ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
KEVIN McCONNELL
Todd Jenney, for the Applicant
Applicant
- and -
MARY-PATRICIA McCONNELL
Harold Niman, for the Respondent
Respondent
HEARD: December 2, 2014, at Brampton, Ontario
Price J.
Reasons For Order
NATURE OF MOTION
1Kevin McConnell (“Ms. McConnell”) separated from his wife, Mary-Patricia McConnell (“Ms. McConnell”), on May 3, 2013, after 17 years of marriage, to form a relationship with another woman. There are two children of the marriage of Mr. and Ms. McConnell, Curran McConnell, who is 18, and Aidan McConnell, who is 14. Since the parties’ separation, Mr. McConnell has underpaid child support, has not paid any spousal support, and has not contributed to the payment of education expenses for Curran, who just began undergraduate studies at Dalhousie University in Halifax. He offers various explanations for his underpayment of support. He says that Ms. McConnell does not require his support, for the following reasons:
a) Ms. McConnell has the net proceeds of sale of the matrimonial home. (Ms. McConnell states that she bought the house with her own money and that the value of her equity in the house declined substantially over the course of the marriage.)
b) Ms. McConnell had good employment positions until 15 years ago, when Curran was born, she is capable of having such employment again. (Ms. McConnell agrees that she left a well-paying job as marketing manager for Microsoft when Aidan was born. She states that her skills, which pre-date social media, are now outdated.)
c) There is a Registered Education Savings Plan (R.E.S.P.) capable of funding at least a portion of the children’s education costs. (Ms. McConnell states that she requires Mr. McConnell’s co-operation to access the funds in the R.E.S.P., which he has failed to provide).
2Ms. McConnell has encroached on her capital since the parties’ separation, to take up the slack that Mr. McConnell has left in the support of the children, and to protect Curran from having his education interrupted by his father’s failure to pay support or contribute to the payment of Curran’s education expenses. Ms. McConnell therefore moves for interim support and for an order removing Mr. McConnell’s name from the children’s R.E.S.P., to enable her to access its contents to pay the expenses of Curran’s studies in Halifax.
3Mr. McConnell has responded with his own motion to sever his claim for divorce from Ms. McConnell’s claims for support and other remedies, so that he can “move on” with his life.
4The issues raised in the motion were too numerous, collectively, to be argued fully in under an hour, in compliance with the existing practice direction. Ms. McConnell’s factum consists of 184 paragraphs, and is accompanied by a brief of authorities, with 21 tabs. Each of the parties’ affidavits is indexed with 30 tabs, each with supporting documents. The next available date for a 3 hour motion in Brampton is in July 2015.
5It was unacceptable to require Ms. McConnell to wait seven months to have her claims for interim support determined, especially when the parties’ eldest child, Curran, is incurring education expenses, and Ms. McConnell has already been without the support she requires for a year and a half. In the hope of securing some support more quickly, Ms. McConnell’s counsel restricted his arguments to the issues of interim support, including arrears of child support, and Ms. McConnell’s access to the children’s R.E.S.P. Mr. McConnell replied to Ms. McConnell’s arguments on these issues and made his argument in support of a severance of his claim for divorce.
6On the parties’ reluctant consent, the remaining issues, including retroactive spousal support and contribution to the children’s special and extraordinary expenses, were adjourned to April 22, 2015.
BACKGROUND FACTS
7Mr. and Ms. McConnell began their cohabitation in 1996 and were married two years later, on October 11, 1998. They separated after 15 years of marriage, on May 3, 2013.
8Ms. McConnell is 55 years old; Mr. McConnell is 47. There are two children of the marriage: Curran Nelson McConnell, who is 17 (born June 15, 1997), and Aidan Shane McConnell, who is 15 (born February 1, 2000).
9When Mr. and Ms. McConnell began cohabiting in 1996, Ms. McConnell was employed by Microsoft, where she earned an annual income of $108,000. Mr. McConnell earned less than $17,000. Ms. McConnell left her employment with Microsoft in late January 2000, a few days before Aidan was born.
10From 2001 to 2010, Mr. McConnell was self-employed. He had no income from other employment. In 2002, he opened Wowy Zowy Toys, a toy store in Mississauga, for which Ms. McConnell loaned him $150,000 for his initial start-up costs. Ms. McConnell became a 50% shareholder of the business. She did the merchandising, payroll, and worked in the store at peak times at Christmas from 2002 to 2006. On October 2, 2007, she was admitted to Oakville-Trafalgar Memorial Hospital for a major depressive disorder, and stopped working for the toy store. She has remained on medication for depression from 2007 to the present time.
