Editor’s note: Corrigendum released on February 5, 2015. Original judgment has been corrected with text of corrigendum appended.
CITATION: Yar v. Yar, 2015 ONSC 151
HAMILTON COURT FILE NO.: D705/08
DATE: 2015/01/19
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
QASIM ABRAHAM YAR
Jerry J. Chaimovitz, for the Applicant
Applicant
- and -
ROYA FATEMEH YAR
Thomas G. Bastedo and Jennifer Swan, for the Respondent
Respondent
HEARD at Hamilton: June 9, 10, 11, 12, 13, 16, 17, 18, 19, 20, 23, 24, 25, 26, July 7 & 8, 2014
The Honourable Madam Justice L.M. Walters
Overview
[1] Notwithstanding countless motions, two lengthy trials, an appeal, untold hours of attempted settlement discussions and who knows how many hundreds of thousands of dollars spent in legal fees, this is, for the most part, not a complicated matter.
[2] The difficulty, however, has been two litigants so firmly entrenched in their positions that they have been unable or unwilling to concede the smallest matter.
[3] There are basically four issues to be determined:
(i) The validity of the Mahr;
(ii) Child support, including the amount of s. 7 extraordinary expenses;
(iii) Equalization of net family property and post separation adjustments; and
(iv) Spousal support.
[4] These issues arise from the marriage breakdown of Dr. Qasim Abraham Yar (hereinafter referred to as “Qasim”) and Dr. Roya Fatemeh Yar (hereinafter referred to as “Roya”) on November 17, 2007.
[5] Qasim was born in Afghanistan on December 22, 1957. He is currently 57 years of age.
[6] Roya was born in Iran on March 25, 1963. She is currently 51 years of age.
[7] The parties married in a civil ceremony on October 7, 1991 in the United Kingdom.
[8] On February 27, 1993, in Germany, the parties married in a Muslim ceremony. At that time, a Mahr was executed by the parties.
[9] There are two children of the marriage. Sanam was born April 7, 1994. She is attending Queen’s University and at the time of trial had completed her second year. Saba was born November 19, 1999 and he attends Hillfield-Strathallan College, a private school in Hamilton.
[10] The parties had one previous separation in 1995 and reconciled in 1996.
[11] After the November 17, 2007 separation, the parties continued to live separate and apart in the matrimonial home located at 136 Joshua Avenue, in the City of Ancaster. On March 20, 2008, Qasim vacated the matrimonial home while Roya was vacationing with the children in Panama.
[12] This action was started on April 27, 2008 and since that date, to say that the proceedings have been voluminous, would be an understatement.
[13] Pursuant to the temporary order of Steinberg J. dated April 8 and 9, 2010, Qasim has been paying child support of $7,212.00 a month, based on an imputed income of $600,000.00 a year. In addition, he was obliged to pay 77% of the children’s tuition, books and school trips within Ontario. There is no dispute that Qasim has faithfully complied with this court order and no arrears have accumulated.
[14] Prior to Justice Steinberg’s order, the evidence of the applicant, which I accept, is that he paid some $163,000.00 for the benefit of the children. The bulk of that money is comprised of tuition at Hillfield-Strathallan College.
[15] Justice Steinberg also dismissed Roya’s claim for spousal support, however, this was without prejudice to Roya making a claim for retroactive spousal support at trial.
[16] This matter was originally tried in front of Festeryga J. in October and November, 2010.
[17] Festeryga J.’s judgment, as it related to property and support issues, was set aside by the Ontario Court of Appeal and a new trial ordered. Although expedited, for various reasons, the trial did not proceed until June 2014.
[18] The trial lasted some 16 days and the court heard from several witnesses. Eighty exhibits were filed. I have no intention of summarizing in detail the evidence of the witnesses. Instead, as I discuss each of the four issues to be determined, I will review the relevant evidence pertinent to that issue.
[19] At the outset, I will deal with the issue of credibility. Each of the parties testified at length. Much of their evidence is at odds.
[20] Although the applicant was unable to answer most questions in a direct or straightforward manner, in the end, I found him credible. Much of what he testified to could be supported or corroborated by some other evidence. I was not of the view that Qasim attempted to hide information from the court regarding his income or expenses.
[21] The same cannot be said for Roya. I find that Roya purposely failed to provide pertinent information and much of the information she did provide was only done after numerous motions and/or orders of the court.
[22] More troubling, much of the financial information provided by Roya is suspect.
[23] Roya did not adequately respond to Qasim’s serious allegations that she intentionally reported inaccurate income on her tax returns. She did not deny that deposits that should have been income to her professional corporation were deposited into other accounts or that she, at times, inflated expenses to reduce her income.
[24] It is very troubling to the court that the accountant, Mr. Avanessy, testified that he prepared the respondent’s returns in the past, however, he stopped doing this work for her because she wanted him to understate her income. Again, this very serious allegation was never denied by the respondent.
[25] Roya was incensed that the Royal Bank, pursuant to a production order, provided the applicant, and ultimately the court, with copies of bank accounts in the children’s names. These accounts demonstrated that the bulk of the support ordered by Justice Steinberg was placed in an account with Roya and her children and not used until Roya purchased Qasim’s interest in jointly owned properties. After that date, the accounts were transferred to the name of the children alone preventing any further disclosure of that information. Roya’s testimony was that she did this once her daughter came of age. However, her daughter turned 18 a year before the monies were transferred. Instead, I find that the transfer was done solely with the intent of preventing disclosure of this information to the applicant and the court.
[26] It was not until the court ordered Roya, in the course of her examination on the witness stand to produce information regarding her daughter’s finances, that the information was provided, and even then, only in submissions.
[27] The court had difficulty believing some of Roya’s evidence as it related to some very contentious issues. For example, her evidence regarding monies her mother sent to her in May 2005, including what she said was money from her brother for immigration purposes, was not believable. I did not accept her evidence regarding supposedly missing jewelry. Roya testified that her 2007 income tax return was amended, however, she could not verify that in fact, the return had been filed with Revenue Canada. No notice of reassessment was ever produced.
[28] Roya’s credibility before the court has been seriously undermined.
[29] This does not mean to say that I have accepted everything Qasim testified to. However, for the most part, where his evidence is in conflict with that of Roya, I have preferred the evidence of Qasim.
[30] I will now turn to the four issues to be determined.
(i) The validity of the Mahr
[31] A traditional Muslim marriage is regulated by Islamic law. The husband and wife enter into a contract of marriage. A valid contract requires an offer, an acceptance and a Mahr (also referred to as a Maher). The Mahr is an amount the husband pledges to pay the wife as a bride price or dowry. The Mahr is deemed the wife’s separate property. The amount of the Mahr is subject to negotiations.
[32] Although there was some dispute as to whether these traditional marriage contracts under Muslim law could be enforced in Canada, that disagreement was resolved by the Supreme Court of Canada in Bruker v. Marcovitz, 2007 SCC 54. There, the court held that just because a contractual agreement has a religious aspect to it, does not prevent the court from determining the enforceability of the agreement if it satisfies the necessary requirements.
[33] In Khanis v. Noormohamed, 2011 ONCA 127, [2011] O.J. No. 667 W.D.F.L. 1531, the Ontario Court of Appeal upheld the decision of Backhouse J. who enforced a Mahr agreement, which was in writing, signed by both parties and witnessed, thereby complying with the provisions of the Family Law Act.
[34] Both parties called expert witnesses regarding Islamic law and the validity of this marriage contract pursuant to Islamic law. Although interesting, whether or not this marriage contract is valid under Islamic law is not determinative of the issue in Ontario. To be enforceable in Ontario, the contract must meet the legal requirements set out in the Family Law Act, the relevant portions of which are as follows:
Marriage contracts
- (1) Two persons who are married to each other or intend to marry may enter into an agreement in which they agree on their respective rights and obligations under the marriage or on separation, on the annulment or dissolution of the marriage or on death, including,
(a) ownership in or division of property;
(b) support obligations;
(c) the right to direct the education and moral training of their children, but not the right to custody of or access to their children; and
(d) any other matter in the settlement of their affairs.
