COURT FILE NO.: FS-20-43623 DATE: 2023 10 25

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: R.L., Applicant AND: M.F., Respondent

BEFORE: Kurz J.

COUNSEL: Martha McCarthy and Jonathan Robinson, for the Applicant Judith Nicoll, for the Respondent

HEARD: In Writing

Endorsement

Introduction

[1] I have now reviewed written submissions from the parties regarding the remaining issues in this proceeding, in accord with my trial endorsement of May 12, 2023 (the “trial endorsement”). While they were submitted in late July and late August 2023 the parties’ submissions only recently came to my attention.

[2] Each party’s submission deals with the following issues, which I will deal with in order:

1. A Six-Month Review Regarding Certain Parenting Terms for the Children;
2. Equalization Payment;
3. Prospective s. 7 Expenses;
4. Retroactive s. 7 Expenses;
5. Life Insurance to Secure Support Payments;
6. Retroactive Spousal Support; and
7. Post-Separation Adjustments.

Six-Month Review Regarding Certain Parenting Terms for the Children

[3] At paras. 240 – 241 of my trial endorsement, I ordered and directed as follows:

240 I will review the parenting terms of my order in six months in order to determine whether to expand, contract or otherwise change B.'s parenting time with the Father and consider what further steps, if any, should be taken regarding counselling. In as much as I have not ordered a further assessment (which neither party has requested), upon the review, I intend to engage in a judicial interview with either or both children, subject to their right to decline such an interview.

241 I will also meet with the children, coincident with the release of this endorsement, to explain my decision and expectations to them.

[4] The Applicant Father submitted that the review should take place at a time that is minimally invasive to the children. He takes no position regarding a judicial interview of the children before that review.

[5] The Respondent Mother states that she “takes no strong position as to when the six-month review should take place”. She adds that the girls would like to attend for such an interview and would like to do so together. She suggests that the review take place during the week of January 2 – 5, 2024. In the alternative, she requests that it take place on a Friday. I am not sitting during the week of January 2 – 5, 2024. However, I am willing to make myself available on any other Friday afternoon, after school, in January 2024.

[6] Prior to my interview with the children, I ask the parties to provide me with brief submissions (no more than five pages) setting out their position regarding ongoing parenting time between the Father and children, the counselling between B. and the Father and their reasons for their positions. Their submissions will be just that and not be evidence. But they will be helpful in guiding my interview with the children, determining which issues remain and what next steps, if any are required regarding those two ongoing parenting issues.

Equalization Payment

[7] The parties have already agreed that the equalization payment owing by the Father to the Mother is $474,744.36.

Prospective Section 7 Expenses

[8] At trial, the Mother agreed with the Father’s proposed s. 7 monthly expense figure of $6,627 per month. That amount is based on the children’s current s. 7 expenses.

[9] Each party raises the question of what should happen if the children’s actual s. 7 expenses are not $6,627 per month. The Father is concerned with what will happen if the actual expenses are less than that figure. He seeks an order that sets out the actual current expenses, along with language stating that those expenses will be “up to the amounts set out below”.

[10] The Mother agrees that the Father should only pay for s. 7 expenses that are actually incurred. But she fairly points out that those expenses are not likely to be static for the entirety of the term of the children’s entitlement to support. She seeks a term that will allow for the payment of any increase of the fees charged for the agreed upon s. 7 expenses. I agree.

[11] Thus, I generally adopt the Mother’s proposed wording regarding prospective s. 7 expenses as follows:

The current annual s. 7 expenses for the children shall include all of the items set out below, with their current cost as of October 2022 as follows:

a. A. [1] : Hillfield Strathallan College (“HSC”) tuition: $31,521 b. B.: HSC tuition: $31,521 c. A. and B.: activities comprising soccer (including coaches and private lessons), gym, AI, flute: $6,000 d. A. and B.: tutoring, Study.com, Licharts, Brittanica, Enotes etc.: $5,000 e. A. and B.: Inception cord blood storage: $168 f. A. and B.: Medical and Dental Costs: $5,316

Total Net Annual Amount: $79,526 Total Monthly Amount: $6,627.17 per month

The parties may incur these expenses without the prior consent of the other, whether the actual costs incurred are more or less than was the case in October 2022.

In addition, the parties shall consult with one another regarding any further section 7 expenses as they may arise from time to time.

The parties shall reconcile all s. 7 expenses on a monthly basis or as otherwise agreed and each shall promptly pay to the other the money owed.

