KITCHENER COURT FILE NO.: 30794/99

DATE: 2012/01/31

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

LEE ANNE FISHER (ROGERS)

Applicant

• and -

CHRISTOPHER MARK ROGERS

Respondent

Counsel: Theodore C. Dueck, for the Applicant Brian R. Kelly, for the Respondent

HEARD: Sept. 21, 22, 23, 26 & 27, 2011

BEFORE: The Honourable Madam Justice W.L. MacPherson

[1] This was the hearing of a Motion to Change brought by the Respondent (“father”) to change the Divorce Judgment of Justice Glithero (“order”) dated July 5, 2000. The hearing took place over 5 days (September 21, 22, 23, 26 and 27, 2011).

[2] The order required the father to pay spousal support of $2,000.00 per month to the Applicant (“mother”) and child support for two children in the amount of $3,758.00 per month. This level of support was based on the father’s annual income in 1999 of $342,000.00 which arose from his dental practice. There are other relevant terms of the order that will be detailed below.

[3] The father sold the dental practice in June 2006 and moved to Honduras. He returned to Canada in 2009 and as of April 2009 he has been engaged in dentistry on a part-time basis. He requests the following relief:

a) Termination of his support obligation for Bradley retroactive to September 2005.

b) Adjustment of his support obligation for Caitlyn retroactive to January 2006 to be based on the changes in his income as reflected in his tax returns, except for 2006 where there should be an adjustment excluding the capital gains on the sale of the dental practice.

[4] On the father’s calculations, he has overpaid child support and there should be no further child support payable.

[5] The mother submits that there should be a variation of the child support payable based on the father’s actual income to include income from the dental practice and the incorporated hygiene practice and that income should be imputed to the father based on the income that he was earning prior to the sale of the dental practice in 2006. On the Applicant’s calculations there are substantial arrears owed relating to table child support for the two children and for s. 7 expenses, essentially comprised of post-secondary education expenses for both children.

[6] The issues to be determined on this motion are as follows:

1. Has there been a material change in the father’s financial circumstances that would justify a variation in the amount of child support payable by the father?

2. Re: Bradley

a) When did he cease to be a “child of the marriage”?

b) What amount of child support and/or s. 7 expenses should have been paid by the father?

3. Re: Caitlyn

a) What amount of child support and/or s. 7 expenses should have been paid by the father and on an ongoing basis?

Background

[7] The parties were married on August 13, 1983. They separated in June 1998 and were divorced on July 5, 2000. There were two children of the marriage, Bradley David Rogers, born December 17, 1986, and Caitlyn Mary Rogers, born July 25, 1990.

[8] The relevant terms of the order were:

[9] The parties were to share joint custody of the two children Bradley and Caitlyn.

[10] The parties were equally entitled to receive information from one another and third parties with respect to the needs and welfare of the children and were to share equally the right to input into major decisions affecting the children. The mother was to foster a positive and close relationship with the father.

[11] As set out above, and based on his 1999 income of $342,000.00, the father was to pay the sum of $3,758.00 per month and continuing so long as a the children remain “children of the marriage” within the meaning of the Divorce Act.

[12] From the monthly child support, the mother was required to contribute $300.00 per month to a registered education savings plan for the children of the marriage. Further, the mother was responsible for paying for all extra-curricular activities and camp costs for the children.

[13] In the event that either of the children did not use the registered education savings plan deposits for the purpose of continuing education, the funds would be used toward the educational costs of the other child to the maximum extent available, and any sum remaining would, subject to the provisions of the Income Tax Act, be divided equally between and paid to the children.

[14] The amount of child support payable would be based on the father’s income as disclosed in his tax return and filed with Revenue Canada for the preceding year, provided that any income paid by him to his wife or common-law wife through his dental practice, would be attributed to him for support purposes. The parties were to exchange their income tax returns and notices of assessments on an annual basis.

[15] The father was to pay spousal support to the mother in the amount of $2,000.00 per month commencing August 1, 2000. Such support was non-variable for a period of three years, at which time the spousal support could be reviewed. The obligation to pay spousal support continued until the wife was remarried in June 2006 although it took until May 26, 2008 for the FRO records to be adjusted with a credit of $46,000.00 being made.

[16] The father continued to pay child support for Bradley until January 2006 as that was the first notification he received that the child was no longer attending college. Child support has continued to be paid for Caitlyn but the amounts have varied since the order was made in July 2000.

1. Has there been a material change in the father’s circumstances that would justify a variation in the amount of child support payable by the father?

The Law

[17] The applicable legislation is the Divorce Act (R.S. 1985 c. 3 (2nd Supp.) as am.)

[18] Under s. 17,

(1) A court of competent jurisdiction may make an order varying, rescinding or suspending, prospectively or retroactively,

(a) a support order or any provision thereof on application by either or both former spouses;

(4) Before the court makes a variation order in respect of a child support order, the court shall satisfy itself that a change of circumstances as provided by the applicable guidelines has occurred since the making of the child support order or the last variation order made in respect of the order.

(6.1) A court making a variation order in respect of a child support order shall do so in accordance with the applicable guidelines.

[19] Section 19 (1) (a) of the Child Support Guidelines (“guidelines”) reads:

The court may impute such amount of income to a spouse as it considers appropriate in the circumstances which include the following:

a) The parent or spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of a marriage or any child under the age of majority or by the reasonable educational or health needs of the parent or spouse.

[20] The Ontario Court of Appeal in Drygali v. Pauli 2002 CanLII 41868 (ON CA), 2002 29 R.F.L. (5th) 293 sets out the analysis to be undertaken in determining whether to impute income to a spouse under s. 19 (1) (a) of the Guidelines. The three step analysis is as follows:

1. Is the spouse intentionally under-employed or unemployed?

2. If so, is the intentional under-employment or unemployment required by virtue of his reasonable health needs?

3. If the answer to question 2 is negative, what income is appropriately imputed in the circumstances?

The Law and Analysis re: Intentional Under-employment or Unemployment

[21] As stated by Justice Gillese:

Read in context and given its ordinary meaning, “intentionally” means a voluntary act. The parent required to pay is intentionally under-employed if that parent chooses to earn less than he or she is capable of earning. That parent is intentionally unemployed when he or she chooses not to work when capable of earning an income. The word “intentionally” makes it clear that the section does not apply to situations which, through no fault or act of their own, spouses are laid off, terminated or given reduced hours of work.

[22] After considering the scheme of the legislation and its objects, the Ontario Court of Appeal confirmed that there is no requirement of bad faith. Unlike the Alberta Court of Appeal which found that there needs to be an intention to avoid child support, in Ontario there is no need to find a guilty intention before the court can find that there has been intentional under or unemployment.

[23] Reference is then made explicitly to s. 26.1 (2) of the Divorce Act, R.S.C. 1985 (2nd Supp.) c. 3 as amended, which provides that the guidelines “shall be based on the principle that spouses have a joint financial obligation to maintain the children of the marriage in accordance with their relative abilities to contribute to the performance of that obligation.” Further under s. 1 of the guidelines, one of its objectives is to establish a fair standard of support for children to ensure that they benefit from the financial means of both parents after separation. The decision then continues: “Imputing income is one method by which the court gives effect to the joint and ongoing obligation of parents to support their children. In order to meet this legal obligation, a parent must earn what he or she is capable of earning.”

[24] Turning to the facts of this case, while I was invited by counsel for the mother to find bad faith on the part of the father and to impute sinister motives (avoidance of child support) behind the decision to sell the dental practice, I do not make such a finding nor is that a necessary prerequisite to a finding that the father is intentionally unemployed.

[25] On the facts before me, the father voluntarily gave up a lucrative and profitable dental practice from which he was earning a significant income. I have no difficulty in finding that the father was intentionally unemployed from June 2006 until March 2009 and that he had been under-employed for the remainder of 2009.

Facts Re: Reasonable Health Needs

[26] The next issue that must be determined is whether the unemployment/underemployment occurred as a result of the reasonable health needs of the paying parent.

[27] Justice Gillese made it abundantly clear who bears the onus of establishing reasonableness of the health needs:

There is a duty to seek employment in a case where a parent is healthy. As a general rule, a parent cannot avoid child support obligations by a self-induced reduction of income. Thus, once it is established that a spouse is intentionally unemployed ...the burden shifts to that spouse to establish [that the unemployment was] required by virtue of his reasonable [health] needs.

[28] The father was born on June 20, 1958. He testified that he had suffered from back problems during the marriage and that this is common to those who practice dentistry. However, he confirmed that until mid-2004 he was in good shape and was active and healthy. Between then and when the practice sold in June 2006 (when he was 48 years of age) he testified that he suffered from anxiety, panic attacks and depression on an escalating basis. He also testified that he had pain in his hands and also in his back, which caused numbness in his legs. He stated that he was physically in pain all the time.

