COURT FILE AND PARTIES

COURT FILE NO.: FS-13-019151

DATE: 20140526

SUPERIOR COURT OF JUSTICE – ONTARIO

RE: EMILIA BALMEO, Applicant

AND:

ERNESTO BALMEO, Respondent

BEFORE: C. Horkins J.

COUNSEL:
Dorthea Dadson, for the Applicant

Sanka Wijeratne, for the Respondent

HEARD at Toronto: May 20, 2014

ENDORSEMENT

[1] The applicant brings a motion for child support and spousal support retroactive to the date of separation on August 1, 2013.

[2] The parties were married on February 15, 2000 and separated on August 15, 2013. They have one child born April 26, 2002.

[3] The respondent left the matrimonial home and the applicant and child continue to live in the house. The parties are in the process of deciding what to do with the house as there is some equity in it. Custody of the child is in dispute.

[4] During the marriage, the respondent worked as did the applicant. For some period of time the applicant stayed home to care for the child. It is not clear when she returned to work. She has a job as a personal support worker and was working full time when she was injured in a car accident in October 2012.

[5] The respondent is employed as a full time machine operator at Lincoln Electric. A letter from his employer states that he has worked at this company since 2004 and is a valuable member of the team. His base pay is $15.79/hour. He has an opportunity to earn more money if sales are strong and could earn over $20/hour. It is not clear if the increase in hourly pay is due to overtime or how often his pay is above the base.

[6] The respondent says that with a base pay of $15.79 and working approximately 80.5 hours in a two week period, that his base yearly pay without bonus is $46,514.16. I note that this base pay does not factor in the opportunity to earn more at a rate of $20/hour or higher. The respondent did not provide any evidence about when he has been paid more than $15.79/hour.

[7] As well, the respondent is eligible to participate in the company year-end Incentive Profit Sharing Program (“bonus”). The bonus depends on the respondent’s performance and the company’s business results. The letter states that they have experienced “bonuses as high as 40% to a low of 0%”. It is not clear if this is a percentage of the employee’s base earnings. The last few years have been extremely good for the company resulting in bonuses for the respondent.

[8] The respondent’s line 150 income is as follows:

2011 $72,396

2012 $87,515

2013 $78,518

[9] There is no evidence to show what part of the respondent’s line 150 income was hourly pay, at the base rate or some higher rate, or bonus.

[10] The applicant’s line 150 income is as follows:

2010 $35,470

2011 $36,064

2012 $32,387

[11] The applicant states that she is currently working on a part-time basis and she is also on call. She says that she is currently unable to work full time because of the injuries she suffered in the car accident. The accident happened in October 2012. A letter dated April 10, 2014 from Dr. Meneses, the applicant’s family doctor, states that she was off work after the 2012 accident for four weeks and then returned part-time. In March, she went back to work three days a week with modified duties and “graduated to full time regular duty on April 16, 2013”. The doctor last saw the applicant on February 20, 2014. The doctor notes that the applicant continued to feel “dizziness, residual back pains and heaviness on prolonged walking standing lifting and while doing the natural course of her work duty, but this does not interfere with her regular work activities.”

[12] I cannot accept the applicant’s evidence that she is unable to work full time. Her family doctor states that she returned to full time work as of April 16, 2013 and that her complaints do not interfere with her regular work activities. Therefore when considering her claim for spousal support, I am assuming that she earns a full time wage consistent with what she earned before the accident.

[13] The respondent takes the position that the bonus part of his line 150 income should be removed and that child support and spousal support should be based on his base salary. This is because he does not know from year to year if he will get a bonus and if so how much. He proposes that each year, if he is paid a bonus, he will adjust what additional child support ought to have been paid and will pay the applicant a lump sum. His difficulty now is that he has already spent the bonus that he was paid at the end of 2013. As a result, the applicant would have to wait until the end of 2014 to receive the full amount of child support for this year.

[14] The presumptive rule is that the respondent shall pay child support based on his line 150 income. The respondent relies on s. 17(1) of the Federal Child Support Guidelines, SOR/97-175 (“Guidelines”) that states:

17. (1) If the court is of the opinion that the determination of a spouse’s annual income under section 16 would not be the fairest determination of that income, the court may have regard to the spouse’s income over the last three years and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years.

[15] In my view, s. 17 does not help the respondent since over the last three years he consistently received a bonus. His average line 150 income over the three years was $79,476.

