CITATION: Gayle Rzadki v. Peter Rzadki, 2015 ONSC 1166

COURT FILE NO.: FS-10-357734

DATE: 20150223

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

GAYLE RZADKI

Applicant

– and –

PETER RZADKI

Respondent

Jan D. Weir, for the Applicant

Susan Adam Metzler, for the Respondent

HEARD: January 27, 28, 29, 2015

CHIAPPETTA J.

Overview

1The issues to be addressed between the parties were ample. The evidence presented to support the resolution of the issues, however, was limited. The Court found itself in the unenviable position of dismissing the relief sought by each party against the other for failing to discharge the respective onus upon it. The Applicant’s request for child support for Kathryn, however, is addressed by exception. While the evidence was neither full nor robust, the relief is not dismissed outright. Rather a formula is ordered to direct disclosure and apportion Kathryn’s post-secondary educational costs.

Background

1. The Litigation

2The Applicant wife, Gayle Rzadki, and the Respondent husband, Peter Rzadki, were married on May 27, 1989. They separated in March 2005. They reconciled that same year. They separated a second time on March 1, 2010. Until April 19, 2011, Peter Rzadki continued to live in the matrimonial home located at 12 Baby Point Road in Toronto (“the matrimonial home”). The sale of the matrimonial home closed on August 24, 2011.

3Gayle Rzadki commenced the within application on March 24, 2010. Contested litigation was suspended between September 2011 and May 2013 as the parties made various attempts at reconciliation.

2. The Parties

4Gayle and Peter Rzadki were the only people who testified at the trial of this matter.

a) The Applicant

5Gayle Rzadki was born on September 1, 1965. She worked as an office manager for a major medical clinic until after the birth of the parties’ second child in 1994. The Applicant testified that after the birth of the parties’ second of three children, her and the Respondent made a decision for her to stay home and care for the children. She nonetheless worked at various ventures until the birth of her third child; she ran a small business venture providing electronic billing services for physicians, she opened a children’s clothing business and she worked as a supply teacher.

6In approximately 2004, the Applicant began working for a friend’s promotional company in sales. In 2007, she started her own promotional company called Promotional One. The Applicant’s gross income, without adjustments for expenses, was $15,165 in 2008, $9,777 in 2009, and $10,464 in 2010. She suffered losses in 2011 and 2012 in the amounts of $4,222 and $10, 698, respectively. In 2013, the last year that the business was operating, the Applicant’s net income, not including home office expenses, was $16, 267.

7The Applicant testified that since separation in March 2010, she looked for employment and in doing so learned that her professional skills are stale. In her opinion she requires a two year college course at approximately $7,000/year before she is employable. Her evidence is that she is presently without funds to go to school; she is presently without funds to even pay her rent. The Applicant testified that her landlord is allowing her to remain in her rental home without paying rent until the spring of this year when the house will be demolished. She has paid over $140,000 in legal fees to date. Her evidence is that she used her credit cards up to their maximum limit, borrowed approximately $100,000 from her parents and over $40,000 from her aunt. She testified that she has since paid these debts with the proceeds from the sale of her interest in the recreational property, as described below.

8The Applicant’s narrative is that the Respondent’s conduct throughout these proceedings reflects his deliberate retaliation against her attempts to dissolve the marriage and escape the control of the Respondent. The Applicant testified that the Respondent told her many times that if she ever left him he would quit his job, not pay child or spousal support, that she would end up with nothing and that she and the children would find themselves living at Jane and Finch.

b) The Respondent

9The Respondent denies that he made these statements. The Respondent’s narrative is that the Applicant always lived beyond their financial means. She kept her finances secret and refused to communicate or cooperate with him on family budgeting and financial planning. He testified that he was not aware of the Applicant’s business income until he received her financial disclosure as part of the within proceeding. She always represented that she was earning approximately $40,000. During this time, he was contributing virtually all of his income to the joint chequing account for family expenses. He was managing the mortgages on the matrimonial home and the recreational property from his personal accounts to which he contributed his investment income. The Respondent continued to contribute to the joint account post separation, without a support order in place. His evidence is that he is not able at this time to provide ongoing child support.

10Peter Rzadki was born on October 11, 1960. He is presently not employed. Until March 2012, the Respondent had a permanent position as an Assistant Deputy Minister with the Provincial Government earning $160,000.00 per annum, with potential bonuses and benefits. The Respondent testified that in March 2012, he took a brief break “to re-focus and re-network his career”. In November 2012, he took a position as Director, Farm Products Marketing Commission, with an annual salary of $131,000.00, with benefits. In February 2013, he was asked not to return to this employment.

11The Respondent testified that he began to feel ill in 2013. He sought the care of first of an employee assistance program and then a psychiatrist that he continues to see today. The Respondent’s psychiatrist did not testify and no report or clinical note from the psychiatrist was filed with the court. There is no evidence even of the name of the psychiatrist. The Respondent testified that he is suffering from a major depressive and anxiety disorder and that his psychiatrist originally felt that his condition would dissipate within four months. It did not. The Respondent further testified to the opinion of his psychiatrist, which he describes as presently unable to return to work, even in an accommodated position. The Respondent’s hearsay evidence is that his psychiatrist cautioned him against his continued efforts to network and “remain on the radar” for when he is able to return to work.

12The Respondent testified that he claimed and received short-term disability benefits from Great West Life Insurance Company (“GWL”) from June to December 2013. He applied thereafter for long term disability benefits. GWL denied this claim. The Respondent advises the Court that he is pursuing legal recourse to have GWL accept his claim for long-term disability benefits.

