COURT FILE NO.: FS-11-0004-00
DATE: 2013-07-11
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
James Danielson
Ms. S. Filipovic, for the Applicant
Applicant
- and -
Constance Danielson
Self Represented as the Respondent
Respondent
HEARD: June 6, 7 and 19, 2013,
at Thunder Bay, Ontario
Regional Senior Justice H.M. Pierce
Reasons For Judgment
Introduction
[1] The parties were married in 1996 and separated on September 17, 2010. They are the parents of two children, Christine Danielson, born January 16, 1997, and Kristopher Alexander Danielson, born June 7, 1998.
[2] The divorce was proven and a divorce judgment was granted at the conclusion of trial with the remaining issues reserved. No property division was claimed at trial.
[3] At the start of trial, the parties announced that they had agreed to a regime of shared custody, whereby the children would spend equal time in the care of each parent. A separate order has been issued in respect of the children’s custody. The father makes the remaining claims:
- on-going child support;
- s. 7 expenses;
- coverage for the children under the mother’s medical plan;
- a mutual order that the children be the beneficiaries of each parent’s life insurance and pension plan available through employment, with each parent to be named as the children’s trustee.
[4] Ms. Danielson made an oral motion at the start of trial to claim spousal support. After hearing submissions, over the objections of the father, she was given leave to amend her pleadings to claim spousal support on condition that she served and filed a notice of motion to amend her answer, which she did. The mother now claims for
- retroactive and current spousal support;
- retroactive and current child support; and
- retroactive and current s. 7 expenses.
[5] The mother agrees to name the children as beneficiaries under her pension and life insurance plans at work, in keeping with the father’s proposal that this be a mutual order; however, she disputes that the father should be the children’s trustee. Instead, she asks that her cousin, Cathy Rogers, be named as the children’s trustee.
[6] No other issues were advanced at trial.
[7] The pivotal issue in this case is whether the mother is entitled to spousal support, together with a determination of her income from the date of separation forward. Secondary to that is a finding of the father’s income. Claims for child support will flow from those findings.
Spousal Support
[8] The parties met when they were at university in 1994. Both are status Indians, as defined in the Indian Act, R.S.C. 1985, c.I-5. Their children are also registered as status Indians through the mother’s band, Fort William First Nation. The family’s status is significant financially for several reasons: the father has been able to earn some of his income free of tax; the mother and children have access to funds from their band; all members of the family have health coverage available as a result of their Indian status.
[9] When the parties learned in May, 1996, that the mother was pregnant, they decided that because teaching offered stable work, the mother would complete her teaching degree. The father took a leave from his studies to obtain employment in order to support the family. He returned to his studies and graduated with a diploma in civil engineering in 1997. Despite his aspirations to obtain an engineering degree or to attend law school, he has not seen his way clear to do that in light of family obligations.
[10] The parties married in the fall of 1996. The mother graduated with a Bachelor of Arts from Lakehead University in 1998 and a Bachelor of Education, also from Lakehead, in 1999. She received a certificate of qualification and registration from the Ontario College of Teachers in May, 2000 and again in January, 2004. She took the new teacher induction program in 2007. During the marriage, she attained additional qualifications which include basic qualifications in primary and junior divisions (May, 2000); basic technological studies, personal services, a 3-week program at Queen’s University (August, 2007); cooperative education, part 1 (June, 2010); cooperative education, part 2 (July, 2010); and cooperative education specialist (November, 2012). She continues in good standing with the Ontario College of Teachers.
[11] The father testified that he helped the mother with her studies by typing and formatting her essays, assisting her in managing the computer, and with research. I accept his evidence in this regard. The mother testified that she had no curriculum vitae but the father produced a statement of the mother’s teaching credentials that he prepared for the mother, which he located on his computer.
[12] The mother has specialized training in hairdressing and aesthetics. She testified that she has been a hairdresser for 25 years and an aesthetician for 15 years. The father testified that the mother took weekend certificates in hairdressing and aesthetics and in 2001, she took a week-long course in Toronto in advanced aesthetics. He stated that this course was paid for out of family funds. He also stated that the mother took a diploma in cosmetics from Confederation College in 2001 – 2002. The mother did not challenge his testimony.
