Court of Appeal for Ontario

Date: 20220531 Docket: C67780

Judges: Benotto, Zarnett and Copeland JJ.A.

Between: Michelle McGuire Applicant (Appellant/ Respondent by way of cross-appeal)

And: Michael Bator Respondent (Respondent/ Appellant by way of cross-appeal)

Counsel: Michelle McGuire, acting in person Andrew Morrison and Mercedes Sretenovic, for the respondent

Heard: May 11, 2022

On appeal from the judgment of Justice M. Suranganie Kumaranayake of the Superior Court of Justice, dated November 12, 2019 and from the costs order, dated June 4, 2020.

Benotto J.A.:

[1] Michelle McGuire and Michael Bator were involved in a romantic relationship when Ms. McGuire moved with her nine-year-old son Mason into Mr. Bator’s home. They cohabited for five years during which time Ms. McGuire became disabled by illness. When the couple separated, Ms. McGuire claimed support for herself and for Mason and a constructive trust interest in Mr. Bator’s home. The appellant is currently 51 years old and the respondent is 56.

[2] The trial judge ordered a lump sum payment of spousal support in the amount of $12,248, which she described as “spousal support on the mid-range of the Spousal Support Advisory Guidelines, calculated from January 1, 2018 to June 30, 2020”, and dismissed the other claims. She declined to order costs to either party.

[3] Ms. McGuire appeals the decision with respect to child and spousal support and the constructive trust interest in the home. Mr. Bator cross-appeals the decision on costs.

[4] For the reasons that follow, I would allow the appeal in part and order periodic support to be paid in addition to the lump sum awarded by the trial judge for spousal support. I would dismiss the cross-appeal.

Background

[5] The appellant and her son Mason were living in her condo in Mississauga when she met the respondent in September 2012. Mason’s biological father has not been involved in his life and has paid no child support despite being ordered to do so.

[6] The respondent has three children from previous relationships: two biological children, Marshall who was 18 at the time and Taylor who was 7, and a stepson Jamey who was then 26. The respondent considered himself a father to Jamey. The respondent and Taylor were living in a home he purchased with Taylor’s mother.

[7] Gradually the relationship between the parties progressed and the couple had their children spend time together to be sure they got along.

[8] On January 1, 2013, the appellant moved into the respondent’s home with Mason. [1] Mason was enrolled in the same school as Taylor. They lived as a family with the appellant looking after the household chores and caring for Mason and Taylor when he was not with his mother. She also maintained her job in Mississauga. In February 2014, the appellant left her job and took a job in Oakville. The respondent continued his work as a self-employed software engineer.

[9] In 2015, the appellant sold her condo and used the net proceeds for household expenses including installing new windows in the respondent’s home.

[10] In 2016, the appellant fell ill and was hospitalized for three weeks. She was diagnosed with spontaneous intracranial hypotension and was no longer able to work. She was designated “disabled” by Canada Pension Plan and as of the date of trial her only source of income was her disability payment of about $1,200 per month.

[11] Following her illness, the respondent became frustrated with the appellant’s inability to continue living as she had before. He testified that his children complained to him about the appellant. He asked her to leave. On February 2, 2018, he provided the appellant with an ultimatum: either she signed a contract to perform household services and pay him rent of $1,250 retroactive to October 2017, or she would be evicted as a trespasser. If she signed the contract and abided by the terms, she could stay until June. She objected to the contract.

[12] Six days later, on February 8, 2018, he gave her a document entitled “Trespass Notice and Eviction” requiring her to leave within four days, by February 12, 2018. Having nowhere to go and being unable to work, she could not leave. On February 13, 2018, the respondent called the police to remove her. Mason was at school. She had no time to properly pack their belongings. The respondent relied on this eviction to demonstrate that he had no parental role with Mason. His affidavit sworn for trial purposes said:

The decision to evict the [appellant] and Mason from my home without contemplating the impact it would have on Mason, in my opinion, further demonstrates that I did not view Mason as my son.

[13] The respondent has had no contact with Mason since.

[14] The appellant then pursued her claim for child and spousal support and an interest in the respondent’s home.

Decision Below

[15] After a seven-day trial, the trial judge concluded that:

1. The appellant was not entitled to child support because the respondent did not have a settled intention to treat the child as his own.
2. The appellant was entitled to spousal support on a needs basis because she was unable to work due to health difficulties. The trial judge ordered lump sum support for the period January 1, 2018 to June 30, 2020.
3. The claim for a constructive trust interest in the home was dismissed.
4. Because success was divided, the trial judge did not order costs.

