COURT FILE NO.: FD1876/07
DATE: July 30, 2013
ONTARIO
SUPERIOR COURT OF JUSTICE
FAMILY COURT
BETWEEN:
Ruthanne Winnifred Studerus
Michael Nyhof for the applicant
Applicant
- and -
Thomas Milton Studerus
William Clayton for the respondent
Respondent
HEARD: March 28, 29, 30, 2012; April 3, 4, 2012; February 1, 2013
MITROW J.
AMENDED DECISION: The text of the original judgment was corrected
on April 24, 2014 and a description of the correction is appended.*
INTRODUCTION
[1] This trial involved the following issues: equalization payment; spousal support; and a limited claim for child support for the youngest child.
[2] The applicant, Ruthanne Winnifred Studerus (“Ms. Studerus”), and the respondent, Thomas Milton Studerus (“Mr. Studerus”), were married to each other on July 3, 1987. They have two children, Kyla (born August 18, 1987), and Roman (born June 27, 1989). The parties had entered into a separation agreement soon after separation. The validity of the separation agreement was called into question by Ms. Studerus. Also, the parties were unable to agree on the date of separation. As a result, a trial of an issue was directed regarding the validity of the separation agreement and the date of separation, and that trial came on before Harper J., who released a decision in April 2009 setting aside the separation agreement and finding that the date of separation was September 2, 2005. It was necessary to deal with the preliminary issue of the validity of the separation agreement because it contained mutual releases affecting spousal support and equalization payment. This separation agreement and the decision of Harper J. are discussed in more detail below.
[3] Mr. Studerus was born April 1, 1961 and Ms. Studerus was born February 18, 1961. At the time of trial, Mr. Studerus was retired from Ford and Ms. Studerus was employed on a full-time basis. The details regarding the work histories of the parties are dealt with below.
[4] The main issues regarding equalization centered on date of marriage deductions for each of the parties and a dispute between the parties as to who received the household contents at date of separation and the value of those contents.
[5] At the commencement of trial, counsel advised that Mr. Studerus’ Ford pension plan was still in the process of being valued by the pension plan administrator pursuant to recent amendments to the Family Law Act, R.S.O. 1990, c. F.3 and the Pension Benefits Act, R.S.O. 1990, c. P.8. As this case had been on a number of previous trial lists and had not been reached, the trial proceeded on the request of both parties. All viva voce evidence was heard and the trial was adjourned to await completion of the pension valuation.
[6] The trial was then continued on February 1, 2013, at which time some additional exhibits were filed including pension valuation and closing argument was heard.
[7] At the conclusion of hearing evidence on April 4, 2012, counsel requested on consent that I consider granting a divorce (as there was no issue regarding same) and then sever the property and corollary relief issues to be determined later.
[8] Accordingly, on April 5, 2012, I made an order severing the granting of a divorce from all remaining issues and granting the divorce.
[9] Spousal support and child support therefore proceed as corollary relief issues pursuant to the Divorce Act.
ISSUE REGARDING CREDIBILITY
[10] In deciding the issues relating to the validity of the separation agreement and the date of separation, Harper J. made adverse findings of credibility regarding Mr. Studerus and preferred the evidence of Ms. Studerus.
[11] Ms. Studerus submits that Harper J.’s findings as to Mr. Studerus’ credibility are some of the factors that should lead me to prefer the evidence of Ms. Studerus over Mr. Studerus.
[12] Mr. Studerus opposes the position taken by Ms. Studerus and submits that I need to make findings of credibility based on the evidence before me. Mr. Studerus further submits that Ms. Studerus is incorrect in referring me to the decision of Harper J. as a factor to consider in assessing credibility.
[13] Ms. Studerus relies on Mazza v. Smith, [2009] O.J. No. 283 (S.C.J.), where the court dismissed an application for bifurcation of a third party insurance coverage issue in claims arising out of a motor vehicle accident. The court stated (at para. 35) that if the third party claim was bifurcated and proceeded first, that any adverse credibility findings against a party will seriously impact that party’s credibility in the main action. Ms. Studerus argues that Mazza supports the conclusion that the credibility findings of Harper J. are to be considered because the case at bar amounts to a bifurcated trial.
[14] Mr. Studerus relies on R. v. Ghorvei, 1999 19941 (ON CA), 46 O.R. (3d) 63 (C.A.), where the accused (the appellant) sought to introduce fresh evidence on appeal that a judge in a subsequent trial found the key witness at the accused’s trial to be “a compulsive liar.” The witness in question in the subsequent trial was the same police officer who testified at the appellant’s trial. The Court of Appeal for Ontario dismissed the application to introduce fresh evidence stating that it was not proper to cross-examine a witness on the fact that his or her testimony has been rejected or disbelieved in a prior case. The Court of Appeal for Ontario stated it would not be useful to allow cross-examination of a witness on what is in essence no more than an opinion on the credibility of unrelated testimony given by the witness in the context of another case (see para. 31).
[15] Mr. Studerus relies also on Laxton v. Coglon, 2006 BCSC 181, affirmed on appeal at 2006 BCCA 178, where the motions judge refused to allow affidavit evidence on the issue of a person’s credibility, that consisted of decisions from courts in prior cases where adverse findings were made as to that person’s credibility. In finding the proffered evidence to be inadmissible, the motions judge reviewed the authorities on the admissibility of character evidence and held that the evidence did not fall within the rule allowing evidence as to a person’s reputation for veracity – a rule that in any event ought to be resorted to only in exceptional circumstances (see para. 48).
[16] Although the present case consisted of two trials, each trial addressed separate and distinct issues. I find on the authorities that my role in the trial before me is to decide the case based on the record before me including viva voce evidence and exhibits and to assess the credibility of each witness based on the record before me.
CHILD SUPPORT
[17] The claim for child support for Roman was confined to the period following separation (September 2005) until June 30, 2007, at which time Roman was 18, had graduated from high school, and had started employment. There was no issue between the parties that Roman was no longer a child of the marriage within the meaning of the Divorce Act as at the end of June 2007.
[18] The parties could not agree where Roman resided following separation. Mr. Studerus seeks support from Ms. Studerus for the period September 2005 to June 30, 2007. The position of Ms. Studerus initially was that she wanted support from Mr. Studerus from January 1, 2006 to June 30, 2007, but her written submissions on closing argument did not request support for Roman. For the purpose of my reasons, I will treat Ms. Studerus’ request for child support for Roman as a live issue.
[19] Much conflicting evidence was heard from the parties as to which parent Roman was residing with. Roman himself testified on that issue. In my view, I need not delve into that evidence.
[20] Ms. Studerus commenced her application, which included a claim for retroactive child support, on November 5, 2007. Mr. Studerus in his pleadings never advanced a claim for child support. He sought only a divorce.
[21] In S.(D.B.) v. G.(S.R.), 2006 SCC 37, 2006 S.C.C. 37, the Supreme Court of Canada held that under the Divorce Act, if a claim is made for retroactive child support, the child must be “a child of the marriage” at the time that the application is commenced. An adult child who is not a dependant is not the type of person for whom Parliament envisioned child support orders being made. Child support is for children of the marriage, not adults, who used to have that status (see paras. 86 to 89).
[22] At the time that Ms. Studerus commenced her application for retroactive child support, Roman was not “a child of the marriage” within the meaning of the Divorce Act.
[23] According, the claims made by each party for child support for Roman are dismissed.
PROPERTY
[24] Mr. Studerus filed two net family property statements as exhibits at trial. No net family property statements were filed as exhibits by Ms. Studerus (although in her written argument, Ms. Studerus included a net family property statement as an aid to oral argument).
[25] The main difference between the two exhibits filed by Mr. Studerus is the inclusion of the value of his Ford pension as determined by the pension plan administrator (see net family property statement Ex. 46).