[13] In the fall of 2003, the father testified that the mother enrolled as a full-time student in the Indigenous Learning program at Lakehead University. I accept the mother’s evidence that she did not graduate from this program.
[14] The cost of the Danielsons’ education has been largely underwritten by their respective bands.
[15] The father testified that before the mother began teaching, she undertook leadership roles in a volunteer capacity at the children’s school, which included parent councils and related work on evenings and weekends. She received awards and recognition for her leadership. The father added that he encouraged her to network. He stated that while the mother was studying, she assisted at his engineering firm, probably between 2000 – 2004, in order to supplement the family’s income.
[16] In 2004, the wife obtained an appointment as a long-term occasional teacher teaching hairdressing with the Lakehead Board of Education. By 2005, the father stated she was employed full-time with the Board and continued into 2006. In fact, the documentary evidence (exhibit 49) shows Ms. Danielson was taken on as a permanent hire on September 5, 2006.
[17] The father stated that in the summer of 2007, the mother was offered full-time work with the Board provided she obtained her accreditation. This she did at a summer course at Queen’s University, noted above. She continued to work full-time for the Board to and including in 2010. Her teaching career demanded extra-curricular work after school and in the evenings. The husband testified that he assumed child care at these times and when the mother continued her education.
[18] The mother’s income, as evidenced by her T-4 slips, is as follows:
- 2010: $63,664.36
- 2011: $68,734.66
- 2012: $53,441.39 (including supply teaching)
[19] The mother was evasive when questioned about her potential earnings for the coming year. Her financial statement sworn June 5, 2013, deposes that she will have annual income of $24, 142. Unfortunately, she was not candid about what her income would be. She stated she was low on the seniority list and needed several more credits to make her more competitive. Ms. Danielson testified that she has been offered 5/6 course load for the coming term but she could not confirm this as it was not in writing. She purported not to understand the salary grid or know the importance of the seniority line in her collective agreement. She testified that when she went to school in September, she looked at her cheque stub to see what she would be paid. None of these answers are credible.
[20] When pressed in cross-examination, she suggested that her income would be $60,000 for the coming year.
[21] Exhibit 49 is a letter dated January 15, 2013, from the Board’s Human Resources officer, produced by the mother. It confirms that Ms. Danielson moves up the salary grid from year 6 to year 7 as of January 31. From the date of the letter, I conclude the author means January 31, 2013. Despite exhibit 49, the mother disputed that she moved up the salary grid from year 6 to year 7, claiming there was a salary freeze.
[22] When cross-examined about the collective agreement, she agreed that she was currently above the seniority line. She also agreed that her income would be 5/6 of the prescribed salary in the grid, based on seven years’ experience. She agreed that she could take on supply teaching assignments for the remaining time and is qualified to teach co-op programs. She also agreed that because she has elementary school qualifications, she could “bump” a full-time elementary teacher and take his or her spot, but she has not investigated the possibility of transferring to the elementary panel.
[23] I find that under the terms of the collective agreement for September 1, 2008 – August 31, 2012, and the letter produced by the mother, she will move up the grid, placing her as a category three teacher in the wage grid. Annual earnings for a category three teacher according to the wage grid are $74,912. She agreed in cross-examination that based on her current course assignment, she can earn 5/6 x $74,912 or $62,426.66 in the 2013 – 2014 teaching year. This is before considering income from supply teaching or other assignments. It is evident that her salary will increase with her seniority.
[24] The mother testified that she helped the father with his career by helping him study when he was at university and by staying home with the children. She testified that the father worked in Kenora for long periods of time leaving her solely responsible for child care. The father disputed this, saying that he worked out of a home office in Thunder Bay, even though his employer had its offices in Kenora. He testified that his work required him to travel to Kenora five days per month. He added that the parents were equally involved in child care, assisted by their families.
[25] I conclude that the mother’s testimony about her assistance to the father’s career is exaggerated. The parties agreed that their respective families assisted them with child care on a consistent basis. The maternal grandmother even moved in with the family to help. During some periods of time, the children attended day care for socialization purposes; as well, they went to their neighbor’s home for after-school care when they were younger. Receipts in evidence confirm this.
