SUPERIOR COURT OF JUSTICE - ONTARIO

COURT FILE NO.: FS – 13 - 391223

DATE: 2014/06/06

RE: Linda Goodman v. Joel Goodman

BEFORE: Justice Moore

COUNSEL:
Daryl Gelgoot and Vanessa Amyot, for the Applicant
Leonardo Mongillo, for the Respondent

DATE HEARD: June 3, 2014

E N D O R S E M E N T

[1] The applicant seeks:

a) An order for temporary spousal support in the sum of $13,356 per month retroactive to September 2013, without prejudice to her right to seek support retroactive to the date of separation;

b) An order dispensing with the respondent’s consent to the sale of the matrimonial home located at 66 Glen Park Avenue, Toronto; and

c) An order requiring the respondent to maintain all expenses associated with the maintenance of the home pending its sale.

[2] The respondent seeks:

a) An order setting off any spousal support owed by the respondent against his contributions toward the maintenance of the matrimonial home; and

b) An order dismissing the applicant’s claim to sell the matrimonial home; or, in the alternative

c) An order providing that, if the home is sold, the applicant’s share of the net proceeds of sale pending the determination of the property issues in this case.

[3] The parties each seek orders requiring the other to deliver further and better financial and other disclosure and they seek costs of the motion, which each agree should be fixed in the sum of $6,000. The applicant requests that if she is ordered to pay such costs, she be permitted to pay them at the completion of the case.

[4] This is an interim determination that was argued upon dueling, conflicting affidavits without questioning and in a situation of high conflict and assertions credibility shortcomings in the evidence before the court.

Background

[5] The parties married in 1988 and lived together until 2005. In that first interval of their marriage, they had three sons. Joshua Ryan was born in 1989, Jordan Kyle was born in 1992 and Jordan Michael, born in 1996.

[6] The older two sons are in university and Jonah is completing his high school studies and intending to pursue university studies as well. At this point they live in the matrimonial home. One or more of them may seek to pursue studies and live away from home in the fall of this year but whether, when or at what cost funded by what available sources is not at all clear upon the evidence at this point.

[7] The applicant submits that she has been the primary caregiver to the children throughout, responsible for meeting their day to day needs while the respondent worked long hours and often travelled in connection with his businesses. For purposes of this motion, however, there is unanimity of opinion that the children are accomplished, high functioning young men with goals and aspirations that their parents encourage and have to date supported financially and otherwise.

[8] Whether they will be considered children of the marriage for child support purposes remains an open question for determination during the proceedings and/or at trial. The question arose here in the context of its potential for complicating the financial needs and ability of the parties to pay. Education and child support expenses have been paid to date by the respondent.

[9] The respondent is 67 years of age and employed in a senior position in a medical laboratory company. He holds a PhD in biochemistry. His employment earnings are $320,000 per year. He anticipates working for several more years but faces retirement perhaps within the next three years.

[10] He has had other business interests over the years. He attempted to open methadone treatment clinics to supplement his income and build equity and he believes that he holds a beneficial interest in a company that sells urine test strips to methadone clinics but that interest is disputed by his business associates. The value, if any, of these business interests may become apparent during the course of the litigation but does not now factor into a consideration of his income for spousal support purposes.

[11] In 2013, the respondent’s employment income was $326,813.68. From that income he submits that he realized a net after deductions at source income of about $200,000 and paid out household expenses of $66,000, school fees for his sons of about $34,000, utilities of $20,160, other expenses for his children of about $20,000 and debt carrying costs of $9,600. Although his financial situation has yet to be tested by cross questioning, he asserts that he is unable to make ends meet, let alone fund the applicant’s desired lifestyle.

[12] The applicant is 51 years old and a student in a veterinary program in the Cayman Islands. She was accepted there in an accelerated program after having completed correspondence courses in biochemistry and physics. The program lasts two and one half years followed by an additional year of clinical training in Canada or in the United States and a final exam to qualify her to practice veterinary medicine. Her admittance to practice in Canada may coincide in time approximately with the respondent’s retirement.

[13] The applicant has worked at various income earning endeavors over the years while also overseeing the family home. More recently but only for a short time, she opened and ran a dog walking business. By the time of trial, the full financial picture of her income and income earning potential may become clearer. At this point, she submits that she is without any income and in debt. She insists that she is in desperate need of spousal support.

[14] The parties arranged their financial affairs during the marriage such that they split their income, where possible, and to facilitate matters, the applicant became the owner on title of the matrimonial home. The respondent seeks an equitable interest in the home as family property for equalization purposes or through resulting trust or unjust enrichment with a constructive trust remedies.

