SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: 214/03

DATE: 2013-01-23

RE: IWONA LOTKO, Applicant

AND:

JAROSLAW LOTKO, Respondent

BEFORE: MURRAY J.

COUNSEL:
Stephen Durbin, Counsel for the Applicant

Novalea Jarvis, Counsel for the Respondent

HEARD: December 10, 2012

ENDORSEMENT

[1] The applicant brought a motion to change the order of Mr. Justice Langdon made on October 9, 2003 and, in addition, sought retroactive child support payments based on an application of the Guidelines retroactive to January 1, 2007. Eventually, the claim for retroactivity was reduced to a claim for Guideline support retroactive to June, 2011 when this application for change of the order of Mr. Justice Langdon was initiated. She also made a claim for section 7 expenses allegedly owed by the respondent.

[2] Prior to the conclusion of this case, the parties advised the Court that they had reached a resolution of matters in dispute. In fairness to the parties, this agreement was reached after I indicated to both parties that I had great difficulty understanding what material change in circumstances existed which would warrant a change in the order made by Mr. justice Langdon on October 9, 2003.

[3] The parties asked if I would, notwithstanding their agreement, provide brief reasons with respect to the issue of material change in circumstances. I agreed to do so and they are set out below.

Background Information

[4] The parties were married in July 1982.

[5] There are three children of the marriage: Chris Adrian Lotko born on November 26, 1983; Nicole Olivia Lotko born on January 30, 1992; and Carolyn Jessica Lotko born on January 20, 1995. Pursuant to the consent order of Mr. Justice Langdon on October 9, 2003, the parties have joint custody of the two younger children. Both daughters have principal residence with the applicant, with the respondent exercising access on a regular basis. Nicole is an undergraduate at McMaster University and Caroline is in high school. The oldest son, Chris, is married and has three children and Chris's family reside with the respondent who assists them financially.

[6] The parties separated in November of 1998 and were divorced on February 13, 2002. After separation, all three children resided with the respondent until October of 2003 when the parties agreed that the two daughters, Nicole and Carolyn, would reside with the applicant. The applicant did not pay child support to the respondent when all three children resided with him.

[7] Nicole and Carolyn are both described by their parents as good students and as accomplished and intelligent young women who work hard at school and who are excellent students. Both daughters are gainfully employed as well as being good students. Both earn reasonable incomes working part-time during the school year and full-time during the summer. In 2011, Nicole earned approximately $13,000 through her employment and expects to earn approximately the same amount in 2012. Carolyn, who is still in high school, earned approximately $8,000 in 2011 and anticipates earning approximately the same amount in 2012. Nicole and Carolyn are both to be admired for their accomplishments, both in and out of school. They appear to be extraordinary young women.

[8] A comprehensive settlement was reached by the parties in 2003 and made the subject of a final consent order by Mr. Justice Langdon. Both parties were represented by lawyers and were in receipt of independent legal advice. As noted, the order sought to be changed was made on consent.

[9] Paragraphs 7 and 8 of the order of Mr. Justice Langdon made on October 9, 2003 provides as follows:

The parties both work for the Ford Motor Company at Oakville, Ontario. The mother's annual salary is $62,152 and the father's annual salary is $68,963. Both salaries are based on the parties being paid for a 52 week year. However, because of the recent plant shutdowns at the Ford plant the parties agree that the father will pay child support for the two children in the amount of $700 commencing April 1, 2003.

The parties agree that when the father returns to a 10 hour a day shift (48 hours per week) he will pay to the mother for child support for the two children the amount of $850 per month. The amount of $850 per month may in the future be less than the table amount of child support however the parties have considered the possibilities of plant shutdowns at the Ford Motor Company and further that the respondent is paying some of the costs of the children's clothing and school supplies.

[10] Since 2007, the respondent's line 150 income has been: $98,177 in 2007, $103,128 in 2008, $99,908 in 2009 and $102,929 in 2010. His income for 2011 was $98,700 and for 2012 is estimated to be approximately the same as in 2011. During the course of the proceedings it became clear that the respondent has returned to the 48 hour week on a regular basis and has not increased his child support payments to the $850 per month required by the order of Mr. Justice Langdon.