[26] The issues at trial in relation to calculation of net family property involved the following issues:
a) whether Ms. Studerus could deduct $240,000 as at date of marriage, representing the contingent value of her claim for damages as a result of a motor vehicle accident that occurred prior to marriage;
b) whether Mr. Studerus could deduct the sum of $43,000, representing alleged money that he had in the bank as at date of marriage and whether Mr. Studerus could deduct the sum of $15,000, representing the value of a Thunderbird motor vehicle he stated that he owned at date of marriage;
c) the values to be shown for each party regarding household contents and personal belongings as at date of separation;
d) the value of the Taurus motor vehicle owned by Mr. Studerus and the amount to be credited to Mr. Studerus towards the equalization payments when he transferred this motor vehicle to Ms. Studerus after separation;
e) whether Ms. Studerus is entitled to receive from Mr. Studerus what in essence amounts to a “refund” of the cheque that Ms. Studerus gave to Mr. Studerus in December 2005;
f) although not strictly an equalization payment issue, Ms. Studerus claims that there is still a small amount owing to her regarding payment of her equity in the matrimonial home, which is over and above the sum of $130,000 received by her in 2005 shortly after their separation.
[27] Each of the issues listed above is dealt with below and then appropriate adjustments are made to the last net family property statement filed by Mr. Studerus (Ex. 46) to arrive at the equalization payment.
a. Can Ms. Studerus deduct the sum of $240,000, being the alleged value of her claim for damages as at date of marriage resulting from a motor vehicle accident occurring prior to date of marriage?
[28] In calculating her net family property, Ms. Studerus seeks a date of marriage deduction in the amount of $240,000 representing, she alleges, the contingent value of her claim for damages that she sustained in a motor vehicle collision on June 10, 1986 (being a little over a year prior to the date of marriage). The accident occurred in the parking lot of the Ford assembly plant near Talbotville, where both Ms. Studerus and Mr. Studerus were employed at the time. Mr. Studerus argues that no deduction should be allowed because Ms. Studerus has failed to prove the value of that claim as at date of marriage. For the reasons set out below, I agree with the argument advanced by Mr. Studerus and I disallow this deduction in its entirety.
[29] There is no dispute as to how the accident occurred. I do accept the unchallenged evidence of Ms. Studerus in this regard. She testified that she was coming to work for her afternoon shift. She was in the parking lot in a line of vehicles waiting for a parking space when a vehicle “pulled out, backed up” and struck her vehicle on the driver’s side where she was seated. Ms. Studerus described that the other vehicle “actually swiped me in the driver’s side and the front panel.”
[30] Ms. Studerus described the nature of her injuries as consisting of a whiplash to her left neck, arm and trapezius muscle, and then further elaborating as to the effect of the injuries, Ms. Studerus stated that it went down her arm and into her back and shoulder blade.
[31] Ms. Studerus retained Mr. Andrew Camman to represent her in the civil action that she commenced via statement of claim issued June 7, 1988 (filed as an exhibit at trial, along with an amended statement of claim containing a minor amendment to reflect correctly where Ms. Studerus’ vehicle had been struck).
[32] Ms. Studerus testified in-chief that the claim was settled in either 1988 or 1989 and, when asked how much she received in damages, she replied $240,000. As to whether she had to pay Mr. Camman from that money, Ms. Studerus testified “I think” that the money owing to Mr. Camman was deducted before that, that he took his percentage and then that was what she was awarded.
[33] It was Ms. Studerus’ evidence that most of the settlement proceeds were applied to the purchase of the matrimonial home in Delaware that she testified was purchased for around $315,000. Mr. Studerus did not dispute this estimate. The evidence as a whole supports a finding that the matrimonial home in Delaware was purchased not too long after the motor vehicle accident settlement funds were received and Mr. Studerus concurs that some money from the settlement was applied to the purchase of that matrimonial home, as were the proceeds of sale from their previous matrimonial home.
[34] The documentation relating to the motor vehicle accident was most sparse. Mr. Camman testified at trial. By that time, it had been approximately 25 years since he had been retained by Ms. Studerus. Mr. Camman confirmed that he had been asked by Mr. Nyhof for a copy of his file but that he had been unable to locate it. Much of his evidence was based on memory.
[35] Other than the statement of claim (and the amended statement of claim), only two other documents relating to the motor vehicle accident were available and they were filed as exhibits –a letter dated May 10, 1988 from Mr. Camman to Ms. Studerus and a copy of a medical report from Dr. Howard Cameron dated June 24, 1987, addressed to one Ms. McVicar, a short-term disability analyst at London Life. Dr. Cameron, according to his report, saw Ms. Studerus on June 24, 1987 (this date being nine days prior to the date of marriage). Mr. Camman believed that this medical report was provided by Dr. Cameron to London Life because the latter was likely the insurer paying Ms. Studerus’ wage loss claims while off work from Ford.
[36] There was substantial conflict between the parties as to what became of the motor vehicle file that Ms. Studerus had been maintaining. She claimed that her file was left in a filing cabinet in the matrimonial home at date of separation. The gist of Ms. Studerus’ evidence was that Mr. Studerus had something to do with the disappearance of her file. Mr. Studerus denied having anything to do with the alleged disappearance of the file. He did testify that several days before his trial testimony, he had been looking through his own financial records at the request of his counsel and during that process he came across the aforementioned letter from Mr. Camman to Ms. Studerus and that he promptly turned this over to Mr. Clayton. Mr. Studerus was adamant that whatever records he had, regarding the motor vehicle accident file, had been produced.
[37] As discussed in more detail below in relation to household contents, neither party’s evidence was particularly reliable as to what happened to the matrimonial home contents on separation. Although Ms. Studerus believes her motor vehicle file remained in the matrimonial home, I am not prepared to find as a fact that such was the case. I am not satisfied on the evidence that Mr. Studerus had anything to do with the alleged disappearance of the file. In observing Mr. Studerus give evidence, I did not form the impression that Mr. Studerus possessed sufficient knowledge and sophistication of the legal process that would allow him to assess the relevance or importance of the letter that he found and whether he should hide it or produce it to Mr. Clayton. I accept the evidence of Mr. Studerus that when he found this letter, he understood simply that it had something to do with the motor vehicle accident and that he promptly turned it over to Mr. Clayton.
[38] Mr. Camman, understandably, had little recall about the specifics of the motor vehicle accident claim that he handled on behalf of Ms. Studerus. He could not remember how much it settled for except to say he “understood” it was over $200,000. When asked about his fee arrangement, he testified: “Well I hope it was a third.” He added it was “standard” that one-third of the recovery would be his fees.
[39] Mr. Camman’s letter dated May 10, 1988 was brief and asked Ms. Studerus to arrange for an appointment to discuss the implication of “your pending loss of employment.”
[40] Ms. Studerus testified that as a result of the motor vehicle accident, she did not return to work at Ford, with the exception of some brief failed attempts during which she found that her injuries prevented her from carrying out her work-related duties. This information is corroborated in Dr. Cameron’s report.
[41] At the date of marriage, Ms. Studerus was still an employee of Ford but in receipt of sickness and accident benefits. In her cross-examination, Ms. Studerus admitted that she was always trying to get back to work at Ford because, as she put it: “It was a great paying job.” She agreed in cross-examination that she did not know, as at the date of marriage, the extent of her recovery or how long it would take for her to recover as much as she could from her injuries. Ms. Studerus was clear in her cross-examination that it was always her intention to return to work at Ford if she was able to do so. Ms. Studerus stated more than once that she had a well-paying job that she did not want to lose.