Analysis

[16] For the reasons that follow, I would dismiss the appellant’s appeal with respect to child support and the constructive trust interest in the home. However, I conclude that the trial judge erred in law in her determination of spousal support and would allow the appeal in part. I would dismiss the cross-appeal with respect to costs of the trial.

(1) Child support

[17] To establish an entitlement to child support, the appellant has the onus to prove that the respondent exhibited a settled intention to treat the child as his own. The long-standing factors for the court to consider are set out in Chartier v. Chartier, [1999] 1 S.C.R. 242, at para. 39:

The relevant factors in defining the parental relationship include, but are not limited to, whether the child participates in the extended family in the same way as would a biological child; whether the person provides financially for the child (depending on ability to pay); whether the person disciplines the child as a parent; whether the person represents to the child, the family, the world, either explicitly or implicitly, that he or she is responsible as a parent to the child; the nature or existence of the child’s relationship with the absent biological parent. The manifestation of the intention of the step-parent cannot be qualified as to duration, or be otherwise made conditional or qualified, even if this intention is manifested expressly.

[18] The trial judge referred to Chartier and set out her findings in this regard:

• The parties did not share a bank account and did not pay for Mason’s expenses from that account;
• The respondent expected the appellant to pay him back for Mason’s expenses;
• The respondent did not discipline Mason and was not involved in Mason’s bedtime routine;
• Mason did not call the respondent Dad, but addressed him by his first name;
• The respondent did not introduce Mason as his son, but rather as the appellant’s son; and
• The respondent treated Mason differently from his own children. He was much more involved in the day-to-day activities of Marshall, Jamey and Taylor.

[19] These findings were open to the trial judge on the evidence and there is no basis for appellate intervention.

[20] I would therefore dismiss this ground of appeal.

(2) Constructive trust interest in the home

[21] The appellant submitted that the respondent was unjustly enriched because she paid for new windows to his home ($15,705) and gave him $65,000 after the sale of her condo. She submits that the respondent used the money to pay off the loan for a vehicle purchased for her in 2014 and to pay down a line of credit. The respondent argued that once the appellant moved in, she needed help paying her mortgage and expenses, and that the appellant agreed to pay him back once she sold her condo.

[22] Although the trial judge found the appellant was generally a more credible witness, she accepted the respondent’s evidence that the $65,000 was a repayment. She also found that there was no unjust enrichment since the appellant did not provide evidence that the home improvements increased the value of the home.

[23] These are findings of fact that were open to the trial judge. Again, I see no basis to intervene and would dismiss this ground of appeal.

(3) Spousal support

[24] The trial judge made a finding that the appellant had a needs-based entitlement to spousal support because of her disability. She awarded her a lump sum payment to “permit the parties to move on with their lives”. With respect to both quantum and duration, the trial judge relied on the basic SSAG formula inputted into a software programme. Based on the parties’ income figures, their ages, and a cohabitation period of five years, the mid-range monthly support was $620 and the duration was anywhere from two-and-a-half years to five years. The trial judge chose the mid-range quantum, but the lowest-end duration. The support was then converted to the lump sum amount of $12,248.

[25] There are several problems with this approach: (i) there was no analysis of how the award achieved the objectives of spousal support; (ii) there was no explanation of why, in the case of an ill and disabled spouse unable to work, a mid-range support amount for the lowest duration was appropriate; and (iii) a lump sum to achieve a clean break was not appropriate in the circumstances.

[26] I will address each of these in sequence.

(i) No analysis of how the award achieved the objectives of spousal support

[27] The trial judge provided no analysis as to whether the award achieved the objectives of spousal support. The objectives for needs-based spousal support (as opposed to compensatory-based) are set out in Bracklow v. Bracklow, [1999] 1 S.C.R. 420, at para. 46:

Following Moge’s broad view of causation in compensatory support and the concomitant acceptance of the availability of non-compensatory support, courts have shown increasing willingness to order support for ill and disabled spouses. Sometimes they have done this as a “transition” to self-sufficiency. But more often, they have frankly stated that the obligation flows from the marriage relationship itself. Collecting cases, Rogerson explains in “Spousal Support After Moge”:

