COURT FILE NO.: FS-12-76142

DATE: 2014016

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Marsha Olivia Elizabeth Graham, Applicant

AND:

Mark Anthony Graham, Respondent

BEFORE: Lemon, J.

COUNSEL: Mahzulfah S. Uppal, for the Applicant

Mr. Graham on his own behalf

HEARD: December 11 and 13, 2013

ENDORSEMENT

The Issue

[1] Ms. Graham seeks an order for child support based on an imputed income to Mr. Graham. In return, he seeks an order for supervised access to the children of the marriage.

[2] The parties married December 23, 2003, and separated, while living under the same roof, in January of 2012.

[3] They have two children, born September 20, 2005 and February 26, 2007.

[4] On August 26, 2012, Mr. Graham was charged with assault and a variety of other charges relating to Ms. Graham. Since that time, he has been out of the matrimonial home, and under bail terms that he not be in contact with Ms. Graham.

[5] This action was commenced in October of 2012.

[6] The matrimonial home was sold November 9, 2012, with a net result that is not entirely clear on the materials. It appears, however, that there is a balance of $26,027.29 remaining in trust at the present time. On an interim basis, Ms. Graham seeks those funds for child support and s. 7 expenses.

[7] Ms. Graham is employed as an elementary school teacher, and earns approximately $88,000.00 per year.

[8] Mr. Graham carried on business as a concert promoter but has been unemployed since 2010 when he describes that the business failed.

Income

[9] Ms. Graham seeks an order for child support based on an imputed income to Mr. Graham of between $92,000.00 and $150,000.00 per year. Mr. Graham denies that he has any income.

[10] The parties purchased the matrimonial home in 2006. At that time, they entered into a mortgage in the amount of approximately $639,000.00. Ms. Graham earned approximately $70,000.00 that year.

[11] It is Mr. Graham’s position that in that year, he earned $6,827.00. Despite that, however, he acknowledges that he provided the mortgage company with a letter from his employer stating that he earned $92,144.00. In fact, at the time, that employer no longer employed him. He confirms that he also provided a fraudulent T4 statement. He did this again when the mortgage came up for renewal in 2010. He refers to this as an “error in judgment.”

[12] Ms. Graham submits that Mr. Graham earns far more than he sets out in his materials. She points to the fact that he has expensive jewellery, undocumented but alleged debts and incomplete records for his promotion business. She notes that while the parties were together, they were able to maintain their mortgage payments along with approximately $1,600.00 per month for the children’s Montessori school. She has produced records that seem to indicate that Mr. Graham had purchased expensive jewellery and received cash payments in excess of $100,000.00.

[13] In response, Mr. Graham has provided substantial documentation setting out the debts that he incurred operating the business. He acknowledges some of the jewellery, but says that the values were over-inflated, and that his clients gave much to him as gifts. He says that the business was operated from funds given to him by investors and points in particular to one individual who invested funds. That individual, however, in her supporting affidavit, says that she has “loaned” as much as $32,500.00 for Mr. Graham’s consumer and household expenses since 2009. In short, she denies that she is an investor, but rather a lender.

[14] Mr. Graham has provided his personal Notices of Assessment for the years 2003 through to 2010. They show that he reported that he earned a high of $15,040.00 in 2004 to a low of $2,000.00 in 2007. Although substantial supporting records were provided, none related to the income for Mr. Graham or his company.

[15] Just at the end of argument, Mr. Graham provided the income tax returns for his promotion company, YOTE Inc. for the years 2009, 2010 and 2011. Those records show that the company lost $175,686.00 in 2007; and $668,764.00 in 2010. In both 2010 and 2011, the business records indicate sales of the same coincidental value of $32,340.00. No supporting documentation or schedules were attached; no other income tax returns were provided.

[16] Mr. Graham deposes that individuals invested money for each of his promotions to fund the business. There is no record of anyone providing funds or credit to the business. There is no explanation of where the funds came from that would allow losses of such a magnitude.