11When the toy store had some success in 2006, Mr. McConnell decided to open a second store, which he did in the summer of 2008. However, he failed to remit sales tax and payroll deductions. Additionally, Ms. McConnell says that he used her CIBC credit card, without her consent, to purchase inventory. Mr. McConnell denies this allegation.
12On March 11, 2009, Mr. McConnell caused Wowy Zowy to file a voluntary assignment in bankruptcy. In August 2009, he declared personal bankruptcy.
13On March 23, 2009, Ms. McConnell filed a Proof of Claim in the company’s bankruptcy, prepared by the Trustee. She later amended the amount of her claim in the Proof of Claim to $372,238.98. Ms. McConnell recovered only $4,287.02 of that amount. She says that she suffered a personal loss of $367,526 in the bankruptcy, an allegation that Mr. McConnell denies.
14In Mr. McConnell’s personal bankruptcy, he claimed furniture, personal effects, and an R.R.S.P. containing $25,000 as exempt assets. When he was discharged from bankruptcy on April 30, 2010, his personal liabilities were extinguished, while those of Ms. McConnell, including the debt she says resulted from Mr. McConnell’s unauthorized use of her credit card, remained.
15In April 2010, Mr. McConnell established a career in the solar energy business. He became Vice President of sales and Marketing for Apollo Solar Rooftop Development, receiving 4% of the shares and income based on commissions. In January 2011, he changed companies and became Major Accounts Manager for AS Solar. In 2012, he changed companies again and became Sales Director at Hanwha Solar. Simultaneously, he was employed as a consultant for which he was paid an additional $30,000 for a 4 month period.
16Beginning with an income of $45,000 in 2010, Mr. McConnell’s earnings increased to $132,500 in 2011. He reported earnings of $114,000 in 2012, which Ms. McConnell believes to be understated by about $45,000. In 2013, Mr. McConnell reported earnings of $150,519. In his most recent financial statement, sworn November 17, 2014, he reports his current earnings to be $186,483.
17On May 3, 2013, Mr. McConnell left his marriage to Ms. McConnell and formed a relationship with another woman. On February 7, 2014, he applied for a divorce, custody of/access to the children (although he does not dispute that the children have been residing primarily with Ms. McConnell since the parties separated), equalization of net family property, a freezing of Ms. McConnell’s assets, and a declaration that Ms. McConnell held ½ of the matrimonial home in trust for him.
18Ms. McConnell delivered an Answer on April 7, 2014. In it, she claims a divorce, custody of the children, child support, spousal support, and equalization of net family property. Ms. McConnell explains that she delayed applying for interim support until recently, because Mr. McConnell did not provide meaningful financial disclosure until then.
Ms. McConnell’s present financial circumstances
19In her financial statement sworn November 5, 2014, Ms. McConnell reports her total income as $425.77 per month, consisting of Child Tax Benefits (a total of $5,109.24 for the year). She states that her income in 2013 was $29,683.29, consisting of investment income of $19,683.29 and withdrawals of $10,000 from her R.R.S.P.s.
20Ms. McConnell reports expenses of $12,484.21 in 2014 ($149,810.52 on an annual basis). These consist of the following:
a) $3,059.65 for housing ($2,600 for mortgage, property insurance and repairs, and $331.35 for utilities);
b) $1,312 for household expenses including groceries;
c) $875 for clothing and personal expenses, including pharmaceuticals;
d) $6,295.96 for miscellaneous expense, including $2,152.14 for school fees and supplies, $889.12 for children’s clothing and activities, $2,835 for legal fees, and $375 for vacations.
