Alaei v Alaei, 2024 ONSC 5663
CITATION: Alaei v Alaei, 2024 ONSC 5663
DIVISIONAL COURT FILE NO.: 1565/24
DATE: 20241011
ONTARIO SUPERIOR COURT OF JUSTICE
Sachs, McCarthy, and Myers JJ
BETWEEN:
MOSTAFA ALAEI Appellant
-and-
MEHRIDOKHT ALAEI Respondent
COUNSEL:
Meysa Maleki and Jen-Yii Liew, for the Appellant
Brahm D. Siegel and Zakiya Bhayat, for the Respondent
HEARD at Toronto: October 1, 2024
REASONS FOR DECISION
FL Myers J:
Introduction
[1] Mostafa Alaei appeals to this court from the order of Bruhn J. dated October 25, 2023. The Motion Judge granted summary judgment dismissing Mr. Alaei’s claim to set aside a separation agreement between the parties dated December 10, 2019. Mr. Alaei also appeals, and, if necessary, seeks leave to appeal from the associated costs order dated March 11, 2024.
[2] At the conclusions of the oral submissions of counsel for Mr. Alaei, we advised counsel for Ms. Alaei that we did not need to hear from them beyond their written submissions. For the reasons that follow, the appeal is dismissed.
Jurisdiction and Standard of Review
[3] An appeal lies to this court under s. 19(1)(a.1) of the Courts of Justice Act, R.S.O 1990, c C.43. That section permits an appeal as of right to the Divisional Court from a final order of a judge of the Family Court made exclusively under Ontario law.
[4] The regular standard of review for appeals applies in this proceeding. The court will review issues of law for correctness. Issues of fact and mixed fact and law are reviewed on a deferential standard. Errors of fact and mixed fact and law will be corrected only if they are both palpable and overriding errors (as those terms are defined in the case law). See, for example, Waxman v. Waxman, 2004 39040 (ON CA), at paras. 296 and 297.
[5] Sometimes, in applying the law to the facts as found, a separate question of law arises. This is referred as “an extricable question of law” arising from the spectrum of issues of mixed fact and law. Like other questions of law, extricable legal issues are reviewed on a correctness standard. See: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 SCR 235, at paras. 8, 10, and 36.
Background Facts
[6] The Motion Judge set out the basic facts as follows:
[20] The parties were married on October 31, 2004. At the time of marriage, the wife was residing in Canada and the husband was residing in Germany.
[21] There are no children of the marriage.
[22] The husband has a child from a previous relationship, namely Arman Alaei, born August 7, 1983 ("Arman").
[23] The wife has two children from a previous relationship, namely Roya Alaei, born September 30, 1984 ("Roya"), and Ravin Alaei, born December 7, 1992 ("Ravin").
[24] The husband and his son, Arman, moved to Canada in or about March 2005.
[25] The parties and their children resided in the wife's rental accommodations from March to August 2005.
[26] In August 2005, the property at 111 Bridlepath Street, Richmond Hill ("Bridlepath"), was purchased and the parties and their children moved into that property.
[27] Title to Bridlepath was held in the name of the wife alone, and the wife and Roya were on the mortgage on that property.
[28] The parties separated in the spring/summer of 2006. Thereafter the husband left Canada and moved to Iran in the fall of 2007.
[29] In or about August 2007, the wife signed an offer to purchase the property at 7 Ferretti Street, Vaughan, Ontario ("the former matrimonial home").
[30] The parties reconciled in or about February 2008 and the husband returned to Canada in or about May 2008.
[31] In August 2008, the sale of Bridlepath and the purchase of the former matrimonial home closed.
[32] Title to the former matrimonial home was held in the name of the wife and Roya as tenants in common, each with a 50% interest. The wife and Roya were on the mortgage on the property.
[33] In August 2008, the parties and the children moved into the former matrimonial home.
[34] The parties separated again in about March 2013. They continued to reside separate and apart in the former matrimonial home.
[35] In February 2014, the husband filed for divorce seeking an order granting him 50% ownership of the former matrimonial home and an equalization of net family properties. The husband was represented by counsel.
[36] The parties reconciled shortly thereafter. The wife did not file an Answer and the husband did not proceed with his Court Application.
[37] The parties separated for the final time on November 1, 2017. They continued to reside separate and apart in the former matrimonial home until about February 3, 2020.
[38] Atoosa [Ataellahi] assisted the parties in the negotiation and preparation of their Separation Agreement. Atoosa was engaged to be married to the wife's nephew. Atoosa has some legal training either as a law student and/or as a paralegal and has worked in the legal system, including as a clerk at the Newmarket Court House.