13In 2014, the Respondent earned no income. He generated income related to cashing in vacation days that accrued primarily after the date of separation and gave one half of the gross amount to the Applicant. He received a bonus for 2013 and gave one half of the net amount to

the Applicant. And he received Employment Insurance payments, out of which he testified that he paid a debt on the recreational property (referred to below) and some of his own living expenses. The Respondent’s evidence is that he and the Applicant had several discussions about their plan for the Applicant to return to full time employment when their youngest child started middle school. He states that the Applicant always kept her finances secret and led him to believe that she was earning over $40,000 per annum in each of 2008 and 2009.

14The Respondent’s line 150 income in prior years has been: $176,556 in 2009, $175,918 in 2010, $183,434 in 2011, $176,858 in 2012, $163,819 in 2013, and $54,255 in 2014. The Respondent’s financial statement sworn January 14, 2015 lists his total amount of yearly expenses as $77,708.40. The amount of income to be imputed to the Respondent for child support from January 1, 2015 forward as claimed for Michael and Kathryn is an issue in this trial.

15In June 2013, the Respondent leased a three bedroom furnished condominium for himself. He testified that his expenses are no longer manageable and that he plans to move into a smaller unit. He presently owes over $400,000 to his parents secured with an increasing lien on the recreational property. The loan includes the amount his parents lent him to purchase the Applicant’s interest in the recreational property, approximately $100,000 borrowed to date for living and legal expenses, and rent owing to his parents for staying with them during the 2005 separation and again between April 2011 and November 2012.

c) The Children

16There are three children of the marriage. There is no issue with respect to custody and access.

17Cameron Rzadki was born on April 6, 1992. Cameron is currently in the first year of an MBA program at Western University in London, Ontario. There is no claim for child support for Cameron.

18Kathryn Rzadki was born on February 1, 1994. Kathryn is currently in her third year of studies at Queen’s University in Kingston, Ontario. The Applicant seeks child support from the Respondent for Kathryn.

19Michael Rzadki was born on July 2, 1997. Michael is currently in Grade 12 at Bishop Allen Academy in Toronto, Ontario. The Applicant seeks child support from the Respondent for Michael.

20Michael lives with the Applicant. Kathryn lives with the Applicant in the summer months and visits her approximately six times during the academic year.

21Cameron has not lived with either parent since September 2012.

22The Respondent describes his relationship with his children as “neutral to good”. He spent some rewarding time this past Christmas with Cameron and is open with all of his children about his health condition. He notes that Michael is a little more distant, having last seen him one on one in October or November 2014.

3. The Finances

23The parties had no significant savings at the time of separation in March 2010. They borrowed $100,000 in 2009 and used it in full by 2010. They continued to co-mingle their finances long after separation.

24The parties maintained a joint chequing account until the end of 2013. Gayle Rzadki accepts however that she was the only one using the account between July and December 2013, when the account was finally closed. Liability for the overdraft amount of the joint chequing account is an issue in this trial.

25Virtually all of the Respondent’s income was deposited into the joint chequing account. The joint chequing account was accessed regularly by the parties to fund living expenses and the children’s expenses, including funding an RESP for Kathryn and to paying some of the Applicant’s CIBC Visa charges.

26The Applicant’s CIBC Visa card was originally to be used strictly by the Applicant for expenses associated with her business, Promotional One. The Respondent, however, had a secondary card that he used until April 2011, when the Applicant took it away from him. A review of the few CIBC statements relied upon by the parties as evidence further to other issues demonstrates that the Applicant used the CIBC Visa card at least in part for family expenses.

4. The Properties

27The sale of the matrimonial home closed on August 24, 2011. The property sold for $1,049,622.18. The parties were highly leveraged at the time of sale. The remaining funds were deposited in the parties’ joint bank account.

28Upon the sale of the matrimonial home, the parties entered into a lease to rent a house at 41 Leland Ave, Toronto, Ontario (“Leland”). The Respondent testified that he borrowed the funds ($5,100) from his parents in order to pay first and last month’s rent on the property. He further testified that he lived at Leland with his family until May 2013, when he states the Applicant locked him out of Leland. The Respondent admits that he never had a key to Leland and that he slept on a couch in the basement. The Applicant denies that the Respondent was living at Leland; rather, she states that he stayed over a few nights at Christmas and lived between the farm and his parents. Her evidence is that the Respondent signed the lease as the Applicant was without a sufficient credit profile to do so on her own

29The Respondent’s evidence on this issue is inconsistent and I do not accept it. The Respondent testified that part of the increasing loan to his parents includes rent he owes them for staying with them between April 2011 and November 2012. It makes no sense, however, that the Respondent would be indebted to his parents for rent for the same period of time that he testified he was living at Leland. The only reasonable conclusion is that, as testified to by the Applicant, he was not living at Leland. Rather, he was living with his parents and visiting Leland as a guest in the Applicant’s home and staying over by exception.

30The parties jointly purchased a recreational property in 2007 (“the farm”). The Respondent eventually purchased the Applicant’s interest in the farm pursuant to an Agreement of Purchase and Sale entered into on September 22, 2014. The transaction closed in October 2014. The Respondent testified that he borrowed funds from his parents in order to be able to pay the Applicant’s share of the equity in the farm. The Applicant received $260,000. Her evidence is that from those proceeds she paid her parents $100,000 and her aunt $40,000 to satisfy their respective loans to her; she paid her $50,000 credit card debt and lent Cameron $17,000 to pay his grandfather back a $10,000 loan and to contribute the remaining amounts to his educational expenses. The remaining $33,000 she testified went to living expenses, such as past due hydro bills.