21In her financial statement, Ms. McConnell reports that her net worth, which amounted to $2,078,740 on the date of her marriage to Mr. McConnell, declined substantially during the marriage, and over the six months following the parties’ separation on May 3, 2013, in the following respects:
c) The value of her bank accounts, savings and securities declined by $997,479, from $1,092,647 to $995,168, chiefly by the decline in the balance of her principal Royal Bank chequing account by $41,237, from $44,595 to $3,358, and the decline in the balance of her Royal Bank joint chequing account with her niece by $594 from $1,883 to $1,289, and by a decline in the balance of her Financial Margin Account with the National Bank $57,735 from $874,137 to $816,402).
a) The value of her household items and vehicles increased $17,800, from $13,470 to $31,270, chiefly by the acquisition of electronics equipment ($8,900), kitchen equipment ($700), and books ($800).
b) Her debt declined by $74,116.50, from $77,428.26 to $3,311.76, chiefly by the elimination of a contingent tax liability of $34,403 on her RRSP re-payment, and by the retirement of her share of the parties’ joint line of credit of $10,000 at the Royal Bank, and of the outstanding debt to utilities (of $1,469.27) and property tax ($297.25) and of her debts for professional services of her accountant ($9,153), dentists ($4,390), and personal loans from her sister-in-law Laura Lyons ($10,000), and from Karen Waller ($1,500).
Mr. McConnell’s present financial circumstances
22Mr. McConnell, in his financial statement dated February 7, 2014, reported that his net assets, which amounted to $23,000 on the date of marriage, increased to $33,000 by the date of separation ($43,000 in RRSP’s less $10,000 in contingent taxes at 25% on those RRSP’s).
23In the same financial statement, Mr. McConnell reported that on the date of separation, his income was $12,428.87, or $149,146.44 on an annual basis, consisting of $9,769.22 per month in employment income, before deductions ($117,230.64 per year before deductions) and $2,659.65 in commissions, bonuses, and car allowances ($31,915.80 per year). He reports that his total income was unchanged from the previous year ($149,146).
24Mr. McConnell reports expenses of $11,160.99 per month ($133,931.88 per year), consisting of the following:
a) $4,349 per month in statutory deductions;
b) $2,035 for housing ($1,630 per month for rent or mortgage and $405 for utilities);
c) $1,225 for groceries and household expenses;
d) $990 for transportation (mostly $600 for gas and oil);
e) $1,170 for personal expenses (including $300 for clothing, $300 for entertainment/recreation, and $400 for gifts);
f) $1,361 for miscellaneous expenses, including $800 for vacations, $208 for children’s activities, and $208 for musical instruments for the children.
25In Mr. McConnell’s up-dated financial statement dated November 17, 2014, he reports that his income increased by $4,379.26 over the previous nine months, to $15,540.25 ($186,483 per year), consisting of employment income of $10,807.69 and self-employment income of $4,732.56. Additionally, he reports receiving medical-dental insurance coverage having an annual value of $8,400. He now reports that his previous year’s (2013) income was $150,519, $1,372.56 higher than previously estimated.
26Mr. McConnell reports that his monthly expenses have increased to $15,455.48, keeping pace with his income. He reports increases in the following categories of expenses:
a) His statutory deductions, which were previously $4,349, are now $6,204.21.
b) His housing costs, which were previously $2,035, are now $2,405 (his rent or mortgage costs having increased from $1,600 to $2,000);
c) His groceries and household expenses, which were previously $1,225, are now $1,750;
d) His miscellaneous expenses, which were previously $1,361, are now $2,628, as they now include support for the children, in the amount of $1,267.
ISSUES
27At this time, the court will address the issues of interim child support, including arrears, interim spousal support, whether Mr. McConnell’s name should be removed from the children’s R.E.S.P., and whether Mr. McConnell’s claim for divorce should be severed from the claims for collateral remedies.
PARTIES’ POSITIONS
Ms. McConnell’s claim to compensatory spousal support
28Ms. McConnell states that she and Mr. McConnell had a traditional marriage in some ways, in that she stayed at home and cared for the children and the household. She states that she supported Mr. McConnell financially for the majority of their relationship, including when she was not employed, and that she significantly depleted her capital while doing so. She states that she was, effectively, the family’s sole source of income from 1996, when she and Mr. McConnell began cohabiting, and her salary at Microsoft was $108,000 and Mr. McConnell earned less than $17,000.
29Ms. McConnell states that she terminated her employment in late January 2000, a few days before Aidan was born, and became Aidan’s and Curran’s primary caregiver. She says that she continued to be their primary care-giver from when she and Mr. McConnell separated to September 2014, when Curran moved to Halifax to attend the University of King’s College and Dalhousie University.
30Ms. McConnell claims monthly child support in the amount of $2,018, monthly spousal support in the amount of $3,044, and an order placing the children’s Registered Education Savings Plan (“R.E.S.P.”) in her name and removing Mr. McConnell as joint trustee. She also seeks an order requiring further financial disclosure from Mr. McConnell.