[16] The respondent also relies on s. 10 of the Guidelines that allows the court to award an amount for child support that is different from the Guidelines amount if the payor would suffer undue hardship. Section 10 states as follows:

10. (1) On either spouse’s application, a court may award an amount of child support that is different from the amount determined under any of sections 3 to 5, 8 or 9 if the court finds that the spouse making the request, or a child in respect of whom the request is made, would otherwise suffer undue hardship.

(2) Circumstances that may cause a spouse or child to suffer undue hardship include the following:

(a) the spouse has responsibility for an unusually high level of debts reasonably incurred to support the spouses and their children prior to the separation or to earn a living;

(b) the spouse has unusually high expenses in relation to exercising access to a child;

(c) the spouse has a legal duty under a judgment, order or written separation agreement to support any person;

(d) the spouse has a legal duty to support a child, other than a child of the marriage, who is

(i) under the age of majority, or

(ii) the age of majority or over but is unable, by reason of illness, disability or other cause, to obtain the necessaries of life; and

(e) the spouse has a legal duty to support any person who is unable to obtain the necessaries of life due to an illness or disability.

[17] There are two reasons why the respondent says it is an undue hardship to pay child support based on his line 150 income. First, the respondent says that it is an undue hardship to order child support based on his full line 150 income because it includes a bonus that is not “guaranteed or predetermined”. Second, the respondent states that he has an obligation to support his mother. He sponsored his mother to come to Canada and has signed a sponsorship agreement to support her. He describes this obligation as paying her rent of $450 a month.

[18] It is the respondent’s burden to prove undue hardship. The circumstances in s.10 (2) are not exhaustive. He did not provide a copy of his sponsorship agreement. In any event, this agreement with the government to support his mother is not a “judgment, order or written separation agreement to support any person”. Since the list in s. 10 is not exhaustive, a sponsorship agreement might be considered and could depending on the facts support a finding of undue hardship. In this case it does not. All that we know is that the respondent pays his mother’s rent of $450 a month. He told the court that she does not live with him. Perhaps the financial burden that could be lessened if his mother did live with him. A great deal is not known about the so-called burden. For example, it is not known when he agreed to sponsor his mother, how long this obligation will last, whether his mother can work and earn some income, whether she has any assets and whether she has other children who can assist her with her rent.

[19] The respondent has had the benefit of a significant bonus in each of the last three years. He has not paid table child support and the applicant is left to carry the expenses of raising the child and paying the mortgage. The respondent has had ample opportunity to budget his expenses and plan for the fact that he often receives a bonus at the end of the year. The respondent’s financial statement is based on his receipt of a base salary alone. If as the respondent states his base salary is $46,514.16, this means that in 2013 he was paid a bonus of $32,003.84. He has not accounted for what he did with this money. He knew that he owed child support and yet did not set any of this money aside to fulfill his obligation. The respondent’s financial statement reveals that he has savings of $1760 and an RRSP worth almost $10,000.

[20] Proving undue hardship involves meeting a high standard. The hardship must be exceptional, excessive and disproportionate. (See Morrone v. Morrone, [2007] O.J. No. 5341.) On the facts provided, the respondent has not proven that the bonus or his sponsorship obligation should be accepted as a “circumstance that causes undue hardship”. I reject the respondent’s claim of undue hardship. On an interim basis, child support shall be based on the previous year’s line 150 income.

Child support

[21] This court has jurisdiction under in s. 15.1 of the Divorce Act to award retroactive child support when an interim child support order has not been made as in this case. D.B.S. v. S.R.G., 2006 SCC 37 at paras. 80 to 81, 92 (“D.B.S.”).

[22] In determining whether to make a retroactive award, D.B.S.at para. 133 directs that a court should consider four factors:

(1) Whether the recipient parent has supplied a reasonable excuse for any delay in seeking support;

(2) The conduct of the payor parent;

(3) The circumstances of the child; and

(4) Hardship occasioned by a retroactive award.

[23] In considering the question of retroactive support, a court must take a holistic view of the matter and decide each case based on its particular facts. None of the four factors is decisive: see D.B.S., at para 99.

[24] The retroactive period is small and the mother and child are in need of support. She moved promptly for support. A retroactive award for such a small period of time should not create a hardship for the respondent.

