COURT FILE NO.: FD1640/03
DATE: August 28, 2012
ONTARIO
SUPERIOR COURT OF JUSTICE
FAMILY COURT
BETWEEN:
Maria-Luisa Plouffe
William R. Clayton for the applicant
Applicant
- and -
Damian Thomas Plouffe
Terry W. Hainsworth for the respondent
Respondent
HEARD: January 31, February 1, 21, 22 of 2012
MITROW J.
INTRODUCTION
[1] The issues in this trial are the amount and duration of spousal support to be paid by the respondent, Damian Thomas Plouffe ("Mr. Plouffe"), to the applicant, Maria-Luisa Plouffe ("Ms. Plouffe"), child support and distribution of capital paid by the parties into registered education savings plans (RESP) for their two oldest children.
[2] The parties were married to each other on June 4, 1988 and divorced pursuant to the divorce order of Morissette J. dated December 7, 2005 ("the divorce order"). The parties had separated on November 19, 2002. There are three children of the marriage, Lisa, born May 14, 1990; Jeffrey, born May 10, 1992; and Katie, born June 13, 1995, and at the time of trial the children were, respectively, 21, 19 and 16 years of age. Prior to marriage the parties had cohabited "for a year" according to Mr. Plouffe in cross-examination. Ms. Plouffe testified cohabitation started September 1987. Although little turns on this minor discrepancy, I find the parties began to cohabit September 1987.
[3] At time of trial, Ms. Plouffe was age 47 and Mr. Plouffe was age 51.
[4] The applicable legislation governing the support issues is the Divorce Act. At time of trial, neither Lisa nor Jeffrey was a "child of the marriage" within the meaning of the Divorce Act. The main child support issue is in relation to Katie, who resides with Ms. Plouffe (and always has). Mr. Plouffe agrees he should pay ongoing table support for Katie but the amount is in issue, as Mr. Plouffe derives his income from a corporation which he owns and controls and the parties do not agree on his income. The child support issues for Katie involve a retroactive component (as discussed in more detail below), both in relation to table amount and also in relation to significant s. 7 expenses claimed by Ms. Plouffe in regards to Katie's dance expenses.
[5] Mr. Plouffe currently pays spousal support to Ms. Plouffe in the amount of $4,000 per month. The main issue concerning spousal support is whether it should be indefinite or time limited.
THE SETTLEMENT, DIVORCE ORDER AND CURRENT PROCEEDING
[6] Pursuant to minutes of settlement dated September 26, 2005, the parties settled all of their matrimonial issues. Mr. Hainsworth was counsel for Mr. Plouffe at that time and Mr. Mamo was counsel for Ms. Plouffe. In his opening submissions, Mr. Hainsworth described the settlement as a "five year peace plan."
[7] The divorce order incorporated those portions of the minutes of settlement dealing with the actual settlement. The minutes of settlement stated that they constituted a separation agreement.
[8] In relation to custody, the divorce order provided that the parties have "interim joint custody" of Jeffrey, with Jeffrey to have his principal residence with Mr. Plouffe in British Columbia. However, Mr. Plouffe's residence in British Columbia was short-lived and he returned with Jeffrey to London in 2006. Ms. Plouffe was awarded sole custody of Lisa and Katie. The relevant provisions of the divorce order in relation to spousal support and child support can be summarized as follows (with the relevant paragraph number in the divorce order in brackets):
a) Mr. Plouffe is to pay Ms. Plouffe child support in the global amount of $2,200 a month for Lisa and Katie (this amount taking into account that Mr. Plouffe has Jeffrey in his care) (paragraph 3);
b) In paragraph 3, the divorce order contains specific provisions regarding termination of the child support arrangements:
- … This arrangement shall continue until the happening of the earliest of one of the following events:
(i) the review provided in paragraph 10 below;
(ii) One of the children finishes high school and enrolls in a post-secondary school institution; or
(iii) One of the children changes his or her principal residence and goes to live with the other parent.
c) Paragraph 5 provides as follows in relation to s. 7 expenses:
- Each parent shall pay for the special expenses as defined by section 7 of the Child Support Guidelines for the child or children residing with him or her without contribution from the other subject to variation pursuant to the provisions of paragraph 3 above.
d) Mr. Plouffe is to pay spousal support of $4,000 per month commencing October 1, 2005, subject to review after five years as set out in paragraph 8 as follows:
- … [the spousal support payments] to be subject to the following terms and conditions:
(i) The payments shall be tax deductible to the Respondent [Mr. Plouffe] and income to the Applicant [Ms. Plouffe] for income tax purposes;
(ii) The payments to be non-variable by either party prior to October 1st, 2010 for any reason and shall continue until there is a further agreement between the parties or a Court Order;
(iii) The issue of spousal support shall be reviewed effective October 1st, 2010 to determine further entitlement, amount and duration of spousal support.
e) Paragraphs 10 and 11 of the divorce order limited the parties' rights to vary both child support and spousal support, and limited the obligation of both parties to provide financial disclosure, as follows:
Except for circumstances contemplated in paragraphs 3(i)(ii)(iii) and 8(iii) above, neither party may apply to vary, modify or alter the provisions of the child and spousal support contained in this Divorce Order even in the event of a material, substantial or radical change of circumstances.
Neither party will be obligated to provide any form of financial disclosure to the other until the provisions of paragraphs 3(i)(ii)(iii) and 8(iii) are invoked at which time the parties will be obligated to exchange financial information and documentation as contemplated by section 21 of the Child Support Guidelines.
[9] The property settlement, in round numbers, resulted in Mr. Plouffe paying to Ms. Plouffe a little over $800,000 as part of the equalization payment, plus Ms. Plouffe received the jointly owned matrimonial home (in which she still resides). The matrimonial home had been valued by the parties at $420,000. The settlement provided that the matrimonial home was to be appraised and there was a requirement of an appropriate adjustment if the value of the matrimonial was different than $420,000. Finally, Mr. Plouffe agreed to pay $31,000 in child support arrears.
[10] Mr. Plouffe had supported Ms. Plouffe and the children throughout the marriage through his hard work and savvy entrepreneurial skills in the lumber industry. During the marriage, Mr. Plouffe incorporated National Forest Products Ltd. ("NFP"). Mr. Plouffe was, and continues to be, the sole shareholder of NFP, deriving all his income from this corporation. During the marriage, Ms. Plouffe was a stay at home parent, looking after the children. She did work outside the home as a teacher but this was only for brief periods early in the marriage. As at the date of separation, the date of settlement and at trial, Ms. Plouffe was not working outside the home.
[11] It is clear there were two controversial issues relevant to support at the time of settlement. The first was Mr. Plouffe's income and the second issue related to Ms. Plouffe continuing to be a stay at home parent and not working outside the home.
[12] The parties papered their disagreement on these issues at paragraphs 9 and 10 of the minutes of settlement (under the heading "Background") as follows:
The parties have disagreed with respect to the Respondent's income for child support and spousal support purposes.
The Respondent takes the position that the Applicant has the necessary education and the skills so as to obtain gainful employment.
[13] It is common ground between the parties that, at the time of settlement, Mr. Plouffe's position was that his annual income from NFP was $200,000. In relation to child support, neither the minutes of settlement nor the divorce order specified the parties' incomes or the relevant section of the Federal Child Support Guidelines ("Guidelines). However, I accept Ms. Plouffe's evidence that the $2,200 was arrived at by setting off the table amount of child support (with Mr. Plouffe paying for two children and Ms. Plouffe paying for one child) using an income of $200,000 for Mr. Plouffe and an imputed investment income (4% of $800,000) for Ms. Plouffe. The set-off resulted in $2,000 per month. An additional $200 was included for Katie's dance expenses, although this was not expressed to be a s. 7 expense. The settlement accomplished the following:
a) Both parties could carry on with their lives for five years without the ongoing stress and expense of litigation and, for Mr. Plouffe, this meant he could now devote more time to his business;
b) Other than the limited circumstances set out in the divorce order dealing with changes in child support, for the next five years Mr. Plouffe knew exactly what he had to pay for child support and spousal support and Ms. Plouffe knew exactly what she was entitled to receive. The amounts were agreed to be non-variable, coupled with the provision for financial non-disclosure during the five year period. (Even though portions of the settlement agreement, as it relates to child support, especially the lack of financial disclosure in relation to child support, may have been unenforceable, the parties were nevertheless content to include that in the agreement and abide by those terms.)
c) During the five year period, any potential disputes regarding s. 7 expenses were avoided, with each party agreeing to pay the s. 7 expenses for those children residing with him or her.
[14] Part way into the five year truce, Lisa moved in with Mr. Plouffe permanently. This occurred on May 1, 2008 and triggered Mr. Plouffe's request to change the child support arrangement as specifically permitted by paragraph 3(iii) of the divorce order (child changing his/her principal residence and going to live with the other parent). No voluntary resolution was reached as to a new child support arrangement.
[15] Mr. Plouffe then commenced a court proceeding (which is the proceeding now before the court) by way of a motion to change issued December 10, 2008. Mr. Plouffe's prayer for relief specifically sought an order to fix the parties' child support obligations pursuant to s. 8 of the Guidelines.
[16] Mr. Plouffe also filed an affidavit sworn December 4, 2008, explaining the reason for the change in child support. In response to the motion to change and affidavit, Ms. Plouffe filed an affidavit sworn January 12, 2009, in which Ms. Plouffe conceded the change in Lisa's custodial arrangements and acknowledged her obligation to pay child support for Lisa. However, in that affidavit, Ms. Plouffe opened up the issue of Mr. Plouffe's income for the purpose of determining child support and she also sought contribution for Katie's dance expenses pursuant to s. 7.
[17] Unfortunately, Mr. Plouffe's motion to change was not amenable to a speedy resolution, as it became bogged down with the issue as to what his true income was from NFP. Given that the five year review date would be triggered in October of 2010, and would involve similar issues which had arisen in the motion to change child support, both parties agreed to include within the motion to change a review of spousal support as provided in the divorce order. In addition, both parties also agreed that the court would be asked to deal with the issue being raised by Ms. Plouffe concerning the RESPs for Lisa and Jeffrey.
