G.V.Q. v. M.L.Q., 2012 ONSC 4250

DATE: 20120803

DOCKET: 06-FD-318786 FIS

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

G.V.Q.

Applicant, In Person

Applicant

– and –

M.L.Q.

Respondent

Paul S. Pellman for the Respondent

HEARD: May 15, 16, 17, 18, 22 and 25, 2012

CZUTRIN J.:

The Commencement of the Application

[1] This case started out as an Application commenced by G.V.Q. (the “father”) in July 2006 when he was represented by a senior family counsel seeking: a divorce; custody of the parties’ child, K, born March 25, 2002; equalization; a declaration that a Marriage Contract dated November 15, 1996 is “in full force and effect”; the partition and sale of the jointly held matrimonial home at Mann Avenue Toronto; and determination of the Respondent M.L.Q.’s (the “mother”) entitlement to spousal support and if entitled, quantum and duration.

[2] The father’s Application anticipated the issues that would arise from the parties’ marriage and separation.

[3] In the Application, his recitation of facts relating to the Marriage Contract included:

o “except for the exclusion of the business” the Family Law Act would apply to all property and support issues;

o the Marriage Contract was intended “to protect my business interests from sharing”;

o “the Marriage Contract also [provided] that in the event of separation and the [mother] asserts a support claim, that she may receive limited disclosure of the relevant financial records of the corporation solely for the purpose of verifying my income as disclosed by my income tax returns, T4’s and other relevant documentation.”

[4] According to the father, the parties started to live together on March 1, 1993, married on December 28, 1997 and separated on July 1, 2004.

[5] To defend the father’s Application and make her own claims for corollary relief, the mother also retained senior family counsel and claimed divorce, custody, child and spousal support, exclusive possession of the Mann Avenue Property, and an accounting for sale of a previously occupied home and cottage. She also contested the validity of the Marriage Contract. She asserted a claim to the entire Mann property based on a claim that the father held her interest by way of trust for her (resulting or constructive.)

[6] She asked for valuation of the father’s business interests at marriage and separation and sought disclosure under sections 21 and 25 of the Child Support Guidelines.

[7] She claimed that the parties’ separation was August 2004 and not July 1, 2004 as claimed by the father.

[8] Although the issues and competing themes between the parties were established soon after separation, there were remarkably few motions or orders and no rush to trial.

Reasons for Trial and Issues Remaining

[9] At trial the father appeared without the benefit of counsel and only called two witnesses: himself and an expert, Bruce Brooks., a Chartered Accountant and Chartered Business Valuator.

[10] Mr. Brooks was retained by the father as his report of November 30, 2011 indicated:

You have asked us to review and comment on the report prepared by Bonnie Prussky, [mother’s expert retained to determine father’s income] dated August 3, 2011, regarding [father’s] 2010 income that is available for support purposes. We have restricted the scope of our review to the adjustments that Bonnie Prussky has calculated to your line 150 income, as reported on your 2010 personal income tax return. [Emphasis added.]

[11] In addition to testifying herself, the mother called as witnesses: the father’s new wife, C.Q.; her expert (Ms. Bonnie Prussky); her twin sister; and the lawyer who provided her with independent legal advice at the time of signing the Marriage Contract.

[12] Pre-Application efforts at resolution did not succeed and the father commenced the Application. Post-separation, each parent changed lawyers. As the case unfolded it became evident that the father was not a fan of family lawyers. Equally evident was the need for the mother to have a lawyer to protect her rights and to compensate for the fact that the father was an admittedly controlling person who was used to getting his way.

[13] The father, rather than denying being a controlling person, attempted to justify his admitted control in his relationship with the mother by stating that she needed to have him in control. He analogized this to the need for leaders of countries and judges to be in control. This theme and justification played itself out in the lives of the mother and K. He influenced the negotiations of the Marriage Contract and in the birth of K in the U.S.A. in order for her to be an American citizen. He also controlled the timing of the separation, including steps he took to sell the mother and father’s Ajax home and family cottage and then purchased Mann Avenue prior to separation, which I find was meant to ensure the location where K and her mother might live after the separation. Finally, the father controlled how much and in what manner he might provide money for the mother.

[14] By the time I heard closing submissions, the following issues remained:

1. The parental time sharing of K, but even that issue narrowed to:

a. The father wanting to continue the week-about arrangement and have joint custody, but wanting to have the right to make decisions about K’s education.

b. The mother wanting to change the schedule if the father continued to live in Waterdown or a distance that required extensive driving for K to get to school from the father’s residence.

c. While father wanted to have the right to determine educational issues he was prepared to have some mechanism to address the issue in the event of impasse.

2. Entitlement, quantum, and duration of any spousal support to be paid by the father to the mother.

3. The father’s income.

4. Quantum of child support.

[15] The equalization issue was resolved with the understanding that the jointly held Mann property would be vested or transferred to the mother in satisfaction of the equalization payment, although the mother was still seeking a repayment of a loan given to the parties by her father’s estate.

[16] The issue of the Marriage Contract was resolved because it appeared to have no impact on the outcome of any equalization payment.

[17] Based on the concessions made, as the evidence was received, I order the vesting of the Mann Avenue property to the Respondent mother, with all utility and tax payments being current and with no encumbrances on title and free of any further claims to the property by the father. With the vesting on these terms and conditions, the issue of equalization is resolved and the mother will be responsible for any debt to her father’s estate.

[18] I am grateful to the parties for providing written opening statements and proposed draft orders as we began the case.

[19] While without counsel, the father was prepared and appeared to have sought advice in preparation for and, perhaps, at times during the trial. I explained the trial process to him and allowed him time to consider his position as it changed from time to time, particularly relating to the equalization resolution that he ultimately was prepared to accept.

[20] He was at all times courteous and respectful to the court.

[21] The father’s request to “have sole responsibility for K’s education and school enrolment” was based on his disappointment that the mother was not prepared to allow for K’s enrollment at St. Clements School in Toronto after K was accepted and the father’s expressed willingness to pay the $24,000 annual tuition and fees.

[22] He asked that the spousal support be terminated and for an “Order clearly dividing the spousal portion from the child portion of the support, so that [he might] claim his rightful CRA spousal support deduction retroactive to the 2007 tax year.”

[23] He initially asked that the mother make an equalization payment to him of $400,000.

[24] Finally, he asked that each party should pay their own costs.

[25] In her proposed draft order the mother asked for:

a. Custody of K.

b. Reasonable and liberal access to the father:

1. Alternate weekends from Friday after school until Monday morning,

2. One half of Christmas,

3. One half of the Summer,

4. Alternating March breaks,

5. Joint consultation on all major issues affecting K. In the event of a dispute, the decision of the mother being final subject to either party being free to proceed to court.

c. The father to pay the mother $8,500 per month spousal support terminating June 2015.

d. Child support to be paid by father of $2,500 per month.

e. The transfer of the Mann property to the mother to satisfy the equalization payment.

f. Retroactive spousal support of $288,000 payable at the rate of $8,000 per month commencing June 2015 (for 36 months, until June 2018.

g. Costs fixed at $75,000.

Additional Background

[26] The father was born December 9, 1970.

[27] The mother was born June 22, 1969.

[28] The father worked for and now owns a company that was previously owned by his father. His parents went through a separation, that according to the father, was hotly contested (my conclusion). The father’s evidence leads me to conclude that his father’s experience influenced him to take steps to protect the business he eventually obtained from his father. It has also likely influenced his views of family lawyers and, perhaps, his sense of fairness of outcomes when parents separate.

[29] The father’s father, who now spends half of his time in California, did not testify. According to the father, his father wanted to consider succession planning and the Marriage Contract, pre-dating marriage by more than a year, which was meant to address his father’s experience when he separated from his mother, limit disclosure and exclude the family business from being considered in any equalization payment calculations.

[30] The Marriage Contract as originally drafted and then redrafted was prepared by the father’s lawyer. He was not called to testify and he would have been able to address the issue of disclosure.

