Slongo v. Slongo, 2015 ONSC 2093
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Mrs. Louise Slongo Applicant
– and –
Mr. Christopher Ronald Slongo Respondent
Paul Buttigieg, for the Applicant
Herschel Fogelman and Oren Weinberg, for the Respondent
HEARD: October 21, 2014 and October 22, 2014, February 13, 2105
REASONS FOR JUDGEMENT
Lemon, J.
THE ISSUES
1Mr. Slongo has retired earlier than expected. He has received a pension payout and a new consulting job that has raised his income. As a result, Ms. Slongo has brought a motion to vary the child and spousal support upon which they agreed and have made into a court order. Mr. Slongo says that there has been no change in circumstances that should allow for such a variation. He submits that his obligation to pay child support has come to an end.
2Cross-examinations were held on the affidavits but neither party wished a trial on viva voce evidence other than the one witness that was called with respect to the valuation of Mr. Slongo’s pension. I have not been able to make findings of credibility on these materials. I have therefore often taken the factual history directly from each party’s factums or affidavits.
3The issues for me to decide are:
- Is Mr. Slongo still required to pay child support for their daughter?
- Has Mr. Slongo’s early retirement brought about a material change in circumstances that will allow for a variation of the order and agreement?
- To what extent has Mr. Slongo’s early pension payout already been equalized in their earlier order and agreement?
- If Ms. Slongo’s spousal support is to be varied, to what extent should I rely on the Spousal Support Advisory Guidelines?
- If a variation is appropriate, to what extent should Ms. Slongo’s spousal support be varied?
4I reserved my judgment at the end of argument on October 22, 2014. I was able to resolve a number of issues but required further assistance from counsel.
5One of the ways that I could have resolved my concerns was to direct a trial of an issue (See Rule 15 (26)). For the benefit of the parties, I wanted to avoid that time and expense. I therefore sought further assistance from counsel. They spoke with me on February 13, 2015. I will deal with those submissions as they arise in this judgement.
BACKGROUND
6The parties were married on October 13, 1984, and separated on September 23, 2007. There are 3 children of the marriage although only Jennifer, born January 21, 1992 (age 23) is argued to be a dependent still.
7At the time of the marriage breakdown, Ms. Slongo was 46 years old, Mr. Slongo was 48 and the parties had been married for 23 years.
8On June 24, 2008, the parties resolved their issues by executing a separation agreement.
9In 2009, Ms. Slongo commenced a proceeding to seek increased spousal support from Mr. Slongo. Mr. Slongo agreed to pay additional spousal support based on his increased income, and the terms of the agreement. Minutes of Settlement were filed and Justice Daley signed an order on September 15, 2009 that required Mr. Slongo to pay higher child and spousal support.
10In 2011, the parties agreed to a further change. A consent was filed and the order was amended by me on November 28, 2011. Mr. Slongo continued to pay Ms. Slongo $2,000.00 per month in spousal support (as per the Agreement), plus $150.00 per month for extended medical plan benefits that was ordered by Daley J. along with a further sum of $500.00 per month in spousal support. Under those combined orders, Mr. Slongo now pays $2,650.00 per month in spousal support. It is these orders that Ms. Slongo seeks to change.
11Both of the orders confirmed that the separation agreement otherwise remained valid and enforceable. I will refer to the terms of the agreement and orders under each of the relevant topics below.
1. Is Mr. Slongo still required to pay child support for their daughter?
i) Background
12Ms. Slongo submits that Jennifer is still a dependent and that Mr. Slongo should continue to pay for Jennifer’s ongoing education expenses. Mr. Slongo denies this.
13The parties’ agreement, confirmed by the orders, sets out the following relevant terms as they relate to child support (I have bolded the terms with particular import):
The Husband’s obligation to pay child support to the Wife will survive his death and be a first charge against his estate provided the Child(ren) is/are entitled to support pursuant to this clause. The parties agree that the Husband’s obligation to pay child support to the Wife shall continue until one of the following occurs with respect to any of the Children:
The Child ceases to reside full-time with the Wife. “Reside full time” includes the Child living away from home to attend an educational institution, or pursue summer employment, or obtain medical treatment, or take a vacation, providing the Child is otherwise maintaining a residence with the Wife;
The Child becomes 18 years of age and ceases to be in full-time attendance (except for school vacations) at an educational institution;
The Child obtains one post-secondary educational degree or diploma or turns 23 years of age, whichever occurs first. In the event that the Child turns 23 years of age and has not yet completed her undergraduate degree or diploma, then the child support shall continue until the end of that year, provided that the Child is carrying a full course load;
The Child marries;
The Husband dies, provided that the security in the section of this Agreement entitled “Life Insurance” is in place at the time of death;
The Child dies; or
The Child ceases to be a “child of the marriage” as defined in the Divorce Act or the Guidelines.
14At the present time, Jennifer is 23 years old. In May of 2013, she completed a 2-year college-level certificate program at Sheridan College in early childhood education. Accordingly, says Ms. Slongo, Jennifer has not earned a diploma or a degree from any post-secondary educational institution in Canada as set out in the agreement. She says that a certificate is not a diploma or degree.
15Although Jennifer did not complete her certificate program until May of 2013, Mr. Slongo stopped paying Table child support, effective December 1, 2012. Jennifer was supposed to have completed her ECE certificate program in January of 2013, but she needed to re-take one course that she had failed. She continued on with that one course in 2013. It appears that Mr. Slongo relied on the fact that Jennifer was no longer “in full time attendance at an educational institution.” It appears that he was correct.
16In the fall of 2012, Jennifer told Ms. Slongo that she was changing her career focus and was no longer leaning towards teaching and/or operating her own daycare facility. Jennifer had become aware of the difficulty her eldest sister was having in securing a teaching position. She therefore decided to continue with her studies after obtaining the certificate in May of 2013.
17Mr. Slongo fully supported Jennifer’s initial intention of entering the bridging program offered by Sheridan College after she completed her ECE program, which would have resulted in Jennifer earning a university degree in early childhood education.
18However, in September 2013, Jennifer commenced a 3-year diploma program in Equine Studies offered by the University of Guelph. Jennifer’s current post-secondary program is alleged to cost approximately $2,100.00 per year for tuition. Ms. Slongo sets out that Jennifer’s course work consumes approximately 25-30 hours per week.
