disadvantaged by the responsibilities she undertook during the marriage. While Mr. Cook is in a volatile business where his positions are not typically long term, he has a lot of experience and a current position where he is earning $96,000/year. However, if Mr. Cook is expected to support Ms. Waye from employment income at age 66, it is also reasonable to expect that Ms. Waye could obtain some employment, albeit not likely in her field. This is particularly so where both parties have used up the significant assets which existed at separation and Mr. Cook’s tenure at his position is insecure. Accordingly, I attribute employment income to Ms. Waye of $25,000 which together with her income from CPP would make a total income of $30,000. The SSAG amounts for incomes of $96,000 and $30,000 range from a low of $2,062, mid-$2,406 and high-$2,684. In my view, the appropriate amount for support is $2,200/month subject to a material change in circumstances.

[44] With respect to Ms. Waye’s claim for retroactive support, in my view, the support should be retroactive to March, 2012. This appears to be the approximate time when Ms. Waye gave notice of her claim for temporary support. Mr. Cook had the means to support Ms. Waye at that time and had notice of her claim. I find it likely that at the time Ms. Cook’s temporary support motion was before Justice Stephenson, Mr. Cook knew of his imminent employment with Shift Energy and did not disclose it until after Justice Stephenson rendered her decision. I attribute income of $30,000/year to Ms. Waye in calculating retroactive support back to March, 2012 because I consider that either she was more involved in August Moon and Arctic Moon than she has let on or she could have worked more than she did.

[46] … In my view to award support retroactive to 2003 would not be appropriate for the following reasons:

(a) Mr. Cook was not employed until 2006. If it was Ms. Waye’s view that Mr. Cook was intentionally unemployed to defeat her spousal support claim or was required to work to support her, this should have been litigated at the time.

(b) Although Ms. Waye claimed support in her application issued in 2003, she did not do anything to pursue this until 2012. Ms. Waye relies on an affidavit of Mr. Cook sworn September 9, 2003 in which he stated that he was retired. There is no evidence that that was not true at that time. She also relies on evidence he gave at his examination for discovery in the CCT litigation that he was retired. Ms. Waye’s testimony was that she was not involved in the CCT litigation. There is no evidence that Ms. Waye disclosed to Mr. Cook at the time the curating work for the 2 museums that she got or her work at Arctic Moon. It seems more likely that she was content for her own reasons not to pursue a claim for temporary support during this time.

(c) Mr. Cook has no significant assets from which to pay a retroactive support award going back to 2003.

[13] An appeal court may not interfere with a trial judge’s findings of fact or determination of issues based upon the exercise of discretion unless there was a significant misapprehension of the evidence or the decision is clearly wrong in principle. Specifically with respect to support orders deference is accorded the trial judge unless there is an error of law or the award falls outside of what is considered to be a reasonable range of outcomes. See Marinangeli v. Marinangeli, 2003 27673 (ON CA), [2003] O.J. No. 2819 (C.A.); Brophy v. Brophy, 2004 25419 (ON CA), [2004] O.J. No. 17 (C.A.); Juvatopolos v. Juvatopolos, 2005 35677 (ON CA), [2005] O.J. No. 4181 (C.A.).

[14] I will now turn to the grounds for appeal. The trial judge decided to impute employment income to the appellant. I do not accept the submission that the trial judge did so by drawing an equivalency between the parties in respect of their ability to earn income on the basis of age alone. Rather, in my view the trial judge’s finding that it is reasonable to expect the appellant to find some employment, even though she was 65 years of age, reflects the appellant’s continuing obligation to contribute in a reasonable way to her own support. The trial judge was well aware of the differences in the parties’ employment histories and earning abilities. She found that seeking employment at that age was reasonable in the circumstances here where the parties had both depleted their assets and the support payer’s employment was insecure.

