ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: FS-03-047851-03
DATE: 2013 11 22

B E T W E E N:

DIANNE HOLMAN

Frances M. Wood, for the Applicant

Applicant

• and -

BRUCE HOLMAN

Joost K. Heersche, for the Respondent

Respondent

HEARD: September 15, 2013

REASONS FOR JUDGMENT

André J.:

[1] The Holmans, both of whom are 59 years of age, got married in 1983 and separated in 2002. They have twin girls, Kendra and Paige, who are 24 years of age. Mr. Holman, who earns approximately $130,000 annually, has been paying child and spousal support since the couple separated. However, he now wishes support to end given that his daughters completed their first degree in May 2011, Mrs. Holman earns approximately $60,000 annually and owns a half million dollar home. Furthermore, Mr. Holman seeks reimbursement of $82,000 in child and spousal support payments he has made after May 2011. Mrs. Holman, on the other hand, seeks increased spousal support retroactive to June 2010 although conceding that child support for Kendra, who has completed her education and currently holds a fulltime job, should cease as of May 2013.

[2] I must therefore decide the following:

(1) Should Mr. Holman have been required to pay Mrs. Holman child support for daughters Kendra and Paige after they completed their Bachelor’s degrees in May 2011?

(2) If not, is Mr. Holman entitled to a reimbursement of child support payments from May 2011 to today’s date?

(3) Should spousal support be terminated after eight years in May 2011?

(4) Should Mr. Holman be required to continue paying spousal support to Mrs. Holman? If so, for how long?

(5) Should spousal support be increased and if so, should such increase be made retroactive to June 2010?

OVERVIEW

[3] The parties married in 1983. Mr. Holman was a sales representative at a company called Noranda while his wife worked in the local Sheriff’s office. They moved to Halifax for two to three years for Mr. Holman to take up a higher paying job with Noranda. Upon their return to Brampton, Mr. Holman was elevated to the position of Ontario Regional Manager for Noranda. Mrs. Holman did not regain her job at the Sheriff’s office.

[4] On June 10, 1989, the couple had Kendra and Paige. They decided that Mrs. Holman would be a stay home mother.

[5] Eight years later the couple started experiencing difficulties. Mr. Holman wanted his wife to return to work. She did not. Mr. Holman pursued other job opportunities with other companies. He obtained a real estate licence in 2003. His income dropped from a six figure salary to a mere $14,000 that year.

[6] By then the couple had separated. In a motion for child and spousal support Justice Snowie imputed income of $98,000 to Mr. Holman.

[7] He returned to sales and between 2004 and 2012 his annual income increased from $45,594 to $129,000. Mr. Holman also has the use of a vehicle the lease of which is paid for by his employer. He also has use of a company telephone and claims a tax deduction for his home office.

[8] Mr. Holman purchased a home jointly in 2011 with his new spouse. He paid $385,000 for the home. He financed the purchase with a mortgage of $337,247.56 and a $19,000 loan from one of his siblings.

[9] Mr. Holman also contributed a few thousand dollars to an RRSP in 2009.

[10] Mrs. Holman worked at the Peel Memorial Hospital from 1986 to 1989. She returned to work in 1998 to 1999. In 2003 she started a fulltime position with a company which was partly owned by her brother. Her annual income increased from $21,000 in 2003 to $50,360 in 2012.

[11] Mrs. Holman also has savings of $73,000 in one bank and $25,000 in another. Her company pays $579 a month or $6,950 annually for her lease of a vehicle for employment purposes.

[12] In 2003 Mrs. Holman inherited approximately $300,000 from her mother. She used this money to purchase her mother’s home. She spent approximately $135,000 to renovate the home, most of which was financed on her line of credit. The renovations were completed in 2011. The outstanding balance on the line of credit presently stands at $141,000.

[13] Kendra and Paige continue to reside with her. They each earn $23,000-$24,000 annually. Neither pays room and board expenses to their mother.

COURT ORDERS

[14] On April 25, 2003, the court granted Mrs. Holman custody of Kendra and Paige with reasonable access to Mr. Holman. The court ordered the sale of the matrimonial home and adjourned the issues of child and spousal support along with the imputation of income for Mr. Holman.