[17] Mr. Graham says that he received a GST refund of $13,933.00 in 2011. Accordingly, in 2010 or 2011, his business must have purchased items that incurred $13,933.40 of GST. Those purchases would require funds coming into YOTE Inc. in order to purchase them. There are no records of such infusions of capital.

[18] In any event, Mr. Graham acknowledges that since the failure of his business in 2010, he has done nothing to earn an income to support his children. Despite receiving funds from the proceeds of sale of the matrimonial home and from his friends and investors, he has paid nothing to support his children other than a total of $25,000 ordered to be paid from the proceeds of sale on November 1, 2012 and June 24, 2013.

Analysis

[19] There is no doubt that Mr. Graham has lied in the past. The question here is whether he is lying now or, at least, providing evidence upon which I can rely. Given the documents that confirm that he has a substantial income, I do not accept that he has made nothing since 2010. I do not accept that he cannot earn an income. Since he has failed to provide anything that supports his proposed income, I draw the adverse inference that he is attempting to hide his income and is intentionally underemployed.

[20] Given the amount in trust, I need not make a close calculation of the Child Support Guidelines or the s. 7 expenses. Even based on an income of $92,144.00, the child support would be $1,320.00 per month. Given the children’s needs, Mr. Graham’s ability to earn an income and the likely time to trial, the funds in trust will be depleted by the time of trial.

[21] The s. 7 expenses as claimed are necessary and reasonable given the children’s needs. Before and after separation, the father agreed with the dance and piano expenses and participated in the children’s activities as claimed. The additional driving expense was caused by Mr. Graham and necessitated the expense for the benefit of the children. On the material before me, it appears that Mr. Graham’s share of the s. 7 expenses ranges between $1,318.00 and $2,012.00 per month.

[22] Accordingly, the funds in trust shall be transferred to Ms. Graham on account of child support and extraordinary expenses as claimed by Ms. Graham. She shall use the fund only for those purposes.

[23] This order will be without prejudice to the trial judge in determining the appropriate amount of support based on the evidence at trial. If Mr. Graham has evidence that will confirm the income side of his business, then, perhaps, his position will be verified. For now, the evidence shows that Mr. Graham has been able to support the children and can continue to do so on an interim basis.

[24] If the funds are depleted prior to trial, Ms. Graham may bring a further motion for child support and s. 7 expenses. Without making it a term of an order, I would recommend to Ms. Graham that she budget according to the calculations set out above.

[25] Mr. Graham sought an order for payment of some of the funds in trust to be made to him. He also sought an order to have an income of $21,320.00 imputed to him. For the reasons set out above, those motions are dismissed.

Access

[26] On November 1, 2012, Murray J. ordered, on consent, that Mr. Graham would have access to the children on Saturdays from 9:30 a.m. until 7 p.m., and Sundays from 10 a.m. to 5 p.m., along with Christmas access in 2012.

[27] However, Mr. Graham states that allegations have been made against him by Ms. Graham with respect to threats or breaching his bail conditions during access visits. He has used his parents to assist with the pick-up and drop-off, but even they are concerned about allegations made against them. As a result of the allegations, Mr. Graham says he has not had access since February 2013.

[28] He therefore sought an order requiring access to be supervised.

[29] During submissions, the parties agreed that a consent order could follow allowing Mr. Graham to have his access supervised by a professional third party of his choice in accordance with the present order. The cost of that supervisor shall be paid by Mr. Graham.

Consent orders

[30] Mr. Graham agrees that Ms. Graham may renew the present passport for the children, and his consent is thereby dispensed with for that renewal.

[31] Mr. Graham waives any need to approve the order as issued and entered.

Costs

[32] If the parties cannot otherwise agree on costs, written submissions may be made. Ms. Graham shall make her written submissions within the next 30 days and Mr. Graham shall reply within 30 days thereafter. Both submissions shall be no more than three pages, not including any bills of costs or offers to settle.

Lemon, J.

Date: January 16, 2014