Hay v. Hay, 2013 ONSC 3078

CITATION: Hay v. Hay, 2013 ONSC 3078

COURT FILE NO.: FC-03-2432-3

DATE: 2013/05/27

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: JOANNE ELIZABETH HAY, Applicant

AND

IAN JOHNSTON HAY, Respondent

BEFORE: M. Linhares de Sousa J.

COUNSEL: Mélanie Roy, counsel for the Applicant

Ron Paritzky, counsel for the Respondent

HEARD: May 13, 2013

ENDORSEMENT

[1] There are two motions to change brought by the parties before the Court. From these two motions a number of issues are put before the Court for determination as identified below.

[2] The parties were married in July of 1982 and separated in April of 2003. There are two children of their union namely, Victoria Ann Hay, born April 19, 1989, and Joanna Johnston Hay, born May 28, 1991. At the parties’ separation both children resided with the Applicant, Ms. Hay, for a time and the Respondent, Mr. Hay, was obligated to pay child support for both his children. Subsequently, one of the daughters resided with Ms. Hay, Joanna, and the other, Victoria, with the Respondent, Mr. Hay. The parties then dealt with child support by way of a set-off approach.

[3] It was agreed that both these children are now independent and no longer entitled to support. When each child become independent for the purpose of child support is one of the issues before the Court.

[4] In July of 2003, a few months after their separation the parties entered into a Separation Agreement by which, with legal advice, the parties dealt with all of the issues between them arising from their marriage and its breakdown. The Separation Agreement dealt with property division, including pensions and provided for spousal support (indexed) and child support.

[5] At the time the Separation Agreement was entered into, Ms. Hay was unemployed, and had nil income and Mr. Hay was earning $131,762.60. A clause in the Separation Agreement provided for bi-annual reviews of the spousal support with Ms. Hay being obligated to “provide information on her attempts to retrain or to obtain employment. Spousal support shall be adjusted to reflect any change in the wife’s financial position.”(Clause 8 (i)).

[6] The Separation Agreement also included a “material change of circumstances” clause permitting either one of them to seek a variation of the spousal support paid. It ended: “When the husband ceases to be employed he will be deemed to have experienced a material change in circumstances.” (Clause 8(f)).

[7] Two years after the Separation Agreement was entered into, Ms. Hay brought legal proceedings seeking a varied amount of spousal support based on the Spousal Support Advisory Guidelines as well as payment of an amount of spousal support by which Mr. Hay benefited because of the financial investment instrument chosen for by Ms. Hay for her share of Mr. Hay’s pension. An argument she again makes on this motion.

[8] At that time Mr. Hay’s income was approximately $155,000 per year and Ms. Hay remained unemployed with nil employment income.

[9] The matter was heard by Mackinnon J. and her detailed reasons, dated October 13, 2006, are found in tab 8 c of volume 2 of the continuing record.

[10] For the reasons given, Mackinnon J. found that Ms. Hay’s request to have her spousal support varied in accordance with the Spousal Support Advisory Guidelines improper and not legally sound. She also considered and rejected Ms. Hay’s claim for a retroactive amount of spousal support based on her argument that Mr. Hay benefited in the amount of spousal support he was obligated to pay because of the financial investment instrument chosen by Ms. Hay for her share of Mr. Hay’s pension. She did grant Ms. Hay a time limited increase in her spousal support to allow her “to hold the fort” (p. 33 of the Decision of Mackinnon J. dated October 13, 2006) until she sells the house which she was supposed to have done by that time and had not. Mackinnon J. also found at that time, that Ms. Hay’s efforts to find employment wanting not such as to justify an increase in spousal support.

[11] Justice Mackinnon also recognized that pursuant to the parties’ Separation Agreement the next review of spousal support was to be in January of 2008 at which time Ms. Hay was to detail all of her efforts to obtain employment. It was not disputed that neither party moved to have a review in January in 2008. It was only when Mr. Hay brought these proceedings to vary his spousal support obligations based on his recent unemployment that the parties came before the Court again seeking the relief outlined in their court documents.

[12] In October of 2012, Mr. Hay received a termination notice from his employer. It was not disputed by Ms. Hay that Mr. Hay has lost his job. For the year 2012, including his regular pay, accumulated vacation pay and his severance pay Mr. Hay’s income was $159,721.48.

[13] Upon losing his job Mr. Hay established a corporation, Hay Profession Services Inc. Through this company he was able to get a one-time contract from his former employer which he estimates will net him $8,000 for the year 2013. He continues to look for new employment but without success.

[14] In 2013, Mr. Hay began receiving Employment Insurance from which he nets (with his military pension being deducted) approximately $1,115 per month.

[15] Despite his new financial circumstances Mr. Hay has continued to pay Ms. Hay the full amount of spousal support ordered under the Separation Agreement including the indexing in the amount of $1,529.44 per month.

