COURT FILE NO.: 32235/10

DATE: 2013-01-25

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: GINA MUSTAFA, Applicant

AND:

USAMA ABDELSALEM, Respondent

BEFORE: MURRAY J.

COUNSEL: R.P. Zigler, Counsel for the Applicant

Stuart M. Law, Counsel for the Respondent

HEARD: October 23, 2012

ENDORSEMENT

[1] The respondent brought a motion to change a final order of Madam Justice Coats made on February 25, 2011. The applicant brought a cross-motion also seeking a variation in the order of Madam Justice Coats.

The Evidence

[2] The parties were married on August 2, 1994 and separated on August 1, 2009. There are two children of the marriage, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997.

[3] The applicant commenced proceedings in January, 2010. After what was described as acrimonious litigation, the parties entered into Minutes of Settlement which resulted in a final order being made by Madam Justice Coats on February 25, 2011.

[4] These motions came before me initially on October 23, 2012. I reserved my decision on the motions until the parties provided further information and further submissions which were provided in November and December pursuant to my interim order dated October 24, 2012.

[5] The February 25, 2011 order of Madam Justice Coats was made on consent pursuant to Minutes of Settlement filed by the parties. The relevant provisions of the order provided:

1. The parties have joint custody of the children, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997;

2. The children shall reside primarily with the applicant with reasonable access to the respondent;

3. The respondent shall pay child support based on his disclosed income of $1,842 per month based on an annual income of $137,000;

4. Child support is to be adjusted on January 1^st of each year so that the amount payable corresponds to the Guideline amount based on the income of the payor in the preceding calendar year;

5. The children's cell phones are to be transferred to the applicant;

6. The respondent shall pay spousal support in the amount of $2,400 per month based on his anticipated 2011 income of $125,000;

7. There is to be an annual cost-of-living increase adjustment to spousal support commencing in April 2012 based on the year-over-year CPI for Toronto;

8. Spousal support is payable until February 1, 2021

[6] In September of 2011, the two children began living with the respondent on a full-time basis. The respondent's motion to change was not filed until January 6, 2012 following a lengthy delay in having the order of Madam Justice Coats issued and entered.

[7] On December 22, 2011, Justice Daley made a temporary, without prejudice order granting the respondent leave to file his motion to change, varying the order of Madam Justice Coats with respect to the children's residence, suspending Justice Coats order for child support and requesting the Office of the Children's Lawyer to conduct an investigation and make recommendations regarding custody and access. Justice Daley’s order was not issued, entered and forwarded to the FRO until September 2012.

[8] The Office of the Children's Lawyer completed an investigation and recommended that the two children of the marriage continue to reside primarily with the respondent and that the parties continue joint custody.

[9] The respondent paid child support to the applicant from September, 2011 to December, 2011 in the amount of $1,842 per month to the applicant when the two children were residing with him.

[10] The applicant paid no child support for the children during the four-month period from September, 2011 and has paid no child support thereafter. It is not in dispute that the applicant's income, based on her financial statement sworn December 19, 2011, is $28,200 for 2011 and 2012 is $33,000.

[11] The gross annual income of the respondent is and has been for a number of years with his current employer based on a combination of base salary, bonus, overtime payments and vacation pay. Because it is relevant to the motion of the applicant to have an increase in spousal support, it is useful to set out some history of the earnings of the respondent.

[12] The respondent's base salary increased incrementally from $84,000 in 2005 to $122,741 in 2011. During that same period, he worked substantial overtime, received bonus payments and had a fluctuating aggregate income. According to the evidence, his income during that period of time was as follows:

1. in 2005, his aggregate income was $113,880, and included in that aggregate income was a base salary of $84,000, $25,078 in overtime payments, and a bonus of $766;

2. in 2006, his aggregate income was $119,200, and included in that aggregate income was a base salary of $89,800, $18,700 in overtime payments, and a bonus of $1,500;

3. in 2007, his aggregate income was $158,900, and included in that aggregate income was a base salary of $98,600, $45,700 in overtime payments, and a bonus of $1,900 and;

4. in 2008, his aggregate income was $151,550, and included in that aggregate income was a base salary of $106,000, $42,500 in overtime payments, and a bonus of $2,400;

5. in 2009, his aggregate income was $165,300, and included in that aggregate income was a base salary of $117,500, $33,800 in overtime payments, and a bonus of $2,700;

6. in 2010, his aggregate income was $136,600, and included in that aggregate income was a base salary of $118,000, $11,500 in overtime payments, and a bonus of $200;

7. in 2011, his aggregate income was $188,900, and included in that aggregate income was a base salary of $122,700, $36,800 in overtime payments, and a bonus of $800;

8. in 2012, up to October 3, 2012, the respondent had received $102,700 in base salary and had received $2,700 in overtime payments but had not been paid a bonus. His aggregate earnings to October 3, 2012 were $125,400.