19Ms. Slongo deposes that Jennifer is not currently employed and is fully reliant upon Ms. Slongo for her support. Jennifer previously worked as a retail clerk earning minimum wage. Ms. Slongo says that she requires Jennifer to drive her to and from her place of work and various medical appointments on an ongoing basis, as Ms. Slongo cannot afford taxis, and public transit is not something Ms. Slongo believes she should be taking when many of her work shifts do not end until midnight. Also, due to Ms. Slongo’s own inability to operate a motor vehicle, she is not able to help her 86 year old mother get to her own appointments, and to run errands, and this is something that Jennifer now does for her grandmother, with whom she is especially close.
20Jennifer has aspirations to eventually own her own horse-training academy for underprivileged and disabled children. She is seeking to merge two of her biggest passions in life, being her love of children and horses. Ms. Slongo fully supports Jennifer in this endeavour, and believes she has limitless potential, a strong work ethic, and a reasonable plan for own self-sufficiency.
21Ms. Slongo points out that the University of Guelph has confirmed that the Equine Program through Open Learning and Educational Support is a university-level program, “and as such, the course content, expectations and rewards are aligned with such a program.”
22Despite the evidence of Ms. Slongo that Jennifer is unemployed, Ms. Slongo has also filed an unsworn letter that sets out that Jennifer is currently employed as a stable hand for Schellenberg Stables, where she is applying the knowledge and skills she acquired from her University of Guelph post-secondary program.
23The owner of Schellenberg Stables, Ms. Angie Dunlop, remarks that “[t]hrough the completion of the program, [Jennifer] will have obtained the skills and knowledge that is necessary to be able to run a business. These skills are vital to be able to run a barn, and Jen will now have that opportunity in the future as a result of this diploma program.”
ii) Positions of the Parties
24Ms. Slongo submits that Mr. Slongo does not have the right to stop supporting Jennifer, as Paragraph 12(c) states that child support stops once a child obtains one post-secondary educational degree or diploma or turns 23 years of age, whichever occurs first.
25Mr. Slongo asserts that Jennifer’s current choice of online courses is not a reasonable plan of education or career plan; in fact it essentially negated the previous course of study, most of which was funded by him. It seems that Jennifer is searching for a career plan. She has little prospect of solidifying any future career with non-degree, online courses that cannot be applied to a degree program of study.
26In reply, Ms. Slongo submits that Jennifer is taking a number of on-line courses which are suitable for her interests and future vocation (i.e. to own and operate her own horse training academy for underprivileged children).
27Thus far, Mr. Slongo has paid 60% of the cost of Jennifer’s Equine Studies program.
iii) Analysis
28Pursuant to two terms of the agreement, child support has come to an end; Jennifer is 23 years of age. She also completed her education on a full time basis in December of 2012. However, it is clear that child support is the right of the child and cannot be bargained away by a parent to the detriment of the child. See: Domik v. Ronco, 2013 ONCJ 197, [2013] W.D.F.L. 3862 at paras 84 and 85,177.
29The agreement also incorporates the definition of “child of the marriage” pursuant to the Divorce Act or the Child Support Guidelines.
30Under the Divorce Act:
“child of the marriage” means a child of two spouses or former spouses who, at the material time,
(a) is under the age of majority and who has not withdrawn from their charge, or
(b) is the age of majority or over and under their charge but unable, by reason of illness, disability or other cause, to withdraw from their charge or to obtain the necessaries of life;
31Both the federal and Ontario Child Support Guidelines incorporate that definition into the respective Guidelines.
32Jennifer is over the age of majority; subsection (a) does not apply.
33There is no evidence that she has any illness or disability that prevents her from withdrawing or obtaining the necessaries of life. Is there another cause?
34The determination of eligibility for support for an adult child is dependent on the facts of each case. See: Rebenchuk v. Rebenchuk, 2007 MBCA 22, [2007] M.J. No. 130.
35I appreciate that Mr. Slongo’s contribution to her education so far and his professional standing suggest that continuing Jennifer’s education could be expected. However, there are factors that suggest otherwise.
36Jennifer almost completed her education plan but for one credit in December of 2012. She obtained her certificate in May of 2013. She then changed her plan. Filed with the materials, is correspondence from the University of Guelph dated October 6, 2013. As set out above, it confirms the courses in which Jennifer is enrolled. But it also says: “These programs are classified as “Continuing Education”, and as such, are not degree credit, which means that they cannot be applied to a degree program of study”.
37While Jennifer can be given credit for remaining at home to assist her mother and grandmother, she is not unable to obtain the necessaries of life. She should be earning an income but instead is taking on line courses at home while working as a stable hand at a local stable. The evidence is unclear what she is earning there. All I have is an unsworn letter from her employer who speaks of her opinion of the courses that Jennifer is taking. Unsworn, non-expert opinions are not evidence upon which I can determine the reasonableness of a 23 year old child’s plan of study.
38There is no evidence of the total cost of the plan or Jennifer’s ability to pay a portion of the cost. There is no evidence of her eligibility for O.S.A.P.
39While Jennifer’s present employer might be optimistic of her future success, there is no evidence before me that Jennifer’s present plan – on-line non-credit courses, part time employment, full time care for her mother and grandmother– is a reasonable plan that Mr. Slongo should be required to support. If he does, that is to his credit, but I cannot make an order requiring him to do so.
(iv) Result
40Ms. Slongo’s claim for retroactive and on-going child support is dismissed as of January 1, 2013.
2. Has Mr. Slongo’s early retirement brought about a material change in circumstances that will allow for a variation of the order and agreement?
i) Background
41In their agreement, the parties agreed that (I have bolded the particularly relevant terms) :
Commencing in 2009, on or before July 1st of each year, the parties shall exchange the following information with each other in order to determine any change in the quantum of child and spousal support being paid:
(a) Their income tax returns and notices of assessment for the previous taxation year;
(b) A current pay stub evidencing his or her gross annual income received to date in that year;
(c) Full particulars pertaining (including statements and receipts) to any special or extraordinary expenses incurred or to be incurred for the children, such as post-secondary educational costs;
(d) Details of any tax benefits or other child benefits that have been received in the previous year and the anticipated in the current and coming years; and
(e) Any other documentation and information required to establish in the review of child and spousal support.