Form of contract
- (1) A domestic contract and an agreement to amend or rescind a domestic contract are unenforceable unless made in writing, signed by the parties and witnessed.
Setting aside domestic contract
- (4) A court may, on application, set aside a domestic contract or a provision in it,
(a) if a party failed to disclose to the other significant assets, or significant debts or other liabilities, existing when the domestic contract was made;
(b) if a party did not understand the nature or consequences of the domestic contract; or
(c) otherwise in accordance with the law of contract.
Contracts made outside Ontario
- The manner and formalities of making a domestic contract and its essential validity and effect are governed by the proper law of the contract, except that,
(a) a contract of which the proper law is that of a jurisdiction other than Ontario is also valid and enforceable in Ontario if entered into in accordance with Ontario’s internal law;
(b) subsection 33 (4) (setting aside provision for support or waiver) and section 56 apply in Ontario to contracts for which the proper law is that of a jurisdiction other than Ontario; and
(c) a provision in a marriage contract or cohabitation agreement respecting the right to custody of or access to children is not enforceable in Ontario.
[35] Here, there is no question that the marriage contract is in writing, signed by both parties and witnessed. On first blush, it would appear to be a valid contract. However, s. 56 (4) permits the court to set aside such a contract if certain circumstances exist. With respect to this particular contract, the greatest concern to the court is that the document is written in Arabic. The evidence is clear that neither party speaks, writes or reads Arabic.
[36] According to the video and the evidence of both Qasim and Roya, the contract was filled out and completed by others before Qasim and Roya even entered the room. There was no time for review or independent legal advice. Qasim’s evidence, which I accept, was that there were no prior negotiations. I reject Roya’s evidence that there were any negotiations. At the first trial, Roya testified that Qasim’s brother, Hashim, did the negotiating on Qasim’s behalf. Hashim was called as a witness at this trial and he testified that he had nothing to do with the negotiation of any Mahr. After hearing that evidence, Roya testified before me that she does not know which of Qasim’s brothers did the negotiation. Her mother and sister parroted the same evidence. The person who had the most knowledge and according to Roya was the one who negotiated on her behalf was her father who was not called as a witness. There was no explanation as to why he could not have testified. Both her mother and sister were called as witnesses. In these circumstances, an adverse inference is drawn that Roya’s father would be unable to assist her with respect to this issue.
[37] As the contract is written in a language that Qasim neither reads nor understands, the court is not satisfied that he understood the nature of what he was signing.
[38] Further confusion is evident on the video of the wedding itself. When Qasim is asked if he accepts the amount of the Mahr and he says “yes,” but there is no mention of the currency involved. This is a fundamental omission.
[39] The written document in Arabic sets out that the early or advanced payment is 100 German Marks and the late or deferred payment is 1,000,000 German Marks.
[40] Not only is Qasim not asked what currency the Mahr is to be paid in, there is some confusion as to what exactly was asked and answered. Mr. Parviz Parvizian, an interpreter, gave several different translations of the same sentence he says was put to Qasim. A transcript of that portion of his evidence includes the following translations for the same sentence:
(a) Mr. Groom, do you want... you agree with 1,000,000 as you yourself agreed?
(b) Mr. Groom, do you accept the 1,000,000 that you yourself accepted?
(c) You accept the 1,000,000 that you agreed yourself?
(d) Do you the Groom accept marriage portion of 1,000,000 as you have said yourself?
(e) Mr. Groom, do you accept the Mahr of 1,000,000 which you agreed which you accepted yourself?
(f) Mr. Groom, do you accept the marriage portion of 1,000,000 that you said yourself?
[41] The amount of this Mahr is not insignificant. This does not mean to say that this alone would invalidate the agreement if the contract meets the legal requirements set out in the Family Law Act. However, before the court is prepared to enforce such a term, it must be satisfied that the parties to the agreement were of a like mind, knew what they were agreeing to, and were agreeing to be bound by the terms of the contract.
[42] In the circumstances of this case, I am not satisfied that this has occurred and, accordingly, I find that the Mahr shall be set aside and is not enforceable pursuant to Ontario law.
(ii) Child support, including the amount of s. 7 extraordinary expenses
[43] In order to determine the appropriate amount of child support, the court must first determine the income of the parties.
[44] I will deal with Qasim’s income first.
[45] Qasim is the emergency room lead physician at West Haldimand General Hospital. Qasim operates his practice through a professional corporation – Qasim Yar Medicine Professional Corporation. He is the sole shareholder of the company.
[46] Qasim retained the services of Durward Jones Barkwell Chartered Accountants to compare various reports estimating Qasim’s income for support purposes from 2007 to and including 2012. Those reports (including their reports regarding Roya’s income as well) were filed as Exhibit 42.
[47] Mr. Pyper and Mr. Smith both testified regarding the contents of the report and, to summarize, Durward Jones Barkwell determined Qasim’s income for support purposes to be as follows:
2007 $597,000.00
2008 $632,000.00
2009 $669,000.00
2010 $411,000.00
2011 $408,000.00
2012 $486,000.00
[48] DJB prepared amending reports as they originally failed to apply gross-ups to income. This was corrected in subsequent reports.
[49] Not surprisingly, the respondent also retained an expert to determine Qasim’s income for support purposes. Christine Larkin’s report was filed as Exhibit 68 and she also testified at trial. For the same six year period of time, Ms. Larkin determined Qasim’s Guideline income to be as follows:
2007 $793,936.00
2008 $835,684.00
2009 $760,799.00
2010 $602,271.00
2011 $531,634.00
2012 $579,833.00
[50] In each case, the experts agree on Qasim’s adjusted Line 150 personal income. The difference in their reports stems from their determination of what adjusted income is available for support from Qasim’s professional corporation. Each accountant made their own judgment calls regarding the reasonableness of any expense claimed by Qasim. The largest areas of dispute between the respective reports relate to Qasim’s home office, his vehicle expenses and the almost $105,000.00 he paid to his niece or her company for computer consulting. There were also differences in what amounts should be allowed for advertising and promotion, office expenses and office salaries. Ms. Larkin’s report also included additional amounts of monies she assumed were unreported income on the part of Qasim.
[51] For the reasons which follow, I have preferred the reports and evidence of Mr. Pyper and Mr. Smith to that of Ms. Larkin.
[52] The evidence of Qasim, which I accept and which was supported by the financial information before the court, is that Qasim’s sources of professional income are from OHIP, West Haldimand General Hospital and WSIB. He also earns interest on retained earnings. All income earned by Qasim is reported in his corporation. The total pre-tax revenue in Qasim’s corporation, including investment income for the relevant years, is as follows:
2007 $676,341.00
2008 $726,071.00
2009 $632,086.00
2010 $559,962.00
2011 $429,587.00
2012 $589,116.00
2013 $589,062.00
[53] However, for the same time period, after making all the adjustments set out in her report and as testified to, Ms. Larkin finds the following amounts of income available for Guideline support.
2007 $793,936.00
2008 $835,684.00
2009 $760,799.00
2010 $602,271.00
2011 $532,634.00
2012 $579,833.00
[54] This makes absolutely no sense. These numbers are before any income tax or deductions for proper business expenses. For this reason alone, I have difficulty accepting the assumptions, conclusions and calculations as performed by Ms. Larkin.
[55] There are other concerns. Ms. Larkin relied upon and referenced a Vine report which was never presented at trial or subject to cross-examination.
[56] The DJB report found that Qasim failed to report some income in certain years. In addition to those amounts, which have been acknowledged by Qasim, Ms. Larkin found other amounts which she determined were unreported income on behalf of Qasim. In his re-examination, Qasim was able to satisfy the court that the numbers in question related to income tax refunds which are not included in income. Other amounts were transfers of funds and not deposits.
