COURT FILE NO.: FS-11-17494

DATE: 20131112

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

ISABELLE HEMOND

Applicant

• and -

JOSE ANTONIO CASAL GALANO

Respondent

Dana Cohen, for the Applicant

The Respondent Appearing in Person

HEARD: September 23 to 25, 2013

STEVENSON J.

REASONS FOR DECISION

Introduction

[1] The applicant, Isabelle Hemond ("Ms. Hemond"), issued an Application on July 19, 2011 wherein she was seeking custody of the children, Matteo Antoine Casal ("Matteo") and Tessa Maria Casal ("Tessa"), both born August 26, 2008 with their primary residence to be with her. In the alternative, she was seeking joint custody. She also sought, inter alia, child support in accordance with the Ontario Child Support Guidelines O. Reg. 391/97, as amended (the "Guidelines") and contribution towards the children's special and extraordinary expenses in accordance with section 7 of the Guidelines. In the event of a shared parenting schedule, she sought an order that neither party pay child support to the other.

[2] The respondent, Jose Antonio Casal Galano ("Mr. Casal"), filed an Answer dated September 7, 2011 wherein he sought joint custody of the children with the children sharing their time equally with the parties. In the alternative, he sought sole custody of the children and that Ms. Hemond exercise liberal and generous access. He also sought, inter alia, an order that Ms. Hemond pay child support retroactive to the date of separation and the sharing of the children's section 7 expenses retroactive to the date of separation.

[3] Shortly before trial the parties were able to resolve their parenting issues, ongoing child support and contribution to section 7 expenses by way of Partial Minutes of Settlement dated September 18, 2013. The only outstanding issues for trial were Mr. Casal's claim for child support from January 1, 2011 to September 1, 2013 under section 9 of the Guidelines and an adjustment to the proportionate sharing of the children's daycare expenses for that same period. The issue of the apportionment of payment for the custody and access assessment completed during the proceedings was also to be determined.

Facts

[4] The parties met in approximately April of 2005. They commenced cohabiting in September 2005. During the course of their relationship Ms. Hemond became pregnant, but unfortunately the parties' first child was stillborn. Subsequently after months of fertility treatments, Ms. Hemond became pregnant with twins, Matteo and Tessa. Matteo and Tessa were born prematurely at 29 weeks on August 26, 2008.

[5] The parties struggled in their relationship and subsequently separated in approximately June of 2010 while continuing to reside separate and apart in Ms. Hemond's home. They physically separated on October 23, 2010 after entering into an Interim Parenting Agreement (the "Agreement") dated October 22, 2010.

[6] In the Agreement, the parties agreed to terms on a without prejudice basis. Among the terms was a provision that Mr. Casal was to vacate Ms. Hemond's home by October 23, 2010. The parties agreed to an equal time-sharing schedule with respect to the children. There were provisions for daily telephone calls to the children while in the other parent's care and sharing of holiday time during the Christmas vacation period. Additionally, the parties agreed to share the costs of the children's daycare expenses equally and Mr. Casal was to provide Ms. Hemond with post-dated cheques for his one-half share of the daycare costs for November, December 2010 and January 2011. Mr. Casal was also to pay Ms. Hemond $1,054 for the September 2010 household bill reconciliation, including daycare. The parties were to exchange information regarding the October expense reconciliation period. Mr. Casal was also to pay his 50% portion of the household expenses for October immediately. The parties further agreed that they would review the parenting arrangements on January 15, 2011. The Agreement was silent on child support.

[7] The Agreement was never amended and the parties continued to pay for daycare expenses on an equal basis. Ms. Hemond commenced a court Application on July 19, 2011. She sought a change in the parenting schedule as she felt that the schedule was not in the best interests of Matteo and Tessa. Ms. Hemond contends that the first formal notice she received that Mr. Casal was seeking child support in accordance with section 9 of the Guidelines and a proportionate sharing of section 7 expenses, was when Mr. Casal filed his Answer. Her position is that Mr. Casal is not entitled to any relief given his lack of financial support to the family while he resided in the home when Ms. Hemond was pregnant, after the children were born and after separation. Her position is also that the parties' governed themselves in accordance with the Agreement and as such, no child support was to be paid to one another and daycare costs were shared equally.

[8] Mr. Casal contends that the issues of section 9 and section 7 contributions were always part of the discussions after separation. He contends that Ms. Hemond was well aware that he was seeking these contributions from her, but that she refused to pay child support in accordance with section 9 of the Guidelines and to pay special and extraordinary expenses, specifically daycare, in proportion to the parties' incomes. His position is that Ms. Hemond owes him $42,361.83 for child support and daycare arrears for the period January 1, 2011 to September 1, 2013.

[9] Mr. Casal also seeks to impute income to Ms. Hemond. Ms. Hemond left her employment on May 31, 2012. She contends that she had extremely long working hours with travelling that was affecting her health and her ability to parent. She submits that her employment at the time was not in the children's best interests. Mr. Casal contends that Ms. Hemond terminated her employment intentionally. He submits that income should be imputed to Ms. Hemond for the calendar year 2012.

Issues

[10] The issues for determination are as follows:

i) Should income be imputed to Ms. Hemond for the 2012 calendar year?

ii) Does Ms. Hemond owe $42,361.83 to Mr. Casal which consists of arrears of child support and daycare expenses along with her proportionate sharing of the total costs for the assessment?

Issue #1

(i) Should income be imputed to Ms. Hemond for the 2012 calendar year?

Mr. Casal's Position

[11] Mr. Casal testified that shortly after the parties consented to an order for an assessment with respect to custody and access on April 12, 2012 and they agreed that they would pay for the assessment in proportion to their 2012 incomes, Ms. Hemond quit her employment. Mr. Casal's evidence was that Ms. Hemond intentionally left her employment in May of 2012 and that she remained unemployed for the remainder of the year. He testified that Ms. Hemond did not make efforts to secure alternate employment. He seeks to impute an income of $150,000 gross to Ms. Hemond for the calendar year 2012.

[12] In submissions, Mr. Casal provided calculations for the year 2012 wherein his income was $86,446 gross and he imputes an income to Ms. Hemond of $150,000 gross. It is his position that given Ms. Hemond intentionally quit her employment in 2012, she owes him child support in the total amount of $10,770.69. This includes arrears of child support of $9,144 based on a set-off under section 9 of the Guidelines and $1,626.69 with respect to daycare arrears. This is based on a proportionate sharing with Ms. Hemond paying 63% of the costs of daycare and Mr. Casal paying 37%.

[13] Mr. Casal also testified that Ms. Hemond's income for 2011 was $263,963. He contends that even before she swore her Financial Statement in June of 2011, she was aware in February of 2011 that her income was higher. His evidence was that he and his lawyer had difficulty obtaining financial disclosure and in approximately April of 2012 when the order was made with respect to the assessment, Ms. Hemond indicated that her income was approximately $150,000 gross. Mr. Casal testified that suddenly, after the April 12, 2012 consent order, Ms. Hemond became unemployed when there was to be a proportionate sharing of the assessment costs based on 2012 incomes. To him this also explained why Ms. Hemond did not want shared custody of the children. On cross-examination, Mr. Casal admitted that he did not know Ms. Hemond's reasons for leaving her employment.

Ms. Hemond's Position

[14] Ms. Hemond testified that she agreed to pay the upfront costs for the assessment knowing that she would be reimbursed based on 2012 incomes. She confirmed in her evidence that she earned less than Mr. Casal in 2012, but she is only seeking 50% of the costs for the assessment. She testified that she had not been paid by Mr. Casal for his portion of the assessment costs.

