Roberts v. Roberts, 2020 ONSC 2935

Court File and Parties

COURT FILE NO.: FS-12-12068-02 DATE: 20200508 ONTARIO SUPERIOR COURT OF JUSTICE

BETWEEN:

Jolene Ann Roberts Applicant – and – Alfred Edwin Roberts Respondent

COUNSEL: Ian R. Fisher, for the Applicant Jonathan M. Sinopoli, for the Respondent

HEARD BY CONFERENCE CALL: April 24, 2020

Ruling on Motion

HEBNER J.:

[1] The applicant and the respondent were married on July 15, 1986. They separated on November 6, 2011. The respondent is required to pay spousal support to the applicant in the sum of $17,224 per month pursuant to the consent divorce order of Verbeem J. dated May 14, 2014.

[2] This motion is brought by the respondent seeking a reduction in the spousal support payable. The quantum of spousal support set out in the divorce order specifies that it is based on the respondent having an annual income of $600,000 and the applicant having an annual income of $0.

[3] The respondent is an anesthesiologist by profession. The respondent claims that he had to stop working in August 2019 as a result of a disability and his income has been reduced to disability insurance income of $104,400, not taxable. The respondent seeks a reduction in spousal support to be calculated in accordance with the Spousal Support Advisory Guidelines and his reduced income.

[4] This motion was brought during a time when the court has suspended its normal operations due to the global COVID-19 pandemic. By endorsement dated April 17, 2020, I found the motion to be urgent and directed that it proceed. My finding of urgency was preliminary only.

Applicant’s Financial Circumstances

[5] The applicant is 61 years of age. She is not employed. There is no suggestion that she ought to be employed. The applicant’s income is in the form of investment income and spousal support. In 2018, the applicant’s investment income was $18,665. The applicant asserts in her affidavit that she suffers from lupus pneumonitis. She has had two separate bouts of pneumonia and has been hospitalized on three separate occasions in 2020. She has a need for significant medications. She has privately acquired two drug plans at a cost of $5,000 per annum in order to cover the costs of her medications.

[6] The applicant’s financial statement dated September 25, 2019, discloses the following:

1. The applicant owns her own home in Belle River which she values at $450,000. The home is mortgage free.
2. The applicant drives a 2015 Lexis.
3. The applicant has approximately $212,000 in bank accounts.
4. The applicant has various RSP’s, iTRADE accounts and TFSA accounts totaling approximately $654,000.
5. The applicant has credit card debt of approximately $2,500.

Respondent’s Financial Circumstances

[7] Until August 2019, the respondent was employed at Windsor Regional Hospital as an anaesthesiologist through his professional corporation, A. E. Roberts Medicine Professional Corporation. In 2018, the respondent’s income was $634,767. According to the respondent, in August 2019 he was diagnosed with cardiac arrhythmia and congestive heart failure. He became unable to work and began receiving disability group insurance from the Ontario Medical Association in the amount of $104,400 per annum. These payments are not taxable.

[8] The respondent provided a financial statement dated April 14, 2020, that disclosed the following:

1. The respondent has re-partnered. He and his partner jointly own a home in Belle River valued at $1 million.
2. There is a mortgage on the home in the amount of $699,663. The respondent pays the entire monthly mortgage payment of $5,980.
3. The respondent has bank accounts totaling $84,398, investments totaling $808,085 and RRSP/pension assets totaling $304,817.
4. In addition to the mortgage, the respondent claims to have a loan owing to his professional corporation in the sum of $100,000.

Respondent’s Medical Condition

[9] The respondent asserts that he has a long-standing heart condition, namely severe left ventricular dysfunction. The respondent’s cardiologist, Dr. Glanz, provided a medical report dated March 2, 2020. In that report Dr. Glanz outlined the progress of the respondent’s medical condition from the time he first saw the respondent in 2014. He said that in 2014, Dr. Roberts was “fairly asymptomatic”. His echocardiogram reported an ejection fraction of 50-55 percent that raised the possibility of a “diagnosis of non-compaction of the left ventricle”. He did reasonably well over the next few years.