[31] The mother retained her own lawyer when considering the Marriage Contract and her lawyer was called by the mother to give evidence. The mother’s lawyer testified that the father attended the lawyer’s office by inviting himself to a meeting with the mother, to try to convince the lawyer that the proposed Marriage Contract was fair. The lawyer said the father talked for an hour but did not come with any financial documents. The father denied that he invited himself. According to the mother’s counsel, the meeting ended badly with the mother crying.

[32] Mother’s lawyer had no correspondence with father’s lawyer who drafted the Marriage Contract and noted that the last revised agreement allowed for “limited financial disclosure.”

[33] Mother’s lawyer testified, and I accept his evidence, that he had not received any disclosure from father’s lawyer. The father was not prepared to waive solicitor/client privilege, but privilege did not need to be waived to provide any evidence of financial disclosure made at the time of the Marriage Contract.

[34] Mother’s lawyer testified that the mother was resigned to sign. He said he dictated a memo to file as he had concerns.

[35] While I was not ultimately asked to rule on the validity of the Marriage Contract, based on the evidence, I find that there was no financial disclosure pre-dating or at the time of the signing of the Marriage Contract. The was an attempt to limit the mother from obtaining production or disclosure of the financial statements of the corporation to “limited disclosure of the relevant financial records of the corporation solely for the purposes of verifying the husband’s income as disclosed by his income tax returns, T-4s and other relevant documentation.” In any event, I find that the Marriage Contract is unenforceable and contrary to the Child Support Guidelines and the obligation of the father to establish his income to determine any spousal support or child support obligations after separation.

[36] The father failed, as was his onus, to establish that there was the required disclosure, now established by case law, when considering the validity of a marriage contract. The father called no witnesses and failed to provide any evidence that there was any disclosure whatsoever. He suggested that he did not own the company at the time of marriage and that there was nothing to disclose. His relied on the mother’s statement that he was earning $100,000 at the time as proof of disclosure. This falls far short of satisfying the court that there was adequate or reasonable disclosure.

[37] The father worked pre-marriage and continues do so at W.L. S. and Associates. (“WLS”), which was owned by his father until he acquired the company. W.L.S. manufactures funeral stationery. They produce literature and paper materials for the funeral industry. The father ultimately ended up being 100% owner of WLS through his holding company “Q Development Corporation” (“QDC”). It was never explained or explored why the Share Purchase Agreement between a Mr. Clarence Laing and Joyce Laing and QDC was not executed until December 2008. Similarly, it was never explained or explored why it was in 2006, after the parties’ separation, that the father acquired the shares of QDC.

[38] The father also has a company based in Bermuda Dunes, California.

[39] The mother worked outside of the home until she became pregnant with K was and became a stay-at-home parent after her birth. She obtained her first full-time employment in 2008 and now earns $39,000 per annum.

[40] According to the mother, the family spent five months a year in Palm Desert, California. In fact, the father wanted K to be born in California so she could be a citizen of the United States. The mother complied and gave birth to K in California. While in Ontario, the family spent their summers at a cottage they owned (“their second matrimonial home”) and had a home in Ajax before the father arranged for its sale and the purchase of the Mann property around the period of separation.

[41] The mother alleged that the father planned for the separation unbeknownst to her and did so by selling their cottage and their home in Ajax. He then purchased the Mann Avenue home in Leaside where the mother and K lived. While the home is registered in the joint names of the parties, the father never lived in the Mann Avenue home. The mother signed the sale documents based on assertions that they were in financial difficulty and needed to sell the properties to pay off debts.

[42] Based on the evidence in its entirety, I find that the father planned for the parties’ separation without informing the mother of his plans in an attempt to best protect his financial position and to plan for post-separation outcomes, including the purchase of the Mann property where K and the mother continue to live.

[43] After separation, the father lived at various locations in Toronto, California and Muskoka until he remarried.

[44] In January 2005, the mother retained her first lawyer to attempt to negotiate a settlement, but the father thought that the Marriage Contract would address financial matters and, therefore, there was no need for lawyers. The father ultimately retained counsel who commenced the Application and made the claims outlined earlier.

Progress in Court

[45] In reviewing the Endorsement Volume and the orders made, although the case began in 2006 and with significant financial issues, there appears to have been very little court activity.

[46] On November 19, 2007 the parties agreed to a consent order at a Settlement Conference granted by Herman J.:

a. setting out the Christmas 2007 schedule including permission for K to travel with the father to California to visit her grandparents.

b. parties retaining a parenting coordinator to assist with any access dispute.

c. the father to pay $3,000 per month on a temporary without prejudice basis combined child and spousal support payments in addition to all the bills he has historically paid.

d. The settlement conference was adjourned to December 14, 2007 at 9 AM. [Emphasis added.]

[47] These monthly payments never changed and neither party returned to the issue, as disclosure and establishing the father’s income stalled.

[48] On the return of the Settlement Conference the parties had counsel, while not the ones originally retained and not mother’s current counsel. Herman J. made the following orders:

a. With respect to the information requested by Bonnie Prussky [the expert retained by the mother] dated November 27, 2007, and what followed in the endorsement detailed by reference to a schedule setting out the father’s disclosure obligations.)

b. One of the items of disclosure related to the father’s discretionary expenses paid by the father’s company on his behalf. [Emphasis added.]

[49] The father’s income remained a hotly contested matter, along with the disclosure related to determining his income for trial. Ms. Prussky ultimately prepared her report on August 13, 2011 and provided an opinion of the father’s income for 2010. Her report states that it contains “preliminary calculations.”

[50] On February 11, 2008, Paisley J. granted a Divorce. This allowed the father to marry his current wife, C.Q., and she became employed by the father in his family business.

[51] The father’s Application originally suggested the possibility of a section 30 Children’s Law Reform Act assessment as to custody/access issues was never pursued.

[52] In May 2008, the parents entered into partial minutes of settlement purporting to settle custody and access issues on a final basis although I did not see a court order or court approval of the minutes. The next month the father remarried.

[53] The partial minutes provided:

a. Forthwith, the parties agree to execute the Parenting Facilitator Contract with Joan Sinclair, and undertake to attend at least two sessions with Ms. Sinclair to review the terms of the joint custody arrangement, to work to improve communication skills between the parties, and to schedule occasional meetings with Ms. Sinclair to address scheduling issues such as summer vacations and Christmas holidays. The father was to pay in full for the first two sessions and thereafter he was to pay 60% of the cost and the mother 40% of the cost.

b. The parents were to have joint custody and the father “Regardless of this shared parenting arrangement...was to pay full child support.”

c. The section on residence provided:

1. K was to reside in the homes of each parent.

2. If possible, one of the parents will maintain a residence in the child’s familiar neighbourhood at all times;

3. The two residences of the child will remain in the Greater Toronto Area.

4. If a change of residence is contemplated by either party, the parties agree that the parent proposing the change will give the other a minimum of sixty days written notice before the proposed move in order to review and reassess the current time-sharing schedule in light of the proposed move (such notice to be provided upon these terms unless the parties agree otherwise in writing beforehand);

5. If [the parents] are unable to renegotiate as between themselves the time-sharing schedule in light of the proposed move, then they shall forthwith enter into the dispute resolution protocol set out [it called for mediation and if not so resolved to apply to the court];

6. The week-about schedule was established with the switch to take place Monday afternoon. It also provided for the non-residential parent to have dinner each Thursday and to have K from after school and returned to the other parent’s home by 7:30 PM.

7. The Holiday schedule was provided and it contemplated the use of the parenting facilitator, if necessary. (I should note that long weekends would not be treated differently; it required the same return time “unless the parents agree otherwise beforehand”).

8. There was a section on education, insurance and Aeroplan miles.

9. Telephone contact with child daily was contemplated at 7:00 PM with the parent whose week it was not. [Emphasis added.]

[54] I heard little evidence related to the notice, if any, given about the father’s move to Waterdown. The mother suggested there was no notice.

[55] The father’s evidence regarding the Parenting Facilitator, Joan Sinclair, was that “we didn’t necessarily see eye to eye” and the parties stopped using Joan Sinclair. Although they thought they needed a parenting coordinator, the person whom the mother suggested wanted too much money and the father did not see it necessary and thought the amount requested was a lot “without an assessment.”

[56] The father said that his new wife found someone else at a lower cost and did not require a retainer, but the parties could not agree.