[29] The father gave evidence that he attempted to address these problems through counselling with Glenn Boyes. He also attended at his family doctor, Dr. Christopher-Patel, and took steps to deal with the physical ailments by attending at the Waterloo Sport Medicine Clinic (WSMC) and doing acupuncture, massage therapy and stretching exercises. He was adamantly opposed to taking any prescription medication as he did not wish to affect his job performance and jeopardize his patients. But despite these efforts, he stated that he found the combination of emotional and physical problems to be too debilitating and he had no choice but to sell the dental practice.

[30] It was apparent from the testimony and records of Dr. Patel-Christopher that until mid 2004 the father was generally healthy. He had been her patient since 1997 and had consulted with her infrequently. In 2004 (August and October) the father consulted with his family doctor concerning pain in his hands. After conducting tests it was apparent that there was no arthritis and that the pain was caused by repetitive strain, with treatment being the application of ice, bracing and taking anti-inflammatory medicine. Dr. Christopher-Patel stated that this problem could pretty easily have been resolved with such treatment.

[31] With regard to emotional difficulties, Dr. Christopher-Patel confirmed that the father consulted with her in January 2005 regarding stress from dealing with financial commitments from the divorce. She confirmed that the father wanted counselling to address these issues, but that she did not refer him to anyone in particular. In 2005 there were two other consultations. On June 22 the father reported that he had chest pains while at home which lasted about five minutes and that he had also had panic attacks while at work. The doctor confirmed that she would have likely have suggested anti-depressants or sleeping pills, but the father was reluctant to take any medication. On December 7, the father reported that he had pain in his lower back that extended into his right leg. She referred the father to the WSMC (Dr. Trevor Hall) for further testing and physiotherapy. Dr. Christopher-Patel confirmed that she would likely have offered various narcotics to assist the father in dealing with the pain, but she confirmed that she never prescribed such medication as he was concerned about the side effects and how they could affect his job performance.

[32] The father attended at WSMC in January 2006. Dr. Trevor Hall referred him for an EMG and MRI. Dr. Christopher-Patel confirmed that the Nerve Conduction Report (January 30, 2006) showed no remarkable findings and that all was normal. She also confirmed that the MRI report (February 20, 2006) from Toronto Western Hospital showed normal findings on the lumbar spine except for the L3-L4. In one part of the report there was reference to “diffuse bulging of disc...causing mild-to-moderate spinal canal stenosis... with reference to facet joint arthritis. Later in the report there is a finding of “diffuse bulging of disc...causing moderate-to severe spinal stenosis at this level”. Dr. Christopher-Patel confirmed that stenosis - a narrowing of the spinal canal - would be consistent with back pain, in particular in the lower back. She also confirmed that the changes noted were common with aging and that many people experience arthritic changes in the lower spine. She confirmed that the test results did not warrant a referral to an orthopaedic surgeon. The treatment options would have included physiotherapy (which was available at WSMC) and massage therapy. Dr. Christopher-Patel indicated that there was no way to predict how long such therapy would have been needed. Some people turn chronic, while others improve after a few weeks with modification to physical activities and stretching exercises, with the pain settling down on its own. She confirmed that there were no discussions with the father about modifying his hours at work nor did they have any subsequent discussions about any other treatment options that could be considered.

[33] Neither the doctor who performed the MRI nor Dr. Trevor Hall from the Sports Medicine clinic was called to testify. There were no records provided as to the treatments, if any, undertaken by the father at WSMC.

[34] There were no further consultations by the father with Dr. Christopher-Patel in 2006 regarding back problems and although there was a reference in the physician’s notes (May 30) that the father was retiring and moving to Honduras, in her testimony she did not recall any discussion about his intention to sell the dental practice.

[35] Glenn Boyes testified that the father attended for 10 sessions of counselling between January 2005 and March 2006. He confirmed that the father presented as being anxious and depressed, which was evidenced by the father’s lack of motivation to go to work. He expressed that he wanted to walk away from it all. Early in the sessions, he expressed a loss of control about his financial situation and there was a discussion as to whether he was “trapped” and was directed to consult with his lawyer. As the father did not get the answer from the lawyer that he had hoped, Mr. Boyes confirmed they discussed moving within Canada so as to be able to have a slower lifestyle. The counsellor also suggested that the father document his “health” issues.

[36] After returning from a vacation to Honduras in April 2005, the father met with the counsellor in May 2005 and confirmed that he had made the decision to move on and that the father would start implementation immediately. The counsellor provided the father with breathing strategies for dealing with his anxiety and a recent panic attack at work and it was noted by the counsellor that this should be documented with his physician.

[37] Subsequent meetings with the counsellor were less frequent as the father had made improvements, with the counsellor noting that the father indicated that he was “back in control” and that he had set time lines for selling the dental practice. He was no longer having panic attacks at work and while there was still stress, it was good stress and he was able to manage it. Subsequent meetings with the counsellor related to issues concerning his poor relationship with his parents; how to tell his business partner about his plan to leave the practice and help in developing a strategy for telling the children that he was leaving the country. His relationship with the children had not previously been the topic of discussion, except for a comment that they did not have good communication with one another and a general discussion about the children’s college expenses. Mr. Boyes was aware from their discussions that the father felt under financial pressure, but he did not recall a specific discussion about the spousal support ending when the mother was to be remarried in June 2006.

[38] On February 2, 2006, the father advised the counsellor that he had a disc problem in his back with numbness in his legs since November 2005. Mr. Boyes confirmed that this was the first discussion that they had regarding any physical ailments. On March 16, 2006, they met for the final time as the notes indicated that everything was going well.

Analysis Re: Whether Unemployment Was Necessitated by Health Needs of Father

[39] While there may have been some physical difficulties that arose as a result of the father having worked as a dentist on a full-time basis for more than 20 years, after considering all of the evidence – including the chronology of events, the evidence regarding the counselling with Glenn Boyes and the testimony of the family doctor, I find that there was no reasonable necessity of the father becoming unemployed based on his health needs.

[40] The 14 acre property in Roatan, Honduras was purchased in April 2004. The decision to move to Honduras was made as early as May 2005 with plans well under way to implement this plan by August 2005. As early as December 2005, the father had begun discussions with Hill Kindy about the sale of the dental practice and on February 6, 2006, the practice was formally listed for sale. The MRI test results were not received until February 20, 2006.

[41] While the father stated that he did physiotherapy and massage therapy to address the back pain, there was no evidence as to when these were attempted and the frequency of same. There was also no evidence of any other alternatives that were explored to continue the dental practice albeit on a reduced basis. Such alternatives might have included working reduced hours; taking in another practicing dentist; sharing the administrative work. While it was commendable that the father did not want to take medication that might impair his job performance, the decision to quit the practice entirely before any real effort had been made to remedy the health concerns was not justified given the legal obligation on the father to earn what he was capable of earning to support the children.

[42] Although I do not accept the submission of the mother’s counsel that the father was attempting to falsely document his emotional and physical complaints to support his decision to retire, neither the evidence from the counsellor or the family physician was particularly helpful in supporting the father’s position that his unemployment was necessary and unavoidable in the circumstances.

[43] The onus was on the father to establish that his health condition (physical and emotional) provided a reasonable justification for his unemployment. On all of the evidence, he has not met that onus as it was not reasonable for him to have quit the dental practice in June 2006.

The Law and Facts Re: Quantum of Income to be Imputed

[44] Having found that the father was intentionally unemployed and that this unemployment was not reasonably justified by his health needs, I must now determine what income should be imputed to him for purposes of child support.

[45] As to the applicable principles, I refer again to Justice Gillese in the Pauli v. Drygali decision:

Section 19 of the Guidelines is not an invitation to the court to arbitrarily select an amount as imputed income. There must be a rational basis underlying the selection of any such figure. The amount selected as an exercise of the court’s discretion must be grounded in the evidence.

When imputing income based on intentional under-employment or unemployment, a court must consider what is reasonable in the circumstances. The factors to be considered have been stated in a number of cases as age, education, experience, skills and health of parent.

[46] There was no dispute regarding the amount of the father’s income for the years immediately following the order:

2000 $373,721.89

2001 $413,166.46

2002 $378,356.61 (after deducting RRSP income)

2003 $379,346.41

[47] Nor was there any dispute that the proper adjustments had been made for the child support payable to and including December 1, 2004. Donald McIntyre had represented the mother in the divorce proceedings and he continued to represent her in 2003 and 2006 in relation to negotiations as to adjustments to be made to the child support payments. He testified at the trial and confirmed that the first adjustment was made in 2003 (for 2000, 2001 and 2002) when the father paid a support adjustment of $13,416.00 plus interest, with the payments being made in monthly installments ending in September 2005. The second adjustment was made in 2006 (for 2003, 2004, and 2005 to and including March 2006) when the father paid an adjustment of $8,341.87 in June 2006.