[10] According to Dr. Glanz, in July of 2019, Dr. Roberts developed rapid palpitations that were felt to be a supraventricular tachycardia. He underwent a MUGA scan showing an ejection fraction of 19 percent. A second MRI performed at Henry Ford Hospital in Detroit showed a left ventricular ejection fraction to be 30 percent and a pattern of scarring consistent with a diagnosis of cardiac sarcoidosis. Dr. Roberts had a primary prevention defibrillator implanted on October 23, 2019 and his medications were adjusted. His last echocardiogram on February 10, 2020, showed an ejection fraction of 30-35 percent.

[11] On Dr. Roberts’ prognosis and ability to work, Dr. Glanz said the following:

You have asked regarding his prognosis and the chance of recovery or improvement. He has had some improvement from his lowest ejection fraction measured of 19% to his current ejection fraction of 30 – 35%, and this is likely as a result of the optimization of his medications. It is impossible to predict if his ejection fraction will improve further, although I think given the long-standing nature of his left ventricular dysfunction, it will likely never return to normal.

You have also asked my opinion as to his ability to return to work. There is an imperfect correlation between ejection fraction and symptoms. My own sense is that Dr. Roberts will be able to return to work on a part-time basis. How many hours per week he will be able to work will best be determined by himself and the intensity of the work he is doing. Clearly, the work of an anethsetist will often times be high stress and high intensity, and I feel it will be impossible to predict exactly how much work he will be able to do. Furthermore, his energy level and stamina may change over time. (My) hope will be that he will be able to at least work part-time.

In summary then, Dr. Roberts most likely has a diagnosis of cardiac sarcoid that has left him with significant left ventricular dysfunction. By objective standards, his left ventricular ejection fraction has improved over the past few months. I think it is unlikely that it will improve much more. Symptomatically, I feel that he will likely be able to return to work on a part-time basis, in a manner that will need to be flexible depending on his energy levels and stamina. Hopefully he can return to work in a graduated manner.

[12] In his affidavit, the respondent claims that work as an anaesthesiologist can be stressful and demanding, usually 12 hour shifts, 60 hours per week. He hoped to return to work part time in the spring or summer of 2020 but the COVID-19 global pandemic interfered with those plans. Given his health condition, the respondent is required to self isolate until the pandemic is over. The respondent opines that his ability to work in the future will depend on the progress of his heart condition and the ability of his employer to accommodate him.

Analysis

[13] The governing legislation is s. 17 of the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.), as amended. The relevant subsections are:

17(1) A court of competent jurisdiction may make an order varying, rescinding or suspending, prospectively or retroactively,

(a) a support order or any provision thereof on application by either or both former spouses;

(4.1) Before the court makes a variation order in respect of a spousal support order, the court shall satisfy itself that a change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order or the last variation order made in respect of that order, and, in making the variation order, the court shall take that change into consideration.

(7) A variation order varying a spousal support order should

(a) recognize any economic advantages or disadvantages to the former spouse arising from the marriage or its breakdown;

(b) apportion between the former 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 former spouses arising from the breakdown of the marriage; and

(d) in so far as practicable, promote the economic self-sufficiency of each former spouse within a reasonable period of time.

[14] Dr. Roberts launched his motion to change in reliance on s. 17 of the Divorce Act. This motion before me is for a temporary order, brought within the context of the motion to change. The test for an interim variation is articulated by McDermot J. in Raaflaub v. Gonosch, 2020 ONSC 1578, at para. 7, as follows:

[F]or there to be a temporary change in support, the moving party must address four issues:

1. Is there a good prima facie case for a variation of support;
2. Would continuation of support result in a hardship to the payor?
3. Is the matter sufficiently urgent to vary support on a temporary basis; and
4. Does the moving party come to court with clean hands?

Material Change

[15] Dr. Roberts relies on his disability resulting in a loss of income from over $600,000 per annum to $104,400 per annum.