[42] Dr. Cameron’s report confirmed that Ms. Studerus sustained a soft tissue type of injury to the left side of her neck and that she has ongoing symptomatology. The report acknowledged that Ms. Studerus was pregnant at the time of the report (she gave birth to Kyla a little less than two months later) and Dr. Cameron stated in his report that, exclusive of Ms. Studerus’ pregnancy, he would not feel she would be able to return to work for at least the next three to four months.
[43] The onus of proving the exclusion lies on Ms. Studerus pursuant to s. 4(3) of the Family Law Act which states as follows: “The onus of proving a deduction under the definition of “net family property” or an exclusion under subsection (2) is on the person claiming it.”
[44] The contingent value of a motor vehicle accident can be the subject of a proper deduction at date of marriage: Nicholson v. Nicholson, 2012 CarswellOnt 9943 (S.C.J.) at para. 33, relied on by Ms. Studerus.
[45] Ms. Studerus also relies on Trendle v. Trendle, 2003 CarswellOnt 5358 (S.C.J.) at paras. 21 – 27. Although, in that case, the focus was on the date of separation, the issues are analogous to the case at bar.
[46] In Trendle, the parties had separated in April 1998. In May 1992, the husband was involved in a motor vehicle accident, as a result of which he commenced an action that was undefended and was concluded by an assessment of damages in September 2000, with judgment being granted to the husband in the amount of $35,000 for general damages and $149,166 for past loss of income. The husband was faced with including in his net family property as at date of separation an amount representing the value of his loss of income claim. The husband sought to call expert evidence that the value of the award for past loss of income as at date of separation (the valuation date) was less than the amount subsequently determined on the assessment of damages. The husband proposed to call as an expert an experienced civil litigator in personal injury cases to give that evidence. The husband’s theory was that only facts in existence at the valuation date could be considered, those facts would not include the assessed damages and that those facts included a number of contingencies and risks that would merit a lower amount than assessed at the damages hearing.
[47] In Trendle, the trial judge refused to allow the proposed expert witness to be called on the basis that the evidence was irrelevant. The reasons that the trial judge rejected the proposed evidence are important and were based on the following findings:
a) the value of the claim on the date of assessment of damages was the same as on the valuation date;
b) the facts available on the date of the assessment of damages were the same as on the valuation date; and
c) on the assessment of damages, the judge at that hearing made no use of any “additional facts” arising subsequent to the valuation date.
[48] Mr. Studerus submits that Trendle is distinguishable from the case at bar. I agree.
[49] As at the date of marriage, Ms. Studerus was still an employee of Ford and it was unknown by Ms. Studerus how long she would be off work from Ford. Dr. Cameron’s report contained an estimate of at least three to four months. As it turned out, the facts occurring subsequent to the date of marriage show that Ms. Studerus was never reinstated at Ford and that she lost her job at Ford. The letter from Mr. Camman is after the date of marriage and refers to Ms. Studerus’ “pending” loss of employment. None of this critical information was known at the date of marriage.
[50] I accept Mr. Camman’s evidence that Ms. Studerus’ loss of income would have a greater value using her wage at Ford as compared to someone earning less income. However, I do not accept Mr. Camman’s testimony during cross-examination to the effect that the value of the claim was fixed on the date of the accident, and that everything flowing thereafter was an inquiry as to what that value was. Further, Mr. Camman was not testifying as an expert witness.
[51] Mr. Camman testified that Ms. Studerus’ claim included damages for pain and suffering and damages for loss of income. However, there was no evidence how each of those heads of damages was quantified on settlement. More importantly, no evidence was called quantifying the potential damages on the basis of the facts as they existed at the date of marriage.
[52] Assuming I was to accept Ms. Studerus’ evidence that she received $240,000 net of fees, the evidence before the court suggested a fairly minor collision. The description of the injuries was also on the less serious side. These factors suggest that an award in the range of $240,000 would likely be weighted, perhaps heavily weighted, towards loss of income rather than general damages for pain and suffering.
[53] Important facts occurred after the date of marriage. The letter from Mr. Camman, together with his evidence, corroborates that the loss of employment from Ford was a factor arising after the date of marriage. This factor could impact materially on the assessment of damages for loss of income, considering in particular the evidence that Ms. Studerus had a “high paying” job at Ford.
[54] Mr. Studerus cites authorities where the court ascribed no value to proceeds received from a motor vehicle accident settlement because of lack of evidence as to their value: Andrews v. Andrews, [1988] O.J. No. 636 (U.F.C.) and Belgiorgio v. Belgiorgio, 2000 22733 (ON SC), [2000] O.J. No. 3246 (S.C.J.).
[55] I find myself in the same position as the trial judge in Andrews – given the evidence, it is impossible to do anything other than to speculate as to the value of Ms. Studerus’ damage claim as at date of marriage. Ms. Studerus’ evidence that she received $240,000 as a settlement does not assist her in arriving at the value of that asset as at date of marriage for a number of reasons. Firstly, without some corroborating evidence, I am not prepared to accept that that is the amount that Ms. Studerus actually received. Secondly, the equivocal evidence of Ms. Studerus does not satisfy me that whatever Ms. Studerus did receive was net of fees. Thirdly, the evidence is clear that whatever amount Ms. Studerus did receive, it was affected by material facts intervening subsequent to the date of marriage.
[56] I find that Ms. Studerus has failed to discharge her onus in proving the value of her damage claim as at the date of marriage.
b. Is Mr. Studerus entitled to deduct as at date of marriage assets the sum of $15,000 for a motor vehicle and the sum of $43,000 in a bank account?
[57] Mr. Studerus sought to deduct two date of marriage assets - $15,000 for a Ford Thunderbird that he claimed he owned and $43,000 that he claimed he had in a bank account.
[58] I find Mr. Studerus’ evidence relating to these alleged date of marriage assets as neither credible nor reliable and amounting to little more than a last minute and somewhat brazen attempt to reduce his net family property.
[59] Regarding the Ford Thunderbird, Mr. Studerus agreed in-chief he had never disclosed this date of marriage asset in his previous financial statements. The first disclosure occurred in his financial statement sworn just prior to trial. He claims to have purchased the Ford Thunderbird in 1985 for $16,000 or $17,000. When asked in-chief whether he had any paperwork, his rather surprising answer was that he “could get some.” Mr. Studerus failed to muster any plausible explanation as to why this alleged paperwork was not produced at trial. His attempt to explain the non-disclosure of this alleged date of marriage asset over many previous years of litigation is suspect and not credible. Further, I accept Ms. Studerus’ evidence that Mr. Studerus did purchase a Ford Thunderbird but this was after the date of marriage when Kyla was born.
[60] Regarding the $43,000 that Mr. Studerus claimed he had in his bank account at date of marriage, he points to the fact that in June 1988 he and Ms. Studerus purchased jointly a home on Boler Road for $114,000. The mortgage was $84,000, so Mr. Studerus reasoned that the $30,000 down payment must have come from savings he had accumulated at date of marriage. He also testified that he received $13,000 when his father passed away, although his evidence was unclear as to whether his father’s passing and/or receipt of the money was before or after the date of marriage. The land registry documents relating to the purchase of the Boler Road property were filed as exhibits.
[61] When asked in cross-examination about having no proof as to the $43,000, Mr. Studerus responded “Not right now, I don’t, no.” When pressed by Mr. Nyhof as to when this disclosure might be available, Mr. Studerus stated he can try to get it. There was no further evidence at trial regarding his attempt to get this disclosure.
[62] On his own evidence, Mr. Studerus has failed to prove this date of marriage deduction. His evidence as to proof is nothing more than unsubstantiated speculation. Although Ms. Studerus agreed that there was a $30,000 down payment on the Boler Road property, she testified, and I accept her evidence, that the money came from the joint account to which she also had contributed when she was working.