[57] The father’s new wife testified that she and the father were engaged in 2005 and married June 7, 2008. She confirmed that she and the father would decide where they would live once the trial was over. This was consistent with the father’s evidence.

[58] After the father’s remarriage he continued to live in California for four months, returning with his new wife to exercise his alternate weeks with K. In Ontario, he lived in Toronto or Muskoka until he and his wife decided to move in with his wife’s parents in Waterdown, in the fall of 2009. However, in 2010, his company still paid for several months of his accommodation. The father’s expert in his income critique reported that the father’s company paid for 90 days of accommodation in 2010 at 61 Yorkville Avenue. These contradictory statements were unclear and not reconciled. It is also unclear whether the father took K to Yorkville Avenue or Waterdown during his time with her.

[59] The father did not call his new in-laws and had no plans to call his wife. In submissions he wanted to tender letters but I did not allow this. The father testified that he contributes to the cost of food in Waterdown, but pays no rent to his in-laws.

[60] The father concedes that he and the mother have “vastly different parenting styles” but that shared custody has worked out “very well.” “[K] gets to spend a lot of time with my wife’s family.”

[61] He concedes that he does not see his mother (K’s paternal grandmother) or his father (K’s paternal grandfather) a great deal.

[62] He said that he and his new wife “parent K together.”

[63] I did not have the benefit of independent evidence relating to the parenting issues. The father professed to following K’s voice, but I was satisfied that given the evidence it would be unfair, counterproductive and contrary to K’s best interests to place pressure on her, to have her come to speak with someone for the first and only time at trial

[64] Although the father recognizes that his relationship with the mother is “strained and acrimonious ... and strained for eight years,” he believes that K loves the current routine.

[65] He conceded that he and the mother have very poor communication but he suggested “we are in the middle of a divorce.” He was hopeful that it will get better “after trial.”

[66] He justified his move to Waterdown by suggesting that it is part of the GTA.

[67] I do not know by whose definition that might be; however, when reading the partial minutes of settlement in their entirety I conclude that a reasonable expectation contemplated that the parents’ residences would be close to the existing Mann home and neighbourhood school, and would allow the parent whose week it was not to have the child on Thursdays from after school to 7:30 PM.

[68] I find that this could not reasonably be consistent with a move as far away as Waterdown (some 70 km away). When the parties agreed to the week about parenting time K was, as she is now, going to school in Toronto. The father’s decision to move to Waterdown while wanting to continue a week-about arrangement cannot be considered a decision based on the child’s best interests.

[69] The partial Minutes of Settlement appears to be another agreement (like the Marriage Contract) where the mother complied with the father’s request in good faith and he took advantage of it, by failing to live nearby or follow through with the parenting facilitator.

[70] By December 17, 2008, the mother had retained her current counsel, for whom the father did not hide his dislike.

[71] On December 17, 2008, Herman J. conducted a Trial Management Conference and largely dealt with financial disclosure issues and ordered each party to provide disclosure by February 6, 2009. She adjourned the matter to February 25, 2009 at 9 AM.

[72] The trial was delayed with the disclosure issues still outstanding. The father’s income was a very significant issue and the mother’s expert needed disclosure.

[73] The father had the obligation to satisfy the court as to his income. He should have been the one who hired the expert as early as he commenced his application to start the process of providing an income analysis that if necessary would have been critiqued by the mother’s expert. No doubt his experienced family counsel would have so advised him.

[74] Without appropriate evidence as to his income, the November 19, 2007 without-prejudice order could not be revisited.

[75] On October 13, 2009, Horkins J.’s order allowed the mother to access her equity in the Mann property to fund her valuation and legal fees. Disclosure orders were once again made and a Settlement Conference was set for February 24, 2010.

[76] As it turned out, the report and evidence of Bonnie Prussky as to father’s income was for only the year 2010. By 2010, the facts changed from when Ms. Prussky was first retained. These changes included certain arm’s length employees being replaced by his new wife and paid a salary that would reasonably be questioned given her lack of experience and her replacing long-time employees. These were all decisions made by and in the control of the father.

[77] The father conceded that Ms. Prussky had been retained by the mother’s previous counsel over five years ago, in 2007, and perhaps as early as 2006. Ms. Prussky’s report was dated August 3, 2011.

[78] The father sought an ex parte order to allow to him to enroll K in private school on March 10, 2011, but the request was denied and the motion adjourned. At trial, it appeared that this motion never came to the attention of the mother or her counsel of record.

[79] On August 12, 2011, Mesbur J. conducted a Settlement Conference and endorsed:

Settlement is unlikely. Case should go to trial as soon as it is trial ready.

Order to go as follows:

(1) Questioning for both parties to be conducted and completed by October 14, 2011.

(2) All undertakings to be answered by November 10, 2011

(3) If applicant (the father) intends to produce an expert report in response to Ms. Prussky’s report (dated August 3, 2011) he shall do so by November 30, 2011. [It turned out that Mr. Brooks’ report is dated November 30, 2011.]

(4) Trial Management Conference December 12, 2011. Each Party to serve and file a Trial Management Brief including:

(a) An opening statement

(b) A list of every witness the party intends to call with a “will say” statement for that witness and a reasonable estimate of how long that witness’ evidence will take including examinations in chief and cross. Time estimates are also required for opening and closing submissions.

Parenting Issues

[80] There is little doubt that both parents love and adore K. They are also proud of her and no doubt want the best for her.

[81] By all accounts K loves both parents and enjoys her time with each parent. The Mother’s Day cards prepared by K for her mother and the father’s new wife C.Q. (C) tells me a lot about K. She wishes to please both her parents.

[82] The cards are identical in most ways. One is addressed to “Dear C” (addressed to the father’s new wife) and the other “Dear Mom” addressed to her mother.

[83] There were subtle differences. On C’s card, K wrote, “I love you so much we have a great family. All we need is a dee (not sure if what follows are “t” or “l” and exclamation point). For her mom, she wrote, “We have the best family ever!”

[84] I also saw a birthday card presented to C.Q. by K. for “C” with a picture of K and her for her 29th birthday. “We love you with all our hearts. You bring Joy and Happiness when you are around. We wish we could be with you day and night. You are one of the best things that ever happened to us! We will love you forever.”

[85] I was also shown a letter from K to her mother accompanying a “reward”:

You deserved this reward because it is true you are the world’s greatest mom! You are the best! Thank you so much for bringing us to Florida and bringing us to all the themes parks. Thanks for being the 1st mom! I love u so much I can’t put it in words. I love u so much and I can’t tell you how much I want to be with u all the time. I just wanted you to know that your daughter loves you so much! I hope you like this gift and we will have a great trip! Love K.

[86] The parents are fortunate to have a child who loves and appreciates each of them.

[87] Family law has evolved to the point that fewer cases need court intervention and parents are able to resolve matters of parenting on their own or with some help from family lawyers, mediators and knowledgeable and helpful child experts.

[88] Although the parents recognized the possibility that they might need help or assistance with some issues, after the May 2008 agreement no one pursued any assessments or the continued involvement of identified professionals.

[89] Instead they have now left for me to sort out their parenting issues.

[90] Since 2009, they have lived in the current arrangement that while maintaining a week about schedule, I find, was otherwise not consistent with or in the spirit of their partial minutes of settlement. They may have joint custody in name, but they hardly have good and healthy communication. The father’s unilateral move to Waterdown, I find was contrary to a reasonable interpretation and understanding of the partial minutes of settlement. The unnecessary imposition on K to travel twice a day in alternate weeks through rush hour traffic from Waterdown, including some days where she attends some extracurricular activities selected by the father cannot objectively be considered sound parenting judgment. In considering all of the evidence this serves the father’s needs and not K’s best interests.

[91] I heard evidence that the father and his new wife are dismissive of and exhibit inappropriate behaviour towards the mother. I have also heard evidence that the mother failed to address her legitimate concerns about the father’s move to Waterdown, which speaks to mother’s willingness to put her daughter ahead of herself and until now put up with uncooperative parenting. I find father and his new wife’s actions and words are contrary to being good co-parents. This raises for me concerns about the future unless there is a serious effort by the father and his new wife to recognize that their treatment of the mother and how they interact with third parties (schools, mother’s family and others) meets their own needs ahead of the child’s. This is not in their child’s long-term best interests.

