Tauber v. Tauber

[Indexed as: Tauber v. Tauber]

64 O.R. (3d) 229

[2003] O.J. No. 1083

Docket No. C36925

Court of Appeal for Ontario

Catzman, Abella and Charron JJ.A.

March 31, 2003

Family law -- Support -- Spousal support -- Lump sum -- Trial judge not erring in ordering lump sum spousal support of $500,000 in favour of wife after 18-month marriage -- Wife's earning capacity impaired by marriage and parenting responsibilities -- Periodic payment would be less conducive to creating self-sufficiency -- Lump sum enhancing wife's economic self-sufficiency and operating as one-time form of compensation to [page230] enable her to acquire more permanent residence for herself and child -- Amount of award not unreasonable in light of husband's income and assets.

The parties' marriage lasted 18 months. They had one child. Before the marriage, the wife was earning over $60,000 and her income was increasing steadily. The husband was a businessman with an estimated annual income of $2.5 million and a net worth of between $19 and $20 million. The division of property was governed by a marriage contract. The wife received $100,000 in lieu of any assets, an amount which did not cover her legal fees. The trial judge awarded the wife $500,000 as a lump sum for spousal support. The trial judge's express goal was to fashion a support order designed to promote the wife's economic self-sufficiency. The husband appealed.

Held, the appeal should be dismissed.

The evidence supported the trial judge's conclusion that the wife's earning capacity was impaired by the marriage, her parenting responsibilities and the breakdown of the marriage. Despite the brevity of the marriage, the wife was in need of economic support as a consequence of the marriage. The short duration of the marriage was a relevant factor and militated against an ongoing obligation for support. Periodic payments would be less conducive to creating self-sufficiency for the wife. A lump sum could enhance her economic self-sufficiency and operate as a one-time form of compensation to enable her to buy a house and establish residential roots for herself and her child in a manner that would better approximate the lifestyle the child enjoyed while living with both parents. While the amount ordered was, objectively, substantial, it was not unreasonable in light of the husband's assets, his undisputed ability to pay and the parties' lifestyle during the marriage.

APPEAL by a husband from a lump sum spousal support order.

Cases referred to Tauber v. Tauber (2000), 48 O.R. (3d) 577, 187 D.L.R. (4th) 1, 6 R.F.L. (5th) 442 (C.A.), supp. reasons (2000), 51 O.R. (3d) 81, 8 R.F.L. (5th) 441 (C.A.), revg (1999), 43 O.R. (3d) 42, 90 O.T.C. 274 (Gen. Div.), (1999), 43 O.R. (3d); Willick v. Willick, [1994] 3 S.C.R. 670, 125 Sask. R. 81, 119 D.L.R. (4th) 405, 173 N.R. 321, 81 W.A.C. 81, 6 R.F.L. (4th) 161 Statutes referred to Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.), s. 15.2(4)

Rodica David, Q.C., and Michael F. Charles, for respondent. Tom Bastedo, Q.C., and Samantha Chousky, for appellant.

[1] BY THE COURT: -- The issue in this appeal is the propriety of an order requiring a lump sum payment for spousal support.

[2] Michelle Tauber and Jeffrey Earl Tauber met in March 1995, married on May 17, 1996 and decided to separate in December 1997. Their marriage lasted 18 months. They had one child, Sam, who was born on August 5, 1997.

[3] Ms. Tauber worked as a freelance wardrobe and prop stylist for photo shoots and commercials for eight years before her [page231] marriage and until her pregnancy. Her annual income by the time she got married was over $60,000 and was increasing steadily.

[4] Mr. Tauber is a businessman with an estimated annual income of $2.5 million. He has a net worth of between $19 to $20 million.

[5] The parties entered into a marriage contract whereby they agreed that any property would be divided according to ownership. This meant that when the parties separated, Mr. Tauber retained the matrimonial home, worth $2.8 million. The contract also provided that if the marriage broke down in the first three years and there were children, Ms. Tauber's right to receive spousal support would be determined by the parties or, failing agreement, by a court. In May 1998, just after the separation and in accordance with the grid set out in the contract, Ms. Tauber received $100,000 in lieu of any assets. The parties were unable to agree on spousal support.

[6] The parties have already previously litigated custody and support (Tauber v. Tauber (1999), 43 O.R. (3d) 42, 90 O.T.C. 274 (Gen. Div.); (1999), 43 O.R. (3d) 53; (2000), 48 O.R. (3d) 577, 187 D.L.R. (4th) 1; (2000), 51 O.R. (3d) 81, 8 R.F.L. (5th) 441 (C.A.)). In the last of these decisions, the Court of Appeal ordered a retrial of the support issues.

[7] At the retrial, the trial judge ordered Mr. Tauber to pay $11,173 monthly in child support to Ms. Tauber, the amount stipulated by the Child Support Guidelines. Mr. Tauber has abandoned his appeal from that order.

[8] The issue in this appeal is the trial judge's decision to award Ms. Tauber $500,000 as a lump sum for spousal support. The standard of review is undisputed and was confirmed in Willick v. Willick, [1994] 3 S.C.R. 670, 119 D.L.R. (4th) 405, at p. 744 S.C.R.:

As far as the applicable standard of appellate review is concerned I am of the view that we should not interfere with the trial Judge's decision unless we are persuaded that his reasons disclose material error and this would include a significant misapprehension of the evidence, of course, and, to use familiar language, the trial Judge's having "gone wrong in principle or (his) final award (being) otherwise clearly wrong": Attwood v. Attwood, [1968] P. 591, at p. 596. In other words, in the absence of material error, I do not think that this Court has an "independent discretion" to decide afresh the question of maintenance and I say this with due respect for decisions to the contrary: see, e.g., Piller v. Piller (1975), 54 D.L.R. (3d) 150, [1975] 4 W.W.R. 342, 17 R.F.L. 252 (B.C.C.A.), and Carmichael v. Carmichael (1976), 69 D.L.R. (3d) 297, 27 R.F.L. 325 (B.C.C.A.).