[18] The only proper pleading filed was the initial motion to change. Ms. Plouffe filed no formal pleadings on the motion to change. Neither party filed any pleadings (or even any affidavits) regarding the review or the RESP issues (although the parties did file at trial a helpful agreed statement of facts regarding the RESP issues). A review of the trial record would communicate to the reader limited information about the claims advanced by each party and issues to be tried.
[19] Ms. Plouffe raised in argument the issue as to whether the adjustment of table amount of child support for the children should go back to May 1, 2006, being the date of the first revised tables pursuant to the Guidelines. I decline to change child support for any period of time prior to May 1, 2008, given the terms of the minutes of settlement and the lack of any pleadings (or even an affidavit from Ms. Plouffe) asserting such a claim.
BACKGROUND AND CHILDREN
[20] There was no real dispute as to the material facts regarding the roles assumed by the parties during the marriage.
[21] Ms. Plouffe testified she was a student at University of Western Ontario, age 22 or 23, when she met Mr. Plouffe. Ms. Plouffe received a Bachelor of Musical Arts degree and then attended Althouse College in London for one year and received her Bachelor of Education degree. Ms. Plouffe taught music fulltime for two years with the Separate School Board until Lisa was born in May 1990. Ms. Plouffe took maternity leave after Lisa's birth until September 1990, at which time Ms. Plouffe returned to teaching but on a half-time basis. Ms. Plouffe continued to teach on a half-time basis until Jeffrey was born in May 1992 and thereafter Ms. Plouffe ceased teaching.
[22] I accept Ms. Plouffe's evidence that she left the teaching profession in May 1992 to be a fulltime stay-at-home caregiver for Lisa and Jeffrey (and then later for Katie) and that Mr. Plouffe supported this decision.
[23] In cross-examination, Mr. Plouffe corroborated Ms. Plouffe's evidence and he agreed that after Jeffrey was born, Ms. Plouffe left the workforce altogether "to devote herself to being a homemaker and a mother." He acknowledged that while he went to work every day, Ms. Plouffe stayed at home to look after the children and this continued throughout the marriage.
[24] At separation, all three children were residing with Ms. Plouffe but in approximately January 2004, a little over a year after separation, Jeffrey, at age 11, began living with Mr. Plouffe.
[25] As previously indicated, effective May 1, 2008 (less than three years after the settlement), Lisa moved to live with Mr. Plouffe (Lisa also turned age 18 that same month).
[26] Jeffrey earns $30,000 per year and has worked fulltime for his father's company, NFP, since leaving school effective September 2010. Although Jeffrey continues to reside with Mr. Plouffe, there is no dispute that effective September 2010 Jeffrey is no longer entitled to child support.
[27] Lisa lived with Mr. Plouffe for two years and there is no dispute that her eligibility for support ended effective May 2010. Lisa did obtain a business diploma from Fanshawe College in London. At the time of trial, Lisa was working part-time at Casino Rama and living with her boyfriend in the Orillia area. Her boyfriend is employed by NFP at its Orillia warehouse and Mr. Plouffe estimated he pays Lisa's boyfriend approximately $40,000 annually.
[28] Mr. Plouffe has remarried. He was married to Michelle Plouffe in July 2010. Michelle Plouffe had been working and quit her job "last summer" (meaning summer of 2011) according to Mr. Plouffe. After that, Michelle Plouffe did not work for awhile, but effective the beginning of 2012, she began to work at NFP and is being paid $36,000 per year. She also received some part-time income totaling $7,000 from NFP in 2011. It was Mr. Plouffe's evidence in cross-examination that Michelle Plouffe had earned the same income ($36,000 annually) from her previous employer. Mr. Plouffe testified in cross-examination that Michelle Plouffe's current pay from NFP "goes into the family pot" by being deposited directly into the joint account of Mr. Plouffe and Michelle Plouffe.
[29] Ms. Plouffe resides with her daughter Katie. Although Ms. Plouffe has been involved in an eight or nine year relationship with a man, she testified they do not cohabit, he maintains his own residence and they do not co-mingle their money. However, Ms. Plouffe has borrowed $27,000 from him to assist in her finances. This money has not been repaid. Ms. Plouffe testified they are not engaged and there are no marriage plans.
[30] It was Ms. Plouffe's evidence that, at the time of settlement, Katie was in her first year of competitive dance.
[31] Ms. Plouffe's evidence in-chief revealed a parent whose life is completely centered around her daughter, Katie. Every day during the school year, Ms. Plouffe drives Katie to and from high school (she was in grade 11 at time of trial). When school is finished, Ms. Plouffe takes Katie to the dance studio for Katie's daily three to five hour sessions. Ms. Plouffe also takes Katie to the chiropractor and massage therapist on a regular basis (necessitated by Katie's dance activities). When Katie is in school or at the studio, Ms. Plouffe does her household chores and runs her errands. She may also use this time to plan Katie's trips for competitions. On weekends, the routine includes Ms. Plouffe driving Katie to and from her dance lessons and running various errands.
[32] Ms. Plouffe agreed with her own lawyer that she was basically Katie's personal assistant. Ms. Plouffe testified that Katie is very talented and wants to pursue dance as a career. Ms. Plouffe described her devotion to Katie as an investment in the future. Katie's schedule is given priority in Ms. Plouffe's household. Katie's travel schedule has included competitions in Collingwood, Buffalo, Niagara Falls, Detroit, Florida and also Katie has been to California. Ms. Plouffe routinely accompanies Katie on all these trips.
[33] Ms. Plouffe also defended her decision in being at home on the basis that Katie's older siblings benefited from her being at home (although it is noted Jeffrey was only 11 when he went to live with Mr. Plouffe) and that Katie was entitled to the same.
[34] According to Ms. Plouffe, Katie's current plan includes finishing high school in the spring of 2013 and then possibly attending a further year of high school to get some additional credits, thereby actually finishing high school in the spring of 2014. Katie wishes to pursue a dance program at the post-secondary level after finishing high school. Ms. Plouffe testified Katie's marks are a "B" average, that Katie could work a little bit more on her academics and that Katie's focus has always been on her dance. Ms. Plouffe sees herself fulfilling her current role until Katie has finished high school.
[35] In cross-examination, Ms. Plouffe without hesitation agreed that, since separation, she has not applied anywhere to teach, has taken no university or college courses, has not taken any upgrading, has not taken any vocational training or re-training and has not registered with any employment agencies. Ms. Plouffe did emphasize that she had volunteered at Katie's school (as she had with the other children).
MR. PLOUFFE'S INCOME
A. Mr. Plouffe's Historical Income
[36] Other than some modest investment income, Mr. Plouffe's income as disclosed in his tax returns is comprised exclusively from his employment income from NFP. It is also apparent that the timing of the settlement in 2005 could not have been more fortuitous for Mr. Plouffe as for the next several years NFP enjoyed a dramatic spike in sales and profitability.
[37] For the years 1999 to 2010 inclusive, Mr. Plouffe's income (rounded) from NFP and his total line 150 income (the additional income each year consisting mainly of interest, investment income, dividend and/or taxable capital gains) as disclosed in his tax returns filed at trial is as follows:
Year
T4 Income from NFP
Total Line 150
1999
$85,000
$88,894
2000
$90,000
$98,638
2001
$90,000
$100,072
2002
$90,000
$96,152
2003
$390,000
$398,626
2004
$219,993
$224,979
2005
$203,406
$210,660
2006
$1,969,433
$1,974,076
2007
$200,080
$205,812
2008
$200,044
$208,013
2009
$200,000
$203,994
2010
$200,000
$201,532
[38] The gross revenues and pre-tax incomes for NFP for the years 2004 to 2011 (the fiscal year end being November 30) as disclosed in the financial statements filed at trial are as follows (it being noted that all of the financial statements were audited except for the year 2004):
Year
Gross Revenue
Pre-tax Income
2004
$37,969,775
$213,650
2005
$49,670,991
$189,986
2006
$47,676.443
$1,783,135
2007
$50,393,079
$1,573,333
2008
$35,118,230
$778,955
2009
$22,000,731
$475,026
2010
$27,729,076
$427,799
2011
$26,109,608
$98,963
[39] NFP's financial statements for other years were not produced at trial.
[40] NFP was started by Mr. Plouffe in or about 1993. Mr. Plouffe described in some detail the workings and evolution of NFP. Over the years the nature of the business changed from NFP being a broker of white wood to dealing substantially in high quality cedar products that are delivered to the customer. While operating as a broker, NFP seldom "touched" the wood, meaning that the wood was shipped from the source direct to the customer. I accept Mr. Plouffe's knowledgeable evidence on the workings of the lumber industry and that the industry has changed such that now, for most of its product, NFP takes delivery of the product, stores the product at its facilities and then ships the necessary quantities of product, when required, to its customers. Competition in the industry requires NFP to give its customers very favourable payment terms. The result is that NFP has the added cost of stockpiling and financing the inventory. When asked in-chief where NFP's products would range "on a scale from a Toyota Camry to a Mercedes Benz," Mr. Plouffe proclaimed with little hesitation, "we're known as the Mercedes Benz in the industry."
[41] In supporting his position that his income is $200,000, Mr. Plouffe testified in-chief that during approximately 2003 to 2004 he changed NFP's bankers from Scotiabank to CIBC and that while with CIBC, he was subject to a $200,000 salary cap that was part of the financing package. The salary cap could not be exceeded absent CIBC's permission. NFP currently banks with Bank of Montreal and Mr. Plouffe testified that he is subject to the same $200,000 salary cap.
[42] By August 2005, just before the settlement in September 2005, Mr. Plouffe had already departed to Vancouver. He testified in-chief he moved to Vancouver to be near the lumber business and to make new contacts. However, NFP's office and staff remained in London. Mr. Plouffe added in his evidence that he moved to Vancouver because he was involved with a woman.
[43] Mr. Plouffe, of course, needed to buy a new house in Vancouver and he attended promptly to making such a purchase, describing the Vancouver real estate market at that time as "red hot."