[63] Accordingly, I disallow Mr. Studerus’ date of marriage deductions in the amount of $15,000 and $43,000. Mr. Studerus has failed to discharge his onus proving those deductions.
c. Household Contents and Personal Items
[64] Despite the number of years this case has been before the court, the presentation at trial by both parties on the issue of the value of household contents and personal items was, respectfully, somewhat disorganized.
[65] There was a substantial dispute between the parties as to the household contents that Ms. Studerus took with her when she physically left the matrimonial home in late 2005. Having heard the evidence of both parties, and also the evidence of their son, Roman, who was called as a witness by Mr. Studerus, I accept the evidence of Ms. Studerus as to the rather few items that she was able to take with her from the matrimonial home. I reject entirely the evidence of Mr. Studerus as to the many trips he testified were taken between the matrimonial home and Ms. Studerus’ residence delivering household contents. I accept the evidence of Ms. Studerus that there were only a few trips and the vehicles involved were her car and Mr. Studerus’ truck. I reject the evidence of Mr. Studerus that another individual allegedly brought his truck to help the parties move.
[66] However, the determination as to the contents taken by Ms. Studerus and the contents that remained in the matrimonial home is really of little assistance. The difficulty for both parties is the dearth of admissible evidence as to the value of household contents and personal items.
[67] Ms. Studerus, in her various financial statements, gave significantly diverging estimates of the matrimonial home contents retained by Mr. Studerus – from an amount of $60,000 according to her first three financial statements, to $30,000 in subsequent financial statements. During closing argument, Ms. Studerus submitted that the value of the household contents retained by Mr. Studerus at date of separation should be set at $34,333 (representing the total purchase price, less the children’s furniture and less an arbitrary 50 percent reduction), plus $15,000 for the “12 or 13” limited edition prints allegedly in Mr. Studerus’ possession for a total of $49,333.00.
[68] There was little or no evidence at trial regarding efforts made by the parties since 2007 (when this case started) to agree on an appraiser to value as many of the household items (including personal items) as possible, nor was there any evidence that either party brought a motion to compel the other to cooperate in valuing household contents or personal items. Despite the substantial amount sought by Ms. Studerus to be added to Mr. Studerus’ net family property for household contents, Ms. Studerus did not prepare the usual tabbed net family property brief describing and listing all the disputed household contents, together with backup admissible documentary evidence to assist the court in valuing each chattel as at date of separation. Instead, Ms. Studerus filed as an exhibit a three page handwritten document, (hastily prepared during a recess in her evidence in-chief), based on her memory and summarizing her recollection of the matrimonial home contents, room by room, as at date of separation including for each item the year of purchase, the purchase price and its condition at date of separation.
[69] A ruling had to be made during trial that neither party could give evidence as to the value of household contents at date of separation, although each party was permitted to give evidence as to the purchase price and the condition of the chattel at date of separation.
[70] What transpired at trial, unfortunately, was a tedious and unnecessary lengthy examination in-chief and cross-examination of each party, at times on a chattel-by-chattel basis, that elicited mostly conflicting evidence demonstrating that the parties were unable to agree on who got what at date of separation, or what was the purchase price, or even the condition of the chattel.
[71] Mr. Studerus did file a tabbed net family property brief that listed various items of jewellery that he submitted should be added to Ms. Studerus’ net family property. Although Ms. Studerus concurred that she had some of the jewellery as at date of separation, she neglected to list any jewellery in calculating her net family property (see for example her financial statement sworn just prior to trial). As proof of value at date of separation for this various jewellery, Mr. Studerus provided copies of purchase invoices of some of the jewellery and included also for some of the jewellery inadmissible appraisals obtained between 7 to 18 years (approximately) prior to the date of separation. In an effort to be “fair” Mr. Studerus deducted an arbitrary 30 percent from the purchase price or appraisal value of the jewellery and this resulted in a net amount of $7,455 being added to Ms. Studerus’ net family property. (The net amount was the figure obtained after deducting the jewellery items that Ms. Studerus apparently had at date of marriage.)
[72] Acting reasonably, during the four and a half years of litigation and well before trial, the parties could easily have agreed to compile lists of household contents and personal items in dispute and to have at least some items appraised. If one of the parties was acting unreasonably, a motion could have been brought.
[73] Both parties lost all focus in their responsibility to assist the court. There was a lack of any semblance of cooperation between the parties to deal with their disagreement in a process that was efficient and that minimized cost. The result was an unnecessary use of court resources and an unnecessary increase in legal costs.
[74] Regarding the purchase price of the various household contents (to the extent that purchase price was relevant), I place little weight on the evidence of either party as to his or her recollection of the purchase price. Almost all the items were purchased over a decade prior to trial – in some instances two decades ago. No backup documents as to the purchase price for any household items were produced. There was one exception and that related to the evidence of Ms. Studerus that she spent $14,000 to $15,000 on a pool table for the recreation room. This was a gift for Mr. Studerus on his 34th birthday. After hearing this evidence, Mr. Studerus located the receipt for the pool table purchase (it was purchased March 5th, 1995), confirming that the cost of the pool table inclusive of delivery, installation and taxes was $4,369.99. Ms. Studerus was forced quite reluctantly to admit that she was nowhere close to her estimate of the purchase price. She explained, unconvincingly, that she must have included in her recollection of the cost of the pool table the various renovation costs that were done to the recreation room to accommodate the pool table. I find that Ms. Studerus was caught off guard that Mr. Studerus could scramble on such short notice to unearth this receipt. Her explanation that she included the renovation costs was, quite frankly, not believable. Ms. Studerus added further confusion by listing the purchase price of the pool table as $10,000 in her handwritten list (referred to earlier that Ms. Studerus prepared during a recess).
[75] The end result is that neither party has produced any admissible evidence as to the value of the household and personal items at date of separation. It is impossible to attribute a value to the household contents and personal items absent an exercise of speculation. The lack of evidence as to the value of household contents and personal items in this case is similar to the circumstances in D’Amico v. D’Amico, 2011 CarswellOnt 9 (S.C.J.) at paras. 13 to 17. In that case the trial judge excluded any values from the equalization calculation because of the failure of the parties to provide admissible appraisal evidence of the value of contents. I adopt the same approach. Other than the minor exceptions noted below, household contents and personal items will not be included in either party’s net family property.
d. The Value of the 2002 Ford Taurus and the Credit to be Given to Mr. Studerus for Transferring this Vehicle Post-Separation to Ms. Studerus
[76] Although not a significant issue, Mr. Studerus proposed that the 2002 Ford Taurus that he owned at date of separation be valued at $12,750. I am prepared to accept that amount as an admission against interest absent any other admissible evidence.
[77] Mr. Studerus then transferred the Ford Taurus subsequent to date of separation to Ms. Studerus. There was a dispute as to the amount of credit Mr. Studerus should be given for the transfer. Ms. Studerus submits it should be $10,000, Mr. Studerus claims it should be $12,750.
[78] The evidence from Ms. Studerus was that this vehicle was disposed of not too long after the date of separation. She recalled receiving at that time an allowance of somewhere between $11,200 and $11,700 for this vehicle. Accordingly, I accept the evidence of Ms. Studerus that the vehicle had a value of $11,700 at or about the time it was transferred to her. Mr. Studerus will be given a credit for that amount towards the equalization payment.
e. Is Ms. Studerus entitled to a reimbursement of $4,558.48?
[79] There was insufficient evidence adduced at trial that would justify an order requiring Mr. Studerus to pay back to Ms. Studerus the sum of $4,558.48, represented by the cheque that Ms. Studerus gave to Mr. Studerus for that amount dated December 5, 2005. I find that Ms. Studerus voluntarily paid that amount to Mr. Studerus as her share of a joint debt.
f. Adjustment Regarding Payment Received by Ms. Studerus when she Transferred the Matrimonial Home to Mr. Studerus
[80] Pursuant to the separation agreement that was set aside Ms. Studerus received $130,000 that in essence was intended to represent her equity in the matrimonial home.