31Mr. McConnell says that he has been paying child support for Aidan in accordance with the Federal Child Support Guidelines (“FCSG”) since Curran left for Halifax. He calculates the appropriate child support amount at $1,267 per month based on his 2013 income of $150,519, and he states that he is prepared to continue paying child support at this level. He disputes that he owes any arrears of child support.
32Mr. McConnell disputes Ms. McConnell’s claim for spousal support. He submits that she is receiving investment income, has withdrawn amounts from her R.R.S.P.s, and is capable of earning income based on her earlier skills in marketing. He denies that she is in need of spousal support from him or that she is entitled to support on a compensatory basis for sacrifices she made during the marriage. He asks the court to impute an income to Ms. McConnell in an amount of at least $108,000, based on the amount of her earnings at Microsoft 15 years ago.
33Mr. McConnell notes that the funds in the children’s R.E.S.P. have grown through the investment of family funds during the course of the marriage, and now amount to approximately $76,000. He submits that he and Ms. McConnell should be accessing these funds to pay the expenses of the children’s post-secondary education. He disputes the proposal Ms. McConnell has made for splitting the R.E.S.P. in parts for their two children and says that he has made reasonable requests for clarification of her proposal which she has not provided.
ANALYSIS AND EVIDENCE
a) Ms. McConnell’s claim to child support
34This proceeding was commenced pursuant to the Divorce Act (“the Act”).1 Ms. McConnell’s claim to child and spousal support is therefore derived from sections 15.1 and 15.2, respectively, of the Act. Section 15.1(3) of the Act provides that child support is to be awarded in accordance with the Federal Child Support Guidelines (“FCSG” or “the Guidelines”).2
35It is not disputed that Curran and Aidan are children within the meaning of the Divorce Act and of the Guidelines. Section 2 of the FCSG defines a “child” to mean, “a child of the marriage”. This definition incorporates section 2 of the Divorce Act:
2.(1) … “child of the marriage” means a child of two spouses or former spouses who, at the material time, …
(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.
36Based on Mr. McConnell’s income of $150,519 in 2013, Mr. McConnell is required to pay child support for two children in the amount of $2,018 per month. This obligation arose on the date of separation (May 2013).
37Mr. McConnell argues that his child support obligation should be reduced to the table amount for the support of one child, effective September 2014, when Curran began attending university in Halifax. I disagree.
38The principles applying to the determination of child support for a child who has reached the age of majority are summarized by the Manitoba Court of Queen’s Bench in Harrison v. Vargek3 and cited with approval by this Court in Haley v. Haley.4
A child who is in regular attendance at school is generally unable to withdraw from his parent’s charge or provide for himself.5
A child may therefore bring himself within the definition of a “Child of the Marriage” by pursuing the education he needs to equip himself for the future.6
“Child of the Marriage,” as defined by the Divorce Act, includes children over the age of 16 who are still pursuing their education, now considered a necessary of life.7 This includes, in some cases, post-secondary education.8
A child who has withdrawn from his studies may be reinstated to his support entitlement by bringing himself back within the definition of Child of the Marriage under the Divorce Act.9
It is a question of fact, in each case, whether a particular child remains a Child of the Marriage for support purposes.10
The FCSG direct the court, when assessing the amount of support for a Child of the Marriage, whether the child is above or below the age of majority, to use the Tables.
The presumptive rule is that basic child support for a child over the age of majority, as for minor children, is set in accordance with the Tables.11 If the court considers that approach inappropriate, it may quantify support by another means, as it considers appropriate, having regard to the child's condition, means, needs and other circumstances, as well as the financial ability of the spouses to contribute to the child's support. The onus of proving inappropriateness is on the payor.12
In addition to basic child support, the court can order the sharing of a child’s post-secondary education expenses (s. 7(1)(e) of FCSG). Such claims are subject to the discretionary tests of necessity and reasonableness.
Children pursuing post-secondary education are expected to contribute to the cost of their own studies.13 While the level of contribution is subject to debate, an adult child must bear some of the responsibility for his or her own support.14
39Curran is enrolled in an appropriate course of study. Mr. McConnell does not dispute that Curran requires financial assistance. Curran is still in a position of financial dependency. Considering the factors set out in Haley v. Haley, I find that Curran remains a child of the marriage while he is pursuing his degree. That status will continue at least until he obtains his first undergraduate degree.
