Court File and Parties

CITATION: Vainshtein v. Vainshtein, 2016 ONSC 3697 DIVISIONAL COURT FILE NO.: 078/16 COURT FILE NO.: FS-15-401891 DATE: 2016-06-06

SUPERIOR COURT OF JUSTICE – ONTARIO DIVISIONAL COURT

RE: Tzahi Elichai Vainshtein, Applicant/Moving Party AND: Limor Vainshtein, Respondent/Responding Party

BEFORE: Thorburn J.

COUNSEL: Vincenzo Ruso, for the Applicant/Moving Party Jonathan Miller, for the Respondent/Responding Party

HEARD: In writing

Endorsement

Overview

[1] The Applicant, Tzahi Vainshtein, seeks leave to appeal the Order of Hood J. On January 27, 2016, Hood J. imputed income of $75,000 to the Applicant and ordered him to pay an increased sum for child and spousal support.

[2] The Applicant claims that Hood J. imputed income to him without regard to any documentary evidence of either the Applicant or the Respondent’s financial situation.

The Evidence

[3] The Parties were married for three and one half years and have one child who was born on February 9, 2013.

[4] At the hearing, the Applicant reported a sworn annual income of approximately $46,538. The Respondent reported a sworn annual income of $27,279.

[5] On January 27, 2016, Hood J. made an interim Order that the Applicant pay child support in the amount of $682 per month and spousal support in the amount of $471 per month. Both sums are based on an imputed income of $75,000.

[6] His reasons for so doing are as follows:

[6] RW [Respondent Wife] argues that the AH’s [Appellant Husband] employment income from his business, of which he is a 50% shareholder, is grossly understated in light of his apparent lifestyle, including a trip to the Dominican Republic for a week with Levy and large monthly entertainment and restaurant expenses as disclosed on his Visa statements. As well, he has an ownership interest in three investment properties, he lives with his parents in their home, and his debt load has decreased since separation despite his claimed expenses and payments to the RW. In addition, the RW questions his expenses and argues it is suspicious that his monthly expenses for himself are more, by $1,736 than for herself and Levy, or alternatively his expenses are double of hers. Part of that of course consists of his monthly payment for child support at $430. (Emphasis added)

[7] Both parties argue that on a motion such as this for interim child and spousal support I should look to the eight factors as set out by Justice Lemon in Driscoll v. Driscoll, 2009 ONSC 66373. Both parties acknowledge that I am not to embark upon an in-depth analysis of the parties’ circumstances, which is better left to trial. I am to achieve rough justice at best. The AH argues however, that no prima facie case for entitlement has been made out so that no interim support should be ordered above the voluntary payment of $430 in child support.

[8] I find that a prima facie case for support has been made out. The RW has demonstrated need despite her job. I believe that the AH has the means to make support payments so as to allow the RW to live at a standard not equivalent to what she experienced prior to separation but above the situation she presently finds herself in.

[9] As to the AH’s means, I have considered the fact he is self-employed, lives with his parents, has not increased his debt since separation, voluntarily paid $2,000 per month for four months, has allegedly paid approximately $25,000 since separation to the RW, and based upon his admitted payments of insurance and daycare over and above his child support payments has a table income of $67,600. (Emphasis added)

[10] For the purposes of this motion I am prepared to impute a total income of $75,000 from both his rental properties and his business, which results in a monthly child support payment of $682 and an approximate mid-point monthly spousal support payment of $471. I am not prepared to order that the AH continue to pay the monthly insurance for the car of $153 as was belatedly argued by the RW during the argument before me. This was not asked for in the Notice of Motion and it would be unfair to the AH to make an order in relation to it when it was not asked for. The AH may continue to make such payment on a without prejudice basis if so inclined.

[11] I note that this is the third court attendance in less than one year. During argument I was advised that the parties are awaiting a valuation of the AH’s business. Once this is done I would expect the parties to arrange a settlement conference in the hopes of resolving this matter in its entirety.

Test for Leave to Appeal

[7] The test for leave to appeal is a strict one. Rule 62.02(4)(a) provides two bases upon which leave may be granted.

[8] Under the first branch of the test, the moving party must establish that there is a conflicting decision of another judge and it is, in the opinion of the judge hearing the motion, “desirable that leave to appeal be granted.” A “conflicting decision” must be with respect to a matter of principle, not merely a situation in which a different result was reached in respect of particular facts: Comtrade Petroleum Inc. v. 490300 Ontario Ltd. (1992), 7 O.R. (3d) 542 (Div. Ct.).