[57] With respect to the other differences or judgment calls made by the two accountants, obviously what expenses are or are not personal in nature is not an exact science. Experts often disagree. However, Mr. Pyper was able to explain in each instance how he questioned Qasim about certain expenditures and, if he accepted his explanation as reasonable, adjusted entries accordingly. Ms. Larkin, obviously, did not have the same access to Qasim and was preparing her report on the eve of trial. Accordingly, her judgment calls were based on her years of experience in similar situations, however, she did not have first-hand discussions with Qasim regarding the reasonableness of any expense claimed. In my view, this put her at a disadvantage. She then made assumptions that were not supported by the evidence before the court. For example, she had no information about Qasim’s home office, the nature of his employment, particulars regarding office employees, advertising and promotion, or office expenses. It is of note that Qasim was never cross-examined with respect to any of these expenses that he claimed. In his professional opinion, Mr. Pyper accepted Qasim’s explanations as reasonable.
[58] The court may impute additional income to a parent who “unreasonably deducts expenses from income.” (Section 19(1)(g) Child Support Guidelines). In Osmar v. Osmar, 2000 CanLII 22530 (ON SC), 8 R.F.L. (5th) 368 (Ont SCJ), Aston J. stated, at para. 5, the following:
If is fair to conclude that judicial discretion in this area makes the determination of income more of an art than a science. In my view, the Guidelines require the court to examine expenses from the perspective of balancing the business necessity against the alternative of using those funds for child support. The court should respect the right of self‑employed persons to run their business as they see fit, but may, nevertheless, question whether particular expenditures ought to be indirectly subsidized by lower child support.
[59] It is also true that just because certain expenses are properly included as business expenses for tax purposes, does not prevent the court from examining those expenses.
[60] Unlike in some cases, the court does not have the benefit of all of the invoices to show if expenses are personal in nature or, for some other reason, not reasonable business expenses. Without this evidence, I am satisfied with and accept the professional opinion of Mr. Pyper and Mr. Smith as to the reasonableness of the expenses incurred by Qasim.
[61] I think it is also important to note that this is certainly not a situation where the children are receiving a sub-standard level of child support because of expenses claimed by Qasim. Although information regarding the children’s lifestyle is scanty, they attended private high school; Sanam is now attending Queen’s University and the matrimonial home they continue to live in is valued at in excess of $600,000.00. There was no evidence elicited from Qasim as to a personal component for the expenses which he claimed.
[62] Accordingly, I fix the applicant’s income for support purposes as determined by DJB Chartered Accountants for the 2007 and 2012 years.
[63] In 2013, the applicant’s T-4 income from his corporation was $350,000.00. With dividends, interest and capital gains, his total Line 150 income was $364,344.00. The pre-tax income, after expenses, for his corporation for the June 30, 2013 year was $124,921.00. There were no adjustments to this amount to take into account any personal expenses which may have been paid by the corporation (for example, the personal use portion of his motor vehicle). In my view, there must be some upward adjustment to take into account these amounts. Accordingly, I fix Qasim’s income for the 2013 year at $500,000.00.
[64] Having determined what Qasim’s income was for the past seven years, the court must determine whether or not the applicant is intentionally under-employed as a result of his decision to change his work schedule in 2010, which resulted in a reduction in his income.
[65] The respondent has asked that the court impute income to Qasim of $600,000.00 per year. There is no question that, at the time of separation, Qasim was working significantly more hours in the emergency room. In 2010, he shifted his practice away from emergency room work to office and administrative work. This was a deliberate decision on his part, and the result is that his income has gone down. Interestingly, however, Exhibit 7 confirms Qasim’s actual work hours have not been reduced.
[66] Section 19(1)(a) of the Child Support Guidelines permits a court to impute income if “the parent or spouse is intentionally underemployed and unemployed, other than where the underemployment or unemployment is required by the needs of any child or by the reasonable educational or health needs of the parent or spouse.”
[67] In Drygala v. Pauli, 2002 CanLII 41868 (ON CA), [2002] 61 O.R. (3d) 711, the Ontario Court of Appeal considered this section of the Guidelines. At paras. 45 and 46, Gillese J.A. stated:
[45] When imputing income based on intentional under- employment or unemployment, a court must consider what is reasonable in the circumstances. The factors to be considered have been stated in a number of cases as age, education, experience, skills and health of the parent. See, for example, Hanson, supra, and Cholodniuk v. Sears (2001), 2001 SKQB 97, 14 R.F.L. (5th) 9, 204 Sask. R. 268 (Q.B.). I accept those factors as appropriate and relevant considerations and would add such matters as the availability of job opportunities, the number of hours that could be worked in light of the parent's overall obligations including educational demands and the hourly rate that the parent could reasonably be expected to obtain.
[46] When imputing income, the court must consider the amount that can be earned if a person is working to capacity while pursuing a reasonable educational objective. How is a court to decide that when, typically, there is little information provided on what the parent could earn by way of part-time or summer employment? If the parent does not provide the court with adequate information on the types of jobs available, the hourly rates for such jobs and the number of hours that could be worked, the court can consider the parent's previous earning history and impute an appropriate percentage thereof.
[68] Was Qasim’s decision reasonable under all of the circumstances? In my view, it was. Qasim is 57 years of age. He works long hours. He has joined an FHO/FHT which provides certain benefits for him including access bonuses, and the ability to be paid for sick days and holidays. Prior to this, he only was paid if he worked. This provides more security, which is particularly important as he ages.
[69] More importantly, there is no evidence whatsoever that the change in work pattern had anything to do with an attempt to reduce his child support obligations. In fact, I have already determined Qasim, both before and after Steinberg J.’s order faithfully paid most expenses relating to the children.
[70] Emergency room work is very difficult. This was corroborated by the evidence of Dr. Cloate. By all accounts, Qasim is a very hard-working, dedicated, well-respected physician. He cannot be faulted for organizing his work as he has.
[71] In all of these circumstances, I am not prepared to impute any additional income to Qasim.
[72] Having determined Qasim’s income, it is clear that in accordance with the order of Justice Steinberg, he has overpaid child support from the date of the order to and including the end of December 2014.
[73] The respondent is claiming retroactive child support including s. 7 expenses from the date of separation until the commencement of the order of Justice Steinberg. In my view, the amount of monies already paid by Qasim, in addition to the overpayment of support as I have calculated, more than adequately takes care of any claim for child support and additional s. 7 expenses during this period of time.
[74] Accordingly, there will be no order for any further retroactive child support and a new support order will commence September 1, 2014 based on an imputed income of $500,000.00.
[75] Sanam is now 19 years of age. She will be 20 in April. When a child is over the age of majority, the amount of a support order is either the Guideline amount, or if the court considers that inappropriate, an amount having regard to the condition, means, needs and other circumstances of the child and financial ability of each parent. Unfortunately, here, the court has virtually no information about Sanam’s income or expenses. It wasn’t until ordered by the court that Roya produced a copy of Sanam’s 2012 income tax return and a bank statement dated June 2014. The court has no budget regarding what Sanam’s expenses are at Queen’s University, nor adequate information about education funds or scholarships she may have received. Is she working? Is she able to contribute in any fashion to her own post-secondary school education? Until 2013, the majority of all child support was saved in a bank account and not used until Roya purchased Qasim’s interest in the matrimonial home and the Carluke property. The court does not know where Sanam’s income was earned in 2012. The court does not have any information about her 2013 tax return, except for one T-5. As at June 30, 2014, she had some $32,000.00 sitting in a bank account.
[76] Obviously, while she is at Queen’s, Roya is not incurring the same costs she would incur if Sanam was living at home full time, however, the court is only speculating because I do not have sufficient evidence.