[15] She changed jobs in November 2011 because her former company was sold and there was new management and uncertainty. Her new job would pay her $150,000 gross. She testified that she was to be a Director of Marketing but there was no job description. She was advised that she would have a team, but when she commenced her employment there was no team in place and she had to hire a team. She was also told that she would have limited travel, but she ended up travelling 4 to 6 times a month and working 70 to 80 hours per week. She would get up early in the morning before the children woke in order to work. She would also work late into the evening when the children were asleep. She felt stressed, she had no time for herself and she did not feel like she was a good parent. Her priority was her children and she quit her employment as she did not have the proper time or energy for the children. She testified that it was not the right situation for her. She had tried for six years to have children and it was never her intention to work 80 hours a week.

[16] She further testified that she had an interview six days after she quit her employment but she kept looking for suitable employment. She wanted to have a work/life balance and work close to home. She hoped to be able to work from 9:00 a.m. to 5:00 p.m., have flexibility and to "be there for the children". She denies that it was her intention to quit her job at the time of the order of April 12, 2012. She decided to leave her employment three weeks before she terminated her employment. She left her employment on May 31, 2012.

[17] Ms. Hemond further testified that her income for 2012 was $71,362 gross. In December 2012 she obtained new employment and on January 14, 2013 she started her new job as a Senior Marketing Manager. This job was a step back from the position of Director, but it involved limited travel and her office was located 7 kilometres from her home. Her income is now $125,000 gross per year, plus a discretionary bonus. She will not find out until January 2014 if she receives a bonus which is based on personal and company performance. The maximum bonus she will receive is 10% of her salary.

Analysis

[18] Section 19(1)(a) of the Guidelines reads as follows:

19. (1) The court may impute such amount of income to a parent or spouse as it considers appropriate in the circumstances, which circumstances include:

(a) the parent or spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of any child or by the reasonable educational or health needs of the parent or spouse;

[19] In the Ontario Court of Appeal decision of Drygala v. Pauli, 2002 41868 (ON CA), [2002] O.J. No. 3731 (C.A.), the Court set out at para. 23, the three-part test in applying the provision under s. 19 of the Federal Child Support Guidelines, SOR/97-175, which is also applicable here. The first part of the test is to determine whether the spouse is intentionally under-employed or unemployed. If so, the second part of the test asks whether the intentional under-employment or unemployment is required by virtue of his or her reasonable educational needs, the needs of a child or reasonable health needs. If the answer to the second part of the test is negative, the third part of the test asks what income would be appropriately imputed in the circumstances.

[20] In Drygala at para. 28, the Court determined that "intentionally" means a voluntary act. The Court also stated that: "[t]he parent required to pay is intentionally under-employed if that parent chooses to earn less than he or she is capable of earning... The word ‘intentionally’ makes it clear that this section does not apply to situations in which, through no fault or act of their own, spouses are laid off, terminated or given reduced hours of work". The Court also found that there was no requirement of bad faith.

[21] As stated in the Ontario Court of Appeal decision of Homsi v. Zaya, 2009 ONCA 322, [2009] O.J. No. 1552, at para. 28: "The onus is on the person requesting an imputation of income to establish an evidentiary basis for such a finding."

[22] Based on the evidence before me, I find that Ms. Hemond was intentionally unemployed for part of the calendar year 2012. Ms. Hemond did voluntarily leave her employment and she chose not to work when she was capable of earning an income. However, I find that the intentional unemployment was required by virtue of the needs of the children and Ms. Hemond's health.

[23] I accept that Ms. Hemond continued to actively search for employment that would be in the best interests of the children and better for her health. I do not find that there was an intent to avoid paying child support or to contribute to section 7 expenses of the children. Further, despite the fact that Ms. Hemond’s total 2012 income was less than that of Mr. Casal, she continued to pay 50% towards the children's daycare expenses and did not seek any adjustment from Mr. Casal. Mr. Casal did not cross-examine Ms. Hemond on this issue and did not challenge her evidence. He also admitted on cross-examination that he did not know the reasons for Ms. Hemond leaving her employment.

[24] I accept Ms. Hemond's evidence that she was working 70 to 80 hours per week, she was having to travel to Montréal regularly, leaving early in the morning and returning at night and that this was having a negative effect on her ability to parent the children. Additionally, I accept her evidence that this was detrimentally affecting her own health as she was stressed, given she had to rise early in the morning to work before the children woke and she continued to work late into the evening after the children went to bed.

[25] I also find no validity to Mr. Casal's claim that Ms. Hemond quit her employment immediately after the April 12, 2012 court order in order to avoid paying her proportionate share with respect to the assessment or any other costs related to the children. There was no evidence of this to corroborate Mr. Casal's claims. No questions were asked of Ms. Hemond by Mr. Casal on cross-examination regarding this issue. Further, Ms. Hemond paid over $15,000 for the assessment. She also paid for 65% of the children's other expenses in 2012 as admitted by Mr. Casal.

[26] Based on all of these factors, I decline to impute an income of $150,000 gross to Ms. Hemond for the calendar year 2012 and I find that her income was $71,362 as reported in her Income Tax Return for 2012.

Issue #2

(ii) Does Ms. Hemond owe $42,361.83 to Mr. Casal which consists of arrears of child support and daycare expenses along with her proportionate sharing of the total costs for the assessment?

The Parties' Incomes

[27] During the course of the trial Mr. Casal provided evidence that his total income for the calendar years 2008 to 2012 was as follows:

i) 2008 - $55,122;

ii) 2009 - $64,697;

iii) 2010 - $77,612;

iv) 2011 - $81,308; and

v) 2012 - $86,446.

[28] Mr. Casal also provided pay stubs for the calendar year 2013 which show an annual pay rate of $86,340 gross. As of September 1, 2013 Mr. Casal had earned $62,878 gross from his employment.

[29] Ms. Hemond also provided evidence with respect to her total income for the calendar years 2008 to 2012 as follows:

i) 2008 - $122,678;

ii) 2009 - $58,186;

iii) 2010 - $128,702;

iv) 2011 - $263,963; and

v) 2012 - $71,362.

[30] Ms. Hemond also provided her Offer of Employment dated December 6, 2012 from her current employer confirming her base salary of $125,000 gross per year and her eligibility for a bonus of 10% of her eligible base salary. She also provided a pay stub for the pay period ending August 4, 2013 showing a year-to-date income of $69,748.50.

Mr. Casal's Position

[31] Mr. Casal's position is that Ms. Hemond was aware immediately after separation and onwards that he would be pursuing equal time with the children and he was seeking child support. He contends that Ms. Hemond was also aware that he would be seeking a contribution towards the children's section 7 expenses in proportion to the parties' incomes.

[32] In support of his position, he provided the following evidence:

i) Mr. Casal received an e-mail dated July 5, 2010 from Ms. Hemond. Ms. Hemond stated in her e-mail that she had no difficulties with sharing custody and if she needed to pay child support she would;

ii) Mr. Wells, Mr. Casal's lawyer at the time, sent a letter dated August 23, 2010 to Ms. Hemond. Mr. Wells referred to a shared parenting plan that would need to be in put in place. Among other issues, he also indicated that "financial issues should be addressed between you as soon as possible". He further asked that Ms. Hemond retain a family law lawyer as soon as possible so that the parties could exchange financial and other disclosure and work cooperatively towards the completion of a Separation Agreement;

iii) The parties entered into the Agreement dated October 22, 2010. Among the terms, there was a provision that the parties would share time equally with the children and that the children's daycare costs would be shared equally. The parties also agreed that they would review the parenting arrangements on January 15, 2011;

iv) Mr. Wells sent a letter dated January 7, 2011 to Ms. Hemond's lawyer at the time, Mr. Marks. Mr. Wells set out an agenda for another four-way meeting that would include discussions involving a residential schedule; a holiday access schedule; child support arrangements, including special and extraordinary expenses; and a dispute resolution mechanism, including a potential parenting coordinator. As evidenced by her e-mail dated January 7, 2011 to Mr. Casal, Ms. Hemond was aware of the letter from Mr. Wells;