[16] The evidence showed that shortly after the hearing before Mackinnon J. in 2006, Ms. Hay found employment. In 2011, she earned $50,000 from employment. In addition she withdrew $15,000 from an RRSP to satisfy a debt to Canada Revenue. There was no disclosure of her 2012 income.

[17] Mr. Hay now seeks to terminate spousal support in view of the parties’ changed financial circumstances.

[18] Ms. Hay contests Mr. Hay’s motion. She seeks that spousal support be increased in accordance with the Spousal Support Advisory Guidelines and that she be awarded retroactive spousal support for the reasons argued by her counsel and mentioned earlier. Alternatively, I assume, she also requests that spousal support not be terminated but suspended until Mr. Hay is once again employed.

[19] Ms. Hay also seeks retroactive child support for the support of Joanna for one month, January, 2012, and a return of child support paid by her for Victoria who she claims was not in school after some time in 2009. Ms. Hay provided no explanation as to why she waited so long to make this claim regarding her daughter Victoria.

[20] With respect to the question of any outstanding child support, on the evidence I am satisfied that Victoria was a dependent pursuing her education and entitled to child support until April, 2012. Ms. Hay terminated her child support for Victoria in December of 2011. Strictly speaking she owes Mr. Hay four months of child support for Victoria. Mr. Hay is not seeking that this be paid to him.

[21] On the other hand, with respect to the child Joanna, there is some doubt on the evidence as to whether Joanna had withdrawn from her mother’s care and was pursuing in a serious way her education in the summer, fall and winter of 2011. There is evidence that she resided with her boyfriend and not being diligent in her school work.

[22] Mr. Hay ceased paying support for Joanna in December of 2011. Ms. Hay takes the position that Joanna remained in school and in her care until January of 2012 and seeks the child support payment for January, 2012.

[23] I find as a fact that Joanna ceased her education in December of 2011 by dropping out of her course. I cannot find that Ms. Hay is entitled to child support for the child Joanna for the month of January, 2012. Even if this child support were to be found to be owing and it is not, Ms. Hay’s unilateral and early termination of her obligation to pay child support for the child Victoria by four months more than compensates for it.

[24] With respect to Ms. Hay’s claim for retroactive spousal support and having read the reasons of Mackinnon J., dated October 13, 2006, I agree with counsel for Mr. Hay that the issues raised regarding spousal support being increased in accordance with the Spousal Support Advisory Guidelines and a retroactive amount be paid for the financial benefit received by Mr. Hay because of how she invested her pension fund are improperly raised on this motion, having already been argued before and refused by Mackinnon J. in 2006.

[25] With respect to the question of ongoing spousal support, I am persuaded that Mr. Hay’s motion has merit and ought to be granted. His current unemployment is not contested and is a material change in circumstances as provided for in the Separation Agreement. There is no allegation that there has been any bad faith on the part of Mr. Hay. He has faithfully paid all of his spousal support obligations to date. His search for new work is bona fide and there is no basis, on the evidence to impute any income to him other than what he has disclosed, as argued by Ms. Hay.

[26] Along with this material change in circumstances, there has also been a very beneficial material change in Ms. Hay’s circumstances, namely her employment, which she has had while receiving the existing spousal support unchanged, since approximately the end of 2006. As was expected of her she has not yet sold her house, which sale should provide her with additional funds.

[27] For these reasons I order that spousal support be terminated immediately. While there may be some justification for the termination of spousal support effective January 1, 2013, I consider terminating spousal support only upon the release of this endorsement. Ms. Hay should not find herself in a situation of paying back any spousal support already received. It should be considered as an additional lump sum spousal support of approximately six months awarded to Ms. Hay. Thereafter, Mr. Hay’s obligation to pay spousal support to Ms. Hay is definitively ended.

[28] In view of the termination of all child support and spousal support obligations, Mr. Hay’s obligation to carry insurance in the required amount to secure the support obligations is also terminated.

[29] The last issue is the question of costs. I invite the parties to try and resolve this issue between them. If this is not possible, then Mr. Hay shall have two weeks from the date of this endorsement to serve and file his written submissions on costs. Ms. Hay shall then have two weeks from that date to serve and file her written submissions on costs. Mr. Hay shall then, if he so chooses, have one week from that date to serve and file his reply to Ms. Hay’s costs submissions.

M. Linhares de Sousa J.

Released: May 27, 2013

CITATION: Hay v. Hay, 2013 ONSC 3078

ONTARIO

SUPERIOR COURT OF JUSTICE

RE: JOANNE ELIZABETH HAY

Applicant

AND

IAN JOHNSTON HAY

Respondent

BEFORE: M. Linhares de Sousa J.

COUNSEL: Mélanie Roy, counsel for the Applicant

Ron Paritzky, counsel for the Respondent

ENDORSEMENT

M. Linhares de Sousa J.

Released: May 27, 2013