(Emphasis added in Willick) [page232]

[9] Mr. Tauber's position was that there should be no spousal support given the length of the marriage. He argued that Ms. Tauber suffered no economic hardship from the marriage, enjoying a far superior lifestyle than before the marriage. If there were a support entitlement, he argued that it should not take the form of a lump sum but rather periodic support limited to three years, the length of the marriage and therefore the length of the disadvantage. In the alternative, if this court accepts the propriety of a lump sum award, he disputes the quantum.

[10] In reaching her conclusion that a lump sum was appropriate, the trial judge applied the factors in s. 15.2(4) of the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.) and concluded that while the "condition, means, needs and other circumstances of Mr. Tauber remain fairly stable, those of Ms. Tauber did not". She noted that Ms. Tauber is a single parent whose earning capacity has been impaired by the marriage and by her parenting responsibilities, and that her financial needs have significantly increased since the marriage due in a large part to the birth of their child.

[11] In addition, after examining the marriage contract, the trial judge concluded that the $100,000 lump sum received by Ms. Tauber was in consideration of the release of property claims, not of any support claims. The entire $100,000 was required by Ms. Tauber for legal fees, which totalled over $200,000.

[12] The trial judge's assessment of Ms. Tauber's financial situation was that she had a net worth of $115,000 at the time of the marriage and the ability to earn $50,000 per year, both of which diminished in the aftermath of the separation. Ms. Tauber received no spousal support from Mr. Tauber for three years. The trial judge noted the extreme disparity between Ms. Tauber's economic circumstances and reduced ability to earn income, and Mr. Tauber's exceptionally robust financial situation.

[13] The trial judge's express goal was to fashion a support order designed to promote the economic self-sufficiency of Ms. Tauber, who started to work part-time in 1998, within a reasonable period of time. Given Ms. Tauber's age and ability to contribute to her own support, she sought to award support in the form that was most conducive to motivating Ms. Tauber's return to the full-time workforce and ensuring her continuing self-sufficiency. She therefore decided that a lump sum payment rather than ongoing periodic support was appropriate.

[14] It is not disputed that Ms. Tauber, who has been living in rental accommodations costing $4,000 to $5,000 monthly and requiring her to move almost annually, seeks to apply the money towards a down payment on a home so that she can [page233] provide residential stability for her child. The trial judge agreed, concluding that Ms. Tauber was entitled to an amount of spousal support that would enable her to provide more permanent living arrangements for Sam. The lump sum, in short, was not only to compensate Ms. Tauber for the consequences of the marriage breakdown, but also to give her some assistance in re- establishing herself in her career as she works increasingly towards more full-time work.

[15] It was open to the trial judge, on this record, to accept Ms. Tauber's submission that rental housing would affect the child's stability and that the purchase of a home was a reasonable financial aspiration on Ms. Tauber's part. In particular, we see nothing inappropriate about awarding a lump sum to provide transitional economic relief to assist Ms. Tauber in promoting her economic self-reliance, a reasonable goal given her age, past work experience and talent.

[16] The evidence supports the trial judge's conclusion that Ms. Tauber's earning capacity was impaired by the marriage, her parenting responsibilities and the breakdown of the marriage. In Sam's interests, she is not able to accept some contracts, particularly those which, while lucrative, involve being away from Toronto. Her career has been, and continues to be, affected by her parenting responsibilities while Mr. Tauber's career and financial consequences have not.

[17] In our view, the trial judge's decision discloses no error either in principle or in law justifying interference with her discretion. While we disagree with her conclusion that the length of the marriage was a neutral factor, we are nonetheless of the view that despite the brevity of the marriage, Ms. Tauber was in need of economic support as a consequence of the marriage and that a spousal support order was therefore justified. The short duration of the marriage is, in our view, a relevant factor and militates against, in these circumstances, an ongoing obligation for support.

[18] We agree that periodic payments would be less conducive in this case to creating self-sufficiency for Ms. Tauber. A lump sum, on the other hand, can enhance her economic self- sufficiency and operate as a one-time form of compensation to enable her to establish residential roots for herself and her child in a manner that would better approximate the lifestyle the child enjoyed while living with both parents, a lifestyle to which Mr. Tauber has the means to contribute.

[19] The trial judge undertook a careful analysis of the applicable principles in the Divorce Act. Notwithstanding an error in her calculation of Ms. Tauber's 1996 income, an error which we [page234] think does not affect the result, the trial judge's lump sum award is, in the circumstances, appropriate; in our view, an ongoing order of spousal support would not have met the objectives of the Divorce Act as appropriately as this award. While the amount ordered is, objectively, a substantial sum, it must be seen in the context of Mr. Tauber's assets which are worth between $19 and $20 million, his undisputed ability to pay and the parties' lifestyle during the marriage. In this light, the amount ordered is not so far beyond what is reasonable as to justify our interference.

[20] The appeal is dismissed with costs. The parties will have until April 15, 2003 to exchange and file their costs submission.

Appeal dismissed.