40In determining the appropriate amount of child support, the court must consider section 3(2) of the FCSG which states:
Child the age of majority or over
- (2) Unless otherwise provided under these Guidelines, where a child to whom a child support order relates is the age of majority or over, the amount of the child support order is:
(a) the amount determined by applying these Guidelines as if the child were under the age of majority; or
(b) if the court considers that approach to be inappropriate, the amount that it considers appropriate, having regard to the condition, means, needs and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child. [Emphasis added]
41Having determined that Curran is a “child of the marriage”, section 3(2) requires the court to determine whether the table amount set out in the Guidelines is “inappropriate”. If it is not inappropriate, the table amount should be ordered. The Manitoba Court of Appeal provided a helpful analysis of this issue in Rebenchuk v. Rebenchuk, where it stated:
…As Bastarache J., for the court, held in Francis v. Baker, 1999 SCC 659, [1999] 3 S.C.R. 250, "inappropriate" in the context of the Guidelines means "unsuitable" rather than inadequate. This interpretation gives the court a broad discretion to accept or reject the prescribed amount of child support. In the result, while the courts' very broad discretion prior to the introduction of the Guidelines has been reduced, it has not been eliminated. There is still ample room for the "judicial fiat" under the Guidelines.
Some courts, such as those in Ontario, have held that there is a presumption that the table amount for minor children will apply with the onus of proving otherwise on the parent so asserting. See, for example, Arnold v. Washburn, 2000 ONSC 22732, [2000] O.J. No. 3653 (Ont. S.C.J.), and MacLennan. The British Columbia Court of Appeal, on the other hand (see N. (W.P.) v. N. (B.J.)), has taken the position that the table amounts plus add-ons will normally be inappropriate where an adult child is attending a post-secondary institution. This is because the table amount does not contemplate a child's contribution (which is implicit in sec. 3(2)(b) of the Guidelines and explicit in sec. 7(2)). It would appear that the Family Division in this province generally follows the Ontario approach, at least where the child lives with one of the parents and is attending the first level of post-secondary education.15 [Emphasis added; citations omitted]
42Pursuant to section 3(2)(b) of the Guidelines, if the court considers that approach to be inappropriate, it must fix the amount that it considers appropriate, having regard to the condition, means, needs, and other circumstances of the child, and the financial ability of each parent to contribute to the support of the child.
43The Court of Appeal in Lewi v. Lewi held that there is no formulaic approach to the determination of the appropriate monthly support when deviating from the table amount.16 Section 3(1)(b) directs the court to consider “the condition, means, needs and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child”.
44Curran is living in Halifax while he completes his post-secondary studies, but will likely return to Ms. McConnell’s home during the summers. It is in Curran’s interests that Ms. McConnell maintain a residence for him in her home for when he returns for Christmas, March break, and during the summers. Having regard to Ms. McConnell’s limited means, Mr. McConnell will be ordered to pay one half the table amount during the eight months when Curran attends school in Halifax, and the full table amount during the four summer months, when he resides with his mother.
b) Ms. McConnell’s claim to spousal support
i) Ms. McConnell’s entitlement to spousal support
45Section 15.2 of the Divorce Act governs both interim and final spousal support orders. Section 15.2(4) sets out factors the court must consider when making an interim or final order for spousal support. It provides:
15.2 (4) In making an order under subsection (1) or an interim order under subsection (2), the court shall take into consideration the condition, means, needs and other circumstances of each spouse, including
(a) the length of time the spouses cohabited;
(b) the functions performed by each spouse during cohabitation; and
(c) any order, agreement or arrangement relating to support of either spouse.
46The objectives of an order for spousal support apply to both interim and final orders. They are summarized in s. 15.2(6) of the Act. That section provides:
15.2 (6) An order made under subsection (1) or an interim order under subsection (2) that provides for the support of a spouse should,
(a) Recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;
(b) apportion between the 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 spouses arising from the breakdown of the marriage; and
(d) Insofar as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.