[39] The parties met with Atoosa three times to discuss the terms of the Separation Agreement and to sign the Agreement. The parties and Atoosa met on November 22, 2019, for almost 3 hours to discuss the terms of the Agreement, on December 6, 2019, for about 2.5 hours to discuss the terms of the Agreement, and on December 10, 2019, for about 45 minutes to review and sign the Agreement. The wife believes that the parties and Atoosa met briefly on another occasion between December 6, 2019, and December 10, 2019; however, this is disputed. The Court was not provided with any transcript of this meeting. The parties also met with Atoosa on February 3, 2020, when the wife provided the husband with the settlement funds pursuant to the Separation Agreement, and the husband signed an acknowledgement of payment.
[40] The Separation Agreement resolved all issues arising out of the parties' separation.
[41] The only significant asset the parties owned at the valuation date was the former matrimonial home.
[42] The Separation Agreement provides, among other things, for the buy-out or sale of the former matrimonial home, including the division of the value or sale proceeds, the division of contents, and mutual releases of all other claims, including claims to spousal support, property division and equalization.
[43] Pursuant to the Separation Agreement, on February 3, 2020, the husband transferred all of his interest in the former matrimonial home to the wife in exchange for a payment of $176,625. Thereafter the wife had exclusive possession of the former matrimonial home.
[44] The parties met on February 26, 2020, at the husband's request. Atoosa did not attend this meeting. During this meeting the husband stated that he believed there had been a mistake with respect to the value of the former matrimonial home, that it was worth more than they had agreed upon. Therefore, he requested that the parties renegotiate the terms of the Separation Agreement. However, the wife refused to do so.
[45] In June 2020, the husband amended his Court Application and returned this matter to Court seeking orders for divorce, setting aside the Separation Agreement, for the equalization of the parties' net family property, a formal appraisal, the sale of family property, spousal support, and costs. The husband was represented by counsel.
[46] In his Amended Application, the husband did not make any trust claims, nor did he request an order that he have 50% ownership of the former matrimonial home. However, he did allege that Roya did not contribute to the mortgage or carrying costs of the matrimonial home in any capacity. He further alleges that the Applicant contributed to these expenses, that the title to the former matrimonial home was registered in the name of the wife and Roya for the sole purpose of qualifying for financing, and that "Roya was essentially holding the Applicant's share in trust."
[7] The parties met with their facilitator Ms. Atoosa Ataellahi several times. Mr. Alaei recorded the meetings surreptitiously. As a result, the Motion Judge had transcripts of what was actually said by the participants during each meeting as they negotiated their separation agreement.
[8] Mr. Alaei submitted below and again in this court that he was preyed upon and taken advantage of by his spouse, the facilitator, and a real estate agent who provided an incorrect opinion of value of the parties’ home.
[9] The real estate agent provided Ms. Alaei with an opinion letter stating that the home was worth $1.1 million at the relevant time. Subsequent valuations obtained by the parties put the value between $1.26 million and $1.47 million. (The lower appraisal obtained by Ms. Alaei was for an earlier effective date.)
[10] In the settlement negotiations, Mr. Alaei accepted that his entitlement would be based on 50% of his spouse’s 50% interest in the property i.e., he would get credit for 25% of the value. Mr. Alaei argues that the facilitator told him that this was a correct determination in law despite the fact that he could have claimed that Ms. Alaei’s direction of 50% of title to her daughter was ineffective. But, as noted in the recitation of background facts above, Mr. Alaei had brought a prior proceeding in which he made a claim for 50% of the value of the house on that basis. Knowing of his right to do so, he did not make a claim against the daughter’s half of the house in his amended application or in the negotiations of the separation agreement.
[11] The Motion Judge found that with the transcripts of the parties’ meetings, the evidence of the parties, and the evidence of the real estate agent, all before her, she had a comprehensive factual record on which she could fairly and efficiently make findings of fact and law. This holding is entitled to deference and I agree with it in any event. There was nothing to be gained by deferring the hearing to a trial. See: Hryniak v. Mauldin, 2014 SCC 7 at paras. 81 and 82.
[12] The Motion Judge held that Ms. Alaei did not make a misrepresentation to Mr. Alaei concerning the value of the parties’ home. First, the opinion presented was just a real estate agent’s opinion. The sole fact that appraisers later arrived at different retroactive appraisals does not make the initial opinion wrong and certainly not deliberately so. It was just one agent’s contemporaneous opinion. Second, Mr. Alaei knew that he had every right to challenge Ms. Alaei’s value by obtaining a valuation or appraisal of his own during the negotiations. He did not rely on Ms. Alaei’s valuation or, if he chose to do so, he did so knowing that he could assert a different view of the value of the house if he was not content with value put forward by Ms. Alaei.
