Court File and Parties

Court File No.: FC-13-370 Date: 2016/04/18 Ontario Superior Court of Justice

Between: Kristina Pey, Applicant – and – Ali Javaheri Pey, Respondent

Counsel: Carol Craig, for the Applicant Self-Represented for the Respondent

Heard: January 26-29, 2016 (at Ottawa)

Reasons for Judgment

Shelston J.

Overview

1The parties met in November 2007 in Ottawa. Both were employed full-time, had no children and owned their own homes.

2The parties moved in together in November 2008.

3In May 2009, the parties found out that the applicant was pregnant.

4On August 15, 2009, the respondent proposed to the applicant.

5The parties married on September 26, 2009.

6The parties jointly purchased 772 Fletcher Avenue on October 17, 2009, which became their matrimonial home.

7Their first child, Anya, was born on February 3, 2010.

8The second child, Parisa, was born on May 29, 2011.

9The parties separated on October 16, 2012.

10Legal proceedings were commenced by the applicant on February 14, 2013.

11On September 25, 2015, at a settlement conference, the parties settled the issues of custody and access with respect to their two children by minutes of settlement. Said minutes were confirmed by judgment of Justice Doyle dated September 25, 2015.

12The remaining issues between the parties were:

(a) a divorce; (b) imputation of income to each party; (c) spousal support including quantum, duration and retroactivity to May 1, 2013; (d) quantum of child support as of October 15, 2015; (e) life insurance for child and spousal support; (f) medical and extended health coverage for the children; (g) equalization of the net family property; (h) post separation credits; (i) prejudgment interest; and (j) costs.

History of the Parties’ Relationship

13When the parties met, the applicant was 32 years of age and the respondent was 35 years of age.

14The applicant was employed as an import-export clerk earning approximately $43,000 per year with Zarlink Semiconductors Inc.

15The respondent was employed in the computer industry earning approximately $70,000 per year with the company known as Protus.

16Both parties owned their own homes with the applicant owning a home on Grassy Plains Drive, Ottawa, Ontario and the respondent owning a home on Clyde Avenue, Ottawa, Ontario.

17In November 2008, the parties decided to move in together at the applicant’s home. The respondent rented out his home on Clyde Avenue.

18From the beginning this was a difficult relationship. The respondent was a very controlling individual who dominated the applicant and threatened to end their relationship on numerous occasions.

19The degree of control exercised by the respondent included making the applicant feel uncomfortable when talking on the phone with friends, or arguing about the type of books she read. If the respondent did not like the book that the applicant was reading, he would throw it in the garbage. He belittled her for wearing bikini bathing suits while she played beach volleyball.

20At times, the respondent could be positive, but at other times he was very difficult and angry. This type of behaviour was corroborated by the evidence of Eva Koerner, the applicant’s sister, regarding an incident when they attended at her home in Northern Ireland.

21The issue of sex was a constant source of friction between the parties. The respondent insisted on having sex seven days a week with the applicant. If the applicant rebuffed these requests, the respondent would give her the “silent treatment”.

22The respondent would become angry if the applicant met male friends at work or after a recreational soccer game. He would interrupt the applicant if she was on the phone with her best friend.

23In May 2009, the applicant discovered that she was pregnant with the respondent’s child. However, the relationship difficulties continued.

24When the applicant was two months pregnant, during an argument when the applicant told the respondent that she was agnostic, the respondent became angry and pushed her. She fell to the ground on her right side with such force that she felt sore and stressed.

25If the respondent was upset with the applicant, he normally resorted to screaming at her.

26In early August 2009, both parties felt that the relationship was over. The respondent told the applicant he was breaking up and the applicant, trying to save the relationship, proposed that the parties attend counselling and that they not discuss religion. The respondent agreed.

27On August 15, 2009 during a camping trip, the respondent proposed to the applicant and she accepted. The parties agreed on a wedding date of September 26, 2009.

28One evening in late August 2009, the applicant alleges that the respondent punched the applicant in the head because he was upset that she was reading in bed while he tried to sleep. The applicant had bruising on the side of her face and missed two days of work. The respondent left the home but returned the next day and the parties continued their relationship.

29The respondent denies the allegation and provided a series of emails written on August 17, 18, 19, 20, 21, 24, 25, and 31, and on September 2, to show that the parties were in love, were preparing for the wedding, were discussing things as an engaged couple and that these emails fundamentally contradict the evidence of the applicant.

30Regarding the allegation of punching the applicant in the face, the respondent’s version is that the parties were going to counselling every week until the week before the marriage. The respondent does admit that there was an altercation where he did push the applicant with his hand in the back. She got up from the bed and left the room and then 10 seconds later came back in the room, jumped on him in the bed and attacked him. The call was made to the police, who asked him to leave. He went to a hotel and returned the next day.

31However, the applicant’s evidence is that there were missing emails from August 26 to August 30. Further she produced as Exhibit 70 a text message from the respondent to the applicant dated August 28, 2009 where the applicant indicates to the respondent that she feels scared and states:

I’m just nervous it will happen again to tell you the truth, I don’t know what I want to do but I feel very scared right now. Can you tell me what you want to do.

32The respondent’s evidence regarding the parties’ relationship is that the parties had cultural differences and that they had multiple breakups.

33Despite the difficulties in the relationship, the applicant went ahead and married the respondent on September 26, 2009. Her rationale was that she decided to go ahead with the marriage because everything had been booked; invitations had been sent and people were coming in from out of town.

34After the marriage, the situation did not improve. One occasion, on the day that she was to convert to Islam, at the request of the respondent, the applicant had second doubts. She raised her concerns with the respondent who screamed at her. In response, the applicant went ahead and converted to Islam.

35The first child Anya was born on February 3, 2010.

36The plan was that the applicant would remain on maternity leave until February 2011. The respondent was working and earning a substantial salary.