The Respondent's Motion to Change

[13] The respondent brought a motion to vary custody, child support and spousal support as provided in the order of Madam Justice Coats of February, 2011. The respondent sought the following orders:

1. an order that the primary residence of the children be with the respondent;

2. a declaration that he has overpaid child support by $7,368 for the period from September 2011 and thereafter;

3. an order that the applicant is obligated to pay Guideline support commencing September 1, 2012 for the two children, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997.

The Applicant in Her Cross-Motion Sought the Following:

1. a variance of the order of Madam Justice Coats eliminating her obligation to pay for cell phones on an ongoing basis;

2. an increase in spousal and child support for 2011 based on the respondent's increased earnings;

[14] On October 23, 2012 when these motions were first before the Court, the parties consented to the following orders:

1. that the primary residence of the children would be varied to provide that they reside with the respondent in accordance with the recommendations of the Children's lawyer;

2. that the applicant shall pay child support to the respondent for the period from September 1, 2011 (the effective date of the change of residence of the two children) to December 1, 2011 in the amount of $423 per month based on her 2011 income of $29,000 and further that she shall pay child support effective January 1, 2012 in the amount of $481 per month based on her 2012 annual income of $33,000.

[15] The effect of this consent to vary the order of Madam Justice Coats is that there is no need for the Court to make a ruling with respect to the respondent's motion to change. His motion is, in the main, conceded. The change of residence of the children is a material change in circumstances and from that material change in circumstances his obligation to pay child support is terminated effective August 31, 2011 and the obligation of the applicant to pay Guideline support is triggered.

[16] The parties agree that the respondent had overpaid child support based on the change of residence of the two children by $7,368 as a result of payments made in the four months from September 1, 2011 to December 31, 2011 after the two children had commenced residence with the respondent. The respondent is entitled to a credit for such overpayment.

[17] The parties also appeared to agree on amounts of child support payable by the applicant to the respondent after the change of residence of the two children and the amount of arrears owed by her. Subject to minor adjustments to make the consent consistent with the original order of Madam Justice Coats, the Court will make the requisite orders pursuant to such consent. The minor adjustments to which I refer result from the fact that I have a very modest disagreement with some of the calculations made with respect to the Guideline child support payments required by the applicant and with the calculation of arrears owed by her.

[18] The order of Madam Justice Coats provides, in para. 21, that on January 1^st of each year, Guideline child support payments shall be adjusted by the income of the party in the preceding calendar year. Notwithstanding the consent, it is my view that the obligation of the applicant to pay Guideline child support for the two children of the marriage commencing on September 1, 2011 should be based on her 2010 income. On January 1, 2012, her Guideline support obligations would be adjusted based on her 2011 income. This is what the order requires. There is no reason to change the order. Therefore, the applicant’s child support obligations and any arrears resulting therefrom should be re-calculated on this basis. It flows from this that on January 1, 2013, the applicant’s Guideline child support obligation is to be based on her 2012 income.

The Applicant's Motion to Change

[19] The applicant sought an order retrospectively varying child-support for the eight-month period from January 1, 2011 to August 31, 2011 when the respondent paid support in the amount of $1840.02 per month. It is the applicant's position that the Guideline amount, based on the respondent’s income, ought to have been adjusted to $2,445 per month. According to the applicant the respondent therefore should be required to pay her an additional $4,824 in child support for the eight-month period in question (8 x $603).

[20] In addition, the applicant seeks retroactive variation of spousal support to $4,155 per month for the period of January 1, 2011 to August, 2011 for the period of time during which the children resided with the applicant. Pursuant to this request, the applicant seeks an additional $14,064 from the respondent based on her claim that she was entitled to an increase over the amount being paid of $1,755.80 per month for the eight-month period noted. The applicant is not seeking a variation beyond this eight-month period in 2011 when the children resided with her. The applicant suggests that this amount be paid at the rate of $200 per month thus causing a minimal additional burden on the payor respondent. The applicant recognizes that the fluctuations of the respondent’s income logically supports a conclusion that it would not be appropriate to fix a new spousal support figure without at the same time building into it a review mechanism the administrative cost of which would likely exceed any benefit the parties.