In light of this provision, the parties shall readjust the child and spousal support payable to try and avoid the cost of an unnecessary court application; it being anticipated that the parties will mutually agree, in writing, to a change in the quantum of child and spousal support, if necessary. Should the parties fail to disclose the said information to one another in a timely manner, he/she shall be liable to the other for her/his costs in order to bring an application to court payable on a full recovery basis. Should an adjustment be required to the quantum of support payable (whether a lessor or a greater amount), the parties shall adjust the amount payable, by either the Wife reimbursing the Husband directly, if the quantum of support is less or the Husband paying the Wife directly the extra amount, if the quantum of support is greater.
Until the child and spousal support provisions of this Agreement are adjusted by an amending agreement, court order or arbitration award, the Husband will continue to pay the child and spousal support amounts set out above pursuant to paragraphs 8 and 17.
In addition to a yearly review of the child and spousal support arrangements in this Agreement, either the Husband or the Wife may seek a change in child and/or spousal support if there is a material change in the condition, means, needs or other circumstances of the Husband, Wife or Children that would affect child and/or spousal support.
A material change in the condition, means, needs or other circumstances of the parties or Children may be foreseen, unforeseen, foreseeable or unforeseeable, and may include:
(a) A material change in either party’s financial position. The parties acknowledge and agree that at the present time, the Husband is intending to continue to work at Nuclear Safety Solutions Ltd. Until he turns age 65 (i.e. August 1, 2024), notwithstanding he will be eligible to retire early from Nuclear Safety Solutions Ltd. On an unreduced pension effective on or after August 1, 2012. For the purposes of determining if a change in the quantum of periodic spousal support payable by the Husband to the Wife from and after August 1, 2012 to August 1, 2024 is warranted pursuant to paragraph 17 above, the parties acknowledge and agree that the Husband’s cessation of employment prior to age 65 may constitute a material change in circumstances;
(b) Retirement at the “normal” retirement age of 65;
(c) The parties acknowledge and agree that a material change in circumstances shall be deemed to exclude the Wife earning business or employment income of up to $30,000.00 per calendar year of the Husband earning employment income up to $145,000.00 per calendar year;
(d) The parties further acknowledge and agree that a material change in circumstance shall be deemed to exclude either party receiving a bequest or bequests; and
(e) A change in the number of Children entitled to receive support under this Agreement.
42These terms were confirmed in both orders.
43Pursuant to paragraph 21(c) of the Agreement, the parties further agreed that a material change in circumstances for the purpose of varying the quantum of child or spousal support would exclude Ms. Slongo earning business or employment income of up to $30,000.00 per calendar year, or Mr. Slongo earning employment income of up to $145,000.00. In 2008, Mr. Slongo earned employment income in excess of this quantum, thereby triggering the material change clause.
44In 2007, Mr. Slongo earned $142,487.
45In 2008, Mr. Slongo earned more than $145,000 as set out in the agreement. The parties worked out a new support figure based on that change of circumstance. That apparently led to Justice Daley’s order in 2009.
46I do not appear to have what Mr. Slongo earned in 2009, but nothing turns on that in any event.
47In 2010, Mr. Slongo earned $149,803.93. The parties worked out a new support figure based on that change of circumstance. That apparently led to my order in 2011.
48In 2011, Mr. Slongo earned $151,429.40.
49In August of 2012, Mr. Slongo retired from Ontario Hydro, and began to receive annual cash and LIRA payments effective September 1, 2012, and for the next 5 years thereafter (i.e. through to and including September 1, 2017), pursuant to the following chart:
| Payment Dates | Amounts to be Paid | LIRA | Cash |
|---|---|---|---|
| September 1, 2012 | $ 1,016,942.29 | $ 339,895.72 | $ 677,046.57 |
| September 1, 2013 | 193,181.37 | 59,063.88 | 134,177.49 |
| September 1, 2014 | 189,196.46 | 60,219.61 | 128,976.85 |
| September 1, 2015 | 185,211.55 | 61,375.33 | 123,836.22 |
| September 1, 2016 | 181,226.64 | 62,531.06 | 118,695.58 |
| September 1, 2017 | 177,241.76 | 63,747.46 | 113,494.30 |
| $ 1,943,000.07 | $ 646,833.06 | $ 1,296,167.01 |
50When Mr. Slongo formally retired from Ontario Hydro in August of 2012, he returned to work for the same employer within days or weeks of retiring. However, he was now a “self-employed consultant” billing his former employer at the rate of $115.00 to $125.00 per hour.
51Ontario Hydro’s business reasons for this development were not explained and do not add to the analysis of the questions that I am asked to determine.
52Mr. Slongo’s 2012 Income Tax Return shows that he claimed net professional income of $43,728.20 and employment income of $123,047.00. His line 150 total income was $855,919.
53His 2013 Income Tax Return shows net business income of $176,868 and a line 150 income of $329,106.19.
54This motion was first argued in October 2014. Although I asked for further submissions, I did not allow further evidence. Accordingly, I do not know what Mr. Slongo’s professional income was for 2014.
ii) Positions of the Parties
55Ms. Slongo relies on the plain meaning of the terms of the agreement.
56Mr. Slongo submits that his early retirement was contemplated at the time of the agreement and there has been no change in circumstance that would allow this court to vary the order. Related to the pension issue, below, he says that Ms. Slongo has already received her share of the pension in her equalization as determined by the separation agreement.
57Further, he says that his income has remained relatively the same since the last variation which occurred in 2011. In 2010, his income was $149,803. In 2011, his income was $151,429. In 2012, excluding the portion of the commuted value of his pension taken into income, his income was comprised of both employment and self-employment income and totalled $166,579. He says that these amounts are not material having regard to the Agreement and the applicant’s support entitlement.
58Mr. Slongo does concede that, in accordance with the principles set out in Boston v. Boston, 2001 SCC 43, [2001] 2 S.C.R. 413, I may focus on that portion of his early retirement which has not been equalized already, $321,072, to determine his income for support, but only if Ms. Slongo can show that she has a continued need for greater support. I will return to that figure when I consider the issue of the equalization.