47The importance of each of the factors outlined above varies from case to case. This necessitates a contextual approach. In Driscoll v. Driscoll, Lemon J. enumerates a list of principles governing interim spousal support:
(1) On applications for interim support, the Applicant’s needs and the Respondent’s ability to pay assume greater importance;
(2) An interim support order should be sufficient to allow the Applicant to continue living at the same standard of living enjoyed prior to separation, if the payor’s ability to pay warrants it;
(3) In motions for interim support, the court does not embark on an in depth analysis of the parties’ circumstances, which is better left to trial. The court achieves rough justice at best;
(4) The courts should not unduly emphasize any one of the statutory considerations above others;
(5) On motions for interim support, the need to achieve economic self-sufficiency is often of less importance;
(6) Interim support should be ordered within the range suggested by the spousal support advisory guidelines unless exceptional circumstances indicate otherwise;
(7) Interim support should only be ordered where it can be said a prima facie case for entitlement has been made out; and
(8) Where there is a need to resolve contested issues of fact, especially those connected with a threshold issue, such as entitlement, it becomes less advisable to order interim support.17
48Applying the above principles to my contextual analysis, I find that Ms. McConnell has made out a prima facie case for entitlement. My determination of her entitlement is based on her need and Mr. McConnell’s ability to pay. The amount of support I am ordering is within the range suggested by the Spousal Support Advisory Guidelines (the “Advisory Guidelines” or “the Guidelines”) and is designed to allow Ms. McConnell to live at the same level as before the parties’ separation, to the extent that Mr. McConnell’s ability to pay warrants it.
(a) Criteria for Entitlement – Ms. McConnell’s needs
49I will deal with each of the relevant factors and objectives, mindful of the admonition that no one objective predominates; rather, all four objectives must be balanced in the context of the circumstances of the particular case.18 After this, I will balance the considerations that emerge to determine an appropriate quantum of support.
(b) Factors: 15.2 (4)
- 15.2 (4)(a) Length of the cohabitation
50The “condition, means, needs and other circumstances of each spouse” includes the length of the parties’ cohabitation. I take into consideration that Mr. and Ms. McConnell were together for 15 years. Ms. McConnell is 55 years old and has a dependent child at home. It is likely that Ms. McConnell’s need for spousal support will continue until Aiden is independent. Aiden, who is now 15 (born February 1, 2000), will likely continue to reside with his mother at least until he completes high school. Curran returns to his mother’s home when on holiday from his studies in Halifax.
- 15.2(4)(b) Functions performed during cohabitation
51I find that Ms. McConnell assumed primary responsibility for the household and the children during the marriage. She left her employment when Aidan was born and has continued to regard providing logistical support to him and to Curran as her principal occupation. Until Curran began post-secondary studies in Halifax in September 2014, she drove him to his music classes in the east end of Mississauga and drove Aidan to his school in the west end of the city.
52Mr. McConnell states that he has always been deeply involved in the children’s lives and was a volunteer in Curran’s kindergarten class on alternate Mondays and a frequent volunteer at both children’s schools for daytrips and events. He was also the soccer coach for their childhood teams. He continues to be active with them in hiking, skiing, biking, snowboarding, tennis, and fishing. Nevertheless, he does not dispute Ms. McConnell’s assertion that she was the primary caregiver for the children. As noted above, Ms. McConnell estimates that Curran has spent 14% of his time with Mr. McConnell since the parties separated, and that Aidan has spent 16% of his time with Mr. McConnell.
53Mr. McConnell acknowledges that Ms. McConnell assumed primary responsibility for the family finances, with the exception of the period from October 2007, when she was hospitalized for depression, until Mr. McConnell declared personal bankruptcy two years later.
54Ms. McConnell provided the parties’ matrimonial home throughout their marriage. In October 2007, before the McConnells were married, she bought the property at 7 Royal York Road in Etobicoke, which later became their home. In May 2009, she bought the property at 746 Bexhill Road, paying the down payment, land transfer and closing costs, and bridge financing the purchase. In August 2006, she sold the Bexhill property and bought the property at 1548 Marshwood Place in Mississauga where the parties resided until they separated. I find that Ms. McConnell assumed principal responsibility for the household, although Mr. McConnell also performed household tasks.
- 15.2(4) Other Circumstances
55The parties have not relied on other circumstances, with the exception that Mr. McConnell says that he has paid some of Ms. McConnell’s expenses since the parties separated. Ms. McConnell says that she has received no support from Mr. McConnell. Mr. McConnell says that he has paid Ms. McConnell’s cell phone charges, but he has not provided details of his payments or evidence of them. I am unable, without this information, to assess their importance or amount. The trial judge can take them into account at trial based on a more complete evidentiary record.
56I now turn to consider the objectives set out in s. 15.2(6).