[13] The Motion Judge considered the evidence that the facilitator encouraged the parties to agree on a joint appraiser to save money. But they never agreed on a joint appraiser. Rather, Ms. Alaei obtained an opinion of value and Mr. Alaei did nothing. The Motion Judge held:
[81] The husband does not obtain a valuation of the former matrimonial home. This is despite the fact that he knew that he was entitled do so and he knew the importance of obtaining a proper valuation given that the home was far and away the parties' most significant asset. Instead, he chose not to get a valuation or an appraisal, but rather left it to the wife to do so. I do not accept that this was because he trusted the wife. This argument is undermined by the husband's own actions in surreptitiously recording all of his meetings with the wife. I find that the husband did not obtain his own valuation because he did not want to spend the time or money to do so. A review of the transcript reveals that a speedy and inexpensive resolution of the outstanding issues was a priority for the husband.
[82] At the parties' next meeting on December 6, 2019, the parties are discussing a buy-out based on a value of $1,100,000. The husband does not raise any objections to this value. During that meeting, when the parties were discussing the calculation of the buy-out, and the husband raises concerns regarding the disposition costs and says that he would like to get some information on this himself, Atoosa encourages him to do so and asks him if there is anything else he would like to get more information on. The only thing he mentions are the disposition costs, specifically the mortgage penalty and the lawyer's fees. [Emphasis added.]
[14] I have emphasized the sentences in which the Motion Judge found that Mr. Alaei wanted a cheap and quick resolution. This holding undermines all his arguments that he was preyed upon. He chose how to proceed knowing that he had already sued and that he could obtain a valuation of the house if he wanted to do so.
[15] In considering the parties’ subsequent valuations, the Motion Judge held:
[94] However, this does not mean that the wife misrepresented the value of the matrimonial home. There is a distinction between disclosing assets and liabilities and their values believing the disclosure to be true, and deliberately misrepresenting the values of assets and liabilities knowing them to be untrue: Aubin v. Koerber, 2021 ONSC 5125, 335 A.C.W.S. (3d) 809, at para. 90. I am not persuaded that the wife or Ms. Noormehr [the real estate agent] or Atoosa did not believe the value of $1,100,000 to be true.
[95] Further, the fact that the appraised values are higher does not mean that the letter of opinion was defective. While I recognize that appraisals are generally more reliable than letters of opinion because they are a more thorough look at the value of the property, both a letter of opinion and an appraisal are based on an opinion. The true value of the property cannot be known unless it is sold. In that regard, I note that the parties discussed the option of selling the property during their negotiations. The husband was aware that he could pursue the sale of the former matrimonial home, and that it may sell for an amount significantly different from the valuation. However, he agreed to a buy-out by the wife based on a value of $1,100,000.
[96] The husband also claims that when the parties met on February 26, 2020, after the Separation Agreement was signed, the wife admitted that she misrepresented the value of the matrimonial home to him. The husband points out that when the husband says he trusted the wife, she says he should not have. However, those comments are made in the context of a conversation about how the husband was told to have someone value the home, he did not do so, the wife did so, and it was that valuation the parties used in the Separation Agreement. I do not find the wife's comments to be an admission of misrepresentation by the wife, but rather an admonition of the husband for not making the appropriate enquiries and obtaining his own valuation at the relevant time.
[97] I am persuaded that the negotiated terms do not stray substantially from the goals of the relevant legislation. [Emphasis added.]
Issues and analysis
[16] Mr. Alaei essentially seeks to re-argue the summary judgment motion in this court. He does not challenge that in paras. 61 to 64 of her decision, the Motion Judge recited the correct law to govern enforcement of separation agreements under s. 56 (4) of the Family Law Act, RSO 1990, c F.3. See: Quinn v. Epstein Cole LLP, 2008 ONCA 662 and Armstrong v. Armstrong, 2021 ONSC 5774, at para. 11.
[17] Rather, Mr. Alaei challenges the Motion Judge’s findings of fact, credibility findings, and her application of the law to the facts.
[18] In my view, the Motion Judge carefully set out both side’s evidence in the context of the applicable law. Her findings of fact and credibility were both open to her and well-grounded in the evidence. Mr. Alaei’s counsel was unable to point to any palpable and overriding errors of fact or mixed fact and law.
[19] Mr. Alaei points to discrete alleged errors concerning the precise date that he returned to Canada, the date the separation agreement was signed, and a prima facie difference in evidence between Ms. Alaei and the real estate agent as to whether the agent actually attended the house before delivering her opinion of value. None of these alleged errors is a palpable error – i.e., obvious from an uncontested record. Neither are they individually or collectively of overriding import. None would likely be important to the outcome.