59Mr. Slongo also agrees that the Agreement permitted a change to be considered if there was a change in the number of children entitled to receive support. Given his position that the children are no longer entitled to receive support, he concedes that it is open to me to review his income including the unequalized portion of his pension for support purposes. His position is that I should not look at more than $160,536 spread over the period 2012 to 2017, or $32,107 after tax.
60In short, he effectively concedes that there has been a change in circumstances.
iii) Legal Principles
61Pursuant to s. 17 of the Divorce Act, a court may only vary a child or spousal support order if it can satisfy itself that a change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order or the last variation order made in respect of that order, and, in making the variation order, the court shall take that change into consideration.
62The threshold question under s. 17, in deciding whether the conditions for variation exist, the change must be a material change of circumstances. This means a change, such that, if known at the time, would likely have resulted in different terms. See: L.M.P. v. L.S., 2011 SCC 64, [2011] S.C.J. No. 64.
iv) Analysis
63I am satisfied that there has been a material change in circumstances such that spousal support can be varied.
64The parties’ agreement says that. The Divorce Act says that. The case law says that. Even Mr. Slongo eventually says that.
65The agreement, as confirmed by the consent orders, sets out that Mr. Slongo’s early retirement, an increase in income, and a change in the number of children entitled to child support all amount to a change of circumstance. All have occurred. There has been a change in circumstances permitting me to consider a variation.
(v) Result
66The next questions are more important; even if there has been a change in circumstances, should I, or to what extent should I, vary spousal support?
3. To what extent has the pension payout already been equalized in their earlier order and agreement?
i) Background
67This is the real issue between the parties. If the pension has already been equalized, there is arguably less in the hands of Mr. Slongo to pay to Ms. Slongo – she has already received her share. If there are funds that have not been equalized, to what extent should they be used to add to Ms. Slongo’s support?
68In the parties’ settlement discussions relating to property division, Ms. Slongo proposed to settle the value of Mr. Slongo’s pension that the value of the pension would be the average of the “age 65” and “earliest retirement date” commuted values. Mr. Slongo was unwilling to accept that proposal. He took the position that, given the family circumstances before separation, it was his well understood intention to work to 65.
69Ms. Slongo eventually agreed to the “age 65” value of his pension for settlement purposes. That amount was determined to be $268,133.00 (after tax).
70Despite Mr. Slongo’s expressed intention to work to 65, as we know now, he retired in 2012 at age 55. For the purposes of my analysis, I need not determine what his true beliefs were at the time of the negotiations. It is clear from the turn of events that he would have retired as he did, regardless of what he may have thought at the time of separation.
71Since his pension is now expected to pay him for 10 years longer than was expected at the time of separation, its value, for that reason, along with others represents a much larger value than was agreed upon.
72Ms. Slongo obtained an opinion from the same actuary initially retained by Mr. Slongo to value his pension at separation. She wanted him to determine what portion of the pension payout in 2012 was not included in the property settlement of 2008.
73Mr. Norton valued the pension as at 2012 as $843,603. He said:
The ratio of $263,133 [sic] divided by $843,603 (i.e., 31.19% [sic] ) represents the portion of the commuted value payments that had been equalized. As such, consistent with my understanding of the principles established by the Supreme Court of Canada in Boston vs Boston that generally precludes “double dipping”, when considering the issue of post-retirement spousal support, 31.19% of the commuted value amounts should be disregarded, having been equalized, and the complement, 68.81% [sic] of the commuted value amounts, having not been equalized, could still be considered as income for post-retirement spousal support purposes.
ii) Positions of the Parties
74Ms. Slongo says that I should accept Mr. Norton’s opinion and share the unequalized value of the pension to her through support. She says that the amount is best resolved by imputing $49,865.56 for each of the years 2012 to 2024 and $43,220.33 after 2025 as suggested by Mr. Norton in his report.
75Mr. Slongo says that he has already equalized the value of his pension with the Applicant in 2008. To the extent that the present value of the commuted value of the pension received is greater than the value equalized, the difference has to be broken down into its component parts as opposed to looking at the pension as one single amount. Each component part has its own independent impact on the value of the pension received. The various parts are:
i. The respondent’s retirement at an earlier date than his normal retirement;
ii. The passage of time;
iii. Premarital and post separation service (the respondent had an additional five years of service post separation);
iv. Changes in interest rates; plus
v. Change in the mortality assumptions; and
vi. Post retirement survivor benefits.
76Mr. Slongo submits that any change in value of the pension received relating to component parts (iv), (v), and (vi), are post separation changes in value of the asset. To treat this as income received by Mr. Slongo as a result of these changes would have the effect of further equalization of property. It is no different than an investment account that goes up in value after equalization. In that circumstance, the other spouse has no claim to post separation changes in value and the commuted value of the pension as a result of the factors herein should be treated the same. In other words, factors (iv), (v), and (vi), are post separation changes in the value of an asset already equalized and to pay support on that money, would be a readjustment of the property settlement reached by the parties.
77Mr. Slongo says that factor (i) was already considered in the Norton report. The report had scenarios for value that included an early retirement. The passage of time, factor (ii), relates to the period between the date of separation and the date that Mr. Slongo actually settled on his pension. As such, the fact that he took early retirement was a factor considered by the parties when they made their agreement.
78If the court is going to consider any factor in this regard, it must be limited to factor [iii], any income earned by Mr. Slongo as a result of post separation period of employment.
79At most, he says that the added income is $32,107 over each of the five years from 2012 to 2017.
iii) Pension Reports
80The evidence that I have before me on this issue includes the reports of Mr. Norton dated November 5, 2007 and October 24, 2013 in support of Ms. Slongo’s position. Mr. Norton also testified and was cross-examined on October 21, 2014. In support of Mr. Slongo’s position, I have the reports of David Wolgelerenter, dated June 20, 2013 and November 14, 2013. Mr. Wolgelerenter did not testify but his reports were filed on consent.
81Mr. Norton, in his evidence of October 21, 2014 commented on the report of Mr. Wolgelerenter. Unfortunately, I have no comment by Mr. Wolgelerenter on Mr. Norton’s reports or evidence. Both actuaries acknowledged that the effect of the list of factors set out in the appendix to the Wolgelerenter report (and referred to above in the position of Mr. Slongo), can vary depending on the order in which they are calculated. Mr. Norton agreed that the factors were appropriate. They agreed that no particular order is better than another. They agreed that depending on the order of consideration, the values would change although the total pension value could not.