31Payment of the expenses for the farm prior to the transaction is an issue in this trial.

5. Evidence

32The Applicant and the Respondent were the only two parties to testify at the trial of this matter. At times, as described above, their respective historical accounts of the facts are inconsistent. The Applicant submits that any inconsistencies should be resolved in her favour. Her primary reasons for this include that the Respondent was convicted in 2005 for assaulting her, put a tracking device on her vehicle without her consent in 2010, shortly after separation, and was charged with impaired driving in 2011 and convicted of this charge in 2013. The Respondent has admitted to these actions and consequences. In my view they are not determinative of credibility. Rather, credibility is to be determined on an issue-by-issue basis considering the context and circumstances relevant to the particular factual analysis.

33Both parties have raised post separation accounting issues seeking payment from each other as a result. Both parties prepared calculation charts designed to demonstrate the amounts owing from the other. Both parties testified that their respective charts are sourced from their respective review of all the relevant bank statements wherein they state they respectively traced all sources of income and all payments made. Each party attacks the charts of the other citing errors. None of the supporting documentation was filed with the Court; only the parties’ respective calculations.

34In my view, both of the parties’ charts suffer the same fate. There is good reason to doubt the accounting therein. For example, the Applicant admits that in her calculations she failed to account for and credit all of the Respondent’s deposits into the joint chequing account or items for which the children reimbursed her. Similarly, the Respondent admits that in his calculations, he failed to account for his own personal use, including his own legal expenses, and he failed to separate the CIBC visa charges and payments thereto by family and business. Each of the parties’ calculations lack forensic accuracy, include demonstrated and admitted errors, are without supporting documentation, and are subject to self-promotion. They are not reliable.

35The parties’ evidence, including the Applicant’s reply evidence was completed on the second day of trial. The trial was adjourned to the third day for closing arguments. At the commencement of the third day of trial, instead of proceeding with closing arguments, the Applicant requested leave of the Court to re-open her case and call evidence related directly to the post-secondary education needs and means of Kathryn. The Respondent opposed the request. I allowed the Applicant to re-open her case for this purpose strictly because it related to the issue of Kathryn’s ongoing child support. Both the Applicant and the Respondent gave evidence on the issue and were cross-examined. As set out below, however, the Court would have preferred a more robust approach to this evidence.

6. Agreement by the Parties

36Prior to the completion of the trial, the parties agreed to the amount owing to the Applicant in accordance with the equalization of net family property. More specifically, it is agreed that the Respondent will transfer from his pension $394,696.00 to the Applicant in full satisfaction of the equalization of net family property.

37Further, by agreement, the parties ask the Court to grant them a divorce. I am satisfied that the details of the marriage were proven by the Certificate of Marriage dated May 27, 1989 and filed as Exhibit 2. There was a breakdown of the marriage. The parties have lived separate and apart for at least one year and there is no chance of reconciliation: Sections 3 (1), 8(1), 8(2), 8(3) of the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.).

38The parties advised the Court that the following claims were abandoned and need not be addressed or resolved by the Court:

1. Applicant’s claim for outstanding items pertaining to an Order of Justice Czutrin dated May 26, 2011;

2. Respondent’s claim for a transfer of points on the Applicant’s credit card to the Respondent;

3. Applicant’s claim for ongoing spousal support;

4. Chattels.

Issues

The remaining issues between the parties are:

(a) Whether the Applicant owes the Respondent anything for post separation adjustments;

(b) Whether the Respondent owes the Applicant anything for post separation adjustments;

(c) Calculation of child support from January 1, 2015 onward, if any, for Michael and Kathryn.

Analysis

(a) Whether the Applicant owes the Respondent anything for post separation adjustments

39The Respondent submits that the Applicant owes him the following amounts:

(i) $14,635.00 for the Applicant’s use of the joint line of credit for personal expenditure;

(ii) $33,928.00 for his share of the net proceeds from the sale of the matrimonial home;

(iii) $18,650.00 for her equal share of the carrying costs for the matrimonial home and the farm; and

(iii) $13,490.00 for her equal share of expenses related to the farm.

40The Respondent’s position is that the Applicant owes him $80,703.00. The Respondent submits that this amount should be reduced by approximately 20 percent to $60,000.00, because of what he describes as “all of the complexities and intricacies and difficulty in tracing all that would need to be traced for forensic accuracy”. In my view, however, the Respondent’s entitlement to post separation adjustments is limited to those amounts that he can prove, on a balance of probabilities, are properly due and owing to him, not those amounts that he believes may be owing, subject to a reduction for the errors he admits are inherent in his calculations.

(i) The joint line of credit

41The parties’ joint line of credit was paid in full upon the closing of the matrimonial home in August 2011. The Respondent argues that the Applicant owed $29,270 more in post separation debt against this account than the Respondent. The Respondent considers six transactions from this account between March 1 and July 5, 2010:

1. March 18 – $9,358.50 for the Applicant’s car;

2. March 18 – $2,500.00 for the Applicant’s lawyer;

3. March 18 – $2,500.00 cash withdrawal by the Applicant;

4. April 16 – $10,761.26 paid to the Applicant’s CIBC Visa: $5,057.00 as part of the Applicant’s vehicle purchase and $6,369.96 of travel expenses charged by Cameron and his friends for which the Applicant was reimbursed;

5. April 26 – $14,000.00 paid to replace the barn roof of the farm property;

6. July 5 – $13,500.00 transferred by the Respondent to his account, which he states he used in its entirety for family expenses.