[92] If not for the mother’s continuing willingness to continue joint custody, willingness to reconsider private schooling as promoted by the father, and willingness to maintain the week-about arrangements if the father moves closer to the child’s Mann residence, I would have considered significantly changing the schedule and perhaps not approving the joint custody.

[93] I say this now, because the father and his new wife should not take from my decision any approval of their words or actions. If they continue to act and speak as I heard during the trial, I would not want another judge, who might consider the parenting issues in the future, to ask, “If these issues and concerns existed at trial, why did the trial judge maintain the joint custody and schedule?”

[94] While C.Q. and her parents have become important to the father and K, they are not a replacement or a substitute family. They no doubt are and should continue to be an important part of K’s life. The mother should not be thought of as less important in K’s life. The mother has been her primary caregiver for many years. The new wife, the father and others important in K’s life need to act and speak civilly and respectfully to and about the mother and her family. To do otherwise is contrary to K’s best interests. This should apply to all communications including text and telephone. K should not be placed in situations where she has to choose whether the parenting schedule is followed or she has to choose her loyalties between her mother and others. This is a mutual parental obligation.

[95] Family judges and family law professionals want parents and their extended and new families to resolve parenting issues without resort to court, but not at the expense of the child’s best interests. The resolution must be in a manner that focuses on the child’s needs

[96] K is fortunate to have loving parents and should not be put in a position of having to choose sides. She is fortunate to have a father who has had good luck, skills and strengths that have contributed to his healthy financial position. In addition, he has had the generosity of others (his new wife’s parents) who appear to offer much for K that many children do not have. This appears to have created an inequity between the homes. This inequity should not be used to possibly negatively influence a child against a good parent such as the mother. Any attempt to do so does not reflect well on a parent who would allow this and it is contrary to K’s best interests.

[97] The father has choices.

[98] On one hand, much to the credit of the father he has maintained his commitment to a week-about schedule for K, but his current Waterdown arrangements (no doubt a fun and enjoyable place for K and convenient and financially advantageous to the father and his new wife) cannot be in K’s best interests during the school year and, as I have found. it is contrary to any reasonable reading and interpretation of the partial minutes of settlement. The father concedes that he has delayed the decision about where to live until the outcome of this case. It appears that ideally he should reside in Toronto. He has choices and can control where he lives. He has managed to do so in the past and I see no reason why he needs to live in Waterdown. His summers are spent in Muskoka and he spends January to April in California. His business’s head office is in Ajax. His daughter’s school is in Toronto, as is St. Clements where he would like his daughter to go to school. K’s mom lives in Toronto in a home she will be retaining and where the partial minutes of settlement contemplated both parents would live near.

[99] To the father’s credit he maintains his connection to K’s school and attends her activities. The father clearly has demonstrated that he is able to find and fund suitable accommodation when he wants to. He has postponed finding permanent residence awaiting the outcome of trial. I find that if he wishes to maintain the current week about schedule he is able and should make that happen. I find that it is in K’s best interests for the father to live closer to K’s school at all times during the school year at a distance that will allow K to participate in extra-curricular activities during the week and perhaps weekends and to not have to wake up earlier than she might otherwise need to. This would end the unnecessary long car drive daily each alternate week during the school year. This would also allow the midweek visit when the child is in the other parent’s care.

[100] While not restricting the area, it would be inappropriate for the father to move within four square blocks of the mother, but reasonable for him to consider moving in an area roughly between Bathurst Avenue on the West, Don Mills Road on the East, Wilson on the North and St Clair/Moore Park on the South to maintain a week-about arrangement, including the contemplated midweek time.

[101] The father wanted K to go to St. Clements School on St. Clements Avenue in Toronto. The father was very angry that the mother did not agree to allow K to go to St. Clements when she had agreed to allow K to go through the process of visiting the school and applying. The mother testified that she was prepared to consider St. Clements in the future. She cooperated in the St. Clements admissions process but was upset that prior to her approval the father celebrated K’s attendance with a party for her. The father and his wife do not hide their disapproval of K’s current school and their disappointment over the mother’s unwillingness to go along with St. Clements. I find that it is reasonable to conclude that K would be aware of her father’s unhappiness, as the father and his wife would not hide their disappointment from K, thus placing the mother in a negative light.

[102] The father was prepared to find the $24,000 per annum that it would cost to have K attend St. Clements. He went as far as attempting to bring a motion without notice to have the court approve the enrolment that was denied. He never tried to bring the motion on notice. The mother is prepared to consider St. Clements perhaps in two more years when K would be scheduled to enter Grade 7.

[103] The father blames the mother for leading K to believe that she would be going to St. Clements by taking her for the entrance examination and then asking the school for an enrolment extension. At first, he wanted me to give him the authority to enroll K in St. Clements at the earliest possible date as “it is where the child has the best chance to excel, it is where [the mother] has indicated possible agreement in Grade 7 and most importantly where K wants to be.”

[104] The father recognized that it would preferable for him to relocate closer to the mother’s residence but suggests that there is no evidence that this would be in K’s best interests. As I have found, I find that it would be in K’s best interests that to continue the alternate week schedule during the school year, that it is in K’s best interests to have the father move closer to K’s school and mother’s home on Mann.

[105] The father’s lack of insight in equating his admitted control in family and parenting relationships to the role of others in very different situations is worrisome on many levels but significantly when it comes to joint decision-making as co-parents or joint custodial parents. He has demonstrated a failure to appreciate what it means to joint or co-parent when attempting to get an order without notice to have the child go to the school of his choice, when failing to return K to the mother on Victoria Day as will be described later, in making unilateral decisions concerning what activities the child is involved with after school, and in moving to Waterdown and failing to comply with notice requirements.

[106] The father and his new wife’s emails to the mother are worrisome.

[107] The father was clearly disappointed that the mother would not go along with his view that K should go to St. Clements. Emails reflect this disappointment.

[108] In a particularly inappropriate email dated November 23, 2010, apparently prompted by mother’s lawyer’s letter of the same date, the father emails:

Glad you put yourself ahead of K and her education. Do you want her to grow up just like you? I’d like her to be independent and not some money grubber like yourself. Let’s send her to dunbarton. Worked out well for you and J. Why don’t you ask the teachers at Manor what they really think of you. Pretty sure from what they’ve told me, you would get an eye opener. How many times do I have to whip your F-g pathetic toad of a lawyer before you get it. I’ve got more intellect in my left nut than that F-g loser has in his entire per brain. Glad to help you blow through more of your nest egg. Ask Big Jen about that.!

[109] On August 23, 2011, C.Q. (father’s new wife) and the mother had an email exchange apparently over K’s hair. C.Q. emailed the mother about how to take care of K’s hair and the mother took exception:

Who do you think you are? Do you really think this is productive? You really need to get something straight, custody is between her father and I...period. Your “assumptions” and “judgments” are irrelevant.

Do not e mail me again. If there are “legitimate” concerns about K’s “well being” or for anything concerning K her dad should man up and contact me.

[110] C.Q.’s email reply of that same day:

Your threats and hostility towards any suggestions that K’s well being grows very tiresome. It has actually become somewhat of a joke between K, G. and I that she constantly comes back home with extremely knotty hair. K actually takes great pride in herself once we have washed, and brushed through her hair, something that we feel is very important in K’s overall self esteem and development. I’m sorry that your insecurities as a Mother tend to, quite often, over shadow the fact that we were asking something very simple from you.

Anyways, you can continue to live in your little bubble of being enabled by those that surround you. Like I have said to you before, I love K like she is my own, and I will continue to treat her that way until I die.

Do not even talk to me about G. “manning” up, look around, I would say you are living in somewhat of a step up from your life and townhouse in Pickering, where you came from.

I will take it as a yes that it is ok to take K for a trim, (a request that you chose to ignore) and I will continue to always give K the TLC and attention that she deserves. You don’t need to give birth to know how to do that.

Thanks again for always being so easy to work with. Greatly appreciated.