[48] The second adjustment was based on the following set of circumstances:

1. The 2004 income used for the father was $392,796.00 as reported on Line 150 of his personal income tax return.

2. In January 2006, the father’s counsel had requested clarification regarding Bradley’s status at college. It was indicated by Mr. McIntyre (on behalf of the mother) that although the child had enrolled in Conestoga College in September 2005, he had stopped attending. It was also indicated that he had registered for enrolment in an alternate program for September 2006, but his acceptance would not be confirmed until June 2006. The mother’s counsel confirmed that the child support obligation for Bradley should cease. When calculating the child support payable by the father for 2005 (based on the 2004 income of $392,796.00) Mr. McIntyre showed that the sum of $4,286.07 per month was payable for two children from January to August 2005 and $2,734.73 per month was payable for one child from September 2005 until December 2005.

3. The 2006 child support was based on projected 2005 income for the father in the amount of $307,990.00 with child support of $2,166.53 per month being payable for Caitlyn only. A request was made for the father’s corporate financial statement for 2005 once it had been completed. Mr. McIntyre confirmed that he did not receive this financial statement nor was he aware that there was a second corporate entity that had been created in the operation of the dental practice.

4. The Child Support Guidelines in effect as of 1997 were applied.

[49] It should be noted that the mother had no recollection of any adjustments having been made to the child support until shown the documentation between the lawyers. She attributed this to having been very ill at that time. By agreement of the parties, the order was not varied but instead the adjustment payments were paid directly to the mother rather than through the Director of Family Responsibility Office.

[50] The parties disagreed as to the father’s income to be used for the subsequent years. It was the father’s position that the income to be used for child support purposes was as follows:

2004 $392,796.54

2005 $243,328.70

2006 $494,281.00 (actual dividend and excluding capital gain on sale of office and practice)

2007 $ 2,744.00

2008 $ 47.00

2009 $ 67,099.10

2010 $130,713.17

[51] However, it was also his position that there was no basis to adjust the child support calculation prior to January 2006.

[52] The mother’s counsel took the position that there were various options available to the court to impute income to the father based on one of three scenarios:

(a) Imputed three year average $396,576.00 (2005 to 2009)

$130,713.00 (2010 and 2011)

(b) Income at the time the order was made $342,000.00 (2005 to 2009)

$130,713.00 (2010 and 2011)

(c) Actual Line 150 Income plus RW Hygiene income (in 2004, 2005 & 2006)

2004 $416,854.00

2005 $393,526.00

2006 $851,691.00 (adjusted for capital gains and dividends)

2007 Nil

2008 Nil

2009 $ 67,099.00

2010 $130,713.00

2011 $130,713.00

[53] The court heard evidence from Wayne Drew who had been a chartered accountant since 1977. He confirmed that he had done the accounting work for the father and his dental practice beginning some time prior to 2000 and ending in 2008. This had included the preparation of the Partnership and Corporate Financial Statements, as well as Personal and Corporate Tax returns.

[54] Mr. Drew confirmed that until 2004, the sources of the father’s income had been partnership income from his dental practice with Dr. Patrick Winter and any income derived from 1427621 Ontario Ltd (“142”) which owned the land and building from which the dental practice was operated. The only source of revenue for this corporation was rent paid by the dental practice.

[55] On June 30, 2004 another corporation RW Hygiene Inc (“RW”) was incorporated, with fifty per cent of the shares being owned by 142 and the other fifty per cent being owned by Dr. Winter’s corporation.

[56] The hygiene services provided in the dental practice were billed to RW which allowed a share of the overhead expenses to be allocated to RW, thereby reducing the expenses of the partnership. Mr. Drew confirmed that as a result of the incorporation of RW, after 2004 the Financial Statements for the Dental Partnership would represent only a portion of the total income being earned by the father from the dental practice. For 2004, he indicated that the Financial Statements would have been correct with the exception of one or two months of revenue and expenses which would have been shown in the 2004 RW Financial Statement.

[57] The 2004 RW statement showed revenue of $150,921.00 and earnings before taxes of $48,884.00 and after taxes of $38,884.00. Mr. Drew testified that but for the existence of RW, the father’s income in 2004 would have been $392,347.00.

[58] In 2005, which was the first full year that RW was in operation, there were revenues earned of $950,295.00, earnings before taxes of $300,394.00 and after tax earnings of $244,447. Mr. Drew testified that but for the incorporation of RW, the father’s income in 2005 would have been $396,736.00. This was clearly higher than the income of $243,328 as shown in his 2005 tax return and was also higher than the projected income ($307,990.00) used by Mr. McIntyre in adjusting the child support payable by the father for 2006.

[59] Mr. Drew was clear that it had been his suggestion to establish a separate corporate entity to deal with the hygiene revenue and that this and any other advice was done in a commercially reasonable manner in accordance with Generally Accepted Accounting Practices. The goal would have been to obtain the best tax advantages for the father, which in this case, meant obtaining a tax deferral and minimizing the tax liability that was owed. As he explained, the father’s tax returns did reflect all of his income, but there were tax deferrals in place. At some point either when the company was wound up or upon the death of the shareholder, the full tax liability would become due.

[60] It was apparent from the RW Financial Statements that dividends had been declared, but as explained by Mr. Drew, these were essentially paper transactions rather than any money actually having been paid to the father. It was for that reason that no dividend income was shown in the father’s income tax returns as these had been paid to 142. He also explained that the income earned by the father needed to be three times the amount of the dividend before it would have been worthwhile to have 142 pay a dividend to the father.

[61] Mr. Drew denied that there was anything nefarious or illegal in what was done on behalf of the father. He was adamant that if the father had come to him requesting that he structure the dental business in such a way as to hide income, he would not have kept him on as a client.

[62] The second area of dispute was with regard to the income to be used for the father in 2006, which was the year that the father ceased to practice dentistry and sold both the building and his interest in the dental practice. In the tax return for that year, the father’s Line 150 income was shown as $986,916.83 comprised of:

a) Taxable Dividends $457,122.63

b) Interest $ 6,662.10

c) Taxable Capital Gains $383,210.50

d) Professional Income $121,921.60 (to June 2006)

[63] Based on the documentation filed and referenced at trial, the net sale proceeds from the sale of the land and building was $315,437.13 payable to 142. Further, from the sale of the dental partnership and RW the net sale proceeds were $544,396.41. From the proceeds of almost $860,000.00 the father had a tax liability of just over $250,000.00 as shown in the father’s 2006 tax return.

[64] The father’s counsel submitted that the proper calculation of the 2006 income ($494,281.58) was to use the actual dividend paid $365,697.88 (after deducting the 25% gross up) plus the Interest Income and the Professional Income, but exclude the taxable capital gains of $383,210.50 entirely as it was a one-time non-recurring event that flowed from the sale of an asset that had already been equalized.

[65] The mother’s counsel submitted that some portion of the taxable capital gains should be added, with the figure suggested being the increase in the value of the corporation since the parties’ property was equalized in 2000. Counsel relied on the father’s net family property value of $210,000.00, and attributed 50% of the increase in value or $357,409.42 in support of his position that the father’s 2006 income should be $851,691.00.

Analysis Re: Quantum of Income to be Imputed to the Father

[66] Wayne Drew gave his evidence in a straightforward and impartial manner. Although he was the father’s accountant, he was an excellent witness (as conceded by the mother’s counsel) and I have no hesitation in accepting his evidence regarding the income of the father. While the mother’s counsel attempted to infer from the accounting techniques that the father was trying to conceal income so as to reduce his obligation to pay child support that theory was not borne out by the evidence.

[67] I accept that the father was not sophisticated in financial and accounting matters. He believed that he had drawn out all monies available from the partnership and corporations and that he had declared all dividends as required. He deferred to the accountant on these issues, who provided a legitimate and understandable explanation for this. As such I make no finding that there was an intent by the father to hide income. However, it is clear from Mr. Drew’s evidence that that there was additional income that should have been included in the father’s income when calculating the child support payable for 2005 and 2006. Accordingly, I find that the father’s income for child support purposes was $392,347.00 in 2004 (to be used for child support payable in 2005) and $396,736.00 in 2005 (to be used for child support payable in 2006).

[68] With regard to the father’s income for 2006 and subsequent years, on the basis of my finding that the sale of the dental practice was not reasonable based on the father’s health needs, it would be inherently inconsistent to then impute income to him based on the 2006 tax return which reflects the sale of the dental practice and real estate and the realization of substantial income that had previously been deferred through the structuring of the corporations.

[69] I have considered the submission of the wife’s counsel that the income to be imputed to the father could be based on an average of the three years prior to 2006 ($379,346.00, $392,347.00, $396,736) in the amount of $389,476.33.

[70] However, after considering all of the relevant circumstances, including such matters as the father’s age, the physical nature of his job and the physical complaints, it would not have been unreasonable for him to have begun to work fewer hours in the dental field, resulting in a somewhat reduced income. The father testified that he was working a considerable number of hours in order to earn a level of income approaching $400,000.00. While he was earning more than he did at the time of the order, I accept that in order to earn that level of income he was working excessive hours and that may have contributed to some of the physical difficulties that he was encountering with his hands and back in 2004 and 2005.