42The Respondent argues that, treating the $14,000.00 and $13,500.00 as joint and equal responsibilities, the Applicant is solely responsible for $25,119.76 ($9,358.50; $2,500.00; $2,500.00; and $10,761.26). He submits that he paid one half of the Applicant’s debt to the joint line of credit when it was paid in full from the proceeds of the sale of the matrimonial home. Further, the Respondent submits that he paid the interest charges on the joint line of credit primarily from his personal account. The Applicant, it is argued, is therefore responsible for $2,075.12 in interest payments, for a total amount owing to the Respondent of $14,635.00.

43In my view, the Respondent has not met the onus upon him to satisfy the Court that these amounts are properly due and owing to him. Rather, he provided the Court with only a chart listing the transactions on the joint line of credit from April 26, 2010 to July 2011, pointed to the above noted transactions and concluded verbally that therefore the Applicant used more of the joint line of credit than he did. For reasons noted above, the chart is entirely unreliable. I am unable to conclude from the chart that the Applicant had more debt against this account. Such conclusion requires a more rigorous analysis of all of the expenditures of the account or, at the very least, a review of all of the source documents. This evidence is not before the Court.

(ii) Net proceeds from the sale of the matrimonial home

44The Respondent argues that when the parties’ joint debts were paid from the net proceeds of the matrimonial home, the remainder was $84,165.00. This amount was deposited into the joint chequing account. He submits that each party was entitled to $42,083.00. It is argued that he used only $8,152.00 of his share to pay a credit card debt, such that the remainder of the $33,938.00 should be paid back to him by the Applicant.

45I disagree. The remainder of the net proceeds was deposited into the parties’ joint chequing account. The evidence is that that account was accessed by the Applicant to pay for living expenses for her and the parties’ three children. At that time Michael and Kathryn lived with the Applicant at Leland. Cameron was away at school shortly after the sale of the matrimonial home but nonetheless looked to his mother for routine living expenses. There is no evidence that the Applicant used the net proceeds for personal desires. Rather, the Applicant continued to access the joint account to sustain herself and the children. The Respondent took no steps to withdraw any portion of the net proceeds from the joint account. Rather he left the funds in place knowing that they were being accessed by the Applicant in the normal course. The Respondent advises the Court today that he continued to financially support his family post separation without a court order requiring him to do so. He had a legal obligation to support his children however. There is no claim for retroactive child support. The Respondent’s request that any residual proceeds now be paid to him by the Applicant is denied.

46Further, the Respondent has failed to satisfy the onus upon him to demonstrate that he used only $8,152.00. Again, other than the Respondent’s asserted conclusion, the only evidence offered in this regard are the unreliable charts prepared by the Respondent listing his view of the deposits in and withdrawals from the joint chequing account from March 2010 to December 2013.

(iii) The carrying costs for the matrimonial home and the farm

47The Respondent testified that he paid $37,288.00 for mortgage payments and interest charges related to the matrimonial home and the farm. He seeks $18,650.00 for what he submits is the Applicant’s equal share of the mortgage and interest costs for the matrimonial home and the farm. The Respondent admits that some of these costs were covered by the $13,500.00 he transferred to himself from the joint line of credit, as referred to above, but testifies that he had to cash in his TD Waterhouse account to absorb the rest, at a value of $24,090.00.

48The evidence is that at the time of separation, the Respondent was solely contributing to the mortgage and interest payments of the matrimonial home and the farm. It does not follow as a matter of course that he is not entitled to post separation adjustments for the jointly owned property. I find that in the circumstances of this case, however, no adjustment is warranted. The parties continued the pattern of responsibility for payment of such expenses for almost 5 years after separation. The Court ought not undo something today that the parties’ aquienced, particularly in light of the deficient evidence of such expenses.

49The Respondent further argues that the $24,090.00 investment is included as a date of separation asset for the Respondent. The Respondent therefore submits that the Applicant should not benefit twice , as the Respondent had to use this asset for real property expenses for which the parties were equally responsible.

50I am not satisfied, however, that the amounts were actually applied to the real property expenses. The Respondent has not satisfied his onus in this regard. There are no documents from TD Waterhouse demonstrating that the account was liquidated and no bank documents demonstrating that it was applied to the respective costs. No mortgage statements were filed with the Court nor did the Respondent submit his personal banking records demonstrating that he paid $37,288.00 for these expenses. The only evidence provided to support the Respondent’s statement is a chart which, for reasons set out above, is not reliable.

(iv) Expenses related to the farm

51The Respondent seeks $13,490.00 from the Applicant for her share of costs related to the farm, including taxes, utilities, repairs, snow removal, planting and maintenance. He submits that while some of the payments were made out of the joint account, most were made out of his personal account or by his personal credit card which he paid from his personal account. The Respondent submits that he paid $26,980.00 more than what is attributed or credited to the Applicant, so the amount claimed in reimbursement is $13,490.00.

52Again, I see no reason why these costs should be paid by both parties as joint owners. The evidence indicates that the parties’ conduct and practice of the Respondent paying these expenses prior to separation continued thereafter for a number of years. It can be inferred therefore that the parties were content with the status quo.