[44] As verified by the reporting letter from Mr. Plouffe's Vancouver solicitor, the house purchased by Mr. Plouffe was for a price of $1.85 million and the purchase closed September 30, 2005. CIBC provided a mortgage for approximately $1.22 million. When asked in-chief "how did you get the rest of the money to close the deal," Mr. Plouffe said "I borrowed it from the company," and when asked if he told the bank, Mr. Plouffe said "no."
[45] In relation to the purchase of this Vancouver property, Mr. Plouffe had to pay a deposit of $494,875 and a further amount of $299,777, the latter amount being the amount due on closing. The total amount paid by Mr. Plouffe (over and above the mortgage funds) totaled $794,652 and this included $129,500 for GST and $35,000 property transfer tax (as confirmed in the statement of adjustments).
[46] Mr. Plouffe agreed that he accessed the necessary money to pay for his house purchase simply by writing a cheque on NFP's account. His initial characterization that this money was "borrowed" is quite misleading. The money that Mr. Plouffe took out of NFP for the house purchase was treated as income and was included in the $1.97 million he reported as income from NFP in 2006.
[47] I found Mr. Plouffe's evidence in-chief regarding the $1.9 million (approximate) income he earned in 2006 most confusing. Mr. Plouffe testified this income consisted of the $200,000 annual salary he paid himself and "a one-time bonus, that I paid the company back." He then testified that if he had paid everything back in 2006, he would not have been able to meet his covenants with the bank and then added, "So, what I did, is I postponed my bonus into 2007. That's what I did."
[48] In cross-examination, Mr. Plouffe initially continued to insist the money he took from NFP to close the Vancouver purchase was a loan and that he paid it all back. Mr. Plouffe at this point seemed rather confused. Later, in cross-examination, Mr. Plouffe eventually conceded that the $1.9 million (approximate) 2006 income was comprised of the money he took in 2005 to buy the Vancouver property, plus some money he took out to pay Ms. Plouffe and plus the tax he had to pay to Canada Revenue Agency.
[49] In contradiction to his earlier testimony, Mr. Plouffe then conceded in cross-examination that in 2007 his total income was $205,000 (rounded) and that there were clearly no "bonuses" in 2007 that he had earlier alluded to.
[50] Mr. Plouffe's evidence, that he did not seek CIBC's advance permission when taking out the almost $800,000 to buy the Vancouver property, takes on some significance because it belies his earlier evidence of the $200,000 salary cap. However, later, in a question from the court, Mr. Plouffe suggested that he did get bank approval at the time this money was paid out.
[51] It was pointed out to Mr. Plouffe in cross-examination that CIBC's annual credit facility agreements (filed as exhibits for the years 2006 to 2009 inclusive) did not contain a covenant restricting his income to $200,000. The relevant covenant for the year 2009 (see. Ex. 5) states as follows (and the same covenant is contained in the agreements for the other three years):
Restricted Payments:
The Borrower and its Subsidiaries will not pay any dividends, make any capital payments or redemptions, pay any amount on account of Postponed Debt or make any gifts or gratuities to affiliated persons in an aggregate amount exceeding the lesser of net income or $200,000 during any fiscal year.
[52] Mr. Plouffe's response, in cross-examination, that the actual wording of the covenant did not include a salary cap, was to dismiss the wording. He testified he did not care what it says and insisted there was a $200,000 salary cap.
[53] Mr. Plouffe's evidence, on the whole, regarding an existing salary cap was unconvincing. I did not believe Mr. Plouffe when, after his earlier evidence in-chief, he later suggested he obtained CIBC's approval before taking out the almost $800,000 to close the Vancouver purchase. I accept his earlier clear evidence in-chief that he did not obtain prior approval. The written loan agreements do not corroborate his evidence. Finally, Mr. Plouffe did not produce the current loan agreement with the Bank of Montreal, nor did he call any evidence from Bank of Montreal or CIBC to corroborate his evidence.
[54] As will soon become apparent in these reasons, Mr. Plouffe displays a clear proclivity towards conduct designed to mask his real income, thus rendering him a most unreliable witness on that topic.
[55] In cross-examination, after confirming that he signed the agreement of purchase and sale for the Vancouver property in August 2005, Mr. Plouffe then agreed that in early September 2005 there was a four-way meeting between counsel and the parties which resulted in to the settlement. Mr. Plouffe clearly had a dilemma. Should he disclose to Ms. Plouffe before the settlement that he had just bought a $1.85 million house in Vancouver? What did Mr. Plouffe do? The answer is he deliberately withheld this information from Ms. Plouffe.
[56] When asked in cross-examination whether he knew about his duty to disclose, Mr. Plouffe gave the following rather incredible response: "Nope, I was not familiar about any duty to disclose, because I was goin' into debt." I did not believe Mr. Plouffe's disavowal of a duty to disclose, nor do I think Mr. Plouffe actually believed what he said.
[57] When pressed in cross-examination that his failure to disclose was based on his belief it might have an adverse effect on his position regarding settlement, Mr. Plouffe admitted, "Yes, I don't deny that." The only praiseworthy aspect of this answer is the level of candour in his admission that he withheld important financial information from Ms. Plouffe on the eve of settlement. Mr. Plouffe was clearly aware that he could have had a difficult time convincing Ms. Plouffe that his income was $200,000 while he was in the midst of plucking almost $800,000 (and later the associated tax) from NFP to buy the Vancouver property.
[58] Mr. Plouffe's dubious financial disclosure practices were also apparent in relation to his daughter "Dana" (this may not be the correct spelling) by a previous relationship. During the course of his cross-examination, Mr. Plouffe was asked by the court to give Dana's date of birth. Mr. Plouffe displayed initial confusion as to her year of birth. He finally narrowed it down by testifying Dana was born in June (Mr. Plouffe not being sure at to which day in June) and he added Dana "could be 24 now" and later amended that, saying "I believe" she is 25 now. Mr. Plouffe, when asked in cross-examination whether he stopped paying child support for Dana in 2003, conceded "That sounds about right."
[59] During cross-examination, Mr. Plouffe's evidence in relation to his income and paying child support for Dana included the following:
a) In 2001, Ms. Plouffe reported income from NFP in the amount of $425,087.36 and Mr. Plouffe reported $90,000 from NFP;
b) Mr. Plouffe admitted Ms. Plouffe did not "earn" the income attributed to her, that he earned that money, and he agreed he allocated that income to Ms. Plouffe so Dana's mother would not find out about it;
c) In the year 2000, Mr. Plouffe agreed there was also an income split, with Ms. Plouffe being allocated income of $449,082.35 from NFP and Mr. Plouffe being allocated $90,000;
d) Mr. Plouffe agreed he was paying support for Dana based on his $90,000 income and when it was suggested to Mr. Plouffe that back then, to some extent, his income was what he wanted it to be, he testified, "Yes. That's correct."
[60] I find on Mr. Plouffe's clear evidence and admissions that he purposely manipulated his income from NFP in a manner designed to reduce his child support payments for Dana below what he should have paid. Mr. Plouffe's denial during cross-examination that that was his intention is not worthy of belief. With all due respect to Mr. Plouffe, I am inclined not to "sugar-coat" what he did: his conduct resulted in Dana's mother, and Dana, being cheated out of the proper amount of child support he should have paid and, most likely, to a not insignificant degree.
[61] Mr. Plouffe's evidence that these large income payments in 2000 and 2001 were designed to take advantage of lower tax rates for NFP, and that a portion of this income was paid back to NFP, by him, as a shareholder loan to NFP (which then formed part of his assets subject to equalization) does not in any way ameliorate his conduct.
[62] Although Ms. Plouffe was somewhat complicit in this scheme, I am satisfied on the evidence that Mr. Plouffe was clearly in control and that Ms. Plouffe merely did what she was told to do by Mr. Plouffe regarding income splitting.
[63] It was common ground between the parties that prior to settlement in September 2005, Mr. Plouffe had made an advance payment of $510,000 to Ms. Plouffe. During cross-examination, Mr. Plouffe agreed that after separation he had placed that amount of money in an account in the Grand Cayman Islands and that this was "uncovered" during his oral questioning by Mr. Mamo in the first proceeding. Mr. Plouffe further agreed during cross-examination that "probably" the main reason he transferred the money to the Grand Cayman Islands was because it was a convenient place to park money where it may not be found. When this account was discovered, Mr. Plouffe consented to an order that he transfer the money back and then either directly, or indirectly, this money became the source of the advance payment to Ms. Plouffe.
B. Findings in Relation to Mr. Plouffe's Income
[64] I find that any testimony from Mr. Plouffe, unless corroborated, in relation to the money available to him from NFP for child support purposes, must be treated with suspicion and accorded low weight. Mr. Plouffe will yield to temptation to hide assets as he did (in the Grand Caymans), misrepresent his income to pay less child support (as he did for his daughter, Dana) and ignore his obligation for full financial disclosure if it suits his purposes (as he did on the eve of settlement in 2005).
[65] Mr. Plouffe agreed that NFP had some excellent years of profitability soon after 2005. He testified that the accumulated profits had to be retained in NFP. These profits, for example, were used to buy the Orillia warehouse for approximately $1 million (in 2009) on a mortgage free basis, plus funding a further $300,000 expenditure for renovations and other expenses, plus paying an expense for paving of $130,000. Mr. Plouffe testified that in fiscal 2010 he incorporated Thuja Transport Ltd. ("Thuja") for the sole purpose of buying a transport truck to haul lumber primarily for NFP. The business reason for doing this was to reduce freight costs and increase profitability. Thuja has borrowed money from NFP ($328,345 owing at the end of fiscal 2011).
[66] The above expenditures were under $2 million (and this assumes that the renovations and paving expenses were included in the capital cost of the warehouse). During the five years 2006 to 2010 inclusive (which are basically the five years covered by the "peace plan"), the audited financial statements show that NFP had combined pre-tax income of approximately $5 million and for that same time period the after-tax combined income was approximately $3.5 million.
[67] I find the facts of this case engage s. 17 and 18 of the Guidelines which provide as follows:
17(1) If the court is of the opinion that the determination of a spouse's annual income under section 16 would not be the fairest determination of that income, the court may have regard to the spouse's income over the last three years and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years.