[71] The father also testified that he was under considerable financial pressure as a result of the divorce and the financial obligations to the mother and the children. It became clear under cross-examination that a very large part of this pressure arose from a liability to Revenue Canada of $456,836.20 for non-payment of income taxes. The father entered into a Proposal under the Bankruptcy and Insolvency Act in September 2002, and after the disposition of certain assets and payments on account of this indebtedness, the outstanding balance of $192,000.00 was to be satisfied by monthly payments of $4,000.00 over a four year period ending in September 2006. The spousal support obligation also ended in June 2006 with the remarriage of the mother.

[72] Accordingly, while I have found that the health difficulties of the father were not career ending and did not justify the father giving up the dental practice entirely, based on the medical evidence and the changes in the father’s financial liabilities it would not have been unreasonable for the father to have begun working fewer hours in 2006, which would have also reduced his income for support purposes.

[73] In all of the circumstances, I would impute income to the father in the amount of $342,000.00 commencing in 2006 and continuing until 2008, which is the income level to be used to calculate the child support payable for 2007, 2008 and 2009.

[74] The father testified that he was only permitted to remain in Honduras for up to 90 days at a time and so between 2006 and 2009, he was continuously returning to Canada. It was not clear from the evidence when he determined that he would seek employment as a dentist. The documents produced regarding the Sauble Beach property confirm that this was purchased in June 2008. The father began working in April 2009, but did so only two days per week. As he chose to work only two days per week and only worked nine months of the year, his income was less than $70,000.00 in 2009. It was unclear when he began to work two to three days per week. However, his income in 2010 from working part-time hours (five out of every ten days) was $130,713.00.

[75] The mother’s counsel conceded that the father’s current income from working half-time is an appropriate income for 2010 forward. Without any further evidence having been provided by the father, I find that this is an appropriate income to have been imputed to him for 2009 and on an ongoing basis.

[76] In summary, for purposes of child support and recognizing that the father had an obligation to earn the level of income that he was capable of earning based on his education, experience and job skills, income should be imputed to the father and child support that should have been paid is as follows:

a) $392,347.00 2004 Income to determine support for 2005

b) $396,736.00 2005 Income to determine support for 2006

c) $342,000.00 Imputed Income to determine support for 2007, 2008 & 2009

d) $130,713.00 Income to determine support for 2010, 2011 & ongoing

[77] While the father might find the imputation of income at this level to be overly burdensome, I note that in 2006, there were significant monies available from the sale of the dental practice and real estate, even after paying the income tax liability of $250,000.00. The father’s evidence as to the cost to purchase the land and the construction costs of the home in Honduras was convoluted and contradictory. While I accept that such a transaction might not have been as well documented as a similar transaction in Canada, the suggestion that the cost ranged from $210,000.00 (at Questioning) to $450,000.00 (at trial) was not credible. Similarly, the request for a tracing of the sale proceeds into his bank accounts which should have been a relatively simple exercise, was seen to be overly intrusive by the father and “none of the mother’s business”. In a similar fashion, the evidence of his current spouse, Alison Groff, was less than forthright. Despite being served with a Summons to Witness to attend trial and to provide documentation as to the source of funds for the purchase of their present home in Sauble Beach, no such documentation was provided. The only logical inference that can be drawn from the refusal to provide the documents is that although the property is in Ms. Groff’s name, at least some of the funds came from the father and some of the equity (as it is free and clear of encumbrances) belongs to the father.

The Father’s Obligation to Pay Child Support for Bradley and Caitlyn

[78] Having determined the income of the father from 2004 to date, the next issue to be determined is the status of each of the children as “children of the marriage” and the appropriate child support and s. 7 expenses that should have been paid by the father.

[79] Before turning to these issues, it is necessary to review the evidence and the positions taken with regard to two additional matters namely the father’s relationship with each of the children and the children’s RESP accounts.

Father’s Relationship with Children

[80] Each of the children testified and I found them both to be credible witnesses. It was apparent that Bradley was estranged from his father and that even as of the trial he had no interest in having contact with his father.

[81] From the mother’s perspective this occurred during the child’s teenage years as a result of the father’s failure to handle this stage, when as she stated “it is a teenager’s job to drive parents crazy”. The father acknowledged there had been difficulties in their relationship but the final straw was when Bradley began stealing money and watching pornography on the computer. When the father attempted to discipline the child, he demanded to return to his mother’s home where the father assumed he would face consequences. The father testified that the mother did not discipline Bradley, did not require the child to apologize nor did she force him to return to the father’s home. It was the evidence of the mother that she did address this with Bradley by imposing a loss of privileges. However, she expected the father to deal with the relationship with Bradley directly and he chose not to do so. His failure to do so led to an estrangement with both children.

[82] What was clear and undisputed was that once Bradley ceased attending access with the father, the mother was adamant that she would not place the children in the position of being - as she referred to it - “have” and “have not” children. As a result rather than splitting up the children and allowing Caitlyn to continue with access, the mother insisted that if Bradley was not attending for access then Caitlyn could not attend. According to the father, Caitlyn was devastated and although she did still maintain contact with him by calling from school, regular access never did resume. It was also apparent that there had been contact by email between the father and Caitlyn between September 2007 and September 2009. It was evident from the emails that the father’s requests for information as to the child’s education status and financial arrangement for post-secondary education were ignored.

[83] In contrast to Bradley who appeared to remain estranged from his father, following Caitlyn’s testimony, in what can only be viewed as an attempt to remain neutral, she sat in the middle section of the public benches in the courtroom – not sitting beside either parent. However, upon hearing the closing submissions from the mother’s counsel detailing the sale of the dental practice, the income and monies available to the father and the steps taken to avoid his child support obligation, Caitlyn was once again observed to be sitting directly beside her mother.

[84] It was apparent, that contrary to the terms of the Court order, the mother has not encouraged a positive relationship between the children and their father. It was also apparent that she has not been forthcoming about providing information concerning the children and their s. 7 expenses. Nor has she been candid with the father regarding their status at school. Although her rationale for this was that the father refused to speak with her and directed her not to call him under any circumstances, it was evident that there was a simple way to communicate namely by email – as the same email address had been used by Caitlyn from 2007 to 2009, and was used by the mother to communicate information about some dental work for Caitlyn in October 2010 or through the lawyers, as had been done to adjust the child support on two earlier occasions.

[85] It was also evident that the children’s view of their father was that he had failed to provide for them financially and had made no contributions toward their post-secondary education. The evidence was clear that this was not the case, but the mother did nothing to dispel this notion. A FRO Director’s Statement of Arrears dated September 19, 2011 was filed which showed that the child support has continued to accrue at the rate of $3,758.00 per month, the amount payable for two children under the 2000 Court order, even though Bradley has not been in full-time attendance at school since August 2008 and was married in September 2008. The arrears shown as of that date were $167,736.19. The mother’s explanations for not having advised them of this change were feeble such as that it took hours to reach them by telephone; that she was not aware that FRO was still enforcing the support order; and that she never really thought about it, even though she had notified them when the spousal support obligation had ended. As noted by the father’s counsel, the mother could certainly have dealt with this through the lawyers as she had done with the previous adjustments to the child support or she could have simply sent a letter to FRO advising of the change in Bradley’s status.

Children’s RESP Accounts

[86] Under the order the mother was required to pay $300.00 per month into a registered education fund for the children. It was unclear when the payments were to commence and into which fund or funds the payments were to be made.

[87] It was the mother’s evidence that RESP accounts had been opened for both children in 1990 or 1991 with USC Education Savings Plan. She stated that the payments during the marriage were not initially $300.00 per month. After separation the payments continued to be made from the parties’ joint account but after the divorce order, it was the wife who made the payments as the father’s name had been removed from the joint bank account.

[88] The mother’s evidence in chief was that she had made the required payments with the exception of a brief two month period (November and December 2003) when she was unable to work due to a diagnosis of colon cancer. She provided documents to verify the deposits made by her from April 2002 to December 2007 onward. These confirmed monthly deposits of $300.23 from April 15, 2002 to and including October 15, 2003 and then monthly deposits of $149.63 from Nov 15, 2003 to and including December 15, 2007. The mother stated that she had been unable to obtain any records prior to that date.

[89] The mother noted that the payments for Bradley would have stopped in December 2003 as that was his Grade 12 year. Although he did not graduate from high school until June 2005, she testified that she could not make further contributions after December as the USC plan worked on a calendar year.

[90] Similarly, she noted that the payments for Caitlyn ceased in December 2007 being her grade 12 year, even though she did not graduate from high school until June 2009. No documentation from USC was provided by the mother to confirm this, but it is noted that in each case, this was the year in which each child turned 17 years of age.

[91] In cross-examination, the mother was shown a letter from USC dated January 3, 2001 confirming that the payments were in arrears for January, March, September, November and December 2000. She also confirmed that it was her handwritten note dated October 16, 2000 requesting that the payments on two of the four accounts be suspended for a two year period. She testified that this would have been during a period of time when she was very ill and she had no recollection of having done this until shown the letter. She confirmed that she had not advised the father that she had suspended the payment on these two accounts.