82When I reserved in the fall of 2014, I found that I could not make a determination of the value of each factor even if I could determine which were appropriate to apply. I needed further assistance with respect to the most appropriate order to follow in this particular case.
83This could have come from Mr. Wolgelerenter or, better yet, from both actuaries after they have discussed it together. Another way to resolve this issue would have been to simply accept the evidence of Mr. Norton since I have no evidence to the contrary. For a variety of reasons to follow, I was hesitant to rely entirely upon Mr. Norton’s opinion. I therefore sought assistance from counsel. Mr. Buttigieg, on behalf of Ms. Slongo submitted that I should determine the issue on the record before me without any further assistance. Mr. Fogelman suggested that further questions could be put to the two experts in writing and the answers filed. Neither wished to have the experts meet to provide a possible consensus. Neither wished to have a trial of an issue.
84After some consideration, I find that I should accept Mr. Buttigieg’s submission. It is Ms. Slongo’s application. She should be able to determine the evidence upon which she wishes the court to make its determination. Mr. Slongo had already elected to file only Mr. Wolgelerenter’s report in response.
iv) Mr. Norton’s Expertise
85There was no dispute as to Mr. Wolgelerenter’s expertise.
86As set out in his resume, Mr. Norton was certainly qualified to give his opinion. However he made a singularly unimpressive expert witness; he was combative and defensive about his position.
87Although his current resume said that he was a Fellow of the Society of Canadian Institute of Actuaries, he has not been so since May 31st, 2008. His present resume states, “Attained Associateship, Society of Actuaries (1971) and Fellowship, Society of Actuaries and Canadian Institute of Actuaries (1975). Despite that, he denied that the resume is misleading.
88His decision to resign from the Canadian Institute is coincidental with a reprimand that he received in July of 2008 from the Institute. Although he was presented with the joint submission and reasons for the reprimand, he denied that he acknowledged any failure on his part. Indeed, he said that he did not “give a damn” what it said. He appears to regard the professional standards of the Canadian Institute as something that do not apply to him.
89His report showed arithmetical errors but he seemed unconcerned about them.
90Mr. Norton appears to consider his opinions to be correct and any contrary view is irrelevant to him. His attention to detail – his arithmetic and resume – is unreliable. If necessary, I would not rely on his opinions.
91On the other hand, the pension valuation issues here are not particularly complex. They would not be difficult to most sophisticated family law lawyers with experience in pension issues. I dare say, they could probably do these calculations on their own. That is not to say the rest of us are not challenged when we run into these issues from time to time, but I do not need the best and most reliable expert to give me what I need here. But if I did, Mr. Norton would not be the one I would draw on.
v. Analysis
92To summarize, Ms. Slongo submits that support should be based on an unequalized pension value of $575,470 ($843,603 minus $268,133). Mr. Slongo submits that, at most, the unequalized amount is $321,720 – the difference between the two values of the pension as calculated at the time of the agreement.
93The two experts agree that items 2 through 6 should not be taken into account in valuing the increase in the pension except with respect to the pre-marriage service by Mr. Slongo. Mr. Norton has added the pre-marriage service into the value. In my view, he is wrong in that since that would not have been included in the value for Family Law Act purposes. Indeed, in 2007 he did not include that amount in his valuation. But Mr. Slongo was employed for only four and half months prior to marriage. In 2007, that value was determined to be something in the area of $4,000.00 to $9,000.00. For reasons set out below, that difference will not make a significant difference to my determination.
94Mr. Slongo denied that item 1 should be taken into consideration. He says that it was already determined in the first negotiations. It is true that it was considered however, one of the material changes that was considered was an early retirement by Mr. Slongo. That brings that factor into play here.
95But ultimately, it is agreed that all of the factors referred to by Mr. Wolgelerenter and relied upon by Mr. Slongo are guesses as to how the employer valued the pension at more than a million dollars. Both actuaries agree that, depending on the order of applying the factors, the value of the factors that do come into play can increase or decrease. And both agree that there is no right order to apply them. And even at Mr. Wolgelerenter’s ordering, there is still $58,000.00 untraced to the ultimate value. Both have made assumptions on how the values would be taxed.
96And no one has asked the employer how it was calculated.
97On the basis of Mr. Wolgelerenter’s opinion, I cannot determine how much of the present value has already been equalized to a mathematical certainty. I am not free to do my own tax calculations. Fortunately, for reasons below, it is not necessary for me to determine that value to a mathematical certainty. However, it is clear that something between the two values put forward by the parties has not been equalized and is available to vary Ms. Slongo’s support.
98It must be kept in mind that, to the extent that the pension has increased in value, Ms. Slongo is only entitled to claim against half of it. If the full value that we now have had been added to Mr. Slongo’s net family property at separation, Ms. Slongo would only get a credit for half of it.
99And finally, the increased amount is being paid out over five years. So the amount to vary spousal support over those years becomes less significant.
100I cannot rely on Mr. Wolgelerenter’s valuation – it is too subjective and uncertain. Mr. Norton, despite my concerns set out above, has been employed by both parties. He applied the same principles to both valuations and Mr. Wolgelerenter has not opined that Mr. Norton was wrong. The only changes that he applied were removing assumptions from the past valuation where they were certainties based on the real retirement date and the confirmed terms of pension details given by the employer.
(vi) Result
101I find that the value of the unequalized portion of Mr. Slongo’s pension is $575,470 after tax or $57,000 annually over 5 years, after deducting an amount for pre-marriage service.
4. If Ms. Slongo’s spousal support is to be varied, to what extent should I rely on the SSAG?
(i) Analysis
102At the first hearing, it was Ms. Slongo’s submission that I should determine spousal support on the basis of the high end of the SSAG in line with what I determined Mr. Slongo’s income to be.
103In my view, serious errors can occur when one simplistically applies the Divorcemate calculations to found income to determine spousal support. The Guidelines are a binder of information, not simply a computer software calculator. The authors of the SSAG have addressed the application of the SSAG in the context of a variety of circumstances with a section specifically entitled “Exceptions”. Boston is specifically referred to in a separate subsection.
That law remains in place, as a possible constraint upon the amount of support, determining if some portion of income should be excluded from the formula because it has been previously shared under property division.