(2) Where a spouse has incurred a non-recurring capital or business investment loss, the court may, if it is of the opinion that the determination of the spouse's annual income under section 16 would not provide the fairest determination of the annual income, choose not to apply sections 6 and 7 of Schedule III, and adjust the amount of the loss, including related expenses and carrying charges and interest expenses, to arrive at such amount as the court considers appropriate.
18(1) Where a spouse is a shareholder, director or officer of a corporation and the court is of the opinion that the amount of the spouse's annual income as determined under section 16 does not fairly reflect all the money available to the spouse for the payment of child support, the court may consider the situations described in section 17 and determine the spouse's annual income to include
(a) all or part of the pre-tax income of the corporation, and of any corporation that is related to that corporation, for the most recent taxation year; or
(b) an amount commensurate with the services that the spouse provides to the corporation, provided that the amount does not exceed the corporation's pre-tax income.
(2) In determining the pre-tax income of a corporation for the purposes of subsection (1), all amounts paid by the corporation as salaries, wages or management fees, or other payments or benefits, to or on behalf of persons with whom the corporation does not deal at arm's length must be added to the pre-tax income, unless the spouse establishes that the payments were reasonable in the circumstances.
[68] The Court of Appeal for Ontario has stated clearly that the purpose of s. 18 of the Guidelines "is to enable the courts to conduct a fair accounting of the money available for the payment of child support.[^1]"
[69] I also adopt the analysis of Harvison Young J. in O'Neill v. O'Neill[^2] and the authorities cited therein that s. 18(1)(a) of the Guidelines does not prevent the court, in appropriate circumstances, from considering a corporation's pre-tax income for years other than just the most recent year.
[70] While Mr. Plouffe was knowledgeable about the workings of the lumber industry and his business operations, I found Mr. Plouffe's evidence unreliable when it came to testimony about financial details. This included his mischaracterization of part of his $1.9 million income as a loan that he repaid. No expert witnesses testified at trial. In fact, there were only two witnesses at trial, Mr. Plouffe and Ms. Plouffe.
[71] Mr. Plouffe hardly inspired the court's confidence in his presentation of financial matters when during his cross-examination he testified, apologetically, that there is "something radically wrong" with his financial statement sworn January 29, 2012 prepared for the trial. He said some "numbers are not correct; there's stuff that's missing, there's stuff in there that shouldn't be in there." Mr. Plouffe testified he had been away and was in a rush. Even if that evidence is true, it amounts to an unacceptable, lame excuse. Most of the errors were related to the expenses shown in his financial statement.
[72] It was rather clear that during fiscal 2011 NFP had purchased a Mercedes Benz motor vehicle for Mr. Plouffe to drive (via a 60 month term loan for just over $62,000, as reflected in the financial statement). During cross-examination, Mr. Plouffe continued to insist that this loan was for a forklift. He was so patently wrong that Mr. Hainsworth felt obliged to rise during the cross-examination and concede that his client was "probably mistaken" and that this was indeed the car loan.
[73] The thrust of Mr. Plouffe's submission that his income from NFP is limited and that no pre-tax corporate income should be attributed to him is most unconvincing and not supported by the evidence. I agree with the submission made by Ms. Plouffe – the paymaster for Mr. Plouffe is Mr. Plouffe. Mr. Plouffe's salary cap evidence is patently self-serving, unreliable and uncorroborated as was his testimony suggesting an inability to access more pre-tax corporate income for child support purposes.
[74] Although Jeffrey lives with Mr. Plouffe and works fulltime, it was Mr. Plouffe's testimony that the expenses in his financial statement include expenses for Jeffrey. There was no indication that Jeffrey pays any room and board. Mr. Plouffe agreed in cross-examination that he had purchased cars for both Lisa and Jeffrey (about $22,000 for each car) and that he still pays Lisa's car insurance. The older Mercedes Benz owned by Mr. Plouffe personally is now driven primarily by his wife.
C. Determination of Mr. Plouffe's Income for 2008, 2009 and 2010
[75] It is necessary to determine Mr. Plouffe's income back to 2008 to determine the variation of child support requested by his motion to change. For each of these three calendar years, Mr. Plouffe's T4 income from NFP was basically $200,000 and his total line 150 income was marginally higher. NFP's pre-tax corporate profits for 2009 and 2010 were relatively similar, averaging approximately $450,000 for each year. For 2008, the corporate pre-tax profit was just under $779,000. There was no convincing evidence from Mr. Plouffe why he could not have taken a further $100,000 average for each of those years out of pre-tax profits as part of his income. This was the finding Ms. Plouffe submitted the court should make. I am satisfied on the evidence that for the years 2008 to 2010 inclusive, Mr. Plouffe's income should be assessed at $300,000. For the year 2008, I find that Mr. Plouffe's income should be $208,013 (as shown in his 2008 tax return at line 150), plus a further $91,987 from NFP's fiscal 2008 pre-tax profit, for a total of $300,000. Similarly, for each of the years 2009 and 2010, I find that Mr. Plouffe's income for child support purposes is $300,000 consisting, for each of those years, of his line 150 income with the difference being taken from the pre-tax profit for the relevant fiscal year for NFP.
D. Mr. Plouffe's Income for 2011
[76] For fiscal 2011, NFP's pre-tax income dropped significantly to $98,963. In large measure, this drop was attributable to a significant increase in salaries and benefits totaling over $370,000 (see Ex. 7) in fiscal 2011 as compared to fiscal 2010. I accept Mr. Plouffe's evidence that he hired a number of new employees as a strategic investment to boost sales. Mr. Plouffe also points to a net loss of $53,560 in Thuja for fiscal 2011 (Thuja has the same November 30th year end) and submits I should consider that loss as offsetting some of the pre-tax income in NFP.
[77] Notwithstanding Mr. Plouffe's evidence that he could not take any more pre-tax income out of NFP, it is noteworthy that in fiscal 2011 NFP still managed to find the resources to finance a new Mercedes Benz motor vehicle for Mr. Plouffe. At time of trial, Mr. Plouffe's 2011 income tax return was not yet available but Mr. Plouffe testified he continued to take $200,000 as an income. I find that for fiscal 2011, Mr. Plouffe's income should include the $200,000 he took as a salary. Pursuant to subsection 18(2) of the Guidelines, Mr. Plouffe has not satisfied me that the $7,000 he paid to his wife from NFP as part-time income was reasonable and I add it back to NFP's pre-tax income. No evidence was given by Mr. Plouffe why his wife left her previous job. The circumstances are compelling that Mr. Plouffe simply created a job for his wife within NFP, thus increasing the money he can access out of NFP into their joint personal account. In addition to the $7,000, I also add an amount of $18,000 from pre-tax income from NFP and, accordingly, I assess Mr. Plouffe's income for 2011 at $225,000.
E. Mr. Plouffe's Income for 2012
[78] Clearly Mr. Plouffe has expectations of a return on investment from his significant cost in hiring extra staff. Fiscal 2011 provided an unusually low pre-tax profit for NFP. Mr. Plouffe's income of $225,000 for 2011 should not define on its own what his income will be likely for 2012. Clearly Mr. Plouffe's income fluctuates with NFP's income. I apply s. 17 of the Guidelines and I find that an average of his last three years' income ($300,000 for 2009 and 2010 and $225,000 for 2011) represents the fairest determination of his 2012 income which I assess to be $275,000. This takes into account that his wife's fulltime income of $36,000 should be added back to pre-tax income for the same reasons as explained in relation to her part-time $7,000 income in 2011. Also, the incorporation of Thuja seems to be paying off, as in fiscal 2011 there was a decrease of approximately $575,000 in "freight, customs and duty" expenses compared to fiscal 2010.
[79] Finally, on the facts of this case, the aforesaid incomes which have been determined for child support purposes, I also find are appropriate to use for spousal support.
CHILD SUPPORT – TABLE AMOUNTS
[80] The proper approach is for each party to pay child support to the other for the children in the other party's care. This obligation is to be calculated back to May 1, 2008 and should take into account the termination dates for both Katie and Jeffrey as previously discussed. Mr. Plouffe is entitled to a credit for all payments actually made starting May 1, 2008. There was no real dispute between the parties that the table amount of child support needs to be re-apportioned back to May 1, 2008 as requested in Mr. Plouffe's pleadings. (Further, applying the factors in S.(D.B.), infra, it is appropriate to make this order.)
[81] In relation to Ms. Plouffe's income and the amount of child support payable by her, I have relied on the SSAG calculations prepared by Ms. Plouffe which include the scenario of income of $300,000 for Mr. Plouffe for the years 2008 through to 2010 inclusive. These calculations also correctly show Ms. Plouffe's actual income from all sources and the calculations further make the necessary Schedule III Guideline adjustments including Ms. Plouffe's capital gain and dividend income. I am not prepared to impute any income to Ms. Plouffe during the five year period after the settlement agreement as, in my view, her actual income earned is appropriate. The rationale for Ms. Plouffe's obligations in terms of earning an income during the currency of the five year standstill agreement are discussed later in these reasons in relation to spousal support.