[81] Ms. Studerus seeks an adjustment regarding a small balance owing and I accept her position that she is entitled to this.
[82] At the time of the transfer of the matrimonial home (which occurred in the latter part of 2005) the evidence at trial discloses the equity as follows:
a)
b)
c)
d)
e)
f)
The value of the matrimonial home
The outstanding mortgage (rounded)
Net equity
Ms. Studerus’ 50% share (rounded down)
Amount received by Ms. Studerus
Amount owing to Ms. Studerus
$313,000
-$45,087
$267,913
$133,956
-$130,000
$3,956
[83] Accordingly, Mr. Studerus forthwith shall pay to Ms. Studerus the sum of $3,956.
g. Calculation of Equalization Payment
[84] I accept the evidence filed by the parties (Ex. 45) that the Family Law value of Mr. Studerus’ Ford pension if $191,922.36. I am satisfied on the evidence that the calculation of net family property for each party shall be as set out in Ex. 46 (subject to the adjustments discussed below). The parties had also agreed during closing argument that the contingent tax liability discount for the pension should be 18 percent rather than 20% as claimed in Ex. 46 and accordingly the calculation below makes that adjustment.
[85] Regarding household contents and personal items, the only items to be included in either party’s net family property are those items he or she admits having and where he or she has admitted a value. I accept the value as an admission against interest. For Mr. Studerus, this will include the $4,000 for his prints and $500 for his computer. Ms. Studerus presented no admissible evidence as to the value of the prints retained by Mr. Studerus. For Ms. Studerus, this will include the $1,000 value that she attributed to the household contents that she retained. These amounts are disclosed in each party’s sworn financial statements and, in relation to Mr. Studerus, the above items owned by him are included in his net family property shown in Ex. 46.
[86] I find the net family property of Ms. Studerus to be as follows:
a)
b)
c)
Net family property as per Ex. 46
Deduct net adjustment for jewellery
Add household contents (Ms. Studerus)
Net Family Property:
(No adjustment necessary for $240,000 date of marriage deduction because this was not included in Ex. 46.)
$141,411.43
-$7,455.00
$1,000.00
$134,956.43
[87] I find the net family property of Mr. Studerus to be as follows:
a)
b)
c)
Net family property as per Ex. 46
Add back date of marriage deductions
Add back 2% of the Ford pension value to account for contingent tax liability being reduced from 20% to 18%
Net Family Property:
$243,038.10
$58,000.00
$3,838.45
$304,876.55
[88] The equalization payment owing by Mr. Studerus to Ms. Studerus is as follows:
a)
b)
c)
d)
Difference in net family property
Equalization payment (one-half difference)
(Equalization payment rounded)
Deduct agreed upon payment of fees for adjournment
Deduct credit for value of Ford Taurus transferred to Ms. Studerus
Total equalization payment owing by Mr. Studerus:
$169,920.12
$84,960.06
$84,960.00
-$5,000.00
-$11,700.00
$68,260.00
[89] This is not an appropriate case to award pre-judgment interest on the equalization payment or the balance owing to Ms. Studerus for the transfer of the matrimonial home to Mr. Studerus. The bulk of the capital assets of Mr. Studerus were non liquid and although he did receive (as explained below) a buyout package that included a transfer of $75,000 to his RRSP, the evidence which I accept is that the RRSP has now been completely depleted. (Details regarding the RRSP depletion are dealt with below.)
[90] During oral argument both parties agreed that once the equalization payment is determined that further submissions should be made regarding how and when that equalization payment should be paid.
[91] Accordingly, judgment shall issue requiring Mr. Studerus to make an equalization payment to Ms. Studerus in the amount of $68,260 but that the method and timing of that equalization payment shall be determined after further submissions.
SPOUSAL SUPPORT
a. Position of the Parties
[92] Ms. Studerus submits that spousal support should be paid for the years 2006 to 2011 inclusive. A portion of that would be retroactive spousal support being the period starting January 1, 2006 up to November of 2007 when the application was issued. Ms. Studerus submits that spousal support should be calculated for each of those years and the totals owing for each year should be added together as a lump sum payment (from which should be deducted the amount paid pursuant to the existing interim order) with the remaining balance to be reduced by 20 percent to reflect that the payment would not be taxable or tax deductible.
[93] To support her position, Ms. Studerus has provided a series of calculations under the Spousal Support Advisory Guidelines (“SSAG”) (see Ex. 47).
[94] The position of Mr. Studerus is that the spousal support that has been paid pursuant to the interim order discharges any obligation Mr. Studerus may have had to pay support and that no additional support should be paid. Mr. Studerus does not provide any SSAG calculations.
b. Effect of the Judgment and Reasons for Judgment of Harper J. dated April 20, 2009
[95] While the decision of Harper J. was under reserve, Mr. Studerus received and accepted a buy-out package from Ford. Apparently an affidavit was filed by Mr. Studerus to advise the court of same while the judgment was under reserve. Harper J. (at para. 93) notes that Mr. Studerus did not ask for leave to file further evidence and Harper J. made a finding that Mr. Studerus has chosen to be underemployed thereby making it difficult, if not impossible for Ms. Studerus to pursue a claim for support.
[96] At the trial before me during opening argument, counsel advised that steps had been taken by Mr. Studerus to set aside that finding made by Harper J. and this resulted in a further attendance before Harper J. Counsel advised that during this attendance it was agreed on behalf of Ms. Studerus that the election by Mr. Studerus to take the retirement package offered to him, per se, was not unreasonable and did not constitute intentional underemployment. It is conceded by Mr. Studerus that the issue as to whether Mr. Studerus’ failure to obtain alternate employment subsequent to date of retirement can amount to intentional underemployment remains a live issue.
[97] It was urged by Mr. Clayton that Harper J. “found” that Ms. Studerus is entitled to “some compensatory support,” and that it will be the position of Mr. Studerus that he has now paid that support. Mr. Studerus admits that the issue of spousal support is now res judicata except whether the amount of the interim order satisfies the compensatory entitlement. Ms. Studerus does not agree with this submission.
[98] Harper J. was conducting a trial of two issues pursuant to an order of Aston J. dated April 1, 2008. The issues to be determined were stated as follows:
Whether the separation agreement governs the rights of the parties; and
What is the valuation date.
[99] The reference to compensatory support made by Harper J. was stated in para. 91:
The agreement that she entered into in November of 2005 called for a complete release of spousal support. I find the agreement is unconscionable. It does not consider the objectives for support as set out in the Divorce Act s. 15. Given the roles that were played during this marriage, with respect to child care and household management, I find that Ms. Studerus would be entitled to some compensatory support. This marriage was for a relatively long period. The drastic difference in standards of living that result for the impact of this agreement does not consider the objective of s. 15 as it relates to the equitable sharing of the resources of this marriage.
[100] After setting aside the separation agreement and determining the valuation date, Harper J. then ordered that this matter shall proceed to trial “… on the issue of calculation of equalization payment and what, if any, spousal support should be paid by Mr. Studerus to Ms. Studerus” (see para. 98).
[101] The issue of spousal support was not before Harper J. The reference by Harper J. to compensatory support was made in the context of whether the release of spousal support in the separation agreement was consistent with the objectives of spousal support set out in the Divorce Act. I find there is nothing in the judgment of Harper J. that was intended to fetter the discretion of the trial judge hearing the spousal support issue.
c. Background
[102] Mr. Studerus and Ms. Studerus met when they were both working at Ford. They were both assembly line workers at the time. Mr. Studerus worked at Ford his entire adult life having started there in 1979 when he finished school and was in his late teens. Mr. Studerus retired from Ford effective April 1, 2009 at age 48.
