COURT FILE NO: FS-10-359307
DATE: 20130225
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
JOHN RICHARDSON
Applicant
- and -
DEBORAH LORD
Respondent
Melanie Sager,
for the Applicant (for final submissions only, otherwise the Applicant on his own behalf)
H. Niman & K. Rajczak,
for the Respondent
HEARD: November 26 & 30, December 4, 10, & 14, 2012
WHITAKER J.:
WHAT IS THIS CASE ABOUT?
[1] The applicant husband asks to set aside six separation agreements made between 1999 and 2007. He also seeks spousal support and an equalization payment. This application was brought eleven years after the first agreement was signed.
[2] The applicant argues that he was pressured and coerced by the respondent wife into signing the separation agreements, that he did not understand the nature and consequences of signing these agreements at the time, that the agreements are unconscionable and inconsistent with the provisions of the Divorce Act R.S.C. 1985, c.3 (the “Act”).
[3] The respondent takes the position that the six agreements were freely entered into by the parties either with the benefit of independent legal advice or an express waiver of such advice. The respondent submits the agreements are fair, reasonable, consistent with the Act and within the normative range of outcomes for cases in similar circumstances. The respondent suggests these agreements should appropriately govern the parties’ mutual obligations. The respondent argues that the husband has failed to lead any probative evidence in support of his position, that the applicant’s claim of being controlled by the respondent is incredible and there is no basis to set the agreements aside.
[4] For reasons which follow, the application is dismissed.
WHAT HAPPENED?
The Relationship
[5] The respondent testified on his own behalf and read into the record portions of the transcript of the respondent’s questioning. The respondent did not testify.
[6] The parties met and began to date while in high school in 1968. They married on July 23, 1971 and separated in 1999/2000. They are now in their early 60s.
[7] The applicant is in a new common law relationship, which began in 2007. He has two spousal agreements with his present spouse, the first negotiated before the last agreement was negotiated with the respondent.
[8] For the entirety of his working life, the applicant was a science teacher - with the Toronto and the Scarborough School Boards.
[9] With very few and brief exceptional periods, the respondent did not work outside the home. She was and remains completely financially dependent on the applicant.
[10] The only matrimonial assets were the home and the applicant’s pension.
[11] From the outset and as teenagers, the parties had a fractious relationship. They had chronic difficulties managing their finances and their relationship. Each accused the other of having a variety of affairs. As it turned out, both were correct in their suspicions.
[12] The applicant maintains the respondent micromanaged all aspects of life and exercised a general power of control over him. He stated in evidence that “listening to her made me internalize her beliefs” and that she “exerted complete control and dominated me”.
[13] According to the applicant, the respondent was intelligent and manipulative. Although not using the term, he describes having fallen under her “spell.” By his account he was rendered unable to think for himself independently or to identify and/or act in his own interests.
[14] The applicant claimed that this dynamic of control and power arose from the beginning.
[15] It was the respondent who proposed marriage. The applicant now says that he agreed with the suggestion of marriage because he felt trapped with wedding plans and showers. In his view, he had to comply and had no choice – even though he knew at the time that this marriage was wrong for him.
[16] The applicant claims that the respondent controlled his every day, moment to moment activities. At the beginning of each day she would give him lists of things to do while at work. If she assigned him a task that required speaking to some person, she would write out scripts for him to repeat when interacting with others – and he would be expected to adhere to her detailed instructions. All this was to be done on top of his full time teaching duties - while she remained at home and unoccupied.
[17] The applicant warned that while a casual observer might think the respondent presents as lacking in confidence, she was indeed a “tiger” and he could not stand up to her.
[18] The parties purchased the matrimonial home on June 1, 1989.
[19] The applicant claims they separated in September 1999. The respondent maintains that separation occurred on July 19, 2000.
The Six Agreements
[20] The parties negotiated the first of the six agreements on April 5, 1999 while still cohabiting. In March of that year, the applicant was having difficulty managing his personal debt. The first agreement was to assist him in this regard. This brief one page agreement provided for the respondent to pay the applicant $32,905.89 in cash and for him to use these funds to pay his personal debts. In return the applicant agreed to assume the mortgage on the matrimonial home then at $66,000. The agreement indicates that it is a formalization of a verbal agreement made by the parties on March 2, 1997.
[21] As indicated earlier, the applicant asserts the parties separated in September of 1999, shortly after the first agreement. The respondent asserts the parties separated on July 19, 2000 when the applicant stopped providing funds to her and removed her from his credit card.
[22] In August of 2000, the respondent retained counsel to negotiate another separation agreement. The applicant retained counsel and the parties made an effort to negotiate an agreement with the assistance of counsel.
[23] On July 17, 2001 still without a separation agreement, the respondent petitioned for divorce, spousal support and an unequal division of family property.
[24] In August of 2001 the applicant moved out of the home. In January of 2002 the applicant began to pay spousal support of $500 per week. This continued until the respondent began to receive a portion of the applicant’s pension in July of 2010.
[25] In February of 2002, the applicant retained new counsel. From the spring of 2002 until April of 2004 the parties attempted to negotiate a separation agreement with counsel retained by the applicant. Near the end of this period, the applicant began his relationship with his present common law spouse.
[26] On April 1, 2004 the parties entered into the second agreement. This brief three page agreement permitted the applicant to increase the mortgage to pay for his debt, including property tax arrears. The parties agreed that the mortgage would not form part of their Net Family Property calculations. The agreement was prepared under instructions from the applicant to his counsel. The applicant agreed to protect the respondent from any arising liability.
[27] The third agreement was made after the applicant entered into a cohabitation agreement with his common law spouse (this being undisclosed to the respondent at the time).
