ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: FS-13-0038
DATE: 19-August-2013
B E T W E E N:
DANIEL RAYMOND GIBSON
Martha Petryshyn , for the Applicants
Applicant
- and -
JENNIFER ANNE DUNCAN
Unrepresented
Respondent
HEARD: August 15, 2013
at Thunder Bay, Ontario
Mr. Justice D.C. Shaw
Reasons On Motion
[1] This is a motion by the applicant, Daniel Raymond Gibson, for sale of the matrimonial home under the Partition Act, prior to the trial. The respondent, Jennifer Anne Duncan, opposes the motion.
Background
[2] Mr. Gibson is 43 years of age; Ms. Duncan is 45. The parties began residing together in 2000. They were married on August 7, 2004. They separated on October 30, 2012.
[3] Ms. Duncan has two children from a previous relationship – Michael McInnis, age 19, and Cameron McInnis, age 16. Michael is working at Bombardier. Cameron will be entering grade 12 this September.
[4] On separation, Mr. Gibson left the matrimonial home. Ms. Duncan and the two children have resided in the matrimonial home since the date of separation.
[5] Ms. Duncan deposes that Mr. Gibson maintains a meaningful relationship with the children and has been a father figure to them. She says he was very close to the children and more than just a step father. In his application, Mr. Gibson states that he has been a significant part of the children’s lives and that he wishes to continue and maintain his relationship with the children. He deposes that the children have repudiated their relationship with him.
[6] Mr. Gibson is employed as a steam fitter. His financial statement shows an income of $81,000 per year. Ms. Duncan is employed with the RCMP as a criminal intelligence analyst, seconded to Nishnawbe Aski Police Services in Thunder Bay. Her financial statement shows an income of $3666.14 per month from employment plus child support from her former spouse of $1030 per month, for a total annual income of $56,353.68. She deposes that her employment income this year will be $49,000.
[7] On separation, Mr. Gibson moved in with his cousin. Recently, Mr. Gibson began residing with his girlfriend and her two young sons in a single detached home. The day before separating, the parties jointly refinanced the home with a mortgage of $152,000. The principal amount of the mortgage is presently approximately $150,000. It is in good standing. Ms. Duncan deposes that she has arranged for the mortgage payments to come out automatically from her bank account. Mr. Gibson pays $435.00 every two weeks into the parties’ joint cheqing account. The mortgage payments used to be automatically taken by the bank from this account. The $435 per month represents half of the costs of the mortgage and taxes for the matrimonial home.
[8] Ms. Duncan wishes to continue to live in the matrimonial home with the children and, as part of the equalization process, to purchase Mr. Gibson’s interest in the home. Mr. Gibson is prepared to sell his one-half interest to Ms. Duncan. However, the parties have not been able to agree on the value of the home
[9] At the time the new mortgage was placed on the home, the bank had an appraisal of the property done by Mr. Michael Vecchio, an accredited appraiser. The home was appraised at $192,000. The bank will not release a copy of this internal appraisal report.
[10] After separation, Ms. Duncan retained the services of Mr. Timothy Groulx, an accredited appraiser. He valued the home at $130,000.
[11] Mr. Gibson believed that Mr. Groulx significantly undervalued the property. He retained the services of Ms. Susan McCrury, who is also an accredited appraiser. She valued the home at $148,000. On receiving the report, Mr. Gibson questioned its validity based on what he believed were many discrepancies in the report.
[12] Mr. Gibson then retained the services of a real estate agent, Mr. George Ioannedis, to do a “drive-by” valuation. Mr. Ioannedis is not an accredited appraiser. He gave an opinion that the house should be listed for sale for a price between $179,000 and $183,000.
[13] Negotiations on the purchase of Mr. Gibson’s interest in the home have broken down because of the discrepancies in values among the three appraisals and the drive-by opinion. As a result of the parties’ inability to agree on the value of the home, Mr. Gibson wants the home to be sold on the open market.
[14] Ms. Duncan has claimed an order for exclusive possession of the home in her Answer/Claim. She has not brought a motion for interim exclusive possession. She and the children have been in de facto possession of the home since October 30, 2013.
[15] Mr. Gibson disputes the claim for exclusive possession in his Reply but states that he is prepared to have Ms. Duncan retain ownership of the home and contents as long as the appropriate value for these items is attributed to her in the equalization payment.
[16] Ms. Duncan deposes that she does not agree to the sale of the home. She states that she wishes to retain the home for the children for their emotional well-being. She states that her current financial situation does not permit her to live anywhere else. She says she has no savings to buy another home and has no savings to pay for first and last months’ rent. She states that her parents live in a two bedroom home outside of Thunder Bay and that she has no siblings in town. She deposes that the suggestion of selling the family home has caused anxiety and stress to the children and to her. She deposes that she and the children are currently attending family counselling to deal with the psychological impact of the break-up. Ms. Duncan goes into some detail about the emotional and psychological reactions of the children to the situation, including academic struggles and withdrawal from sporting activities. She states that the child Cameron, has expressed concern about the sale of the home.
Discussion
[17] Mr. Gibson’s motion for sale is brought under the Partition Act. Where the property in question is not a matrimonial home, there is a narrow standard for the exercise of the court’s discretion to refuse the prima face right of a joint owner to partition and sale. The sale should only be refused if the application is vexatious, malicious or aggressive. There is no evidence that Mr. Gibson’s motion is vexatious, malicious or aggressive.