[26] When the children were old enough, they went to day camps during summer vacation. The mother is not required to work for the summer school vacation; the father has ten weeks of vacation. Mr. Danielson candidly said that the family ate out a lot when they all lived together. At times, he cooked. He testified that he did most of the grocery shopping and that household tasks were shared in the early years. He added that they hired a cleaner later on.
[27] When reviewing the father’s income, it is important to distinguish between income earned on a reserve which is not taxable and income which is subject to tax. For example, in 2010, the father’s notice of assessment shows taxable income from his employment at Central Mortgage and Housing Corporation (“CMHC”) of $30,115. However, the father also earned $60,673.11 from non-taxable employment in 2010. In 2011, his income was $84,496.30 exclusively from CMHC, all of which was taxable. The father estimates his income for 2013 will be $95,550. His financial statement sworn May 30, 2013, declares current income of $99,624.96. The mother does not challenge the father’s current income estimate.
[28] It is clear that the parties were living beyond their means in the lead-up to separation in 2010. They lost their home to foreclosure in June, 2011. The family finances were a house of cards thereafter.
[29] The father was not able to make an assignment in bankruptcy as he was advised it would adversely affect his employment at CMHC where he worked since 2010. Consequently, he filed a bankruptcy proposal in October, 2011, which requires him to make payments of $700 per month for 60 months on account of the family’s debts. These payments are on-going. The mother made an assignment in bankruptcy in August, 2012, and so is relieved of the burden of debt.
[30] In her evidence in-chief, the mother neglected to mention that she received a land claims award from her band in 2011 in the amount of $36,200. When asked what she did with it, she replied, “spent it.”
[31] As noted, the mother claimed in her financial statement sworn June 5, 2013, that her current income is $24,142.32, a figure that is patently unreasonable. She declares annual expenses of $61,921.80. These include a housing expense of $1,000 per month. The mother reluctantly admitted in cross-examination that she lived in her cousin’s home with the children. When asked, she could not produce receipts for rent; there is no tax information demonstrating that she pays rent.
[32] I conclude from the mother’s failure to apply for benefits available to the children from the Fort William First Nation, and her lapse in claiming dental coverage of $158 from her band, that she is not concerned about the adequacy of her income. She received child support from the father of $187 per month from September, 2011, until it was increased to $222 per month effective March 1, 2012, both figures based on shared custody. Child support payments are not shown on the mother’s financial statement.
[33] The father’s financial statement, sworn May 30, 2013, shows current annual income of $99,624.96 and annual expenses of $122,982.
[34] Is the mother entitled to spousal support? I conclude that she is not, either on the grounds of need or because she has been financially disadvantaged by roles adopted during marriage. Her financial statement shows income adequate to her needs, bearing in mind that the children are in her care in alternating weeks.
[35] Prior to marriage, the mother wanted to be a teacher. Marriage gave her an opportunity to study and advance and achieve that goal without limitation. She is financially better off as a result of the marriage, which has given her an opportunity to improve her academic and trade credentials, obtain permanent employment and attain seniority teaching. She is entitled to a pension, health insurance, life insurance, and other benefits of quality employment. She is on permanent staff at the Lakehead Board of Education. The father has shouldered his share of the child care and will do so in future.
[36] The mother’s claim for spousal support, including retroactive spousal support, is dismissed.
Retroactive Child Support
[37] The father does not seek retroactive child support. The mother claims retroactive child support and s. 7 expenses from September, 2010. These claims are dismissed for the following reasons.
[38] Following separation, the parties lived together in the matrimonial home until November, 2010. At that time, the mother lodged a complaint with the police that led to the father’s arrest. Until the matter was resolved, the father was required to leave the home and to have no contact with the mother.
[39] From the point of separation until the parties lost the home in June, 2011, the expenses for the home were paid out of the parties’ joint account to which the father was the sole contributor. The mother insisted that since expenses were paid out of joint account, she also contributed to their payment. This argument strains credulity. The mother also claimed that she paid cash to the father upon his demand for household expenses. There is no proof of such payments. Upon his arrest, the father was subject to an undertaking that he not have contact with the mother, so I find her account of giving him cash unlikely, particularly after his arrest in November, 2011.
