DATE: 20041012

DOCKET: C41562

COURT OF APPEAL FOR ONTARIO

RE: BARBARA HANNA (Applicant/Appellant in Appeal) -and- BRENDAN HANNA (Respondent/Respondent in Appeal)

BEFORE: McMURTRY C.J.O., MacPHERSON and ARMSTRONG JJ.A.

COUNSEL: Thomas G. Bastedo, Q.C. for the appellant

Mark P. Shelston for the respondent

HEARD: October 7, 2004

RELEASED ORALLY: October 7, 2004

On appeal from the endorsement of Justice Bernard Joseph Manton of the Superior Court of Justice, sitting without a jury, dated February 27, 2004.

E N D O R S E M E N T

[1] The motion judge’s order varying amounts owed by the respondent to the appellant under the terms of a separation agreement was based largely on the respondent’s income figures for the years 2000 to 2003 as follows:

2000 $209,880.55

2001 $547,459.07

2002 $531,591.00

2003 $ 48,000.00

[2] In para. 8 of his endorsement, the motion judge concluded:

There is no doubt that a decrease in income from over $500,000.00 to $48,000.00 per annum is a material change in circumstances. This drop in income was caused by no fault of the Applicant but by the fact that the technology companies in Ottawa experienced a serious economic downturn. No one including the Applicant could anticipate such difficulties at the time that the separation agreement was negotiated and signed and whether it was or [was] not enforceable at the time is of no consequence in this case because paragraph 7 of the separation agreement says that the parties agree that a material change in circumstances may include foreseeable or unforeseeable, foreseen or unforeseen circumstances and that any of these may give rise to an application to vary.

[3] The figure for 2003 is demonstrably wrong. The financial statements of the respondent’s real estate company demonstrate that the respondent’s income for 2003 was at least $207,000.00.

[4] In our view, the essential basis for the motion judge’s order is therefore without foundation. While a decline in income from $531,591.00 to $207,000.00 is not insignificant, we are of the view that it does not provide a sufficient basis for a variation of the amounts owing under the separation agreement given that the agreement was signed a few months before the application was made and given the cyclical nature of the real estate market in which the respondent has been very successfully employed for many years.

[5] The appeal is therefore allowed. The order of Manton J. is set aside. The appellant is entitled to her costs of the appeal fixed at $5,000 including disbursements and Goods and Services Tax. There will be no order as to costs before Manton J.

“Roy McMurtry C.J.O.”

“J.C. MacPherson J.A.”

“Robert P. Armstrong J.A.”