37Unfortunately, after the birth of Anya, the relationship continued to suffer significant problems. For example:

(a) The respondent criticized the applicant for not properly feeding the child. (b) On Father’s Day 2010, when the child was crying the respondent took the child away from the applicant and refused to give the child back to the applicant. An argument ensued and the respondent put his hand over the applicant’s mouth and kicked her. The respondent took the child upstairs. The parties continued to argue and inadvertently the child’s head hit the wall. The respondent pushed the applicant with such force as to make an imprint into the wall. Police were called but no charges resulted. (c) In the fall of 2010, the parties were arguing again. The respondent threw a book that the applicant was reading down on the floor and poured water on the books. He then took the books outside. In retaliation, the applicant took the respondent’s parents’ Koran and submerged it in a sink full of water. She then threw it into the backyard. The respondent ran out to retrieve the Koran. The respondent never forgave the applicant for this conduct.

38In September 2010, the parties became aware that the applicant was pregnant with a second child. Despite the stress in the relationship, the applicant testified that she wanted another child because she felt Anya was going to have a hard life and wanted to give her a sibling to be with her.

39By the fall of 2010, the applicant testified that the relationship was not good. The respondent was not talking to her.

40The applicant’s maternity leave ended in February 2011. The second child, Parisa, was born on May 29, 2011. The applicant returned to work for a couple of months to qualify for another round of maternity leave with the second child. In May 2012, the applicant’s maternity leave ended. She was terminated from her position with a Zarlink Semiconductors Inc. and has not worked since that time.

41Despite the birth of the child, the respondent did not talk to the applicant for one-and-one-half months. He did not talk to her when she went to the hospital. When the respondent brought the applicant home from the hospital, the silent treatment continued.

42After Parisa’s birth, the situation in the home was very tense between the parties.

43In August 2011, when Parisa was three months old, another incident occurred where, during an argument between the parties over the applicant reading in bed while the respondent was trying to fall asleep, he kicked her out of the bed. She got back into the bed and he kicked her again. She got back into the bed and he kicked her a third time. This time she jumped back in the bed and the parties fought. He flipped her on her back, put his knee on her chest and started to push her head into the bed. When the applicant was released, she called the police and the respondent was removed. No charges were laid. He came back the next day and the applicant continued to have discomfort in her ribs for three weeks.

44By September 2012, the situation was very difficult. The applicant testified that every day the respondent would call her a bitch, an asshole, evil, anorexic, and self-righteous. In front of the children, the respondent would say that she was terrorizing the children. He criticized her care of the children. He interfered with her childcare by not letting her put the children to bed or bathe them. The applicant further alleges that the respondent mistreated her dog and cats.

45Finally, by the middle of October 2012, the parties agreed that the relationship was at an end.

Separation

46At the time of the separation, the parties and the children were residing at 772 Fletcher Circle, Kanata, Ontario.

47The applicant’s original plan was that she would move out of the matrimonial home and take the children with her. However, the respondent refused to allow her to leave with the children unless there was an agreement that both parties would have equal time with the children.

48Consequently, the parties remained in the matrimonial home together. The respondent continued to pay the mortgage and the monthly bills. The applicant had no sources of income and the respondent cut her off from all finances.

49The applicant used her savings and her MasterCard to pay for her expenses which were mainly food and gas for her vehicle. The applicant requested money from the respondent but he refused to give her any money. The most he would do was pay an amount of her MasterCard bill that he determined was appropriate.

50The respondent alleges that the parties entered into a verbal agreement to have a two-two-three schedule of custody for the children with the applicant remaining in the matrimonial home. He alleges that the applicant reneged on the agreement and commenced litigation in February 2013. The applicant denied any such agreement.

51In December 2012, the respondent started threatening the applicant that he would quit his job to be home with the children.

52Both parties retained lawyers and were attempting to move forward in resolving the outstanding issues.

53The parties were unable to negotiate a settlement and proceedings were commenced.

54The respondent went on stress leave in March 2013 for three months and returned to work at the end of May 2013.

55The parties attended before Justice McLean for a motion for temporary relief on April 26, 2013. At that time the court ordered that:

1. The parties shall share time with the children. The father shall have the children, namely, Anya Pey, born February 3, 2010 and Parisa Pey, born May 29, 2011, in his care every weekend from Friday at 10 a.m. to Sunday at 4 p.m. commencing May 3, 2013.
2. The balance of the time the children shall be in the mother’s care.
3. The children shall remain in Ottawa save for trips to the mother’s relatives in Guelph. The mother shall give the father at least 24 hours’ notice of any such trips.
4. Commencing May 1, 2013, the father shall pay to the mother child support in the amount of $1,538 per month and spousal support of $1,488 per month pursuant to an income of $110,000.
5. On consent and on a without prejudice basis, Christina Pey shall have exclusive possession of the matrimonial home located at 772 Fletcher Circle, Ottawa, Ontario, pending sale.
6. The balance of the issues are adjourned to a date to be set by the trial coordinator after questioning.
7. Costs reserved to the trial judge.

56Based on the parties reaching an agreement on temporary relief, the respondent vacated the matrimonial home and moved to his rental property on Clyde Avenue.

57The applicant and the children remained in the matrimonial home until it sold at which time the parties each received $118,000, representing half of the net proceeds of sale. The applicant has used her share towards legal fees and school expenses.

Imputation of Income

Respondent’s Work History and Plan

58The respondent was born in Iran. He graduated in 1994 with an Electronics Engineering degree from university where he was the class valedictorian. He moved to Canada in 2000 and settled in Belleville, Ontario. From October 2000 to May 2004 he was employed with Nortel. He was laid off and remained in Belleville until December 2004.

59He moved to Ottawa in January 2005 to work with TalkSwitch where he worked until November 2008. The respondent was laid off in November 2008 and was unemployed until April 2009 when he was hired by Protus. That company was purchased by J2 Global in March 2011.

60In August 2015, the applicant advised the respondent that she was going to be attending the University of Ottawa in the first year of a two-year program to obtain a Bachelor of Education.

61In August 2015, while attending a convention in Chicago, the respondent met a representative from Digital Aroma. The respondent had discussions with a representative of the corporation including a supper where they discussed possible employment opportunities.