v) Before the meeting was held in February 2011, additional items were added to the agenda. There was an oral agreement reached at the meeting that the equal parenting schedule would change to a week on week off arrangement and telephone contact with the children would be every other day. Mr. Casal testified that Ms. Hemond did not believe that an equal time-sharing schedule was workable and she wanted a custody and access assessment. Mr. Casal did not agree to an assessment as there were no clinical issues and it would be costly. From this moment forward, Ms. Hemond was moving away from a shared parenting arrangement;

vi) Ms. Hemond commenced her Application on July 19, 2011. Mr. Casal filed an Answer outlining his claims, including that Ms. Hemond pay child support according to the Guidelines and her proportionate share of special and extraordinary expenses;

vii) On March 13, 2012 in a letter to counsel, Mr. Wells sought an updated sworn Financial Statement from Ms. Hemond indicating the disposition of any stock options in the last 12 months, particularly those which Ms. Hemond received from her former employer. He also sought Ms. Hemond's 2011 Income Tax Return if prepared and if not, copies of her 2011 T4 and T5 statements. Mr. Casal testified that Ms. Hemond had changed jobs and that she had had a large number of stocks which had not been reflected on her Financial Statement;

viii) Based on Ms. Hemond's Financial Statement of July 2011, Mr. Casal assumed that Ms. Hemond's income was the same as the previous year, $128,702 gross. This was all of the information that he had at the time;

ix) On April 3, 2012, Mr. Wells sent an e-mail to Ms. Cohen indicating that he had not received any financial disclosure as requested in his letter of March 13, 2012;

x) Ms. Hemond brought a motion for an assessment and Mr. Casal brought a cross-motion regarding child support and section 7 expenses. On April 12, 2012, the parties attended at a hearing before Czutrin J. wherein Ms. Hemond's motion and Mr. Casal's cross-motion were scheduled to be heard. The parties agreed to a consent order that there would be a section 30 custody and access assessment. They also agreed that Ms. Hemond would pay the costs up front for the assessment and that the parties would share the costs of the assessment in proportion to their 2012 incomes. These costs could be set-off against any retroactive or prospective child support. Also pursuant to the order, the parties were to exchange in the next 60 days, 2011 Income Tax Returns and 2011 Notices of Assessment on receipt. Ms. Hemond was to provide, in the next 60 days, an updated sworn Financial Statement;

xi) On June 26, 2012, Mr. Wells requested Ms. Hemond's 2011 Income Tax Return and Notice of Assessment along with an updated sworn Financial Statement which had not yet been provided;

xii) Ms. Hemond's Financial Statement dated June 28, 2012 indicated that her 2011 income was $263,963, but was inflated due to a one-time payment. Mr. Casal testified that even before Ms. Hemond swore her Financial Statement on July 13, 2011, she knew in February 2011 that her income was higher. Mr. Casal and Mr. Wells had asked for financial information and had never received it;

xiii) The Financial Statement indicated that Ms. Hemond had already changed employers and that she had been unemployed since May 31, 2012; and

xiv) On July 5, 2012, Mr. Wells requested further financial disclosure including 2010 and 2011 Income Tax Returns in English, a copy of Ms. Hemond's new employment contract including salary, bonus and benefits, a copy of Ms. Hemond's severance package, including termination bonus and vesting of any options, a copy of Ms. Hemond's Record of Employment from her previous employer and a complete accounting of all stock options owned by Ms. Hemond as of June 2010 to present as well as a full explanation as to whether any stock options vested following the end of her employment. Mr. Wells indicated that Ms. Hemond had filed a "deliberately false Financial Statement by excluding any reference to the over $100,000 in income she says she received in February 2011".

[33] Mr. Casal also testified that he was falling into debt after separation. He filed as exhibits CIBC online banking statements which showed that as at October 3, 2010 his debt was approximately $39,236; May 31, 2011 his debt was approximately $54,821; March 17, 2012 his debt was approximately $72,829 and September 3, 2013, his debt was approximately $74,775.

Ms. Hemond's Position

[34] Ms. Hemond's position is that the parties governed themselves according to their Agreement. Neither was paying child support to the other and they were sharing daycare expenses equally. She contends that she was unaware that Mr. Casal was seeking child support and section 7 contributions until he filed his Answer and even after he filed his Answer, he did not pursue child support or section 7 expenses despite having brought a motion. She also contends that due to Mr. Casal's lack of contribution to the household and the expenses of the children, she fell into debt and was forced to cash in RRSPs.

[35] In support of her position Ms. Hemond provided the following evidence:

i) Her pregnancy with Matteo and Tessa was high risk. She was placed on bed rest and was paid 70% of her salary during this time. She was responsible for paying all the costs in the household and was required to hire a cleaning lady. Mr. Casal did the cooking;

ii) After the children were born, both children experienced a number of problems. Tessa required surgery one week after she was born. Ms. Hemond was spending 12 to 16 hours per day at the hospital with the children;

iii) Ms. Hemond's income was approximately $1,500 per month after the birth of the children as she was in receipt of Employment Insurance benefits only. Her household expenses were approximately $6,000 per month. Mr. Casal was paying approximately $500 per month to assist. He paid for cable, some groceries, some diapers, the Rogers bills as this included his calls overseas to Cuba, his cigarettes and his car payments. She was paying for most expenses related to the children. She was in debt on her line of credit and had credit card debt. She was responsible for paying all mortgage payments, property taxes, utilities, 75% of the groceries and all other expenses. She had many discussions with Mr. Casal regarding budgeting and assisting with the finances but he was not interested in contributing;

iv) Her shortfall increased by approximately $4,500 per month. Mr. Casal gave her approximately $500 per month, therefore she had a $4,000 per month deficit. She was forced to cash in her RRSPs when she found out she was pregnant because Mr. Casal was reluctant to assist with household expenses. She cashed in $23,327.60 in RRSPs in 2008. She paid $11,200 down on her credit card debt with the money that came from the cashing in of her RRSPs;

v) She was paying all of the daycare expenses as Mr. Casal refused to pay. She also had a new car lease to pay. She became upset with Mr. Casal and asked him to start contributing. Ms. Hemond testified that Mr. Casal did not pay her $500 every two weeks as he had stated in his evidence. After she became upset, from September 2009 to October 2010 Mr. Casal paid for one-half of the household expenses but he made no contribution to the mortgage payments, property taxes nor did he pay rent. She was responsible for paying for all of the equipment for the children including their strollers;

vi) On March 5, 2010 Mr. Casal transferred the sum of $803 to her for household expenses. On June 14, 2010 he transferred $504 to her for household expenses and on September 8, 2010, he transferred $421.36 to her for household expenses;

vii) From 2009 to 2010 Ms. Hemond incurred additional debt and had to extend her line of credit to $35,000. At the date of separation she was approximately $30,000 in debt. From September 2009 to October 2010, Mr. Casal started to make the contributions as mentioned, but he had not paid anything significant prior to September 2009 and he still did not pay rent or contribute to property taxes or the mortgage;

viii) On June 30, 2010, Ms. Hemond advised Mr. Casal that she wanted to separate. He was concerned about breaking up the family. Her employer asked her to move to Montréal which she considered as she would be closer to family. She had discussions with Mr. Casal but he was not agreeable;

ix) Ms. Hemond retained a lawyer and by way of correspondence dated September 7, 2010, Mr. Marks requested that Mr. Casal move out of Ms. Hemond's residence. He also indicated that Ms. Hemond was the primary caregiver of the children and that the children's primary residence should be with her. Mr. Marks received a letter from Mr. Wells dated September 9, 2010. Mr. Wells indicated that Mr. Casal would not move until a parenting plan had been arranged;

x) Ms. Hemond testified that this period of time was "horrible" as she found Mr. Casal very aggressive, he was not cleaning up in the home and he was making her "life hell". She testified that she was sick with vitiligo. It was clear to Ms. Hemond that Mr. Casal would not move out of her residence until she signed the Agreement;

xi) Ms. Hemond testified that Mr. Wells drafted the Agreement and he suggested an equal contribution to daycare. Mr. Casal never asked for child support and he was aware of her income. He was also aware that she would receive a lump sum from her employer. She signed the Agreement as the situation was unbearable. Mr. Casal moved out the next day;