[16] In Roloson v. Clyde, 2017 ONSC 3642, Chappel J. set out the meaning of “material change” at para. 49:

The case-law that has addressed the meaning of the phrase “material change in circumstances” in the context of child and spousal support variation proceedings has also established that a change will only be considered “material” if it is significant and long-lasting (Brown v. Brown, 2010 NBCA 5, 2010 CarswellNB 30 (N.B.C.A.); Haisman v. Haisman, 1994 ABCA 249, 1994 CarswellAlta 179 (C.A.), leave to appeal to the S.C.C. refused, [1995] 3 S.C.R. vi (S.C.C.)). Trivial, insignificant or short-lived changes will not justify a variation (Haisman; Hickey v. Hickey (1999), 46 R.F.L. (4th) 1 (S.C.C.); Marinangeli v. Marinangeli, 2003 CarswellOnt 2691 (C.A.)).

[17] In this case, Dr. Roberts’ income from employment has declined to approximately 17.4 percent of what it was at the time of the divorce order. The change is material. That much is clear. Is it long-lasting?

[18] Dr. Glanz’s opinion is that it is unlikely that Dr. Roberts’ cardiac condition will improve much more. His opinion is that Dr. Roberts will likely be able to return to work on a part-time basis in a graduated manner. I take from Dr. Glanz’s report that Dr. Roberts will not be in a position to return to work full time. Dr. Roberts has indicated that, as a result of his compromised medical condition, he is unable to return to work at all until after the COVID-19 pandemic has passed. I accept that evidence. The result is that Dr. Roberts’ income will be limited to his disability insurance income for the foreseeable future. After the COVID-19 pandemic has passed, Dr. Roberts’ income will likely change with his return to work part time, however it will still most likely be significantly less than what it was at the time of the divorce order.

[19] Given the foregoing, I conclude that Dr. Roberts will have a long-lasting change in income, although not necessarily the change he is experiencing now.

[20] The current change in income is significant. The fact that there will be a change in income is long-lasting. I, therefore, conclude that the first branch of the test has been met.

Prima Facie Case

[21] Dr. Roberts needs to show that there is a strong prima facie case for a change in spousal support. There have been no cross-examinations. The affidavit evidence is untested. However, Dr. Roberts has provided medical evidence of his inability to work. He has proven a substantial reduction of income. It seems to me highly unlikely that, if Dr. Roberts’ medical condition and income was at the time of the divorce order as it is now, that he would have been required to pay spousal support of $17,000 per month. In my view, Dr. Roberts has shown a strong prima facie case for a change in spousal support.

Hardship

[22] Counsel for Mrs. Roberts suggests that Dr. Roberts has sufficient investment assets such that he can continue to pay the current level of support without incurring hardship. I disagree.

[23] Currently, in-person hearings of this court are suspended until at least the beginning of July. As previously indicated, this proceeding is still relatively new. There have been no cross-examinations on the affidavit evidence. The parties have not yet had a settlement conference. When the court returns to full operations, a backlog is expected. I expect this matter will not be reached for trial until sometime in 2021. Dr. Roberts sustained his reduction in income in August 2019. If Dr. Roberts were to be required to continue to pay the current court ordered support, he will most likely pay too much by a significant amount. I have already found a strong prima facie case.

[24] Dr. Roberts is unable to pay the current level of support without significantly depleting his retirement investments. Mr. Sinopoli suggests that Dr. Roberts ought not to be required to do so. I agree particularly given Dr. Roberts’ age coupled with his current medical condition. Both of these parties have significant retirement savings. The financial statements of the parties show that should Dr. Roberts be required to continue paying the current level of spousal support, he would be depleting his retirement investments while, at the same time, Mrs. Roberts would be increasing hers.

[25] I suspect it likely that, once this matter is dealt with on a final basis, any variation to the support order would operate retroactively. In that event, were Dr. Roberts required to pay the current court ordered support, Mrs. Roberts would possibly be in the position of reimbursing Dr. Roberts for a substantial overpayment. Such a result could cause hardship to Mrs. Roberts.