(c) Objectives: Section 15.2(6)
- 15.2(6)(a) - Economic advantages or disadvantages from the marriage or its breakdown
57The concept of economic advantage or disadvantage arising from the marriage is the foundation for the principle of compensatory support.19 In the present case, the parties formed a relationship of financial interdependence when Ms. McConnell left her employment at Microsoft and devoted herself to the parties’ children. She enabled Mr. McConnell to pursue his business venture at Wowy Zowy Toys and, later, to establish and advance in his career in the sale of solar energy products, at the expense of her own. This was no doubt an economic advantage to Mr. McConnell and a disadvantage to Ms. McConnell.
58The economic disadvantage to Ms. McConnell that has resulted from the marriage breakdown is more pronounced, having regard to the fact that she gave up her career at Microsoft, which would otherwise have been a source of security for her future. Ms. McConnell incurred personal debts in connection with Wowy Zowy Toys, which eroded the net family property that could have stood in place of what might have been a retirement pension had Ms. McConnell continued at Microsoft.
- 15.2(6)(c) Economic hardship
59It is also necessary to consider whether Ms. McConnell suffered economic hardship from the marriage breakdown. There appears to be ongoing uncertainty about whether ‘hardship’ refers to an inability to meet basic needs, or should be more liberally interpreted to refer to an inability to meet the recipient’s needs considered in their context.20
60In this case, Ms. McConnell has avoided suffering “hardship” by drawing from her capital, including her R.R.S.P. investments, to provide for her needs and those of the children. If defined liberally, she may yet suffer the economic hardship of a significant reduction in her standard of living.
61While it may be preferable to consider hardship in the context of the particular parties, I need not determine that issue at this stage. The circumstances of the parties may change between now and the time of trial, and the trial judge will be better situated to make a finding as to whether economic hardship has resulted from a reduction in Ms. McConnell’s standard of living under the objective of self-sufficiency.
- 15.2(6)(d) Self-sufficiency
62In Hotte v. Robertson, MacDougall J. set out a four-step analysis to determine the parties’ needs and means on an interim motion for support. He stated:
In reviewing the needs of the Applicant, the motions judge was advised that Ms. Hotte was not employed and was receiving government assistance and that her ability to earn income was limited as she had not been employed outside the home for a considerable period of time.
The court should not, at an interim application stage, place too much emphasis on the submission by the payor spouse of the dependant spouse’s failure to pursue self-sufficiency. It is apparent that Ms. Hotte has an obvious need and her proposed budget is a relatively modest budget.21 [Emphasis added]
63The principle that MacDougall J. articulated above was followed by O’Connor J. in Ferreira v. Ferreira,22 and by Platana J. in Wilson v. Wilson.23
64While the objective of self-sufficiency is a factor which must be considered whenever determining the appropriateness and quantum of spousal support under the Family Law Act, Ms. McConnell’s failure to pursue or achieve self-sufficiency is not a significant factor in the determination of her entitlement at this interim stage of the proceeding.
65Section 15.2(6)(d) of the Divorce Act promotes the objective of economic self-sufficiency only if it is “practicable” to do so and where the objective can be realized “within a reasonable period of time”. As the Court of Appeal pointed out in Fisher v. Fisher, self-sufficiency, with its connotation of economic independence, is a relative concept. It should be interpreted not as the ability to meet basic expenses, but as the ability to support a standard of living that is reasonable, having regard to the economic partnership that the parties enjoyed and could sustain during cohabitation and could reasonably anticipate afterward. It requires consideration of:
The parties’ present and potential incomes;
Their standard of living during cohabitation;
The efficacy of any suggested steps to increase a party’s means;
The parties’ likely post-separation circumstances (including the impact of equalization of their property);
The duration of their cohabitation; and
any other relevant factors.24
66The Court of Appeal stated in Linton:
Self-sufficiency is often more attainable in short-term marriages, particularly ones without children, where the lower-income spouse has not become entrenched in a particular lifestyle, or compromised career aspirations. In such circumstances, the lower-income spouse is expected either to have the tools to become financially independent or to adjust his or her standard of living.