62On August 21, 2015, the respondent was offered a job by Digital Aroma which paid him $65 an hour for a 37.5 hour work week. On August 22, 2015, the respondent signed the employment contract with Digital Aroma and gave J2 Global two weeks’ notice by email terminating his employment as of September 4, 2015.

63The respondent worked for Digital Aroma for two-and-one-half weeks, then, the day after the first settlement conference on September 22, 2015, he received an email from his employer on September 23, 2015 terminating his employment. Even though the contract provided for 15 days’ notice prior to termination, the respondent admits that he never received 15 days’ notice and only received payment for his services in October 2015.

64He is not been employed since September 23, 2015 and is currently receiving employment insurance benefits.

65His income history is as follows:

2009 – $70,145 2010 – $110,529 2011 – $127,325 2012 – $142,839 2013 – $117,229 2014 – $134,829 2015 – $119,502

66Since the order Justice McLean, the respondent had his children every Friday at 10 a.m. to Sunday at 4 p.m. because he could work from home on Fridays. However, corporate policy changed in August 2014 preventing employees from working from home. This change in policy was one of the major factors why the respondent said he looked for alternative employment.

67The parties were proceeding to a settlement conference on September 22, 2015. Prior to the settlement conference the respondent indicated that he had changed positions and was no longer working with J2 Global, but had taken a contract position with another company. The applicant was shocked.

68At the time the respondent resigned in August 2015, custody, access, child support, spousal support and all other issues remained unresolved with a settlement conference scheduled for September 22, 2015 and a trial to start the last week of September 2015.

69On September 22, 2015 the parties attended a settlement conference. The conference was adjourned to September 25, 2015 to see if they could resolve the custody issue. On September 23, 2015, the respondent was terminated from his contract position with Digital Aroma.

70On the return of the settlement conference on September 25, 2015, respondent stated that he settled the custody issue because he had no savings, no job and owing his counsel $23,000. The party signed minutes of settlement that day that were confirmed by final order of Justice Doyle dated September 25, 2015.

71The respondent has not complied with the child and spousal support obligations in the order of Justice McLean and has paid the following amounts:

(a) October 2015, the sum of $1,834 (b) November 2015, the sum of $1,800 (c) December 2015, the sum of $1,800 (d) January 2016, the sum of $1,800

72The respondent alleges that he did not want to burn bridges so he did not seek any relief against Digital Aroma. He received a cheque for $2,652(USD) on October 10, 2015.

Applicant’s Work History and Plan

73The applicant was employed with Zarlink Semiconductors Inc. from 2001 until May 2012. The applicant’s history of income from 2009 has been as follows:

2009 – $43,812 2010 – $32,168 2011 – $36,885 2012 – $40,429 2013 – $11,905 2014 – $23,023 2015 – spousal support

74In the winter of 2004, the applicant was a part-time student at Carleton University pursuing a Bachelor of Arts degree in English with a minor in History. She pursued that degree and graduated in May 2014.

75In September 2014, she started a Masters’ Degree in English with the hope that she could obtain a teaching job. However, she stopped pursuing that degree and applied at the University of Ottawa to start in the teachers’ program. She was accepted in the two-year program commencing September 2015 with an expected graduation date in May 2017.

76Her evidence is she is doing extremely well at school and that the first year ends on April 28, 2016. She plans to return in September 2016 to graduate the following spring.

77The applicant seeks to be self-sufficient and able to take care of her children. She anticipates a salary between $90,000 and $95,000 within 10 years. Her evidence is she would make more as a teacher than she did in her previous employment.

78Upon graduation, if there were no full-time positions available, the applicant could work as a supply teacher and then to work on long term occasional teaching for a year, which would then qualify her for board employment. While awaiting a position with the Board, she could always be hired in a private school.

79Her evidence is that teaching is her passion. The applicant further indicates that a starting salary as a teacher is approximately $55,000 a year and that she can work as a supply teacher earning $220 a day, which may increase.

80With respect to the possibility of working part-time while pursuing her degree, the applicant indicates that the course is very intensive and has a heavy workload. Adding her childcare responsibilities makes her ability to work part-time unrealistic. Her current marks are an “A” average.

The Law

81Section 19 of the Federal Child Support Guidelines, S.O.R./97-175, as am. [“Guidelines”] provides:

19. 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.

82Both parties are asking the court to impute an income to the other party based on the applicant or respondent’s intentional under-employment or unemployment (s. 19(1)(a)).

83The Court of Appeal in Drygala v. Pauli (2002), 61 O.R. (3d) 771 (C.A.), at para. 23, set out a three-part test for determining whether income should be imputed on the basis of intentional under-employment or unemployment as follows:

1. Is the spouse intentionally under-employed or unemployed?
2. If so, is the intentional under-employment or unemployment required by virtue of his reasonable educational needs?
3. If the answer to question #2 is negative, what income is appropriately imputed in the circumstances?

84Though the Court in Drygala dealt with imputing income for the purposes of child support, this test is equally applicable to claims for spousal support as determined in Crowe v. McIntyre, 2014 ONSC 7106.

1) Is the spouse intentionally under-employed or unemployed?

85A spouse is intentionally underemployed if he or she chooses to earn less than he or she is capable of earning having regard to all of the circumstances (Drygala, at para. 28). There is no requirement that the under-employment or unemployment be undertaken in bad faith or with the intention of avoiding support payments (Drygala, at paras. 29-36).

86The onus is on the party seeking to impute income to establish an evidentiary basis that the other party is intentionally under-employed or unemployed (Homsi v. Zaya, 2009 ONCA 322, 65 R.F.L. (6th) 17, at para. 28).