[15] On July 29, 2003, the court imputed income of $98,612 per annum to Mr. Holman and ordered that he should pay interim child support of $1,215 per month commencing September 12, 2003. The court also ordered Mr. Holman to pay spousal support of $1,400 per month commencing on September 12, 2003 and ordered Mr. Holman to designate his wife as irrevocable beneficiary under his life insurance policies.

[16] Both parties filed “Partial Minutes of Settlement” on September 18, 2003. It provided that:

(1) The proceeds of sale of the matrimonial home be divided equally.

(2) $121,758.03 was payable to Mrs. Holman.

(3) $40,201.72 was payable to Mr. Holman, both amounts being paid in full and final settlement of all claims for equalization.

[17] On April 22, 2004 Mr. and Mrs. Holman were granted a Divorce Judgment with the divorce taking effect on May 23, 2004. The court granted Mrs. Holman sole custody of Kendra and Paige. It fixed child support at $1,215 per month and spousal support at $1,400 per month. It ordered Mr. Holman to pay two-thirds of section 7 expenses with Mrs. Holman paying one-third. The court also ordered that the child support and spousal support shall be variable upon a material change of circumstances including, but not limited to a change in child support, a change in the employment situation of either party, remarriage of Mrs. Holman or her cohabitation for longer than 90 days.

[18] The parties signed further Minutes of Settlement on January 15 and February 10, 2009, which was incorporated into a court order dated March 26, 2009. It provided that commencing September 1, 2008, Mr. Holman would pay child support in accordance with the Federal Child Support Guidelines, S.O.R./97-175 and his annual income of $97,271 as long as the children were children of the marriage under the Divorce Act, R.S.C. (1985) c.3. It provided that Mr. Holman would pay $10,000 annually towards the children’s university education as long as they were enrolled in a post-secondary program. It also mandated Mr. Holman to pay monthly child support of $1,371 for six months commencing March 1, 2009; $833.33 towards the children’s extraordinary expenses; and spousal support of $920 per month.

[19] The March 26, 2009 court order was varied effective May 31, 2009. It provided that effective June 1, 2009, Mr. Holman would pay child support based on the Guidelines and on his annual income of $102,697.90 as long as Kendra and Paige were children of the marriage as defined by the Divorce Act. It also ordered that the parties should continue to exchange income tax returns, notices of assessments and pay slips by May 15 of each year and to adjust support payments effective June 1 if necessary.

ISSUE NO. ONE

[20] Should Mr. Holman have been required to pay Mrs. Holman child support for Kendra and Paige after they graduated in May 2011?

[21] Mr. Holman paid child support, based on the Guidelines for his two daughters from 2003 to the present. Kendra completed a four year degree in Science at the University of Guelph in 2011, while Paige completed a Bachelor’s degree in Social Work in the same year.

[22] In Paige’s third year at university she found out that she would not be graduating with a degree in Social Work as planned. Upon graduating in May 2011 she applied to a college to obtain a Bachelor’s degree in Social Work. She was denied admission in 2012 and 2013 because she did not have the required 75 per cent average. She took two courses in 2012 and is taking an additional five courses in the 2013 fall semester and 2014 winter semester. She intends, if she achieves the requisite 75 per cent average, to enrol fulltime in the Bachelors of Social Work program at college.

[23] Paige earned $23,135 in 2012 and continues to work. I accept Mr. Holman’s testimony that Paige informed him that she did not wish to work fulltime given that it would reduce the amount of time she spends at the gym.

[24] After Kendra and Paige graduated in May 2011, Mr. Holman advised them in writing that he was only prepared to cover the costs related to their first degree. Both responded that they did not have an issue with their father’s position regarding their continuing education. It should be noted that neither testified in the trial nor submitted evidence regarding their expenses.

[25] Kendra successfully completed a two year Veterinary Technician Diploma in 2013. She is currently employed fulltime in her new field and earns $25,000 annually.

[26] Mrs. Holman testified that Kendra and Paige’s post-secondary annual expenses were approximately $22,600. Mr. Holman only contributed $10,000 annually. Mrs. Holman’s parents contributed approximately $52,000 from an RESP to the twin’s university education. In 2011 only Kendra had s. 7 expenses while in 2012, both girls had s. 7 expenses of approximately $10,240.

[27] A determination of this issue involves a consideration of the following two questions:

(1) Is Mr. Holman only required to cover the expenses to his daughters’ first degree?