[82] Accordingly, an order shall issue that paragraph 3 of the divorce order of Morissette J. dated December 7, 2005 is vacated effective April 30, 2008 and the parties shall pay child support as follows:
a) For the period May 1, 2008 to December 1, 2008 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,364 per month and Ms. Plouffe shall pay child support to Mr. Plouffe for Lisa and Jeffrey in the amount of $450 per month, thereby resulting in a net payment by Mr. Plouffe to Ms. Plouffe in the amount of $1,914 per month, said child support being paid pursuant to s. 8 of the Guidelines and based on Mr. Plouffe's income of $300,000 and Ms. Plouffe's income of $30,487;
b) For the period January 1, 2009 to December 31, 2009 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,364 per month and Ms. Plouffe shall pay child support to Mr. Plouffe for Lisa and Jeffrey in the amount of $165 per month, thereby resulting in a net payment by Mr. Plouffe to Ms. Plouffe in the amount of $2,199 per month, said child support being paid pursuant to s. 8 of the Guidelines and based on Mr. Plouffe's income of $300,000 and Ms. Plouffe's income of $12,484;
c) For the period January 1, 2010 to April 1, 2010 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,364 per month and Ms. Plouffe shall pay no child support to Mr. Plouffe for Lisa and Jeffrey, said child support being paid pursuant to s. 8 of the Guidelines and based on Mr. Plouffe's income of $300,000 and Ms. Plouffe's income of $4,507;
d) For the period May 1, 2010 to August 1, 2010 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,364 per month and Ms. Plouffe shall pay no child support to Mr. Plouffe for Jeffrey, said child support being paid pursuant to s. 8 of the Guidelines and based on Mr. Plouffe's income of $300,000 and Ms. Plouffe's income of $4,507;
e) For the period September 1, 2010 to December 1, 2010 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,364 per month, said child support being paid pursuant to s. 3(1)(a) of the Guidelines and based on Mr. Plouffe's income of $300,000;
f) For the period January 1, 2011 to December 1, 2011 inclusive, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $1,809 per month, said child support being paid pursuant to s. 3(1)(a) of the Guidelines and based on Mr. Plouffe's income of $225,000;
g) For the period commencing January 1, 2012 and continuing monthly thereafter on the first day of each month, Mr. Plouffe shall pay child support to Ms. Plouffe for Katie in the amount of $2,188 per month, said child support being paid pursuant to s. 3(1)(a) of the Guidelines and based on Mr. Plouffe's income of $275,000;
h) Mr. Plouffe shall be entitled to the following credits in relation to the aforesaid child support order:
i) for the three months commencing May 1, 2008 up to and including July 1, 2008, the sum of $2,200 per month representing the payments he has actually made;
ii) for the period commencing August 1, 2008 up to and including February 1, 2012, the sum of $1,100 per month representing the payments he has actually made;
iii) for the period commencing March 1, 2012, Mr. Plouffe shall also be credited with any child support payments he has made up to and including the date of this order.
i) The arrears which have accrued for the period May 1, 2008 up to and including the date of this order shall be paid by Mr. Plouffe in a lump sum to Ms. Plouffe on or before September 15, 2012 but without any pre-judgment interest;
[83] I will leave it to counsel to calculate the exact arrears after implementing the child support order. Should there be any dispute regarding same, then I may be spoken to. In order to avoid any ambiguity, counsel on consent may insert into the court order the actual amount of the child support arrears.
SPOUSAL SUPPORT
A. The Position of the Parties
[84] Both parties agree, and I concur, that spousal support in this case is to be determined pursuant to s. 15.2 of the Divorce Act. The scope of review is widely framed in the divorce order, with no conditions other than naming a review date of October 1, 2010.
[85] Entitlement is not in issue and, subject to one caveat, neither is quantum. Both parties submit that quantum should continue at $4,000 per month. The issue is one of duration, with Mr. Plouffe submitting that support should cease in two years (in closing submissions he referred to June 2014). Ms. Plouffe submits that spousal support should be indefinite and without any further review date.
[86] During opening submissions, Mr. Plouffe articulated his position that a teacher's income in the range of $60,000 to $80,000 annually could be imputed to Ms. Plouffe. However, the submission was also made that Mr. Plouffe is not relying on the Spousal Support Advisory Guidelines ("SSAGs") and that he is prepared to pay $4,000 monthly on the time limited basis previously referred to. The practical effect of Mr. Plouffe's position is that it does not matter what, if any, income is imputed to Ms. Plouffe. He is prepared to pay the $4,000 time limited. In closing argument, there were in fact two SSAG calculations submitted by Mr. Plouffe (both dated February 21, 2012) to show SSAG ranges with Mr. Plouffe earning $200,000 and Ms. Plouffe earning either $4,000 or $32,000 annually. Using lower income for Ms. Plouffe, the SSAGs ranged from a low of $4,602 to a high of $5,637 per month and, using the higher income, the SSAGs ranged from a low of $3,347 to a high of $4,543 per month. Viewed in the context of those SSAG calculations, Mr. Plouffe submitted that the quantum he proposed was reasonable and he noted that the duration that he proposed would be towards the upper end of the SSAG range. (Those SSAG calculations included no provision for s. 7 expenses.)
[87] Ms. Plouffe is content with the monthly quantum of $4,000, so long as the duration is indefinite. It was further Ms. Plouffe's position that if Mr. Plouffe's income is found to be $300,000 that Ms. Plouffe remains content for spousal support to remain at $4,000 per month. Ms. Plouffe submitted a total of 14 SSAG calculations (all dated February 17, 2012) that were included as an appendix to her written argument brief. The SSAG calculations were primarily for scenarios dealing with retrospective child support.
[88] Ms. Plouffe does not assert any attack on the 2005 settlement agreement that led to the consent divorce order.
B. Discussion
[89] In relation to spousal support, the starting point is the factors and objectives set out in sections 15.2(4) and 15.2(6) of the Divorce Act.
[90] As made clear by the Supreme Court of Canada in Moge v. Moge[^3], all the objectives must be considered and no single objective is paramount. The following was stated (at para. 53):
53 All four of the objectives defined in the Act must be taken into account when spousal support is claimed or an order for spousal support is sought to be varied. No single objective is paramount. The fact that one of the objectives, such as economic self-sufficiency, has been attained does not necessarily dispose of the matter. Carruthers C.J.P.E.I observed in Mullin v. Mullin (1991), supra, at p. 148:
All of these objectives must be considered. There is nothing in the legislation to suggest that any one or two of these objectives should be given greater weight or importance than any other objective. Section 17(7) of the Act recognizes that each former spouse shall attain economic self-sufficiency, insofar as practicable, within a reasonable period of time, but it does not say that such economic self-sufficiency is the dominant consideration.
[91] Self-sufficiency, often at the heart of many spousal support disputes, is a significant issue in the present case. However, self-sufficiency is not a duty, but rather one factor to consider. In Leskun v. Leskun[^4], the Supreme Court of Canada summarized the law in relation to self-sufficiency as follows (at para. 27):
27 Failure to achieve self-sufficiency is not breach of "a duty" and is simply one factor amongst others to be taken into account. As stated in Moge and repeated in Bracklow:
At the end of the day ..., courts have an overriding discretion and the exercise of such discretion will depend on the particular facts of each case, having regard to the factors and objectives designated in the Act.
(Moge, at p. 866; Bracklow, at para. 53)
[92] The principle that devotion to child rearing can jeopardize a parent's financial security on marriage breakdown was described as follows in Moge (at para. 81):
81 The most significant economic consequence of marriage or marriage breakdown, however, usually arises from the birth of children. This generally requires that the wife cut back on her paid labour force participation in order to care for the children, an arrangement which jeopardizes her ability to ensure her own income security and independent economic well-being. In such situations, spousal support may be a way to compensate such economic disadvantage.
[93] A spouse's standard of living during the marriage is also a relevant consideration and this was addressed in Moge (at para. 85):
85 Although the doctrine of spousal support which focuses on equitable sharing does not guarantee to either party the standard of living enjoyed during the marriage, this standard is far from irrelevant to support entitlement (see Mullin v. Mullin (1991), supra, and Linton v. Linton, (supra). Furthermore, great disparities in the standard of living that would be experienced by spouses in the absence of support are often a revealing indication of the economic disadvantages inherent in the role assumed by one party. As marriage should be regarded as a joint endeavour, the longer the relationship endures, the closer the economic union, the greater will be the presumptive claim to equal standards of living upon its dissolution (see Rogerson, "Judicial Interpretation of the Spousal and Child Support Provisions of the Divorce Act, 1985 (Part I)", supra, at pp. 174-75).
Section 15.2(4) – factors
[94] Regarding the first two factors (sections 15.2(4)(a) and (b)), the length of cohabitation in the present case is 15 years and 2 months (from September 1987 to November 2002). Clearly this is not a short marriage. After the first four years of marriage, Ms. Plouffe gave up her teaching career to take on the responsibility of being a fulltime stay-at-home parent and caregiver to the children. During the last two years of teaching, Ms. Plouffe was working on a half-time basis. Also important is that this role assumed by Ms. Plouffe during the marriage was clearly a joint decision and supported by Mr. Plouffe. Mr. Plouffe was to be the wage earner during the marriage. The childcare and household management responsibilities assumed by Ms. Plouffe enabled Mr. Plouffe to achieve financial success through his hard work at NFP.
[95] Regarding section 15.2(4)(c), the effect of the settlement agreement and subsequent order dealing with spousal support needs to be considered. Clearly, Mr. Plouffe derived substantial financial benefit from the five year agreement. During that time, especially in the early years, NFP's sales and profits soared, as did its retained earnings. The value of NFP increased significantly. In terms of spousal support paid to Ms. Plouffe during this period of the agreement, she was arguably under compensated, especially when examining Mr. Plouffe's 2006 $1.9 million income and considering that a substantial portion of that increased income resulted from Mr. Plouffe's desire to access substantial money from NFP to buy his expensive Vancouver home.
[96] It is admittedly easy to look at the settlement agreement through the lens of hindsight. The foregoing comments are not intended to be critical of the settlement agreement itself. Both parties were represented by very senior, experienced counsel. The parties made a bargain for spousal support and lived by it. This brought some peace. If NFP had suffered a precipitous decline in income, Mr. Plouffe would still have had to pay $4,000 monthly spousal support.
[97] Regarding the "condition, means, needs and other circumstances of the parties," in relation first to Mr. Plouffe, it is noted his current financial statement discloses a net worth of slightly over $6.4 million, with most of that attributed to NFP's value of $5.4 million (compared to its date of separation value of $1.667 million). Mr. Plouffe sold his Vancouver home in 2006 for $2.115 million (according to the statement of adjustments) and he used his equity from that property to purchase his current matrimonial home in London, now valued at $830,000 and located in an upscale residential neighbourhood. Mr. Plouffe's only debt (other than contingent taxes on RRSPs) is a line of credit in the amount of approximately $114,000. Ms. Plouffe's current financial statement discloses a net worth of $1.413 million (rounded). Her only debt is the $27,000 previously mentioned. Ms. Plouffe values her home at $431,500 and her other assets consist primarily of liquid investments, including RRSPs. Ms. Plouffe is very conscious of preserving her capital and therefore her investments are not high risk with the consequential low yields given today's investment market. A substantial portion of Ms. Plouffe's investment portfolio is traceable to the equalization payment she received. Ms. Plouffe drives a leased late model Ford Escape. She has encroached on capital for various maintenance and repairs to her home (including a new roof and furnace), with the only unnecessary expense being the installation of an in-ground pool.
