ONTARIO

SUPERIOR COURT OF JUSTICE

FAMILY LAW

COURT FILE NO.: FS-11-00369732FIS
DATE: 20121213

BETWEEN:

VAHE OHANESSIAN, Applicant – and – EVA KALISZ, Respondent

Melanie Sager , Counsel for the Applicant

Harold Niman , Counsel for the Respondent

HEARD: NOVEMBER 22, 2012

ENDOrSEMENT: GREER J. :

[ 1 ] The Applicant, Vahe Ohanessian (“the Husband”), moves for an Order permitting his Motion to proceed despite its late service on the Respondent, Eva Kalisz (“the Wife”). He also moves for an Order requiring the Wife to attend at the parties’ bank, the Bank of Nova Scotia, Bloor West Village Branch, to complete an Application for a line of credit secured by either the matrimonial home located at 253 Riverside Drive, Toronto, or by the family cottage located at Fire Route 303 Jones Road, Township of McKeller, Ontario, to a maximum amount of $350,000.

[ 2 ] The Husband asks for a further Order that the Wife comply with the above Order being asked for by him, within 3 days (including weekends) of the Order being made, failing which that he be permitted to obtain such a line of credit and borrow $350,000 “…without the Wife’s involvement and “without her signature” on the loan application or any documents necessary to obtain the line of credit having a maximum allowance of $350,000 or to withdraw the funds.

[ 3 ] The Husband also asks for an Order that the Wife shall provide to the parties’ bank, the documents listed in an exhibit to his Affidavit sworn November 13, 2012. These documents are set out in an e-mail from Ms. Travers of the Bank of Nova Scotia (“the Bank”) dated November 7, 2012. These involve personal documents of the Wife’s employment, pay slips and other documents, which the Bank says is necessary, so that the Husband can “…complete a refinance on your cottage property.”

[ 4 ] He asks for an Order that he be solely responsible for all costs associated with the creation of this new line of credit. He then says that if the Wife does not agree to a new line of credit on the cottage, that he be allowed to get the line of credit in his own name.

[ 5 ] The second major head of relief requested by the Husband is that he asks for an Order that the cottage be sold , and if the Wife does not agree to this within 7 days, that he be allowed to list it for sale without the Wife’s signature.

[ 6 ] The third major head of relief in the Husband’s Notice of Motion deals with the Christmas access schedule for the children of the marriage. This issue was adjourned over to a new date to be agreed upon by the parties.

[ 7 ] The Husband, 3 days before the Motion was to be heard, serves and files an Amended Notice of Motion, dated November 19, 2012, that has an even more urgent note to it. Without notice to the Wife, the Husband (who is separated from the Wife) purchased a new home with his girlfriend, the closing of which is to take place on December 21, 2012. He is therefore desperate to have funds to close the purchase of this new home.

[ 8 ] The Husband amends his Notice to now asks that he be allowed to “encumber” either the matrimonial home or the cottage to a maximum of $350,000 and that he be “immediately” allowed to have the funds for his sole use.

[ 9 ] He goes on to ask for an Order, in the event the Wife fails to co-operate on either sale, an Order shall be made dispensing with the Wife’s consent to the encumbrance. He says that if the cottage is “not found to be a matrimonial home”, that the Court order an immediate “partition and sale of the property.” Again, he wants the Court to dispense with the Wife’s signature in this transaction.

The Husband’s request for an adjournment

[ 10 ] When the parties appeared before me on the morning of November 22, 2012, the date set for the Motion to be heard for one-half a day, the Husband’s counsel asked for an adjournment, on the grounds that she had just been served with a lengthy Factum of the Wife, which the Husband now said he needed to respond to. The adjournment was opposed by the Wife, given that she had been short-served in the first instance and that after being served on November 19, with the Amended Notice of Motion, that Wife had responded as quickly as possible.

[ 11 ] I refused the adjournment but put the Motion over to 2:30 p.m. in order to allow the Husband’s counsel time to review the Wife’s Factum. When the parties returned that afternoon, the Husband had prepared a short Affidavit in response to issues raised by the Wife, and I allowed it to be filed. The Motion then proceeded.