[12] The other issue is the ratio of payments to the parties’ incomes. The parties agree that effective January 1, 2023, the proper ratio of payments is 69.4% for the Father and 30.6% for the Mother. This amount shall be adjusted annually, based upon the actual income for the Father and the imputed income for the Mother.

[13] In addition, the Mother responded to my request for submissions as to university expenses. The Father did not do so. A. is expected to commence university in less than a year. Nonetheless, it is premature to consider which university A. will attend, her proposed course of study and the likely costs.

[14] The Mother asks the court to:

1. Order that the children’s university studies be funded through two degrees; and that
2. The funding includes at minimum, tuition, tutoring, residence or accommodation expenses, lab fees, technology needs, meal plans or food, ancillary expenses and travel to and from university.

[15] As stated above, the Father has not responded to the issue of university expenses other than in regard to life insurance, as set out below.

[16] My review of my trial notes shows that no evidence was offered at trial regarding the children’s anticipated university expenses. But the children have proven themselves to be excellent students. I have little doubt that, subject to something unforeseen, the two children will each enter university. Each will likely pursue more than one degree.

[17] Both parties’ own educational paths demonstrate the importance of educational accomplishment. Each has earned more than one university degree. Those degrees have greatly contributed to their financial success.

[18] Between them, the parties have saved $120,000 in RESP’s, which they have agreed to equally divide.

[19] Because the issue of a second degree was not raised and no evidence was given regarding that degree, I choose not to make an order in that regard. That is particularly the case because I do not know whether either child will be required to make a contribution herself to their education at the time of their second degree and the costs of the various options that may be available to them for their post-graduate education.

[20] That being said, I note that in Decaen v. Decaen, 2013 ONCA 218, [2013] O.J. No 1549 (Ont. C.A.), at para. 58, the Ontario Court of Appeal stated that “parents of significant means may be ordered to pay support for a second degree”. I assume that, subject to a material change in circumstances, both parties will continue to support their daughters’ educational careers into a second degree course of education.

[21] With regard to their first degree, I accept that s. 7 university expenses for both children should include tuition, tutoring, residence or accommodation expenses, books, lab fees, technology needs, meal plans or food and so order.

[22] The Mother also seeks to include an order for ancillary and travel expenses for the children while in university without saying what those terms encompass. For example, does she propose train travel a few times per year or the purchase of a car for each child? Those ancillary and travel expenses must be reasonable and agreed upon in advance. If they are unable to agree, I suggest mediation or parenting coordination, but failing that, it remains open to them to return the issue to court.

[23] In light of the parenting arrangements currently in place, the Father shall be presented with a proposed annual budget of expenses for each child, in advance of that child entering university and each year of university thereafter. I have not found him to be parsimonious or unreasonable with regard to his children’s expenses.

[24] The parties may each apply their half of the children’s RESP’s towards their contributions to the children’s university expenses.

Retroactive s. 7 Expenses from October 2021 to December 2022

[25] The Mother complains that I ordered a stopwatch trial, which did not allow her to present her full evidence regarding her claim to retroactive s. 7 expenses. She concedes that the same is true of the Father. The stopwatch trial was ordered on consent in order to ensure that this trial could take place in the fall 2022 blitz after the illness of the Mother’s counsel.

[26] At trial, each party offered a spreadsheet of alleged expenses, without any further documentary proof of those expenses. That being said, the Father was cross-examined about his spreadsheet but the Mother was not. The Father complains that the Mother did not lead evidence about her spreadsheet, although it was contained in her exhibit book. As a result, he submits that he did not cross-examine her on her spreadsheet.

[27] In other words, neither party has tendered any documentary evidence proving the expenses they claim. Nor has any party produced any agreement or admission as to those expenses. Rather, I am left with conflicting spreadsheets claiming unverified expenses, whose veracity is not accepted by the opposing party.

[28] The Father claims that he spent a total of $34,538 in expenses. He claims that these expenses have been “tested” at trial because they were included in the cross examination by the Mother’s counsel. He adds that the Mother’s spreadsheet claims a total of $29,027. But he complains that many of those claims do not meet the test of “special and extraordinary” set out in s. 7(1.1) of the Child Support Guidelines. He refers to some cash transactions and minor claims, including $10.17 for gasoline. He concludes on this point that if the court is willing to accept the Mother’s spreadsheet without the benefit of evidence, it should simply call them a wash and make no order.