[20] Counsel for Mr. Alaei submits that the wife’s evidence that the real estate agent did not attend the house was untrue and should have resulted in a negative credibility finding. The Motion Judge accepted that the real estate agent had the better evidence about her own conduct. The Motion Judge accepted that Ms. Alaei forthrightly corrected her evidence on hearing the real estate agent’s evidence. The Motion Judge knew that Ms. Alaei’s sworn testimony had been wrong and accepted a correction without making a major credibility finding.
[21] Not every molehill of inconsistency necessarily grows into a mountainous credibility finding. It was open to the Motion Judge to consider the error in the testimony and accord it limited weight considering the explanations offered. No error in principle or reviewable error is alleged or established on this point.
[22] Mr. Alaei submits that the Motion Judge reversed the burden of proof by expecting him to provide evidence that he was not misled by the value put forward by Ms. Alaei. He relies on cases like Virc v. Blair, 2014 ONCA 392, at para. 58, for the proposition that a person has no legal duty to inquire into the veracity of a deliberate material misrepresentation.
[23] It is an undoubted principle of law that a liar is not entitled to avoid accountability by saying that her victim should have done more to protect himself or to discover the truth behind the lie.
[24] But the principle in Virc and similar cases has no application here considering the Motion Judge’s finding that there was no misrepresentation let alone a deliberate lie. Rather, the parties were negotiating in circumstances where both knew that they could advance their own positions and Mr. Alaei chose to refrain from doing so to advance his goal of a quick and cheap resolution.
[25] Similarly, counsel for Mr. Alaei referred us to cases for the proposition that the court will set aside a separation agreement where one spouse has taken advantage of the other. She relies on the following statement by the Supreme Court of Canada in Rick v. Brandsema, 2009 SCC 10,
[4] This appeal, therefore, attracts a spotlight to the duties owed by separating spouses during the process of negotiating and executing a separation agreement for the division of matrimonial assets. In Miglin, based on the inherent vulnerability of spouses during negotiations, this Court stated that in order to safeguard a separation agreement from judicial intervention, a spouse must refrain from using exploitative tactics. It held that the failure to do so, particularly if the agreement fails to materially comply with the objectives of the governing legislation, could well result in the agreement being set aside.
[26] Once again, while this is undoubtedly a correct statement of the law, it cannot apply in this case in light of the Motion Judge’s finding, emphasized in para. 97 quoted above, that based on all of the evidence of the negotiations, the settlement terms do not stray from the goals of the legislation.
[27] In all, Mr. Alaei has not established that the Motion Judge made an error of law, fact, or mixed fact and law, to the degree required for appellate intervention.
Costs Appeal
[28] Finally, Mr. Alaei has not raised any basis for the court to grant leave to appeal from the costs decision made by the Motion Judge independent of the appeal of the substantive decision.
[29] The Motion Judge found that Ms. Alaei had obtained a more favourable outcome than she had been willing to pay as set out in her offers to settle. The Motion Judge considered the reasonableness of the costs claimed as well as issue of proportionality as required. She exercised her discretion to order Mr. Alaei to pay in two tranches an aggregate amount that was about halfway between the costs he incurred and those incurred by Ms. Alaei.
[30] Costs are purely discretionary decisions that will rarely support leave to appeal. Appeals can be available where a judge makes a costs decision that is plainly wrong or based on a wrong principle. See: Hamilton v. Open Window Bakery Ltd., 2004 SCC 9, at para 27. Here, the Motion Judge supported her discretionary decision with seven pages of cogent reasons. There is no basis to grant leave to appeal.
Conclusion
[31] The appeal is dismissed.
[32] Counsel advised that they had agreed on the quantum of costs to be awarded to the successful party. Therefore, Mr. Alaei will pay costs fixed at $15,000 all-inclusive to Ms. Alaei as agreed.
Myers J
I agree _______________________________
Sachs J
I agree _______________________________
McCarthy J
Released: October 11, 2024
CITATION: Alaei v Alaei, 2024 ONSC 5663
DIVISIONAL COURT FILE NO.: 1565/24
DATE: 20241011
ONTARIO
SUPERIOR COURT OF JUSTICE
DIVISIONAL COURT
Sachs. McCarthy, and Myers JJ
BETWEEN:
MOSTAFA ALAEI Appellant
-and-
MEHRIDOKHT ALAEI Respondent
REASONS FOR DECISION
FL Myers J.
Released: October 11, 2024