[103] It is necessary to deal with the date of cohabitation as this will affect any potential spousal support. The position of Ms. Studerus is that cohabitation started in 1983 and Mr. Studerus disagrees with that, saying it was 1985.
[104] The determination of when Mr. Studerus and Ms. Studerus began their cohabitation was tied into the date that Ms. Studerus started working at Ford.
[105] However, there was some inconsistency in Ms. Studerus’ evidence as to when she started working at Ford. Initially, in her evidence in-chief she testified that she began working at Ford in 1981 or 1982. She said it was in August that she started there.
[106] Ms. Studerus then agreed in response to a leading question during her evidence in-chief that she started working at Ford in 1982 or 1983. When asked in-chief when she started to cohabit with Mr. Studerus, Ms. Studerus testified that it was probably about six months after she began working at Ford and dating Mr. Studerus that he moved into her apartment. This evidence was followed by another leading question as to whether that would be in about 1983 sometime, and Ms. Studerus agreed with that comment, adding that she thought it was in the springtime.
[107] In cross-examination, Ms. Studerus was confronted with the letter from Dr. Cameron that contained a summary of her work history (as reported to Dr. Cameron by Ms. Studerus) indicating that Ms. Studerus started working at Ford in August, 1984. Ms. Studerus responded that she was not sure as to the exact date and that now she was not sure whether it was 1983 or 1984. I found Ms. Studerus to be rather evasive in responding to a suggestion whether it could be that she started at Ford in August 1984 given the contents of Dr. Cameron’s letter. Ms. Studerus repeated during her cross-examination that she could not be sure when she started at Ford. She did repeat that she met Mr. Studerus about one month after working at Ford.
[108] Mr. Studerus, in his cross-examination, denied that cohabitation started in 1983 and he testified that he met Ms. Studerus while she was working at Ford and that she started working there in “1984.” It was also his recollection that they moved in together in late 1985.
[109] On the issue as to when cohabitation started the evidence does not support Ms. Studerus’ claim that cohabitation began in 1983. I place little weight on Ms. Studerus’ responses to leading questions during her examination in-chief. She admitted during cross-examination that she was not sure when cohabitation started.
[110] I find that Dr. Cameron’s report contains an accurate summary of other matters reported to him by Ms. Studerus including how the motor vehicle accident happened and, accordingly, the reference in the letter to a start date of August 1984 does provide some reliable corroboration.
[111] I find the evidence of Ms. Studerus as to the year that she started working at Ford to be most unreliable. On that point, I prefer the evidence of Mr. Studerus. Ms. Studerus did say that she started in “August” and this is corroborated in Dr. Cameron’s letter. I find that Ms. Studerus commenced work at Ford in August 1984 and I accept her evidence that she was cohabiting with Mr. Studerus within six months after they met, with cohabitation commencing in the spring. I find therefore that cohabitation started in spring 1985. Accordingly, I will treat the relationship of Mr. Studerus and Ms. Studerus as having a duration of 20 years.
[112] I find that Ms. Studerus gave the history of her own employment and her role in the household in a straightforward and reliable fashion and I accept her evidence. There was, in my view, little if any controversy between the parties as to Ms. Studerus’ employment history and role in the marriage.
[113] After leaving her employment at Ford (the timing of her departure from Ford due to her injuries having been dealt with earlier), Ms. Studerus remained a stay-at-home parent until about 1997. Ms. Studerus then obtained full-time employment at Sears where she worked for approximately a year. Thereafter, Ms. Studerus had various other retail or clerical jobs until 2001 when she began working for a local candy company. In November 2002, while employed at the candy company, Ms. Studerus sustained a workplace injury to her wrist that included damage to her ligaments and/or tendons. Ms. Studerus received Worker’s Compensation (“WSIB”) benefits as a result of this injury. Ms. Studerus described undergoing two surgeries (in approximately 2001 and 2004) as a consequence of this injury. She remained on WSIB benefits since sustaining the injury and she did not return to work until approximately the time of separation at which time she had been taking a course as part of a retraining strategy and this included a volunteer co-op placement for six weeks at a doctor’s office. Ms. Studerus was hoping to get a medical receptionist/patient care job that she had been training for.
[114] Ms. Studerus accepted a lump sum payout from WSIB during 2006 in the amount of a little over $17,000 to compensate her for her wrist injury. Starting approximately late December 2006 Ms. Studerus obtained employment with various successive employers mainly in clerical capacities. Eventually, Ms. Studerus began working for Sifton in a clerical capacity where she continued to be employed at the time of trial. She earned a little over $34,000 in 2011.
[115] There was no evidence at trial as to Ms. Studerus having any sequelae from her wrist injury affecting her capacity to fulfill the requirements of her current employment.
[116] As at trial Ms. Studerus was not residing with anyone in a common law relationship.
[117] In relation to Mr. Studerus, as previously indicated, he worked for Ford during his entire work history. He was there a little over 30 years. Mr. Studerus’ career at Ford was punctuated with numerous absences from work (one lasting approximately two years) related to workplace injuries that he sustained at Ford. I accept the evidence that Mr. Studerus gave as to his injuries and the effect on him of his injuries. His evidence was given in a clear, straightforward and reliable manner and was corroborated in a material way by extensive medical reports filed at trial.
[118] Mr. Studerus’ workplace injuries consisted of an injury to his right shoulder in 1985 and to his left elbow in 1998. Mr. Studerus had two surgeries on his right shoulder and one surgery on his left elbow. Mr. Studerus testified as to ongoing pain in both his right shoulder and left elbow. He reports limitation of movement for both his shoulder and his left elbow. For pain management he has had a longstanding prescription for Oxycontin and he takes cortisone.
[119] Regarding his shoulder, the most recent medical note dated September 14, 2011 reports ongoing chronic pain and reduced range of motion. Regarding his left elbow, the most recent clinical notes (September 22, 2011 and January 23, 2012) confirm ongoing pain. Mr. Studerus testified he was weighing his options as to whether to have further surgery on his left elbow. The last clinical note lists various risks associated with this potential surgery and the note indicates that Mr. Studerus was going to think things over.
[120] Mr. Studerus testified he is limited in what he can do because of the limitation of movement in his right shoulder. He also testified that this affects the strength in his right arm. As to his left arm, Mr. Studerus testified he cannot extend it and he continues to wear a brace to protect his elbow. He reports difficulty straightening his left arm and decreased strength.
[121] After his elbow surgery, Mr. Studerus worked in “general stores” at the Ford plant to accommodate his medical condition. This job was not physically demanding. Mr. Studerus described it as a “great job” and he continued in that position until he retired. Mr. Studerus testified, and I accept his evidence, that it was well known that the Ford plant at Talbotville was slated for closure (and it did indeed eventually close). Mr. Studerus was presented with a settlement incentive package that required an acceptance on short notice on a specified date in February 2009 (and, as previously indicated, at this time the trial before Harper J. had concluded and a decision was on reserve). The incentive consisted of a $75,000 bonus that could be rolled into an RRSP (which is what Mr. Studerus did) plus a $35,000 voucher that could be applied towards the purchase of a Ford motor vehicle but only for a period of one year. If used, the $35,000 voucher became taxable income. Not surprisingly, and I would add quite reasonably in the circumstances, Mr. Studerus accepted the offer.
[122] Within the one-year deadline Mr. Studerus exercised the voucher option in 2010 by purchasing a new truck and in that year $35,000 was added to his taxable income.
[123] As matters unfolded, and unfortunately for Mr. Studerus, the $75,000 RRSP bonus had disappeared entirely by 2011 being used, according to Mr. Studerus, to pay his legal fees (and presumably to pay the tax associated with the RRSP withdrawals). The money from the collapse of his RRSP fell into income in 2010 and 2011.