[77] Despite paying full Guideline support since the date of Justice Steinberg’s order, the applicant has also paid 77% of all tuition, books and school trips.
[78] In fairness, the applicant has not objected, and in fact, proposes that he continue to pay full Guideline support for both children despite Sanam’s age.
[79] Accordingly, commencing September 1, 2014, Qasim shall pay child support to Roya for the children, Sanam and Saba, in the amount of $6,002.00 per month, based on an imputed annual income of $500,000.00.
[80] Before I can deal with s. 7 expenses, a determination must be made of Roya’s income for support purposes.
[81] Roya obtained her Canadian Certificate of Family Physicians in 2001. In September 2001, she began to work full time. Originally, she operated her practice out of West Haldimand General Hospital and she also worked in the emergency department at the hospital.
[82] In the spring of 2003, Roya got into a disagreement with the hospital regarding her office rent. Roya was under the mistaken impression that she was receiving free rent for their home, where in fact, Qasim was paying the rent unbeknownst to her. She withheld her rent for a period of time and this caused certain difficulties with the hospital.
[83] In September 2004, Roya was involved in a dispute between the College of Physicians and Surgeons and the hospital concerning charges of professional misconduct on her part relating to the administration of thrombolytics while she was working as an emergency room doctor.
[84] Ultimately, it was determined that she committed one act of professional misconduct and certain restrictions were placed on her. The decision of the College of Physicians and Surgeons was appealed and that appeal was ultimately dismissed on January 13, 2009.
[85] As a result of the rent dispute with the hospital, Roya was evicted from her office. Qasim accommodated her by allowing her to use his office three days a week and this continued until February 2008.
[86] In June 2008, Roya opened her own office and family practice at St. Elizabeth Village in Hamilton. In April 2010, Roya joined the Downtown Hamilton Family Health Organization (FHO). Roya was the lead physician. Roya continues as the lead physician and continues to work full time.
[87] I must confess that attempting to quantify Roya’s income for the years in question was the most difficult task facing the court. In large part, this difficulty was due to the respondent’s failure to provide timely disclosure and, secondly, because of the court’s lack of confidence in the information which was provided.
[88] At this juncture, I need not repeat the numerous requests and attempts to obtain basic financial information from the respondent concerning her personal income tax returns, her corporation’s financial affairs and disclosure of her banking records. For example, general ledgers were only produced at trial for the 2010 to 2012 years, long after the applicant’s expert had completed his report regarding her income. General ledgers for earlier years have never been received. As stated earlier, the respondent was furious when the Royal Bank, in accordance with an order for disclosure, provided particulars of accounts held in her name with the children. To compound the problems, even when information was provided, its accuracy was questioned. Income claimed on tax returns did not coincide with financial statements produced. The 2007 income tax return was allegedly amended, however, there is very strong evidence to suggest that return was never filed with Revenue Canada. Roya’s bookkeeping with respect to her FHO is very confusing. By the end of the trial, I had very serious concerns about the accuracy of Roya’s financial information before the court.
[89] Both parties retained experts to assist the court in making the determination of Roya’s income for child support purposes.
[90] Durward Jones Barkwell Chartered Accountants prepared their report, without having all of Roya’s necessary financial information. Their conclusion was that Roya’s income for support was as follows:
2007 $215,000.00
2008 $150,000.00
2009 $193,000.00
2010 $194,000.00
2011 $292,000.00
2012 $331,000.00
[91] Without all the supporting documentation, it is difficult to accept the accuracy of these numbers.
[92] Christine Larkin was retained to prepare a similar report. Her opinion was that Roya’s income available for support was as follows:
2007 $215,538.00
2008 $ 82,820.00
2009 $178,652.00
2010 $123,048.00
2011 $192,837.00
2012 $236,679.00
[93] Ms. Larkin relied heavily on Roya’s input, along with Roya’s financial information. I have already set out my concerns regarding the accuracy of this financial documentation and, therefore it makes it difficult to rely on Ms. Larkin’s conclusions.
[94] As pointed out in the submissions of Mr. Chaimovitz, there appears to be some very questionable, over-inflated expenses claimed by Roya in order to reduce her taxable income in each year. As well, there are suspicious unknown deposits into the children’s bank account which would have otherwise been income to Roya. Surprisingly, this was not disputed by Roya.
[95] In his written submissions, Mr. Bastedo, on behalf of Roya, has proposed that the court fix Roya’s income at $200,000.00, being an approximate average for the past three years.
[96] In my view, because of the missing information and inaccurate information, that is the minimum amount of income that should be imputed to Roya. I am very suspicious that in fact her income is significantly greater, however, on the basis of the information before me, and without a full forensic accounting, I am unable to determine a more accurate amount.
[97] With this determination, it might be appropriate that Qasim be responsible for 5/7 (five-sevenths) of allowable s. 7 expenses and Roya should be responsible for 2/7 (two-sevenths) of those expenses. However, to make this finding would in a sense reward the respondent for failure to properly disclose her income and assets. Roya’s conduct cannot be condoned by the court and, accordingly, it is appropriate in these circumstances that the parents equally share in s. 7 expenses.
[98] Again, it is very telling that the significant Guideline support paid by Qasim was obviously not needed by Roya as the money sat in a bank account until used for the purchase of real estate in 2013. More importantly, there is no suggestion whatsoever that during this same period of time the children’s lifestyle was affected in any way because of this.
[99] Both parents are medical doctors and earn good money. They are both able to contribute to any of the children’s s. 7 expenses.
[100] With respect to those s. 7 expenses, I agree with Qasim that Roya has not satisfied the court on a balance of probabilities that child care costs continue to be necessary for Saba. There is no evidence as to why or even when these expenses have or will be incurred.
[101] As well, there is evidence that these child care expenses for the nanny have been expensed through Roya’s corporation and deducted as an expense to her medical practice. Any room and board that she should have been receiving from the nanny has not been included in income.
[102] To avoid ongoing litigation between these parties as to what is or is not a s. 7 expenditure, I order that the parties pay 50% of the same s. 7 expenses ordered by Steinberg J. – that is, tuition, books, and school trips within the Province of Ontario. In addition, they shall share the cost of any medical or dental expenses incurred on behalf of the children. If the parties agree, additional s. 7 expenses may be shared between them.
(iii) Equalization of net family properties
[103] It is remarkable that seven years post-separation, these two parties are still warring over the contents of the matrimonial home, in particular, jewelry. During the course of the trial, counsel and the parties were advised that the court, without proper valuations or appraisals, was not in a position to pull numbers out of the air, and if the parties were unable to prove the value of specific items, the only recourse open to the court would be to order that all items be sold and the proceeds divided between the parties, or exclude the items from any calculation of net family property.
[104] The court has received no proper valuations from either party regarding any household items, vehicles or jewelry.
[105] In his closing submissions, the applicant has conceded this lack of evidence and has asked that household items be removed from any equalization calculation.
[106] In her submissions, Roya agrees with this position as long as there is a return of certain items which she alleges are excluded property in any event.
[107] The provisions of the Family Law Act provide for an equalization payment from one spouse to another. The court does not divide assets, unless there is an agreement between the parties. As stated earlier, without proper valuations which can be included in a spouse’s net family property, the court will not divide assets in specie.
[108] At this juncture, the court cannot even order a sale of household contents as I have no specific evidence as to what, if any, of the contents remain in existence today.
[109] In all of these circumstances, I have removed household contents from my determination of the proper equalization payment.
[110] The court heard much evidence regarding jewelry and who has it. The applicant alleges that the respondent took most of it. The respondent alleges that the applicant has much of the jewelry.
[111] The undisputed facts are that the parties had two safety deposit boxes at the Royal Bank where the jewelry was kept. On March 18, 2008, Qasim attended the bank and opened the safety deposit boxes in the presence of Cheryl Mochrie, who testified that Qasim was very surprised to find both boxes completely empty. According to the signature cards kept by the bank, the individual who had last access to these safety deposit boxes was Roya.