[26] McDermot J. in Raaflaub at para. 33 said the following about the hardship test:

Caselaw suggests that the court must find hardship or alternatively that the continuation of the existing order would be absurd and incongruous: see Clark v. Vanderhoeven, 2011 ONSC 2286 at para. 67. This latter approach has been defined as being “inappropriate, unreasonable or ridiculous”: see Hayes v. Hayes, 2009 ONCA 609 at para. 38.

[27] I agree with this interpretation of the law. In light of the strong prima facie case demonstrated by Dr. Roberts for a reduction in spousal support and considering the relative financial circumstances of the parties, I find that the continuation of the existing support order would be absurd and incongruous. Accordingly, the third branch of the test is met.

Urgency

[28] Mr. Fisher, on behalf of Mrs. Roberts, argued the issue of urgency both in the context of the test for an interim variation of spousal support and in the context of urgency required for the motion to proceed during the COVID-19 pandemic.

[29] In the pandemic context, as I understand Mr. Fisher’s argument, he points out that there are many, many support payors who will suffer from a reduction in income during the course of the COVID-19 pandemic. For many of these support payors, the quantum of the reduction will be significant. He asserts that if Dr. Roberts’ reduction in income qualifies as urgent then surely all other support payors who have suffered a reduction in income due to COVID-19 will be entitled to proceed with a motion to suspend their support obligations on an urgent basis. The argument is a floodgates argument.

[30] I reject Mr. Fisher’s argument for the simple reason that the reduction in Dr. Roberts’ income is not entirely related to the COVID-19 pandemic. Indeed, it occurred prior to the COVID-19 pandemic. A reduction in income will likely continue following the completion of the pandemic albeit hopefully to a lesser degree. In other words, the reduction in income in this case is not just a temporary pandemic related reduction.

[31] In the context of the test for a temporary variation of support, there will most likely be overpayments in spousal support to Mrs. Roberts if this court does not act. In my view, the likely result is a significant overpayment in support. A refusal to act will, in my view, most likely result in an injustice to the respondent. Moreover, a refusal to act may result in an injustice to the applicant as she may be facing a retroactive adjustment that would require a significant reimbursement of support payments.

[32] I, therefore, find that there is sufficient urgency for the spousal support to be adjusted at this time.

Clean Hands

[33] Mr. Fisher points out that Dr. Roberts is in arrears of his spousal support obligations. In Dr. Roberts’ affidavit sworn April 14, 2020, he acknowledges spousal support arrears of $34,085.20. This figure represents almost two months worth of support at the court ordered rate of $17,224 per month. What this tells me is that Dr. Roberts maintained support at that rate from August 2019, when he left his employment as a result of his disability, until at least January 2020.

[34] In addition, Mr. Fisher points to the life insurance requirement set out in the divorce order. By that order, Dr. Roberts is required to maintain life insurance with a face amount of $1,000,000 with Mrs. Roberts as the beneficiary. Mrs. Roberts has made requests for confirmation that the policy remains in place. Mrs. Roberts asserts that the confirmation was not forthcoming. In his reply affidavit, Dr. Roberts confirms that the life insurance remains in place and provides proof in the form of screenshots from his Ivari online account.

[35] I do not consider two months in arrears of spousal support to be sufficient to conclude that Dr. Roberts has unclean hands. I take into account the fact that the motion to change was launched in August of 2019 and the case conference took place on February 4, 2020; the extent of the reduced income; the strong prima facie case for a variation; and the fact that Dr. Roberts maintained the court ordered payments for approximately five months following his departure from employment.

[36] As for the life insurance, given that the insurance is in place, I do not consider a non-response to requests for a statement sufficiently discreditable conduct so as to constitute a failure to come to court with clean hands.

Quantum

[37] Mr. Fisher’s position is that I ought to impute interest income to Dr. Roberts on all of his investments at three percent, for a total of approximately $26,000 per annum. At the same time, he submits that I ought to include Mrs. Roberts investment income of $5,863 without imputing any more. Mr. Sinopoli takes the position that no income ought to be imputed to Dr. Roberts.