53Further, I am not satisfied that the Respondent has met the onus upon him to prove on a balance of probabilities that these charges were paid by him at this amount. The Court received no evidence on this issue beyond the Respondent’s statements and the unreliable calculation charts. Many third party charges are alleged, yet, no invoices were produced for items claimed such as snow removal or repairs or even planting. The Court has no bank statements showing that these charges were paid from the Respondent’s personal account or charged to his personal credit card. The Court is therefore left with no choice but to deny the relief claimed for lack of evidence.

(b) Whether the Respondent owes the Applicant anything for post separation adjustments

54The Applicant submits that the Respondent owes her the following amounts:

(i) $4,277.00 for medical expenses;

(ii) $582.94 for overdraft expenses;

(iii) $14,130.00 for farm expenses; and

(iv) $9,408.30 for charges to her CIBC Visa.

55The Applicant’s relief as requested suffers the same fate as that of the Respondent’s; the evidence offered to substantiate the relief is not sufficient for the Applicant to discharge the onus on her to prove on a balance of probabilities that the amounts are properly due and owing.

(i) Medical Expenses

56The Applicant testified that she paid for insured medical expenses on her credit card in June and December 2012 and February 2013, but the Respondent received and cashed the reimbursement cheques for these charges from his employer’s insurer. She states that the Respondent told her that he would not give her the reimbursement cheques anymore as she was already paid enough. The Respondent denies he made this statement and testified that he did not receive the reimbursement cheques from the insurer. The Applicant admits that she did receive at least one reimbursement cheque in the Respondent’s name and cashed it.

57In my view, the factual conflict in evidence in these circumstances need not be resolved. There is no evidence before the Court that the expenses were actually reimbursed by GWL. Rather, the Court was provided only with copies of three healthcare expense statements seeking reimbursement from GWL. There is no further record from GWL in terms of whether these specific expenses were indeed refunded. To this end, the Applicant has failed to meet her onus to establish that the expenses as submitted were refunded to the Respondent.

(ii) Overdraft Expenses

58The Applicant submits that the Respondent should pay one half of the overdraft expenses she had to pay when the joint chequing account was closed in December 2013, or $582.94. I disagree. The Applicant has provided no documentary evidence in terms of the amount of the overdraft she was charged or the amount she actually paid. Further, she agreed that she used the joint account exclusively for several months prior to it being closed.

(iii) Farm Expenses

59The Applicant is seeking $14,130.00 from the Respondent for farm expenses she testified she paid from September 2011 until November 2014. She states that during this time the Respondent had exclusive use of the farm and should have been paying all expenses.

60I do not accept that the Respondent had exclusive use of the farm. There was no order for exclusive possession. The Respondent testified that he did not have nor did he seek an order for exclusive possession of the farm. The Applicant was always welcome to come and go on the farm and did in fact attend for many family celebrations. This is consistent with the parties’ efforts to reconcile through to May 2013 and I accept it.

61Further, the Applicant’s own chart offered as evidence of this claim for relief shows that until December 2013, all expenses for the farm were paid from the joint chequing account; the account into which virtually all payments were made by the Respondent. There is no documentary evidence offered to the Court that the insurance for the farm was charged as listed in the Applicant’s chart in 2014 or that it was in fact paid by the Applicant from her personal account.

(iv) CIBC Visa

62The Applicant seeks $9,408.30 for charges made to her CIBC visa card by the Respondent in March, April and December 2012. Two charges are for Devil’s Glenn Country Club ($3,122.08 and $3,482.01) and one is for a repair to the Respondent’s vehicle ($2,804.21).

63The Respondent testified that the two charges for Devil’s Glenn relate to a ski club membership for Cameron. He admits that the third charge refers to a payment of a car repair and states that it was a gift from the Applicant to help the Respondent with a car repair so that he could look for work.

64During this time, March, April and September 2012, the parties were making efforts to reconcile. The Respondent did not have a secondary card as that was cancelled in April 2011. The Respondent was seeking employment to refocus his career and the Applicant’s credit card was paid out of the joint chequing account into which the Respondent made virtually all the payments.

65For these reasons, I accept the evidence of the Respondent and no payment is owing to the Applicant.

(c) Calculation of child support from January 1, 2015 onward, if any, for Michael and Kathryn

(i) Michael

66As noted above, Michael was born on July 2, 1997. Michael is currently in Grade 12 at Bishop Allen Academy in Toronto, Ontario. Michael lives full time with the Applicant.

67An order for the support of Michael may be made under the Divorce Act. The quantum of the support order must be determined with reference to the Child Support Guidelines.

68The Respondent’s line 150 income in prior years has been: $176,556 in 2009; $175,918 in 2010; $183,434 in 2011; $176,858 in 2012; $163,819 in 2013; and $54,255 in 2014. The Respondent’s financial statement sworn January 14, 2015 lists his total amount of yearly expenses as $77,708.40.

69The Respondent submits that he is just not able at this time to provide child support for Michael. He has committed to keeping the Applicant advised about his legal proceedings for disability benefits and any changes in his ability to seek employment. In my view, however, such an undertaking is wholly deficient. The Respondent is to provide child support at an imputed net income based on his 2014 yearly expenses of $77,000.00.

70Under the Federal Child Support Guidelines, SOR/97-175, s. 16, the amount of child support payable by a parent is dependent on his or her annual income. The starting point for determining annual income is the amount set out as “Total Income” in the T1 General Form issued by Revenue Canada (“Line 150” of the Income Tax Form). This amount may be adjusted in specified circumstances. Pursuant to s. 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.