[112] The date of that last attendance was August 9, 2007.
[113] It is also undisputed that sometime in July 2007, the parties purchased a safe from Costco which was to be kept at the family home. This safe had a lock and combination.
[114] When Qasim left the home on March 20, 2008, he took the safe with him. He delivered the safe to the offices of his former solicitor, Mr. Keesmat. He was unable to open the safe as he testified he did not have the key to the safe.
[115] The safe was ultimately opened in December 2008 in Mr. Keesmat’s office in the presence of both parties. An inventory was taken of the contents of the safe and there were 135 pieces of jewelry which were photographed and documented. At that time, the respondent was permitted to take a number of pieces of jewelry on the condition that she would have those pieces appraised. To date, no such appraisal has been obtained.
[116] The safe remained in Mr. Keesmat’s office. At the time of the first trial, the applicant agreed to give the contents of the safe to the respondent. The jewelry was delivered by courier to Roya’s previous solicitor, Mr. Schneiderman.
[117] Roya testified that from the date that the safe was opened in Mr. Keesmat’s office in 2008 until the contents were delivered to Mr. Schneiderman’s office, further pieces of jewelry went missing. The clear allegation is that Qasim took those items.
[118] Qasim’s evidence is that he never saw the jewelry after the safe was opened in Mr. Keesmat’s office and most troubling for him is the apparent disappearance of a family heirloom necklace which belonged to his mother.
[119] I find Roya’s suggestion that jewelry went missing between the time the safe was opened at Mr. Keesmat’s office until it was delivered to her solicitor’s office outrageous. It is of note that this allegation was first made when Roya believed that the jewelry had been delivered by Qasim. Mr. Keesmat is a well-respected solicitor and, certainly, if there is any suggestion that he was responsible for this so-called missing jewelry, such a serious allegation would require notice to Mr. Keesmat. If there is a suggestion that the courier company somehow misappropriated any of the jewelry, again, that is an allegation that would have required the involvement of the police at minimum. For these reasons, I reject Roya’s suggestions.
[120] I also find her failure to provide an appraisal of the items she removed from Mr. Keesmat’s office very telling in all of the circumstances. This, in combination with the fact that Roya was the last person to have access to the jewelry from the Royal Bank safety deposit boxes, leads me to the conclusion that whatever jewelry there is, is in Roya’s possession.
[121] However, even with this finding, the court is not in a position to ascribe a value to this jewelry without proper evidence.
[122] There is credible evidence that Roya did have certain pieces of jewelry prior to the date of marriage. Those items would, pursuant to the Family Law Act, be excluded property.
[123] Roya has claimed $50,000.00 for the value of jewelry owned on the date of marriage. In my view, it would be unconscionable to permit her this deduction without including an equal amount for the value of jewelry she had in her possession as of the date of separation. For this reason, although I have no credible evidence as to the actual jewelry and its value in Roya’s possession, I am disallowing any claim by her for the value of jewelry she claims to have had on the date of marriage.
[124] With respect to land, pursuant to the order of Pazaratz J. dated August 27, 2013, Roya purchased the matrimonial home, at 136 Joshua Avenue, in Ancaster, from Qasim for the sum of $609,000.00 and paid to him one-half of this amount, namely, $304,500.00.
[125] Pursuant to that same order, Roya also purchased Qasim’s interest in the property located at 582 Carluke Road, in Ancaster, Ontario, for the sum of $751,000.00. Roya paid the applicant $375,500.00 for his interest in that property.
[126] Adjustments relating to both of these properties remained outstanding for determination at trial. I will deal with those adjustments shortly.
[127] With respect to bank accounts and savings, the two items the parties do not agree on are the monies Qasim alleges Roya has in unknown bank accounts in Iran and trust monies held by a former solicitor.
[128] With respect to the Iranian bank accounts, Qasim’s evidence is that he and Roya invested $400,000.00 with Roya’s father. This investment related to a quarry in Iran. This money was to bear interest at the rate of 20% per year. At Exhibit 11, Qasim went through three separate calculations in order to establish the value of this investment. Qasim testified that the principal with accrued interest, by the end of April 2005, was $675,000.00. At that time, Roya received $397,000.00 from her mother in April 2005 leaving a balance of $278,000.00 owing on the investment. By the end of September 2007, the date of separation, the principal amount of the investment with accrued interest at 20% was $433,000.00.
[129] In addition to these monies, Roya loaned her sister, Zahra, $80,000.00 in May 2002. With interest of $10,000.00, this loan amounted to an additional $90,000.00 which was also invested in Roya’s father’s corporation in May 2003. At 20% interest, by the end of 2007, this investment had a value of $187,000.00.
[130] Lastly, on July 14, 2006, Roya transferred $250,000.00 to Iran. By the end of July 2007, that principal amount, with interest, was equal to $310,000.00.
[131] Therefore, according to Qasim’s evidence, by the end of September 2007, $930,000.00 Canadian dollars were owed to Roya.
[132] Roya disputes that these monies exist. Instead, she testified that she was opposed to any monies being invested in her father’s company, but Qasim insisted and, unfortunately, those funds were lost when her father’s business fell into economic difficulties. There is no money in Iran or anywhere else.
[133] This was a joint investment. If at any time in the future, monies are repaid on the investment, they will be shared equally between Roya and Qasim.
[134] Qasim’s calculations are mere speculation on his part. He somehow has co-mingled their initial investment with her father’s company with monies owed to her from her sister and her brother.
[135] Roya testified that she did receive some $399,000.00 from her mother in May 2005. This money represented $90,000.00 from her sister, Zahra, to repay Roya for money she had loaned her sister in 2002 in order to purchase a house, plus $10,000.00 interest.
[136] $310,000.00 was provided by her brother, Hamid, for immigration purposes. The monies were deposited into Roya’s RBC Investment account and remained there until they were repaid to her brother in or about May 2010.
[137] Roya acknowledges that in 2006, she did bring $250,000.00 to Iran. She said these monies were not for investment but were used to pay wages for employees of the father’s company when he was unable to meet that obligation.
[138] After considering all of the evidence, I am not satisfied that Qasim has established, on a balance of probabilities, that these investment monies still existed as of the date of separation.
[139] Roya’s explanation with respect to the $399,000.00 she received from her mother in May 2005 is unbelievable. It makes no sense whatsoever that her brother was so busy that he would be unable to go to a bank and transfer funds to her directly. Nor did her explanation about his immigration plans make any sense. Depositing monies in her account would seem to be of little assistance to anybody attempting to establish that they had assets available to them. Having said this, however, I am unable to determine with any certainty what this $399,000.00 was for. Zahra testified and I have no reason to disbelieve her evidence in this regard that $90,000.00 of the money represented a repayment of monies that were loaned to her. That in and of itself still does not in any way assist the applicant in establishing that the monies were a return on this joint investment from her father’s company.
[140] All of these transactions are very suspicious, however, that is not sufficient to satisfy the court that an Iranian bank accounts exists. I concur with the submissions of Mr. Bastedo that Qasim’s calculations are mere speculation on his part.
[141] With respect to monies held in her solicitor’s trust account as of the date of separation, it would appear, after reading the reply submissions provided by Mr. Chaimovitz, that Qasim has conceded that the trust fund balance to the credit of the respondent on the date of separation was $9,123.34.
[142] The next major area of disagreement between the parties regarding property values is the business interests of their medical practices.
[143] Qasim’s evidence is that the value of his medical professional corporation, of which he is a 100% shareholder, is equal to the monies that he had in each of his accounts as of the date of separation. Those total $441,300.82. The amount of money in Roya’s medical professional corporation as of the date of separation was $86,329.24. In each case, it is Qasim’s evidence that these accounts should be reduced to reflect a contingent tax liability of 31%.