[18] However, when the property in question is a matrimonial home, other considerations apply. The Ontario Court of Appeal in Silva v Silva (1991), 1990 6718 (ON CA), 1 O.R. (3d) 436 (C.A.) dealt with the interplay between the Partition Act and the Family Law Act. At para 24, Finlayson J.A. stated:
The two statues are not incompatible, but where substantial rights in relation to jointly owned property are likely to be jeopardized by an order for partition and sale, an application under the Partition Act should be deferred until the matter is decided under the F.L.A. Putting it more broadly, an application under s. 2 (of the Partition Act) should not proceed where it can be shown that it would prejudice the rights of either spouse under the F.L.A.
[19] Section 19(1) of the Family Law Act provides that both spouses have an equal right to possession of the matrimonial home. Section 24(1) of the Family Law Act permits a spouse to make a claim for exclusive possession of the matrimonial home, regardless of ownership and despite section 19.
[20] In Binkley v Binkley, [1988] O.J. no. 414 (C.A.), the Court of Appeal set aside an interlocutory order for an immediate sale of the matrimonial home. The wife, who was residing in the matrimonial home after separation, had claimed an unequal division of assets and a vesting of the home in her name alone. The Court of Appeal found that on the basis of the material filed, the wife had “at least an arguable case” and that the effect of the order under appeal was to substantially impair, if not destroy, the wife’s right to a trial on this issue.
[21] In Martin v Martin, 1992 7402 (ON CA), [1992] O.J. No. 656 (C.A.), the Court of Appeal, citing Binkley, stated at para 24 that orders for the sale of a matrimonial home before the resolution of Family Law Act issues (particularly the determination of the equalization payment) should not be made as a matter of course and that, in addition, spousal rights of possession under s. 19 of the Family Law Act and any order for interim exclusive possession should be taken into account.
[22] In Walters v Walters, [1992] O.J. No. 1324 (Gen. Div.), Wright J. held that the test for whether a matrimonial home should be sold before trial was whether there was “genuine issue for trial.” He observed that a claim for exclusive possession was a substantive property right, determined on the facts as they are shown to exist at trial.
[23] In my opinion, Ms. Duncan’s claim for an order at trial for exclusive possession of the matrimonial home presents at least an arguable case. Her claim is a substantive property right which would be fatally prejudiced if an order was made that the house be sold prior to trial.
[24] Ms. Duncan wants to keep the house as a home for her children. Cameron is going into the final year of high school. This house has been his home since he was three years of age. On the material filed by Ms. Duncan, Cameron is going through emotional turmoil because of the breakdown of the marriage. He has expressed concern that Mr. Gibson wants the home sold. Ms. Duncan deposes that she has no suitable alternative accommodation and that her financial position would not permit her to buy another house or to pay her first and last month’s rent on rental accommodation.
[25] A review of the criteria set out in s. 24(3) and (4) of the Family Law Act, which the court must consider in determining whether to make an order for exclusive possession, satisfies me that Ms. Duncan’s claim raises a genuine issue for trial. The court must consider the best interests of the children, which include possible disruptive effects on the child of a move to other accommodations and the child’s views and preferences. The court must also consider the financial position of both spouses and the availability of other suitable and affordable accommodation. On the material before me and in light of the criteria in s. 24(3) and (4), Ms. Duncan’s claim of meets the threshold of “an arguable case” as set out in Brinkley or the threshold of a “genuine issue for trial” described in Walters.
[26] I also take into consideration the fact that the mortgage on the home is in good standing. A delay in the sale of the home will not risk a foreclosure or a power of sale proceeding. I also take into account that Mr. Gibson is living in another home at this time with his girlfriend and that his income is $81,000 per year. There is no compelling need to immediately realize on his interest in the home so that he can obtain reasonable alternative accommodation.
[27] There is also no certainty, based on the three accredited appraisals, that the home would sell for substantially more than the principal amount of the mortgage of $150,000. The two accredited appraisals that are in the materials, one commissioned by Ms. Duncan and one commissioned by Mr. Gibson, each put the value of the home at less than the principal of the mortgage. The value set out in the third appraisal, $192, 000, is significantly more than the principal of the mortgage, but Mr. Gibson has not been able to file the actual report so that it can be compared to the other two accredited reports. The letter setting out the drive-by opinion of value expressly provides that it is not to be relied upon by anyone other than Mr. Gibson and states that the author has not been admitted in court or other legal proceedings as an expert on appraisals.
[28] For the reasons given, Mr. Gibson’s motion for an interlocutory order to sell the home prior to trial is dismissed. As the successful party, Ms. Duncan is entitled to costs, albeit as an unrepresented party.
[29] If the parties are unable to agree on costs, they shall make arrangements with the Trial Coordinator within 30 days to set a date to speak to the issue.
The Hon. Mr. Justice D.C. Shaw
Released: August 19, 2013
COURT FILE NO.: FS-13-0038
DATE: 19-August-2013
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
DANIEL RAYMOND GIBSON
Applicant
- and –
JENNIFER ANNE DUNCAN
Respondent
REASONS ON MOTION
Shaw J.
Released: August 19, 2013
/nf