[124] Also, Harper J. ordered Mr. Studerus to pay costs of the trial in the amount of $29,461. Mr. Studerus testified he paid those costs by increasing the mortgage on the former matrimonial home that he still owns.
[125] At trial, and on an ongoing basis, Mr. Studerus’ annual income consists of his Ford pension ($38,527 in 2011) and WSIB payments ($4,681 in 2011).
[126] Since 2008 Mr. Studerus has been residing with Ms. Gale Howse at his former matrimonial home. Ms. Howse testified and told the court that she has various health issues including chronic pain and she has had various surgeries including rotator cuff and spinal surgery. Ms. Howse last worked at the City of London where she had been for 25 years. She testified she is currently on long term disability benefits, receiving about $1,700 a month gross and at the time of trial had recently applied for Canada Pension Plan Disability benefits. Ms. Howse has various debts and no assets.
[127] Ms. Howse uses the money she receives to pay her debts and fund her personal expenses.
[128] Ms. Howse appeared to be a credible witness and her evidence was not challenged in any material way. It is clear from Ms. Howse’s evidence that Mr. Studerus is in effect supporting her, in part, by providing her with a place to live in the former matrimonial home and that on her own Ms. Howse would not be able to reside in a residence as comfortable as the former matrimonial home.
[129] At trial Ms. Studerus, as alluded to earlier, makes no claim for spousal support past December 31, 2011. Her position recognizes that a significant portion of Mr. Studerus’ income after retirement is from his Ford pension that will be equalized. This is not an appropriate case (nor did Ms. Studerus suggest it was) to consider a spousal support order that results in “double-dipping” as discussed in Boston v. Boston, 2001 SCC 43, 17 R.F.L. (5th) 4 (S.C.C.). Ms. Studerus did not seek a finding of imputation of employment income to Mr. Studerus subsequent to his retirement.
[130] I find, on the evidence of Mr. Studerus and the medical evidence, that Mr. Studerus’ capacity to work is quite limited absent employment where his work conditions can be accommodated to meet his physical limitations. There was no evidence presented at trial that could justify imputing income to Mr. Studerus.
[131] Accordingly, based on the evidence at trial, there will be no order for spousal support after 2011.
[132] I have considered the factors in s. 15.2(4) of the Divorce Act. The parties were together for approximately 20 years. During a substantial portion of the relationship, Ms. Studerus was a stay-at-home parent while Mr. Studerus worked at Ford. Regarding any order or agreements (s. 15.2(4)(c)) there was, firstly the separation agreement. Harper J. found the separation agreement to be unconscionable. The separation agreement provided mutual releases as to spousal support and pension division. Ms. Studerus, pursuant to the agreement, was required to transfer her interest in the matrimonial home to Mr. Studerus (which she did) and Mr. Studerus was to make an “equalization payment” of $130,000. In reality, this was not an equalization payment – it was a payment representing slightly less than Ms. Studerus’ 50 percent share in the equity of the jointly-owned matrimonial home. Harper J. was very critical of Mr. Studerus’ conduct. At para. 85, Harper J. stated:
- I find that Mrs. Studerus signed the agreement under the circumstances in order to free herself from what had become an unbearable living situation. She remained in the matrimonial home in order to protect her children from the impact of separation and, as a result, she was living in isolation. Mr. Studerus took advantage of the vulnerabilities of Mrs. Studerus. From the date of separation forward, he turned up the pressure on his wife by cutting off access to finances. He cancelled credit cards that she had access to. He also prevented her from accessing the bank account that she formerly had. Under this increased pressure, I find that Mrs. Studerus was placed in a position that she would have signed any document that would have allowed her to see some light at the end of the tunnel, regardless of its fairness.
[133] In relation to orders, soon after Harper J. released his decision, Ms. Studerus sought and obtained an order dated June 1, 2009 requiring Mr. Studerus on an interim and without prejudice basis to pay spousal support to Ms. Studerus in the amount of $750 commencing June 1, 2009.
[134] Regarding the condition, means, needs and other circumstances of the parties, Mr. Studerus continues to reside in the former matrimonial home. His mortgage is over $200,000, taking into account the $130,000 he borrowed to pay Ms. Studerus in 2005 and later the approximate $30,000 to pay the trial costs. Unlike Mr. Studerus, however, Ms. Studerus has been forced to downsize, living in a much more modest residence that she now owns. Once the equalization payment has been made however, that should provide more parity in their respective net worth.
[135] I have considered the objectives of a spousal support order set out in s. 15.2(6) of the Divorce Act. I find Ms. Studerus suffered an immediate economic disadvantage on separation – she had little or no income and received no spousal support from Mr. Studerus. This required Ms. Studerus from time to time to encroach on the capital payment of $130,000 that she received. Until his retirement Mr. Studerus continued to work on a full-time basis. During this time Ms. Studerus had no way to get spousal support given the separation agreement and Mr. Studerus’ continued reliance on that agreement. After separation, until retirement, Mr. Studerus enjoyed some high income years, as discussed in further detail below, while continuing to pay no spousal support despite a 20-year relationship and despite the fact that since 2008 he was supporting Ms. Howse by allowing her to reside in the former matrimonial home.
[136] I find there is a compensatory component to Ms. Studerus’ entitlement to spousal support given her assumption of childcare responsibilities. This resulted in Ms. Studerus delaying her re-entry into the workforce while at the same time allowing Mr. Studerus to continue with his employment at Ford.
[137] In relieving economic hardship arising from the breakdown of the marriage, I find that Ms. Studerus is entitled to spousal support. The principles applicable to determining spousal support post application (in this case after November 2007) do not engage the analysis required when a retroactive support order is sought because post-application support payments are not retroactive support payments: MacKinnon v. MacKinnon 2005 13191 (ON CA), 2005 CarswellOnt 1536 (C.A.) at paras. 20, 21. Ms. Studerus seeks retroactive spousal support commencing January 1, 2006. She does not seek retroactive spousal support during 2005 from the date of separation (September 2, 2005), given that she remained in the matrimonial home until near the end of December of that year. Ms. Studerus’ claim for retroactive spousal support requires a consideration of a number of factors: Marinangeli v. Marinangeli, 2003 27673 (ON CA), 2003 CarswellOnt 2691 (C.A.). These factors encompass: a) need and corresponding ability to pay; b) improper conduct by payor spouse; c) need to encroach on capital; d) excuse for delay in bringing the application; e) notice to payor spouse of intention to pursue support; and f) unreasonable burden on payor spouse.
[138] In considering and balancing these factors as they apply in the present case, I find that Ms. Studerus is entitled to retroactive spousal support for the period January 1, 2006 to November 2007. A key factor is the conduct of Mr. Studerus as discussed above. Given that conduct it is in part understandable why Ms. Studerus waited to retain counsel and start her claim. Any prejudice incurred by Mr. Studerus as to any delay in commencing the application is outweighed by his conduct and the other factors. Ms. Studerus had a clear need for spousal support and, as discussed below, Mr. Studerus had the ability to pay. Ms. Studerus had to encroach on her capital, as previously mentioned. Finally, any potential financial burden on Mr. Studerus can be addressed by terms of payment.
[139] For the period November 2007 to the end of 2011, Ms. Studerus continued to experience economic hardship that can be addressed by an order of spousal support.
d. Quantum of Spousal Support
[140] I have considered the SSAG calculations filed on behalf of Ms. Studerus. I accept the approach suggested by Ms. Studerus which is to quantify the spousal support owing for each year, then deduct the amount paid pursuant to the interim order and require Mr. Studerus to pay the difference as a lump sum payment. Ms. Studerus submits the difference should be discounted for tax and suggests a 20 percent discount which I find to be reasonable.
