Court File and Parties

Court File No.: FO-08-43776 and FO-14-72177

Date: 2016-01-21

Ontario Court of Justice

Between:

The Director, Family Responsibility Office for the Benefit of Emma Camposano

Applicant

- and -

Dean Randall Adema

Respondent

And

The Director of the Family Responsibility Office for the Benefit of Demetra Adema

Applicant

- and -

Dean Randall Adema

Respondent

Counsel:

• Diane Gillies, for the Applicant
• Dean Randall Adema, Acting in Person

Both Heard: January 18, 2016

Justice: S.B. Sherr

Reasons for Decision

(Delivered Orally on January 21, 2016)

Part One – Introduction

[1] On January 18, 2016, the court conducted default hearings in these two cases (the Camposano case and the Adema case).

[2] The parties agreed that the cases should be heard together as the respondent's (the payor) ability to pay child support arrears was the central issue in both cases.

[3] The payor was permitted to file financial statements (sworn on January 18, 2015) and copies of his income tax returns on the date of the hearing.

[4] The payor also asked for permission at the hearing to give oral evidence. This was opposed by the applicant (the Director). The Director made a compelling argument in support of its position. The payor had not filed a Dispute or affidavit material in either case, despite having been served with the Notices of Default Hearings in April of 2015 and having been granted several extensions of time by the court to file material. His financial disclosure was inadequate and delivered late. He is a family law lawyer, who should be aware of the importance of filing comprehensive financial information and affidavit evidence in a timely manner.

[5] However, given the seriousness of the relief sought by the Director (immediate committal), the court wanted to ensure that all relevant evidence was before it. The payor was permitted to give oral evidence. The Director was given the opportunity to hold the matter down or adjourn the hearing after the payor testified. The Director chose to proceed with its cross-examination of the payor and the hearing was completed.

[6] The Director seeks default orders that the payor be imprisoned for 90 days in each case, or until such time as he pays all of the outstanding child support arrears. It also seeks an order that the payor be jailed for 3 days for each payment in default for ongoing support accruals in the Adema case.

[7] The payor claims that he does not have the ability to comply with the existing court order for child support in the Adema case or to pay the outstanding support arrears in both cases at this time.

Part Two – The Camposano Case

[8] The payor is the father of a 22-year-old child in the Camposano case.

[9] The payor and Ms. Camposano entered into a paternity agreement on March 15, 2001, requiring the payor to pay child support of $400 per month, based on an annual income of $46,500.

[10] Ms. Camposano filed the agreement with the court on February 18, 2008 in accordance with section 35 of the Family Law Act.

[11] The payor did not voluntarily make any support payments after the agreement was filed with the court. Some minor amounts were diverted from federal sources (such as HST refunds).

[12] Pursuant to the paternity agreement, the child ceased to be entitled to support as of April 8, 2011. The Director adjusted its records in accordance with this agreement. The Director is only enforcing support arrears accumulated up until April 8, 2011.

[13] The payor is presently $15,073.30 in arrears of support.

[14] The payor has never moved to change this agreement or to seek repayment terms for the outstanding arrears.

[15] The Director issued its Notice of Default Hearing in this court on March 9, 2015.

[16] The payor was served on April 15, 2015.

[17] On May 12, 2015, the parties consented to a temporary default order by Justice Carolyn Jones. The order required the payor to commence a motion to change support before the next court date and to serve and file before the next court date:

a) A sworn financial statement and default dispute.

b) His 2012 to 2014 income tax returns and notices of assessment.

c) Proof of all periods that he was in receipt of employment insurance or social assistance since 2011.

[18] The case returned to court on June 23, 2015. The payor had provided his income tax returns from 2011 to 2013, but nothing further. The Director agreed to adjourn the cases until August 25, 2015, to give the payor the opportunity to comply with the balance of the court order.

[19] No further disclosure was provided prior to August 25, 2015 and the Director agreed to another adjournment to give the payor the opportunity to comply with the court order made on May 12, 2015. The payor did not appear on the return date of November 25, 2015. Justice Jones granted an adjournment until January 5, 2016, to permit the payor another opportunity to attend. The payor had still not filed any further financial disclosure.

[20] The payor then brought a Form 14B motion, on January 4, 2016, seeking to adjourn the default hearing due to a scheduled dental procedure. The motion was opposed by the Director. Justice Jones reluctantly (due to the lengthy delay and prior indulgences given to the payor), granted the adjournment peremptory on the payor.