71Alternatively, the Court may impute income to the payor parent. Pursuant to s. 19(1) of the Federal Child Support Guidelines, the Court has discretion to impute income to a parent, in an amount that it considers appropriate in the circumstance. Those circumstances include:

(a) The spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;

72Section 19(1) is intended to capture cases that in fairness require an adjustment to the payor’s presumptive income: Bak v. Dobell, 2007 ONCA 304, [2007] O.J. No. 1489 (Ont. C.A.), at para. 33. It my view, fairness in this case mandates an adjustment. Other than the Respondent’s statements, there is no evidence that his health needs render him unable to work. He continues to “network” by his own admission. And he sustains a standard of living consistent with his earnings prior to his claim for disability. In these circumstances, I am satisfied that the Respondent is intentionally unemployed. It is therefore appropriate to impute income to the Respondent based on the evidence of his standard of living.

73Counsel for the Applicant provided the Court with the Divorce Mate child support table calculation using an imputed annual non-taxable income of $77,000. The auto gross up therein is $106,850. The table amount for one child is $934/month. Counsel for the Applicant did not object to the accuracy of the Divorce Mate inputs or calculations. The Respondent shall therefore pay child support to the Applicant for Michael for the months of September, October, November, December, January, February, March and April, in the amount of $934.00/month.

(ii) Kathryn

74As noted above, Kathryn was born on February 1, 1994. Kathryn is currently in her third year of studies at Queen’s University in Kingston, Ontario and lives with her mother during the summer break.

75The Respondent submits that Kathryn should not be considered a child for whom support should be payable to the Applicant. She is 21 years old and in her third year of University. She lives in Kingston and has been able to contribute to her own needs by way of OSAP and part-time employment earnings. It is argued therefore that the “presumptive rule” that the Guidelines should be applied does not apply to her situation.

76The Applicant argues that Kathryn should be considered a child of the marriage for whom support should be payable in accordance with the presumptive approach, until the end of her first University degree.

77As stated by M.A. Sanderson J. in Wegler v. Wegler, 2012 ONSC 5982, [2012] O.J. No. 5129, at para. 68, referencing Rebenchuk v. Rebenchuk, 2007 MBCA 22, [2005] M.J. No. 201,

It can now be safely stated that the following three steps need to be addressed in circumstances such as those before us:

Step 1: Is the person for whom support is sought a “child of the marriage”?

Step 2: Is the table amount in the Guidelines “inappropriate”? If not, then the Guidelines amount should be awarded.

Step 3: If the answer to Step 2 is “yes,” what level of support is "appropriate"?

a. Is Kathryn a “child of the marriage”?

78Section 15.1 of the Divorce Act grants the court discretion to make an order for the support of any children of the marriage and to impose terms and conditions that it deems fit and just. Section 15.1 states in relevant part:

(1) A court of competent jurisdiction may, on application by either or both spouses, make an order requiring a spouse to pay for the support of any or all children of the marriage.

Guidelines apply

(3) A court making an order under subsection (1) or an interim order under subsection (2) shall do so in accordance with the applicable guidelines.

Court may take agreement, etc., into account

(5) Notwithstanding subsection (3), a court may award an amount that is different from the amount that would be determined in accordance with the applicable guidelines if the court is satisfied

(a) that special provisions in an order, a judgment or a written agreement respecting the financial obligations of the spouses, or the division or transfer of their property, directly or indirectly benefit a child, or that special provisions have otherwise been made for the benefit of a child; and

(b) that the application of the applicable guidelines would result in an amount of child support that is inequitable given those special provisions.

Reasons

(6) Where the court awards, pursuant to subsection (5), an amount that is different from the amount that would be determined in accordance with the applicable guidelines, the court shall record its reasons for having done so.

79When the child is over the age of majority, dependency is the key criterion for entitlement to support: McCrea v. McCrea, [2005] O.J. No. 50, at para. 11. In Farden v. Farden (1993), 1993 CanLII 2570 (BC SC), 48 R.F.L. (3d) 60 (B.C.S.C.), at para. 15, the Court found that a number of factors (the “Farden Factors”) are relevant to the question of dependency where the child is pursuing an education:

1. whether the child is in fact enrolled in a course of studies and whether it is a full-time or part-time course of studies;

2. whether or not the child has applied for or is eligible for student loans or other financial assistance;

3. the career plans of the child, i.e. whether the child has some reasonable and appropriate plan or is simply going to college because there is nothing better to do;

4. the ability of the child to contribute to his own support through part-time employment;

5. the age of the child;

6. the child’s past academic performance, whether the child is demonstrating success in the chosen course of studies;

7. what plans the parents made for the education of their children, particularly where those plans were made during cohabitation;

8. at least in the case of a mature child who has reached the age of majority, whether or not the child has unilaterally terminated a relationship from the parent from whom support is sought.

80In my view, Kathryn remains a “child of the marriage”. Other than debt, she makes negligible income and is enrolled at Queen’s in full time studies. She is receiving a student loan from the Ontario government (OSAP) and has earned only $2,500 in part-time income. Kathryn lives with the Applicant during the summer months and returns by bus for visits and holidays. She maintains a relationship with the Respondent, who has guaranteed a line of credit for her for educational purposes.

b) Is the table amount in the Guidelines inappropriate?

81Section 3(1) of the Federal Child Support Guidelines provides the presumptive rule for the application of the table amounts. It states:

Unless otherwise provided under these Guidelines, the amount of a child support order for children under the age of majority is

(a) the amount set out in the applicable table, according to the number of children under the age of majority to whom the order relates and the income of the spouse against whom the order is sought; and

(b) the amount, if any, determined under section 7.