[111] Emails in March 2012 over travel consents between mother and C.Q. were very concerning and do not bode well for communication. It also is consistent with the little, if any, respect there is between C.Q. and the mother. The emails leave me concerned that C.Q. and the father share their views about the mother with K.

[112] Until the Victoria Day weekend May 21, 2012, to my knowledge, the father always drove K back to Leaside after his week.

[113] To my surprise and disappointment, on Tuesday, May 22, 2012, I heard evidence that K was not returned to her mother’s home as she was supposed to be on Monday 21, 2012.

[114] K and a friend from Toronto had spent the weekend in Waterdown.

[115] The mother expected K’s return as usual with the father dropping her off at the mother’s home.

[116] The mother emailed the father in the morning and asked what time K would be dropped off.

[117] Father emailed back to say:

K has expressed her desire to spend the night here tonight and have us drop her off at school in the morning. I tell you this in advance of her calling you so that you have notice and are not caught off guard. The choice is yours whether you respect K’s wishes or not. Should you decide that you wish K returned to day, you may meet us at the 400 and 407 where D [her friend’s father who I was advised lives near the mother] is picking up A [K’s friend]. K will call you shortly. On another note K informed us that you have decided to take away her new puppy. Is that true?

[118] The mother promptly replied by e-mail:

Have K at my home at 4:00 PM. Thanks you. Do not have K call me.

[119] The father replied:

We are not coming into Leaside today. You can get K from our house or like I said in my last e mail, where D is meeting us. Let me know your choice. I believe you already are aware of K’s.

[120] Father was wrong to not follow the agreement. I am not sure how, for the first time, in the midst of the trial, it is alleged that K was the one who initiated not wanting to return to her mother’s home. I find that it was wrong of the father, who is a person of considerable persuasive abilities, to have allowed this to happen. Even if K had expressed this wish independently, I am confident that if the father wanted to he could have returned K as he had done many times before and simply said, “K, you know the routine and you are scheduled back today. It is the right thing to do and I will take you back like I always do.” This issue should have never happened.

[121] The father showed poor judgment and acted inappropriately.

[122] He was wrong in attempting to have K speak with her mother since he knew what the mother’s position would be and he should have supported the mother and recognized the need for him, as a parent, to stand by their agreement. He was sending the wrong message to K and setting the mother up.

[123] When he had suggested throughout the trial that there was no problem on his end in taking the child to Leaside from Waterdown, this time he created an embarrassing situation for the mother, the child, the friend and the father’s friend.

[124] The mother gave in and showed good judgment in the end by attempting to end this confrontation. She had no court order but just the expectation that the father would live up to the agreement that he sought to maintain at trial and suggested that it met K’s best interests and the drive was not too long or an issue.

[125] The mother did not call the police but went to meet at the Vaughan Mills Shopping Centre.

[126] When she arrived, K, C.Q., and K’s father were all there and K was crying. Rather than the father and C.Q. encouraging her (if K needed it), and I accept the mother’s evidence as she described it, father was hugging K as she cried and then for a while the mother and father walked away from the car to give K a moment.

[127] When the mother attempted to speak with K privately, C.Q. began videotaping what was taking place. That was very poor judgment.

[128] The mother ultimately acted responsibly, and in K’s best interests, the mother backed off and allowed K to return with her father to Waterdown.

[129] The next day, the parties returned to court and I heard evidence from each parent as described above.

[130] The mother believed that the father took K to school that morning and said she received a call from the school principal but because of the court proceedings, she did not call the principal back immediately. It was not until the father gave his evidence that the father informed me and the mother that when he and his wife took K to school she was still upset and crying. The father took K to the principal’s office and said that K was complaining about being frightened of her mother.

[131] The father suggested he did not know what to do but because K was still upset he decided that instead of leaving her at the school, he had his wife take her to a park while he came to court.

[132] I was very concerned about what I heard and advised the father that I wanted K brought to court. I find the father’s and his new wife’s conduct inappropriate and they created a situation that showed poor parental decision.

[133] I took a recess.

[134] I returned to the courtroom and was advised that when the father reached his wife on the phone that she was on the way to return the child to the school.

[135] Had I known that the child was being returned to school, I would not have asked her to be brought to court.

[136] I concluded that the child had been through enough. It was not my intention to speak with K. I directed the parents to speak with her and to have the mother return her to school.

[137] When I heard submissions later that week, no one suggested that there were any issues with the child at school or with her mother.

[138] The father has on more than one occasion mentioned the child’s voice. These parents had opportunities during the period from separation to trial to consider a section 30 assessment and the OCL. They also briefly engaged the services of a parenting facilitator. I was not prepared based on the evidence I heard and the events of the Victoria Day weekend to put added pressure on K with a single opportunity to meet the judge. I was, in the circumstances, concerned about the pressure K would feel if she felt a need to choose between her parents or to say something in support of or complain about a parent. I was satisfied that in this case the risk associated with speaking with K outweighed any benefit and was contrary to her best interests.

Disposition of Parenting Schedule

[139] I will allow the continuation of the current joint custody and the balance of terms only but subject to review at the instance of either party, but not earlier than June 2013 unless there is urgency requiring a best interest intervention. This judgment outlines my concerns with joint custody. I provide for a potential review to give the court another opportunity to look again and to address the concerns I have outlined, such as to see if there remains a continuing undermining of a parent’s relationship with the other parent, continuing disrespectful communication, the creation of situations that put K in the centre of any parental dispute, or instances where the court order was not complied with.

[140] Unless the father moves or arranges suitable accommodation living within a short distance to the Mann home and K’s current school by no later than Labour Day 2012, the week-about schedule shall end and be replaced by the following schedule:

1. For the school year (September to June) commencing September 2012, the father’s time with K during the school year shall change. The school breaks at Christmas, March break and the summer may remain as is and shall be incorporated into an order for completeness.

2. The father’s time shall be alternate weekends. The mother will have the last week of this summer to and including the weekend leading up to the first day of school so that K goes from her mother’s home until the weekend following and alternating weekends thereafter. The father is to have K after school on alternate Fridays to Sundays at 7 PM, with her father picking her up and returning her to the mother’s home.

3. The weekend of Mother’s Day will be the mother’s and the weekend of Father’s Day the father’s. Weekends as they fall will be extended to Mondays at 7 PM if it is a Holiday or a PD Day.

4. The issue of school change shall not be subject to discussion unless the parents agree in writing to consider earlier than nine months prior to K entering Grade 7. If the parties do not agree to a change of school, then the parents are to consider an educational assessment with the goal of getting a recommendation in K’s best interests as to where she should go to school. A report should be available by January preceding the September prior to Grade 7, so that if the court is needed to decide there will be sufficient time to set a hearing date.

5. If the father will be moving to an area as earlier referred to (near the Mann home or K’s school) he shall give the mother notice forthwith and provide details of where he will be living and as well advise the school.

Support and Father’s Income

[141] Father’s income determination was an issue throughout the post-separation period that was recognized as critical and difficult.

[142] Unfortunately, this case is yet another case where a self-employed individual who controls several corporations (in this case in Canada and the United States) fails to recognize their obligations and that they have the onus to establish to the court’s satisfaction their income for support by the Child Support Guidelines and Spousal Support Advisory Guidelines.

[143] It is not appropriate to make the other spouse seek disclosure for their expert retained to do an income analysis that is then critiqued by the spouse whose responsibility it was all along to make the relevant and necessary disclosure. It puts the wrong person to the expense and allows for delay.

[144] Perhaps, at first, the father may have mistakenly believed that the terms of the Marriage Contract he relied on that attempted to limit financial disclosure would allow him to delay or avoid the disclosure required to determine his income. Given the lawyers he originally retained, I would be surprised that they would not have dissuaded him of that belief.

[145] Although Ms. Bonnie Prussky of AP Valuations had been retained for many years, it was not until August 3, 2011 that she was able to produce an expert report giving an opinion of the father’s income for only one year (2010). By that time the father had made changes in his company and even his expenses. Two arm’s length and long-time sales people ended their employment and were replaced by the father with his new wife who was inexperienced yet earned immediately a significant salary determined by the father. In addition the father appeared to have stopped expensing some of his Ontario accommodation expenses through his business and now lives rent free with his new in-laws. He seems to continue to expense some accommodation in California.