The [more dominant] approach, ... particularly in cases of earning capacity permanently limited by age, illness or disability, and the one generally supported by the developing Court of Appeal jurisprudence, has been to award continuing support without regard to the source of the post-divorce need. On this approach, which I earlier referred to as the “basic social obligation” approach, causal connection arguments have been rejected not only in determining entitlement to support, but also in assessing the extent of the obligation. The message coming from the cases adopting this approach appears to be that one takes one’s spouse as one finds him or her, subject to all his or her, weaknesses and limitations with respect to income-earning capacity; and a spouse with higher earning capacity has a basic obligation to make continuing provision for a spouse who is unable to become self-sufficient at the end of the marriage. One is simply not allowed to abandon a spouse to destitution at the end of a marriage if one has financial resources which might assist in relieving the other spouse’s financial circumstances. [Emphasis in original; citations omitted.]

[28] The evidence here was that the appellant’s disability would continue. The trial judge specifically accepted at para. 49 that, “following her diagnosis of Spontaneous Intracranial Hypotension, [the appellant] has been unable to work”. Yet the trial judge ordered spousal support at only the mid-range of the amounts suggested by the SSAG formula, and at the lowest end of duration from the date of separation. There was no explanation as to why the support terminated when the need clearly continued.

[29] As stated by this court in Gray v. Gray, 2014 ONCA 659, 122 O.R. (3d) 337, at para. 49, “[t]he duration of support is also an issue that ought to be contemplated under the SSAG”. For support to terminate there must be a realistic prospect of the spouse being able to become self sufficient: Reisman v. Reisman, 2014 ONCA 109, 118 O.R. (3d) 721, at para. 28. This court has upheld an indefinite support order in the case of ongoing need due to disability (Gray) and has overturned a time limit for support for a disabled spouse (Djekic v. Zai, 2015 ONCA 25, 54 R.F.L. (7th) 1, at para. 9).

[30] Here the appellant remains disabled and unable to support herself. She lives on government disability payments. There is no evidence that her situation had changed or will change in the future.

[31] One of the purposes of a spousal support order is to relieve financial hardship; another is for a former spouse to fulfil a basic social obligation to provide support where they are able to do so and the recipient spouse is not. Nothing in the trial judge’s reasons explains how the termination of support after only two-and-a-half years achieves these or other objectives of spousal support.

(ii) Reliance on SSAGs

[32] The trial judge’s choices with respect to the basic SSAG formula required explanation. But she also appears to have ignored the explicit exception in the event of disability. As stated in the SSAGs at Chapter 12, “[t]he formulas are intended to generate appropriate outcomes in the majority of cases”. Illness and disability, discussed at s. 12.4, often require “restructuring” of duration and/or quantum.

[33] The SSAGs are an excellent advisory guideline for typical cases. They assist in achieving consistency and predictability. They are not a substitute for judicial analysis, particularly in exceptional cases.

[34] The trial judge erred in failing to explain her choices and in failing to engage explicitly with the exceptional circumstances of illness and disability that she found as facts. Consideration was required as to whether the circumstances of illness and disability should result in a departure from the basic formula.

(iii) Lump sum

[35] In addition, in converting the limited term support award to a lump sum to achieve a clean break, in my view the trial judge misunderstood the notion of a clean break. Without further explanation it is difficult to see how a clean break, which is normally appropriate only for compensatory support (see Bracklow, at para. 25) applies to needs-based support arising from disability.

Conclusion as to Spousal Support

[36] For these reasons, I would allow the appeal in part. In addition to the $12,248 ordered by the trial judge to cover the period from January 1, 2018 to June 30, 2020, I would order continuing periodic support payable to the appellant in the monthly amount set by the trial judge, namely $620, indexed annually as required by the SSAGs, in accordance with s. 34(5) of the Family Law Act, R.S.O. 1990, c. F.3. I would order this periodic support to continue for an indefinite duration subject to review based on any material change in circumstances. I would order this periodic support to commence May 1, 2022. I would not order any support retroactive to June 2020 because the appellant did not expeditiously pursue the appeal.

[37] In summary, in addition to the amount ordered by the trial judge for spousal support, the respondent is to begin paying monthly support in the amount of $620 as of May 1, 2022.

Cross Appeal: Costs

[38] The respondent seeks leave to cross-appeal costs.