87When considering the spouse’s capacity to earn income, the court should consider, among others, the following principles:

(a) There is a duty on the spouse to “actively seek out reasonable employment opportunities that will maximize their income potential so as to meet the needs of their children” (Thompson v. Thompson, 2014 ONSC 5500, at para. 99); (b) A spouse’s capacity to earn income can be influenced by his or her age, education, health, work history, and the availability of work that is within the scope of his or her capabilities (Marquez v. Zaipola, 2013 BCCA 433, 344 B.C.A.C. 133, at para. 37); (c) A spouse can be found intentionally under-employed or unemployed if he or she quits employment for selfish or bad faith reasons, or engages in reckless behaviour that results in a reduction of his or her income earning capacity (Scott v. Chenier, 2015 ONSC 7866, at para. 48); (d) A spouse cannot avoid support obligations by a self-imposed reduction in income (Le Page v. Porter (2002), 7 R.F.L. (5th) 335 (Ont. S.C.), at para. 27); (e) Where a spouse experiences an involuntary loss of employment, courts will grant a “grace period” to allow the spouse to seek out replacement work. However, the absence of a reasonable job search will leave the court with no choice but to find that the spouse is intentionally under-employed or unemployed (Filippetto v. Timpano).

2) Is the intentional under-employment or unemployment reasonable?

88The second step of the Drygala test is generally treated as an overall test of reasonableness. In Jackson v. Mayerle, 2016 ONSC 72, at para. 702, the court held that:

Once intentional underemployment is established, the onus shifts to the payor to show one of the exceptions of reasonableness.

89Not all career decisions which result in reduced income will be unreasonable. However, when an employment decision leads to a significant reduction in child support, it must be justified in a compelling way as set out in the Court of Appeal decision Riel v. Holland (2003), 61 O.R. (3d) 417, at para. 23.

90In Thompson v. Gilchrist, 2012 ONSC 4137, 27 R.F.L. (7th) 83, at para. 35, the court held that a spouse must demonstrate that the decision was “reasoned, thoughtful and highly practical”

91Justice Pazaratz notes in Jackson v. Mayerle, at para. 715:

Parents are required to act responsibly when making financial decisions that may affect the level of child support available. They must not arrange their financial affairs so as to prefer their own interests over those of their children.

3) What income is properly imputed?

92Where the spouse is intentionally and unreasonably under-employed or unemployed, the court has a large range of discretion to impute as income an amount founded on a rational basis, as detailed in the Court of Appeal case of D.D. v. H.D., 2015 ONCA 409, 335 O.A.C. 376.

93The main factors a court should consider are the age, education, skills, and health of the spouse, along with the number of hours that can be worked in light of competing obligations and the hourly rate the spouse could reasonably obtain (Drygala, at para. 45).

94A factor to take into consideration in arriving at an amount of income to be imputed is evidence of a spouse’s previous income as was done by the Court of Appeal decision of Lawson v. Lawson (2006), 81 O.R. (3d) 321, at para. 38.

Imputation of Income to the Respondent

95I find that the respondent did not act reasonably in voluntarily resigning from his employment with J2 Global. Further, I find that he intentionally quit a well-paying secure job to avoid paying the child and spousal support being requested by the applicant. Finally, I do not find that the respondent has conducted a reasonable job search since he received his notice of termination from Digital Aroma.

96In arriving at this decision I have considered the various factors set out herein. Firstly, the income that the respondent has earned at J2 Global has been consistent and significant. In the years 2012, 2013 and 2014 the respondent earned significant income at his employment with J2 Global. In 2012 he earned $142,839; in 2013 he earned $117,229 and in 2014 he earned $134,829.

97Secondly, the timing of the decision to resign from a well-paying job is important in my analysis. Approximately one month before the commencement of the trial, the respondent leaves an employer with whom he has been working since 2009 to work for a company that he has very little knowledge of or work history with.

98I find that the actions of the respondent were reckless considering his obligations to pay child and spousal support. The respondent gave up his position with J2 Global to work for Digital Aroma based on one dinner in Chicago with a contact person whom he met at the trade conference. He had supper the first week of August and by August 20 he had spoken to his contact maybe two times before an offer was made on August 21. The respondent admitted that he did not take the contract to a lawyer and did not read it, but signed it on August 22, 2015. He admitted during the trial that the first time he knew that there was a 15 day notice period was during his testimony when it was pointed out to him by counsel for the applicant.

99Thirdly, the respondent had in the past threatened the applicant that he would quit his job. In December 2012, the respondent threatened the applicant that he would quit his job to stay home with the children. At that time the applicant was represented by Mr. Cecil Lyon who wrote to the respondent’s then counsel, Ms. Karla Policelli on January 10, 2013 filed as Exhibit 39. In that letter, Mr. Lyon dealt with threat by the respondent that he going to quit his job. Mr. Lyon stated in the third paragraph the following:

Please inform your client that in the event he does quit his job or orchestrates a dismissal then Ms. Pey will have no alternative but to have his current income imputed to him.

100Fourthly, the corporate decision to prevent employees from working off-site made in August 2014 was never imposed against the respondent. In cross-examination, the respondent admitted that from September 2014 to August 2015 he had his children every Friday and was never required to go to work and that his direct supervisor was aware of his circumstances. This contradicts the respondent’s evidence in chief where he indicated that one of the main reasons he quit was because his employer could not accommodate the flexibility in his work schedule. The reality is that his employer accommodated him for over a year. There was no evidence that his job was at risk or that his flexibility was being altered going forward.

101Further, as part of the process in the custody assessment by Dr. Weinberger, the respondent admitted that during an interview in the fall 2014 he never advised Dr. Weinberger that he could no longer work from home on Fridays as a result of a new company policy. It is clear to me the reason he did not is because the policy was not being applied to him by his direct supervisor. Consequently, this alleged reason to change employment is simply not valid.

102Fifthly, the respondent stated that one of the major reasons he changed employment was because his job was not stable as there were layoffs all the time in the computer industry. Specifically, of the eight employees in his group, by September 2015 the number of employees was down to two. He testified that in the last two years there were no new projects and in 2015 he received no bonuses. He admits though, that he loved his job. He indicated that when he quit he offered to work as a contractor for the company if it needed help, but they indicated they had replaced him. The respondent admitted that his job was never at risk.