[15] Contrary to the appellant’s submission there was an evidentiary record to support a finding that the appellant could find suitable employment, and upon which to base an imputation of $25,000 annual income. The trial judge noted in para [21] that the appellant had obtained some work in her field after separation. She had obtained a federal research grant in 2003, and was hired twice on a part time basis to install exhibitions in two museums. The appellant had earned $51,276 in 2007 and $16,164 in 2008. She had also assisted her daughter, Ashley, in a retail operation. At paragraph [21] the trial judge noted:

She curated exhibitions of local artists at “Arctic Moon”, part of the property rented by Ashley who operated a retail clothing store, “August Moon”, in Port Carling, Ontario and the plan was that Ms. Waye would make commissions on any sales of art which was on consignment. The sales were not enough to cover the expenses and she received no remuneration. Arctic Moon closed in 2010 after 2 summers. She helped her daughter out at August Moon when she needed another pair of hands but did not receive compensation. She asked Ashley to produce her corporate records at Mr. Cook’s request but Ashley refused. August Moon closed in 2013.

[16] It is clear in para [44] that the trial judge drew an adverse inference about the extent to which the appellant had been truthful in this aspect of her testimony.

[17] The determination of the appellant’s income and the decision to impute income to her based on employment history and capacity is a discretionary decision, entitled to deference. On the facts as found by the trial judge there is no basis to interfere with her exercise of discretion.

[18] The trial judge was asked to commence the award of spousal support from the date of commencement of the application in 2003. On appeal the appellant seeks a commencement date of January 2008. In deciding that spousal support should commence in March 2012 the trial judge referred to several factors. These included the commencement date of the litigation in 2003, the timing of bringing the motion for temporary support in 2012, the passage of time since the separation (by time of trial 11 years), the respondent’s lack of employment in 2003 to 2006, the lack of assets from which a support award retroactive to 2003 could be made, and the appellant’s own earnings post separation. The trial judge referred to the parties’ expenditures by which they had depleted their substantial assets in various places in her reasons.

[19] The trial judge specifically addressed the appellant’s submission that she had not actively pursued her spousal support claim because the respondent had held himself out as being retired and because his income was always a moving target. The trial judge made two specific findings demonstrating she rejected this submission. At para [46] the trial judge found that “she [the appellant] was content for her own reasons not to pursue a claim for temporary support during this time.” At the same paragraph she also found that had the appellant regarded the respondent as intentionally unemployed during his period of retirement she could have litigated that issue then.

[20] The appellant submits the trial judge erred by not having regard to all of the factors set out in Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269. At paragraph [212] of Kerr the Court stated:

[212] other relevant considerations noted in D.B.S. include the conduct of the payor, the circumstances of the child (or in the case of spousal support, the spouse seeking support), and any hardship occasioned by the award. The focus of concern about conduct must be on conduct broadly relevant to the support obligation, for example, concealing assets or failing to make appropriate disclosure: D.B.S., at para. 106. Consideration of the circumstances of the spouse seeking support, by analogy to the D.B.S. analysis, will relate to the needs of the spouse both at the time the support should have been paid and at present. The comments of Bastarache J. at para. 113 of D.B.S. may be easily adapted to the situation of the spouse seeking support: "A [spouse] who underwent hardship in the past may be compensated for this unfortunate circumstance through a retroactive award. On the other hand, the argument for retroactive [spousal] support will be less convincing where the [spouse] already enjoyed all the advantages (s)he would have received [from that support]". As for hardship, there is the risk that a retroactive award will not be fashioned having regard to what the payor can currently afford and may disrupt the payor's ability to manage his or her finances. However, it is also critical to note that this Court in D.B.S. emphasized the need for flexibility and a holistic view of each matter on its own merits; the same flexibility is appropriate when dealing with "retroactive" spousal support.

[21] In my view the trial judge did consider these factors. She turned her mind to the reality that while the support award here was a post application award, nonetheless the passage of so much time meant that an order reaching right back to the commencement date was akin to a retroactive award, with the difficulties that entailed for the respondent. Unlike the facts in Kerr, the appellant here had not pursued her claim promptly, for stated reasons with which the trial judge did not agree.

[22] The appellant also submits that by selecting March 2012 as the commencement date for post application support the trial judge failed to have regard to the litigation conduct of the respondent in not voluntarily providing financial disclosure to her when he came out of retirement in 2006 and from time to time as his income changed.