[141] The SSAG calculations prepared by Ms. Studerus show WSIB income for both parties although not for all years for Ms. Studerus. Although that income is non-taxable, no gross-up calculations were provided. Accordingly, I have dealt with spousal support without considering any grossed-up amounts. Given that Mr. Studerus received more WSIB income in the years in question than did Ms. Studerus, the non gross-up of WSIB income would favour Mr. Studerus to some extent.
[142] Both parties filed various exhibits confirming their respective incomes for 2006 to 2011. Starting for the year 2009, when Ms. Studerus began to receive interim spousal support, any discussion below as to Ms. Studerus’ income excludes spousal support.
[143] For 2006 the income for Mr. Studerus is $68,512 and for Ms. Studerus it is $18,133. The SSAGs show monthly ranges (low-mid-high) as $1,355 - $1,616 - $1,847. Ms. Studerus submits throughout that the mid-point should be used. However, it is noted that all SSAG calculations used the without child support formula and assume a 22-year cohabitation (except the year 2011 as discussed below), whereas I have found the period of cohabitation to be 20 years. Given that the length of cohabitation is one of the variables in the SSAG formula, I have taken into account that the SSAG ranges produced in the calculations will be somewhat higher as a result of using 22 years rather than 20 years.
[144] For 2006 I fix the monthly spousal support at $1,500 for an annual equivalent of $18,000.
[145] For 2007 the income for Mr. Studerus is $98,639 and for Ms. Studerus it is $19,764. The SSAG calculation incorrectly uses $18,647 for Ms. Studerus (being the reported rather than the assessed income.) The SSAG ranges show $2,200-$2,566-$2,933. I have considered the under-reporting of income for Ms. Studerus.
[146] For 2007 I fix the monthly spousal support at $2,250 for an annual equivalent of $27,000.
[147] For 2008 the income for Mr. Studerus is $83,272 and for Ms. Studerus it is $28,634. The SSAG ranges show $1,515-$1,768-$2,020.
[148] For 2008 I fix the monthly spousal support at $1,600 for an annual equivalent of $19,200.
[149] For 2009 Mr. Studerus reports line 150 income of $142,697. This includes his pension income from Ford ($28,713) that should be removed as it is being equalized. The RRSP deduction is shown at $74,053. RRSP income is shown at $78,386 being the early incentive bonus received by Mr. Studerus (it is unclear why both numbers are not $75,000). Given that the collapse of the RRSP occurred over two years – 2010 and 2011, that income should be included in those two years. Accordingly, for 2009 the amount shown as an RRSP deduction should be deducted from Mr. Studerus’ line 150 income as should the pension income from Ford. The net result is $39,931 and this is the amount that should be used for Mr. Studerus’ income. However, the SSAG calculations show an income of $67,299. It appears that this figure may include the Ford pension, however, there is no information showing how this number is arrived at. The income for Ms. Studerus is correctly shown at $31,494. Using the SSAGs provided for 2009, but changing Mr. Studerus’ income to $39,931 and showing the cohabitation at 20 years produces SSAG ranges of $211-$246-$281.
[150] For 2009, I fix the monthly spousal support at $250, for an annual equivalent of $3,000.
[151] For 2010, Mr. Studerus had line 150 income of $121,261. This includes the voucher ($35,000) and RRSP income ($38,600). The Ford pension is shown as $38,527 and should be deducted. The income to be used for Mr. Studerus is therefore $82,734. The amount used in the SSAGs is $82,324 (a negligible discrepancy). The income for Ms. Studerus is correctly shown as $33,062. The SSAG ranges are $1,355-$1,580-$1,806.
[152] For 2010, I fix the monthly spousal support at $1,500, for an annual equivalent of $18,000.
[153] For 2011, Mr. Studerus’ line 150 income is in the amount of $84,493. This includes RRSP income ($36,654) and the Ford pension ($38,527). The latter should be deducted and the income for spousal support is $45,966. The amount used in the SSAG calculations is $47,874. It is unclear how this amount was calculated and I have taken the income discrepancy into account. The income for Ms. Studerus is $34,103 but the SSAGs used $34,050 (again, a negligible disparity). The SSAG ranges shown are $397-$464-$530. This calculation uses 23 years as length of cohabitation to further increase the disparity.
[154] For 2011, I fix the monthly spousal support at $350,for an annual equivalent of $4,200.
[155] The total spousal support arrears, as calculated above for the years 2006 to 2011, total $89,400.
[156] The amount of spousal support to be paid by Mr. Studerus to Ms. Studerus therefore is 80 percent of the difference between $89,400 and all the payments made pursuant to the interim order. (The 80 percent provision reflects a 20 percent reduction, due to the support payments not being taxable or tax deductible.)
[157] Assuming that all interim support payments have been made since the date of the order, these payments would total (to July 31, 2013): $5,250 (for 2009), $27,000 ($9,000 for each of the years 2010, 2011, 2012) and $5,250 for 2013, for a total of $37,500. The difference between that amount and total support payments due is $51,900 and 80 percent of the difference is $41,520 and this would be the amount owing by Mr. Studerus to Ms. Studerus. I will leave it to counsel to work out the lump sum spousal support payment if all the interim support payments have not in fact been made.
[158] Counsel shall have an opportunity to make further submissions as to how the spousal support arrears should be paid on a final basis. This will be determined at the same time as the issue of how the equalization payment will be paid. However, in the interim, payment on account of spousal support arrears shall be made as set out below.
[159] Effective July 31, 2013, the interim spousal support order of Rady J. dated June 1, 2009 is vacated and, instead, Mr. Studerus shall pay to Ms. Studerus on account of spousal support arrears the sum of $750 per month, commencing August 1, 2013 and continuing monthly thereafter, until the issue of the payment of the spousal support arrears is dealt with on a final basis.
[160] Given the current income of Mr. Studerus and his lack of liquid assets, I decline to order pre-judgment interest on the spousal support arrears.
CONCLUSION
[161] A final order shall issue in relation to equalization payment and other property issues, and spousal support and child support consistent with these reasons. The order shall specify that child support and spousal support have been dealt with under the Divorce Act.
[162] The order shall be temporary in relation to the ongoing payments of spousal support arrears in the amount of $750 per month pending the final determination as to how spousal support arrears should be paid.
[163] The trial coordinator forthwith shall schedule the continuation of this matter before me to deal with the following issues:
a) determination as to how and when the equalization payment owing by Mr. Studerus shall be paid; and
b) determination on a final basis as to when Mr. Studerus shall pay the spousal support arrears.
[164] In relation to costs, the parties shall provide written submissions to the trial coordinator. Ms. Studerus shall provide her submissions within three weeks, Mr. Studerus shall have two weeks to respond and Ms. Studerus shall have one week thereafter to provide a reply, if any. The written submissions are not to exceed five pages each plus copies of any time dockets, offers and authorities.
[165] Regarding the costs submissions, I find it is appropriate to defer the filing of those submissions until after the issues of payment of the equalization payment and spousal support arrears have been resolved. Accordingly, the time to file the costs submissions shall start to run on the date that a decision is released on the remaining outstanding issues.
[166] I may be spoken to, at a time to be arranged by the trial coordinator, if counsel have any issues regarding the form and content of the order, or to address any arithmetic errors that may be contained in the above reasons.
- Correction made: April 24, 2014 – para. 30, line 2, “2010” changed to “1988”.
“Justice Victor Mitrow”
Justice Victor Mitrow
Released: July 30, 2013
COURT FILE NO.: FD1876/07
DATE: July 30, 2013
ONTARIO
SUPERIOR COURT OF JUSTICE
FAMILY COURT
BETWEEN:
Ruthanne Winnifred Studerus
Applicant
- and -
Thomas Milton Studerus
Respondent
REASONS FOR JUDGMENT
MITROW J.
Released: July 30, 2013