[146] These issues must be considered in the context of the five-year court process and seven-year separation by the time of the report. Each of the parties asks that I give some retroactive relief on spousal support, but all I have are competing expert opinions completed in 2011 for 2010 income.

[147] The father’s expert, Mr. Bruce Brooks of Collins Barrow Chartered Accountants, was only retained by the father to do a “limited critique report” to address Ms. Prussky’s report. According to his evidence, he was directed by the father to address three issues: C.Q.’s income, an apartment lease and discretionary expenses to add back.

[148] Mr. Brooks was the father’s only witness in addition to himself.

[149] The AP (Prussky) report provided an opinion that the father’s income for support purposes in 2010 was rounded to $368,000.

[150] The Collins Barrow (Brooks) report adjusted for “excess income paid to C.Q., an apartment lease that was no longer maintained, an adjustment for a vehicle used by the mother and the tax gross-up adjustment”. Relying otherwise on the AP report and with these adjustments the Collins Barrow report provided an opinion that for 2010 the father’s income available for support in 2010 was $246,675.

[151] In spite of the father’s vigorous cross-examination of Ms. Prussky and a review of the Collins Barrow report, Ms. Prussky stood by her opinion.

[152] The father’s cross examination attempted to suggest that Ms. Prussky failed to make a thorough investigation.

[153] One critical piece of evidence was the information provided to each expert by a Mr. Steve Parker, the external accountant for the father’s company. According to Bonnie Prussky, Mr. Parker advised her that “Mr. Q. income splits with his wife.” Ms. Prussky stated that “we have assumed that 33% of Ms. Q.’s income should be attributed to Mr. Q, which as she put it, was a conservative amount.

[154] Mr. Brooks’ report stated, “We have also spoken with Mr. Parker and he advised us that he made no such statement. He indicated that Ms. C.Q. is very involved with the business, in a sales capacity having replaced two former sales people. He indicated an annual salary of $100,000 would not be unreasonable.”

[155] Although Mr. Brooks requested documentation as to how her salary was calculated in each of the years, none was provided.

[156] The father reported to Mr. Brooks that Ms. C.Q. “had taken over the clients of two former sales persons ... who in 2007, had combined commission income of over $160,000.”

[157] Mr. Brooks wrote that “Based solely on the above background Ms. Q.’s actual remuneration appears to be at fair market value.”

[158] Experts rely on documentary information and information received from individuals. They apply that information to make calculations based on their expertise.

[159] It was the father’s responsibility to provide each of the experts the necessary documentation that an expert is of the opinion is required to support their conclusions. In the end, where there is a dispute over the facts, I, as a judge, need to draw conclusions on the facts in dispute in the experts’ reports. The control of the evidence as to the areas in dispute was with the father. As I again repeat, he had the onus to satisfy the court on the facts and provide an expert report as to his income for guideline purposes.

[160] The father failed to do so. He did not call his accountant, who could have provided critical evidence on many issues and in particular the statement attributed to him by one expert and denied by the other. He could have provided factual information about incomes, expenses and how income allocation and expenses are determined.

[161] He could have provided, if backup documents existed, evidence as to how C.Q.’s income was supported.

[162] It was not up to the mother or her counsel to attempt to prove what was in the control of the father.

[163] Ms. Prussky’s report provides an outline and explanation to allow me to understand the father’s businesses and sources of income.

[164] Ms. Prussky explains that the father owns 100% of the common shares of QDC, an inactive holding company which owns 100% of WLS.

[165] She explains that the father acquired his shares of QDC in 2006 (post-separation) when the former shareholders exchanged their common shares for fixed value preferred shares.

[166] The preferred shares are held by the father’s father and a Mr. Laing, the former Chief Financial Officer, and Ms. Joyce Laing. The total redemption value for all preferred shares is $1,650,000. The father has Class “A” preferred shares with a redemption value of $1,210,000.

[167] The father also owns 80% of QDC International, an inactive holding company which had no income or expenses for the period 2002-2009.

[168] WLS is an active operating company founded in 1948. It specializes in the graphic arts requirements of the funeral industry, including a publishing division. It also provides some printing outside of the funeral industry. Its head office, manufacturing and administrative offices are in Ajax, Ontario and it has a sales and marketing office in Bermuda Dunes, California. The father is the Chief Executive Officer and, according to Ms. Prussky’s report, divides his time equally between the Ajax and California offices.

[169] Ms. Prussky explains adjustments made to the father’s 2010 line 150 income to determine his income as guided by the Federal Support Guidelines.

[170] The categories of adjustment were noted as:

o Home Buyers Plan/RRSP payment.

o Income paid to related parties.

o Discretionary expenses

o The related income tax gross-up was calculated (for the above three adjustments).

[171] The father’s 2010 income as reported on his personal income tax return as the starting point was $157,689 of which the Home Buyer’s Plan repayment was $1,331.

[172] Without the gross up on discretionary spending, Ms. Prussky added back $30,093 under the category of income paid to C.Q., $54,000 for an apartment lease, $9,600 for golf club fees, $23,848 for travel expenses and $10,800 for the mother’s leased vehicle. The travel expense added back as personal was 50% of the costs of travel, including meals, fitness membership, overnight stays in Toronto, and golf club fees. She noted that the gross profit for the California office in 2010 was approximately $96,000 “which appears low given the costs associated with running the office and expenses incurred there.”

[173] The father made much of the assumption that Ms. Prussky allocated $54,000 to the Toronto apartment lease at $4,500 per month when he did not lease for the entire year.

[174] Ms. Prussky reviewed the Amex statements for the period December 2009 to November 2010.

[175] The father noted the expenses on Amex statements and how they were allocated when giving it to his accountant for preparation of financial statements and personal income tax returns.

[176] In schedules attached to her report she provides a schedule of income and expenses, retained earnings, and balance sheets for WLS from 2003 through 2010. She did the same for QDC.

[177] Mr. Brooks was the father’s first witness. His evidence was limited by what he was asked to do which I find was to provide new calculations based on what he was directed to do by the father. In cross examining Ms. Prussky, the father was critical of her lack of investigation and the fact that she made assumptions. I do not find that he can be critical of what she did given the information he provided and most importantly because he was the person who was in control of the information and had the onus of proof.

[178] I find that he failed to satisfy me that a conservative add-back of C.Q.’s income for income splitting was not an unreasonable conclusion.

[179] Given father’s travels and expenses to support his and his wife’s spending during the winter months in California, adding back 12 months of lease expenses may not have been warranted. Nevertheless, the accommodation costs either in Ontario or elsewhere that are expensed remain a consideration. Mr. Brooks conceded that AP would have looked at expenses in the company but he did not.

[180] The father did not call the two individuals whom C.Q. apparently replaced. What is very clear is that the father is the person who makes all major decisions and controls allocation of expenses between personal and business. He uses credit cards extensively and then writes down the allocations. The fact is that his decision to eliminate arm’s length employees and replace them in either name or in terms of actual work performed by his new wife C.Q. meant that overall family income increased based on what he decided would be paid to his new wife.

[181] It was only as a result of the mother’s counsel calling C.Q. that some material was first disclosed in an effort to substantiate the work she does for the income assigned to her by the father.

[182] The father conceded that for three months in 2010 he rented a furnished rental accommodation and charged it to the business. The father wants me to use the income figure advanced by Mr. Brooks, who by his own admission was not providing an income analysis, but critiquing one.

[183] The father suggested in his closing submissions that the two experts’ conclusions were very similar except for the rental and income splitting issues. He suggested that Ms. Prussky’s assumptions were clearly inaccurate. He claimed that she embellished her findings while under cross examination by reference to cottage rental expenses that were being expensed but not in 2010, the year for which she was providing her opinion.

[184] The father conceded that he did charge three months of rental expenses in 2010. He criticized Ms. Prussky for failing to speak to C.Q. who he stated “started legitimate employment with the company in 2008 and was remunerated according to historical industry and company standards.”

[185] He also criticized Ms. Prussky for not speaking with customers, employees and current or past sales representatives.

[186] He praised Mr. Brooks for his clear and concise evidence.