103The respondent testified that while he apparently got up every day and looked for work but that he had not obtained employment. The respondent provided a list of places where he has made applications as well as providing emails regarding the four locations where he had an interview. The respondent’s position to the court is that he has been working every day to find a job through October and November, but that in December, because of the Christmas holidays and Christmas parties; it is normally a slow time to find employment. For the month of January, he has effectively been focusing on the trial, but he anticipates that he will find work soon.

104I do not believe that the respondent has actively sought employment. He has indicated that if the applicant has to spend her savings and he has to go into debt as a result of him not having full-time employment to pay child and spousal support, it is a short-term problem.

105The burden of proof is on the respondent to provide evidence that he is actively seeking employment. The evidence does not convince me that the respondent is doing everything possible to seek any employment.

106Further, I find that the respondent is attempted to mislead the court. The respondent failed to file an updated financial statement at the trial. He attended on January 28, 2016 with a financial statement that he filed in this proceeding. He testified that the information in his financial statement was correct however in cross-examination he admitted that he had failed to disclose a mutual fund with TD in the amount of $64,116.29.

107The respondent was aware that there were claims of custody, child support and spousal support to be adjudicated in September 2015 unless the parties settled the case. The respondent’s own evidence is that he could not afford to finance a custody trial and consequently he settled the claims for custody and access which were incorporated into the final order of Justice Doyle dated September 25, 2015.

108The respondent’s employment history shows that in the years 2012, 2013 and 2014, the three-year average of his income would be $131,362.33 per year. Even in the year 2015, the respondent earned $119,502.

109The applicant seeks to impute an income to the respondent of $110,000. Based on the totality of the evidence, I find that to be a reasonable and fair amount to impute as income to the respondent.

Credibility

110I find that the respondent is not a credible witness. When there is a dispute between the evidence of the applicant and the respondent, I prefer the evidence of the applicant.

111I accept the applicant’s evidence over the respondent regarding the incident in late August 2009. She answered the questions directly and was clear about her recollection.

112The respondent was evasive in his responses during cross-examination on this issue.

113Further, I find that the respondent attempted the mislead court regarding the applicability of the new corporate policy in August 2014 and its application to him.

114Finally, the respondent filed a financial statement that was incorrect in that it failed to include a mutual fund valued at $64,116.29.

Imputation of Income to Applicant

115The respondent seeks to impute an income to the applicant of $45,000 per year and says that since she has no teaching experience that she should go back to working in the import-export field which she did from 2001 to 2012.

116The evidence is that the applicant has not been employed since May 2012, that she is pursuing a full-time course of education with expected graduation in April 2017 and is the main caregiver of the two children of the marriage.

117I find that the applicant’s plan is reasonable in her circumstances. I decline to impute any income to the applicant.

Child Support

Table Child Support

118The applicant seeks child support of $1,654 per month for the months of October, November and December 2015, based on the respondent’s income of $119,502 in 2015.

119The order of Justice Doyle dated September 25, 2015, deals with child support up to and including September 2015.

120The evidence is that the respondent earned at least $119,502 in 2015. Based on that finding, I order the respondent to pay to the applicant table child support of $1,654 per month for each of the months of October, November and December 2015.

121For the year 2016, the respondent argues that his income is $27,000 and that he should pay table child support of $397 per month for both children. The applicant argues that the court should impute income of $110,000 to the respondent which translates into table child support of $1,538 per month.

122Based on the children residing primarily with the applicant, and the respondent having an imputed income of $110,000, I order the respondent to pay table child support to the applicant in the amount of $1,538 per month commencing January 1, 2016.

Recalculation of Child Support Arrears

123Pursuant to paragraph 18 of the order of Justice Doyle dated September 25, 2015, the respondent agreed to retroactively adjust his child support based on his actual 2013 and 2014 incomes. Consequently the respondent agreed that he owed from May 1, 2013 to September 2015 the total of $7,336 in retroactive child support.

124At the trial, the respondent verbally requested a variation of the child support arrears in paragraph 18 of the final order of Justice Doyle dated September 25, 2015. The applicant is opposed to any variation.

125The respondent admits that he had counsel advising him at the time of the settlement on September 25, 2015. I find that there is no evidence to support a finding that a material change in circumstance has occurred to provide the evidentiary basis to vary paragraph 18 of the order of Justice Doyle dated September 25, 2015.

126As such, I dismiss the respondent’s variation of the child support arrears.

Spousal Support

127The applicant seeks spousal support. During his testimony the respondent indicated that the applicant was not entitled to spousal support or that if she was it should be limited to five years. In final submissions, both parties agreed that the applicant is entitled to spousal support. They disagree on the commencement date, the quantum and duration of said support.

128This court has jurisdiction to order spousal support under s. 15.2 of the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.). This section sets out the relevant factors the court must consider, as well as the objectives of a spousal support order:

Factors

(4) In making an order under subsection (1) or an interim order under subsection (2), the court shall take into consideration the condition, means, needs and other circumstances of each spouse, including

(a) the length of time the spouses cohabited; (b) the functions performed by each spouse during cohabitation; and (c) any order, agreement or arrangement relating to support of either spouse.

Spousal misconduct

(5) In making an order under subsection (1) or an interim order under subsection (2), the court shall not take into consideration any misconduct of a spouse in relation to the marriage.

Objectives of spousal support order

(6) An order made under subsection (1) or an interim order under subsection (2) that provides for the support of a spouse should

(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown; (b) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage; (c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and (d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.

129The applicant’s position is that she should receive spousal support in the mid-range of the Spousal Support Advisory Guidelines (SSAG) with a review eight months after her anticipated graduation from teachers college in the spring of 2017. Further, she requests that the spousal support be adjusted retroactively to May 2013 based on the applicant’s actual income.

130The respondent’s position is that he is prepared to pay spousal support from October 2012 to October 2017. Proceedings were commenced in 2013. The separation was in 2012.

131The applicant argues that she is entitled to spousal support based on the compensatory and non-compensatory factors of the Divorce Act. In considering all the evidence, I agree that she is entitled to receive spousal support based on both factors.