[98] The date of marriage assets of both parties were very minimal. Hence, via the equalization process, each party in essence received 50 percent of their combined net worth as at date of separation. However, by the time of trial, more than nine years after separation, Mr. Plouffe's net worth has risen to over four times Ms. Plouffe's net worth.
[99] The reality is that Ms. Plouffe has been in a "standstill" position since the settlement agreement (and, in fact, since separation). The income that she receives, including child support, she spends to meet her expenses and Katie's expenses. Mr. Plouffe lives in a home worth almost twice the value of Ms. Plouffe's home and drives a late model Mercedes Benz. Mr. Plouffe testified in cross-examination that he travels frequently to Vancouver. These expenses are company paid. However, when asked in cross-examination whether he wrapped a little vacation time around these shows with his wife, he admitted that he did, testifying "Hey, who doesn't?" Mr. Plouffe claimed he did not do this very much "on the company dime" but I rather doubt that.
[100] I find on the evidence that Mr. Plouffe has been able to retain his pre-separation standard of living. However, the same is not the case for Ms. Plouffe and I find that her standard of living, although reasonable, is not at the same level as Mr. Plouffe's and is below the level it was during marriage.
[101] Ms. Plouffe's income for 2005 to 2010 inclusive was revealed in her income tax returns filed at trial. The only employment income received by Ms. Plouffe during this period was some very limited part-time income. Ms. Plouffe testified her hours worked were conducive to Katie's schedule. The following summarizes Ms. Plouffe's income from those years:
Year
Employment
Dividends, Interest, Taxable Capital Gains, Other Income
Spousal Support
Total Line 150
2005
$12,631.42
$48,000
$60,631.42
2006
$29,551.42
$48,000
$77,551.42
2007
$34,796.30
$48,000
$82,796.30
2008
$1,073.33
$27,623.67
$48,000
$76,697.00
2009
$1,813.44
$11,143.10
$48,000
$60,956.54
2010
$484.84
$4,095.07
$48,000
$52,579.91
Section 15.2(6)(a) – recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown
[102] At time of trial, close to 20 years after leaving her teaching career, Ms. Plouffe has no pension or income commensurate with a teaching career. Ms. Plouffe has had the benefit of a fairly sizeable equalization payment but Ms. Plouffe is not in a position to regularly encroach on that capital given her need to have money available for her retirement years. Ms. Plouffe also is limited as to the investment income she can earn and she testified as to her rapidly declining investment income because of low rates of return. Mr. Plouffe has clearly derived significant advantage during the marriage because he was able to build his business while Ms. Plouffe was at home minding the children. I find on the evidence that Mr. Plouffe has not suffered any discernable economic disadvantage as a result of the marriage or its breakdown.
Section 15.2(6)(b) – apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage
[103] Clearly, this objective intersects with subsection 15.2(6)(a). The support order should recognize the compensatory aspect of Ms. Plouffe's support claim. Further, the support claim is not only compensatory but it is also non-compensatory in nature and any order needs to recognize that.
Section 15.2(6)(c) – relieve any economic hardship of the spouses arising from the breakdown of the marriage
[104] Ms. Plouffe has had an accustomed standard of living during her marriage that has not been maintained to the same degree after separation as has Mr. Plouffe's standard of living. Ms. Plouffe has had to manage her money carefully and resist temptation to encroach on capital.
Section 15.2(6)(d) – so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time
[105] Ms. Plouffe was age 47 at time of trial. During the five year period of the "standstill" settlement agreement, I decline to fault Ms. Plouffe in making the decision to continue as a stay-at-home parent given the rather unique circumstances of supporting Katie's extensive pursuit of dance. In reaching their settlement, the parties in essence "agreed to disagree" whether Ms. Plouffe should continue to be a stay-at-home parent. Both parties agreed they would not provide financial disclosure to one another. Both parties benefitted from the standstill agreement in their own way. Ms. Plouffe was secure in the knowledge that she would receive spousal support for five years. She made the decision to support Katie in her dance career. On learning, shortly after the settlement agreement, about the expensive home Mr. Plouffe had just purchased in Vancouver, Ms. Plouffe elected to live with the agreement and conduct her affairs as she thought appropriate. That was the benefit to her. Mr. Plouffe used the five year time period to make a lot of money, knowing he did not have to account for that by way of additional spousal support (or even child support, except as noted in the agreement). Ms. Plouffe's refusal to take any steps to re-enter the workforce accordingly should be assessed in the context of the agreement as discussed above.
C. Amount and Duration of Spousal Support
[106] I concur with the position of both parties that on the facts of this case and considering all of the factors and objectives set out in the Divorce Act that a proper quantum of spousal support is $4,000 per month.
[107] On the issue of duration, there was no evidence at trial as to the likelihood of Ms. Plouffe being able to re-enter the teaching profession, if at all, especially considering the length of time she has been away from that profession.
[108] The flaw in Mr. Plouffe's position is that he focuses primarily on the objective of promoting Ms. Plouffe's self-sufficiency to the exclusion of other objectives. Even if Ms. Plouffe was employed as a teacher today, it is unclear on the evidence before me whether her income earned from that source would adequately address the combined compensatory and non-compensatory components of spousal support in this case. Put another way, if Ms. Plouffe could be earning $60,000 to $80,000 annually as a teacher (which was simply Mr. Plouffe's position without any evidence being called to support that position), it would still be necessary to examine the question as to whether Ms. Plouffe is entitled to support on either a compensatory or non-compensatory basis or both despite earning such an income.
[109] In Cassidy v. McNeil[^5], the Court of Appeal for Ontario reversed the trial decision of a time limited order of spousal support of $1,200 per month for five years, and substituted a spousal support order of $950 per month for an indefinite period, in circumstances where the parties were married 23 years, with children, and the wife's income was approximately $85,000 and the husband's income was approximately $137,000. Although Cassidy v. McNeil involved a longer marital relationship, it is noteworthy that spousal support was made indefinite where the wife's income was much higher than Ms. Plouffe's, and the husband's income was much lower than Mr. Plouffe's.
[110] Mr. Plouffe relies on Davies v. Quantz[^6]. In that case, after a marriage of a little over 18 years, with two children, Marshman J. ordered time limited spousal support to the wife in the amount of $9,440 per month for eight years based on the husband's income of $428,000. However, in my view, there are two distinguishing features. In that case, the wife had university degrees in commerce and science and had a solid work and income history during the first nine years of the marriage, after which the two children were born and the wife stayed at home. Also, the trial judge accepted the husband's evidence (and this was specifically noted by the Court of Appeal for Ontario) that when the children were in school fulltime the wife would return to the workforce (in contrast to the case at bar, where the evidence was clear as to Mr. Plouffe's agreement that Ms. Plouffe would remain a stay-at-home parent during the marriage even while the children were at school fulltime).
[111] I also find that Ms. Plouffe's care giving role is not in any way diminished by the fact that after separation and prior to the settlement agreement Jeffrey went to live with Mr. Plouffe and that Lisa elected to go to live with her father in 2008.
[112] Notwithstanding Ms. Plouffe's devotion to Katie's ambitions in dance, I wish to be clear that Ms. Plouffe needs to undertake in an earnest way appropriate steps to maximize her income earning potential. Although imputation of income to Ms. Plouffe at this time may be somewhat moot (given the position of both parties as to quantum), I do find that Ms. Plouffe should have made reasonable efforts to obtain some employment starting at least in 2011 such that her employment income coupled with any investment income yields her $30,000 per year. Accordingly, I impute that amount of income to Ms. Plouffe at this time applying the principles in Drygala v. Pauli[^7]. Ms. Plouffe has the ability and time to generate income, including a retail environment which was her more recent work experience. Ms. Plouffe's "teachable" is music and she did have an adult piano student at one time. Ms. Plouffe can explore also some self-employment income teaching music.
[113] After considering the factors and objectives, I decline to time limit spousal support. Having said that, the order must place an onus on Ms. Plouffe to maximize her earning potential. There is no reason for Ms. Plouffe to delay that endeavor. Ms. Plouffe needs to be aware that in Cassidy v. McNeil, although the Court of Appeal for Ontario ordered the spousal support to be payable indefinitely, the Court made the following statement (at para. 75): "I emphasize that 'indefinitely' only means that no termination date will be set at this juncture" [my emphasis].
[114] The SSAGs do apply in relation to reviews (see part 14.1 of the SSAGs). Using Mr. Plouffe's SSAG calculations for $200,000 for Mr. Plouffe and $32,000 for Ms. Plouffe (and substituting respectively the incomes of $275,000 and $30,000), the net result is that spousal support of $4,000 per month is in the range of $1,500 below the low range of the SSAGs (without considering any effect s. 7 expenses may have on the SSAG ranges)[^8]. Given the position of Ms. Plouffe regarding quantum and the fact that the spousal support is indefinite, this is a proper circumstance to make an order below the low range of the SSAGs.
[115] Accordingly, an order shall issue as follows in relation to spousal support:
Mr. Plouffe shall pay spousal support to Ms. Plouffe in the amount of $4,000 per month, indefinitely, commencing September 1, 2012;
Paragraphs 8, 9, 10 and 11 of the divorce order of Morissette J. dated December 7, 2005 are vacated effective the date of this order;
On February 1st of each year, commencing 2013, Ms. Plouffe shall provide to Mr. Plouffe the following, in writing:
a) a summary of all efforts made by Ms. Plouffe to secure employment during the preceding 12 months;
b) copies of all correspondence forwarded by Ms. Plouffe and received by Ms. Plouffe in relation to her endeavors to obtain employment during the preceding 12 months;
c) details of all steps taken by Ms. Plouffe in relation to vocational training or retraining, including any courses taken by Ms. Plouffe, and all supporting documentation, during the preceding 12 months.