[23] In the circumstances here, where the case started in 2003, was defended, and then no steps were taken for so many years, the appellant cannot ground such an obligation simply upon the existence of the litigation. The facts here are distinguishable from Marinangeli where the Court of Appeal agreed that it was open to the trial judge to have implied a term into a contract that the payor had a duty to disclose material changes of circumstances having regard to his pre-settlement representations and the almost immediate significant improvement in his financial position following the signing of the contract. This does not assist the appellant.

[24] It is clear that the respondent misled the motion court in 2013. The trial judge made this finding. Her decision to commence the post application support prior to that date addresses that misconduct.

[25] The appellant submits that the trial judge erred in fixing spousal support at the midpoint between the low end and the middle of the SSAG range. Her submission is that as she had a strong compensatory claim, it was error not to award an amount in the higher end of the range The trial judge referred to the compensatory aspects of the appellant’s claim. She finds the appellant was economically disadvantaged by leaving her career to move to Berlin and by the responsibilities she undertook during the marriage. The trial judge was alive to the compensatory aspects of the appellant’s spousal support claim. She also knew that both spouses were over age 65 and had virtually no assets. She was not obliged as a matter of law to award support in the higher end of the range.

[26] Nor would I give effect to the appellant’s submission that the trial judge failed to provide sufficient explanation for her award that was $25 per month below the low end of the range for 9 months in 2012. First, it appears that the trial judge was rounding her numbers. Second, elsewhere in her reasons she notes that in 2012 the respondent had some non-recurring income from a collapsed RRSP. In the context of the reasons in their entirety an award that was $25 per month below the low end of the range for a period of months is not a reviewable error.

[27] The trial judge found the respondent’s income to be $75,000 in 2013 and $96,000 in 2014. With respect to 2013 the appellant’s submission is that having referred to it in paragraph [27] of her reasons, the trial judge either failed to include the respondent’s severance pay in the total, or that she allowed him unproven business deductions. The respondent testified that he had business expenses of approximately $2,000 per month. He was not cross examined on this issue. During submissions the appellant’s trial counsel agreed with the trial judge that the respondent would be entitled to have his business expenses deducted.

[28] The appellant’s motion to introduce fresh or new evidence on the appeal was with a view to providing this Court with the respondent’s income tax return for 2013, which had not been filed at the time of trial. The total income figure reported in it is not materially different from that accepted by the trial judge.

[29] I would not allow the new evidence. It would not make a conclusive impact on an issue in the appeal. Nor would I be prepared to accept the 2013 return and then adjust the total income figure upwards based on submissions from appellant’s counsel with respect to the propriety of the business expenses claimed in the return.

[30] The purpose of tendering the 2014 income tax return was to establish that the trial judge had erred in not including the respondent’s CPP income for that year. This appears to have been the case. Nonetheless, in my view a matter of this nature should not form the basis of an appeal. The better approach is to return the issue to the trial judge for consideration as a slip or omission prior to entering the final order. This is all the more so where as here the trial judge knew the respondent was in receipt of CPP and did include it in his income for 2014.

[31] The 2014 income tax return does not meet the test for fresh evidence on an appeal. Rather it is more aptly described as “new” evidence that would more appropriately form the subject of a motion to change. Parenthetically, such a motion is already before the Superior Court of Justice.

[32] I need not address the respondent’s new evidence, which was filed in response to the appellant’s fresh evidence motion.

[33] For these reason the appeal is dismissed.

[34] Counsel requested the opportunity to make written submissions on the issue of costs. If they are unable to agree on costs, their brief submissions should be delivered to the Divisional Court Office on or before December 31, 2015.

___________________________ V. J. MACKINNON J.

SWINTON J.

D. L. CORBETT J.

Released: November 30, 2015

CITATION: Waye v. Cook, 2015 ONSC 7151

DIVISIONAL COURT FILE NO.: 313/15 DATE: 20151130

ONTARIO SUPERIOR COURT OF JUSTICE DIVISIONAL COURT

SWINTON, V. J. MACKINNON AND D. L. CORBETT JJ.

BETWEEN:

CYNTHIA WAYE Applicant (Appellant)

– and –

GEORGE RICHARD COOK Respondent (Respondent in Appeal)

REASONS FOR JUDGMENT

V.J. Mackinnon J.

Released: November 30, 2015