[9] Under the second branch of the test set out in Rule 62.02(4)(b), the moving party must establish that there is reason to doubt the correctness of the order and the proposed appeal involves matters of such importance that leave to appeal should be granted. It is not necessary that the judge granting leave be satisfied that the decision in question was actually wrong – that aspect of the test is satisfied if the judge granting leave finds that the correctness of the order is open to “very serious debate”: Nazari v. OTIP/RAEO Insurance Co., [2003] O.J. No. 3442 (S.C.); Ash v. Lloyd’s Corp. (1992), 8 O.R. (3d) 282 (Gen. Div.). In addition, the moving party must demonstrate matters of importance that go beyond the interests of the parties and involve questions of general or public importance relevant to the development of the law and administration of justice: Rankin v. McLeod, Young, Weir Ltd. (1986), 57 O.R. (2d) 569 (H.C.); Greslik v. Ontario Legal Aid Plan (1988), 65 O.R. (2d) 110 (Div. Ct.).

Issues Raised

[10] The Moving Party claims there are a number of conflicting decisions that suggest that documentary evidence should be reviewed before imputing income, and clarification of this point of law is a matter of general importance.

[11] In the alternative, he claims there is good reason to doubt the correctness of the Order and the proposed appeal involves matters of general importance such that leave to appeal should be granted.

Analysis and Conclusion

[12] Section 19 of the Child Support Guidelines, O. Reg. 391/97 enacted pursuant to the Family Law Act, R.S.O. 1990, c. F.3 provides that the court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the “intentional under-employment or unemployment, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse”.

[13] In Robles v. Kuhn, 2009 BCSC 1163, [2009] B.C.J. No. 1699, the court articulated eight principles to be applied when considering interim support motions:

i. on applications for interim support the applicant's needs and the respondent's ability to pay assume greater significance;

ii. an interim support order should be sufficient to allow the applicant to continue living at the same standard of living enjoyed prior to separation if the payor's ability to pay warrants it;

iii. on interim support applications the court does not embark on an in-depth analysis of the parties' circumstances which is better left to trial. The court achieves rough justice at best;

iv. the courts should not unduly emphasize any one of the statutory considerations above others;

v. on interim applications the need to achieve economic self-sufficiency is often of less significance;

vi. interim support should be ordered within the range suggested by the Spousal Support Advisory Guidelines unless exceptional circumstances indicate otherwise;

vii. interim support should only be ordered where it can be said a prima facie case for entitlement has been made out;

viii. where there is a need to resolve contested issues of fact, especially those connected with a threshold issue, such as entitlement, it becomes less advisable to order interim support.

[14] The motions judge provided reasons for his decision to impute income.

[15] He noted that on this motion for interim support, he was not to embark on an in-depth analysis of the parties' circumstances which is better left to trial.

[16] He made reference to factors such as the Applicant’s lifestyle, expenses and the fact that his debt load had decreased since the time of separation.

[17] He did not however, specifically refer to any documentary evidence to support the request for imputed income.

[18] The Applicant has not met the high threshold for leave to appeal for the following reasons:

a. this is an interim not a final order (the third in one year, according to the motions judge);

b. there is no exhaustive list of factors that must be considered when imputing income (Bak v. Dobell, 2007 ONCA at para. 34);

c. a party’s lifestyle has been found to be relevant to the issue of imputing income. It is evidence from which an inference may be drawn that the payor has undisclosed income that may be imputed for the purpose of determining child support. (Bak v Dobell (supra) at paras. 41 and 43);

d. the motions judge was entitled to draw the inference that he did; and

e. there is no issue of public importance such that leave to appeal should be granted.

[19] For these reasons, the motion for leave to appeal is denied.

[20] The Responding Party seeks full indemnity costs in the amount of $2,179.77 on the basis that the Applicant acted in bad faith in bringing this Application and the amount in issue does not justify the legal costs incurred.

[21] I have considered the factors set out in Boucher v. Public Accountants Council (Ontario) (2004), 71 O.R. (3d) 291 (C.A.), including the reasonable expectations of the parties, the material filed, the complexity of the matter and importance of this matter to the parties. The materials filed by the parties were sparse. While the Applicant was unsuccessful, I do not agree that he acted in bad faith.

[22] I award costs in the amount of $2,000 to the Respondent.

Thorburn J.

Date: June 6, 2016