[92] The mother acknowledged that this was a serious matter as she was fully aware that the order required her to maintain the payments. She also acknowledged that this would have resulted in the funds in Bradley’s plan being a minimum of $1,800.00 ($75.00 x 24 months) less than expected, plus the loss of government matching and interest. She also acknowledged that at a minimum an additional $1,800.00 ($75.00 x 24 months) should have been contributed to Caitlyn’s plan, and that the failure to do so resulted in the loss of government matching and interest.

[93] The father’s evidence was that he had paid the contributions of $300 per month until the parties were divorced. Thereafter the mother was responsible for paying this out of the child support of $3,758.00 per month. He was concerned this would not get done, so a specific term had been included in the Minutes of Settlement. He testified it was his expectation that there should have been sufficient monies in the education plan to fund both children’s education expenses.

[94] Although father’s counsel suggested that the mother was taking the position that these contributions should be seen as her contribution to the children’s post-secondary education expenses that would not make sense given the terms of the order. This stipulated that if the RESP funds were not needed by one child, they could be utilized by the other child and if there was an excess, this was to be split between the children and not paid to the mother.

[95] In his testimony, Mr. McIntyre, who had represented the mother in the Divorce proceedings, could not recall whether this issue had been discussed. However, he acknowledged that if the intention had been that these would be credited to one parent as a contribution toward s. 7 expenses one would have expected such a clause to have been included.

[96] In the mother’s testimony she confirmed that the RESP funds should be deducted from the children’s education expenses and that it was only the balance of expenses that should be shared on a pro rata basis between the parties. I agree that this is the only logical conclusion that could be drawn as to the proper interpretation of the order.

[97] There was also some suggestion by the father’s counsel when cross-examining the witnesses and in his closing submissions, that once the contributions to the RESP for Bradley ended, the order required that the mother continue to contribute the amount of $300.00 per month to the RESP for Caitlyn. As the contributions were being paid from the monthly child support into existing RESP accounts for each of the children, the only logical interpretation of the order was that the payment would have been reduced by one-half to $150.00 per month once contributions could no longer be made for Bradley.

[98] It would have been helpful to have been provided with complete records of the USC plans to know the balances in each of the accounts as of the date of the order and to have documentation concerning the interest and other terms applicable to these plans, so as to be able to calculate what funds should have been in these accounts if the order had been fully complied with. No such evidence was provided by either party.

[99] The funds paid out from the Education Savings Plans to Bradley totalled $17,358.47. The funds paid out from the Education Savings Plans to Caitlyn totalled $25,646.39.

2(a) When did Bradley cease to be a “child of the marriage”?

Course Enrolment

[100] Bradley completed high school in June 2005. He was enrolled in a Chef Training program at Conestoga College in Kitchener and began attending in September 2005. Bradley testified that he quit the program after a couple of months. The mother testified that he quit the program one month and ten days into it, sometime prior to Thanksgiving. She recalled this specifically as she was quite upset about it at the time. She did not advise the father as he had made it clear that he did not want her to communicate with him, whether by email or telephone. She also indicated that as Bradley had obtained early acceptance into a Woodworking course to start in September 2006, she believed that the child support should continue.

[101] The mother testified that when Bradley returned to school in September 2006 he took a two year woodworking program and that he graduated in August 2008. She confirmed that Bradley had been reluctant to provide his transcript or other documents to verify his post-secondary education expenses until just prior to the trial.

[102] Bradley’s evidence was that he enrolled in the Woodworking Technology Co-Op program which began in September 2006 with his enrolment continuing into the Winter 2007 term. He was enrolled in the same program in the Fall 2007 and was achieving all of his credits. However, during the Winter 2008 term, he testified that he was unable to complete the Co-Op placement. His evidence about this was somewhat unclear. Initially, he indicated that he was off for 2 months due to severe acid reflux and that was the reason that he was not able to complete his co-op placement. He confirmed that he did obtain a subsequent co-op placement, but he was injured on the job and was fired. When this placement fell through, he decided to change to the two year Woodworking Technician program commencing with the Spring 2008 term, which continued until August 2008. However, as he had failed one course he did not graduate from the program until August 2010, after completing the course in the Spring 2010 term.

[103] The transcript from Conestoga College indicated that he had withdrawn from the Co-Op Work term for the Winter 2008 term. He was enrolled in the Woodworking Technician course as of Fall 2008 having transferred to the non Co-op program on August 15, 2008 and graduated after part-time studies on August 20, 2010.

Living Arrangements

[104] Bradley confirmed that in August 2005 he moved into an apartment in Kitchener with his girlfriend Rachel Brown. She did not attend Conestoga College but worked at several different jobs earning $1,200.00 to $1,300.00 per month. They continued to live together for the duration of his post-secondary studies. They were married on September 15, 2008.

[105] Bradley indicated that during this time, he and Rachel pooled their funds into a joint account from which their bills were paid. The expenses were paid equally except for the one year when they had taken in a room-mate, when the rent was split in thirds. He testified that they had a vehicle, which had been given to Rachel by her parents. The vehicle expenses, and in particular the car insurance cost was not split equally. As Bradley had been in a car accident as a young driver, his insurance premiums were in excess of $400.00 per month. He also indicated that as he was the driver with the worst driving record and he was the one who drove the car most often, he was advised to pay the higher premiums and to have the insurance in his name in an effort to get his bad driving record cleared.

[106] Bradley confirmed that in the first year, he lived within a short bus ride to the school and that the bus stop was right outside the apartment. He acknowledged that there was no co-op in the first semester of the September to December 2006 school term. However, he testified that a vehicle was a necessity to get to his part-time work and to get back and forth to his mother’s home in St Agatha which he did at least once a week to do laundry and get food/meals. He acknowledged that a vehicle was not needed as part of the course curriculum nor to attend classes, but he stated that it was needed for co-op placements.

Assistance Provided by Mother

[107] The mother testified that she paid for Bradley’s car insurance in the amount of $410.00 per month and that she also helped them financially when he and Rachel needed money to pay bills. She stated that the total amount of the payments was in excess of $14,000.00, although she did not have proof of all of these payments. There were some duplicate cheques provided which indicated a total of $10,400.00 being paid which included a $5,000.00 payment in June 2006. The bulk of the payments were made in 2005 and 2006, were payable to Rachel Brown and some appeared to be dated in 2009 and 2010.

[108] The mother also provided assistance by co-signing on the leases for Bradley’s first and second residences and by co-signing on Bradley’s Student Lines of Credit, although she has never been called upon to pay for this.

Funds Available

[109] In 2005, Bradley had received USC funds in the amount of $12,414.00. He had also earned income in the amount of $6,815.00 ($3,735.00 from working at a variety store while still living in St. Agatha) and the balance from two jobs (Sobeys and Book Store - $3,080.21). He had also received $1,000.00 from his paternal grandparents toward his book expense.

[110] Bradley testified that at some point during the time that he was not in school (November 2005 to August 2006) he had borrowed $5,000.00 from Rachel to pay his share of the living expenses. The mother confirmed that she had given Bradley $5,000.00 in June 2006 when she sold her home and that the funds were used for school. Bradley testified that the purpose of the funds was to pay down his debts. Bradley did not have any records to confirm the amount borrowed from Rachel. At one point he testified that it had been $2,000.00 and later that it was $5,000.00 and that he had also borrowed $3,000.00 from Rachel’s father. He did not provide any statements to verify the dates that this indebtedness arose, nor were there any statements provided as to the current amount of the indebtedness.

[111] Bradley testified that he did apply for OSAP and Student Grants but that he did not qualify. He was able to obtain a Student Line of Credit by having his mother co-sign for this. She testified that she has not been called upon to pay any of this and that Bradley has been responsible in paying this.

[112] In 2006 Bradley earned income of $4,411.09 and drew on the Student Line of Credit. According to the Account History, the account was opened August 18, 2006 and as of December 29, 2006 there was a balance of $7,702.45.

[113] In 2007 Bradley received USC funds of $4,943.00, had employment earnings of $3,373.00 and drew on the Student Line of Credit. According to the Account History, as of May 31, 2007 the balance owing was $8,057.72. In July 2007, there were a series of transfers to Account No. 0508500 which totalled $6,800.00 and a transfer in August 2007 of $1,000.00 leaving a balance owing of $15,883.08. There was no documentation provided to verify what these funds were used for.

[114] Subsequent entries for the account (for insurance and interest charges and modest payments) showed the balance to be $16,216.22 as of November 30, 2007, $16,300.54 as of March 31, 2008 and $15,906.62 as of March 31, 2009.

Expenses

[115] The mother confirmed that she was not involved in the day-to-day finances of Bradley and Rachel. He was able to use the Education Funds and Student Line of Credit as he decided. When he and Rachel would ask her for money, she would ask for a general accounting of what the funds were needed for, but she did not make any further enquiries about their bills.

[116] A handwritten list of expenses was prepared by Bradley for the time periods August 2005 to and including August 2008.