[21] Therefore, the remaining issues in dispute and to be resolved by this Court are as follows:

1. Should the child support payable by the respondent to the applicant be adjusted for the period from January 1, 2011 to August 31, 2011 be adjusted based on the applicant's income at that time.

2. Is the applicant entitled to an increase in spousal support in 2011 for the period from January 1, 2011 to and including August 1, 2011, that is the period of time during which the children resided with the applicant?

3. Is the applicant entitled to an order eliminating the obligation to pay for cell phones on an on-going basis?

Analysis

[22] As noted above, pursuant to the Minutes of Settlement which is set out in the order of Madam Justice Coats, child support is to be adjusted on January 1^st of each year so that the amount payable corresponds to the Guideline amount based on the income of the payor in the preceding calendar year.

[23] The obligation set out in the order of Madam Justice Coats required a child support payment in the amount required by the Guidelines based on the respondent’s income of $137,000. The respondent's income in 2010 was $136,593.73. The respondent made child support payments in accordance with the order of February 25, 2011 and pursuant to that order, no adjustment was required for the period from January 1, 2011 to August 31, 2011. Both the Minutes of Settlement between the parties and the order of Madam Justice Coats provide for the annual adjustment of child support based on the actual income earned by the respondent in the previous year. The next date for adjustment of child support payable by the respondent to the applicant would have been on January 1, 2012 when child support payments would have been adjusted and the respondent would have been required to pay child support - on a go forward basis - based on his 2011 income. However, the children of the marriage did not continue to reside with the applicant until January 1, 2012. The children commenced living with the respondent on or about September 1, 2011. The respondent paid his child support obligations when the children were residing with the applicant in accordance with the order and in accordance with the agreement of the parties. There is no merit in the applicant's request for an adjustment of child support for the period from January 1, 2011 to August, 2011. In this regard, see Willick v Willick, [1994] 3 S.C.R. 670.

[24] The applicant and the respondent put their minds to the adjustment of spousal support and agreed that increases in spousal support would be annual in accordance with the change in the Toronto year-over-year Consumer Price Index. At the time of the execution of the Minutes of Settlement, the applicant was fully aware that the respondent’s income was variable, being comprised of a base salary, overtime pay and bonus. Indeed, as can be seen from the history of the respondent’s income above, in 2007, 2008 and 2009 his aggregate income was significantly in excess of his income in 2010. At the time of the February 2011 order of Madam Justice Coats, the respondent did not know what his aggregate overtime payments and bonus would be for the 2011 calendar year. In fact, the respondent’s base salary in 2011 was $122,700. The parties agreed that they would base his spousal support obligation on his 2010 income of $137,000 without allowing for any future adjustments based on variables of overtime and bonus. In sum, being perfectly aware of the potential for fluctuations in the respondent's income due to the respondent's ability to perform voluntary overtime in order to earn income over and above his base salary, the applicant agreed to pay spousal support on an income of $137,000 and provided for future adjustments based on changes in the CPI. Indeed, it is ironic that the applicant now recognizes that the fluctuations of the respondent’s income makes it inappropriate to fix a new spousal support figure without at the same time building into it a review mechanism the administrative cost of which would likely exceed any benefit to the parties. In my view, it is evident that when the parties entered into Minutes of Settlement just prior to the order of Madam Justice Coats, they also rejected the notion of a review mechanism. The adjustment they agreed to was an annual cost of living adjustment in accordance with the Toronto CPI.

[25] Material change means a change that if known at the time would likely have resulted in different terms in the order. If the matter which is relied on as constituting a change was known at the relevant time, it is not to be relied on as a basis for variation. In L.M.P. v. L.S., 2011 SCC 64, [2011] 3 S.C.R. 775 at paragraph 39, the Supreme Court of Canada stated that:

Even significant changes may not be material for the purposes of s. 17(4.1) if they were actually contemplated by the parties by the terms of the order at the time of the order. The degree of specificity with which the terms of the order provide for a particular change is evidence of whether the parties or court contemplated the situation raised on an application for variation, and whether the order was intended to capture the particular changed circumstances. Courts should give effect to these intentions, bearing in mind that the agreement was incorporated into a court order, and that the terms can therefore be presumed, as of that time, to have been in compliance with the objectives of the Divorce Act when the order was made.