104A closer analysis is required than simply relying on the calculations produced by a computer.
105In Gray v Gray, 2014 ONCA 659, [2014] O.J. No. 4519, our Court of Appeal said
45In some cases, there are complicating factors that must be considered before a court applies the SSAG wholesale. Complicating factors that courts ought to consider include variations based on the post-separation income increase of the payor, or situations with second families. In such cases, the court must conduct an analysis of the facts of the specific case to assess whether the SSAG ranges are appropriate.
106While the Guidelines may be useful in this case as a check, for the reasons that follow, I am not persuaded that they should be applied as a simple matter of arithmetic.
5. If a variation is appropriate, to what extent should Ms. Slongo’s spousal support be varied?
(i) Ms. Slongo’s Circumstances
107After the marriage breakdown, Ms. Slongo obtained employment with Shoppers Drug Mart as a cosmetician. She earned $10.55 per hour and received a guarantee of 29 hours per week. She tried to pick up extra shifts when available, but did not usually receive more than 4 or 5 extra hours of work per week.
108Ms. Slongo submits that she still has an ongoing need for spousal support. Since the marriage broke down, she has not been able to live at the same standard that she enjoyed prior to the breakdown of the marriage. She has incurred substantial debt since the breakdown of the marriage. Ms. Slongo owes approximately $96,000.00 on lines of credit and a second mortgage, which were incurred for living expenses and to make needed repairs to her residence (in addition to her mortgage of over $243,000.00). At the present time, the roof on her residence is in dire need of being replaced. Ms. Slongo presently uses her line of credit to pay the mortgage.
109Ms. Slongo suffers from vision impairment and cannot safely operate a motor vehicle. She is presently reliant on one of the parties’ children, in order to get herself to and from her home and place of employment. This factor limits her ability to work as she is required to have strong vision in order to make cosmetic product recommendations to the clientele of her employer. Ms. Slongo’s vision is getting progressively worse, which causes her to suffer from headaches and fatigue.
110Ms. Slongo was examined by a neuro-ophthalmologist who suspects that Ms. Slongo has a pituitary tumor in her brain. At the time of the argument in 2014, she was on a waiting list for an MRI scan to provide further insight. In the event Ms. Slongo is determined to have this tumor, her treatment options are limited as she also suffers from a blood disease which inhibits clotting. Ms. Slongo has been told that she may suffer a complete loss of vision in the future.
111Ms. Slongo has “missing disks” in her back. She also has a prosthetic jaw on both sides, which require replacement. She attends numerous health appointments on a weekly basis, including chiropractic, massage, acupuncture, ophthalmologist, and GP appointments, on average of 3 to 4 per week.
112She says that she continues to suffer economic disadvantage as a result of the roles of the marriage and the breakdown of the marriage. In order to provide for Ms. Slongo’s reasonable needs, she requires at least $88,000.00 per year. She has been running a budget deficit of more than $30,000.00 annually since separation.
113At her examination, she testified that she had lost her employment through no fault of her own on January 23, 2014. She then found part time employment of approximately 12 hours per week.
114The two youngest children live in Ms. Slongo’s home. Rebecca has started to pay $300.00 per month to help cover some of her living expenses (Rebecca is working full-time at a local Hilton hotel), but she is trying to get on her feet and save some money. Rebecca has told Ms. Slongo that she would like to move out of her residence within the next year. Jennifer is not employed and completely reliant on Ms. Slongo for her support.
115The parties’ marriage was both long-term and traditional. While married to Mr. Slongo, Ms. Slongo did not work in the paid workforce from shortly before she gave birth to the parties’ first child, Kimberly in 1987. From 1987 forward, Ms. Slongo was a full-time stay-at-home wife and mother, and her focus was on raising the children, and managing all aspects of the parties’ household.
116Mr. Slongo built a successful career as a Nuclear Safety Specialist with the government-owned Ontario Power Generation (formerly known as Ontario Hydro). Mr. Slongo had been employed since shortly before the parties married in October of 1984, and he worked himself up the ranks, to his present position.
117The roles of the Slongo marriage enabled Mr. Slongo to thrive professionally, and as such, Mr. Slongo has derived an economic advantage from the marriage. Ms. Slongo provided domestic work and services to, for and on behalf of Mr. Slongo, throughout the marriage, including cooking all family meals, cleaning and ironing his clothes, keeping the home neat and tidy, entertaining friends and family, and supporting Mr. Slongo emotionally. Due to Ms. Slongo’s spousal contributions, Mr. Slongo would not have been able to devote himself completely to his career, as Ms. Slongo ensured that the parties’ daughters’ day-to-day needs were met to a high standard.
118Prior to the breakdown of the marriage, the Slongo family enjoyed a very comfortable lifestyle, as a result of Mr. Slongo’ career focus and professional development.
119In 2012, Ms. Slongo earned approximately $27,000.00
120In 2013, Ms. Slongo earned approximately $25,000.00
121In her Financial Statement sworn in May of 2014, she appeared to be earning less than $600.00 per month.
(ii) Mr. Slongo’s Circumstances
122Mr. Slongo has re-partnered, and his new wife earns an annual income as a part-time nurse, of $80,000.00.
123As set out above, in August of 2012, Mr. Slongo retired and began to receive annual cash and LIRA payments effective September 1, 2012, and for the next 5 years thereafter (i.e. through to and including September 1, 2017), pursuant to the following chart:
| Payment Dates | Amounts to be Paid | LIRA | Cash |
|---|---|---|---|
| September 1, 2012 | $ 1,016,942.29 | $ 339,895.72 | $ 677,046.57 |
| September 1, 2013 | 193,181.37 | 59,063.88 | 134,177.49 |
| September 1, 2014 | 189,196.46 | 60,219.61 | 128,976.85 |
| September 1, 2015 | 185,211.55 | 61,375.33 | 123,836.22 |
| September 1, 2016 | 181,226.64 | 62,531.06 | 118,695.58 |
| September 1, 2017 | 177,241.76 | 63,747.46 | 113,494.30 |
| $ 1,943,000.07 | $ 646,833.06 | $ 1,296,167.01 |
124Mr. Slongo’s 2012 net professional income was $43,728.20, his income from employment prior to retirement appears to have been $123,047.00 and his line 150 total income was $855,919.