[40] The mother retained experienced counsel in connection with her separation. The father was initially unrepresented. He testified that he was not called upon to pay child support following separation because he was already paying the costs of the home. I find this explanation probable. As noted above, the father still pays $700 per month to retire matrimonial debt, in accordance with his bankruptcy proposal.
[41] As of the summer of 2011, the children were in the equal care of their parents. At the request of counsel for the mother, the father began paying child support of $187 per month from September, 2011, based on shared care until support was increased to $222 per month effective March 1, 2012. The latter payment was formalized by court order. There are no arrears of support.
[42] The trial judge has jurisdiction to re-visit interim orders in appropriate cases. In this case, before child support was court-ordered, the agreement represented an executory contract between the parties, which the father has honoured. It does not behoove the wife to refute that contract. There is no suggestion that the father misrepresented his income at the time of the agreement.
[43] To order the father to pay retroactive child support now would reward the mother with double recovery despite the parties’ agreement. It would discourage parents from making informal support agreements for fear that they may be subject to further demands for support at trial. I find that the agreement of the parties took into account the financial obligations the father had assumed on account of the family. I conclude it was satisfactory to the mother and her counsel at the time and should not be re-visited now. The claim for retroactive child support is dismissed.
Retroactive s. 7 Expenses
[44] The mother also claims for retroactive s. 7 expenses. She filed a summary of those expenses from 2010 - 2012 as part of exhibit 34. The total amount is $2,252.99. The expenses begin on September 8, 2010, and continue through to December 12, 2012. Supporting receipts were also filed.
[45] The gymnastics registration dated September 8, 2010, in the amount of $455.70 is the highest expense. It was paid prior to separation on September 17, 2010, and cannot be considered as a s. 7 expense. The next highest expense is a cheerleading trip at a cost of $300 paid by the mother in February, 2012. The father produced a receipt dated April 13, 2012, in the amount of $300 for a cheerleading trip. There is no evidence whether this relates to a single trip or represents two trips. In my view, the expenses off-set each other when retroactive claims are considered.
[46] The mother claims a dental expense dated September 13, 2011, in the amount of $158.93. The father testified that, as status Indians, the entire family has excellent medical coverage before resort is had to the parents’ respective medical plans. I conclude that the mother simply did not submit this claim to her band for reimbursement. It should not, therefore, be considered as a s. 7 expense, as other coverage is available.
[47] The balance of the mother’s claims for s. 7 expenses relate to the children’s recreational pursuits. Only one is more than $200 (Petrie’s Cycle, $209.79); the rest are $175 or less. Most are nominal amounts. The amounts claimed for 2012 do not exceed $1,000. In my view, these claims are not extraordinary in relation to the mother’s income and in particular considering they accrued over 2 ¼ years.
[48] The father’s records show that in 2012, he also paid for extra-curricular expenses for the children. His contribution, at about $1,200 for recreational expenses, exceeds the mother’s contribution for 2012 by a few hundred dollars. Given that he is the higher wage earner, this is appropriate.
[49] The father also paid for Christine’s orthodontic treatment beginning in December, 2012. The first payment was $70; he continues to pay for this treatment. The mother admits she has made no contribution to this care.
[50] With respect to retroactive s. 7 expenses, the father’s evidence is that he paid these expenses before the matter came to court on June 14, 2012. Given the modest amounts that the mother claimed between 2010 – 2012, the receipts tendered by the father, and the activity level the children engaged in over that time, I accept the father’s evidence that he also paid the children’s extracurricular expenses.
[51] The mother’s claim for retroactive s. 7 expenses is dismissed.
Current Child Support and s. 7 Expenses
[52] Both parents claim orders for child support. I find the husband’s income for 2013 is likely to be $99,624. The wife’s income is likely to be approximately $65,000 when her regular course income plus supply teaching or other assignments are factored in. The father’s income constitutes 61% of the parties’ combined incomes; the mother’s, 39%.