(2) To what extent are adult children required to use their own funds to pay for their post-secondary education?

[28] Counsel for Mr. Holman submits that Kendra and Paige should be financially responsible for their education after May 11, 2011, and that the income they earned should have been applied to their education thereby negating the need for any child support from him. He relies on a number of cases for the proposition that where an adult child, through employment, is earning sufficient income to satisfy many of the expenses that child support is intended to address, the Guidelines should not be applied in the conventional manner: see Higgins v. Higgins (2001), 106 A.C.W.S. (3d) 1071, 2001 28223 (Ont. Sup. Ct.), at para. 86.

[29] He also submits that the jurisprudence has established that it is reasonable for a child to be able to obtain one degree with the support of a non-custodial parent, and no more: see Vohra v. Vohra, 2009 ONCJ 135, 176 A.C.W.S. (3d) 468 (Ont. Ct. J.), at para. 19; Blaschuk v. Bridgewater (2005), 141 A.C.W.S. (3d) 459, [2005] O.J. No. 3324 (Ont. Sup. Ct.). In the latter case Quinn J. noted at para. 42 that:

Nevertheless, common sense and fairness frequently end the obligation upon, or shortly after, completion of the first undergraduate degree or diploma…In my view, the first question to be asked when considering whether to extend a child support obligation beyond the initial undergraduate degree or diploma is this: Is the educational path upon which the child has been travelling, and upon which he or she wishes to continue travelling, a reasonable one?

[30] Neither s. 7(1) of the Guidelines nor s. 3(2)(b) of the Guidelines provides support for Mr. Holman’s contention that his child support obligations ceased after his daughters completed their first undergraduate degree. On the contrary, s. 7(1)(e) refers to the “expenses for post-secondary education” while s. 7(2) indicates that the guiding principle to be followed under s. 7(1) is “that the expense is shared by the parents or spouses in proportion to their respective incomes after deducting from the expense, the contribution, if any, from the child.”

[31] Furthermore, s. 3(2)(a) of the Guidelines indicate that support for a child the age of majority or over is determined by applying the guidelines as if the child was under the age of majority. Section 3(2)(b) further stipulates that if the court finds this approach to be inappropriate, the appropriate amount should be determined having regard to the condition, means, needs and other circumstances of the child and each parent’s financial ability to contribute to the support of the child.

[32] Based on these provisions, Mr. Holman cannot unilaterally decide that his support obligations automatically ceased after his children completed their first degree. Section 3 of the Guidelines indicates that support should continue by applying the Guidelines as if the child was under the age of majority and that even if this approach is inappropriate, support should reflect a number of factors including each parent’s ability to contribute to the support of their child and the means, needs and circumstances of the latter.

[33] The cases relied upon by Mr. Holman do not support his position that his child support payments should end upon his children’s completion of their first degree. Whether or not his support obligations cease is dependent upon a number of factors including the means, needs and circumstances of the children and each parent’s ability to contribute to child support.

[34] Neither do I necessarily subscribe to the view taken in Blaschuk that common sense dictates that the obligation to provide support necessarily ends upon or shortly after completion of an undergraduate degree or diploma. Indeed, an undergraduate degree in these increasingly competitive times may merely be the first step in the journey to become sufficiently educated for the workplace.

[35] The post-secondary road to become fully qualified in a number of fields such as, for example, law, medicine and teaching, commences with an undergraduate degree. If one were to take Mr. Holman’s position regarding child support to its logical conclusion, adult children would be required to assume huge debts to fulfill their professional ambitions even if their parents possess the means to provide support, and even if they do not have the assets to fully pay for their education.

[36] I am bound by the Ontario Court of Appeal decision in Lewi v. Lewi (2006), 2006 15446 (ON CA), 80 O.R. (3d) 321, at para. 158, that the Guidelines do not indicate that children of majority age with capital assets should contribute all their financial resources towards their post-secondary education before their parents are called upon to provide support or that such child is not required to contribute to their post-secondary education out of their financial resources.

[37] Where, as here, applying the Guidelines to determine the quantum of child support appears to be inappropriate, the combination of s. 7 and s. 3(2)(b) of the Guidelines dictates that the quantum of child support that a parent is required to pay must be determined partly on the basis that an adult child with means will contribute financially towards his or her post-secondary education. The extent of this contribution must be determined by the circumstances of the case including the means of the parents: see Lewi v. Lewi, at para. 159.