Some background facts

[ 12 ] The parties were married on October 10, 1998 and separated May 11, 2011. There are three children of the marriage, namely:

(a) Cameron Patrick Kalisz Ohanessian, born March 15, 2001, now 11 years old

(b) Caitlan Rose Kalisz Ohanessian, born February 6, 2003, now 9 years old

(c) Rachel Carys Kalisz Ohanessian born November 5, 2006, now 6 years old

[ 13 ] The parties have previously dealt with the issues of interim/temporary access, custody and partly, child support. The Husband’s Financial Statement was sworn June 8, 2011, and filed with the Application. It shows that his income for the 2011 year was estimated to be $137,538.12 annually. He is a lawyer operating his own practice in Oshawa. He shows the parties’ two jointly held properties with the matrimonial home valued at $1,425,000, encumbered by a mortgage of $884,000 and the cottage as $660,000 encumbered by a mortgage of $326,000. The Husband also owns two properties in Oshawa valued at $130,000 in total, both encumbered by a mortgage of $101,000.

[ 14 ] The Wife, in her Financial Statement sworn August 22, 2011, says that her income for the year is estimated to be $94,706.88. The Wife’s values and debts with respect to the parties’ joint properties are the same as the Husband’s at separation.

The Husband’s Position

[ 15 ] The Husband left the Wife and children to live with his girlfriend, Nancy Chaves. He says she is now his partner and they chose to purchase a home together under an agreement of purchase and sale dated September 19, 2011. The home is said to be close to the matrimonial home. The cost of the home is $1,392,000. The closing is to take place on December 21, 2012. The Husband provided no monies for the deposit under the Agreement of Purchase and Sale. Ms. Chavez provided $75,000.

[ 16 ] The Husband in his Affidavit sworn November 13, 2012, says that he and Ms. Chaves require an additional $350,000 to close on the sale. Ms. Chaves was supposed to come up with balance required to close on the sale but has been unable to do so. The Husband therefore says he needs to access his equity in the joint properties with his Wife for the amount required. In his mortgage application with respect to this property, the Husband told the bank his income was $235,000 for 2011 (or perhaps it was an estimate for 2012).

[ 17 ] The Husband says that the two properties jointly owned have increased in value. He says the matrimonial home is worth about $1,560,000 as noted in a recent appraisal and the cottage $1,044,000. The mortgages against the properties are slightly less than they were as of the date of separation.

[ 18 ] The Husband says it is his right to get his equity out of one of the properties so he can close on the purchase of his new home. He says the Wife should not be allowed to hold this up. He says that the Wife has not settled on one aspect of the parties’ issues between themselves.

[ 19 ] The pictures of the new home show that it can be seen from the back of the matrimonial home, through either a ravine or a slightly wooded area. The Husband says this was done so he could be close to his children. The Wife finds this to be an intrusive move.

The Wife’s position

[ 20 ] The Wife’s Affidavit was sworn by her on November 20, 2012. She says that this is the third expensive Motion the Husband has brought on in one and one-half years of separation, all of which have taken a physical and emotional toll on her. She and the children continue to occupy the matrimonial home. She says the Husband has threatened her about selling the properties, had encumbered family assess for business purposes without her knowledge before their separation, and last August he threatened to file for bankruptcy, two months after the parties separated.

[ 21 ] The Wife also says that the Husband is deliberately and intentionally being underemployed. She says he did not want to pay interim/temporary child support for the three children. Further, she says that he abandoned his law practice for 10 months after separation, when he accepted a deployment to Israel, since he is in the military reserve. He paid no child support during that period.

[ 22 ] The Wife says that she learned about the Husband’s purchase of the new home through the children who were told by him that he and Nancy would be living there with her children. Her lawyer was not informed of the purchase nor provided with any papers about it until after the children had spread the news.

[ 23 ] The Wife says that she and the Husband had just recently purchased the new matrimonial home and were in the process of completing renovations to the home when the Husband told her he was leaving. She says, that he tried in June 2011 to freeze or close their joint lines of credit without her knowledge. She says in paragraph 17, “Vahe continues to pay whatever he wishes to pay me while pressuring me to sell or encumber assets and to accede to his other demands.” This is taking place where there is no Order in place regarding child and spousal support, and no proper NFP Statement in place.

[ 24 ] The Wife refuses to acquiesce to any of the Orders that the Husband is asking the Court to make and she asks that his Motion be dismissed.