[11] Since the date of the consent order in 2003, the respondent’s evidence is that he has spent significant sums on his two daughters, including providing monthly allowances to them. The monthly allowances paid by the respondent amount to $200 per month. Perhaps understandably, he has not kept track of all sums paid in addition to child support and allowances but it is clear from the evidence that he has spent thousands of dollars for the two girls in addition to paying $700 per month in spousal support. Some of these payments include contribution to Nicole's post-secondary education in the amount of $5,500 in 2011/2012, $400 per child for drivers education, and the purchase for the two girls a variety of larger items, including laptops, iPods, DVD players, television, jewellery, clothing, school uniforms, sporting equipment, cell phones, and numerous other items. The respondent estimates that he has spent about $3,600 per annum on items of clothing and other smaller purchases since 2003. In view of the fact that the respondent has not kept track of his expenses, it is difficult if not impossible for him to determine accurately the amount of money paid to or on behalf of his two daughters in addition to the $700 per month paid to the applicant. His failure to keep records is perhaps understandable in circumstances where he was not aware of any dispute with the applicant regarding the amount of child support payable.

Analysis

[12] I begin with the observation that the Divorce Act, R.S.C., 1985, c. 3 in s. 15.1 (7) provides that a court of competent jurisdiction may award an amount that is different from the amount that would be determined in accordance with the applicable guidelines on the consent of both spouses if it is satisfied that reasonable arrangements have been made for the support of the child to whom the order relates. Subsection 15.1 (8) provides that: “for the purposes of subsection (7), in determining whether reasonable arrangements have been made for the support of a child, the court shall have regard to the applicable guidelines. However, the court shall not consider the arrangements to be unreasonable solely because the amount of support agreed to is not the same as the amount that would otherwise have been determined in accordance with the applicable guidelines”. In the case at bar, the parties clearly consented to an amount of child support which was not determined in accordance with the Guidelines and specified such agreement in the consent order. It is also reasonable to conclude that Mr. Justice Langdon was satisfied that reasonable arrangements were made for the support of the children to whom the order related. Although Justice Langdon was not required to and did not provide reasons for concluding that the arrangements made were reasonable, a consideration of some of the surrounding facts may shed some light on what informed the parties’ consent order and Justice Langdon's willingness to grant such an order.

[13] When the parties executed the agreement which was incorporated into the final order of Mr. Justice Langdon, the stability of the automobile industry was uncertain as were their future employment prospects. The respondent was working reduced hours. Neither party could anticipate a steady income stream from their employer for 52 weeks a year. It was in this environment that the respondent guaranteed payments of $700 per month in child support payments regardless of whether there would be intermittent periods of unemployment due to layoff. The parties stipulated an additional $150 per month would be paid by the respondent when he returned to a 10 hour shift (10 hours per shift from Monday to Thursday and 8 hours on Saturday). The respondent agreed to spend additional monies on his two daughters over and above the monthly payments stipulated payable by him to the applicant mother. His affidavit material indicates that at the time of the consent order, he was concerned about the applicant’s spending habits and that he wanted to benefit his daughters directly by paying for clothing, school supplies and other things that might well be purchased by the applicant using Guideline support payments if she were to receive them. Regardless of the reasonableness of these underlying concerns of the respondent, it was also potentially in the applicant's interest to have a guaranteed payment.

[14] In sum, it is plain that the parties understood that the actual child support payment made by the respondent to the applicant would be less than required by the Guidelines. It is also clear that the expectation of the parties was that the respondent would pay directly for items that would otherwise be paid from child support payments made at the Guidelines level.

[15] It is evident that the parties were aware of the potential for the respondent to make additional money working overtime hours. In fact, a 48 hour work week by definition generates a minimum of 8 hours of overtime per week which on an annual basis would result in approximately 400 hours of overtime. There was always a possibility of working more overtime. Both parties work at the Ford Motor Company and both are covered by the same collective agreement and have familiarity with the terms and conditions of work at that location. The respondent's job is the same as it was in 2003. Therefore, the fact that the income of the respondent has increased (mostly due to working overtime) is not a change of circumstances. Both he and the applicant have received wage increases negotiated by the CAW on their behalf over the years. The wage increases negotiated through collective bargaining were anticipated by both parties as was the potential for both parties to work overtime.

[16] With respect, in my view, the applicant has failed to show material change in circumstances since the last order was made. In Litman v. Sherman, 2008 ONCA 485, the Court of Appeal confirmed the necessity to find a material change in circumstances. Relying on Gordon v. Goertz, 1996 191 (SCC), [1996] 2 S.C.R. 27, the Court of Appeal held that before a Court can consider the merits of an application for variation it must be satisfied that there has been a change in the condition, means, needs or circumstances of the child, which materially affects the child and which was either not foreseen or could not have been reasonably contemplated by the judge who made the initial order. The applicant has not demonstrated any change which would warrant a variation of the order of Mr. Justice Langdon made on consent of the parties in 2003.