[144] Roya’s evidence, relying on a valuation report prepared by Christine Larkin fixes the value of Qasim’s professional corporation at $757,428.00. This amount should be reduced by the tax liability which would be paid on dividends, calculated at 31% ($234,803.00). Ms. Larkin provided the present value of that tax liability as $167,019.00, resulting in a fair market value of Qasim’s corporation at $590,000.00.
[145] Roya’s original position was that her 100% interest in her professional corporation was zero. However, after receiving the written submissions of Mr. Bastedo, it is conceded that Roya had $86,329.24 in the corporation at the date of separation. Roya asks that this amount be reduced by 46% as she receives her income by way of salary from the corporation instead of by dividends.
[146] The biggest difference in the value of Qasim’s corporation is whether or not the Argyle Street property should be included as an asset of Qasim’s corporation.
[147] In October 2004, Qasim provided Roya with $265,000.00 which he took from his corporation for the purchase of the property located at 289 Argyle Street, Hagersville, Ontario. It was his understanding that this property was to be a joint investment for the two of them and might ultimately be used for a medical clinic. He understood he would be an owner of the property. Instead, the monies were deposited into Roya’s personal account and she incorporated a company, 1631035 Ontario Inc., to purchase the property. Roya is the sole shareholder of 1631035 Ontario Inc. and this limited numbered company owns title to the Argyle Street property. Pursuant to the order of Justice Festeryga, this property is to be sold and the proceeds, subject to adjustments, are to be divided equally between the parties.
[148] Believing that he was an owner of the property, Qasim showed this property as an asset of his professional corporation. To correct this error, he has been advised that it may be necessary for him to declare a dividend in the amount of $265,000.00 to reflect the money that he removed from the corporation.
[149] Ms. Larkin, in her report, has included $250,000.00 as a short term investment owned by Qasim’s professional corporation. She also indicated it could be considered a loan from Qasim’s corporation to Roya and her corporation and that loan is an asset which will be repaid when the property is sold.
[150] In my view, it is clear that both professional corporations are mere holding companies. The value of the companies are the assets they owned on the date of separation. Unfortunately for reasons not adequately explained, Roya chose to incorporate a company in which she was the only shareholder to purchase the property on Argyle Street, using the money given to her by Qasim. In the end, Qasim’s company does not own that property. The money was not lent to Roya. There is no loan documentation to support a loan. To correct this problem, Qasim will need to remove this asset from the corporation and that will likely be done by declaring a dividend. He will be subject to income tax of 31% on any dividend that he declares.
[151] In these circumstances, it seems unreasonable to include the value of the Argyle property in the value of his professional corporation. I am satisfied that the more equitable approach with respect to both professional corporations is to value them on the basis of the money on deposit to the credit of each corporation on the date of separation. To remove these monies from the corporation, each of Qasim and Roya will be subject to personal tax. Ms. Larkin testified that the appropriate tax rate on dividends is 31%. Roya has asked that her cash assets be reduced by a higher personal rate of tax, 46%, on the basis that she will remove the income by way of salary and not dividends. The difficulty with this proposition is I have little confidence in the income tax returns filed by Roya. I do not have sufficient evidence that in fact her personal rate of tax is 46%. Nor am I confident that the money from her corporation will be paid to her in a form other than through dividends.
[152] In order to be consistent with how these professional corporations are treated, I am satisfied that the value of the assets held in the corporation will be reduced by the personal tax rate on dividends in the amount of 31%. Accordingly, I find the value of Qasim’s professional corporation to be $441,300.82. The contingent tax on that asset is $132,803.25. I find the value of Roya’s professional corporation to be $86,329.24 and the contingent tax on that asset is $26,762.06.
[153] With respect to debt and liabilities on valuation date, I have already determined the applicable contingent tax liability relating to the parties’ professional corporations. In addition, Qasim disputes the outstanding debts that Roya claims were owed to her brother and sister. Finally, Qasim disagrees with the amounts Roya claims were owed in legal fees and accounting fees as of the date of separation.
[154] With respect to the money Roya claims she owed both her brother and sister, I reject her evidence as unbelievable and, accordingly, those debts will not be included in her net family property statement. Firstly, I have already indicted that her explanation about why any money she received from her brother would be paid to her through her mother, made no sense. She testified that he was a wealthy businessman and he was too busy to go to the bank and so he gave it to his mother instead. Further, her explanation that this money was somehow necessary to assist him in his immigration process made no sense. In support of her claim, she attempted to show a letter which was dated several years after she received the money in the first instance. There is no loan documentation. There is nothing in writing. There is nothing signed by either she or her brother. Very telling, her brother was not called to testify at trial. Her mother and sister were present and did testify and there was no explanation given as to why the brother would not be able to testify at trial. In these circumstances, an adverse inference is drawn that her brother would not support Roya’s version of these events.
[155] The same is true of the debt Roya alleges is owed to her sister, Jilla. Once again, Jilla did not testify. There was no explanation given why that wasn’t possible. Roya testified that her sister, Jilla, lived in Toronto. Of significant concern to the court is the ever-changing value placed on this alleged loan from her sister by Roya herself. As Mr. Chaimovitz pointed out in his submissions, Roya filed several different financial statements wherein the amount of the debt changed in ever-increasing amounts. Her first financial statement listed the debt at $5,000.00 and her most recent financial statement had that amount inflated to $20,000.00. Her explanation as to why the value changed is not believable. Once again, there is no written documentation of the loan and, in these circumstances, it will not be allowed.
[156] Regarding accounting fees, in her written submissions, Roya has conceded that those fees to Mr. Caparrotta were paid prior to the date of separation. With respect to the legal fees allegedly owed to Mr. Pape, as set out earlier in these reasons, the parties appear to now agree that as of the date of separation, there was some $9,123.34 remaining in trust. There was no outstanding legal bill to Mr. Pape at the date of separation.
[157] At the date of separation, the respondent owed the College of Physicians and Surgeons the sum of $9,765.00 as a result of the discipline action taken against her. Although Roya concedes that that is the amount as of the date of separation, she asks that the full amount of her indebtedness to the College be included. Her decision to appeal the determination of the tribunal was made prior to the date of separation and she should be allowed a deduction for the fees that she incurred after the separation.
[158] In Greenglass v. Greenglass, 2010 ONCA 675, the Ontario Court of Appeal considered when the court would permit a foreseeable liability for legal fees to be deducted even when those fees are incurred after the date of separation.
[159] In my view, Roya’s continued appeal of this decision was not warranted. I accept the evidence of Qasim who indicated that the matter could have been resolved much more quickly if Roya simply would have taken the course that was recommended to her. Instead, as a matter of principle, she continued with the litigation without any evidence that there was a likelihood of success on the appeal. In these circumstances, I am not prepared to permit the additional legal fees. The amount owing as of the date of separation was $9,765.00.
[160] I now turn to the assets owned on the date of marriage. Once again, the court was not provided any proper documentation regarding the values claimed by either party. I am not prepared to permit Qasim any deduction for assets he claimed he owned on the date of marriage. With respect to the assets claimed by Roya, I have already determined that although she had certain jewelry, I am not permitting the deduction for the reasons already set out in this decision.
[161] Roya has provided verification that on September 13, 1991, prior to the date of marriage, her father deposited £20,000 (Pounds Sterling) in her U.K. account. £20,000 equates to $45,077.93 which the respondent claims she had on the date of marriage.
[162] Qasim’s position is that this money, according to the evidence Roya gave at the time of her discovery, was loaned to her from her father and some monies were returned to her after the date of marriage. In these circumstances, Roya should not be given credit for the money in this account.
[163] The onus is on the respondent to prove this deduction. Irrespective of the concern that these monies might be a loan, not a gift, the court has no information as to what amount of these monies existed on the date of separation. Roya provided a copy of a bank book showing that the funds existed prior to the date of marriage. However, there is no evidence that they existed on the date of marriage. For some reason, Roya has failed to provide the court with the next page of her bank statement showing what, if any, funds existed on the date of separation. In these circumstances, I am not prepared to allow the deduction.