[28] The third agreement dealt with the matrimonial home and the fourth agreement dealt with pension and support. These were signed on November 23, 2005 and the parties used one lawyer to draft the agreements. The parties both signed Independent Legal Advice (“ILA”) waivers.
[29] Under the third agreement, the respondent was to have exclusive possession of the home until sale and would pay all home services. The applicant was to pay property tax and insurance on two vehicles, outdoor gardening and work, that the net proceeds of the sale of the house were to be split, that the respondent would discharge a mortgage on the home and the applicant would pay any property taxes.
[30] The fourth agreement provided that the respondent would continue to get $500 per week until the sale of the matrimonial home and then half of the applicant’s gross income after the sale of the house and following certain deductions. The parties agreed to terms dealing with the split in income after the applicant’s retirement.
[31] On February 22, 2007, the applicant’s remaining interest in the home was transferred to the respondent, presumably in anticipation of the applicant’s petition for bankruptcy. On March 12, 2007 the parties entered into the fifth and sixth agreements assisted by one counsel and with a waiver of ILA. One agreement dealt with the home and the other with pension and support.
[32] On September 12, 2007, the applicant declared bankruptcy. Three months later and on December 10, 2007, the applicant signed a second cohabitation agreement with his new spouse which acknowledged that he had no interest in the matrimonial home.
[33] This application was filed on May 13, 2010.
[34] On July 1, 2010, the applicant retired.
WHAT ARE THE APPLICABLE PRINCIPLES OF LAW?
[35] The parties agree that the principles of law to be applied here are those set out by the Supreme Court of Canada in Miglin v. Miglin 2003 SCC 24.
[36] Miglin stands for the proposition that the court may exercise a discretion to vary or set aside an agreement of the parties as to spousal support, in exceptional circumstances. The applicant bears a high evidentiary burden and must persuade the court that the agreement is inconsistent with the principles and purposes of the Act.
[37] Miglin contemplates a two step inquiry; an examination of the circumstances at the time of the formation of the contract, and secondly an examination at the time of the application.
[38] Although the respondent in this case argued that Miglin did not apply to the pension income received by the respondent, the issue of whether it applies need not be decided for purposes of this case.
[39] At paragraphs 81 to 83 the court discusses the principles to rely upon where reviewing the circumstances of execution. Firstly that the test is not unconscionability; secondly that there should not be a presumption of vulnerability in the absence of particular evidence to this effect, and thirdly, the court should be “loathe” to interfere.
[40] With respect to the circumstances at the time of the application, the question is whether the agreements reflect an equitable sharing of the consequences of marriage breakdown and as contemplated by the Act (paragraphs 87 to 91 of Miglin).
[41] To set the contract aside, the court must be persuaded that the outcome is a significant departure from the general objectives of the Act, viewed in their entirety:
… Parties must take responsibility for the contract they execute as well as for their own lives. It is only where the current circumstances represent a significant departure from the range of reasonable outcomes anticipated by the parties, in a manner that puts them at odds with the objectives of the Act, that the court may be persuaded to give the agreement little weight.
HOW DOES THE LAW APPLY HERE?
[42] The principle difficulty facing the applicant here - as already indicated - is the absence of any evidence surrounding the negotiation process by which the six agreements were made. Further, there is a lack of any evidence which would support the conclusion that the agreements reflect the vulnerability of the applicant and are inconsistent with the objectives of the Act.
[43] The applicant led no evidence surrounding the circumstances of signing the agreements, nor any evidence dealing with a change in circumstances. To the extent that the applicant put some evidence of this sort before me by reading into the record portions of the respondent’s questioning, this evidence assisted the respondent and not the applicant.
[44] The only evidence led by the applicant was in support of his theory that the respondent exercised a general power of control over him in all aspects of his life. There is an absence of any evidence which reveals or reflects the operation of this power in the context of the particular agreements. I do not find the applicant to be credible on this point.
[45] The applicant did not in his evidence discuss or address the content of any of the six agreements or explain why they should be set aside in the circumstances. There was no evidence to address or explain how the operation of these agreements could amount to consequences for the applicant which might be inconsistent with the provisions of the Act.
[46] Indeed, the applicant closed his case without putting the agreements into evidence and was subsequently granted leave to file them over the objection of the respondent.
[47] There was no evidence as to whether there was in fact, independent legal advice. The agreements note that the parties either obtained independent legal advice or waived the right to seek such advice.
[48] The applicant declared personal bankruptcy, relying in part on the last of the six agreements.
[49] The applicant called no evidence to explain how the contracts were inconsistent with the Act or are a product of vulnerability on the applicant’s part. Having reviewed the terms of these agreements, I conclude the provisions fall within the range of normative outcomes. While there is no doubt that either party could have negotiated better terms for particular claims resolved by the agreements, that is not the test. These six agreements represent the product of negotiation and compromise, over a period of eight years and with the occasional support of counsel.
[50] The applicant has failed to demonstrate that the agreements should not continue to govern the parties’ current obligations to each other.
[51] Put bluntly, I do not accept the applicant’s thesis that he was a mere automaton, unable to act on his own behalf, slavishly under the control of the respondent – able to do nothing except give away his entitlements. On the contrary, I found the applicant to be an astute and capable thinker, clearly competent to understand and articulate his interests and position.
[52] There is a glaring insufficiency of evidence in support of the applicant’s position. There is no basis to set aside the 6 agreements, or to change the spousal support.
OUTCOME
[53] The application is dismissed. Unless parties can agree on costs, written submissions are to be made within 15 days.
WHITAKER, J.
DATE: February 27, 2013
COURT FILE NO: FS-10-359307
DATE: 20130227
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
JOHN RICHARDSON
Applicant
- and -
DEBORAH LORD
Respondent
JUDGMENT
WHITAKER J.
Released: February 27, 2013