[38] Based on the above, Mr. Holman’s support obligation did not automatically end after his daughters completed their first undergraduate degree.

ISSUE NO. TWO

[39] Is Mr. Holman entitled to a reimbursement of child support payments from May 2011 to today’s date?

[40] Kendra earned $10,000 in 2012 and $14,421 in 2011. In the latter year she had approximately $6,000 in expenses. She paid no board and lodge to her mother. The latter paid for her cellphone, groceries and approximately $200 monthly for her clothing.

[41] Mrs. Holman testified that only Kendra had s. 7 expenses in 2011 while both she and Paige had s. 7 expenses of approximately $10,240 in 2012.

[42] Regarding Paige, she only commenced work in November 2011, after earning her degree in May. She was therefore living at home without an income. To that extent she was still dependent on her parents’ support.

[43] In 2012 and 2013, however, Paige either worked fulltime or she worked on a permanent part-time basis. She earned $23,000 in 2012 and is on track to earn $24,000 in 2013. In 2012 she only took two courses. She failed to achieve the grades required to enrol in a Bachelor of Social Work program in college. She is taking more courses in the fall of 2013 and winter of 2014, but it is unknown whether she will gain admission into the program. She does not pay any food and board to her mother while she resides at her home.

[44] In my view, Mr. Holman should not have been required to pay child support for Paige in 2012 and 2013 given her means and the fact that she was not in school for practically the whole time. She plans to enrol in the Bachelor of Social Work program in September 2014 more than three years after she graduated in May 2011. She would have earned approximately $48,000 within this period. She does not pay living expenses to her mother. On the contrary, the latter covers some or substantially all of the costs for her cellphone and clothing and living expenses despite the fact that Paige has the financial means to do so.

[45] To that extent Mr. Holman is entitled to a reimbursement of the amount of child support paid with respect to Paige from January 2012 to the present. This would amount to 50 per cent of the total amount of the child support paid from January 2012 to November 15, 2013 ($47,146.50) or $23,573.25.

[46] Kendra commenced her Veterinary Technician’s program at Seneca College after completion of her degree and completed it at the end of April 2013.

[47] Mr. Homan takes the position that Kendra should be held to be responsible for her schooling and living expenses after May 2011, not only because of her employment income, but also because she was not obliged to do a four year undergraduate degree program before enrolling in the Veterinarian Technician program. He suggests that she could have entered the latter program directly from high school but chose not to.

[48] I disagree that Kendra’s decision to pursue an undergraduate degree before enrolling in the Veterinarian Technician’s program disqualifies her from parental support in the post-May 11, 2011 period. Mrs. Holman provided credible evidence that Kendra initially aspired to be a Veterinarian. Enrolment in the Bachelor of Science program was the prelude for her to achieve this goal. She subsequently realized that her academic goals were beyond her grasp. She then decided, upon graduation, to pursue a more realistic goal within the discipline that she had chosen for a career.

[49] In my view, Kendra should not be punished by being deprived of parental support because of the professional goal she initially set for herself but settled for something else. Indeed, it is to her credit that she did not turn her back on her aspirations after completing her undergraduate degree but chose to pursue a diploma within her chosen field. Mr. Holman should not be relieved of the responsibility to support her because of the educational choices which she reasonably made.

[50] That said, Kendra’s earnings in 2011 and 2012 were such that she should have contributed a portion of her earnings towards her education and living expenses. She earned $14,421 in 2011 and $10,000 in 2012. Her expenses in the latter year was $6,000, while her s. 7 expenses in 2011 was 50 per cent of the $10,000 contributed by Mr. Holman towards her s. 7 extraordinary expenses. She paid no board and lodge to her mother.

[51] Kendra earned sufficient income in 2011 that at the very minimum, she could have contributed $7,000 of her earnings towards her education and living expenses. Furthermore, at least 50 per cent of her 2012 earnings or $5,000 could have been used to cover some of her education and living expenses.

[52] Accordingly, Mr. Holman’s contribution towards Kendra’s support and s. 7 expenses should be reduced by $12,000 for the years 2011 and 2012.