132The applicant had two children with one born in 2010 and another in 2011. She was and remains the primary caregiver of the children. She decided to become a teacher as it would provide a better career path for her. She will graduate in the spring of 2017.

133She indicates that her expenses are approximate $4,100 per month without tuition or contributions to a registered retirement savings plan. The spousal support that was ordered by Justice McLean was $1,448 as of April 26, 2013, based on the applicant’s income of $110,000.

Quantum of Spousal Support

134The next step is to determine which range of support should be utilized in the circumstances. The applicant has sought the midrange of spousal support retroactive to May 1, 2013.

135The applicant commenced proceedings on February 14, 2013. On April 26, 2013, the court ordered the respondent to pay spousal support of $1,488 per month and $1,530 of child support to the applicant based on an income of the respondent of $110,000.

136When the parties settled the temporary order of Justice McLean on April 26, 2013, they used the sum of $110,000 for the respondent’s income. Subsequent evidence discloses that the respondent has earned $117,229 in 2013; $134,829 in 2014 and $119,502 in 2015.

137The applicant earned very little or no income in that three year period. During that three year period the children resided primarily with the applicant.

138Counsel for the applicant has provided SSAG calculations for 2013, 2014 and 2015. The SSAG calculations provide the following information:

Year 2013 Respondent’s income of $117,229 Payment of child support of $1,627 The range of spousal support: low – $1,632; mid – $1,909; high – $2,226

Year 2014 Respondent’s income of $134,829 Payment of child support of $1,836 The range of spousal support: low – $1,946; mid – $2,305; high – $2,058

Year 2015 Respondent’s income 119,502 Payment of child support of $1,654 The range a spousal support: low – $1,576; mid – $1,892; high – $2,219

139I find that the mid-range of spousal support under the Spousal Support Advisory Guidelines is appropriate and have taken into consideration the following factors:

(a) the strong compensatory nature of the applicant’s entitlement to spousal support; (b) the applicant’s needs as set out in her financial statement dated January 17, 2016; (c) the applicant being 37 years of age at separation; (d) the children being two and a half and one and a half years of age at separation; (e) the need of the applicant to retrain to pursue a career that will provide her with financial stability; (f) the applicant not being able to maintain the same standard of living to which she was accustomed during the marriage; and, (g) the respondent’s ability to pay.

Commencement Date

140Pursuant to the order of Justice McLean, the respondent was paying $1,488 which is below the low end of spousal support. Further, I note that the respondent consented to an order on September 25, 2015 to retroactively vary the child support so that the child support would be based on his actual 2013 and 2014 incomes.

141I see no reason why the spousal support should not also be adjusted retroactively to correspond to the respondent’s actual income back to May 1, 2013.

Order on Spousal Support

142Based on the above, I order that:

(a) Commencing May 1, 2013 and on the first day of each month thereafter up to and including December 1, 2013, the respondent shall pay to the applicant the sum of $1,900 per month as spousal support; (b) Commencing on January 1, 2014 and on the first day of each month thereafter up to and including December 1, 2014, the respondent shall pay to the applicant the sum of $2,300 per month as spousal support; (c) Commencing on January 1, 2015 and on the first day of each month thereafter up to and including December 1, 2015, the respondent shall pay to the applicant the sum of $1,875 per month as spousal support; (d) Commencing on January 1, 2016 and on the first day of each month thereafter, the respondent shall pay to the applicant spousal support in the amount of $1,700 per month.

Duration of Spousal Support

143According to the SSAG’s, the minimum duration of spousal support is two years and the maximum duration is 14 years from the date of separation. The evidence is that the parties resided together from the November 2008 to October 2012, a period of approximately 47 months.

144The applicant submits that the support should be reviewable eight months after she graduates from Teachers College, which would mean that support would continue until December 2017 at which time the support would be reviewed.

145The respondent submits that support should be five years from the date of separation meaning from October 2012 to October 2017.

146Periodic spousal support started to be paid on May 1, 2013 pursuant to the order of Justice McLean. From October 2012 to May 1, 2013 the parties resided together. The applicant did not work and the respondent was the main breadwinner and paid most of the expenses. Any expenses paid by the applicant were paid on her credit card.

147As I indicated, I find that the applicant has a very strong compensatory and non-compensatory claim for support. She is completing her teacher’s degree with an expected graduation in April 2017. She will have to find employment and is aware of her obligation to take reasonable steps to be self-sufficient. This is not a case of an indefinite support, but the applicant should be given the opportunity to educate yourself to have the best chance to make her self-sufficient in the shortest period of time. A review after December 31, 2017 will permit the court at that time to determine for how long and in what amount spousal support should continue to be paid.

148I order that the applicant’s entitlement, quantum and duration of spousal support shall be reviewed on the earliest of a material change in her circumstances or December 31, 2017.

Income Tax Considerations of Retroactive Spousal Support

149The respondent now owes spousal support arrears retroactive to May 1, 2013. The respondent is to be given credit for the spousal support paid since May 1, 2013. Part of those arrears will not be tax-deductible being from May 2013 to December 2014. I direct the parties to calculate the net amount owing by the respondent to the applicant on account of the non-tax-deductible arrears. In the event the parties cannot agree on such a calculation, I may be spoken to.

Medical and Extended Health Coverage for the Children

150Currently, the respondent does not have any medical or extended health coverage. The applicant secured health and medical coverage through the University of Ottawa for herself and her children.

151The respondent has an obligation to obtain and provide medical and extended health coverage for his children.

152Once the respondent obtains an employment, he will be obligated to designate the children as the beneficiaries of his medical and extended health coverage.

Life Insurance

153The applicant has sought security for the child and spousal support that she was seeking in this proceeding. In the application filed by the applicant she seeks an order that the support payments be made binding on the estate of the respondent and form a first charge on the estate of the respondent.

154The respondent’s financial statement filed as exhibit number 48 dated January 28, 2016 indicates that the respondent does not have any life insurance.