[53] The father has filed detailed budgets setting out the children’s expenses. He claims that the cost of maintaining the children for 2012 was approximately $35,000. While I accept that he has an increased cost to share custody, I conclude that the mother must also have an increased cost of shared custody. It would require a forensic accountant to determine the implications of each parent’s additional costs. There is no such evidence before the court. I conclude, therefore, that the increased cost to each parent of sharing custody is equal in view of the fact that the children share time equally with their parents.
[54] There is no evidence of conditions, means and needs or other circumstances of either parent or child as provided in s. 9 of the Child Support Guidelines that are relevant to the assessment of support. Therefore, I find that a simple off-set of each parent’s liability for child support is appropriate in this case.
[55] When each parent’s liability for child support is offset, the father will owe the mother child support of $1,412 per month and the mother will owe the father $968 per month. The difference between these two figures is $444 per month.
[56] The father submits that in view of the mother’s failure to pay her pro rata share of the s. 7 expenses ordered by the court, he has over-paid his child support obligation. He suggests therefore that there should be no order made for payment of section 7 expenses. He argues that if he pays these expenses for the children, his child support obligation should be reduced to $222 per month.
[57] On June 14, 2012, Mr. Justice Fitzpatrick granted an interim consent order which dealt, in part, with s. 7 expenses. The relevant portion of the order dealing with s. 7 expenses provided:
The parties shall share all section 7 expenses with the Applicant contributing 55.6% and the Respondent contributing 44.4% of the expense. Prior to incurring any such expense, the parties shall consult by e-mail and consent to such expense and such consent will not be unreasonably withheld. Should either party obtain third party contribution to any of these expenses then this funding will be applied first prior to contribution by the parties.
[58] This part of the order has proved to be unenforceable from the perspective of the Family Responsibility Office as no fixed amounts were set out. The mother concedes that she has not paid the father anything on account of s. 7 expenses since the order was made. She has not contributed to Christine’s orthodontic expenses. She also conceded that the Fort William First Nation has made third party payments towards the children’s expenses. Specifically, the band paid $100 for each child for school supplies and $700 towards Christine’s driver education.
[59] The availability of third party funding to off-set the children’s s. 7 expenses has become an issue in this case, mainly because the mother has been slow to access funding available from her band. The father cannot do so because he is not a band member.
[60] The cost of Christine’s orthodontic expense which is being wholly paid by the father has also become contentious. The parties anticipate that Kristopher will also require orthodontic work in due course. The mother filed a Manulife pre-treatment estimate for Christine, dated October 4, 2010. This statement estimates Christine’s orthodontic treatment at $5,130. It also estimates the benefit under the father’s plan of $3,078. I conclude that because the work was pre-approved, Manulife will honour its commitment under the prior coverage.
[61] The mother also produced a statement dated October 22, 2010, from the Orthodontic Review Centre of Health Canada relating to Christine. It is not clear whether the father was aware of this pre-approval, given that the parties had by then separated. The statement appears to indicate that payments of $2,630 are available for Christine’s treatment. Nevertheless, the father testified that he continues to bear the entire cost of this work.
[62] I conclude that when these third party plans are accessed, Christine’s orthodontics will be fully paid.
[63] Mr. Justice Shaw ordered the mother to inquire of the Fort William First Nation whether monies are available for the children’s secondary and post-secondary education, orthodontic expenses; and from settlement of land claims. The Band replied:
- Post-secondary education funding for tuition and living allowance is provided to students in the year following high school graduation. Additional post-secondary education may be funded depending on demands on the funding in any given year;
- Secondary students receive up to $300 per year in grade 9 and $200 per year in grades 10 through 12 for uniforms, if required. In addition, a supply allowance of $200 is provided annually;
- A maximum of $500 per child up to the age of 18 per calendar year is available for registration fees and equipment for recreation activities (music, art, dance, sports).
- Christine Danielson and Kristopher Danielson are each entitled to receive distributions in the amount of $36,200.00 plus accumulated interest from the Fort William First Boundary Claim Trust and Fort William First Nation Specific Claim Housing Trust when the children reach the age of 18 years….
[64] The Band also advised that no monies are available at this time for orthodontic treatment.