[21] The payor has not made any voluntary payments towards the support arrears since the default proceeding was started.

Part Three – The Adema Case

[22] The payor is the father of two children in the Adema case. These children continue to be eligible for support.

[23] On July 5, 2007, Justice Linhares de Sousa of the Superior Court of Justice (Family Law Branch) in Ottawa made a final order that the payor pay Ms. Adema child support of $800 per month, based on his income of $53,100 per annum.

[24] The payor did not appeal this order. He has never moved to change it.

[25] Ms. Adema did not file the order for enforcement with the Director until November 1, 2013. She did not claim any arrears owing at that time.

[26] The payor has not made a voluntary support payment since the order was filed with the Director. Some amounts have been diverted from federal sources.

[27] The payor is $19,462.99 in arrears in the Adema case.

[28] The Director issued its Notice of Default Hearing on March 9, 2015. The payor was served on April 15, 2015.

[29] The court appearances in the Adema case have mirrored those set out in the Camposano case. This includes the order for the payor to provide financial disclosure, file a Dispute to the Notice of Default Hearing and requiring him to bring a motion to change.

[30] The payor has not voluntarily paid any child support since the default proceeding was started.

Part Four - The Payor's Evidence

[31] The payor is 50 years old.

[32] The payor was called to the Bar as a lawyer in February of 1993. He testified that he operated his own law practice for about a year and a half. He then married, stopped practising, and moved to Greece for about one year.

[33] The payor deposed that he returned to Ottawa in 1997 and operated his own law practice from then until 2006. He practised family, criminal and civil law. It is unclear what the payor did from 2006 to 2008, although his annual income was fixed at $53,100 on July 7, 2007 in the Adema case.

[34] The payor said that he did not practise law from 2008 to 2010. He attempted to support himself as an actor and performed in dinner theatre.

[35] In 2010, the payor said that he went to Korea for a few months to teach English, but this didn't work out.

[36] The payor said that he practised law in Toronto from January to April of 2011 as an associate at a law firm. This too, he said, did not work out.

[37] The payor deposed that he went on welfare in 2012.

[38] The payor testified that he worked at a law firm as an associate in Toronto from October of 2012 until April of 2014. He said that he left the firm to start his own practice. He has been operating his practice, primarily in family and civil litigation law, since then.

[39] The payor testified that he works from a home office and occasionally rents office space to meet with clients. He presently lives with his girlfriend who occasionally helps him with the administration of his practice. He has no other employees.

[40] The payor filed his income tax returns for 2011 to 2014. He did not file any notices of assessment. The payor did not provide any documentation supporting the revenues or expenses contained in his Statements of Business or Professional Activities, attached as schedules to his returns for 2013 and 2014.

[41] The payor's line 150 income in his 2011 income tax return was $19,627.

[42] The payor's line 150 income in his 2012 income tax return was $12,929.

[43] The payor reported gross business income of $68,045 in 2013 and net business income of $31,354.

[44] The payor reported gross business income of $40,322 in 2014 and net business income of $19,070.

[45] The payor deposed that his gross business income for 2015 was $45,118 and his net business income was $22,538.

[46] The payor deposed that he has assets of $239 and that he owes Revenue Canada about $50,000. He has not paid any taxes (including quarterly instalments) since at least 2013.

[47] The payor deposed that his girlfriend earns $30,000 per year as a bank teller. He provided no documentary evidence of her income. He said that she does not contribute to household expenses since she needs to make payments for a property she owns in Brazil and is supporting family in Brazil.

[48] The payor deposed that his driver's licence was suspended by the Director on November 4, 2013. He also said that his passport has been suspended.

[49] The payor testified that he was surprised that the Director considered the enforcement of the Camposano order "an important thing" when the child is not in any need and she was financially well taken care of by Ms. Camposano. He said that he was trying, without success, to work out a financial arrangement with Ms. Camposano. The payor said that "he has a good relationship with Ms. Camposano when romance is involved and when not, it is more difficult".

[50] The payor also felt that his children in the Adema case have been well supported financially by Ms. Adema. He said that Ms. Adema has a Master's Degree in Business Administration and he has no doubt that she earns over $100,000 per annum. He added that she is now living with a roofer "who earns a lot". He said that there was no indication that his children required anything more.