[29] The Mother responds that if the issue cannot be decided simply on a review and comparison of the two spreadsheets, the court must receive additional evidence on the issue, including receipts and a review of bank records. She adds that the Father’s list of alleged retroactive s. 7 expenses was received on October 18, 2022, only six days before the trial commenced. That was already a week after the date that the trial was scheduled to commence, on October 11, 2023. The trial did not begin that day because the Mother’s counsel had taken ill. Until then the Mother had no evidence of the Father’s alleged expenditures. I am not inclined to reopen the trial in this matter on the issue of retroactive s. 7 expenses from October 2021 to December 2022. Nor am I prepared to make a trial order on the basis of duelling spreadsheets.

[30] It was open to both parties to provide their evidence by way of receipts, credit card and bank statements or other evidence. They could have exchanged requests to admit regarding those expenses. Neither did so.

[31] In exercising my discretion in this regard, I have considered:

1. The absence of any real evidence, agreement or admissions regarding those claimed expenses;
2. the trial time already consumed;
3. the needs of other parties seeking to have their cases heard or tried;
4. the amounts that have been paid and which I order to be paid;
5. Subrules 2(2) – (5) of the Family Law Rules and in particular, r. 2(3)(c), (d), and 5(e).

Life Insurance

[32] The Father suggests that $1.6 million is the proper amount of life insurance to secure child and spousal support based on the incomes determined at trial and the support terms I have granted. The Mother seeks $3 million instead. She states that the Father’s calculation understates the amount required by about 50% because it excludes:

1. s. 7 expenses agreed upon as set out above;
2. Table support until each child turns 18. However, each child may live at home in part or whole while attending university, increasing the time that table support will be payable.
3. The amount that will be required to pay for the children’s university, over and above the $60,000 in RESP funds that each party holds. Further, the Father will be required to pay a far greater proportion of those expenses than the Mother.

[33] I generally agree with the Mother’s submissions. However the full details of the children’s university costs and whether they will be living at home or on campus is unknown. Further, her own SSAG calculation based on the parties’ present incomes as I found or imputed them, calls for an estimated life insurance requirement of $2,111,834. The father’s calculation is $1,582,033.

[34] I find that $2.1 million is an appropriate figure for the Father’s insurance obligations at this time and so order.

[35] The parties agree that the amount of insurance may be reduced by $200,000 every two years, which I accept and order.

[36] The Father asks that the commencement of either child at university be treated as a material change in circumstances. I do not agree. A. will almost certainly attend university in one year. B. will almost certainly do the same two years later. The children’s attendance at university is contemplated and foreseeable. Thus, it would not represent a material change in circumstances: Willick v Willick, [1994] 3 S.C.R. 670, at para. 21, L.M.P. v. L.S., 2011 SCC 64 at para. 39 and 44. The biennial diminution of the amount required to insure the Father’s support obligations is sufficient to deal with that event.

Retroactive Spousal Support

[37] Based on my trial findings, there are four periods in which retroactive spousal support is payable. They are:

1. January – May, 2023
2. July – December 2022
3. January – June 2022
4. October – December 2021

[38] I agree with the Father that the Spousal Support Advisory Guidelines (“SSAG”) contemplate the possibility of two incomes for support purposes, one for child support and another for spousal support: Spousal Support Advisory Guidelines Revised User’s Guide, Ch. 6(g).

[39] That point is apposite for the period between October 2021 – December 2022. CBV Paula White testified, the parties agreed, and I accepted that it was appropriate to back out certain figures from the Father’s 2021 and 2022 income to avoid “double-dipping” of already-equalized components of the Father’s income. For 2021 the figure is $396,371 and for 2022 it is $211,714. That means that child support for those years is based on an income of $2,031,822 for both years, but spousal support will be based on an income of $1,635,451 for 2021 and $1,820,108 for 2022.

[40] Based on those findings, and my trial findings regarding the Mother’s income for support purposes, the Father set out the following chart, which accurately sets out the parties’ incomes for spousal support purposes:

Period	Applicant Income ($)	Respondent Income ($)	Period	Applicant Income ($)	Respondent Income ($)
2021 (Oct.)	1,635,451	350,000	2022 (Jul.)	1,820,108	550,000
2022 (Jan.)	1,820,108	350,000	2023	2,031,822	550,000

[41] The Father says that the calculation of spousal support should be consistent with my calculation of support for 2023 onward. By that he means that the parties’ net disposable income (“NDI”) for the periods of 2021 and 2022 set out above should be consistent with their NDI for 2023 onward. The Mother does not disagree with that submission but disagrees with regard to its application.

