ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: FS-12-5224-00
DATE: September 23, 2013
B E T W E E N:
Jennifer Lyn Mason
Tyler Johnson, for the Applicant
Applicant
- and -
Daniel Mark Mason
Matthew Villeneuve, for the Respondent
Respondent
HEARD: August 28, 2013,
at Thunder Bay, Ontario
Regional Senior Justice H.M. Pierce
Reasons on Motion for Child and Spousal Support
[1] The principal issues for determination are the father’s access and his income for the purposes of child and spousal support.
[2] The parties cohabited from 2002, later marrying. They separated on February 15, 2012. The Masons are the parents of two children, Marina Lyn Mason, born August 16, 2005 (8) and Shellsea Autumn Mason, born October 22, 2010 (2). Shellsea is not in school. The father remained in the matrimonial home at separation; the mother now lives with a new partner in a three-bedroom home. At the motion, the parties consented to an order for joint custody.
Access
[3] When the father was 17 years old, he was severely injured in a motor vehicle accident that left him paralyzed from the waist down and with compromised functioning of his upper arms and hands. He was unable to work thereafter but supported himself and the family on his income from a structured settlement, about which more will be said later.
[4] The mother says she has been the primary caregiver for the children. This assertion is not in keeping with the history of the children’s care since separation. From February to June, 2012, Marina divided her time equally between her parents’ homes. During this period, Shellsea spent time with her father but had her primary residence with her mother. From June, 2012 to January, 2013, both children divided their time equally between the parents’ homes. Mr. Mason was assisted by a live-in caregiver who helped with child care that he was physically unable to perform. There is no complaint about the care of the children under this arrangement.
[5] From January to July, 2013, Mr. Mason was hospitalized. Ms. Mason brought the children to see him in hospital and at his home when he was allowed day passes from hospital. I find, however, that during this period of time, the mother assumed full-time care of the children.
[6] Upon his release from hospital in July, the father again arranged for help with care of the children, although he always assumed responsibility for their care. During the summer, he hired students to help him; he also had assistance from a family member.
[7] The father resumed contact with the children upon his release from hospital as follows:
• July 1, 2013: the father had a hospital pass and both children stayed with him overnight;
• July 3, 2013: the father was discharged from hospital;
• July 5 – 7, 2013: both children stayed with their father;
• July 14 – 21, 2013: both children stayed with the father;
• Since July 21, 2013, the children have stayed with their father in alternate weeks.
[8] The mother does not dispute this chronology. The father says it shows the parents’ renewed agreement to share the children’s care as they did before he was hospitalized. The father arranged for the mother to have birthday time with Marina. Apart from her concern about multiple caregivers during the summer, the mother has not complained about the quality of care provided by the father. In the fall, the father plans to have a consistent caregiver as he did before he was hospitalized.
[9] Since both parents are equally available to the children, the father argues that the goal of the court should be to maximize the children’s time with their parents. He also submits that if the mother was not burdened with full-time child care, she would have some time available in order to work.
[10] I agree with the father’s submission that the status quo for Marina’s care was shared care. Now that Shellsea is nearly three, there is no reason why she should not accompany her older sister when her father cares for Marina. There is no evidence that the children have failed to adapt to this regime of care over the summer or that the quality of care is not appropriate. There is no evidence that it is not in the best interests of the children to have equal time with their parents. The father has demonstrated his willingness to accommodate special days, such as birthdays. The parents have agreed to joint decision-making in the form of a joint custody order.
[11] An interim order shall issue that the children reside with each parent in alternate weeks or as the parties otherwise agree. The parents shall divide holiday times and special days with the children equally.
The Father’s Income
[12] The father is 48; the mother, 30. The father’s financial statement deposes that his income for 2013 will be $117,415.68. All but $1,700 of this income is derived from a structured settlement attributable to his accident.
[13] Mr. Mason’s tort claim was decided in the British Columbia Supreme Court and is reported at Mason v. Mason 1988 3152 (BC SC), 31 B.C.L.R. (2d) 92; 1988 3152 (BC SC). The trial judgment given September 21, 1988, assessed damages as follows:
General damages for injuries for loss of amenities of life $ 191,000
Loss of income to date of trial $ 110,000
Loss of earning capacity $ 600,000
Out-of-pocket expenses $ 1,975
Care given by Mr. Albert Drinkwalter $ 21,065
Cost of future care:
Initial outlays $ 73,000
Costs thereafter $ 530,000 $ 603,000
Allowance for taxation $ 200,000
Management fee $ 60,000
Cost of hospital care in Alberta $ 30,000
Total $1,817,040
[14] The judgment was appealed by all parties. The appeals were settled pursuant to a written agreement which provided for a structured settlement with the Insurance Corporation of British Columbia paying $107,311.70 and the Province paying $867,073.98 plus costs. The agreement set out the terms of the structured settlement but did not break down the basis for individual heads of damage as does the judgment.
[15] The mother submits that the father’s income for 2013 should be set at $120,342, grossed up to $187,036 to account for tax. She also states that he will receive a lump sum of $135,000 in 2014.
[16] The mother argues that the family relied on the whole of the father’s income from the structured settlement to support their lifestyle and thus, his income should not be reduced for purposes of calculating support. She also points to a lump sum that the father is entitled to receive every five years.