xii) Her position changed with respect to the children in approximately February or March 2011 as the children were experiencing difficulties. Tessa was having problems sleeping and Matteo was exhibiting aggressive behaviour and a desire for attention. She felt the children were too young for equal time-sharing at least during the week. She was not going to seek child support if the children resided with her primarily and this was discussed with the lawyers;

xiii) She proceeded with her budget on the assumption that the Agreement would remain in place. The parties continued to share daycare expenses equally. The extra expenses for the children were paid 76% by her in 2011 and 65% by her in 2012 as Mr. Casal was imputing income to her. She paid these amounts because she did not want to argue. She paid for most of the children's snowsuits, boots and she paid for the children's birthday parties;

xiv) She commenced a court Application in 2011 because the children continued to experience ongoing difficulties. When Mr. Casal filed his Answer in September 2011, it was the first time he made a claim with respect to a set-off of child support. Later, Ms. Hemond brought a motion seeking a custody and access assessment and at the last minute Mr. Casal brought a cross-motion seeking a set-off of child support and a proportionate contribution towards daycare;

xv) Her salary for 2010 was approximately $128,700 which included salary and a car allowance. In 2011 her income was approximately $263,963 as she received a lump sum with respect to share options from a special incentive plan. Her former company was up for sale and as an incentive plan the Directors received options on shares. Fifty percent of the options were based on time based vesting and 50% was based on the company's performance. In a conference call in February 2011 she was told about the time based vesting shares;

xvi) The first time she became aware of this incentive plan was in approximately February 2010 when she received a document regarding the plan. Mr. Casal was aware that she would potentially receive a lump sum payment. At the time she did not understand much except that 50% was time based vesting. She did not have any idea that this would be characterized as income;

xvii) In her sworn Financial Statement of July 2011 these funds were not included in her income section as she did not know that these funds were income. She had not received a T4 slip. However, she included them in the assets section of her Financial Statement. She received a lump sum of $54,000 that was directly transferred into her account on February 18, 2011. A year later in February 2012 she received a T4, a T5008 and an amended T4 for $54,000. The $54,000 was never listed on any of her pay stubs. She was confused so she called Canada Revenue Agency to determine how she should file her Income Tax Return. This is when she realized that the funds were to be treated as income;

xviii) She filed a Financial Statement sworn June 28, 2012. On her Financial Statement she indicated that her income was $263,963 for 2011 which included $102,000 paid in February 2011 from the time vested stock options. This was a one-time payment. With the lump sum she was able to pay off debt, her line of credit and credit cards. She also replaced the RRSPs that she withdrew in the amount of $20,000;

xix) She changed jobs in approximately November 2011. Her former company was sold and there was uncertainty and new management. In her new job as Director of Marketing, she was working 70 to 80 hours per week and travelling 4 to 6 times per month. She was rising early in the morning to work before the children woke and she was working late into the evening while the children slept. She found it overwhelming and she was stressed. She did not feel as though she was a good parent and this was affecting her health. She resigned from her employment after five months;

xx) She continued to look for employment that would provide her with a work/life balance and would be located closer to home. She wanted to "be there" for the children. She had no intentions of quitting her job and only decided to leave three weeks before she left on May 31, 2012; and

xxi) She did not find out officially that Mr. Casal was residing with his girlfriend until the assessment in July of 2012. She found out approximately 6 to 7 months after Mr. Casal's girlfriend moved in with him.

[36] She now resides in a common-law relationship with her new partner, Eric, who moved into her home in June of 2012. Her partner paid for one-half of the fair market value of the home and is now on title. He pays for one-half of the mortgage and one-half of all household expenses. She pays more for groceries given she has the expenses of the children. With the money she received from her new partner for his purchase of a one-half interest in the home, she was able to purchase RESPs for the children, RRSPs for herself, renovate the home, and acquire some savings.

a) Is Mr. Casal entitled to child support and proportionate sharing of daycare expenses retroactive to January 1, 2011?

[37] Mr. Casal seeks child support pursuant to section 9 of the Guidelines and a proportionate sharing of daycare expenses retroactive to January 1, 2011 up to September 1, 2013. As indicated, prior to trial the parties settled the issues of ongoing child support and contribution to section 7 expenses. Before I turn to an analysis under section 9 of the Guidelines, it is first necessary to determine whether Mr. Casal is entitled to retroactive child support.

[38] In MacKinnon v. MacKinnon (2005), 2005 13191 (ON CA), 75 O.R. (3d) 175 (C.A.) at para. 19, the Ontario Court of Appeal clarified that retroactive support relates to claims for support for the period predating the commencement date of the pleading in which support is claimed. A claim for support within the pleading is properly characterized as prospective support. As such, Mr. Casal's claim for retroactive support is from January 1, 2011 until September 7, 2011, the date of the filing of his claim for support in his Answer.

[39] The Supreme Court of Canada in S. (D.B.) v. G. (S.R.), 2006 SCC 37, [2006] 2 S.C.R. 231 adopted a discretionary approach to retroactive support. The Court set out the factors to consider in determining whether to order retroactive support. The Court stated that these factors should be considered by the Court but none of the factors is decisive. The factors are as follows:

i) reasonable excuse for why support was not sought earlier;

ii) conduct of the payor parent;

iii) circumstances of the child; and

iv) hardship occasioned by a retroactive award.

[40] Mr. Casal testified that Ms. Hemond was aware of his claim for support shortly after separation as evidenced by her e-mail to him dated July 5, 2010 and correspondence from his lawyer dated August 23, 2010. His evidence was that the issue of child support pursuant to s. 9 of the Guidelines and a proportionate sharing of s. 7 expenses was sought by him immediately after separation. He contends that this is verified by Mr. Wells' correspondence and Mr. Wells' ongoing requests for disclosure produced as evidence.

[41] Ms. Hemond's evidence was that the Agreement entered into by the parties on October 22, 2010 was silent on child support even though Mr. Casal was aware at the time that his income was lower than Ms. Hemond's income. Further, she contends that the parties conducted themselves in accordance with the Agreement and no formal change was made to the Agreement.

[42] She contends that child support was not sought by Mr. Casal until he filed his Answer on September 7, 2011. Additionally, he took no steps after the filing of his Answer to pursue child support until he brought a motion. Ms. Hemond contends Mr. Casal's motion was brought at the last minute and was only in response to her motion for an assessment. He then took no further steps to pursue child support as his motion was adjourned.

Analysis

[43] I have considered the factors as set out in S. (D.B.) v. G. (S.R.) that a Court must consider in order to determine the issue of retroactive child support as follows:

i) Reasonable excuse for why support was not sought earlier

[44] Mr. Casal was represented by counsel throughout most of the proceedings. At any time he could have formally pursued child support and a proportionate contribution to section 7 expenses but he chose not to do so until the filing of his Answer on September 7, 2011. I find that this was the first date that Ms. Hemond had effective notice of his claim for child support, a proportionate sharing of section 7 expenses and a retroactive claim. I accept that both parties were aware that Ms. Hemond's income was higher than Mr. Casal's income at the time they signed the Agreement on October 22, 2010 but they were content to enter into the Agreement with the Agreement silent on child support. I find that there is no reasonable excuse as to why support was not sought earlier if it was Mr. Casal's intention to do so.

[45] Further, Mr. Casal agreed on cross-examination that in his lawyer's letter of August 23, 2010, there was nothing implicit in the letter indicating that Mr. Casal was claiming a set-off of child support under section 9 of the Guidelines. With respect to the agenda for the meeting as set out by his lawyer in correspondence in January 2011, Mr. Casal agreed that it was possible that the financial arrangements referred to by Mr. Wells could have been Ms. Hemond's claim for child support. He also agreed that there was no notice in that letter that he was seeking a section 9 set-off support amount.

ii) Conduct of the payor parent

[46] Given the parties were sharing time equally with the children and section 9 of the Guidelines applies, both of the parties' incomes are relevant for child support purposes and both have an obligation to support the children.