[26] I agree with the respondent that there has been no material change to warrant a variation in the spousal support order made by Madam Justice Coats. The applicant's motion to seek an adjustment for spousal support for the period from January 1, 2011 for the eight-month period ending August 31, 2011 is dismissed.

Decision

THIS COURT THEREFORE MAKES THE FOLLOWING ORDER:

[27] The order of Madam Justice Coats dated February 25, 2011 shall be changed as follows:

1. Effective September 1, 2011, the primary residence of the children, Yousef Abdelsalem born on February 18, 1996 and Sarah Abdelsalem born on November 2, 1997, shall be with the respondent in accordance with the recommendations of the Children's lawyer;

2. The obligation of the respondent to pay child support to the applicant for the two children of the marriage, Yousef Abdelsalem born on February 18, 1996 and Sarah Abdelsalem born on November 2, 1997, is terminated effective August 31, 2011.

3. The applicant shall pay Guideline child support to the respondent for the two children, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997, in the amount of $375 per month for the period from September 1, 2011 (the effective date of the change of residence of the two children) to December 1, 2011 based on her 2010 annual income of $25,000 and shall pay the respondent arrears of $1,500.

4. The applicant shall pay Guideline child support for the two children, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997, to the respondent from January 1, 2012 to December 31, 2012 in the amount of $411 per month based on her 2011 annual income of $28,200 and shall pay to the respondent arrears of $4,932;

5. The applicant shall pay Guideline child support for the two children, Yousef Abdelsalem born February 18, 1996 and Sarah Abdelsalem born November 2, 1997, commencing January 1, 2013, in the amount of $481 per month and monthly thereafter on the first of each and every month based on the applicant’s 2012 annual income of $33,000.

6. Support deduction order to issue.

THIS COURT FURTHER DECLARES;

1. That the respondent overpaid child support based on the change of residence of the two children from the applicant's residence to his residence on September 1, 2011 by $7,368 for payments made in the four months from September1, 2011 to December 31, 2011 after the change of residence occurred.

2. That the respondent is entitled to a credit for such overpayment of child support in the amount of $7,368.

[28] I have set out the basis on which the applicant's Guideline child support payments should be made. That is, child-support payments are based on the payor’s previous year’s income. If the parties have a dispute relating to the accuracy of the quantification of amounts owing by the applicant to the respondent for Guideline child support as a result of the change of residence of the two children, I remain seized for purposes of resolution of any such dispute.

[29] There was no apparent problem between the parties with respect to the applicant’s access after the change of residence of the two children. Should there be any unresolved issue with respect to the applicant’s access rights, the Court remains seized with respect to this issue.

[30] Finally, it appears that the issue with respect to the payment for cell phones for the children is not finally resolved. In my view, it is important to resolve this issue and if there is no agreement with respect to the resolution of this matter, then the Court remains seized with respect to this issue as well. I am not certain I need further submissions on this point. However, if either party wishes, I am happy to entertain submissions in the most efficient way practicable.

[31] With respect to the issues for which I remain seized, any dispute should be resolved efficiently and at minimal cost to the clients. For this purpose, I would be prepared to hear from both counsel on any unresolved issue by way of telephone conference if this is suitable and convenient. If the parties wish to appear, I am prepared to have a special motion at 9:30 a.m. any day I am in Milton, Ontario in order to facilitate an expeditious resolution of this matter.

[32] The parties should contact my assistant prior to February 8, 2013 in order to advise if there are any issues left to be resolved and the manner of their resolution.

Costs

[33] The respondent has been successful and is entitled to costs. If the parties are not able to resolve the matter of costs, then the Court will entertain submissions with respect to quantum and scale. Such submissions are to be dealt with as suggested above either by telephone conference or court appearance at the same time as other unresolved issues.

[34] If costs are the only unresolved issue, then the parties may make brief written submissions. The respondent shall have his submissions filed no later than February 28, 2013 and the applicant shall have her written costs submissions filed no later than two weeks after receipt of the cost submissions made by the respondent.

MURRAY J.

Date: January 25, 2013