[187] While the father is articulate, well prepared and bright, he is not independent of the issues. Once more, I repeat, the father had the initial and ongoing obligation to satisfy the court as to his guideline income. He should have hired his own expert to do the income analysis and provided the expert full access to his accountant and all the individuals he now suggests Ms. Prussky should have talked to. He never instructed Mr. Brooks to counter Ms. Prussky’s analysis with a full analysis. He did not call his accountant or any other witnesses to provide factual evidence to challenge Ms. Prussky’s assumptions or to support statements that his new wife is being paid by “industry standards.”

[188] The father was in control of expense and income distribution. He was in control of how he managed his end of the court process, who he would and would not call, and who would be subject to cross examination. He failed to satisfy me as to his income for any year.

[189] He concedes that he expenses some portion of his California accommodation and travel expenses. There remains much questionable allocation of expenses to the business that might otherwise be added back to father’s income.

[190] I also find on the evidence I am satisfied it was reasonable to conclude that there was income splitting. The father’s failure to call his accountant on what he actually told the experts, his lack of supporting evidence as to how he calculated and justified his wife’s income allocation, and the strong evidence that the father makes all decisions and controls allocation and finances all support adding back for income splitting.

[191] I understand the frustration of the mother and her counsel as it was not for them to establish his income and wait for disclosure.

[192] The evidence is consistent with a finding that the mother was employed outside of the home and not in the father’s family business until she became pregnant with K approximately 11 years ago.

[193] Thereafter until after separation she did not work. Like the father does now with his new wife, the family of K and her parents travelled often for long stretches in California and Muskoka.

[194] I am satisfied that the mother took reasonable and appropriate steps to re-enter the world of employment and based on her education and experience has done well.

[195] Both parties seek to address the fact that there has never been a determination of incomes of either party and in particular the father’s income so as to fix an appropriate level of child and spousal support. The father, having failed to establish his income, now seeks some retroactive adjustment or recognition for income tax purposes the financial contribution he has clearly made to the wife since separation.

[196] While the father took steps to provide accommodation for the mother and K, I have found that he did so in an attempt to control outcomes consistent with his post-separation plans of where K would live and what he might provide financially. He submitted that from July 2004 until July 2006 he voluntarily paid to the mother amounts that at times were in excess of $10,000 per month without any tax consequences to the wife, which he now suggests should be allocated to spousal and child support. Among other things, the father paid the mother’s credit card expenses, for household expenses, for repairs and maintenance, for her vehicle, and for K’s tuition, uniform, activities and clothing. The school related expenses ended when K started her current school.

[197] On November 17, 2007 the parties entered into a consent order, without prejudice, and the father agreed to pay $3,000 per month (he in fact paid $750 per week) and also agreed to pay what he had “historically paid.” The mother confirms this but states that she pays certain amounts related to the home. She concedes that the father’s contribution perhaps totals approximately $6,000 per month.

[198] As outlined in the section on endorsements and court orders on October 13, 2009, an order was made to allow for a secured line of credit to be obtained on the Mann property to allow the mother to fund Bonnie Prussky’s income determination. When she obtained the funds, she discovered that the father had failed to pay the property taxes and this had to be added to the line of credit.

[199] At the commencement of trial the mother advanced a claim based on the father’s income at $350,000 and her income of $35,000. She asked for child support of $2,734 per month and based on the Spousal Support Advisory Guidelines asked for mid-range spousal support of $8,374 per month. Based on what she alleges was a serious underpayment of support, she asked for a lump-sum payment to be paid after time-limited spousal support.

[200] At the conclusion of trial the mother’s position changed, She asked that I find the father’s income to be either $368,000 as calculated by Ms. Prussky or $400,000, and that the mother’s income to be $39,000. She also asked that I use the midpoint range of spousal support according to the Spousal Support Advisory Guidelines and child support without adjustment for any shared residence. The mother’s counsel suggested an additional three years of spousal support and then another three years to compensate for any underpayment retroactively. Mother’s counsel initially asked that what would be calculated as six years of retroactive adjustment of support for a range of $250,000 to $300,000 be awarded as a lump sum payment and paid after the three more years of spousal support, but paid monthly at $8,000 per month over an additional three years. However, mother’s counsel later recognized the possible tax implications and in order to compensate for any retroactive arrears suggested that he would be satisfied with six rather than three years of spousal support for the same reasons.

[201] The father asked that I find his income to be $246,676 which would result in $1,627 per month child support and a mid-range spousal support of $5,286. He submits that since 2006 he has paid $6,000 per month combined child and spousal support and if child support should have been $1,627 then the allocation to spousal support of the total $6,000 would be $4,373 per month. Since he received no tax deductibility for this amount he suggests that using his marginal rate of 46% equates to $8,000 per month in “pre tax Spousal Support.” This fails to consider the net disposal income each might have based on the spousal support he might have paid on a periodic basis based on his ability to claim a deduction and what the mother might have by declaring the support plus whatever income she otherwise had year to year. I was not given accurate yearly calculations. The failure to address these issues in a timely manner makes it impossible to do a fair or accurate retroactive calculation.

[202] He submits that there is no basis for any retroactive support and there is no evidence that K has suffered due to a lack of support and the mother never asked for an increase.

[203] He submits that spousal support should end and that the mother “has had ample time to become self sufficient, ... is now gainfully employed in a position she has enjoyed; her employment future is bright and her income will only grow.”

[204] Mother’s counsel stressed the importance of lifestyle between the two parents’ homes.

[205] Adding to the difficulty in addressing income and the resulting support, both retroactive and ongoing, have been: the time this case took to get to trial; the failure of the husband to make the necessary and required guideline disclosure for a self-employed officer and shareholder of several companies, one located in the United States; his remarriage and then change of salespersons and having his new wife employed by his business; his failure to provide an independent expert income report; his change of residence; and his failure to call potential witnesses who might have addressed issues that might have assisted the experts with their assumptions and me in determining facts.

[206] I have concluded that based on the evidence as presented that there was and currently is income splitting between the father and his new wife. Adding back 33% of the father’s new wife’s income to him is reasonable and appropriate.

[207] The father was obliged to satisfy me as to his guideline income (both child and spousal support advisory) and to fill in the questions that remained.

[208] By reference to the father’s most recent financial statement of April 10 2012, the father discloses annual income of $187,200, which was likely, based on line 150 income tax returns (Ms. Prussky’s analysis began with $157,689) and for his wife C.Q., the father uses $127,000 (Ms. Prussky used $90,280 and added back 33%). These incomes are 2011 incomes. So it would appear that the most current information was that the father’s income for CRA purposes increased by nearly $30,000 and his wife’s by just over $35,000. If I merely added the father’s increase to Mr. Brooks’ calculation, his income would be approximately $276,000. If I were to add 33% of his wife’s income to his, this would add approximately $42,000 with a resulting income of approximately $318,000, but lacking the detail of the add back of expenses. According to note 1 of Mr. Brooks’ report, he discussed the fact that in his discussions with the company’s accountant (not called) an annual salary for C.Q. of $100,000 was not unreasonable. (For 2011 was now $127,000.)

[209] I find that I prefer Ms. Prussky’s handling of the expensing of the mother’s vehicle paid by the company. If he no longer expenses this, his income would be higher and the gross up of the $10,800 expense related to the vehicle should be added back as well (rounded to $20,000 with the gross up). I find that Mr. Brooks’ explanation for not adding this to the father’s income because the company operated at a loss and therefore the assumption that it would be available to the father is not supported by the evidence. The father decides what he expenses and what he does not and also decides what he draws for himself. He is in complete control.

Disposition of Child and Spousal Support

[210] In the circumstances, I find that the father’s income for guideline purposes is $338,000 (rounded). The mother’s income is not disputed at $39,000 per annum.

[211] In the event that this case ever returns to the court based on an allegation of change of circumstances due to the father’s income, the father bears the onus of proof. Following Ms. Prussky’s methodology and my findings, the father is to provide full and complete disclosure of all of his companies’ revenues, proof of and detail of all expenses paid personally and otherwise, and have his expense income analysis prepared by a duly qualified expert familiar with income calculations for support purposes. The income analysis should begin with 2011 income.