[53] Mr. Holman is also entitled to be reimbursed for the support he paid for Kendra from May to November 15, 2013. He paid $13,407.50 in support payments for his daughters within this period. He is therefore entitled to a refund of 50 per cent of this amount or $6,703.75 representing support payments for Kendra.

ISSUE NO. THREE

[54] Should spousal support be terminated after eight years in May 2011?

[55] Mr. Holman advances the following submissions in support of his position that spousal support in this case should be terminated after eight years:

(1) Mrs. Holman was not disadvantaged either by the marriage or by its breakdown.

(2) Mrs. Holman has long achieved self-sufficiency following the breakdown of the marriage.

(3) The capital positions of both parties justify an end of spousal support. Mrs. Holman is in a much better position than Mr. Holman based on their respective capital positions and that mitigates against any continued spousal support payments to her.

[56] The variation or rescission of an existing order for spousal support is governed by s. 17(4.1) of the Divorce Act. It provides that a change in the condition, means, needs or other circumstances of either former spouse since the making of the spousal support order or the last variation order warrants a variation of an existing spousal support order. Section 17(7) of the Act provides that any variation order should have the following objectives:

(a) recognize any economic advantages or disadvantages to the former spouses arising from the marriage or its breakdown;

(b) apportion between the former spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;

(c) relieve any economic hardship of the former spouses arising from the breakdown of the marriage; and

(d) in so far as practicable, promote the economic self-sufficiency of each former spouse within a reasonable period of time. Section 15.2(6)

[57] A determination of the “condition, means, needs and other circumstances of each spouse” necessarily involves a consideration of the length of cohabitation: see Fisher v. Fisher 2008 ONCA 11, 88 O.R. (3d) 241 (C.A.), at para. 35.

[58] An assessment of the roles and functions during the marriage may involve a determination of whether either spouse assumed a greater proportion of non-economic responsibilities such as homemaking, or child caring and the extent to which these responsibilities negatively impacted the spouse’s career goals.

[59] Regarding the objectives set out in s. 17(7), economic advantage or disadvantage is the basis for compensatory support: see Fisher, at para. 50.

[60] A determination of self-sufficiency involves an assessment of the parties’ present and potential income, their standard of living during marriage, the efficacy of any suggested steps to increase a party’s means, the parties’ post-separation circumstances (including the impact of equalization of their property), the duration of their cohabitation and any other relevant factors: see Fisher, at para. 53.

[61] Turning to Mr. Holman’s first submission, the parties got married in 1983. They moved to Nova Scotia one year later to enable Mr. Holman to take up a better paying job with his company. Mrs. Holman gave up her job at the Sherriff’s office to enable her husband to pursue better opportunities with his company. She cashed in her pension and maintained the couple’s home for the two years they lived in Nova Scotia. She worked in a local hospital until she gave birth to Kendra and Paige in 1989. She stayed at home to care for them until she returned to work in 1998-1999.

[62] It is clear, based on this chronology of events, that Mrs. Holman was disadvantaged on account of her marriage. She relinquished her job to ensure that Mr. Holman pursued employment opportunities. She remained at home to ensure that he could fully maximize his income potential. Indeed, Mr. Holman testified that he was required to attend a number of work related functions while Mrs. Holman remained at home caring for Kendra and Paige. His employment success was achieved to a significant degree on account of her sacrifice.

[63] Did Mrs. Holman suffer economic disadvantage on account of the marital breakdown in 2003? Mr. Holman argues that she did not given that she acquired $160,000 in equity which she still retains in various forms.

[64] Mrs. Holman left the marriage with $38,000 in RRSPs and $121,000 in cash.

[65] Mrs. Holman purchased a house with her share of the net family property following her divorce. Her mother passed away in August 2010 leaving Mrs. Holman a one-third share of her mother’s $936,000 estate.

[66] I note parenthetically, that Mrs. Holman submits that her inheritance should not be considered in the assessment of spousal support. However, any such inheritance must be considered, pursuant to s. 33(9)(a) of the Family Law Act, R.S.O. 1990, c. F.3which provides that the determination of spousal support involves a consideration of a number of factors including “the dependent’s and respondent’s current assets and means”: see Rothenburg v. Rothenburg (2003), 122 A.C.W.S. (3d) 117, 2003 2229 (Ont. Sup. Ct.), at para. 46.