[47] In S. (D.B.) v. G. (S.R.), the Court characterized blameworthy conduct as "anything that privileges the payor parent's own interests over his/her child's right to an appropriate amount of support". I find no blameworthy conduct on the part of Ms. Hemond. She conducted herself in accordance with the provisions of the Agreement and she continued to pay one-half of the children's daycare costs. Additionally, her evidence was not disputed that she paid 76% of the extra expenses for the children in 2011. I also accept her evidence that was not tested on cross-examination, that she continued to pay for the children's additional expenses including snowsuits, boots and the children's birthday parties.

[48] Ms. Hemond's income did increase significantly in 2011 as a result of a one-time payment from her former employer. I accept her evidence that she did not realize this payment was to be treated as income until she received her T4 and T5008 information in February 2012 and made inquiries to Canada Revenue Agency. I also accept her evidence that she stated on her Financial Statement on July 13, 2011 that these funds represented an asset as she had never received a paystub for the amounts she received. When Ms. Hemond found out that this was income, she advised Mr. Casal. She swore another Financial Statement and she provided her 2011 Income Tax Return to Mr. Casal. There was no withholding of information or a failure to disclose. I find that there was no blameworthy conduct or any effort to hide these funds to avoid paying child support to Mr. Casal.

iii) Circumstances of the child

[49] There is no evidence that the children's needs were not being met in either household. Mr. Casal continued to reside in the same residence with the children as he had previously and Ms. Hemond continued to reside in her home with the children. The children remained in the same daycare and the parties continued to pay an equal amount towards the children's daycare costs. As indicated, during the period in question, Ms. Hemond paid for the majority of the children's other expenses including their larger items.

iv) Hardship occasioned by a retroactive award

[50] I cannot conclude based on the evidence that Ms. Hemond had any effective notice of these claims prior to the Answer being filed. None of the correspondence between the parties or between counsel presented as evidence leads me to conclude that Ms. Hemond would have been aware that the respondent was seeking child support and a proportionate sharing of section 7 expenses prior to the filing of the formal pleading. Although there was reference to financial issues in some correspondence, there was no specific reference to a claim being made by Mr. Casal for child support and section 7 expenses or that any claim was being made retroactive to the date of separation. The Agreement entered into between the parties on October 22, 2010 was silent as to child support and only specifically dealt with the parties agreeing to an equal time-sharing schedule with respect to the children and making an equal contribution to daycare among other provisions.

[51] There was evidence that Ms. Hemond went into debt over $30,000 and had to cash in approximately $23,000 in RRSPS in order to cover the household expenses during her pregnancy and support the children after the birth of the children and post-separation. This was due to her reduced income and what I find was a lack of appropriate contribution towards rent, household expenses and the children's expenses by Mr. Casal. It took some time before Ms. Hemond was able to pay down this debt, in fact until 2011. I find that any retroactive support order would prove a hardship to Ms. Hemond and not account for the unnecessary debt and hardship that she had to incur given Mr. Casal's lack of contribution.

[52] For all of the above reasons, I decline to order any retroactive support to Mr. Casal.

b) Is Mr. Casal entitled to child support and a proportionate sharing of daycare expenses from the filing of his Answer to September 1, 2013?

[53] The parties have shared custody and equal time with Matteo and Tessa since they physically separated on October 23, 2010 after the completion of the Agreement on October 22, 2010. The Agreement was interim and without prejudice. Nothing in the Agreement precludes Mr. Casal from seeking child support or an adjustment to the sharing of the daycare expenses. As indicated, I find that Ms. Hemond had effective notice of Mr. Casal's claim for child support and a proportionate sharing of daycare expenses from the filing of his Answer on September 7, 2011. An analysis under s. 9 of the Guidelines needs to take place to determine if Mr. Casal is entitled to child support and a proportionate sharing of daycare expenses for the time period sought by him at trial.

[54] The provisions with respect to shared custody are set out in the Guidelines at section 9 as follows:

Shared custody

9. Where a parent or spouse exercises a right of access to, or has physical custody of, a child for not less than 40 per cent of the time over the course of a year, the amount of the order for the support of a child must be determined by taking into account,

(a) the amounts set out in the applicable tables for each of the parents or spouses;

(b) the increased costs of shared custody arrangements; and

(c) the condition, means, needs and other circumstances of each parent or spouse and of any child for whom support is sought.

[55] The Supreme Court of Canada in Contino v. Leonelli-Contino, [2005] S.C.J. No. 65, 2005 SCC 63 (S.C.C.) at para. 37 outlined that the framework of section 9 requires a two‑part determination. A 40% threshold must first be met; and where it has been met, the appropriate amount of support must be determined in accordance with the three listed factors set out in section 9.

[56] The Court further stated at para. 39:

…The specific language of s. 9 warrants emphasis on flexibility and fairness. The discretion bestowed on courts to determine the child support amount in shared custody arrangement calls for the acknowledgement of the overall situation of the parents (condition and means) and the needs of the children. The weight of each factor under s. 9 will vary according to the particular facts of each case.

[57] As the parties share time equally with Matteo and Tessa, the 40% threshold is met and the analysis turns to the three listed factors set out in section 9.

[58] The first factor in section 9 requires that the Court take into account the amounts set out in the applicable tables for each of the parents. As stated by the Court in Contino v. Leonelli-Contino at para. 49:

"...the simple set-off serves as the starting point, but it cannot be the end of the inquiry. It has no presumptive value. Its true value is in bringing the court to focus first on the fact that both parents must make a contribution and that fixed and variable costs of each of them have to be measured before making adjustments to take into account increased costs attributable to joint custody and further adjustments needed to ensure that the final outcome is fair in light of the conditions, means, needs and other circumstances of each spouse and child for whom support is sought. Full consideration must be given to these last two factors (see Payne, at p. 263). The cliff effect is only resolved if the court covers and regards the other criteria set out in paras. (b) and (c) as equally important elements to determine the child support.

[59] The Court when on to further state at para. 51:

…The court retains the discretion to modify the set-off amount where, considering the financial realities of the parents, it would lead to a significant variation in the standard of living experienced by the children as they move from one household to another, something which Parliament did not intend. As I said in Francis v. Baker, one of the overall objectives of the Guidelines is, to the extent possible, to avoid great disparities between households. It is also necessary to compare the situation of the parents while living under one roof with the situation that avails for each of them when the order pursuant to s. 9 is sought. As far as possible, the child should not suffer a noticeable decline in his or her standard of living. Still, it is not a discretion that is meant to set aside all rules and predictability. The court must not return to a time when there was no real method for determining child support (Paras v. Paras, 1970 370 (ON CA), [1971] 1 O.R. 130 (C.A.)).

[60] For the calendar year 2011, Mr. Casal's total income was approximately $81,308. Ms. Hemond's total income was approximately $263,963. The monthly child support table amount payable by Mr. Casal is $1,188. The monthly child support table amount payable by Ms. Hemond is $3,311. If a set-off approach is used, this would result in Ms. Hemond paying the difference between the two sums to Mr. Casal in the amount of $2,123 per month. For the period from the commencement of Mr. Casal's claim for child support, being September 2011 through to and including December 1, 2011 the total amount owing by Ms. Hemond to Mr. Casal would be $8,492. The proportionate sharing of section 7 expenses, which would include daycare, would be 76% payable by Ms. Hemond and 24% payable by Mr. Casal.

[61] For the calendar year 2012, Mr. Casal's total income was $86,446. Ms. Hemond's total income was $71,362. The monthly child support table amount payable by Mr. Casal is $1,250. The monthly child support table amount payable by Ms. Hemond is $1,055. If a set-off approach is used, this would result in Mr. Casal paying the difference between the two sums to Ms. Hemond in the amount of $195 per month. From January 1, 2012 through to and including December 1, 2012, the total amount owing by Mr. Casal to Ms. Hemond would be $2,340. The proportionate sharing of section 7 expenses which would include day care would be 55% by Mr. Casal and 45% by Ms. Hemond.