[164] With these findings, I now reproduce the net family property statements and calculation of the equalization claim.
Table 1: Value of Assets Owned on Valuation Date
Nature & Type of Ownership
Address of Property
Applicant
Respondent
Matrimonial Home*
113 acres – joint*
*Still subject to post separation adjustments
136 Joshua Ave., Ancaster, ON. (Respondent has purchased the Applicant’s interest in the home for $609,000.00 and the Applicant has received his half in accordance with the order of Justice Festeryga dated January 14, 2011.
582 Carluke Rd., Ancaster, ON. (Respondent has purchased the Applicant’s interest in the home for $751,000.00 and the Applicant has received his half in accordance with the order of Justice Festeryga dated January 14, 2011.
Totals: Value of Land
$0.00
$0.00
General Household Items and Vehicles
Item
Description
Applicant
Respondent
Household goods & furniture;
Cars, boats, vehicles;
Jewelry, art, electronics, tools, sports & hobby, equipment
Not included for reasons given
Totals: Value of General Household Items and Vehicles
$0.00
$0.00
Bank Accounts and Savings, Securities and Pensions
Category
Institution & Account Number
Applicant
Respondent
Account
Account
Account
US Account
RSP
Account
Stocks
RRSP
Account
Investment Account
US Account
RSP
RBC #5002522
RBC #7009616
RBC #5039755 - had joint with Mariam Yar until June 2007 when the account became the Applicant’s sole account.
RBC #4500633 - in USD funds
RBC #545894305 @ December 31, 2007
ING Direct
E-trade
MD Management
RBC #5014329
RBC #543533129
RBC #4515193
RBC #06844052
Money held in trust by Pape law firm
$12,690.91
$7.58
$5.78
$1,731.77
$35,989.29
$5.58
$25,874.61
$161,712.00
$28,286.02
$333,706.41
$4,525.16
$164,133.53
$9,123.34
Totals: Value of Accounts and Savings
$238,017.52
$539.774.46
Business Interests
Name of Firm/Company
Interests
Applicant
Respondent
Qasim Yar Medicine Professional Corporation
1631035 Ontario Inc.
Roya Yar Medicine Professional Corporation
100% Shareholder
Account 1004589
Account 00110113696-002 (USD)
Account001401123669-001(USD)
Dealt with by order of Justice Festeryga dated January 14, 2011
Amount in bank account of corporation at separation
$93,059.48
$226,591.71
$121,649.63
$86,329.24
Totals: Value of Business Interests
$441,300.82
$86,329.24
Total 1: Value of Property Owned on the Valuation Date
$679,318.34
$626,103.70
Table 2: Value of Debts and Liabilities on Valuation Date Debts and Other Liabilities
Category
Details
Applicant
Respondent
Taxes owed by Qasim Yar Professional Corporation
Applicant to declare a dividend of $265,000 to get Argyle property removed from company. Tax at dividend rate 31%
$82,150.00
Notional Contingent Tax
On parties RSP’s at 40%*
*as agreed by the parties
$79,060.52
$65,653.00
CPSO
Discipline hearing
$9,765.00
Unpaid GST
CRA
$108.00
Unpaid Income tax
CRA
$31,939.38
Credit Card
Visa Platinum
$51.81
Credit Card
RBC Gold
$60.21
Contingent tax liability
On funds in parties professional corporations (at dividend tax rate of 31%)
$136,803.25
$26,762.06
Total 2: Debts&Liabilities
$298,013.77
$134,339.46
Table 3: Net Value on Date of Marriage of Property Property, Debts and Other Liabilities on Date of Marriage
Category
Details
Applicant
Respondent
Bank accounts and savings
$0.00
$0.00
Total 3: Net Value of Property Owned on Date of Marriage
$0.00
Value of Property Owned on Valuation Date
$679,318.34
$671,181.63
Minus Debts and Liabilities
($298,013.77)
($134,339.46)
Net Family Property
$381,304.57
$491,764.24
EQUALIZATION PAYMENTS
Applicant Pays Respondent
$0.00
Respondent Pays Applicant
$55,229.83
[165] I order that the respondent pay to the applicant an equalization payment of $55,229.83.
Post Separation Adjustments
[166] I have accepted the submissions of Mr. Bastedo and the respondent that it is more appropriate for any post separation adjustments relating to the Argyle Street property be completed when that property sells. If the parties are unable to agree on what those post separation expenses are, it may be dealt with by way of motion to the court.
[167] I will deal with post separation adjustments as they relate to both the Joshua and Carluke properties.
Joshua Property
[168] The parties agree that the applicant has expensed $141,562.00 for mortgage fees and $15,249.00 for property taxes.
[169] Roya disputes legal fees claims that were incurred by Qasim in the amount of $33,000.00.
[170] Qasim testified that he was sued by the contractor post separation. For some reason, Roya was never joined in the claim, despite being a joint owner. The law suit related to work done on the house when the parties were still together. In my view, these are expenses that the joint owners should equally be responsible for. I am including this $33,000.00 amount in Qasim’s post separation payments.
[171] The parties agree that Roya paid property taxes totaling $34,726.98 and insurance for $9,202.68.
[172] Qasim disputes the Roya’s claims for maintenance and repairs, fence, estimate for repairs and legal fees.
[173] Roya was in possession of the home after March 2008. She continued to reside there with the children. Ultimately, in 2013, she purchased the home from Qasim.
[174] In these circumstances, general maintenance and upkeep would and should have been her responsibility as she resided in the home. More importantly, when the parties arrived at a purchase price in 2013, Roya would have been well aware of the condition of the property and knew what she was purchasing. It can only be assumed that the agreed upon purchase price reflected the condition of the home. The legal bill in question relates to the purchase of the home and should be the sole responsibility of Roya who acquired the property in 2013.
[175] Roya owes Qasim $72,940.67 calculated as follows:
Paid by Qasim Paid by Roya
$141,562 $34,726.98
$ 15,249 $ 9,202.68
$ 33,000
$189,811 $43,929.66
Each party should pay $116,870.33
Roya owes Qasim $72,940.67
Carluke Property
[176] It is agreed that Qasim spent $23,888.00 on property taxes and received $2,000.00 in rent.
[177] The parties also agree that Roya paid property taxes of $35,937.92.
[178] There was some disagreement with respect to legal fees, fence, and repairs that Roya claimed. Roya does not have receipts for the fence and repairs and has conceded that it would not be appropriate for Qasim to contribute to these costs without the receipts. She did produce a receipt for legal fees of $1,017.11, however, once again, these legal fees refer to her purchase of the property from Qasim and, as I indicated earlier with respect to the Joshua property, in my view, those expenses are properly paid for by Roya.
[179] The only other area of disagreement with respect to Carluke relates to the amount of rent Roya received on that property, which will reduce her contribution to the expense. Qasim testified that she received $26,000.00 in rent. Roya testified the amount was $20,000.00 as claimed on her income tax return. I do not have any other evidence as to what the actual amount of rent was. The amount of rent received would necessarily be reduced by applicable expenses on the property. Without evidence to the contrary, I have accepted Roya’s calculation that the net rent she received was $10,800.00.
[180] Qasim owes Roya $1,624.96 calculated as follows:
Paid by Qasim Paid by Roya
$23,888 $35,937.92
($2,000) ($10,800.00)
$21,888 $25,137.92
Each party should pay $23,512.96
Qasim owes Roya $1,624.96
[181] The net result is that Roya owes Qasim $71,315.71 for post separation adjustments for the Joshua and Carluke properties.
(iv) Spousal support
[182] The final issue for the court to determine is whether or not Qasim should pay any retroactive or ongoing spousal support to Roya.