82Section 3(2) of the Guidelines specifically addresses child support orders in relation to children over the age of majority. It states:

Unless otherwise provided under these Guidelines, where a child to whom a child support order relates is the age of majority or over, the amount of the child support order is

(a) the amount determined by applying these Guidelines as if the child were under the age of majority; or

(b) if the court considers that approach to be inappropriate, the amount that it considers appropriate, having regard to the condition, means, needs and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child.

83The Respondent challenges the suitability of the presumptive approach for Kathryn. But for the summer months and holidays, Kathryn lives away from home. During the academic year, her circumstances are sufficiently unlike those on which the usual Guidelines approach is based to warrant a derogation from the Guidelines: James C. MacDonald, Q.C. and Ann C. Wilton, Child Support Guidelines: Law and Practice, 2nd ed., vol. 1 (Toronto: Carswell, 2004), at pp. 3-11, 3-12. Kathryn lives in a rented home with four other women during the academic year. She buys her own food and is responsible for the needs of her daily academic life. I find that it would be inappropriate therefore for the Respondent to pay full Guideline child support for Kathryn while Kathryn is away at school.

84Taking into consideration s. 3(2) of the Guidelines, I find that it would not be inappropriate that the Respondent pay the table amount of child support for Kathryn for the four summer months when Kathryn resides with the Applicant, as if Kathryn were a minor. Counsel for the Applicant provided the Court with a Divorce Mate calculation for table child support for two children based on imputed annual net income of $77,000 and an auto gross up of $106, 850. There was no objection by the Respondent to the accuracy of the Divorce Mate calculation. The Respondent shall therefore pay child support to the Applicant for Kathryn and Michael in each of May, June, July and August of $1,499/month.

c. What level of support is appropriate while Kathryn is away at school?

85To determine Kathryn’s child support, including s. 7 expenses, during the academic year it is necessary to embark on an assessment of Kathryn’s needs for the period of the year she resides in Kingston, and apportion those needs between the parents, after taking into account Kathryn’s contribution, if any: Park v. Thompson, 2005 CanLII 14132 (ON CA), [2005] O.J. No. 1695 (Ont. C.A.) at para. 28. Given the evidence before the Court, this exercise proves difficult.

86The evidence is that Kathryn receives OSAP, but the amount of the loan is unknown. There is no evidence in terms of applicable scholarships, bursaries or grants or the amount of any RESP. There is evidence that Kathryn has access to a line of credit guaranteed by the Respondent, but the amount available for her to access and the applicable interest obligations are unknown. . The Respondent believes there is about $6,000.00 available but no bank documents were filed with the Court. There is a suggestion that her school tuition is between $5,000.00 to $7,000.00 but nothing from the school was provided to the Court. The Applicant believes that Kathryn’s rent is $600/month and her utilities are $100/month but no lease was filed with the Court, and $100/month for utilities seems high as Kathryn lives with four other women. The Applicant testified that Kathryn’s food costs are $50/month. No evidence is before the Court with respect to Kathryn’s plans for summer employment this year.

87Clearly more cogent evidence is available to assist the Court with the necessary assessment. As noted above, I allowed re-reply evidence on this issue and yet neither party, particularly the Applicant, provided the Court with actual expenditures. I am certainly not going to guess or speculate on this important issue. Neither however will I dismiss the claim outright for want of evidence given that it pertains to child support for Kathryn.

88Section 7 of the Child Support Guidelines provides:

(1) In a child support order the court may, on either spouse’s request, provide for an amount to cover all or any portion of the following expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child’s best interests and the reasonableness of the expense in relation to the means of the spouses and those of the child and to the family’s spending pattern prior to the separation:

(d) expenses for post-secondary education;

Sharing of expense

(2) The guiding principle in determining the amount of an expense referred to in subsection (1) is that the expense is shared by the spouses in proportion to their respective incomes after deducting from the expense, the contribution, if any, from the child.

89Justice Ricchetti in Roth v. Roth, 2010 ONSC 2532, [2010] O.J. No. 1934, at para. 16, succinctly set out the principles applicable to post-secondary expenses as follows:

The following principles can be ascertained when dealing with post secondary expenses of a child of the marriage:

a) Generally, post secondary education is considered a necessary expense in the best interests of the children. Certainly, there was no argument to the contrary in this case.

b) The reasonableness of the expense considers the means of the spouses or former spouses and the means of the child.

c) Children have an obligation to make a reasonable contribution to their own post-secondary education or training. This does not mean that all of a child’s income should necessarily be applied to the costs of the child’s further education. The court should consider whether the child should be entitled to some personal benefit from the fruits of his or her labours.

d) Grants, scholarships and bursaries are generally treated as a reduction of the education expense as they involve a net transfer of resources to the child without any obligation of repayment.

e) A student loan is not a “benefit”, within the meaning of section 7(3) of the Guidelines that must be automatically taken into account in determining the amount to be ordered in respect of s. 7 expenses. A student loan may constitute, in whole or in part, a “contribution… from the child” to post-secondary education expenses within the meaning of section 7(2) of the Guidelines and thereby exclude or reduce the need for any parental contribution. This turns on the reasonableness of taking account of any such loans in the circumstances of the case.

f) In determining the amount of an expense or the contribution thereto under section 7 of the Federal Child Support Guidelines, the guiding principle is that, once the court has determined the appropriate amount of contribution by the spouses or former spouses, the spouses or former spouses should share the expense in proportion to their respective incomes after deducting any contribution from the child, or other liable parent. (see Lewi, at para. 157). [Emphasis original.]