[62] For the calendar year 2013, Mr. Casal's total income is approximately $86,340. Ms. Hemond's total income is approximately $125,000. The monthly child support table amount payable by Mr. Casal is $1,250. The monthly child support table amount payable by Ms. Hemond is $1,721. If a set-off approach is used, this would result in Ms. Hemond paying the difference between the two sums to Mr. Casal in the amount of $471 per month. From January 1, 2013 through to and including September 1, 2013, the total amount owing by Ms. Hemond to Mr. Casal would be $4,239. The proportionate sharing of section 7 expenses which would include daycare would be 59% by Ms. Hemond and 41% by Mr. Casal.

[63] The second factor to be considered includes the increased costs of shared custody arrangements. As set out by the Court in Contino v. Leonelli-Contino, when considering this factor, the Court needs to examine financial statements and/or child expense budgets to determine whether the shared custody arrangements have resulted in an increase in the total costs of providing for the children because of the duplication of fixed costs in providing two homes for the children. As also stated by the Court, this section also recognizes that the costs of raising a child in a shared custody arrangement may be higher than in a primary residence situation.

[64] The parties have not prepared child expense budgets. Each party filed sworn Financial Statements; however, neither provided much evidence with respect to this issue. The only evidence provided by Mr. Casal in his testimony with respect to this factor was his statement that perhaps he may have obtained a one-bedroom apartment if he was not in a shared parenting arrangement. However, as was clear on cross-examination, he actually obtained his larger apartment before the parties signed the Agreement and had consented to a shared parenting arrangement so there is no conclusive evidence before the Court as to whether Mr. Casal's housing costs would have increased.

[65] As no child expense budgets have been prepared by either party, it is difficult to accurately determine the total costs related to the children. Although neither party provided detailed evidence that would have assisted the Court in considering this second factor, I accept that, based on the evidence, Ms. Hemond has provided most of the larger clothing items for the children without contribution from Mr. Casal and she has also paid for a greater percentage of the children's special and extraordinary expenses (other than daycare) as was acknowledged by Mr. Casal in his evidence since the date of separation.

[66] The third factor to consider is the conditions, means, needs and other circumstances of each spouse and of any child for whom support is sought.

[67] Counsel for Ms. Hemond contends that much evidence was provided at trial with respect to this third factor. She asks the Court to consider Ms. Hemond's evidence that she assumed the majority of the family expenses commencing two years prior to separation such that on the date of separation, Ms. Hemond had over $30,000 in debt and she had to cash in $23,000 in RRSPs.

[68] Counsel for Ms. Hemond further contends that the evidence shows that after the children were born, Ms. Hemond had household expenses of approximately $6,000 per month while she only had an income of approximately $1,500 per month. Counsel submits that if the Court were to accept Mr. Casal's evidence that he paid $500 twice per month, which was disputed by Ms. Hemond, that would still leave Ms. Hemond with a significant deficit at the time, ranging from $3,000 to $4,000 per month. Counsel submits that Mr. Casal had a responsibility to his children and was also residing in Ms. Hemond's home without making a contribution to mortgage payments or making rental payments. She asks that the Court consider all circumstances and submits that the Court is not limited to considering the time frame sought by Mr. Casal, being from January 1, 2011, given the discretionary nature of section 9.

[69] Further, counsel for Ms. Hemond submits that the evidence is clear that Mr. Casal did not begin to contribute to the household expenses and child related expenses until September 2009. She submits that Ms. Hemond's evidence, which was not disputed by Mr. Casal or challenged on cross-examination, is that Mr. Casal made no contributions to the mortgage or property taxes of Ms. Hemond's home, nor did he pay any rent for the entire period that he resided with her from September 2005 until the parties physically separated on October 23, 2010. This was despite the birth of the children and the decreased income of Ms. Hemond.

[70] Counsel for Ms. Hemond also submits that Mr. Casal's evidence proves that his debt has increased only as a result of ongoing legal fees and not because of child related expenses. She contends that the parties settled the issue of costs in the settlement of all other issues with the exception of the issues that proceeded to trial. She further contends that Mr. Casal's sworn Financial Statements prove that despite his evidence that his girlfriend with whom he resided for a significant period of time attended school but had employment as well, Mr. Casal was carrying all of costs of his household without contribution from his girlfriend. Mr. Casal denied on cross-examination that this had contributed to his debts.

[71] In contrast, Mr. Casal submits that based on the Financial Statements provided as evidence by the parties, his net worth has decreased while Ms. Hemond's net worth has increased. He submits that Ms. Hemond's net worth increased despite the fact that she contends that her income had gone down in 2012. When reviewing the conditions, means, needs and other circumstances of each spouse and the children, he submits that there is a significant variation in the children's standard of living in each household.

Analysis

a) 2011

[72] With respect to any support owing from September 7, 2011 until the end of December 2011, I accept Ms. Hemond's evidence that her cash flow decreased prior to the birth of the children when she was on bed rest and it decreased significantly after the birth of the children when she was in receipt of Employment Insurance benefits while on maternity leave. I also accept Ms. Hemond's evidence that for a significant period of time after the birth of the children, Ms. Hemond paid for the vast majority of the household expenses and the children's expenses. This was during a period of time when her cash flow was reduced and in 2009 when Mr. Casal's income exceeded that of Ms. Hemond.

[73] I also accept Ms. Hemond's evidence that she was forced into debt and forced to cash in RRSPs as she was not receiving adequate financial assistance from Mr. Casal during her pregnancy and after the birth of the children. The evidence of Ms. Hemond was that she has only been able to pay down her debt and replenish her RRSPs given the significant payment that she received from her former employer in 2011. I find that Ms. Hemond did not appreciate that the additional payment to her from her former employer in 2011 was income at the time that she received the funds. I accept that she disclosed the funds that she had received (the first $54,000) by treating the funds as an asset on her sworn Financial Statement as she thought the funds were to be treated as an asset rather than income.

[74] Ms. Hemond earned significantly more income than Mr. Casal in 2011 given the one-time additional payments received from her former employer. However, as the Supreme Court of Canada outlined in Contino v. Leonelli-Contino, a simple set-off has no presumptive value.

[75] For 2011, I do not find that Ms. Hemond had a decrease in her fixed expenses as a result of the shared custody arrangement. I find that Ms. Hemond paid for the majority of the household expenses of the family during her pregnancy. She also paid for the majority of the household expenses and those of the children from their birth and since separation until Mr. Casal obtained his own residence on October 23, 2010.

[76] There was a significant lack of contribution to the family expenses by Mr. Casal prior to the birth of the children during Ms. Hemond's pregnancy, from after the birth of the children and up to the time the parties physically separated, resulting in Ms. Hemond having a debt of approximately $30,000 and being forced to cash in approximately $23,000 of RRSPs to manage financially.

[77] Mr. Casal did not make adequate financial contributions to Ms. Hemond despite the financial benefit that he received from residing in Ms. Hemond's home in not having to contribute to a mortgage or pay rent as he would have to do elsewhere. Most importantly for the issue of child support, his lack of contribution to these expenses continued even after the children were born and after separation when he continued to reside in Ms. Hemond’s home rent-free and without making any significant contribution to the household expenses and those of the children. This was a benefit to Mr. Casal and one which during Ms. Hemond's pregnancy, after the birth of the children and after the date of separation, significantly contributed to Ms. Hemond falling into debt. This would have been unnecessary had Mr. Casal contributed appropriately to the costs of the household and the children.

[78] It is acknowledged that commencing September of 2009 at Ms. Hemond’s insistence, Mr. Casal began to contribute to the daycare costs of the children and to some of the household expenses. However, Ms. Hemond still remained primarily responsible for the majority of the costs for the children other than daycare. She also continued to be the sole contributor to the mortgage payments while Mr. Casal refused to contribute rent.