[67] Mrs. Holman used her inheritance to purchase her mother’s home plus another $64,200 which she netted following the sale of her home for $269,000. Mrs. Holman invested $75,000 she received as part of her divorce settlement into an RRSP account.

[68] Upon purchase of her mother’s home, Mrs. Holman incurred approximately $140,000 debt to conduct extensive renovations of the home.

[69] Mrs. Holman conceded under cross-examination that before she sold her home in 2010 she was not accumulating any debt and on the contrary was reducing her mortgage. She conceded, however, that she accumulated $60,000 on her line of credit. She paid down this line of credit upon sale of her home. Since 2010, the balance on her line of credit increased to $97,000 by May 2012 and to $141,000 by August 2013. This increase cannot be attributed to the renovations to her home given that they were completed in 2011.

[70] When asked for the reasons for the increase in the outstanding balance of her line of credit, Mrs. Holman replied, “I don’t know why.”

[71] Mrs. Holman also agreed that she contributed $10,000 to her RRSP in 2012 and that her disposable income in 2012, which included $24,000 in child support, was $72,000.

[72] Clearly, Mrs. Holman’s financial situation does not support her testimony that, “I live like a pauper.” If anything, the unexplained increase in Mrs. Holman’s line of credit and the costly renovations to her home indicate that she may well be living beyond her means.

[73] If the yardstick for measuring economic disadvantage arising from marriage breakdown is an inability to meet basic needs, then Mrs. Holman was not disadvantaged on account of the breakdown of her marriage. Indeed, Mrs. Holman appears to have had sufficient financial resources to cover food and living expenses for Kendra and Paige although they had the financial means to contribute to their own upkeep.

[74] Neither is it possible to conclude that Mrs. Holman experienced a lower standard of living after the breakdown of the marriage. She received a handsome settlement and used a portion of it to purchase a home. She commenced working fulltime at the company co-owned by her brother and has worked her way in the company to become a Collections Administration Manager, with certain privileges such as driving a car paid for by her company.

[75] Has Mrs. Holman achieved self-sufficiency following the breakdown of her marriage? She will earn approximately $52,000 in 2013 in addition to car leasing benefits of approximately $7,000 annually. Her present standard of living is either comparable to that she enjoyed during marriage or likely exceeds it largely because of the legacy she received from her mother. She has received spousal support for ten years. The equalization of the net family property provided her with the means to own her own home. Her financial circumstances were vastly improved following receipt of an inheritance from her mother in 2010. Her house is worth more than $500,000 and has no mortgage attached to it. She has also received child support payments from Mr. Holman for at least eight years. She also has approximately $100,000 in savings.

[76] In my view, Mrs. Holman has achieved self-sufficiency following the breakdown of her marriage. The fact that she has a significant outstanding balance on her line of credit is not attributable to her marriage or its breakdown but spending decisions she made following the purchase of her mother’s home in 2010.

ISSUE NO. FOUR

[77] Should spousal support end on account of the capital positions of Mr. and Mrs. Holman?

[78] Mr. Holman’s share of his home is $200,000 in which he has equity of approximately $40,000. He has approximately $100,000 in RRSPs. Mr. Lee Hill, an experienced realtor whose expertise in assessing the value of real estate was not challenged, opined that if Mr. Holman’s property increased at the annual rate of 5 per cent, as they have done historically according to Mr. Hill’s testimony, then Mr. Holman will have an additional $60,000 equity in his home when he retires in six years at age 65 for a total of $100,000.

[79] Mr. Hill testified that he estimated the market value of Mrs. Holman’s home to be $519,000. When her $141,000 is factored in, the value of her equity is $378,000. If this value increases annually by 5 per cent over the next six years, Mrs. Holman’s equity would have increased by $155,700 for a total of $535,700.

[80] Mr. Holman relies on the proposition that in assessing the needs of Mrs. Holman and his ability to pay spousal support the court must take into account the equalization payment of $160,000 received by Mrs. Holman and the capital position of both: see Fitzpatrick v. Fitzpatrick (2004), 132 A.C.W.S. (3d) 323, [2004] O.J. No. 2695 (Ont. Sup. Ct.), at para. 106; Baloban v. Baloban (2006), 154 A.C.W.S. (3d) 429, [2006] O.J. No. 5240 (Ont. Sup. Ct.), at para. 38.