[15] He submits that, prior to the marriage, he owned the land that the matrimonial home was eventually built on. He says that he funded the land and building costs without financial contribution from the applicant. He adds that he has paid all of the home maintenance and carrying costs throughout marriage. He also invested $200,000 into home renovations.

[16] The applicant does not address funding of home purchase, renovation and other home ownership and management expenses in her affidavit evidence but maintains that the home is her only substantial asset. She asserts that it has a value of about $1,500,000, less a debt registered against it of about $600,000.

[17] The home was damaged by flooding in 2013. From that event, the parties have received an insurance settlement for damaged chattels of $169,000, of which $ 69,000 remains in trust pending the determination of issues at trial and the parties have each received $50,000.

[18] The insurer has offered to resolve claims for damage to the structure of the home upon payment of $200,000. The respondent holds a cheque in that amount but the parties have not agreed upon how settlement funds should be disbursed. As such, the cheque remains un-cashed and may well now be stale dated.

[19] The parties agree that if the home is to be sold, better it be repaired first and the respondent states that the insurer will not maintain coverage on the property after September of this year if repair of the basement structural damage is not made by then.

[20] The parties separated in 2005. At that time, the respondent bought a house on Elm Ridge Drive that the applicant lived in. During this separation, the respondent paid child support on a voluntary basis until 2011. The children lived with each parent on a week-about basis until 2009 when they went to live primarily with the respondent.

[21] In 2011 the parties reconciled, undertook therapy and the applicant returned to live in the matrimonial home. The reconciliation faltered soon thereafter and the parties determined to live separate lives under the same roof in the home, a situation that endured, albeit not without stresses and strains within the family, until May of this year when the applicant enrolled in veterinary college and moved to the Cayman Islands.

[22] The applicant asks that the matrimonial home be repaired, listed and sold. She explains that the Elm Ridge Drive house was sold after the parties reconciled and the listing agent the parties used then is the same person who the applicant proposes to use to list the matrimonial home now. She adds that she has no personal relationship with that agent.

Interim Spousal Support

[23] There is considerable dispute over the lifestyle that the parties enjoyed before they separated on 2005 and again in 2012. Lifestyle is an important consideration to be factored into any interim support determination.

[24] As Backhouse J observed in Turk,[1] interim orders, by their nature, are holding orders. Common sense dictates that the depth of the inquiry at this state of the proceedings is quite different from that expected at trial.

[25] Backhouse J cited the provisions of the Divorce Act applicable to spousal support orders[2] and stated that:

On an application for interim spousal support, the divorce act requires that a judge consider all the factors listed under s. 15.2(4) and each of the objectives specified under s. 15.2(6). However, case law recognizes the difficulties in meeting these requirements on an application for interim spousal support. These authorities support the proposition that the parties’ respective means and needs should assume the greatest significance and that the other objectives and factors be taken into account only in so far as practicable. Because of the complexity in applying compensatory, non-compensatory and contractual principles in conjunction with both the objectives under s. 15.2(6) and the factors under s. 15.2(4), jurisprudence suggests that a complete analysis should be reserved for trial after there has been a full review of the evidence and after a determination has been reached with respect to property division.

[26] In this case, the applicant insists that she enjoyed an affluent lifestyle throughout the lengthy period of co-habitation in the marriage. She asserts that money was never an issue and she had unrestricted access to the joint bank account. She points to having shopped in high end stores and receiving lavish gifts from the respondent as factors supporting her wish for a substantial interim support award to keep her in the style that she was accustomed to.

[27] The respondent submits that he was indeed a man of means at one point but his finances suffered through the time of the marriage such that in 1992 he was forced to declare bankruptcy. The standard of living enjoyed thereafter will be the subject of close scrutiny upon a proper record at trial. The one constant enduring over the years seems to be that the respondent remained employed and earned a substantial income that allowed the family to enjoy comforts of living such as nannies to look after the children, private school educations for the children and a large family home in Toronto.

[28] This said, however, both parties assert inability to live the lifestyle before separation now. In the foreseeable future, however, the applicant intends to live in the Cayman Islands as a veterinary student. Her expenses are projected at this point with no actual expense experience, of the kind that will be before the trial judge, yet available.

[29] Her chosen lifestyle going forward may well not mirror any lifestyle she experienced during the time of the marriage. In part that reflects her choice to live in the Cayman Islands but in part it may well result from the fact that the needs and means of the parties will not support the lifestyle choices each member of the family may wish to make between now and the time of trial.

[30] For purposes of interim spousal support I attribute an income of $320,000 per annum to the respondent and zero income to the applicant. The respondent is content to have the three children live with him and to incur special expenses for the children of $2,833 per month. I choose to apply the mid-range of the support guidelines, having taken all of the factors into account and order the respondent to pay interim spousal support to the applicant of $3,658 per month retroactive to the date of the applicant’s motion for interim support, May 2, 2014, without prejudice to the applicant’s claim at trial for support retroactive to the date of separation.