[25] For the months of August (as of the 15th) through December 2013, child support is owed. The 2012 line 150 income is $87,515. Table child support is $781 a month for one child. Allowing for a half month in August the respondent owes child support for 2013 in the amount of $3,514.50

[26] In 2014, the 2013 line 150 is $78,518. Child support is $713. Through June 2014 the respondent owes $4278.

[27] In total the respondent owes $7,792.50 for past child support.

[28] As of July 1 2014, he owes child support of $713 a month.

Spousal Support

[29] The applicant seeks interim spousal support and the respondent argues that none should be paid.

[30] Section 15.2(1) of the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.) authorizes the court to make an order to require a spouse to secure or pay such lump sum or periodic sums, "as the Court thinks reasonable for the support of the other spouse."

[31] The factors and objectives that govern an interim or final order for spousal support are set out in ss. 15.2(4) and 15.2(6) of the Divorce Act. These sections provide:

15.2 …

(4) In making an order under subsection (1) or an interim order under subsection (2), the court shall take into consideration the condition, means, needs and other circumstances of each spouse, including

(a) the length of time the spouses cohabited;

(b) the functions performed by each spouse during cohabitation; and

(c) any order, agreement or arrangement relating to support of either spouse.

(6) An order made under subsection (1) or an interim order under subsection (2) that provides for the support of a spouse should

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

(b) apportion between the 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 spouses arising from the breakdown of the marriage; and

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

[32] The parties have provided Spousal Support Advisory Guideline calculations (“SSAG”). The SSAG is a “useful tool” and non-binding (Fisher v. Fisher, 2008 ONCA 11, [2008] O.J. No. 38 (C.A.)). It does not usurp the discretion of the trial judge or the relevant considerations in the statutes and existing case law.

[33] In 2011, the applicant’s last full year of work before the accident she earned $36,064. The applicant offers SSAGs that use a salary of $30,000 and $36,000. The best evidence that I have available is that the applicant can earn a salary in the range of $36,000. This is the salary I will use when considering spousal support. All of the SSAGs use the respondent’s 2013 income of $78,518 and table child support of $713.

[34] The applicant’s SSAG provides a range of spousal support that is slightly different from the respondent’s. The ranges are as follows:

Applicant

Low - $171 Mid - $512 High - $823

Respondent

Low - $136 Mid - $486 High - $809

[35] The mid-point of each SSAG gives each party close to 50% of the net disposable income.

[36] The facts in this case justify an interim spousal support order. This is a 13 year marriage. While both parties work, the respondent has for the last three years earned significantly more than the applicant. Income evidence further back was not available.

[37] When the respondent earns a bonus as he did in last three years there is a significant income disparity. The applicant has been left to manage all of the household and family expenses on her salary alone. During the marriage they relied on the respondent’s salary. The breakdown of the marriage has created an obvious disadvantage.

[38] I find that the applicant is entitled to interim spousal support going forward. I fix spousal support at $500 a month and order the respondent to pay this effective June 1, 2014.

[39] Spousal support from August 15 through May 2014 totals $4,750. The applicant is entitled to this retroactive spousal support. The parties are in the process of either selling the matrimonial home or having the applicant buy out the respondent’s interest. The respondent has the option of satisfying the order to pay $4,750 with his equity in the matrimonial home or paying this amount to the applicant no later than December 1, 2014. This will give the parties sufficient time to make arrangements to deal with the matrimonial home.

conclusion

[40] I make the following orders:

(1) The respondent shall pay the applicant child support for the period August 15 through December 2013 in the amount of $3,514.50.

(2) The respondent shall pay the applicant child support for the period January 1, 2014 through June 30, 2014 in the amount of $4,278.

(3) Commencing July 1, 2014 the respondent shall pay the applicant child support of $713 a month.

(4) The respondent shall pay the applicant spousal support from August 15 through May 2014 in the amount of $4,750. The respondent has the option of satisfying the order to pay $4,750 with his equity in the matrimonial home or paying this amount to the applicant no later than December 1, 2014.

(5) The respondent shall pay the applicant spousal support fixed at $500 a month effective June 1, 2014 pending further order of this court.

(6) A Support Deduction order is issued.

(7) No later than June 1 of each year, the respondent shall provide the applicant with a copy of his income tax return and notice of assessment. Each year effective June 1, the respondent shall adjust child support if necessary according to the respondent's annual income as defined in the Guidelines.

(8) If the parties cannot agree on costs, they will exchange brief written submissions and deliver them to this court by June 16, 2014.

C. Horkins J.

Date: May 23, 2014