[42] In the trial endorsement, I ordered that the Father pay $20,000 per month in spousal support, which when combined with table child support of $24,661, gave the Mother a NDI of 56.7%, leaving the Father with an NDI of 43.3%. The Father relies on my findings of income for the parties for the periods described above, the $24,661 table support that I ordered and a reasonable estimate for s. 7 expenses.

[43] Using those incomes, he says that when he paid $14,000 per month on an interim basis, he ultimately overpaid spousal support by $14,730. I set out his calculation chart below:

(The original document did not provide a chart for paragraph 43. This section is left as is to reflect the original content.)

[44] The Mother disagrees with this calculation. She points out that the Father had not paid all of the s. 7 expenses, except school costs, when they were incurred. He waited until trial to agree to pay some and has not paid others which she claims. But with my trial decision and this one, the appropriate s. 7 expenses will be paid.

[45] The Mother also submits that in light of the Father’s two incomes for support purposes, “[t]he only way that we can possibly rationalize the use of a consistent NDI across the terms is to use the child support figure that would have been used had both child and spousal support been based on the same income”. That results in the Mother’s calculation that the Father owes her $39,447 net in retroactive spousal support as of December 31, 2022. That computation is based on actual payments of $14,000 per month and calculations of the proper amounts of support as follows:

1. October – December 2021: $18,475/mo. gross, leading to a shortfall of $4,475/mo. x 3 mo. or $13,425 gross or $6,237 net.
2. January – June 2022: $22,419/mo. gross, leading to a shortfall of $8,419/mo. x 6 mo. That works out to $50,514 gross or $23,472 net.
3. July - December 2022: $17,493/mo. gross, leading to a shortfall of $3,493/mo. for six months. That works out to $20,958/mo./ gross or $9,738/mo. net.

[46] Both parties agree that the Father owes the Mother $6,000 per month (the $20,000 per month that I ordered minus the $14,000 per month he has paid for the first five months in 2023 or $30,000.

[47] I have spent some time reviewing each party’s submissions and their Divorcemate SSAG calculations. While they have relied on virtually identical inputs, including the 56.7%/43.3% NDI split, they arrive at different support figures. By way of example, for 2023, that split leads to a monthly spousal support figure of $22,419 for the Mother and a correct $20,000 figure for the Father. The Mother’s other calculations offer far higher amounts of monthly support than those of the Father. The following chart demonstrates the difference:

Period + Incomes	Mother’s Monthly Figure	Father’s Monthly Figure
Oct-Dec.2021	$18,475	$7,260
F: $1,635,451
M: $350,000
Jan.-June 2022	$22,419	$16,446
F: $1,820,000
M: $350,000
July – Dec. 2022	$17,493	$9,642
F: $1,820,000
M: $550,000

[48] Generally, the determination of spousal support, including retroactive spousal support represents a greater exercise in discretion than the determination of child support: A.E. v. A.E. 2021 ONSC 8189, at paras. 473 – 474, 476, Kerr v. Baranow, 2011 SCC 10, at para. 208, 211. [2] My determination of a $20,000 per month prospective spousal support award was not based on a mechanistic application of a particular NDI ratio. Rather it was based on a discretionary consideration of a number of relevant factors. I stated at para. 362:

362 I find that ongoing spousal support of $20,000 per month is well above the Mother's needs, and about $14,000 per month above the 50/50 NDI figure. It fairly compensates the Mother for the role she played in the marriage and the advantages that the Father accrued from that role. In light of the other payments that the Father is required to make to the Mother, including child support and equalization, it also fairly addresses the non-compensatory aspects of the Mother's support claim.

[49] I reviewing the figures offered by the parties, I find that some of the figures offered by each of the parties are either too low or too high. The Father’s figure of $7,260 per month for the last three months of 2021 are, in my opinion too low, while the Mother’s figure of $22,419 for the first half of 2022 is too high.

[50] In exercising my discretion and in light of all of the factors relied upon in my trial decision, I will not make any adjustment to the spousal support already paid in 2021 and 2022. While the $14,000 per month figure was imperfect, it was fair and adequate to meet the factors that should go into the determination of spousal support.

Post Separation Adjustments

Accrued Interest on the HELOC

[51] The Mother agreed to pay $100,000 towards the HELOC in order to settle the issue of the parties’ contributions to that debt. The Father now wants her to pay a percentage of the interest on the HELOC. He offers an intricate calculation setting out his view of the propriety of asking her to pay more of the HELOC than he agreed she would pay.

