SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 810/10 (Guelph)
DATE: 20120620

RE: BARBARA ANN BLATHERWICK - and - BRIAN EARL BLATHERWICK

BEFORE: Lemon J.

COUNSEL:
John G. Cox, for the Applicant
Stuart M. Law, for the Respondent

E N D O R S E M E N T

[ 1 ] On April 24, 2012, I provided the parties with an endorsement. They seek clarification with respect to a number of items.

[ 2 ] In my endorsement I said:

[23] Mrs. Blatherwick seeks interim support of $62,000.00 per month retroactive to the date of separation ( November 18, 2010 ), representing an income split of fifty percent to each of the parties, presuming an imputed income of 1.5 million. Mr. Blatherwick submits that he should pay a midpoint Spousal Support Advisory Guideline (SSAG) amount of $16,880.00.

[24] By agreement, Mr. Blatherwick has been paying $11,375.00 per month plus specified household expenses for a total of $12,734.73 per month.

[33] On the evidence before me, and on a completely without prejudice basis for the benefit of the trial judge, I make my order on the basis of an imputed income to Mr. Blatherwick of $463,000.00 and order support at the high end of the range being $20,000 per month. Based on her financial statement, Mrs. Blatherwick can clearly make ends meet on this amount. In my view, the substantial legal expense that Ms. Blatherwick will have to endure to proceed with this litigation would indicate support on the high side. This order shall commence November 18, 2010 subject to payments made by Mr. Blatherwick (not including the $4000.00 dealt with below).

[34] On November 18, 2010 Mr. Justice Belleghem ordered:

The Respondent shall continue to make any and all historical payments he has been making since the date of separation in relation to all assets in Canada, including the matrimonial home, directly and indirectly on behalf of the Applicant.

[35] At the time, Mr. Blatherwick paid Mrs. Blatherwick $4,000.00 per month as a dividend from one of his companies. The parties acknowledge that this payment was a historical expense that had been paid prior to separation. However, as of September 29, 2011, Mr. Blatherwick took the position that he was never obligated to pay the dividend. Rather, he did that because he was “a good guy”. Mr. Blatherwick and his counsel now submit that the $4,000.00 dividend had never been “on her behalf”. Instead, the provision is to cover such payments as property taxes and insurance relating to the matrimonial home but does not cover the $4,000.00 monthly dividend. Mrs. Blatherwick submits that this amount was an historical amount that the parties agreed would continue to be paid pursuant to the ex parte order and the consent order that followed.

[39] The term appears to be a stop gap measure to be applied until an interim order could be determined. Now that I have determined interim spousal support, that dividend payment should come to an end as of May 1, 2012 subject to the trial judge’s determination.

[ 3 ] Counsel seek clarification with respect to the endorsement in order to prepare the order. The issues that appear to arise are:

(a) Should the support order and calculation of arrears take the impact of tax into consideration?

(b) When does the support payment of $20,000 start?

(c) When does the $4000 dividend payment end?

Tax Issues

[ 4 ] The most significant issue is as to whether I should consider the tax treatment of both the income that I have deemed to Mr. Blatherwick and the effect of the various support payments. I decline to do so.

[ 5 ] Mr. Blatherwick had been paying $12,734.73 by consent order since June 23, 2011. The parties agreed that he would pay $11,375.00 per month and that “this income shall not be taxable in the hands of the Applicant, nor shall it be deductible by the Respondent”. I have ordered that he should pay $20,000.00 per month since November 28, 2010.

[ 6 ] Mr. Blatherwick had been paying $12,734.73. He should have been paying $20,000.00. I gave him credit for the first and ordered him to pay the balance. What the Canada Revenue Agency does to both Mr. Blatherwick and Mrs. Blatherwick as a result of those payments, agreements and orders is up to the CRA and not up to me.

[ 7 ] No doubt a lump sum payment will be necessary to catch-up the arrears. Whether that is taxable or not or deductible or not is not of my concern. Instead it needs to be paid and it needs to be paid forthwith.

Commencement Date

[ 8 ] I have not been clear as to the commencement date of the payments. Since the first payment was November 18, 2010, the payments should be made on a monthly basis on the 18 th day of each month thereafter.

End Date

[ 9 ] Although perhaps not clear in my endorsement, it was my intention that the $4,000.00 payment would end before the May payment since support would have started by then. Given that the support will have commenced April 18, 2012, that dividend should certainly not be paid on May 1, 2012.

Other issues

[ 10 ] Mr Law wrote to me on May 17, 2011 with a number of issues. Two of those issues were:

(c) Mr. Cox has not given Mr. Blatherwick credit for the $4,000.00 a month Mr. Blatherwick paid Mrs. Blatherwick from December 1, 2010 to September 30, 2011 through Seasonal Design Group Ltd.; and

(d) Mr. Cox and I also differ on whether or not Mr. Blatherwick should get credit for the $4,000.00 a month he paid through Seasonal Design Group for the period December 1, 2010 to September 30, 2011 ($40,000.00). I have given Mr. Blatherwick credit for this because Your Honour ordered that he get credit for spousal support that he did pay.

[ 11 ] There appears to be duplication in (c) and (e). On the other hand, Mr. Law, in his reply submissions on June 8, 2012 says “The amount of spousal support paid by Mr. Blatherwick prior to the Order is uncontested.” The submissions on behalf of Mrs. Blatherwick do not assist to clarify that issue. Mr. Cox repeats a number of times that Mr. Blatherwick has not been honest in a variety of areas. That is of little relevance to these issues.

[ 12 ] Mr. Cox has not specifically responded to each of the issues set out by Mr. Law. Accordingly, I cannot be certain that I have answered all of the questions. If I have left anything out of this endorsement, counsel may provide written submissions that set out the issue (within 15 days) and any response to that issue (within 15 days thereafter).

[ 13 ] As a final note, both counsel read more into my endorsement than is there. Mr. Cox often refers to my “finding of fact”. Mr. Law submits that I relied on the report of Ms. Russell. I made my order on very little reliable evidence. In order for me to rely on Ms. Russell, I would have had to rely on Mr. Blatherwick. For the reasons set out in my endorsement, I did not rely on Mr. Blatherwick. While I accepted some propositions and made inferences to the extent that I could, I expressly left the findings of fact to the trial judge.

[ 14 ] I trust that this endorsement will clarify my earlier endorsement.

Lemon J.

DATE: June 20, 2012