[17] Ms. Mason submits that the father should pay child support of $2,434 per month. These calculations are based on the mother having full-time care of the children, which is not the order I have made on an interim basis.
[18] The father submits that, based on the reasoning in M.K. v. R.A.S., 2004 BCSC 1798, annuity payments from a damages award are not caught by ss. 19(1)(b) or 19(1)(h) of the Child Support Guidelines: paras. 36 – 37. In M.K., the court held that the portion of the damages award attributable to loss of earning capacity is properly considered to be income within the meaning of the Guidelines. The court also held that costs for future care related to his needs arising from the accident are personal to the recipient and should not be imputed to him as income under the Guidelines: paras. 33 – 35. The court declined to gross up the income available for child support to reflect that the income is received without tax.
[19] In Fequet v. Fequet, 2008 30284 (ONSC), para. 39, the court held that
…identifiable and reasonable general damages for loss of enjoyment of life and/or damages for future care costs should not be included for the purpose of spousal or child support calculations.
However, the court cautioned that it can examine how the funds received are being used by the recipient in determining income: para. 35. The income in Fequet was grossed up to reflect tax.
[20] The father’s position is that his entire income should not be included for purposes of assessing his liability for child support, but only the portion attributable to lost earnings. He submits that a portion of his monthly annuity is needed for ongoing medical needs. He is now 48 years old. He will never work. Mr. Mason’s financial statement discloses expenses for an elevator ($100 per month); a nanny ($1,500 per month); drugs ($170 per month); and medical supplies and equipment, including wheelchair replacement ($500 per month). He deposes that he also has capital expenses to accommodate his medical condition, such as the purchase of a van with a lift at an estimated cost of $60,000. In addition, the father will need income to support the children when they are in his care.
[21] I conclude that while the numbers in the settlement may differ from the judgment, the nature of the compensation is likely to be similar. I therefore deem that the father’s compensation for loss of earning capacity represents 1/3 of his award. I also take into account that, notwithstanding provision for the payment of costs, the costs award was unlikely to have fully indemnified the father for his legal fees.
[22] I find that the father’s income for purposes of child support is 1/3 x $117,415 = $39,099. When grossed up by 18% to allow for tax, the father’s income becomes $46,137 for purposes of child support.
Child Support
[23] The father submits that income of $21,000 should be imputed to the mother based on income for a minimum wage job because she has the time to earn income when the children are in his care. He submits that his obligation to support the children should be offset against her obligation and capacity to support them as well. The mother did attempt to work following the parties’ separation, but could not keep up with the demands of child care without transportation. The mother is not currently working and did not work outside the home during marriage.
[24] In my view, the mother is not intentionally unemployed; her circumstances are a response to the necessity of assuming full-time child care while the father was hospitalized for some seven months. Shellsea is not yet three. While the mother may be able to assume employment in the future, the court must assess her capacity to support the children based on current circumstances. In my view, it would be unreasonable to impute income to the mother at this stage, beyond the income of $1,200 set out in her spousal support calculation.
[25] The father has sufficient income that he can pay child support without a set-off contribution by the mother. He is therefore ordered to pay child support for the two children of $682 per month, commencing September 1, 2013.
Spousal Support
[26] The mother seeks spousal support in the mid-range of $2,937 per month retroactive to the date of separation. She contends that the father has surplus income when his expenses are paid and that she needs this support. The spousal support calculation is based on her employment income of $1,200 per year. Her current partner contributes $960 per month towards household expenses, leaving her with a deficit of $1,534 per month. This deficit includes an expense for $250 per month for savings and contemplates full-time care of the children.
[27] The mother wishes to continue her education. She completed her high school equivalency following separation. As she is just 30, this may be a realistic plan that allows her to contribute to the children’s support, as well as her own, in the longer term. The father has surplus income such that he can afford to pay spousal support.
[28] The father has been making voluntary payments of about $2,000 per month. These were not broken down as between child and spousal support. He says he has been over-paying.
[29] The application was not commenced until November 2012. The issue of retroactivity shall be left to the trial judge who can determine the timeliness of any payments made and whether they were sufficient.
[30] The father shall pay to the mother spousal support of $855 per month commencing September 1, 2013, without prejudice to the mother’s claims for retroactive spousal support from the date of separation. This represents the mid-point of the Spousal Support Advisory Guidelines, based on the foregoing assumptions.
Costs
[31] If the parties cannot agree on costs within thirty days, they may obtain an appointment from the trial coordinator at Kenora to argue same, with leave to counsel to appear by teleconference, if so advised. If no appointment is applied for within thirty days, costs will be deemed to be settled. Costs submissions are not to exceed five pages.
“original signed by RSJ Pierce”
Regional Senior Justice H.M. Pierce
Released: September 23, 2013
COURT FILE NO.: FS-12-5224-00
DATE: September 23, 2013
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
Jennifer Lyn Mason
Applicant
- and –
Daniel Mark Mason
Respondent
REASONS ON MOTION FOR CHILD AND SPOUSAL SUPPORT
Pierce, RSJ
Released: September 23, 2013
/ket