[183] The position of Qasim is that Roya is financially self-sufficient and is not in need of any spousal support. She has not demonstrated any need, nor any economic disadvantage which arose from the marriage.
[184] The position of Roya is that she has done what she could to earn as much income as possible and at the same time look after the children and deal with many obstacles including her health difficulties. Roya bases her claim largely on a compensatory basis for support and argues that there has not been an equitable distribution between the parties of the economic consequences of the marriage. In addition, she claims need, particularly with respect to her eviction from the West Haldimand General Hospital and ongoing costs of this litigation.
[185] The threshold issue for determining spousal support is entitlement. The relevant factors are found in s. 15(2)(4) of the Divorce Act. It is well-established that there are three grounds for entitlement to spousal support: compensatory support, non-compensatory support and contractual support. (Bracklow v. Bracklow, 1999 CanLII 715 (SCC), [1999] 1 SCR 420)
[186] Roya’s claim must fall under one of these three categories for her to be entitled to receive spousal support from Qasim.
[187] Having found that the Mahr is not enforceable as a marriage contract, there is no contractual basis for support.
[188] I now turn to the principles of compensation or economic disadvantage. Did Roya suffer any economic disadvantage as a result of the marriage? In my view, nothing in this marriage seriously interrupted or impeded Roya’s career or earning capacity. The court heard that Qasim was very supportive of his wife’s interest and desire to be a medical doctor. Although she dreamed of being an ophthalmologist, circumstances were such that that did not come to pass. However, on the basis of the evidence before me, I am not satisfied that her failure to become an ophthalmologist had anything to do with Qasim or their marriage.
[189] Obviously, when Roya had the two children of the marriage, she had to stop or hold off on her medical training to become a family physician. However, the evidence is that Roya always had assistance with the children. Qasim’s mother and his sister assisted, as well as her mother, and the parties employed a nanny for the majority of the time. The court heard that Sanam went to Iran with her grandmother for several months to permit Roya to continue with her studies.
[190] This is not the situation one often encounters in a traditional arrangement where a spouse remains at home or cares for the children or works in order to provide the other parent the ability to obtain further education. I find that Roya has no diminished earning capacity as a result of her role in the marriage or the care of the children.
[191] Certainly, Roya has had some health issues, however, no evidence was led regarding any significant serious health issue that would prevent her from continuing to practice as a family physician. Since 2001, she has been steadily employed.
[192] Just because Qasim earns more money than her does not mean that she is entitled to support or that she has suffered some economic disadvantage.
[193] Once again, Roya’s failure to be completely candid with the court regarding her income also puts her at a disadvantage. I have already stated that I suspect that her income is higher than what has been presented at trial.
[194] If support is not awarded on a “compensatory” basis, the court must then look at the needs of the spouse requesting support and the ability of the other spouse to contribute to that support. Qasim earns more money than Roya does. Still, at minimum, Roya has income of $200,000.00 per year. Once again, her failure to provide full and frank financial disclosure makes it difficult for the court to determine whether she has any additional need for funds. The fact that Roya did not use the significant child support she was receiving also is clear evidence that she was able to support the children and herself on her income. There is no evidence whatsoever of any diminished lifestyle or that she and the children somehow were living at a reduced standard of living or for that matter that Qasim had an extravagant lifestyle.
[195] Even after paying the equalization as ordered, Roya has net assets in excess of $400,000.00. This does not include Joshua Street, Carluke or the Argyle Street property. She continues to be the physician in charge of her FHO. There is no evidence to suggest that her arrangement at St. Elizabeth is anything but permanent or that for some reason the number of her patients has decreased. The report of her own expert shows that her income has steadily increased over the past three years.
[196] There is no evidence to suggest that either party is living or enjoying a lifestyle better than they had during the course of their marriage.
[197] The respondent’s claim for retroactive and ongoing spousal support is dismissed.
Order
[198] Order to go as follows:
The respondent’s claim for enforcement of the Mahr is dismissed.
The applicant shall pay to the respondent child support for the children, Sanam Yar, born April 7, 1994, and Saba Yar, born November 19, 1998, in the amount of $6,002.00 per month commencing September 1, 2014 and payable on the 1st day of each month based on the applicant’s 2013 imputed income of $500,000.00 and in accordance with the Child Support Guidelines.
The applicant and respondent shall share equally the cost of tuition, books, school trips within the Province of Ontario, medical and dental expenses for the children. The parties may consent to other s. 7 expenses. Section 7 expenses shall be agreed to by email exchanged between the parties. Monies shall not be expended on s. 7 expenses prior to consent being obtained unless an emergency situation.
The respondent’s claim for a retroactive variation and/or adjustment to child support and s. 7 expenses shall be dismissed.
The respondent shall pay to the applicant an equalization payment in the amount of $55,229.83.
The respondent shall pay to the applicant the sum of $71,315.71 to adjust for post separation payments made by the parties in accordance with the order of Festeryga J. dated January 14, 2011.
The respondent’s claim for retroactive and ongoing spousal support shall be dismissed.
The parties shall exchange personal income tax returns including copies of all attachments, notices of assessment or reassessment by June 30 of each year, commencing in 2015.
The parties shall exchange their corporate tax returns including all attachments, notices of assessment or reassessment by June 30 of each year, commencing in 2015.
The Carluke property shall continue to be listed for sale and proceeds divided in accordance with the order of Festeryga J. dated January 14, 2011.
SDO to issue.
Costs
[199] If the issue of costs cannot be resolved, I direct that the party seeking costs shall deliver written submissions to my chambers, at 59 Church Street, 4th Floor, St. Catharines, L2R 7N8, within 10 days of the release of this judgment with responding submissions to be delivered to my office within 10 days thereafter. The written submissions are not to exceed three typewritten, double-spaced pages, excluding the Bill of Costs and Costs Outline. If no submissions are received within this timeframe, the parties will be deemed to have settled the issue of costs as between themselves.
Walters J.
Released: January 19, 2015
CITATION: Yar v. Yar, 2015 ONSC 151
HAMILTON COURT FILE NO.: D705/08
DATE: 2015/01/19
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
QASIM ABRAHAM YAR
Applicant
- and -
ROYA FATEMEH YAR
Respondent
REASONS FOR JUDGMENT
Walters J.
Released: January 19, 2015
CITATION: Yar v. Yar, 2015 ONSC 151
HAMILTON COURT FILE NO.: D705/08
DATE: 2015/02/05
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
QASIM ABRAHAM YAR
Jerry J. Chaimovitz, for the Applicant
Applicant
- and -
ROYA FATEMEH YAR
Thomas G. Bastedo and Jennifer Swan, for the Respondent
Respondent
HEARD at Hamilton: June 9, 10, 11, 12, 13, 16, 17, 18, 19, 20, 23, 24, 25, 26, July 7 & 8, 2014
The Honourable Madam Justice L.M. Walters
ADDENDUM TO REASONS FOR JUDGMENT
[200] After release of my Reasons for Judgment on January 19, 2015, it came to my attention that I may have misinterpreted Qasim's position regarding ongoing child support.
[201] Paragraphs 75 and 76 of my Reasons make it perfectly clear that I did not have sufficient information to make an appropriate determination of child support, other than the Guideline amount. Irrespective of the submissions of either party, I determined that support would be paid in accordance with the Guidelines. I did not include any residence fees, or apartment costs in section 7 expenses for this very reason.
[202] There will be no amendment to my Reasons.
Walters J.
Released: February 5, 2015
CITATION: Yar v. Yar, 2015 ONSC 151
HAMILTON COURT FILE NO.: D705/08
DATE: 2015/02/05
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
QASIM ABRAHAM YAR
Applicant
- and -
ROYA FATEMEH YAR
Respondent
ADDENDUM TO REASONS FOR JUDGMENT
Walters J.
Released: February 5, 2015