[17] It would also be grossly unfair to require the respondent to pay retroactive child support in accordance with the Guidelines in circumstances where he has spent substantial monies in addition to the child support paid to the applicant in accordance with the consent order.

Conclusion

[18] The applicant has failed to show a change in circumstances warranting a variation to the consent order made by Mr. Justice Langdon in 2003. Her motion to change is, therefore, dismissed.

[19] The respondent agreed to pay $2,500 in retroactive child support based on the fact that he is now regularly working a 48 hour work thus conceding that his obligation to pay $850 per month was triggered prior to the return of the applicant's motion to change. In addition, the respondent agreed that commencing January 1, 2013 he will pay $850 per month on January 1, 2013 and $850 monthly thereafter until further order of this Court or agreement by the parties.

[20] This ruling is premised on the expectation that the respondent will continue to contribute towards the costs of clothing and school supplies for Nicole and Carolyn and/or to provide them with allowances for such purposes in addition to the $850 per month of child support paid to the recipient mother. It should be understood that such additional expenditures and payments made by the father - for these purposes - will not be treated as section 7 expenses. The monies that are anticipated to be spent by the respondent on his daughters over and above the $850 a month are not intended to include s. 7 expenses. The fact that section 7 expenses are not included in these additional payments over $850 per month is clear for two reasons: first, the language of the order stipulates that the respondent will continue to contribute towards the costs of clothing and school supplies; and, secondly, the 2003 order of Mr. Justice Langdon provided that the parties are to share extraordinary expenses as defined in the Federal Child Support Guidelines in proportion to their incomes. In short, nothing in this decision should be construed as expanding or limiting the scope of section 7 expenses which are to be shared proportionately by the applicant and the respondent.

[21] Prior to the conclusion of the hearing, the parties agreed to an order requiring disclosure by the applicant to the respondent based on a draft provided to the Court by the applicant. Therefore, I have made an order which is set out below. If this order does not accurately reflect what the parties wish and what was discussed in court, then I may be spoken to.

[22] The parties are in agreement that Nicole and Carolyn shall be responsible for a minimum of 30% of their university/college expenses commencing in January, 2013. They also expressed agreement that any bursaries, scholarships, student loans or other payments made to Nicole and Carolyn shall be counted as part of the contribution made by them in calculating 30%. For purposes of clarification, if bursaries are made available to either daughter through the Ford Motor Company, such bursaries are to count as part of the daughter’s 30% contribution to her post-secondary expenses. The balance of post-secondary expenses are section 7 expenses and are to be shared proportionately by the applicant and respondent in accordance with their incomes.

Decision

[23] This Court makes the following orders:

1. It is ordered that the respondent shall pay to the applicant:

a) $2,500 as retroactive child support (such amount to be paid forthwith);

b) child support for Nicole Olivia Lotko born on January 30, 1992 and Carolyn Jessica Lotko born on January 20, 1995 in the amount of $850 a month commencing on January 1, 2013 and $850 on the first of each and every month thereafter until further order of this Court or agreement of the parties.

2. Commencing in 2013, and thereafter, as long as either Nicole/and or Carolyn are attending college or university, the applicant shall provide to the respondent in a timely manner the following documentation:

a) proof of enrolment in college and/or university;

b) tuition payable and amounts paid by the applicant and by the child;

c) information with respect to the courses taken and the timetable for each child attending college or university indicating dates for the beginning and end of each academic term;

d) copies of report cards and/or transcripts indicating the progress of Nicole and Carolyn at school/college/university;

e) transportation receipts related to expenditures incurred by or on behalf of Nicole and/or Carolyn commuting to college or university;

f) receipts related to expenditures incurred by or on behalf of Nicole and/or Carolyn for the purchase of books;

g) all information with respect to student loans incurred by Nicole and/or Carolyn;

h) all information with respect to any grants, bursaries or scholarships received by Nicole and/or Carolyn; and

i) by June 1st each year, information with respect to the annual income of Nicole and Carolyn including copies of their income tax and notices of assessment.

3. As long as the respondent has an obligation to pay child support to the applicant, the applicant and the respondent shall by no later than June 1st each year, exchange income tax information from the previous year which shall include: copies of their previous years income tax returns and notices of assessment.

4. Section 7 expenses shall be paid by the applicant and the respondent in proportion to their respective incomes after deducting from the expense, the contribution, if any, from the child.

Costs

[24] The parties agreed that there shall be no order for costs and each party will be responsible for his/her own costs.

MURRAY J.

Date: January 23, 2013