[39] I will address the respondent’s submissions, but first I provide background on the law with respect to costs in family law as summarized by this court in Fielding v. Fielding, 2015 ONCA 901, 129 O.R. (3d) 65 at paras. 67-69:

• Costs awards are “quintessentially discretionary”;
• A costs award should only be set aside on appeal if the court below “has made an error in principle or if the costs award is plainly wrong”;
• There is “significant deference” to costs awards in relation to spousal support orders. This approach promotes finality in family law litigation.
• A material error, a serious misapprehension of the evidence or an error in law would be required for this court to intervene.

[40] The Family Law Rules, O. Reg. 114/99 emphasize these principles in r. 24(12), which contains a list of factors the court shall consider and balance subject to its overriding discretion. The court may exercise its discretion to award costs. Rule 24(1) creates a presumption that a successful party will be granted costs. At the same time, r. 24(4) gives the court the discretion to deprive a successful party of “all or part of” his or her costs if the party behaved unreasonably. Likewise, r. 24(6) gives courts discretion to apportion costs when success is divided. This is in contrast to r. 24(8), which requires the court to order full recovery of costs upon making a finding of bad faith.

[41] The intention of the rules is clear: absent bad faith, the ultimate decision rests with the trial judge.

[42] The respondent focused his submissions on the outcome of the trial and his offers to settle. This ignores the discretionary aspect to costs. It also misses one important aspect of r. 24: the trial judge’s analysis of the reasonableness of a party’s conduct. Here, the trial judge made specific reference to the respondent’s “callous” conduct in “evicting” the appellant and her son from the home. She found the respondent’s behaviour was unreasonable, both with respect to his original position on the length of cohabitation and the manner in which the appellant and Mason were forced from the home.

[43] The trial judge also found that the respondent’s behaviour was unreasonable in taking the position that the appellant was not entitled to any support.

[44] In denying the respondent his costs, the trial judge was exercising her discretion under r. 24(4) to deny a party who has behaved unreasonably all or part of their costs.

[45] While I could end the analysis here, I now address the specific basis for the cross-appeal.

[46] The respondent submits that the “no costs” order by the trial judge was unreasonable because: (i) although the trial judge said that success was divided, he was the successful party; (ii) the appellant failed to make an offer to settle; and (iii) she failed to accept his offers which were more advantageous to her than the ultimate award.

[47] I address these points sequentially.

(i) That the respondent was the more successful party

[48] The respondent submits that he succeeded on the child support and the constructive trust claims. However, the trial judge said on more than one occasion that she found the appellant more credible than the respondent. This finding factored into her determination of the length of cohabitation, which favoured the appellant. Further, the trial judge found his position on spousal support to be unreasonable and this alone supported her decision to deny him costs.

(ii) That the appellant failed to make an offer

[49] This court has confirmed that there is no obligation on a party to provide an offer to settle. In Beaver v. Hill, 2018 ONCA 840, 143 O.R. (3d) 519, at para. 15, Nordheimer J.A. stated: “Although I accept that the presence or absence of offers to settle can properly be taken into account in fixing costs, it remains the fact that the appellant was not under any obligation to proffer an offer to settle.”

[50] The respondent relies on a party’s obligation under r. 17 to file an offer to settle prior to the trial management conference. This requirement is for the purposes of the conference. Had the trial management judge considered it significant, costs would have been dealt with at the conference. It does not limit the broad discretion of a trial judge.

(iii) That he made offers more advantageous than the final award

[51] The respondent relies on r. 18. But again, he misunderstands the rule. Rule 18(14) provides that a party who makes an offer is entitled to costs “unless the court orders otherwise”. And r. 18(16) provides that when a court exercises its discretion over costs, “it may” take offers into account.

[52] Here, the trial judge directed herself in accordance with the rules and exercised her discretion to order no costs. I see no misapprehension of fact or error of law that would require interference with this discretionary decision.

Conclusion

[53] I would allow the appeal in part by adding a monthly spousal support payment of $620 to commence on May 1, 2022, indexed annually in accordance with s. 34(5) of the Family Law Act.

[54] I would dismiss the cross-appeal.

[55] I would order no costs of the appeal or of the cross-appeal.

Released: May 31, 2022 “M.L.B.” “M.L. Benotto J.A.” “I agree B. Zarnett J.A.” “I agree J. Copeland J.A.”

[1] The dates of cohabitation were disputed at trial. The trial judge made findings as to the date the cohabitation began and ended. They are not challenged on appeal.