[51] The payor deposed that he did not start a motion to change the Adema order because it would be financially impossible for him to go to Ottawa to do this.

[52] The payor advised the court that he has a Master's Degree in Spanish Literature and he can represent members of the Hispanic community.

Part Five – Legal Considerations

[53] The current statutory scheme governing default hearings is found in section 41 of the Family Responsibility and Support Arrears Enforcement Act (the Act) and rule 30 of the Family Law Rules. The Director may initiate the default proceeding. The Director prepares a statement of arrears. The payor files a financial statement and, if so inclined, a default dispute. The court may hear oral testimony, direct the production of other relevant documentation and add parties to the default proceedings. See: Fischer v. Ontario (Family Responsibility Office), 2008 ONCA 825, paragraph 17.

[54] At the hearing, the amount of arrears owed and the payor's ability to pay are the central issues. Subsection 41(9) of the Act puts the onus on the payor, as follows:

Presumptions at hearing

(9) At the default hearing, unless the contrary is shown, the payor shall be presumed to have the ability to pay the arrears and to make subsequent payments under the order, and the statement of arrears prepared and served by the Director shall be presumed to be correct as to arrears accruing while the order is filed in the Director's office.

[55] Subsection 41(10) of the Act sets out the powers of the court on a default hearing as follows:

Powers of court

(10) The court may, unless it is satisfied that the payor is unable for valid reasons to pay the arrears or to make subsequent payments under the order, order that the payor,

(a) pay all or part of the arrears by such periodic or lump sum payments as the court considers just, but an order for partial payment does not rescind any unpaid arrears;

(b) discharge the arrears in full by a specified date;

(c) comply with the order to the extent of the payor's ability to pay;

(d) make a motion to change the support order;

(e) provide security in such form as the court directs for the arrears and subsequent payment;

(f) report periodically to the court, the Director or a person specified in the order;

(g) provide to the court, the Director or a person specified in the order particulars of any future change of address or employment as soon as they occur;

(h) be imprisoned continuously or intermittently until the period specified in the order, which shall not be more than 180 days, has expired, or until the arrears are paid, whichever is sooner; and

(i) on default in any payment ordered under this subsection, be imprisoned continuously or intermittently until the period specified in the order, which shall not be more than 180 days, has expired, or until the payment is made, whichever is sooner.

[56] Subsection 41(11) of the Act states:

No effect on accruing of arrears or other means of enforcement

(11) An order under subsection (10) does not affect the accruing of arrears, nor does it limit or otherwise affect any other means of enforcing the support order.

[57] Subsection 41(17) of the Act reads:

Imprisonment does not discharge arrears

(17) Imprisonment of a payor under clause (10)(h) or (i) does not discharge arrears under an order.

[58] At a default hearing, the payor must show an inability to pay due to valid reasons. A valid reason is an event over which the payor has no control which renders the payor totally without assets or income with which to meet his or her obligations, such as disabling illness or involuntary unemployment. See: Ontario (Director, Family Responsibility Office) v. Carney, 2004 ONCJ 11. The payor must also show that he or she has accepted their responsibilities and placed the child's interests over their own and has provided frank disclosure to the court. See: Ontario (Director, Family Responsibility Office) v. Labrash.

[59] In Ontario (Director, Family Responsibility Office) v. De Francesco, 2012 ONCJ 6338, Justice Carolyn Jones further explores the meaning of "valid reason" under section 41(10) of the Act as follows at paragraph 21 of her decision:

Valid reasons, within the meaning of s. 41(10) of the Act, imply reasons for which the payor cannot be faulted or for which the payor does not bear responsibility in the culpable sense. The court would expect some evidence of circumstances where, despite reasonable, diligent and legitimate efforts by the support payor to comply with the support order, the support payor has been unable to do so for reasons that are not connected with an unwillingness to pay, a lack of effort, a failure to prioritize the support obligation or a deliberate neglect, failure or avoidance on the part of the payor. Evidence relating to the past and present circumstances of the payor, including his financial circumstances since the time of the first default under the order, the manner in which he has applied his available income and assets, and his efforts to secure employment or income during the time that the arrears have arisen will have some bearing upon the determination of the legitimacy of the reasons the payor puts forward for his default under the support order. Circumstances that are beyond the control of the payor, resulting in the payor's inability to pay, would be valid reasons. An illness on the part of the payor, including a mental disorder, rendering the payor completely unable to work on either a full or part-time basis, as in the case before the court, would amount to a valid reason for the payor's failure to pay.