155As the respondent has an obligation to pay both child and spousal support, I order that the support payments will be binding on his estate and form a first charge on his estate.

Equalization of the Net Family Property

156The parties agreed on all the values used to calculate the net family property except two issues, being the $30,000 deposit made by the respondent and the value of the respondent’s real property located at Clyde Avenue at the date of the marriage.

$30,000 Deposit

157Regarding the matrimonial home, the respondent admitted that he signed an agreement of purchase and sale with the builder and he provided $10,000 on August 23, 2009 and $20,000 on September 8, 2009 with the house closing on October 17, 2009.

158He admits that on the date of marriage, September 26, 2009, both parties were co-owners of the new property as joint tenants. He indicated that the purchase price for the property was $377,162.35.

159The respondent’s position is that he should be entitled to a $30,000 deduction for the down payment that he put on the jointly owned matrimonial home prior to the marriage.

160During the parties relationship they lived at the applicant’s home in Kanata. After the respondent proposed in August 2009, the parties started looking for a new home.

161The parties signed an agreement of purchase and sale on August 23, 2009 to purchase 772 Fletcher Circle. The agreement of purchase and sale was signed jointly by the parties and required a deposit of $30,000.

162The parties married on September 26, 2009. At the time of the marriage the parties had a signed agreement of purchase and sale as joint owners.

163When the parties completed the purchase of 772 Fletcher Circle, the parties were listed as joint tenants. After the marriage and prior to the real estate closing, the applicant paid the sum of $45,000 towards the purchase price. This amount came primarily from the applicant’s inheritance from her deceased father’s estate.

164Consequently, as a result of the $30,000 deposit by the respondent and the $45,000 contribution by the applicant, the parties had a deposit of $75,000 leaving them with a mortgage of approximately $300,000.

165The respondent argues that he should be entitled to a deduction of $30,000 from his net family property representing the deposit paid on 772 Fletcher Circle, Ottawa, Ontario.

166The Family Law Act, R.S.O. 1990, c. F.3, as amended, requires the court to value assets at the date of marriage and as of the date of separation. As of the date of marriage, both parties were listed as co-owners in an agreement of purchase and sale for a property purchase to close one month after their marriage.

167On the date of the marriage, the deposits had been paid to the credit of a purchase of a jointly owned home. I find that on the date of the marriage the respondent is not entitled to a deduction of $30,000.

Value of Clyde Avenue

168On September 29, 2009 the parties married. At the date of the marriage, the respondent owned the property at Clyde Avenue. The issue is what the value of that property was on the date of marriage.

169Both parties have obtained independent expert appraisal reports. The respondent submits that the value of the property was $325,000 on the date of marriage and relies on the expert appraisal prepared by Leonard Carty of Carty Gwilym Appraisal Services.

170The applicant submits that the value of the property was $290,000 on the date of marriage and relies on an expert appraisal by the Affiliated Property Group.

171Neither expert testified at trial. The parties agreed that the court make a decision based on an analysis of the various reports and determine the fair market value of the property at the date of marriage.

172Upon a review of both appraisal reports, the appraisers have used different comparable properties in determining the fair market value of the property.

173The property in question had 1100 total square feet. It was a two-story semi-detached wood frame property with a full basement. The municipal assessment of the property was $318,000 as of January 1, 2012.

174In the Leonard Carty Appraisal dated January 4, 2016, the expert relies on three comparable properties. Two of the properties were on the same street as the subject property. The three comparable properties were broken down as follows:

(a) 1179 Clyde Avenue, 1410 square feet, sold for $350,000 on September 13, 2009; (b) 1163 Clyde Avenue, 1690 square feet, sold for $344,000 on July 17, 2009; (c) 48 Coleridge Street, 1349 square feet, sold for $338,000 on June 6, 2009.

175In the Affiliated Property Appraisal dated October 20, 2015, the expert relies on four comparable properties as follows:

(a) 28 Celebration Street, 1300 square feet, sold for $284,000 on May 3, 2009; (b) 187 Scout Street, 1100 square feet, sold for $285,000 on September 18, 2009; (c) 146 Scout Street, 1100 square feet, sold for $269,900 on July 9, 2009; (d) 175 Scout Street, 1350 square feet, sold for $290,000 on June 2, 2009.

176Both experts rely on the direct comparison approach as the most reliable methodology to take into account in this matter.

177In my view, the comparable properties used in the Affiliated Property Appraisal are closer in square footage than the comparables relied on by Leonard Carty.

178The Affiliated Property Appraisal uses comparable properties that are either 1100 square feet; 1300 square feet or 1350 square feet. On the other hand, the Leonard Carty comparables are 1349, 1410 and 1690 square feet. None of the properties were 1100 square feet.

179The subject property was listed for sale in March 2014 for $369,900. The listing price was reduced by $10,000 in each of April and May 2014. The property sold on in July 2014 for $332,500.

180I find that on the date of marriage, 1161 Clyde Avenue had a fair market value of $290,000.

Equalization Calculation

181Both parties agreed on the value of all assets and debts, premarital assets and excluded property save and except the two issues discussed above, being the deduction claimed by the respondent for the $30,000 deposit on the matrimonial home and the value of the respondent’s 1161 Clyde Avenue property on the date of the marriage. The parties filed a net family property worksheet highlighting those two issues as being required to be decided upon by the court.

182Based on my findings, the equalization of the net family property is as follows:

Assets Applicant Respondent Matrimonial home $240,000 $240,000 161 Clyde Avenue $325,000 General household items and vehicles $18,500 $7,475 Bank accounts and savings, $64,685.79 $135,659.07 Property owned on the valuation date $323,185.79 $708,134.07

Deductions Value of debts on valuation date $102,274.84 $209,400.11 Net value of property/debts on date of marriage $99,010.25 $269,983.03 Value of property excluded $500 Total $201,785.09 $479,383.14

Value of all property owned on valuation date $323,185.79 $708,134.07 Total debts, property on the date of marriage and excluded property $201,785.09 $479,383.14

Net family property $121,400.70 $228,750.93 Difference $107,350.23 Equalization owing by respondent to applicant $53,675.11

Post Separation Credits

183The respondent is requesting post-separation credits owed by the applicant to him. The applicant consents that she owes the respondent the sum of $2,825.11 set out as follows:

(1) $245.78 for half the cost of the GrapeVine advertising; (2) $79.33 for the May 13 payment of the applicant’s car insurance; and (3) $2,500 for the applicant’s retainer for her legal counsel.