[117] For the first school year August 2005 to August 2006, there were total expenses of $21,197.70 broken down as follows:

Tuition /School $ 2,048.70

Rent Bus Pass Groc Rogers $10,465.00

Car Expenses $ 8,684.00 ($668 per month)

[118] For the next two years, September 2006 to August 2008 the expenses totalled $36,799.00 broken down as follows:

Transportation Expense $13,197.56 $1080.00 Re: Bus Pass Balance re: vehicle repairs, insurance, gas

Rent Expense $10,090.04 (½ or 1/3 based on location & additional roommate)

Tuition Books Computer Tools $10,050.00

Food & Phone/Internet $ 3,423.36

Position of the Parties

[119] The father’s position is that support for Bradley ended in September 2005 when he moved in with Rachel Brown and withdrew from parental control. As his counsel stated, from that point on Bradley “ran his own show” and he alone determined how his finances would be handled. Alternatively, if the common-law relationship did not terminate his obligation to pay child support, the fact that Bradley was not in school from October/November 2005 to August 2006 should mean that no child support was payable for that time period. If the support obligation did revive when Bradley returned to full-time studies in September 2006, the expenses for the vehicle should not be allowed as this was not a necessity and the father was not consulted about this expense. Further, if there are Student Lines of Credit outstanding, these should be Bradley’s responsibility as the father had student loans following his graduation from dental school.

[120] The mother’s position is that she continued to support Bradley throughout the three years (September 2005 to and including August 2008) and that he continued to be a child of the marriage for that entire time. Accordingly, child support should be payable by the father continuously until August 2008. In addition, the father should pay his pro rata share of the child’s education expenses. The father ceased paying any child support for Bradley in January 2006 and other than his indirect contribution toward the RESP accounts, he did not make any other contributions toward the post-secondary education expenses. As such it is submitted that there are substantial arrears that are owed by the father.

The Law and Analysis to the Facts

[121] The applicable statutory provisions are set out in the Divorce Act, R.S. 1985, c. 3(2nd supp.) and the federal Child Support Guidelines.

[122] Under section 15.1 of the Divorce Act child support is payable for a child in accordance with the Child Support Guidelines for as long as he or she remains a “child of the marriage”.

[123] Section 2 (1) of the Divorce Act defines a “child of the marriage” as a child...who at the material time,

a) is under the age of majority and who has not withdrawn from their charge, or

b) is the age of majority or over and under their charge but unable, by reason of illness, disability or other cause, to withdraw from their charge or to obtain the necessaries of life.

[124] Section 3(2) of the Federal Child Support Guidelines addresses children who are of the age of majority as follows:

Unless otherwise provided under the Guidelines, where a child to whom a child support order relates is of the age of majority or over, the amount of the child support order is:

a) the amount determined by applying the Guidelines as if the child were under the age of majority; or

b) if the court considers that approach to be inappropriate, the amount that it considers appropriate, having regard to the condition, means, needs, and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child.

[125] Courts have held that continuing education and emotional and financial dependence can be “other causes” that prevent a child from withdrawing from parental charge and therefore entitle the child to continue to be supported. Withdrawal from parental control is a question of fact and must be interpreted in light of all of the circumstances, including the age and maturity of the child and whether financial support has continued in support of a finding that a child remained under parental control.

[126] While the father’s counsel suggested that Bradley had withdrawn from parental control upon entering a common law relationship, I disagree. While it is true that after September 2005 Bradley did not return to live at his mother’s home, she nevertheless continued to provide emotional and financial support for him. The latter was evident by the payment of car insurance payments, co-signing on apartment leases and on student lines of credit and additional payments that she made toward his living and educational expenses.

[127] Although the relationship between Rachel and Bradley was more than simply a financial arrangement, clearly one element of it was as a cost saving measure as reflected by the fact that when they did take in another roommate, the rent was then split three ways rather than in half.

[128] I find that Bradley’s common law relationship did not mean that he had withdrawn from parental control nor would he be disentitled to child support under the Divorce Act for that reason.

[129] However, given the circumstances surrounding Bradley’s first year of post-secondary studies, it is much more difficult to find that there was either a need for support or that the father was obligated to pay child support for him for the period from September 2005 until August 2006. Although Bradley claimed that he had expenses of $21,000.00 for the first year, almost $9,000.00 of that related to vehicle expenses, for a vehicle that was clearly not needed for his education. In fact, he stated that aside from some employment it was used to get to his mother’s home to do laundry and have a meal and get food once per week. I note as well that for that time period, Bradley had income from employment and the USC funds of more than $19,000.00.

[130] Bradley quit the education program within the first two months. This was not communicated to the father by the mother. When it was finally communicated in March 2006 as a result of an inquiry from the father’s lawyer as to Bradley’s status, it was indicated by Mr. McIntyre (the mother’s lawyer) that no child support was payable for Bradley commencing in September 2005. This was clear from his calculation of the child support arrears. While I have already found that the calculation was based on inaccurate income information for the father, it would be unfair for the mother to now take a different position and be able to seek support for Bradley for that first year.

[131] I have no difficulty in finding that the obligation to pay child support was revived when the child returned to full-time studies and that the father was obligated to pay child support for Bradley from September 2006 to and including August 2008. He was enrolled and attending a college co-op program, albeit with some explained absences. Although the mother’s evidence was that he completed the program in August 2008, in fact he did not graduate until receiving one final credit in August 2010 – none of which was shared by the mother with the father. However, as he was married in September 2008, I would not extend the father’s support obligation beyond August 2008.

2(b) What amount of child support and/or section 7 expenses should have been paid by the father for Bradley?

[132] For the reasons stated above, the child support payable by the father should have been in accordance with his income from both the dental practice and RW. However, and for the reasons stated, the obligation to pay child support for Bradley terminated in September 2005, but revived when he returned to school in September 2006. At that time, Caitlyn was enrolled in high school and was living with her mother and as such table support would also have been payable for her.

[133] Although the mother claims entitlement to both table amount of child support and a pro rata contribution toward Bradley’s educational expenses, given that Bradley did not return to live with his mother after September 2005, if she were to receive both of these amounts, there would certainly be an overpayment due to a duplication for such expenses as housing and groceries. While there was general evidence provided with regard to living expenses, vehicle expenses and school related expenses for Bradley for this time period, undoubtedly there would have been additional expenses for such items as entertainment, clothing, and other incidentals. In my calculations I have assumed that Bradley’s employment income in those years would have been used toward such additional expenses.

[134] Based on the level of income that I have determined should be imputed to the father, after deducting the child support payable for one child (Caitlyn), that portion of the table child support attributable to Bradley from September to December 2006 would have been $1,775.00 per month; from January 2007 to and including December 2007 would have been $1,544.00 per month; and from January 2008 to and including August 2008 would have been $1,544.00 per month. This would result in the father’s total support obligation for Bradley for that two year time period being $37,980.00. This amount exceeds the total expenses claimed ($36,800.00) to have been paid from September 2006 to August 2008. It was conceded by the mother that the USC funds of $4,943.00 should be deducted from the post-secondary education expenses, which would then reduce them to less than $32,000.00.

[135] In the circumstances, it is not appropriate that table amount of child support be paid by the father for this time period in accordance with section 3(2)(a) of the Child Support Guidelines but rather that section 3(2)(b) be applied. After considering the condition, means and needs and other circumstances of the child and the parents and in particular, the father’s income (2005 - $396,736.00; 2006 - $342,000.00; 2007 - $342,000.00) and the mother’s income (2005 - $48,993.00; 2006 - $25,691.00; 2007 - $27,462.00) it is appropriate that the father be responsible for the majority of the s. 7 expenses claimed. As such I find that his pro rata share of these expenses to be 90%. However, given the mother’s failure to comply with the court order regarding contributions to the USC education funds which resulted in approximately $2,000.00 less being available to cover Bradley’s education expenses, the father’s contribution shall be calculated on expenses of $30,000.00 for a total contribution of $27,000.00, to be paid within 90 days.

[136] It is expected that upon the father making the required contribution toward these expenses, this will be more than sufficient to retire any student lines of credit that may have accrued during Bradley’s attendance at college. Contrary to the position taken by the father, given the means of the parents, it is not reasonable to expect Bradley to bear the burden of that amount of debt.

3(a) What amount of child support and/or section 7 expenses should have been paid by the father for Caitlyn?

Course Enrolment

[137] Caitlyn graduated high school in June 2009. In September 2009 she began attending Lambton College in Sarnia. She was enrolled in a two- year Social Service Work program.

[138] Caitlyn testified that ordinarily the course lasts four semesters, with three of the semesters involving community placements. She explained that it will take her three years to complete the program because she failed a class in third semester. She explained that she had become distracted by her involvement in a Trivia Night Team and failed to complete journals and write tests for the course. She indicated that when a student fails a course, they are required to take the next semester off. She returned in September 2011 and was in the process of repeating the third semester as the co-op placement had to be started all over. The fourth semester will be completed January to April 2012.

[139] She testified that she had secured a co-op placement for the Fall term (September – December 2010). When questioned by the court she confirmed that as she had been late in submitting a criminal records check, there was not enough time left to obtain the requisite hours to complete the co-op requirement.