[81] Mrs. Holman further submits that indefinite spousal support is typically appropriate following a long term marriage over 20 years because the dependent spouse is often of an age that makes it difficult or nigh impossible to achieve economic self-sufficiency: see Fisher, at para. 35. Mr. Holman relies on Fisher and Baloban for his submission that spousal support in this case should terminate in May 2011.

[82] In Fisher the 42 year old husband unilaterally ended the 19 year marriage in 2004. His 41 year old wife lost her $35,000 job due to depression. The wife sought support on account of economic hardship. The trial judge awarded her support of $2,600 from March 1 to December 1, 2006; $1,800 for 2007 and $1,050 for 2008. On appeal, the Court of Appeal held that the wife needed support for seven years to enable her to become financially independent or adjust to a lower standard of living within seven years: see Fisher, at para. 115.

[83] Fisher, however, does not stand for the proposition that seven years spousal support is the outside limit following a 19 year marriage. The wife was a decade younger than Mrs. Holman and had a better paying job than the latter before the termination of the marriage. Furthermore, the parties in Fisher had no children and the wife was not required to remain at home for a decade caring for any children of the marriage. In Fisher, the court found that the wife suffered no established economic disadvantage arising from the marriage unlike the case here. The need for a compensatory order for spousal support is therefore much greater in this case than in Fisher.

[84] In Baloban, the couple separated following an 18 year marriage. They had two adult children, age 27 and 24, who continued to reside with their mother. The husband was 60 years old while the mother was 58 when the couple separated. Pursuant to Minutes of Settlement, the husband was required to pay $700 per month spousal support based on an annual income of $94,000 and on his estranged wife’s income of $27,000 annually. The order mandated the husband to pay spousal support until his retirement in 2010. The court increased spousal support in 2001 to $3,000 monthly after the husband’s income increased to $171,000 annually.

[85] In 2003, however, the husband lost his job. He subsequently obtained employment but at a drastically reduced rate of $36,000 annually plus an $8,000 car allowance. A court order in November 2004 reduced spousal support to $1,500 monthly. The husband again lost his job in 2005 and he then brought an application to vary his support payments. Following his termination, he subsisted on the monthly amount of $1,602 from a fund which he commenced with the proceeds of a pension RRSP. His net worth was $359,385 compared to $364,960 for his wife.

[86] The reason for the termination of spousal support in Baloban after seven years is conspicuous by its absence in this case. The court held that the husband was using the major part of his net worth, in the form of locked funds in a Life Income Fund to generate income to satisfy his needs and to pay spousal support: see Baloban, at para. 48. The wife, on the other hand, had done very little to utilize her net worth to generate income. The court held that it would neither be just or appropriate for her to maintain her capital without risk as may be necessary to generate income and yet require her husband to do so to share his income with her: see Baloban, at para. 49.

[87] By contrast, Mr. Holman earns a significant income of approximately $130,000 annually. That does not include a number of benefits including use of a company car, cellphone and the writing off of expenses associated with his home benefits. These benefits likely increase his annual income by at least $10,000. Mr. Holman is not required to rely on interest from his RRSP for his basis needs.

[88] For the above reasons, spousal support in this case should not be terminated after seven years. Mr. Holman has the means to pay support. Furthermore, the fact that Ms. Holman has been economically disadvantaged because of the marriage means that the compensatory justification for spousal support in this case is greater than in Fisher and Baloban. In my view, Mr. Holman should be required to pay spousal support up to November 1, 2013, given his means, Mrs. Holman’s needs and the economic disadvantage she suffered during the course of her marriage.

ISSUE NO. FIVE

[89] Should spousal support have been increased after June 2010?

[90] Mrs. Holman justifies her request for an increase in spousal support from the current amount to $2,000 monthly. She submits that her needs justify the increase and secondly, Mr. Holman’s failure to provide his financial information in accordance with the provisions of the last court order gives the court the discretion to order retroactive payment from the date of the order.

[91] Mrs. Holman’s financial statement, dated August 16, 2013, indicates that her total annual income is $73,898.88 while her annual expenses amount to $87,905.40, with an annual deficit of $14,006.52 or $1,167.21 monthly.