Sale of the Home

[31] As noted above, the applicant seeks to repair, list and sell the home immediately. The respondent is not opposed to a future sale of the home but insists that the home currently provides security and stability for the children. The youngest child will become an adult in November of this year; the older two are in their twenties now. Upon the evidence currently available, whether or for how long these young men will continue to live in the matrimonial home is speculative at best.

[32] The applicant submits that the respondent has offered no reasonable support for his position. The parties agree that section 23 of the Family Law Act allows the court to order that the home be sold without the consent of a party where that party is unreasonably withholding his consent to the sale. The operative provision is found in section 23(b)(iii) of the Act.

[33] The applicant relies on ample, relevant and persuasive authorities in support of her position.[3] While there are issues as to the parties’ respective entitlements to the net proceeds of any sale of the property to be determined at trial, I am not satisfied that the interim housing needs of the respondent and his sons can be accommodated with his remaining, still substantial, income after satisfaction of his interim spousal support obligations. The evidence does not support a realistic need to maintain the house as a home for the benefit or stability of the children.

[34] In this latter respect, Greer J cited and relied upon the reasoning of Benotto J, in Cox.[4] Greer J stated:

As Madam Justice Benotto stated….I have no evidence as to why this particular house is necessary for the children's best interests. They are healthy and well-adjusted…[5]

[35] The respondent has not established a reasonable need to delay the repair and sale of the home. Delaying the sale until the time of trial simply adds time to the process of translating the asset into a fund to be allocated between the parties according to their interests on proper evidence at trial. I am satisfied that the house should be sold and the proceeds of the sale should be maintained in trust pending agreement between the parties as to allocation between the parties or further order of the court.

[36] The parties shall have thirty days to agree upon a process for the repair of the property and its funding through available insurance proceeds; absent such agreement the applicant shall be given the right to deal with the insurer and mortgage holder as to repairing the home and with the agent of her choice to list the home following its repair. A sale on the open market for the best possible price will bring closure to the question of net value of the property and serve the best financial interests of both parties.

[37] If an acceptable offer to purchase the property is received, the applicant shall offer the respondent the opportunity to sign as a spouse on the acceptance of the offer. If the Respondent refuses to sign the offer before it expires, the applicant is authorized hereby to proceed with the sale without the respondent’s consent.

[38] The respondent shall pay all expenses associated with the maintenance of the property until closing of the sale, offer vacant possession for purposes of the sale prior to closing and co-operate with the repair, listing and showing processes, in order that the best outcome for each party might be achieved.

Disclosure Issues

[39] The parties are each seeking further financial and other disclosure. There has been progress made recently but they seek orders to ensure that best efforts are made on both sides to complete the evidentiary record for trial purposes.

[40] An order shall therefore issue requiring each party to provide the other, within 30 days, with a demand for production of any specific documents or types of documents known or thought to exist that are relevant and not privileged. Each party will respond to the request received within 30 days thereafter. In the interim, each party shall also endeavor to comply with the rules respecting financial disclosure and document production.

[41] Should disclosure issues remain after 60 days, the parties shall schedule a case conference to seek further directions from the court on marshalling relevant and admissible evidence for trial in advance of any motion on disclosure issues.

Education Expenses

[42] The parties anticipate that all three of their children wish to and will apply to attend universities in the fall of this year and in the future. They disagree upon what reasonable expenditure each child should incur in that regard and on where they will live. These questions cannot be answered on the evidence before me. At this point, it appears unlikely that the applicant will be financially able within the near future to contribute to education related expenses for the children.

Costs

[43] For the first time, during submissions on the motions, the respondent acknowledged a willingness to contribute toward interim spousal support. The motion for such support was necessary therefore but could have been averted, had he reached this epiphany sooner. Although the applicant fell short of her requested level of interim support, she obtained an order both for support and for the repair and sale of the home. Accordingly, costs are awarded to the applicant, fixed in the sum of $6000 and payable forthwith.

Moore J.

DATE: June 6, 2014

[1] Turk v. Turk, 2008 3420 (ON SC), [2008] O.J. No. 397, at para 36

[2] Sections 15.2(4) and 15.4(6)

[3] Lo v. Mang, [2009] O.J. No. 4531 (S.C.J.) and Lee-Broomes v. Broomes, [2012] O.J. No. 1774 (S.C.J.)

[4] Cox v. Adibfar, [2000] O.J. No. 2238 at para 9.

[5] Ibid, at para 15