[65] The Danielson children have been engaged in sports and other activities from an early age. Most of these expenses are not high enough to be classified as extraordinary within the meaning of s. 7.
[66] The father has purchased cell phones for the children and pays the cost of $125 per month. The mother makes no contribution to this expense. In Park v. Thompson, [2005] O.J. No. 1695, the Ontario Court of Appeal held that a cell phone expense was not extraordinary.
[67] Christine has been involved in cycling. She belongs to a local club and is an avid and competitive cyclist. The father purchased a $2,000 bicycle for Kristopher when he became interested in cycling; now, a more costly bicycle is appropriate to Christine’s abilities, as she is winning awards. Both parents agree that she should have a bicycle comparable to Kristopher’s. This is an extraordinary expense.
[68] Christine has joined the travel club at school, with a planned trip to Europe in the coming year. This trip will cost $4,000. The full cost must be paid by December, 2013. The parties agree that this is a reasonable expense. I find that it is also extraordinary.
[69] The parties agree that Kristopher should have the same opportunity if he wishes to travel with his school to Europe.
[70] The travel and bicycle expenses are likely to be non-recurring but extraordinary expenses. Each parent shall assume responsibility for his or her share of the costs as they come due. Otherwise, the children will not be able to benefit from these advantages as the parents intend.
[71] If funding is available for travel club for either child or for Christine’s bicycle, the availability of the third party payment shall be immediately disclosed to the other parent and deducted from the full expense and then the parties are responsible for the balance as follows:
- the father shall pay 61% of the cost of Christine’s bicycle and travel club fees for both children;
- the mother shall pay 39% of the cost of Christine’s bicycle and travel club fees for both children;
- in the event that full third party coverage is not available to either child for orthodontic treatment, the parents shall pay the remaining expense in the above proportions.
[72] In addition, the mother shall provide to the father an irrevocable direction to the Fort William First Nation to release to him any information related to monies or benefits available to or for the children so long as the children remain children of the marriage as defined by the Divorce Act, R.S.C. 1985.
[73] It is impossible to anticipate what further s. 7 expenses may arise for the children apart from post-secondary education. The court expects the parties to behave in a reasonable manner in apportioning responsibility for payment of the children’s expenses. If they are not reasonable, they can expect to spend more time in court, with the attendant cost and stress.
[74] In order to avoid the problems of enforceability, the parties are directed as follows: If a single (as opposed to cumulative) s. 7 expense exceeds $499, the claiming parent shall advise the other parent of the anticipated expense and seek his or her agreement that the expense is reasonable and in the best interests of the children. The claiming parent shall tender receipts for that expense to the other parent who shall pay his or her proportionate share within thirty days. The parties are reminded that the stress of litigation and tension generated by it have a negative impact on the children.
[75] Because most of the children’s s. 7 expenses incurred by the parents are not extraordinary as defined by the Child Support Guidelines, there is no need to reduce child support as the father suggests.
[76] Based on the off-set calculation set out above, the father shall pay to the mother child support for two children in the amount of $444 per month commencing August 1, 2013.
[77] Each parent shall disclose his or her income tax return and notice of assessment each year, no later than June 1, commencing 2014, so long as the children or either of them remain children of the marriage as defined by the Divorce Act. Variations in child support, if any, shall commence on July 1 of the same year.
Health and Beneficiary Designations
[78] On consent, the parties shall each designate the children as beneficiaries of their respective health, life insurance and pension plans for so long as the children are children of the marriage within the meaning of the Divorce Act. As a regime of shared parenting is in place, it is right and convenient that each parent shall be named as trustee of the children’s interest in the other parent’s life insurance and pension plans during their minority. Judgment to issue accordingly.
Costs
[79] If the parties cannot agree on costs, either may apply to the trial coordinator within thirty days for an appointment to argue same, failing which costs will be deemed to be settled. Costs submissions are not to exceed five pages.
Regional Senior Justice H.M. Pierce
Released: July 11, 2013
COURT FILE NO.: FS-11-0004-00
DATE: 2013-07-11
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
James Danielson
Applicant
- and –
Constance Danielson
Respondent
REASONS FOR JUDGMENT
Pierce J.
Released: July 11, 2013
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