[92] A perusal of the financial statement, however, suggests that Mrs. Holman is overspending on a number of items. For example, she spends $400 monthly on telephones and cable and $1,120.00 monthly on groceries. Despite having a vehicle that is only a few years old, she indicates that repairs and maintenance costs account for $400 a month; an amount that does not include gas and oil which account for $550 a month. Additionally, Mrs. Holman claims monthly expenses of $275 for school fees, presumably for Kendra, and another $200 a month for clothing for her children. If Mrs. Holman’s expenses for telephone, groceries and repairs and maintenance are halved and her expenses for school fees and children’s clothing eliminated, her expenses can be drastically reduced by $1,435 monthly or $17,220 annually. Additionally, Mrs. Holman’s financial statement does not show the approximately $6,950 in car lease benefits that she annually receives from her company. Based on these estimates, Mrs. Holman should have no difficulty in meeting her monthly expenses.

[93] The final order signed by both parties contemplated that by May 15 of each year the parties shall exchange income tax returns as long as their support obligations remain and that they adjust support payments effective June 1 if necessary. Mr. Holman was therefore obliged to provide this information on May 15, 2011, May 15, 2012 and May 15, 2013, subject only to a further agreement or court order.

[94] Given Mr. Holman’s income in these years, the $1,422 monthly support should have been increased to reflect Mr. Holman’s increased annual income. Mr. Holman’s income in 2011 was $120,000 and $129,000 in 2012. Mrs. Holman’s annual income in 2011 and 2012 was $42,415 and $50,360 respectively.

[95] The Spousal Support Guidelines indicate that in 2011 Mr. Holman should have paid spousal support, based on Mrs. Holman having two dependent children, of a low $1,187 and a high $1,894 with a mid-point of $1,539 monthly. Based on Mr. Holman having one dependent child in 2012, he should have paid a low $1,244 monthly to a high $2,117 monthly with a mid-point of $1,670 monthly, with Mr. Holman’s income being $129,000 and Mrs. Holman’s income being $50,360 annually.

[96] For the 12 months from June 1, 2011 to June 1, 2012, I find that Mr. Holman underpaid spousal support of approximately $117.00 (i.e. $1,539 - $1,422) per month or $1,404. For the period between June 1, 2012 to May 1, 2013, he underpaid spousal support by approximately $2,728 ($248 x 11 months). Based on the same figures, he underpaid spousal support of slightly more than one half of that amount (i.e. $1,488 for the six and a half month period between May 1, 2013 and November 15, 2013). He therefore underpaid spousal support of approximately $5,620.

[97] The February 2010 order required Mr. Holman to pay $1,437 per month while Kendra and Paige resided with their mother. Based on his 2011 income and the support guidelines, Mr. Holman should have paid $1,660 or $223 more while from June 1, 2012 to May 1, 2013 (the date when Kendra became employed fulltime), he should have paid child support of $1,107 monthly, based on the Guidelines, rather than $1,437 per month. For the 11 month period between June 1, 2012 and May 1, 2013, Mr. Holman overpaid $3,630 in child support payments to Mrs. Holman. If this amount is deducted from the $5,620 he underpaid in spousal support from June 1, 2011 to November 15, 2013, he underpaid spousal support in the amount of $1,990.

SUMMARY

[98] Based on the above, I conclude that:

a) Mr. Holman’s obligation to pay child support for daughter Paige terminated at the end of 2011. Given her income for the 2012 to the present, Mr. Holman was no longer obliged to financially support her.

b) Mr. Holman’s obligation to pay child support for Kendra terminated May 1, 2013.

c) Mr. Holman’s obligation to pay spousal support did not end in May 2011 but continued to November 15, 2013. Spousal support is therefore terminated as of this date.

d) Mr. Holman is entitled to a refund of child support and s. 7 expenses of $42,277 (see paragraphs 45, 52 and 53). This amount will be reduced by $1,990 which Mr. Holman underpaid in spousal support payments between June 1, 2011, and November 1, 2013. Mr. Holman is therefore entitled to a refund of $40,287 in child support payments.

e) Effective November 14, 2013, Mr. Holman is no longer required to designate his wife as the irrevocable beneficiary under his life insurance policies.

[99] Regarding the costs of this trial, if the parties cannot agree they may make brief written submissions. The applicant shall make written submissions within 15 days of the release of this decision; the respondent will have 15 days to respond.

André J.

Released: November 22, 2013