[212] I make no retroactive adjustments prior to January 1, 2012. I was not given sufficient evidence to satisfy myself as to the father’s income since separation. His lifestyle and ability to maintain the Mann property, live in several different locations, and suggest an expensive private school leaves me with the impression that his income likely exceeds my findings of $338,000 as his guideline income. Additionally, with income staying now within the family (the father and C.Q.) and the father’s willingness to continue to expense what others might see as vacation, recreation, entertainment and expensive vehicles, this remains a conservative finding.

[213] His willingness to readily attribute back 50% of expenses, except those he questioned, appears to be a recognition that he manages to fund much of his lifestyle and write off expenses that otherwise might be paid by after tax income.

[214] I inputted these findings into Divorcemate and ran some scenarios. The input for age of the parents, child and years of cohabitation were taken from the calculations provided by the mother’s Divorcemate calculations.

[215] Scenario 1 has the shared parenting (set-off calculation). This results in the father paying $2,306 per month child support (no section 7) and spousal support ranges from a low of $6,913, mid of $7,835 and high of $8,786. The maximum time period provides 11 years from separation (that would be August 2015 according to mother’s date of separation).

[216] Scenario 2 has K residing with primarily with her mother (no set off as father had originally agreed to).

[217] The child support amount increases to $2,654 and the spousal support amounts remain as in Scenario 1.

[218] The father submitted, as I described above, that I should find his income to be $246,676 which would result in $1,627 per month child support and a mid-range spousal of $5,286. He submits that since 2006 he has paid $6,000 per month combined child and spousal support and if child support should have been $1,627 than the allocation to spousal support of the total $6,000 would be $4,373 per month. Since he received no tax deductibility for this amount he suggests that using his marginal rate of 46% equates to $8,000 per month in “pre-tax Spousal Support.”

[219] I attempted to run what I will call the father’s assertions using his income figure and focused on what the father suggested would be an equivalent spousal support amount ($8,000). I focused on looking at the net benefit to the mother. I only calculated using a nil income for the mother. This was her situation at separation and I had no accurate figures otherwise from year to year. The result had ranges of spousal support low $5,984, mid $7,227 and high at $7,617 and child support of $1,978 in a shared scenario. If he paid the mid-level spousal support coupled with child support, the father’s total monthly payment would have been $9,195. The net after tax for the mother would be $7,617 but this of course does not deal with the private Montessori expenses he paid.

[220] K was only two years old at separation and while the mother started to seek employment and had part-time employment, she only commenced her full-time employment in 2008 and she has not earned $39,000 throughout the period of separation.

[221] It is likely that the father would have had to pay a higher total monthly support, partly deductable, but is also likely that the net after-tax benefit to the mother would have been higher than the $6,000 per month he paid.

[222] I am not in a position to accurately calculate a proper amount of retroactive support.

[223] Given the gross disparity in incomes, the age of K at separation and the age at which time the mother started full-time employment, I find the more appropriate approach is to extend the period of spousal support, rather than consider a retroactive calculation of and method of payment of any such amount.

[224] The Spousal Support Advisory Guidelines are just that, advisory guidelines, and while the must be considered in determining spousal support and are very helpful to give ranges, the Divorce Act remains the legislation that sets out the factors to be considered regarding entitlement, quantum and duration of support.

[225] When using Divorcemate, there is a reminder and a list of considerations and exceptions when using the guidelines. Determining spousal support is not merely entering data and ordering the result produced by the computer.

[226] As Professor Rogerson reminds us on the Department of Justice website:

SPOUSAL SUPPORT ADVISORY GUIDELINES: REPORT ON REVISIONS

1. The Guidelines are Still Advisory, and Not Legislated

The Advisory Guidelines have been revised and refined, but they remain voluntary, informal and advisory. They are not legislated. The Advisory Guidelines do not deal with entitlement, but only the amount and duration of spousal support.

4. The Creation of a Durational Range under the Basic With Child Support Formula

All orders under the with child support formula are indefinite in form, which now means "indefinite (duration not specified)". In cases involving dependent children, there are often review terms attached to such orders or agreements and, of course, they are subject to variation. In the Draft Proposal, we set out a maximum duration or "outside time limit", to maintain consistency with the without child support formula and to provide some structure for the process of review and variation. The maximum duration was the longer of either one year of support for each year of marriage or until the youngest or last child completed high school.

Absent any lower end of the range, however, the maximum duration was not treated as an outside time limit, but instead as a default time limit, as a period for which a recipient was entitled to receive spousal support. The problem was especially acute in shorter marriages with very young children. This outcome was never our intention and, throughout our feedback sessions, we canvassed lawyers, mediators and judges about how these shorter marriage cases worked out in practice. Lawyers in particular wanted to create a range for duration that would leave room for meaningful negotiation around duration. Over the past three years, we did develop a strong sense of what the lower end of the durational range for this formula could be.

As with the upper end of the durational range, there are two tests for the lower end of the durational range under the with child support formula. We have renamed these tests, to clarify their rationale and operation: the length-of-marriage test and the age-of-children test. Under these tests, the lower end of the range is the longer of either one-half year of support for each year of marriage or until the date after the youngest child starts attending school full-time.

The school date for the age-of-children test will vary from province to province and even from school district to school district, based upon the availability of junior kindergarten, the age rules governing school registration and the program the child takes.

In practice, the age-of-children test will determine the lower end of the durational range for shorter marriages and very young children, while the length-of-marriage test will typically apply to marriages of ten years or more or cases where children are already in school or close to starting full-time school.

It should be kept in mind that this change adds a lower end to the durational range for support and it says nothing about the proper amount of spousal support for this period, nor about continuing entitlement. It does not create a minimum entitlement. Further, the initial order will still be indefinite (duration not specified). Any time limit will only appear after a review or variation hearing, especially in cases involving young children. Finally, under the with child support formula, the rationale for support is compensatory and this should push most cases towards the longer end of the durational range, and away from the lower end of that range. [Emphasis added.]

[227] Given the age of the child at separation and the child-care responsibilities the mother had, she has acted reasonably and quite expeditiously securing full-time employment.

[228] In light of the possibility of a stark contrast in lifestyles between each parents’ home and the uncertainty of mother’s four-year career compared to the father’s business and his income and his household income, I find that the most appropriate way to address these issues is to order spousal support to continue to the later of August 2018 or K’s completion of high school. K just completed grade four and thus has eight more years before graduating from high school.

[229] Commencing January 2012, the father shall pay $2,316 per month child support (and he is to pay the current section 7 expenses) and pay spousal support of $8,000 per month (slightly above the mid-range). The spousal support continues to the later of August 2018 or K’s high school graduation. The father shall be given credit for payments actually made from January (to be agreed between the parties or if necessary I can fix based on exchange of affidavit evidence to show payments and calculations).

[230] In the event father does not move as I have outlined and the time share of week about ends, the child support increases to $2654 per month.

[231] The father has two life insurance policies, one for $2,000,000 with Cooperators and another for $1,000,000. K is the beneficiary of both policies and at the time the policies were taken out in 2003 and 1998, the father chose as trustees a friend and his father.

[232] So long as he is obliged to pay spousal and child support, the father is to name the mother as irrevocable beneficiary of the smaller policy and K as the irrevocable beneficiary of the larger policy. The mother shall be the designated trustee of the policy for K. As far as the smaller policy, the father may choose an institution of his choice. He shall make these changes forthwith and provide proof of said changes with the insurance companies involved.

[233] Support deduction order shall issue.

[234] Commencing June 1, 2013 and for as long as the child remains a dependant, the parties shall exchange income tax returns as filed. As the notices of assessment are received they are to be produced. The father shall also provide the annual financial statements of each corporation of which he is a shareholder, officer or director and the corporate tax returns as filed. This is a preliminary list and comprises part of his obligation to provide an expert income analysis of his income as provided for in this judgment. It follows the considerations set out in Ms. Prussky’s report in the event the issue of support is returned to the court

[235] Written submissions on costs may be exchanged. The mother’s submissions are due along with a bill of costs within 30 days and the father has 20 days after he receives the mother’s submissions.

Czutrin J.

Released: August 3, 2012