[38] For the following reasons, I decline to impute any investment income to Dr. Roberts. At the same time, I decline to impute any investment income to Mrs. Roberts, and I decline to include her stated investment income of $5,863.

[39] Both of these parties have significant investments. In ordinary times, one would consider imputing some interest income based on total investments. However, these are not ordinary times. I take judicial notice that the COVID-19 global pandemic has taken a significant toll on the value of investments globally. Once we are through this pandemic, Dr. Roberts’ investment portfolio may look entirely different. The same can be said for Mrs. Roberts’ investment portfolio. With a significant change in the value of the parties’ respective investments, most likely a significant change in investment income will follow.

[40] Moreover, there is insufficient evidence before the court. Aside from the parties’ financial statements, I do not have particulars of the assets each of them has in their investment portfolios and the extent of any income producing assets. In ordinary times, this may not be a barrier to an imputation of some investment income. However, these are not ordinary times.

[41] Even if the parties had provided current, up-to-date evidence on investment portfolios, an imputation of investment income would still pose a risk. The market’s response to the pandemic is resulting in a daily change of investment values and resulting incomes.

[42] It seems to me that, in these unusual times, it is best not to include any investment income for either party when calculating the appropriate interim spousal support order. I fully expect that when that when the pandemic is over, and the parties are able to provide better evidence on their investment incomes, the matter will be returned to court for an adjustment to the order I make today. Similarly, I expect an adjustment to be made when Dr. Roberts is able to return to work part time and his income is better established. Moreover, the judge hearing the motion to change will have better evidence and will be in a position to adjust this order retroactively.

[43] Given the specific quantum of spousal support payable at the time of the divorce order, I strongly suspect that the amount was based on the Spousal Support Advisory Guidelines. Mr. Fisher, who was counsel for Mrs. Roberts at the time, said that he does not have a specific recollection but agrees that the order was most likely based on the Spousal Support Advisory Guidelines. I intend to use the Guidelines to assist me in coming to an appropriate quantum of interim support now.

[44] My DivorceMate calculation is attached. I have used Dr. Roberts non-taxable disability income with the appropriate gross up. I have set Mrs. Roberts’ income at $0. My calculation produced a range of between $4,756 and a $4,835 per month. The higher amount results in an equal division of Dr Roberts’ disability insurance income, and I find that to be appropriate in the circumstances. Accordingly, I set the amount of interim spousal support at $4,835 per month.

Retroactivity

[45] Mr. Sinopoli suggests that the order be made retroactive to August of 2019. I am not prepared to make that order. The result would be an immediate overpayment of support that would have to be repaid or alternatively the overpayment offset against ongoing support. In either case, such an order could result in a hardship for Mrs. Roberts. I think it more appropriate to have the new support amount payable commencing May 1, 2020, and stay the enforcement of current arrears accumulated under the divorce order. Any retroactive adjustment ought to be left to the trial judge who will have the benefit of more complete evidence.

Life Insurance

[46] Dr. Roberts’ motion had also included a request to reduce the face amount of insurance required for Mrs. Roberts. Mr. Sinopoli reasonably agreed that that issue did not meet the definition of urgency for the purpose of proceeding at this time and ought to be left to another day.

Disposition

[47] For the foregoing reasons, I make the following orders, all on a temporary without prejudice basis:

1. The divorce order of Verbeem J. dated May 14, 2014, shall be varied on an interim basis to provide that the respondent, Dr. Roberts, pay to the applicant, Mrs. Roberts, spousal support in the sum of $4,835 per month commencing May 1, 2020.
2. The enforcement of the support arrears outstanding as at April 30, 2020, shall be stayed pending further order of the court.
3. The respondent shall request a statement from his life insurance carrier confirming that the life insurance policy in the amount of $1 million required by the divorce order remains in good standing with Mrs. Roberts as the sole beneficiary.
4. Either party may return the matter to court following the completion of questioning for an adjustment to the spousal support and/or the life insurance.
5. Costs are reserved to the trial judge.

Pamela L. Hebner Justice

Released: May 8, 2020