[140] The mother testified that Caitlyn would take three years to complete the two year program as she had been unable to obtain a co-op placement, which was mandatory for the course completion. She indicated that despite efforts to locate a placement in Sarnia and then in Kitchener-Waterloo, by November 2010 it was apparent that she would not be able to obtain the required number of hours to graduate and it was recommended by the school personnel that she end that school term and return in the Fall of 2011.

[141] There was no documentation provided from Lambton College to verify this as the only transcript submitted was dated June 2010. In any event, it was evident that Caitlyn was neither enrolled nor attending courses after December 2010 and for the next eight months to August 2011. It was also clear that none of this was communicated to the father by either the mother or Caitlyn.

[142] As of September 2011, Caitlyn had returned to Lambton College in Sarnia to complete the third semester of the Social Work program. She confirmed that she had secured a placement at a halfway house just outside of London and that she would be attending there two days per week and attending classes three days per week. It was Caitlyn’s intention to complete the fourth and final semester of the program in the Winter term (January to April 2012).

Living Arrangements

[143] In the first year at college, Caitlyn lived in residence and returned to her mother’s home on most weekends.

[144] When the co-op placement began in the second semester (January 2010) as this took place in Kitchener –Waterloo near to the mother’s home, Caitlyn spent three days in Sarnia attending classes and spent the next four days at her mother’s home, returning to residence on Monday.

[145] In the second year at college Caitlyn rented a room in a house at a cost of $500.00 per month. For the first six weeks of the third semester she attended classes on a full-time basis. Caitlyn testified that she was only home occasionally on weekends and spent most of her time in Sarnia. When she had not been able to complete the requirements of a co-op placement, in or about December 2010 she returned to live with her mother and remained there until the end of the summer 2011.

[146] For the final year of college, Caitlyn testified that she had moved in with a female friend in St. Mary’s and that they would be sharing expenses.

Assistance Provided by Mother

[147] In the initial year, the mother testified that she provided $500.00 per month to Caitlyn to cover such personal expenses as gas, extracurricular activities, food and placement expenses. Caitlyn confirmed that her mother gave her spending money, purchased clothing and anything else that she needed. The mother paid Caitlyn’s cell phone bill. She also provided Caitlyn with a used vehicle (1996 Nissan) paying for the annual insurance and the cost of repairs, with the mechanical work being done by her current husband.

[148] In the second year, for the first four months (September to December 2010) the mother paid the rent of $500.00 per month and provided Caitlyn with spending money for food, clothing and gas of $500.00 per month. She also continued to pay for her cell phone and all other vehicle expenses. The mother testified that she had to pay an extra month of rent under the terms of the lease when Caitlyn was unable to continue with the program.

[149] In April 2011, the mother purchased a newer vehicle (2005 Mazda) at a cost of $8,766.00. The mother continues to pay for car insurance and repairs for this vehicle.

[150] In the third year, the mother stated that she has been paying $1,000.00 per month to Caitlyn and the child is responsible for paying for her rent, food, gas, cell phone and any other expenses. She expects that this will continue to be the arrangement until the spring of 2012 when Caitlyn will complete the college program.

Expenses & Funds Available

[151] In contrast to the situation with Bradley where the mother had minimal knowledge of his expenses, as it was the mother who took care of paying the bills for Caitlyn, it was the child who had very little knowledge of the cost of her post-secondary educational studies.

[152] Based on the somewhat limited evidence provided and as there were no serious disputes by the father as to the expenses claimed on behalf of Caitlyn, these appear to have been as follows:

2009 Fall / 2010 Winter $10,114.78 Tuition & Residence

$ 1,000.00 Books and Supplies

$ 2,000.00 Clothing Entertainment Personal Supplies

$ 800.00 Gas to return home

$ 5,530.00 Vehicle Insurance and Repairs

Total Expenses $19,394.78

[153] The father submitted that the total expenses were $17,740.00, but his counsel conceded that $20,000.00 per year for a child living away from home was not unreasonable.

[154] The funds that were available were $24,016.02 comprised of the USC funds in the amount of $18,242.02, Caitlyn’s earnings of $4,774.00 and $1,000.00 received from her paternal grandparents toward her education expenses.

2010 Fall $ 1,790.00 Tuition

$ 720.00 Books

$ 2,500.00 Rent (5 months paid)

$ 2,000.00 Personal Expenses (4 months)

$ 3,030.00 Car Insurance and Gas

$ 1,455.00 Other Incidental Expenses

Total Expenses $11,496.00 (The amount claimed by the mother was less than this, but in his closing submissions, the father’s counsel accepted this figure so the difference has been shown as “other incidental expenses”)

[155] The funds that were available included $7,404.37 received from the USC funds, employment income of $1,071.00 and $1,000.00 from her paternal grandparents for a total of $9,475.37.

2011 Fall $ 884.36 Tuition (part-time)

$ 350.00 Books (part-time courses so reduced cost)

$ 4,920.00 Personal and Living Expenses Includes Gas (4 mths)

$ 3,297.00 Car Insurance (April 2011- April 2012)

Total Expenses $ 8,531.36

2012 Winter $ 1,790.00 Tuition

$ 720.00 Books

$ 4,920.00 Personal and Living Expenses includes Gas

Total Expenses $ 7,430.00

[156] The personal and living expenses above were based on a handwritten budget prepared by the mother setting out the following monthly expenses totalling $1,230.00:

Cable/Internet/TV $200.00

Food $400.00

Laundry $ 50.00

Gas $480.00

Hair $ 50.00

Cell Phone $ 50.00

[157] As a result, the total third year college and living expenses were estimated to be $15,961.36. However by 2011, there were no more USC funds available. Caitlyn confirmed that she had applied for student grants and bursaries but she was not eligible for same as her parents’ incomes were too high. She did receive $1,000 from her paternal grandparents. Despite efforts to obtain employment in the eight month period that she was not attending school (January to August 2011) Caitlyn was not able to earn any income during this time.

Position of the Parties

[158] The mother submitted that the father should pay full table child support for Caitlyn as well as a pro rata contribution toward her post-secondary education expenses. On her calculations, there were substantial arrears owing regarding table child support and s. 7 expenses.

[159] It was conceded by the father’s counsel that entitlement to support for Caitlyn was not in issue and that he was obligated to pay child support continuously from September 2009 when she commenced her post-secondary education studies until April 2012 when it is anticipated that she will complete same, even though she had failed a course and was not attending school for a period of time in 2011.

[160] With regard to the s. 7 expenses, there were no serious challenges by the father as to the amount of education and living expenses for the 2009 and 2010 school terms. However, he did dispute the appropriateness of a vehicle being purchased at a cost of almost $9,000.00. He also noted that the failure of the mother to pay the full RESP contributions for Caitlyn for a two year period should be factored in to any calculation of his support obligation.

Analysis

[161] I have previously indicated that the child support payable by the father for Caitlyn in 2005 would be as calculated by Mr. McIntyre in 2006 in accordance with the Child Support Guidelines in effect at that time. Based on the income that I have imputed to the father and the changes in the table child support as of May 1, 2006, for subsequent years the child support payable for Caitlyn while she was living at her mother’s home and attending high school would have been as follows:

2005 $396,736.00 $2,934.00 per month payable in Jan.-Apr. 2006 (1997 tables)

2005 $396,736.00 $3,080.00 per month payable in May-Dec. 2006 (2006 tables)

2006 $342,000.00 $2,675.00 per month payable in 2007

2007 $342,000.00 $2,675.00 per month payable in 2008

2008 $342,000.00 $2,675.00 per month payable in 2009

[162] Caitlyn turned 18 years of age in July 2008. As such the starting point in determining the child support to be paid thereafter is section 3(2(a) of the Federal Child Support Guidelines, which presumes that child support is to be paid in accordance with the tables. However, once Caitlyn began college in September 2009 it is necessary it is appropriate to consider section 3(2)(b).

[163] Under the Child Support Guidelines and based on the father’s 2009 and 2010 income of $130,713.00 the child support payable for 2010 and 2011 would have been at $1,111.00 per month. Commencing in January 2012 and in accordance with the amended Guidelines, the child support payable would be $1,120.00 per month.

[164] In order to determine the appropriate amount of child support to be paid it is necessary to consider the circumstances of the child, which would include any income and education funds available, as well as her residential arrangements together with the nature of her studies. To determine the pro rata sharing and the means of both parents, a review of the mother’s Line 150 income and the father’s income discloses the following:

Mother Father Pro Rata Share

a) 2008 $55,275.00 $342,000.00 14/86

b) 2009 $54,600.00 $130,713.00 30/70

c) 2010 $58,445.00 $130,713.00 32/68

d) 2011 $59,000.00 $130,713.00 32/68

[165] With regard to the Fall 2009/Winter 2010 school terms, there were more than sufficient funds to cover Caitlyn’s expenses and as such there would be no contribution required from the father. As is often the case when a child lives away from home to pursue educational studies, many of the expenses covered are a duplication of the expenses included in table child support. I find that to be the case here for the Fall 2009 term and no table child support would be payable by the father. However, for the Winter 2010 term, to the extent that Caitlyn was living with her mother for four days out of each week to complete her co-op placement, it is appropriate that the sum of $400.00 per month be paid for those four months. At the end of that term and for the duration of the time that Caitlyn was once again living at her mother’s home on a full-time basis, commencing in May 2010 full table child support ($1,111.00 per month) should have been paid by the father.