125His 2013 Income Tax Return shows net business income of $176,868 and a line 150 income of $329,106.19.
(iii) Positions of the Parties
126As I worked on my decision after the first argument, I was not sure that either no change or full Guideline amount was correct. I had not yet decided if the Guidelines applied; however, no submissions were made as to what the spousal support should be on a means and needs basis. I provided my ruling that there had been a change in circumstance and that child support was no longer payable. Accordingly, I sought submissions on spousal support only. I did not believe that it was fair for me to enter into that determination without greater input from counsel. That issue was argued on February 13, 2015.
127In her Motion to Change, as amended, Ms. Slongo requested monthly spousal support of $7,469 based on the high end of the Guidelines. In argument in February, Ms. Slongo submitted that support should be payable in the amount of $13,000 per month based on a 50/50 split of the two incomes. She submitted that her needs were such that $88,000 per year was the appropriate support.
128Mr. Slongo argued that support should be in the range of $4000 to $5000 based on Ms. Slongo’s legitimate needs as set out in her Financial Statement. He submitted that Ms. Slongo had not been financially sensible and Mr. Slongo should not be required to fund her financial errors. He does not submit that spousal support should come to an end.
(iv) Legal Principles
129An order varying a spousal support order should
(a) recognize any economic advantages or disadvantages to the former spouses arising from the marriage or its breakdown;
(b) apportion between the former spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;
(c) relieve any economic hardship of the former spouses arising from the breakdown of the marriage; and
(d) in so far as practicable, promote the economic self-sufficiency of each former spouse within a reasonable period of time.
130The SSAG provide a non-exhaustive list of factors that may result in the quantum of spousal support being fixed at the high-end of the range. The listed factors that are relevant here are:
(a) The recipient has a strong compensatory claim (eg. recipient moved/gave up employment for payor’s benefits; recipient funded payor’s education/training; recipient sacrificed employment opportunities because of child care).
(b) The recipient has limited income.
(c) The recipient has limited earning capability.
(d) The recipient has compelling needs and standard of living.
(e) The recipient is older.
(f) The marriage is long term.
(g) There is no property to be divided.
(h) The recipient is carrying significant family debts (but not severe enough to fall within debt payment exception).
131The goal of self-sufficiency is one that is not often attained following the break-up of a long-term marriage. Economic disadvantage or hardship will often persist. For this reason, it is not surprising that trial and appellate courts have found in the facts before them the circumstances that permit double recovery in spousal support orders/agreements. See: Cymbalisty v. Cymbalisty, 2003 MBCA 138, 232 D.L.R. (4th) 718.
132In the 2003 decision of Marinangeli v. Marinangeli, 2003 CanLII 27673 (ON CA), [2003] O.J. No.2819, 66 O.R. (3d) 40 (C.A.), where the facts indicate that the wife had a compensatory spousal support claim, the court made the following comments respecting need and ability to pay:
"In determining need, the court is to be guided by the principle that the spouse receiving support is entitled to receive the support that would allow her to maintain the standard of living to which she was accustomed at the time cohabitation ceased. In addition, there is jurisprudence to the effect that a spouse is entitled to an increase in the standard of living such as would have occurred in normal course of cohabitation. At the same time the court must guard against redistributing the payor's capital in the guise of support."
133The authors of the SSAG and the cases decided since the Guidelines were introduced have established that the treatment of post-separation increases in a payor's earnings in spousal support cases is ultimately a matter of discretion for the court, to be undertaken having regard for the unique circumstances of each case and the general factors and objectives underlying spousal support.
134In Thompson v. Thompson, 2013 ONSC 5500, [2013] O.J. No. 4001, Chappel J. considered these factors and objectives and the relevant case-law, and concluded that there were general principles that should guide and inform the court's exercise of discretion on this issue. The relevant ones here are:
a) A spouse is not automatically entitled to increased spousal support when a spouse's post-separation income increases.
b) Compensatory support claims may provide a foundation for entitlement to share in post-separation income increases in certain circumstances. The strength of the compensatory claim and the nature of the recipient's contributions appear to be the major factors which may tip the balance for or against an entitlement to share in the increased income.
c) The recipient spouse may be permitted to share in post-separation increases in earnings if they can demonstrate that they made contributions that can be directly linked to the payor's post-separation success. The nature of the contributions does not have to be explicit, such as contribution to the payor's education or training. The question of whether the contributions made by the recipient specifically influenced the payor's post-separation success will depend on the unique facts of every case.
d) In determining whether the contributions of the recipient were sufficient, the court should consider such factors as whether the parties divided their family responsibilities in a manner that indicated they were making a joint investment in one career, and whether there was a temporal link between the marriage and the income increase with no intervening change in the payor's career.
e) If the skills and credentials that led to the post-separation income increase were obtained and developed during the relationship while the recipient spouse was subordinating their career for the sake of the family, there is a greater likelihood of the recipient deriving the benefit of post-separation income increases.
f) By contrast, the likelihood of sharing in such increases lessens if the evidence indicates that the payor spouse acquired and developed the skills and credentials that led to the increase in income during the post-separation period, or if the income increase is related to an event that occurred during the post separation period.
g) Where the payor's post-separation advancement is related primarily to luck or connections which they made on his own, rather than on contributions from the recipient, the claim for a share in post-separation income increases will be more difficult.
135In Pustai v. Pustai, 2014 ONCA 422,319 O.A.C. 403, the Ontario Court of Appeal, confirmed that once a material change in circumstances has been established, the variation order should reflect the objectives set out in s. 17(7),and take into account the material changes in circumstances, and consider the existence of the separation agreement and its terms as a relevant factor. A court should limit itself to making the variation order which is appropriate in light of the change. The task should not be approached as if it were an initial application for support under s. 15.2 of the Divorce Act.
136In Gray v. Gray, our Court of Appeal said that:
27One of the objectives of the Divorce Act is to relieve economic hardship. Need is not measured solely to ensure a subsistence existence, but rather should be assessed through the lens of viewing marriage as an economic partnership. As stated by this court in Marinangeli v. Marinangeli, in determining need, courts ought to be guided in part by the principle that the spouse receiving support is entitled to maintain the standard of living to which she was accustomed at the time cohabitation ceased. The analysis must consider the recipient’s ability to support herself, in light of her income and reasonable expenses.