[60] Clause 41(10)(i) of the Act contemplates an order of imprisonment for failure to pay an amount owing at the time the order is made or a failure to make future payments required under the order: See: Saunders v. Saunders, [1987] O.J. No. 1578, 10 R.F.L. (3d) 284 (Dist. Ct.), at para. 11; Fischer, supra.

[61] Enforcement legislation should be viewed as remedial rather than punitive. See: Saunders, supra.

[62] Imprisonment is a last resort. Something more than non-payment is required. The payor's conduct must demonstrate a willful and deliberate disregard for the obligation to comply with court orders. It is meant as a mechanism to enforce support and not as a means of punishing the payor. See: Fischer, supra.

[63] In Fischer, supra, the court writes at paragraph 25:

Further, the case law and the Act recognize that imprisonment for non-payment is meant as a means of enforcing the support order and not as a means of punishing the payor. The payor must be released upon payment of the amount owed: see s. 41(10)(i). A committal order, imposed as a term of either a temporary or final order in a default hearing, is intended to induce compliance with the payment terms of the order. The prospect of imprisonment hopefully focuses the payor's mind on the importance of making the required payments. The enforcement rationale for imprisonment upon non-payment makes sense only if the payor has the ability to make the payments required by the order: see Saunders, at paras. 11-13 …

[64] The maximum jail time should be reserved for the most severe cases. See: Ontario (Director, Family Responsibility Office) v. Kirkpatrick, 60 R.F.L. (6th) 435 (SCJ).

Part Six - Analysis

[65] The payor was only partially able to rebut the presumption that he has the ability to pay the outstanding arrears under the existing court orders.

[66] The payor has dug himself into a financial hole. He owes over $34,000 in support arrears between the two cases. He owes Revenue Canada about $50,000. He has nominal assets. The court accepts that the payor has not been able to run a financially successful practice. The court does not believe, based on the evidence presented, that he has the ability to pay the entire arrears owing at once (as requested by the Director) at this time.

[67] However, the payor did not rebut the presumption that he could afford to pay some portion of the arrears immediately, that lump sum payments could be paid periodically towards the arrears and that he could pay the ongoing support accruals in the Adema case.

[68] The payor was not a credible witness. He has not acted in good faith.

[69] The payor is a sophisticated litigant. He understands, or should understand, the importance of preparing pleadings, affidavits and financial statements and the importance of complying with court orders.

[70] The payor, by his actions, showed disdain for this process.

[71] The payor, despite being served with the Notices of Default Hearings on April 15, 2015, did not voluntarily pay a penny of child support in either case.

[72] On May 12, 2015, in both cases, the payor agreed to an order that he commence a motion to change. He did not comply with these orders. He did not provide reasonable excuses for his failure to comply with them.

[73] The payor also consented to an order on May 12, 2015 to serve and file sworn financial statements. He did not do this until January 18, 2016, the date of these default hearings.

[74] The payor was ordered (on consent) on May 12, 2015 to file Disputes to the Notices of Default Hearings, as well as his income tax returns and notices of assessment. He never filed Disputes or any affidavit evidence in these cases. He did not provide his 2014 income tax return until early January of 2016. Notices of assessment were not filed.

[75] The payor provided no documentation to support his self-reported statements of revenues and expenses contained in his income tax returns. While the court accepts that the payor's practice is not financially successful, it is not confident in his declarations of his income. The payor could not explain why his income has been so low for a person with his skills and experience.

[76] The payor deposed that he did not drive a vehicle after his driver's licence was suspended on November 4, 2013. However, in his 2014 income tax return he deducts $4,726 for car expenses. He could not explain this discrepancy.

[77] A review of the payor's Statement of Business and Professional Affairs for 2013 and 2014 reveals that he is overly aggressive in writing off expenses. He does not attribute any personal use for his vehicle, even though he used it for personal and business purposes. He writes off 50% of his home expenses, even though this home is shared with his girlfriend (who, based on the payor's evidence, earns more than him). He could not explain other line items where expenses were deducted.

[78] Even if the court accepted the payor's statements of revenues as being correct, he has likely been earning between $30,000 and $40,000 per annum between 2013 and 2015.