[166] With regard to the second year expenses, it appears that there was a shortfall of approximately $2,000.00. As that is very close to the amount that would have been in the USC funds had the mother not suspended the payments into one of Caitlyn’s RESP’s for two years, the father shall not be required to contribute toward this shortfall. There is also no requirement for table child support to be paid for the September 2010 to December 2010 period, but table child support should have re-commenced in January 2011 and continued until August 2011.

[167] Although the mother submitted that the $9,000.00 cost of the Mazda vehicle should be included in s. 7 expenses that the father should be required to contribute to on a pro rata basis, I disagree. There was no consultation with the father regarding this substantial expenditure. It was purchased at a time when the child was not attending school nor was it needed for employment. It was neither a reasonable nor necessary expense.

[168] Finally and with regard to Caitlyn’s final school year expenses, after deducting the $1000.00 received from her grandparents, the father’s pro rata share (68%) of the $15,000.00 cost would be $10,200.00. This amount shall be paid within 90 days.

[169] There was no evidence provided by the mother to verify how often Caitlyn is returning home, what if any expenses the mother might be incurring to maintain a room or provide for Caitlyn or what other expenses are being made by the mother for Caitlyn’s benefit. Nevertheless, I accept that there would be some additional expenses for clothing, entertainment and other such incidental expenses that were not included in the monthly budget. As such I find that it is appropriate that in addition to contributing toward a pro rata share of s. 7 education expenses, the father shall also pay table child support in the amount of $200.00 per month commencing September 1, 2011 and continuing to and including April 1, 2012.

Re: Dental Expenses for Caitlyn

[170] The mother requested that the father contribute toward the cost of dental work for Caitlyn from 2005 to 2010. She testified that she had incurred an expense of $3,876.47.

[171] Ordinarily this type of expense would be considered a s. 7 expense that would be shared on a pro rata basis. However, there are two difficulties with the 2005 expenses. The mother claimed reimbursement of $2,215.20 but upon reviewing the documentation it appears that two of the 2005 statements are estimates only and the only proof of payment was a cheque for $524.31 on August 29, 2005. It was apparent that in January 2006 there were discussions between the parties’ counsel regarding adjustments to the child support and one would have expected that if the mother was seeking a contribution from the father that would have been the time to provide the receipts. The onus is on the parent claiming a s. 7 expense to provide receipts to verify the cost of same. It is certainly advisable, except in the case of an emergency, for some notice and consultation to take place. Given the delay and the lack of evidence to support the dental costs, there is no requirement that the father contribute toward the 2005 dental expenses for Caitlyn.

[172] There was a Fee Summary from Dr. Jeffery Sumner which confirms dental fees of $811.27 for Caitlyn between March 2008 and October 2010. On October 14, 2010 following dental work having been done, the mother sent an email to the father proposing that he do future dental work for Caitlyn to reduce the cost. In that email, she stated that she had spent $6,000.00 on dental work to date for Caitlyn (no receipts were provided nor was there a request for reimbursement from the father) and that there would be additional work at a cost of $2,000.00 if the father did not perform the dental work. The mother testified that she did not receive a reply to the email from the father. This had been the email address previously used by Caitlyn to communicate with her father, although it was not clear whether the mother’s email had been received. However, I am satisfied that the mother did attempt to notify the father of this expense and gave him the option of doing the dental work to reduce the cost. However, on the evidence presented it is not at all clear what the actual cost of this additional dental work has or will be. The father should contribute on a pro rata basis toward the dental expenses incurred for Caitlyn with Dr. Sumner (68% of $811.27) in the amount of $552.00. Upon the mother providing receipts for any dental work done since October 14, 2010 and for as long as Caitlyn continues to be a “child of the marriage”, it is appropriate that the father contribute on a pro rata basis and he shall be responsible for 68% of the cost of Caitlyn’s dental work.

Calculation of Arrears

[173] I wish to clarify how I have calculated the arrears of child support to March 1, 2006.

[174] In 2006 the parties through counsel agreed regarding the calculation of child support arrears for 2003, 2004 and 2005, which calculations I have accepted to be correct. This required the father to pay arrears of $9,424.81. However, the calculation then continued to deal with child support payable for 2006 and based on 2005 income of $307,900.00 (less than the income that I have determined should be imputed to the father for 2005) it was determined that the father had overpaid the child support by $982.81. As such once he made the payment of $8,341.87 (which was conceded by mother’s counsel was done) this purportedly brought the child support payments into good standing. Obviously that is no longer correct based on my determination of the father’s 2005 income. The child support that should have been paid was $8,802.00 (January, February and March 2006 at $2,934.00 per month). In January and February 2006, the father paid $7,482.40 which would leave arrears of $1,319.60 owing after the support accrual for March 1, 2006.

[175] The father did make a subsequent payment of $3,724.40 on March 2, 2006 and various payments thereafter and would be entitled to credit for any payments made through FRO commencing with the March 2, 2006 payment.

[176] I leave the calculation of arrears of table child support from April 1, 2006 onward, together with interest, to the Director of FRO. However, as far as payment of those arrears, this shall be limited to $1,000.00 per month with the payments to commence as of May 1, 2012.

Summary

[177] For the reasons set out above, the Order of Glithero J. dated July 5, 2000 shall be varied as follows:

1. The arrears of child support effective March 1, 2006 are fixed in the amount of $1,319.60, with the next payment being due on April 1, 2006.

2. The Respondent shall pay child support to the Applicant as follows:

a) On April 1, 2006, based on an income of $396,736.00, support in the amount of $2,934.00 per month.

b) Commencing May 1, 2006 and continuing to and including December 1, 2006, based on an income of $396,736.00, support in the amount of $3,080.00 per month.

c) Commencing January 1, 2007 and continuing to and including August 1, 2009, based on an income of $342,000.00, support in the amount of $2,675.00 per month.

d) Commencing January 1, 2010 and continuing to and including April 1, 2010, support in the amount of $400.00 per month.

e) Commencing May 1, 2010 and continuing to and including August 1, 2010, based on an income of $130,713.00, support in the amount of $1,111.00 per month.

f) Commencing January 1, 2011 and continuing to and including August 1, 2011, based on an income of $130,713.00, support in the amount of $1,111.00 per month.

g) Commencing September 1, 2011 and continuing to and including April 1, 2012, support in the amount of $200.00 per month.

3. The Respondent shall receive credit for any payments made through the Family Responsibility Office on account of child support since March 1, 2006.

4. The arrears of child support calculated as being owed under paragraphs 1, 2 and 3 shall be paid at the rate of $1,000.00 per month commencing May 1, 2012.

5. The Respondent shall pay to the Applicant the sum of $27,000.00 as his contribution toward the post-secondary education expenses for Bradley. The payment shall be made within 90 days.

6. The Respondent shall pay to the Applicant the sum of $10,200.00 as his contribution toward the post-secondary education expenses for Caitlyn. The payment shall be made within 90 days.

7. The Respondent shall pay to the Applicant the sum of $552.00 as his contribution toward the dental expenses for Caitlyn to and including October 14, 2010. The payment shall be made within 90 days.

8. Within 30 days, the Respondent shall provide the Applicant with all receipts for any dental work for Caitlyn since October 14, 2010. No later than 30 days thereafter, the Respondent shall pay to the Applicant his pro rata share (68%) of such expenses. The Respondent’s obligation to contribute this pro rata share of dental expenses shall continue for as long as Caitlyn continues to be a “child of the marriage”.

9. Within 30 days, the Applicant shall provide to the Respondent proof of enrolment by Caitlyn in the Social Work program for the Winter 2012 term.

10. The Applicant shall provide to the Respondent a copy of Caitlyn’s Lambton College transcripts for the Fall 2011 and Winter 2012 school terms upon receipt and shall also provide documentation confirming her graduation from the Social Work program.

11. Support Deduction Order to issue.

[178] If the issue of costs cannot be resolved, I direct that the party seeking costs to deliver written submissions to my office in St. Catharines within 15 days of the release of this judgment, with responding submissions to be delivered to my office in St. Catharines within 15 days thereafter. The written submissions are not to exceed three typewritten, double-spaced pages, excluding the Bill of Costs and Costs Outline.

MacPherson J.

Released: January 31, 2012

KITCHENER COURT FILE NO.: 30794/99

DATE: 2012/01/31

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

LEE ANNE FISHER (ROGERS)

Applicant

• and -

CHRISTOPHER MARK ROGERS

Respondent

REASONS FOR JUDGMENT

MacPherson J.

Released: January 31, 2012