- Ms. Plouffe shall advise Mr. Plouffe, in writing, immediately on obtaining employment, together with details of her employment income and she shall provide the supporting documentation.
S. 7 EXPENSES FOR KATIE
A. Retroactive Claim
[116] Ms. Plouffe has presented a comprehensive "dance expenses brief," with supporting invoices, setting out Katie's dance expenses for basically a three year period totaling $67,586.87 and Ms. Plouffe seeks an order that Mr. Plouffe should pay his proportionate share of these expenses.
[117] Ms. Plouffe's claim for retroactive s. 7 expenses fails for a number of reasons and her claim is dismissed for reasons explained below.
[118] Although Mr. Plouffe concedes that the settlement agreement and divorce order provide that each party is solely responsible for s. 7 expenses of the children in his or her care subject to variation as set out in the order, he argues that the only change in circumstances was in relation to Lisa coming to live with him, and he asks how could that trigger a s. 7 expense claim for Katie?
[119] Ms. Plouffe urges a literal reading of the divorce order and argues that if a child support review is triggered, then everything regarding child support is on the table including s. 7 expenses.
[120] While I have some sympathy for Mr. Plouffe's position, I do agree that the "trigger" mechanism does open up the potential for the court to review s. 7 expenses for Katie from the date of the change of circumstances (i.e. May 1, 2008).
[121] Having said that, however, Ms. Plouffe has insurmountable obstacles. First, she has filed no proper pleadings asserting a formal s. 7 claim. The relatively short affidavit (four pages) she filed in 2009 contains a brief reference to seeking s. 7 expenses and mentions that Katie is heavily involved in dance and that Ms. Plouffe has incurred $18,000 in expenses from June 2007 to June 2008. (It is noted that almost all of this period of time precedes the change of circumstances triggering the variation in child support requested by Mr. Plouffe.)
[122] It is not disputed that Ms. Plouffe gave Mr. Plouffe absolutely no information about the amounts or other details of the expenses claimed until approximately two days before trial.
[123] Most importantly, Ms. Plouffe in her evidence in-chief testified she never discussed these expenses with Mr. Plouffe in advance of the expenses being incurred. When questioned why, Ms. Plouffe testified these were her expenses for Katie, that the expenses were part of "our life" and that Ms. Plouffe was honouring the agreement. In cross-examination, Ms. Plouffe confirmed she did not seek Mr. Plouffe's consent, nor did she share the receipts with him.
[124] During cross-examination, Ms. Plouffe was referred to an email brief (Ex. 13) filed by Mr. Plouffe. A number of the emails related to requests for reimbursement by Ms. Plouffe in relation to Jeffrey or Lisa. The reimbursement requests were for various items but primarily clothing. Ms. Plouffe sought these reimbursements because the children, at the relevant time, were with Mr. Plouffe. A number of the emails contained in the brief were after May 2008 and the emails go to December 2011. Ms. Plouffe agreed that Mr. Plouffe reimbursed her for most of the expenses. When asked why she did not include Katie's dance expenses in this ongoing dialogue, Ms. Plouffe answered that Katie was her responsibility and Mr. Plouffe was responsible for Lisa and Jeffrey. Ms. Plouffe confirmed she had not requested any payment for Katie's dance expenses.
[125] In relation to Katie's dance expenses, I find that both Mr. Plouffe and Ms. Plouffe continued to operate under their settlement agreement and divorce order right up to trial and that this constituted, at the least, a mutual acquiescence as to the pre-trial status quo. (See, for example, Cassidy v. McNeil, supra, at para. 59, where the Court of Appeal for Ontario upheld the trial judge's refusal to award retroactive child support and spousal support on the basis that the trial judge had accepted the parties' "informal understanding or mutual acquiescence to the pre-trial status quo.")
[126] Alternatively, assuming there was no agreement to maintain the status quo after Mr. Plouffe commenced his motion to change child support, Ms. Plouffe's claims can be examined applying the principled analysis set out by the Supreme Court of Canada in S.(D.B.) v. G.(S.R.)[^9]. Assuming that the January 2009 affidavit filed by Ms. Plouffe constitutes "effective notice," it is quite apparent that thereafter Ms. Plouffe failed to provide any ongoing information regarding the s. 7 expenses. As stated in Forrester v. Forrester[^10], "The guidelines do not grant a licence to a custodial parent to inject a child into lavish additional activities and demand automatic payment." (See also Romeo v. Naidoo[^11] at para. 9, where the court finds that it is unreasonable to incur expenses for children's activities without telling the other parent, who has a right to know about the expenses, to allow that parent to budget for the expenses.)
[127] Applying the four factors discussed in S.(D.B.), Ms. Plouffe has not provided any excuse for her delay in providing details of her expenses to Mr. Plouffe. Mr. Plouffe has not engaged in any inappropriate conduct. There is no evidence Katie has suffered. The expenses were paid, though perhaps with some tight budgeting by Ms. Plouffe. Regarding the final factor, I find there would not be any financial hardship caused to Mr. Plouffe should he be ordered to pay his share of the s. 7 expenses. Balancing all of the factors on the facts of this case, supports the conclusion that Ms. Plouffe is not entitled to retroactive s. 7 expenses.
B. Prospective s. 7 Expenses
[128] Accepting Ms. Plouffe's evidence that Katie was only in her first year of competitive dance at the time of the settlement, there would have been no history of significant dance expenses during the marriage.
[129] Ms. Plouffe's evidence as to the high level of Katie's abilities in dance was not contradicted in any way by Mr. Plouffe – in fact, he presented as being supportive of Katie's endeavours. Given the elite level at which Katie competes and her obvious dedication to her craft, I find it is in Katie's best interests for her to be able to continue with her dance at a high competitive level. Mr. Plouffe submitted that, at most, his contribution should not exceed $200 monthly and if the court ordered more, then spousal support should be reduced.
[130] The determination as to Mr. Plouffe's contribution to s. 7 expenses includes examining which expenses are eligible to be s. 7 expenses, determining to what extent the expenses are "extraordinary" and applying the factors in the pre-amble to s. 7. I reject the submission that spousal support should be reduced if Mr. Plouffe's share of the s. 7 expenses exceeds the $200 monthly threshold.
[131] The definition of "extraordinary" is applicable and is set out as follows in s. 7(1.1) of the Guidelines:
Definition, "extraordinary expenses"
(1.1) For the purposes of clauses (1) (d) and (f),
"extraordinary expenses" means
(a) expenses that exceed those that the parent or spouse requesting an amount for the extraordinary expenses can reasonably cover, taking into account that parent's or spouse's income and the amount that the parent or spouse would receive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court has otherwise determined is appropriate, or
(b) where clause (a) is not applicable, expenses that the court considers are extraordinary taking into account,
(i) the amount of the expense in relation to the income of the parent or spouse requesting the amount, including the amount that the parent or spouse would receive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court has otherwise determined is appropriate,
(ii) the nature and number of the educational programs and extracurricular activities,
(iii) any special needs and talents of the child,
(iv) the overall cost of the programs and activities, and
(v) any other similar factors that the court considers relevant.
[132] Ms. Plouffe has grouped expenses into three categories: 1) classes and registration; 2) dancewear and accessories; and 3) travel. Although the expenses brief shows 2008 – 2009 grouped together, it appears that this is primarily to cover expenses for calendar 2009. Notwithstanding that there are some registration costs for 2008 included in these expenses, the simplest way to approach the expenses is to regard them as being for a period of three years – 2009, 2010 and 2011. I do not take into account some minor expenses shown for the beginning of 2012.
[133] The following are the annual averages for those three years under the various groups of expenses (rounded):
a) class / registration - $15,300
b) dancewear / accessories - $2,400
c) travel - $3,900
[134] Given that Ms. Plouffe accompanies Katie on her trips, and that hotel expenses are part of travel expenses, I reduce the annual travel expenses to $2,000 as an approximation of the added cost of having Ms. Plouffe attend. Her costs should not be part of Katie's s. 7 expenses.
[135] This results in an average annual expense of $19,700 ($15,300 + $2,400 + $2,000). These expenses, although high, are not unreasonable given the previously referred to elite level of competition.
[136] There is clearly a component of Katie's expenses that falls within the table amount of child support being paid by Mr. Plouffe. At some point, however, the expenses do become extraordinary. There is no scientific formula to distinguish between the two. I find that s. 7(1.1)(a) applies and doing the best I can on the evidence before me. I find that Ms. Plouffe can reasonably cover $10,000 of these expenses, leaving an excess of $9,700.
[137] Schedule III requires incomes to be adjusted for the purpose of s. 7 expenses. This requires the spousal support to be deducted from Mr. Plouffe's income. Ms. Plouffe's income for s. 7 purposes will include spousal support. Accordingly, using $275,000 and $30,000 as employment income, respectively, for Mr. Plouffe and Ms. Plouffe, the result is that Mr. Plouffe is responsible for 74.4 percent of the expense. This translates to $601 per month, which I round to $600. Accordingly, an order shall issue that Mr. Plouffe shall pay to Ms. Plouffe for Katie's s. 7 dance expenses the sum of $600 per month commencing February 1, 2012, based on Mr. Plouffe's annual income of $275,000 and Ms. Plouffe's imputed annual income of $30,000.
[138] I have later in these reasons provided for annual income disclosure by both parties. I am not making a formal order regarding how the expenses should be adjusted on an annual basis. I will leave that to Mr. Plouffe and Ms. Plouffe to work out after the disclosure is made. Hopefully, the parties will be able to avoid further litigation by applying the process in these reasons to make any necessary adjustments.
REGISTERED EDUCATIONS SAVINGS PLANS
A. Position of the Parties
[139] The issue in relation to the RESPs can be framed as follows:
• The RESP plans for each of Lisa and Jeffrey provide that the capital (after deduction of fees and expenses) is returned to the contributors (in this case, Mr. Plouffe and Ms. Plouffe) and Ms. Plouffe seeks to have the capital returned, while Mr. Plouffe takes the position that the capital should not be returned and then be used later for Katie's post-secondary education.
• The other related issue is the contribution made by Ms. Plouffe to Lisa's post-secondary education costs and Ms. Plouffe wants that amount returned to her from RESP capital.