90Justice Czutrin dealt with the issue of student loans further in Jordan v. Stewart, 2013 ONSC 902, [2013] O.J. No. 903, and stated at para. 239:

Most courts are reluctant to allow the payor parent to avoid child support obligations by requiring that the child rely on student loans since student loans are just costs that must be repaid when the child finishes school (Caterini v. Zaccaria, 2010 ONSC 6473, 2010 ONSC 6473, [2010] O.J. No. 5291, at para. 203).

91I find that it is reasonable to expect a contribution from Kathryn toward her post-secondary expenses, even if the contribution must come through OSAP or the line of credit made available to her with the assistance of her father. At this time neither parent has line150 income, they both have significant debt and their finances are in transition.

92Counsel for the Applicant concedes that the Applicant should contribute to these expenses. He suggests that she be attributed 25% of these expenses. Rather than simply accepting the ratio proffered, in my view, it is appropriate to impute income to the Applicant in accordance with the minimum wage in Ontario, or $23,000.00. The Applicant intends to return to school and upgrade her skills. This is her choice. There is nothing to suggest however that she could not obtain employment if she so chooses. She has been resourceful in the past, either working from home or with a friend.

93As noted above, the Court has not been presented with meaningful evidence to assess the parents’ and the child’s specific contribution. It is not in the best interest of Kathryn however to dismiss the Applicant’s claim for want of evidence. For this reason, I direct the following formula.

94Within 30 days, the Applicant shall provide the Respondent with proof of the amount of any scholarships, grants or bursaries received by Kathryn for this academic year. Proof of any loans and employment funds of Kathryn for this academic year shall also be provided by the Applicant to the Respondent within 30 days. The parties shall deduct the full amount of any bursary, grant or scholarship received from the outstanding post-secondary expenses, and after that deduction, the Respondent shall pay one half, the Applicant shall pay one-quarter and Kathryn shall pay one-quarter towards Kathryn’s post-secondary expenses including tuition, books, rent or residence costs and public transit costs with the expectation that Kathryn will use some of her OSAP funds or employment income to fund her one-quarter contribution each year. Prior to payment, the Applicant shall provide the Respondent with proof of these expenses.

95There is also the issue of child support for Kathryn while she is attending university in Kingston and not residing with the Applicant. I find that it is also appropriate that the Respondent pay $100 per month to the Applicant for Kathryn’s support for the months of September to April to assist with the Applicant’s costs of providing care packages, bus rides back to Toronto and other expenses while away at school and for a portion of the household costs she is required to maintain when Kathryn is at home on visits and holidays.

Disposition

96For reasons noted above, the following orders are made:

1. No later than March 27, 2015, pursuant to s. 9 (1) of the Family Law Act, R.S.O. 1990, C. F.3. (“FLA”), the Respondent shall take all necessary steps to effect the transfer to the Applicant of $394,696.00 from his pension for the satisfaction of his obligation in the equalization of the family property.

2. Pursuant to s. 3 of the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.), a divorce is granted. It shall take effect 35 days from today.

3. Commencing January 1, 2015, in accordance with the Child Support Guidelines, and an imputed gross income to the Respondent of $106,850.00, the Respondent shall pay child support to the Applicant for Michael in the amount of $934.00/month in each of the months of September, October, November, January, February, March and April.

4. Commencing January 1, 2015, in accordance with the Child Support Guidelines, and an imputed gross income to the Respondent of $106,850.00, the Respondent shall pay child support to the Applicant for Michael and Kathryn in the amount of $1,499/month in each of the months of May, June, July and August.

5. Commencing January 1, 2015, in accordance with the Child Support Guidelines and an imputed gross income to the Respondent of $106,850.00 and an imputed gross income to the Applicant of $23,000.00, the Respondent shall pay child support to the Applicant for Kathryn in the amount of $100.00/month is each of the months of September, October, November, January, February, March and April.

6. Within 30 days, the Applicant shall provide the Respondent with proof of the amount of any scholarships, grants or bursaries received by Kathryn for this academic year. Proof of any loans and employment funds of Kathryn for this academic year shall also be provided by the Applicant to the Respondent within 30 days. The parties shall deduct the full amount of any bursary, grant or scholarship received from the outstanding post-secondary expenses, and after that deduction, the Respondent shall pay one half, the Applicant shall pay one-quarter and Kathryn shall pay one-quarter towards Kathryn’s post-secondary expenses including tuition, books, rent or residence costs and public transit costs with the expectation that Kathryn will use some of her OSAP funds or employment income to fund her one-quarter contribution each year. Prior to payment, the Applicant shall provide the Respondent with proof of these expenses.

7. A support deduction order is to issue.

8. All remaining claims of the parties respectively is dismissed.

Costs

97The parties are encouraged to agree on an appropriate award of costs given my reasons above. If by 30 days the parties have not agreed, I shall receive written submissions of not more than 2 pages, a costs outline and any offers to settle, first by the Applicant within 30 days, followed by the Respondent within 20 days thereafter.

CHIAPPETTA J.

Released: February 23, 2015

CITATION: Rzadki v. Rzadki, 2015 ONSC 1166

COURT FILE NO.: FS-10-357734

DATE: 20150223

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

GAYLE RZADKI

Applicant

• and –

PETER RAZADKI

Respondent

REASONS FOR JUDGMENT