Analysis

[ 25 ] The Husband sees the Wife’s position as a “war of attrition” against him. He says that his law practice is 90% legal aid clients and that he only deals with custody and access issues in the Unified Family Court. He says that although he said that his 2010 income was $267,000, he now says that this is an aberration, since that figure was gross income. He says he is paying Guidelines child support of $2,388 per month as his 2011 income is only $130,000. This is now the third different figure he has used in this proceeding for his 2011 income. A fourth figure of $102,000 has turned up in the Husband’s Affidavit of November 22, 2012, being “my line 150” income.

[ 26 ] The Wife has concerns about the Oshawa properties. The Husband concedes that he used money from on the parties’ joint line of credit to purchase the Oshawa properties, which are now up for sale. The Husband admits that he can no longer afford to renovate them and rent them out. Nor, can he continue to pay the expenses and mortgage associated with them.

[ 27 ] The Husband says that there is no prejudice to the Wife to have him access equity in one of the properties to help with the down payment on his new home. He says that he is paying the cottage debts and the Oshawa property debts, while the Wife is paying the debts on the matrimonial home. The problem, as I see it, is that even with the Wife’s income taken into account, the parties cannot afford to pay all the expenses and mortgage payments associated with the three properties. In addition, the Husband, on an analysis of these expenses, appears to have no income left over to even carry, with the help of his partner, the expenses on the new home.

[ 28 ] Somehow, the Husband thinks that in looking at the parties’ assets and debts, his best scenario is that he owes the Wife an equalization payment of about $70,000 and in the Wife’s best scenario, he owes her about $155,000. He therefore says if all the assets are liquidated, he can carry the mortgage and expenses on the new home. What he fails to take into account is the fact that the two matrimonial homes are jointly owned by him with the Wife. She has no legal obligation to do anything with the properties at this point in time. She says that any further encumbrance on these properties would be to her detriment.

[ 29 ] The Wife has delivered a “draft without prejudice net family property statement”, she says because there remain the outstanding issues concerning the parties’ financial situation, the valuation of their pensions and the issue of the debts the Husband incurred shortly before the parties separated and the support claims still outstanding.

[ 30 ] The Husband agrees that the cottage is a matrimonial home. He relies on case law that says a matrimonial home may be sold prior to Trial in cases where such an action would be appropriate. The parties’ Trial date is set for March 25, 2013 and he sees the Wife as simply holding the cottage as “hostage” so he cannot access his equity in it.

[ 31 ] The Husband says that the Wife is unreasonably withholding her consent to sell the cottage, pursuant to S.23(b)(iii) of the Family Law Act , R.S.O. 1990, c. F.3, as amended. He relies on the wording of subparagraph (b), which allows the Court to “authorize the disposition or encumbrance of the matrimonial home if the court finds that the spouse whose consent is required”, is being unreasonably withheld.

[ 32 ] The Husband, in his November 22, 2012 Affidavit, sets out many examples of where he says the Wife has been unreasonable during this litigation, including what happened at the parties’ mediation. What he fails to see, however, is that she is forced to take this position due to his erratic behaviour in bringing on expensive Motions, when neither of them can afford to litigate in this manner. He fails to see that he left the Wife in an extremely difficult position by walking out in the middle of renovations about 8 months after they purchased this expensive house, which became their matrimonial home, while they still had considerable debt attached to the cottage.

[ 33 ] The Wife says she will be prejudiced if the Court orders the sale of the cottage or forces her to encumber their joint interest in the properties before the issues of spousal support, child support and retroactive support have been dealt with. She believes she is also entitled to compensatory support.

[ 34 ] The Wife says that her parents have supported the parties throughout the marriage with child care responsibilities while the parties worked. She says that her parents are owed about $120,000 for debts owed by her and her Husband, including a $50,000 advance for the purchase of the cottage. She says that the Husband is simply ignoring this fact.

[ 35 ] The Wife does not accept the Husband’s statement that Ms. Chaves could not raise the money to complete her half of the down payment on the house. The Wife has obtained evidence that Ms. Chaves sold her condominium contemporaneously with the purchase of new home in September, for a sale price of $305,000. It may, however, be that there was a mortgage on that property that had to be paid off on the sale.

[ 36 ] The Wife says that the Husband entered into this new purchase in a financially reckless manner, without taking into account his other financial obligations. She says that the Husband managed their financial affairs because he was a lawyer and that he got them into joint debts with the line of credit, which she does not understand.