[79] After the physical separation of the parties on October 23, 2010, the parties pursuant to the Agreement, contributed equally towards the costs of daycare and no child support payments were made by either party as the Agreement was silent on child support. Throughout 2011 and 2012, it was acknowledged by Mr. Casal that Ms. Hemond paid for the greater percentage of the children’s expenses.

[80] On cross-examination, Mr. Casal acknowledged that in 2008, when the children were born, his total income was $55,123 gross. He also acknowledged that he contributed $2,500 towards his RRSPs in 2008. He further acknowledged that Ms. Hemond was on bed rest for three months prior to the birth of the children and that she was not receiving her full salary. Additionally, he acknowledged that after the birth of the children Ms. Hemond was in receipt of Employment Insurance benefits only and that from September to December 2008 she received the gross sum of $6,960 in Employment Insurance benefits. He also acknowledged that Ms. Hemond withdrew $23,328 from her RRSPs.

[81] Mr. Casal testified that he did not pay rent but that he contributed to the mortgage, property taxes and utilities by giving Ms. Hemond $500 every two weeks and he contributed to other expenses. I do not accept his evidence as he produced no evidence to validate his claim. Mr. Casal testified that in 2009 he was not contributing to the mortgage, taxes or paying any rent. He admitted that the parties were arguing about finances.

[82] Mr. Casal testified that he did not know that Ms. Hemond was going into debt during the 2009 calendar year. However, in his testimony he also acknowledged that Ms. Hemond's income was reduced, it was approximately $1,500 per month and she would have had a deficit of approximately $3,500 per month.

[83] When asked if it was possible that Ms. Hemond purchased all items for the children including baby furniture, Mr. Casal indicated at first that he did not agree with this statement but then changed his answer to indicate that he did not have an exact recollection.

[84] In 2009, Mr. Casal agreed that his income was $64,697 gross and that he also contributed $2,600 to RRSPs. He acknowledged that Ms. Hemond withdrew $2,130 from her RRSP and that he claimed childcare expenses of $8,614 in 2009. He further acknowledged that he received a refund of $3,584 for that year. He agreed that Ms. Hemond was in receipt of Employment Insurance benefits only for the period January to September 2009 and she received $14,790 gross.

[85] Mr. Casal admitted that he knew of Ms. Hemond's stock options but not when the options were due. He also acknowledged that he knew it would be a lump sum payment.

[86] Mr. Casal admitted that he moved out at the end of October 2010 and that also from January to October 2010 he did not contribute to the mortgage or property taxes. He stated that he paid 50% of all other expenses in the home but he did not pay any rent.

[87] With respect to expenses in 2011, Mr. Casal testified that he had been paying 50% of the daycare costs and that the parties contributed to the other activities and expenses of the children in proportion to their incomes. He acknowledged that Ms. Hemond paid for more of these expenses.

[88] I must also consider the impact a child support order will have on the standard of living of the children in each of the households. There was not a significant difference in the children’s standards of living in the two households as submitted by Mr. Casal in his closing submissions. Both parties continued to reside in the same residences with the same fixed costs (with Ms. Hemond's fixed housing costs being higher) and there was no evidence that the children experienced a difference in the standard of living in Mr. Casal’s home.

[89] Mr. Casal’s evidence focused on his increased debt post-separation. While Mr. Casal’s debt did increase, I find that this was due to the increased costs of litigation that both parties encountered. Mr. Casal acknowledged on cross-examination that he had significant legal fees that correspond with some of the increase in his debt.

[90] Ms. Hemond’s income was significantly higher than Mr. Casal’s for the calendar year 2011. As indicated, if a set-off approach was applied, this would result in a total amount owing by Ms. Hemond of $8,492. This would also result in Ms. Hemond paying 76% of the daycare expenses and other section 7 expenses. Based on the undisputed evidence, Ms. Hemond did pay for 76% of the expenses of the children other than daycare which was shared equally. When considering the increased costs of the shared custody arrangement (for which there was little evidence) and the conditions, means, needs and other circumstances of each parent and the children as set out in section 9, I decline to order Ms. Hemond to pay support from the filing of Mr. Casal’s Answer on September 7, 2011 to the end of December 2011, given the lack of contribution by Mr. Casal from the time of Ms. Hemond's pregnancy until he left the home on October 23, 2010. As indicated, this placed Ms. Hemond into a debt situation that she was only able to recover from once she received her additional income in 2011 from her former employer.

c) 2012

[91] With respect to the calendar year 2012, as indicated, Mr. Casal's total income was $86,446 and Ms. Hemond's total income was $71,362. The monthly child support table amount payable by Mr. Casal is $1,250. The monthly child support table amount payable by Ms. Hemond is $1,055. If a set-off approach is used, this would result in Mr. Casal paying the difference between the two sums to Ms. Hemond in the amount of $195 per month. From January 1, 2012 through to and including December 1, 2012, the total amount owing by Mr. Casal to Ms. Hemond would be $2,340. The proportionate sharing of section 7 expenses which would include daycare would be 55% by Mr. Casal and 45% by Ms. Hemond. No child support was paid by either party and they contributed equally to the daycare costs for the children. Mr. Casal acknowledged in his evidence that Ms. Hemond paid more for the other expenses of the children.

[92] No child expense budgets were prepared by the parties. Mr. Casal's Financial Statement, sworn April 4, 2012, lists costs of $1,121 for rent and $21 for property insurance. There are no costs set out for utilities: in particular, water, heat or electricity, and it appears that these costs are covered in the monthly rental payment. There are monthly costs of $80 for cable, $53 for Internet, $89 for cell phone and $50 for long distance charges to Cuba. There are costs set out for the children's daycare of $668 per month and extraordinary expenses of $100 per month. Grocery costs are $250 per month and $25 per month for meals outside the home along with $100 per month for household supplies. There are clothing expenses for the children of $100 per month, plus $50 per month for children's activities. The only special or extraordinary expenses for the children set out in Schedule C of Mr. Casal's Financial Statement are the daycare costs. Mr. Casal lists total assets of $27,465 and total debts of $72,814. His debts are comprised of a line of credit debt for which he states he pays $1,500 per month, a vehicle loan for which he states he pays $416 per month and credit card debts for which he states he pays $1,525 per month.

[93] In Ms. Hemond's Financial Statement, sworn June 28, 2012, her housing costs total $2,888 per month which includes a mortgage payment of $2,158, property taxes of $310, property insurance of $70 and repairs and maintenance of $350. There also utilities listed of $125 per month for water, $90 for heat, and $110 per month for electricity. Her cell phone monthly expenses are listed at $50, telephone at $80, cable at $100 and Internet at $75. Groceries are listed at $500 per month, with meals outside the home being $150 per month and household supplies of $100 per month. She also lists daycare costs of $650 per month and notes that the other half is paid by Mr. Casal. With respect to the children, school fees and supplies are $20 per month, $75 per month for clothing and $25 per month for children's activities. With respect to Schedule C to her Financial Statement, she only lists daycare expenses. Ms. Hemond lists total assets of $706,247.93 and total debts of $419,775.88. Her only debt listed is that of her mortgage for which she states she pays $2,192.15 per month.

[94] Based on the evidence, I find that there should be no child support payable by either party or an adjustment to the daycare expenses for 2012. I have declined to impute income to Ms. Hemond for 2012. Her income was less than Mr. Casal's income for 2012 but she was not seeking child support at trial. Additionally, neither party provided evidence regarding the increased costs of the shared custody arrangement for 2012. Mr. Casal's net worth was significantly lower, mainly due to the fact that Ms. Hemond owned her home which still had a significant mortgage, and she was able to pay off her debts in 2011, with the exception of the mortgage. Mr. Casal still had insignificant assets and carried debt. According to his sworn Financial Statement, Mr. Casal paid substantial amounts on a monthly basis towards his debts. Both parties continued to reside in their same residences. On the evidence, Ms. Hemond had higher fixed costs for housing although it is unclear when her new partner started contributing towards the housing expenses as he commenced residing with Ms. Hemond in June 2012. Mr. Casal agreed in his evidence that Ms. Hemond paid for more of the children’s extra costs while the parties contributed equally to the daycare costs. It does not appear when reviewing the parties’ Financial Statements for 2012 that the children were experiencing a noticeable difference in their standard of living in each household.

c) 2013

[95] With respect to the calendar year 2013, Mr. Casal's total income is approximately $86,340. Ms. Hemond's total income is approximately $125,000.