B. The Relevant Facts and Discussion
i) The Agreed Statement of Facts
[140] Lisa's RESP was set up through University Scholarships of Canada. From the inception of the plan to the date of separation, the parties had accumulated joint contributions of $13,236.50 in the plan. After the date of separation, Ms. Plouffe alone contributed an additional $5,600. The capital contributions therefore totaled $18,836.50. When Lisa went to college, she received at least $9,697.11 in interest from the Plan.
[141] Ms. Plouffe has already received the entire return of principal (net of fees and expenses) from Lisa's plan, which totaled $13,168.89. Ms. Plouffe had cashed the two cheques representing the capital payout, payable jointly to Mr. Plouffe and Ms. Plouffe, by depositing the cheques to their joint account and then transferring the money to her sole account. The net amount paid by the Plan was after deducting $5,667.61 for fees and services. During the period July 2008 to April 2010, Ms. Plouffe paid out of her own funds the sum of $7,040.71 to pay for education costs for Lisa's attendance at Fanshawe College.
[142] Jeffrey had an RESP plan set up with CST Foundation (Canadian Scholarship Trust Plan), which is a different plan provider from Lisa's plan. From the inception of the plan until separation, Mr. Plouffe and Ms. Plouffe jointly contributed the sum of $11,895 to the plan. After separation, Ms. Plouffe alone contributed another $8,092.50 to the plan. Accordingly, Ms. Plouffe's contributions amounted to $14,040 and Mr. Plouffe's contributions amounted to the balance, being $5,947.50 (with the total contributions being $19,987.50).
ii) Discussion
[143] There was evidence from Ms. Plouffe, which I accept, that Katie has her own RESP.
[144] Ms. Plouffe proposes in her submissions that the fees and service charges be shared equally between the parties. In relation to Lisa's RESP, Ms. Plouffe proposes that she is entitled to receive her share of the capital contributions (net of 50% of the fees and service charges) plus the sum of $7,040.71, representing the post-secondary education cost she paid and, as against that total, all the money that was received by her from Lisa's plan would be deducted. The end result of this analysis is that Ms. Plouffe calculates she is owed $3,256.27 from Lisa's plan. Of course, this means Mr. Plouffe would have to pay this amount to Ms. Plouffe.
[145] In relation to Jeffrey's plan, Ms. Plouffe proposes that each party should receive his or her respective capital contribution to that plan, less 50% of the fees and service charges.
[146] The divorce order referred to the RESP accounts as follows in paragraph 6:
- The funds in the children's RESP accounts shall be used for the children's post secondary educational expense on the following terms:
(a) to the extent of the amount of the funds that existed on the date of separation, the parties will be given equal joint credit when assessing the contribution to be made by each party;
(b) to the extent of the amount of the funds contributed to the RESP accounts since the date of separation, credit will be given to the Applicant alone when assessing the contribution to be made by each party.
[147] The divorce order does not address the timing of the payout of the capital contributions from the RESP accounts.
[148] In relation to Lisa's RESP, it is clear that she has received money while going to college and that she is now working and living with her boyfriend. There is no basis to require Ms. Plouffe to preserve the capital from Lisa's plan. There was no evidence at trial that the capital from Lisa's plan could be "rolled over" into either Jeffrey's or Katie's plan. In fact, there was no evidence as to the details of Katie's plan other than the fact that one exists.
[149] In relation to Jeffrey, there is no evidence that he is intending to embark on a post-secondary education. Accordingly, there is no basis to oppose the payout of the capital in that plan.
[150] In his testimony, Mr. Plouffe failed to articulate any persuasive reason to avoid sharing the capital contributions of both plans at this time. Generally, I agree with the proposed distribution urged by Ms. Plouffe except for one area. I do not agree that Ms. Plouffe should simply receive a refund of the contribution she made to Lisa's post-secondary education costs. That cost should be shared between the parents pursuant to s. 7 of the Guidelines.
[151] The agreed statement of facts showed that the tuition payments were made over three calendar years, namely 2008, 2009 and 2010. On a technical basis, this would require allocating the exact tuition expense incurred in each calendar year and then, using the parties' incomes for that year, calculating the percentage of contribution for Mr. Plouffe after adjusting for spousal support as set out in Schedule III of the Guidelines. Counsel have not provided me with these calculations and, given the reasonably small amount involved, I have calculated Mr. Plouffe's percentage by using $300,000 (less $48,000 spousal support adjustment) for his income. For Ms. Plouffe's income, I have taken her incomes for those three years as set out in the SSAG calculations prepared by Ms. Plouffe and I have calculated the average annual income for those three years to be $15,862 which I round to $16,000. I have then used that as Ms. Plouffe's income, plus the $48,000 Schedule III spousal support adjustment. Accordingly, the percentage works out to approximately 79.9%, which I round to 80% for Mr. Plouffe's contribution towards the s. 7 expenses. The dollar amount comes out to $5,632.57, which I round to $5,600.
[152] Accordingly, the following order shall issue in relation to the RESPs:
- With respect to Lisa's plan:
a) Ms. Plouffe is entitled to $9,384.44 ($6,618.25 (joint) plus $5,600 (sole) minus $2,833.81 (50% of the fees));
b) plus a further $5,600 as reimbursement for Mr. Plouffe's share of Lisa's post-secondary education costs paid by Ms. Plouffe;
c) for a total entitlement of $14,989.44;
d) less the amount already received of $13,168.89;
e) leaving a balance owing by Mr. Plouffe to Ms. Plouffe of $1,815.55.
- In relation to Jeffrey's plan:
a) Ms. Plouffe is entitled to her capital contribution totaling $14,040 plus (from Mr. Plouffe's share) $1,815.55, equals $15,855.55;
b) Mr. Plouffe is entitled to his capital contribution, totaling $5,947.50 minus $1,815.55, equals $4,131.95;
c) From each party's share shall be deducted 50% of the fees and service charges levied by the plan; and
d) In the event that Mr. Plouffe's 50% share of the fees and service charges exceeds Mr. Plouffe's net entitlement as set out in subparagraph (b), then Mr. Plouffe shall reimburse Ms. Plouffe for the excess amount.
- The parties shall sign all necessary documentation required by Jeffrey's plan in order to allow the plan to pay out the capital (less any fees and service charges), as set out in this order. Should any further documentation be required by Lisa's plan to comply with this order, then each party shall sign and provide that documentation.
[153] In the event that there are any arithmetic errors in the above calculations, counsel may arrange with the trial coordinator to speak to this matter or, alternatively, file some additional brief written submissions regarding any necessary arithmetic adjustment.
ORDER
[154] I have not dealt with the issue as to whether the support payments pursuant to this order should be binding on Mr. Plouffe's estate (similar to para. 18 of the divorce order) as no submissions were directed on that point. However, if counsel agree, that provision can be included in this order. If there is any dispute on this point, or if there are any other technical matters that need to be dealt with, counsel may arrange with the trial coordinator for an appointment to speak to those matters.
[155] A final order shall issue in accordance with the reasons set out above and in addition the final order shall include the following:
Within 30 days of the date of this order, each party shall provide to the other for the year 2011 a copy of his or her T1 general income tax return, together with all slips and schedules and his or her notice of assessment (and notice of re-assessment, if any) and further, each party shall provide all additional documentation as required by s. 21 of the Federal Child Support Guidelines;
Each year by the 1st day of May, commencing 2013, each party shall provide to the other a copy of his or her T1 general income tax return, together with all slips and schedules for the immediately preceding calendar year, together with the notice of assessment (and notice of re-assessment, if any) and, further, each party shall provide all additional documentation as required by s. 21 of the Federal Child Support Guidelines. If the notice of assessment or re-assessment has not been received by May 1st, then it shall be provided within 10 days of receipt;
The obligation to provide the disclosure as set out in paragraph 2 shall continue for so long as spousal support or child support is required to be paid pursuant to this order;
Paragraph 5 of the divorce order of Morissette J. dated December 7, 2005 (dealing with s. 7 expenses) is vacated effective April 30, 2008.
If the parties are unable to agree as to costs within 30 days, then counsel shall contact the trial coordinator to arrange time to speak to the issue of costs and this matter may be scheduled at 9:30 a.m. If either counsel is relying on a bill of costs or authorities, then those documents shall be exchanged between counsel within a reasonable time prior to the costs hearing.
"Justice Victor Mitrow"
Justice Victor Mitrow
Released: August 28, 2012
[^1]: Wildman v. Wildman, 2006 33540 (ON CA), 2006 CarswellOnt 6042, 215 O.A.C. 239, 82 O.R. (3d) 401, 273 D.L.R. (4th) 37, 33 R.F.L. (6th) 237 (Ont. C.A.) at para. 27. [^2]: 2007 14631 (ON SC), 2007 CarswellOnt 2732, 39 R.F.L. (6th) 72, 157 A.C.W.S. (3d) 377 (Ont. S.C.J.) at paras. 84 – 104. [^3]: 1992 25 (SCC), 1992 CarswellMan 143, [1993] 1 W.W.R. 481, 43 R.F.L. (3d) 345, [1992] 3 S.C.R. 813, 99 D.L.R. (4th) 456. [^4]: [2006] 1 S.C.R. 920, 2006 SCC 25. [^5]: 2010 CarswellOnt 1637, 2010 ONCA 218, 99 O.R. (3d) 81, 266 O.A.C. 62. [^6]: [2010 ONSC 416]; affirmed by the Court of Appeal for Ontario at 2010 CarswellOnt 9748, 2010 ONCA 896, 100 R.F.L. (6th) 176. [^7]: 2002 41868 (ON CA), 61 O.R. (3d) 711, [2002] O.J. No. 3731 (Ont. C.A.). [^8]: Using the incomes noted, showing Katie with Ms. Plouffe and using tools 2K12, the SSAGs generated $5,493 - $6,296 - $7,087 (low, mid, high). [^9]: 2006 CarswellAlta 976, 2006 SCC 37, 270 D.L.R. (4th) 297, 31 R.F.L. (6th) 1, [2006] 2 S.C.R. 231. [^10]: 1997 15466 (Ont. S.C.J.). [^11]: 2006 ONCJ 302.