[ 37 ] The Wife and children like using the cottage property. They have family and friends in the area. The Wife wishes to preserve her right to decide if she wants to keep one of the properties through equalization. In Stafford v. Rebane , [2004] O.J. No. 4229 (Ont. S.C.J.) , Mr. Justice Tulloch refused a wife’s Motion to sell the matrimonial home, which the husband wanted to be kept for their son to live in with him while he finished high school. Even if the Court were to order the sale of it now, it is the wrong time of the year to list a cottage property.

[ 38 ] The Wife says that the Husband’s reading of S.23(b)(iii) is wrong at law. Since the parties are joint owners of the properties, the Court cannot force her to do something that would prejudice her equity. No matter which scenario one looks at, either in the Husband’s original Notice of Motion or in his Amended one, the Wife’s equity would be watered down and she would remain equally responsible on the newly encumbered debt.

[ 39 ] The Court has no power to force a joint owner to re-mortgage an interest in land. It is her position that Sections 21 and 23 of the FLA can only be invoked so as to limit or cancel the right of possession of a non-consenting spouse in the matrimonial home. The Wife says that these sections cannot be interpreted so as to defeat her legal or equitable estate in a matrimonial home. See: Henry v. Cymbalisty (1986), 61 L.W. 612-013 (Ont. U.F.C.) at p.1.

[ 40 ] The Husband asks the Court to apply the provisions of the Partition Act, R.S.O. 1990, c. P.4, to force the sale of the cottage property or the Toronto home under s.2 of that Act, so that he can purchase his new home. The law is clear that the Court does not have the jurisdiction to do this. The property is jointly owned. In Silva v. Silva , 1990 6718 (ON CA) , [1990] O.J. No. 2183 (C.A.), at para. 23 , the Court said:

…where substantial rights in relation to jointly owned property are likely to be jeopardized by an order for partition and sale, an application under the Partition Act should be deferred until the matter is decided under the F.L.A. Putting it more broadly, an application under s.2 should not proceed where it can be shown that it would prejudice the right of either spouse under the F.L.A.

The Silva case is still good law. It was followed by Martin v. Martin , 1992 7402 (ON CA) , [1992] O.J. No. 656 (C.A.), which also dealt with matrimonial property that was jointly owned.

[ 41 ] The law respecting how jointly owned properties are dealt with is different from the case where the property is a matrimonial home, which is owned solely by one spouse and the owner wants to sell the property but is being opposed by the occupant spouse. Even in that case, the Court looks at the facts of each case and can still not grant the sale. No matter which scenario one examines in this case, the Wife’s interest would be financially affected.

[ 42 ] The Court has no power to force the Wife to further encumber either property held jointly by the parties. Whichever way one looks at it, the Wife’s share of the debt increases, in the face of the Husband having said in August 2011 that he was going to declare bankruptcy. If that did take place, the Wife would be left solely responsible for the Line of Credit. Further, to make an assignment in bankruptcy, requires the assignor to list all assets and liabilities and sources of income, exactly what the Husband has had to do for NFP purposes.

Conclusion

[ 43 ] The Husband’s Motion and Amended Motion are both dismissed, with the exception of the Christmas access issue, which was adjourned by me. I have set out in detail why none of scenarios the Husband asked the Court to consider, cannot be granted in the circumstances of this case. The issue of the sale of one or both of the matrimonial properties is left to the Trial Judge unless the parties can otherwise agree in writing.

Costs

[ 44 ] Since the Wife was totally successful in having all aspects of the Husband’s Motion and Amended Motion dismissed, she is entitled to her Costs under the Rules. I will receive brief written submissions by the parties on Costs, unless they can otherwise agree on them. The submissions shall be no more than 3 pages in length plus time dockets and any case law relied upon. They shall be sent to me within 30 days of this Order and the Husband shall have 10 days after they are served on him to respond. If the Wife wishes to Reply, she will have 5 days after that to do so. All submissions shall be sent to me at Osgoode Hall.

Greer J.

Released: December 13, 2012

COURT FILE NO.: FS-11-00369732FIS
DATE: 20121213

ONTARIO SUPERIOR COURT OF JUSTICE FAMILY LAW

BETWEEN:

VAHE OHANESSIAN, Applicant – and – EVA KALISZ, Respondent

ENDORSEMENT

Greer J.

Released: December 13, 2012