[96] No child expense budgets were prepared by the parties. In Mr. Casal's Financial Statement, sworn September 3, 2013, he lists costs of $1,148 for rent and $25 for property insurance. Repairs and maintenance are listed at $25. There are no costs set out for utilities: in particular, water, heat or electricity, and it appears that these costs are covered in the monthly rental payment. There are monthly costs of $80 for cable, $53 for internet, $89 for cell phone and $50 for long distance charges to Cuba. There are costs set out for the children's daycare of $380 per month, extraordinary expenses of $20 per month, school lunches of $80 per month and summer daycare of $100 per month (although stated as $200 per child per week). Grocery costs have increased to $550 per month and $100 per month for meals outside the home along with $100 per month for household supplies. There are clothing expenses for the children of $50 per month plus $100.00 per month for children's activities. There are also expenses of $50 per month for school fees and supplies. The special or extraordinary expenses for the children set out in Schedule C of Mr. Casal's Financial Statement are the daycare costs, summer daycare, children's lunches, health and dental services, additional daycare activities, extra curricular activities and French tutoring. No amounts are set out for any expenses except the daycare related expenses and school lunches. Mr. Casal lists total assets of $19,496 and total debts of $75,086. His debts are comprised of a line of credit debt for which he states he pays $1,642 per month, a vehicle loan for which he states he pays $405 per month and credit card debts for which he states he pays $2,452 per month.

[97] In Ms. Hemond's Financial Statement, sworn August 30, 2013, her housing costs total $1,821 per month which includes one-half the housing expenses she shares with her partner with her share being a mortgage payment of $1,084, property taxes of $188, property insurance of $49 and repairs and maintenance of $500. There is also one-half of the utilities listed of $65 per month for water, $50 for heat, and $75 per month for electricity. Her cell phone monthly expenses are paid by work, telephone at $20, one-half of cable at $25 and Internet at $56. Groceries are listed at $420 per month, with meals outside the home being $200 per month and household supplies of $50 per month. She also lists daycare costs of $481 per month and summer daycare of $100 per month. With respect to the children, school fees and supplies are $20 per month, $100 per month for clothing and $83 per month for children's activities. With respect to Schedule C to her Financial Statement, she lists daycare expenses of $11,544 and uninsured medical/dental/therapy costs with no amount given. Ms. Hemond lists total assets of $602,862 and total debts of $133,573. Her debt listed is that of her mortgage for which he states she pays $1,084 per month and a Visa bill of $2,409 which is listed as being paid in full.

[98] Once again, neither party provided much additional evidence regarding the increased costs of the shared custody arrangement for 2013 other than the expenses set out in their Financial Statements. Mr. Casal's net worth was still significantly lower, mainly due to the fact that Ms. Hemond continued to own her home; however, Ms. Hemond's partner purchased a one-half interest in her home and is sharing one-half of the mortgage debt. Ms. Hemond's Financial Statement indicates that monies are still owing to her by her partner with respect to the purchase of a one-half interest in the home. Mr. Casal's debts have increased slightly since his Financial Statement in 2012. Ms. Hemond's only significant debt continues to be her mortgage.

[99] Both parties continue to reside in their same residences. With the sharing of expenses by Ms. Hemond's partner, Ms. Hemond's household costs have been reduced, but her housing costs still exceed those of Mr. Casal. On the evidence Ms. Hemond pays for more of the children’s extra costs while the parties contributed equally to the daycare costs up to September 2013.

[100] Taking all of the above factors into account, considering the lack of evidence before me of the increased costs of the shared custody arrangement and considering the condition, means, needs and other circumstances of Ms. Hemond, Mr. Casal and the children, I find that it is appropriate to use the set-off amount for child support for the calendar year 2013. I have taken into consideration that for 2013, Mr. Casal earns significantly less gross annual income than Ms. Hemond and the children’s standard of living in his home should not be substantially dissimilar to the standard of living in Ms. Hemond's home that she shares with her partner.

[101] The monthly child support table amount payable by Mr. Casal is $1,250. The monthly child support table amount payable by Ms. Hemond is $1,721. The set-off amount is $471 per month which I find is an appropriate amount of child support for Ms. Hemond to pay to Mr. Casal considering the above factors. The amount of $471 per month for child support from January 1, 2013 through to and including September 1, 2013 shall be paid by Ms. Hemond to Mr. Casal resulting in a total amount of child support arrears of $4,239. The proportionate sharing of the daycare expenses shall be 59% by Ms. Hemond and 41% by Mr. Casal from January 1, 2013 through to and including September 1, 2013.

Assessment Costs

[102] Pursuant to the order of Czutrin J. dated April 12, 2012, the parties agreed that Ms. Hemond would pay the costs upfront for the assessment and that the parties would share in proportion to their 2012 incomes the costs of the assessment. These costs could be set-off against any retroactive or prospective child support. The cost for the assessment was $15,531.00. Ms. Hemond earned less than Mr. Casal in 2012, but she is only seeking a 50% contribution to the total cost paid by her for the assessment of $15,531. With respect to the costs for the final report, her position is that Mr. Casal wanted a report for trial and he should pay for this expense as she did not agree to share in this cost which she believes was unnecessary.

[103] The evidence was that the assessment was completed in August 2012 and the parties attended a disclosure meeting with the assessor. The assessor only provided a two-page abstract of the assessment with a proposed plan and recommendations. As the parties had not settled and a trial was imminent, Mr. Casal testified that he contacted the assessor in July 2013 to obtain a full assessment report which was needed for trial. The cost for the finalization of the report was $5,085. Mr. Casal paid for the finalization of the report.

[104] The parties did not settle all of the other issues, including custody and time sharing until just prior to trial. I find that it was reasonable for Mr. Casal to order a final report for trial in July of 2013 as the parties had not yet settled and the matter was set for trial. I also find it reasonable that both parties share equally in the total costs of $20,616 for the assessment. Each party would be responsible to pay $10,308; therefore, Mr. Casal owes $5,223 to Ms. Hemond for the total costs of the assessment.

Order

[105] I order the following:

i) There shall be no child support payable by either party to the other, and no adjustment of daycare contributions or section 7 expenses for the calendar years 2011 and 2012;

ii) Ms. Hemond shall pay to Mr. Casal the sum of $4,239 for child support arrears from January 1, 2013 through to and including September 1, 2013 for the children Matteo Antoine Casal and Tessa Maria Casal, born August 26, 2008. Ms. Hemond shall pay 59% of the daycare costs and Mr. Casal shall pay 41% of the daycare costs for this same period;

iii) Mr. Casal shall pay $5,223 to Ms. Hemond for his one-half share of the total costs of the custody and access assessment;

iv) I urge the parties to agree on costs; however, if they are unable to do so, any party seeking costs shall serve and file written submissions, no longer than two double-spaced pages, along with a Bill of Costs and any Offers to Settle within 20 days. Any party wishing to reply, shall serve and file written costs submissions, no longer than two double-spaced pages, 14 days thereafter. All costs submissions shall be filed at Judges' Administration, Room 170, at 361 University Avenue addressed to my attention.

Stevenson J.

Released: November 12, 2013

COURT FILE NO.: FS-11-17494

DATE: 20131112

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

ISABELLE HEMOND

Applicant

• and -

JOSE ANTONIO CASAL GALANO

Respondent

REASONS FOR DECISION

Stevenson J.

Released: November 12, 2013