[52] The Mother says that the Father is seeking to “double dip” by having her pay a percentage of a debt that the Father alone incurred and which he used to effectively pay family expenses when he had by far the greater income.

[53] I agree with the Mother that, as presented to me, their bargain was that she would pay $100,000 towards the HELOC. It was not $100,000 plus a percentage of the interest.

[54] Further, to the extent that the equities of the situation apply, I agree with the submissions made by the Mother at paras. 33-35 of her written submission.

Carrying Costs of the Matrimonial Home

[55] The Father seeks reimbursement for other expenses that he paid after the parties’ HELOC maxed out. They were counselling, insurance, maintenance of the Mother’s car and home expenses. Taken together they total $16,290. While the Father provided no evidence of the payments, they are set out in his spreadsheet. He argues that the Mother failed to provide evidence that his calculations were incorrect or provide her own alternative evidence.

[56] As set out above with regard to other expenses that the parties seek to prove without real evidence, a spreadsheet, in the absence of an agreement or admission, is not proof of an expense. It was open to the Father to offer proof of the expenses by way of receipts, credit card and/or bank statements and the like. He also could have relied on a request to admit. He did not do so. In the face of the Mother’s denial, and lacking better evidence, I am not willing to either reopen the evidence or find that this spreadsheet is sufficient evidence to prove these claims.

Order

[57] In sum, I order as follows:

1. The current annual s. 7 expenses for the children shall include all items set out below, with their current cost as of October 2022 as follows: a. A.: HSC tuition: $31,521 b. B.: HSC tuition: $31,521 c. A. and B.: activities including soccer (including coaches and private lessons), gym, AI, flute: $6,000 d. A. and B.: tutoring, Study.com, Licharts, Brittanica, Enotes etc.: $5,000 e. A. and B.: Inception cord blood storage: $168 f. A. and B.: Medical and Dental Costs: $5,316 Total Net Annual Amount: $79,526 Total Monthly Amount: $6,627.17 per month
2. The parties may incur these expenses without the prior consent of the other, whether the actual costs incurred are more or less than was the case in October 2022.
3. In addition, the parties shall consult with one another regarding any further section 7 expenses as they may arise from time to time.
4. The parties shall reconcile all s. 7 expenses on a monthly basis or as otherwise agreed and each shall promptly pay to the other the money owed.
5. Effective January 1, 2023 the proper ratio of s. 7 payments is 69.4% for the Father and 30.6% for the Mother. This amount shall be adjusted annually, based upon the actual income for the Father and the imputed income for the Mother.
6. The children’s s. 7 university expenses shall include tuition, tutoring, residence or accommodation expenses, books, lab fees, technology needs, meal plans or food.
7. Any other s. 7 expenses must be reasonable and agreed upon in advance. In that regard, the Father shall be presented with a proposed budget of expenses for each child, in advance of that child entering university and each year of university thereafter.
8. The parties will equally divide their RESP account for the children, if they have not already done so. Each party may apply their half of the children’s RESP towards their contributions to the children’s university expenses.
9. In order to secure his support obligations, the Father will maintain a policy of life insurance with a face value of $2.1 million, naming the Mother as the irrevocable beneficiary until he is no longer required to pay child or spousal support. The face value of that insurance policy may be reduced by $200,000 every two years.
10. Neither party owes any money to the other for the retroactive over or underpayment of spousal support.
11. The Father owes the Mother $30,000 in spousal support underpayments for 2023.

Costs

[58] By my reckoning, there was mixed success across the range of issues that were argued at trial. While the Mother was mainly successful in regard to parenting issues, she was not completely successful and her success was not based on many of her basic arguments regarding the Father. Further, both in my trial endorsement and this one, the results regarding the financial issues were divided.

[59] The parties should attempt to resolve the issue of costs on their own. If they are unable to do so, each party may submit their costs submissions of up to five pages, double-spaced, one-inch margins, plus a bill of costs/costs outline and offers to settle, within 30 days. If I require any responding or oral submissions, I will inform them.

[60] If I have not received any submissions within the time frame set out above, I will assume that the parties have resolved the issue and will make no costs order.

Marvin Kurz J. Released: October 25, 2023

[1] As in my trial endorsement, to protect the identities of the children, I refer to each of them by a letter unrelated to their actual names.

[2] In saying this, I recognize the increased discretion that applies to the determination of table child when the payor’s annual income exceeds $150,000 (Child Support Guidelines, s. 4) and for spousal support when the payor’s annual income exceeds $350,000 (SSAG ch. 3.3.7, 11.1, and 11.3).