184The respondent seeks the sum of $3,666.63 from the applicant:

(1) $2,516.83 representing half the taxes deducted from the proceeds of sale; (2) $758.30 representing the property taxes paid on the matrimonial home in June 2013; and (3) $391.50 representing the monthly house insurance premium for May through October 2013.

185With respect to the amounts claimed by the respondent, the order of Justice McLean dated April 26, 2013 granted the applicant exclusive possession of the matrimonial home. The respondent was required to pay both child and spousal support.

186The respondent seeks credit for the three items that he paid after the order of Justice McLean. The parties were joint tenants of the matrimonial home. As such, the respondent was equally responsible for the taxes and house insurance. According to the Trust Ledger Statement filed as exhibit number 60 both parties were charged $2,516.83 for the tax payable to the City of Ottawa. In my view, the parties shared this expense.

187The two remaining expenses total $1,149.80. These were expenses paid by the respondent with respect to the matrimonial home to which he no longer had exclusive possession but to which he remained a joint tenant. My view is that each party is responsible for one half of these expenses totaling $574.90. I order the applicant to pay to the respondent the sum of $574.90.

188I order that the applicant pay to the respondent the sum of $3,400.01 for post-separation credits.

Prejudgment Interest

189The court has jurisdiction to order prejudgment interest on the equalization payment pursuant to the Courts of Justice Act, R.S.O. 1990, c. C.3, as amended.

190As a general rule, the payor spouse is required to pay prejudgment interest on an equalization payment owing to the payee spouse…This encourages timely settlement of equalization claims as set out by the Court of Appeal held in Burgess v. Burgess (1995), 24 O.R. (3d) 547, at p. 553.

191However, the granting of prejudgment interest is discretionary as confirmed in Fielding v. Fielding, 2015 ONCA 901, 70 R.F.L. (7th) 253, at para. 43).

192The Court of Appeal in trial Burgess, supra at p. 554 and Fielding, supra at para. 43 indicated that an order for prejudgment interest may not be appropriate where “the payor spouse cannot realize on the asset giving rise to the equalization payment until after the trial, does not have the use of it prior to trial, the asset generates no income, and the payor spouse has not delayed the case being brought to trial.

193In this case, the payor spouse received his share of the sale proceeds of the matrimonial home in July 2014 in the amount of $118,000. At that time, the respondent could have made an advance on the equalization payment but failed to do so. In my view, prejudgment interest should run from July 2014 when the respondent received his share of the matrimonial home proceeds.

194The amount of prejudgment interest has varied since 2014. For the year 2014, the rate was 1.3%. In 2015, the average was 1%. In 2016, it is .08%.

195Considering all the circumstances, I find that prejudgment interest of 1% per year shall accrue on the equalization payment commencing July 1, 2014.

Divorce

196The evidence discloses that the parties married on September 26, 2009, separated on October 26, 2012, and that there is no chance of reconciliation. The particulars of the marriage were confirmed by the marriage certificate filed as Exhibit 43. Based on said evidence, a divorce order shall issue.

Disposition

197In summary, I make the following order:

(a) A divorce order shall issue; (b) Commencing on October 1, 2015 and for the each of the months of October, November and December 2015, the respondent shall pay to the applicant the sum of $1,654 per month as table child support; (c) Commencing on January 1, 2016 and on the first day of each month thereafter, the respondent shall pay to the applicant as table child support for the children Anya Pey, born February 3, 2010, and Parisa Pey, born May 29, 2011, the sum of $1,538 per month based on the respondent’s income of $110,000; (d) The parties shall share in the children’s section 7 expenses as set out in the Federal Child Support Guidelines; (e) Commencing May 1, 2013 and on the first day of each month thereafter up to and including December 1, 2013, the respondent shall pay to the applicant the sum of $1,900 per month as spousal support; (f) Commencing on January 1, 2014 and on the first day of each month thereafter up to and including December 1, 2014, the respondent shall pay to the applicant the sum of $2,300 per month as spousal support; (g) Commencing on January 1, 2015 and on the first day of each month thereafter up to and including December 1, 2015, the respondent shall pay to the applicant the sum of $1,875 per month as spousal support; (h) Commencing on January 1, 2016, and on the first day of each month thereafter, the respondent shall pay to the applicant spousal support of $1,700 per month; (i) The spousal support payments shall be increased on January 1 of each year commencing with January 1, 2017 by the percentage change in the Consumer Price Index for prices of all items since November of the previous year as published by Statistics Canada; (j) The applicant’s entitlement, quantum and duration of spousal support may be reviewed on the earliest of a material change in the applicant’s or respondent’s circumstances or December 31, 2017; (k) The applicant and the respondent shall notify the other within seven days of securing any employment and the particulars of their remuneration including income and benefits; (l) Upon the respondent securing any employment, he shall designate the children as the beneficiaries of his medical and extended health plan and provide written confirmation to the applicant within seven days of such designation; (m) The spousal support and child support payments set out in this order shall be binding on the estate of the respondent and shall form a first charge on his estate at the time of the respondent’s death; (n) The respondent shall pay to the applicant an equalization payment in the amount of $53,675.11; (o) The applicant shall pay to the respondent the sum of $3,400.01 representing post-separation adjustments; and (p) The respondent shall pay to the applicant prejudgment interest on the equalization payment calculated a rate of 1% per year commencing July 1, 2014.

Costs

198If the parties are unable to agree on the issue of costs, the applicant may file submissions not exceeding three pages in length plus attachments within 14 days of the release of these reasons for judgment. The respondent may file his submissions within a further 14 days with a right of reply within a further 5 days.