38The purpose of compensatory support is to share the economic advantages and disadvantages that accrued because of the marriage and its subsequent breakdown. In Moge v. Moge, the Supreme Court explained the principle behind the compensatory model of support as follows:
Today, though more and more women are working outside the home, such employment continues to play a secondary role and sacrifices continue to be made for the sake of domestic considerations. These sacrifices often impair the ability of the partner who makes them (usually the wife) to maximize her earning potential because she may tend to forego educational and career advancement opportunities. These same sacrifices may also enhance the earning potential of the other spouse (usually the husband) who, because his wife is tending to such matters, is free to pursue economic goals.
137Where a pension is equalized by way of a lump sum payment, the payee is under an obligation to use those assets in an income-producing way. She must use the assets received on equalization to create a “pension” to provide for her future. See: Boston.
(v) Analysis
138I am not dealing with a difficult issue of so-called double dipping. Rather, I am determining a variation based on unequalized assets. There is no suggestion that support should come to an end.
139One has to assume that the initial orders are correct. I must assume that support of $2,650.00 per month responded to all of the factors to be considered under the Divorce Act.
140There is no doubt that, given her contributions to the marriage, Ms. Slongo has contributed to Mr. Slongo’s ability to place himself in a position to gain the income in issue. On the other hand, but for the business issues that seem to have driven Mr. Slongo’s employer to provide this opportunity, there is some luck unrelated to the contribution made by Ms. Slongo.
141Considering the incomes of the parties and adding $57,500 to Mr. Slongo’s income, the SSAG would indicate support over 2012 and 2013 to be something between $6,000.00 and $8,000.00 ranging from the low to the high range.
142The parties were married for 23 years and have been separated for a little over seven. Ms. Slongo stayed home and raised the children while Mr. Slongo had a successful career. There is still a significant compensatory basis for the support.
143Ms. Slongo appears to be doing the best she can to obtain income given her job experience, health and age. She still has a significant need for spousal support.
144However, Ms. Slongo has not been reasonable with her expenses. Her failures should not be foisted upon Mr. Slongo.
145Following their separation, Ms. Slongo purchased a new home for $442,000. It is a four bedroom, two storey house. She used her equalization payment and entered into a mortgage for $287,300. The interest rate at that time was prime less .6%.
146In May 2012 she gave a new mortgage to the Royal Bank under which she could borrow up to $350,000 at a rate of prime +7%. While she may have needed those funds to do work around the house, there is no explanation as to why those unfavorable terms were entered into.
147She has two lines of credit totaling almost $100,000 and credit cards totaling over $10,000. There is no explanation as to why she is paying high interest on her credit cards when the interest would be cheaper on the line of credit.
148She has unpaid income taxes and property taxes of approximately $10,000.
149She requires $755 per month to own and maintain 10 cats and five dogs.
150It must be remembered that, but for the opportunity to retire early, Mr. Slongo may have continued to work as anticipated in the separation agreement. If so, Ms. Longo was clearly mismanaging her affairs. The change in Mr. Slongo’s pension plan should not be an opportunity for the court to revisit Ms. Slongo’s financial decisions after separation.
151All of these factors make the underlying assumptions of the SSAG less helpful. Rather, I turn to consider the following.
152I place weight on Ms. Slongo’s circumstances that have arisen as a result of Mr. Slongo’s economic advantages arising from the marriage. That is to say, Ms. Slongo’s contribution to his professional success.
153I do not see that there is any continuing factor relating to the care of the children of the marriage other than to the extent that Ms. Slongo took care of the children to allow Mr. Slongo’s success. There are no continuing and necessary expenses that Ms. Slongo needs to make related to the children.
154While there is significant economic hardship being suffered by Ms. Slongo, it does not arise from the breakdown of the marriage but, rather, her management of the equalization payment in 2008.
155Effectively requiring Mr. Slongo to pay Ms. Slongo’s debts would not promote economic self-sufficiency.
156I have reviewed Ms. Slongo’s financial statement. She will need to downsize both with respect to her residence and her desire to support those around her. Her debt load can be paid off by the sale of her home. With that, I am confident that spousal support in the amount of $5000.00 per month as of September 1, 2012 would provide the appropriate support going forward.
157Mr. Slongo should, of course, have credit for the support that he has paid to date.
158Mr. Slongo submitted that I should determine spousal support on a lump sum basis. For the following reasons, I am not prepared to do so.
159The parties’ separation agreement, as confirmed by the present order, has provisions relating to annual financial disclosure and variation. Those presume an annual consideration. I have not been asked to delete those terms.
160I do not know either party’s financial circumstances in 2015. No one knows the success of Mr. Slongo’s self-employment. Either party may suffer or have suffered another material change in circumstance.
161As a result of this decision, for the years 2012 through 2017, the parties can impute the sum of $57,000 annually to Mr. Slongo’s annual income. I can only make a determination of the support that should be payable for the years 2012, 2013, 2014 and ongoing subject to further order as described in the agreement.
(vi) Result
162Paragraph 17 of the parties’ separation agreement dated June 24, 2008 shall be amended to provide that the Respondent shall pay spousal support in the amount of $5000.00 per month commencing September 1, 2012.
Miscellaneous Issues
163Ms. Slongo argues that Mr. Slongo improperly expensed $729.40 for travel in 2012. Given the results above, I need not resolve this issue; it would not make a difference to the outcome.
164The parties should be able to work out the net outstanding for retroactive support going back to September 1st, 2012. They agree that Mr. Slongo has already paid $25,000 towards that amount. If they cannot make that determination on their own, I may be contacted to arrange a date for further argument.
165Mr. Slongo’s income increased in September of 2012 but his obligation to Jennifer did not stop until January 1, 2013. If the parties cannot agree on the amount of child support owing, I may be contacted. I would say, however, that given that Mr. Slongo has continued to assist Jennifer, there may not be an amount outstanding that is worth discussing. I leave that to the parties.
166If I have made arithmetical errors, counsel may jointly contact me.
167If the parties cannot agree on costs, written submissions may be made to me. Ms. Slongo shall make her submissions within 15 days and Mr. Slongo shall respond within 15 days thereafter. Each submission will be no more than five pages not including any Offers to Settle or Bills of Costs.
Lemon, J.
DATE: March 31, 2015