Court File and Parties

Court of Appeal for Ontario Date: 20240315 Docket: COA-23-CV-0606

Judges: Trotter, Zarnett and Sossin JJ.A.

Between: Elena Frenkel Applicant (Appellant)

And: Vsevolod Frenkel Respondent (Respondent)

Counsel: Elena Frenkel, acting in person Vsevolod Frenkel, acting in person

Heard: March 1, 2024

On appeal from the order of Justice Melanie Kraft of the Superior Court of Justice, dated May 2, 2023, with reasons reported at 2023 ONSC 2682.

Reasons for Decision

[1] The issues on appeal arise from the equalization of net family properties following marriage breakdown. The appellant appeals the trial judge’s order that she pay the respondent $210,665.48 comprised of an adjusted equalization payment of $233,363.02, less certain amounts for arrears of child support and s. 7 expenses.

[2] The equalization payment issue, and others, were litigated over the course of an eight-day trial. The main property issue at trial was which party took from their apartment $314,945.25 in precious metals and $60,000 in cash. The respondent stored these items in a large safe in his bedroom and in two other, smaller safes. Each party claimed that the other was responsible for removing these items from the apartment.

[3] After reviewing the conflicting evidence on this issue, the trial judge found on a balance of probabilities that the appellant “retained the balance of the precious metals and the cash that was in the apartment.”

[4] The trial judge found that, after revising the appellant’s net family property financial statement to accurately reflect the amount of the cash she had retained, as well as money in an undisclosed BMO account, the appellant would owe the respondent an equalization payment of $23,918.79. She then considered other post-separation adjustments at para. 127 of her reasons, the most significant of which was an adjustment for the precious metals, in respect of which she said: “[The appellant] [is] to reimburse [the respondent] for the precious metals I find her to have kept after V-date. The parties agree the total value of the precious metals on V-date was $314,945. [The appellant’s] sworn [financial statement] sets out that she retained $82,867.78, leaving a balance of $232,077.47.”

[5] The trial judge then added $232,077.47 to the amount that the appellant was to pay the respondent. After other post-separation adjustments for matters unrelated to the precious metals, she arrived at an adjusted equalization payment owing by the appellant of $233,363.02. She ordered that amount paid by the appellant to the respondent, less amounts for child support and arrears of s. 7 expenses that the respondent owed to the appellant, which reduced the total payment to $210,665.48.

[6] The appellant raises three arguments. First, she submits that the trial judge improperly engaged in a criminal investigation and found her guilty of theft. Second, the appellant challenges the trial judge’s conclusion that she retained or removed the disputed items from the apartment. Third, the appellant submits that the trial judge made a mathematical error in the final calculation of the adjusted equalization payment. The appellant contends that even if the trial judge was right to find that the appellant retained all of the precious metals, the post-separation adjustment arising from this was more than it should have been.

[7] We reject the appellant’s first two grounds of appeal.

[8] First, the trial judge was not engaged in a criminal investigation. The appellant was not found guilty of “theft”. In addressing the equalization of net family property and the required post-separation adjustments, the trial judge was required to determine which party retained which assets. Although the factual background of this case may have been somewhat unique, the trial judge was engaged in a routine task of family law judges – tracing the assets of the parties in the determination of net family property. She did not exceed her jurisdiction in doing so. We dismiss this ground of appeal.

[9] Second, we see no error in the trial judge’s resolution of the factual dispute. As she noted in her reasons, the case turned on the credibility of the witnesses. Credibility findings of a trial judge must be afforded substantial deference on appeal unless an appellant can demonstrate a material misapprehension of the evidence, an error in principle, or that the findings are clearly unreasonable. The appellant has not demonstrated any such deficiency in the trial judge’s findings on this issue. We dismiss this ground of appeal.

[10] Turning to the third ground of appeal, we agree with the appellant that the trial judge made an error in the calculation of the amount of the post-separation adjustment arising from her finding that the appellant had retained the precious metals.

[11] The trial judge found that the parties jointly owned precious metals in the amount of $314,945.25 as of the valuation date. Accordingly, each was entitled to one-half the value of that property. The trial judge noted that the appellant had claimed in her own statement of post separation adjustments that she had retained only a portion of the precious metals worth $82,867.78, and she coupled that with her claim that the respondent had taken the balance (which, if accurate, would have given rise to a post-separation adjustment in the appellant’s favour). But the trial judge found the appellant in fact retained all the precious metals. The trial judge correctly held that this required a post-separation adjustment in favour of the respondent. The calculation of the appropriate amount of this adjustment, however, was incorrect.

[12] In her net family property statement, the appellant attributed half of the value of the precious metals, namely $157,472.50, to each party. The trial judge used the appellant’s net family property statement as the basis for correctly calculating a revised equalization payment of $23,918.79, [1] before adjustment for the fact that the parties had not retained equal amounts of the precious metals. [2] The required adjustment was the amount necessary to ensure each actually received one half the value of the precious metals—that is $157,472.50.

[13] The trial judge calculated the adjustment in favour of the respondent to be $232,077.47 (the difference between what the appellant said she had retained and the value of all the precious metals), but this gave the respondent more than one-half of their value. The appropriate post-separation adjustment in relation to the precious metals was a payment by the appellant to the respondent of 50% of the total value of the precious metals the appellant was found to have retained, in the amount of $157,472.50.

[14] Partially offsetting this error which the trial judge inadvertently made in favour of the respondent, are two additional smaller errors in the calculation. These, the respondent correctly points out, were errors in favour of the appellant. The trial judge mistakenly deducted the amounts for their joint BMO accounts and the Effective Technologies bank account, $1,689.13 and $3,073.04 respectively, from the amount the appellant owed the respondent when in fact she had identified them as additional amounts owing from the appellant to the respondent. They should have increased the amount payable by the appellant.

[15] Correcting each of these errors, the amount of the equalization payment to be paid by the appellant to the respondent after giving effect to post separation adjustments is not $233,363.02 as the trial judge found at para. 128 of her reasons, but rather $168,282.39.

[16] Accordingly, the appeal must be allowed and para. 8 of the trial judge’s order varied to the extent of (i) substituting $168,282.39 [3] as the amount of the adjusted equalization payment, and (ii) given that the amounts owing for the child support and s. 7 expense arrears remain unchanged, substituting $145,584.85 [4] as the net amount of the equalization payment the appellant must pay after deduction for arrears of child support and s. 7 expenses.

[17] The respondent filed a very late motion for an order that the appellant be enjoined from dissipating any of her assets. He also sought an order for security for costs. There is no basis to grant any of the requested relief. The motion is dismissed.

[18] Both parties were self-represented on appeal. Neither sought to recover their costs. There will be no costs order.

“Gary Trotter J.A.” “B. Zarnett J.A.” “L. Sossin J.A.”

[1] At paras. 125 and 126 of her reasons.

[2] The $82,867.78 that the appellant admitted retaining was not reflected in the net family property statement itself. That number was only reflected in the appellant’s own table of post-separation adjustments, which the trial judge created afresh at para. 127 based on her own findings.

[3] In place of the sum of $233,363.02.

[4] In place of the sum of $210,665.48.