[79] The payor has had 9 months to show good faith by paying some support.

[80] The payor has preferred his interests ahead of those of his children. His financial statement reveals that he spends $300 per month on alcohol and tobacco, $100 per month on entertainment and $300 per month towards his debts. Yet he is choosing not to voluntarily pay any child support.

[81] The payor did not provide a valid justification for his poor payment history. He presented no plan to pay the arrears. He gave no indication that he would voluntarily make any payments in these cases. He presented as aggrieved that his support obligations are being enforced. He feels that his children have been provided for adequately by their mothers. Why is he being bothered now?

[82] The payor has chosen not to bring a motion to change the Adema order. He has not rebutted the presumption that he has the ability to pay the ongoing support payments.

[83] It has become clear that less aggressive enforcement options other than imprisonment have failed. The suspension of the payor's driver's licence and passport did not result in support compliance. These default proceedings have had little impact on his payments. The payor was given multiple opportunities to comply with the support and disclosure orders.

[84] The payor knows or should know the potential consequences of his behaviour. It is disappointing that a family law lawyer has acted in such a manner.

[85] The court has limited sympathy for the payor's predicament. It is reserved for his children who have gone without adequate support and the mothers of those children who have assumed the payor's support obligations.

[86] The message needs to be sent to the payor that child support orders for his children matter and will be enforced. The default orders shall provide for an immediate committal of the payor for 75 days in both cases or until a portion of the arrears ($3,500 in each case) is paid.

[87] The payor will also be required to pay $2,500 towards the support arrears in each case on both July 1st and January 1st of each year until they are fully repaid, failing which he will be committed to jail for 75 days, for each payment in default, or until he pays the $2,500.

[88] In addition, the payor will be required to maintain the monthly child support payments of $800 per month in the Adema case. He will be committed to jail for 3 days (or until the outstanding amount is paid in full), for each default in payment of ongoing support accruals.

[89] The amounts that the payor will be required to pay to be released from jail are far less than those sought by the Director. The committal periods are also shorter than those sought by the Director. These committal periods shall run consecutively.

[90] The maximum length of time, cumulatively, that the payor can be imprisoned under each Default order is 180 days (see: clause 41(10)(i) of the Act). Once that limit is reached, a new default action would be required.

[91] The payor asked for 7 days to wrap up his practice if the court chose to make committal orders. The court will hold the warrants of committal in abeyance and return the matter to court on January 29, 2016 at 10:00 a.m. This will also give the payor the opportunity to make the necessary lump sum payments to avoid going to jail on the return date.

Part Seven - Conclusion

[92] In the Camposano case, there shall be a final default order on the following terms:

a) Child support arrears are fixed in the sum of $15,073.30 as of today.

b) The payor will be committed to jail immediately for 75 days or until such time as he pays $3,500 towards the arrears.

c) The payor shall pay the sum of $2,500 towards the support arrears on both July 1st and January 1st of each year, until they are repaid (the January 1st payment starting in 2017). The payor will be committed to jail for 75 days (or until the outstanding amount is paid in full) for each default in payment.

d) The maximum length of time, cumulatively, that the payor can be imprisoned under this default order is 180 days.

[93] In the Adema case, there shall be a final default order on the following terms:

a) Child support arrears are fixed in the sum of $19,462.99 as of today.

b) The payor will be committed to jail immediately for 75 days or until such time as he pays $3,500 towards the arrears.

c) The payor shall pay the sum of $2,500 towards the support arrears on both July 1st and January 1st of each year (the January 1st payment starting in 2017), until they are repaid. The payor will be committed to jail for 75 days (or until the outstanding amount is paid in full) for each default in payment.

d) The payor will also be required to pay the ongoing child support payments of $800 each month starting on February 1, 2016. He shall be committed to jail for 3 days (or until the outstanding amount is paid in full) for each payment in default of ongoing support accruals.

e) The maximum length of time, cumulatively, that the payor can be imprisoned under this default order is 180 days.

[94] The periods of incarceration set out in the Camposano and Adema cases shall run consecutively.

[95] Nothing in these orders preclude the Director from collecting support arrears from any government source (such as income tax or HST returns) or lottery or prize winnings.

[96] These matters shall return to court on January 29, 2016 at 10:00 a.m. The warrants of committal shall be held in abeyance and not enforced until that date.

Justice S.B. Sherr

Released: January 21, 2016