In contrast, in most long-term marriages, particularly in traditional long-term ones, the parties’ merger of economic lifestyles creates a joint standard of living that the lower-income spouse cannot hope to replicate, but upon which he or she has become dependent. In such circumstances, the spousal support analysis typically will not give priority to self-sufficiency because it is an objective that simply cannot be attained.25
67L’Heureux-Dubé J. stated in Moge: “The longer the relationship endures, the closer the economic union, the greater will be the presumptive claim to equal standards of living upon its dissolution.”26
68Although the doctrine of spousal support, which focuses on equitable sharing, does not guarantee to either party the standard of living enjoyed during the marriage, this standard is still relevant to support entitlement.27 Furthermore, great disparities that would result in the spouses’ respective standards of living in the absence of support are often a revealing indication of the economic disadvantages inherent in the role that one of the parties assumed during the marriage.
69Ms. McConnell’s financial dependence on Mr. McConnell increased when his earnings and their standard of living improved following his transition to the solar energy industry. There is no reasonable prospect that Ms. McConnell will achieve a standard of living similar to that which she and Mr. McConnell shared before their separation, and that he has continued to maintain for himself since the parties separated.
70The goal of self-sufficiency for Ms. McConnell is not practicable at the present time, having regard to her limited income-earning capacity, at least until Aidan has begun post-secondary studies, or until he and Curran become financially self-sufficient themselves.
71In Thomas v. Thomas, it was held that the onus was on the wife to establish that she was not intentionally under-employed.28 In considering the capacity of the wife in Thomas to contribute to her own support as required by s. 33 (9) (c) of the Family Law Act,29 Quinn J. indicated that the spouse seeking support bore “an evidentiary responsibility, not necessarily to show that reasonable efforts have been made to become self-supporting, but to establish that some reasonable steps have been taken”. In that case, the wife did not work, and the judge imputed income to her on the basis that she had not made adequate efforts and had failed to present a plan for her own support.
72In Mann v. Mann, Herman J. distinguished the Thomas case on the basis that the issue was not one of underemployment but whether reasonable efforts had been made to become self-supporting.30 The evidentiary onus in Thomas, he said, was to establish “that some reasonable steps have been taken”.
73When applying the Advisory Guidelines, the court must, in addition to the formulae, consider the following:
a) Entitlement;
b) Location with the range;
c) Restructuring;
d) Ceilings and floors;
e) Exceptions; and
f) Other miscellaneous issues.31
74In the present case, where the spousal support awarded may be varied by the trial judge, it is not appropriate to apply the Guidelines as a software tool or formula for determining the specific amount and duration of support to be paid to Ms. McConnell. The Guidelines must be considered in context, and applied in their entirety, with specific consideration of any applicable variables. Their use must be moderated, where necessary, in order to prevent them from becoming instruments of unfairness.
75In particular, applying the Advisory Guidelines may result in injustice where the court seeks to apply them in circumstances where the length of the marriage and the ongoing care responsibilities of the mother make it appropriate for the court to apply compensatory considerations. the Guidelines state:
During the feedback process we did hear criticisms in some parts of the country that the amounts produced by the formula in shorter marriage cases were "too low". In some of these cases, there was a failure to consider the compensatory exception — the exception for disproportionate compensatory claims in shorter marriages. In these cases, one spouse may have experienced a significant economic loss as a result of the marriage, by moving or by giving up employment, for example.
76The Guidelines itemize a series of exceptions which, although not exhaustive, are intended to help lawyers and judges frame and assess departures from the formulae. The exceptions allow appropriate consideration of the factual circumstances in individual cases. The exceptions listed include:
a) compelling financial circumstances in the interim period; and
b) circumstances where hardship would result from applying either the “without child support” or the “custodial payor” formulae.
77The question for the trial judge in the present case, in relation to this objective, will be how quickly it is reasonable to expect Ms. McConnell to adjust her standard of living to one commensurate with her own income-earning ability. The answer will depend on a balancing of all the objectives and factors, in the context of the circumstances that exist at the time of trial.
- Summary of objectives
78In summary, Ms. McConnell is a 55 year old spouse, separated in 2013 after a mid-length marriage, who has suffered an economic disadvantage arising from the marriage by having assumed child care responsibilities and household duties in a way that compromised her career to the advantage of her husband. Her inability to achieve a greater degree of self-sufficiency at this stage, having regard to the marital standard of living and the continued dependence of her younger children on her, do not disentitle her to spousal support at the present time and are not likely to do so at trial.
79While Curran and Aidan were both in full-time attendance at school when the parties separated, they had continuing need for their mother’s logistical support. Curran attended the music program as part of the Regional Arts Program at Cawthra Public School in southeast Mississauga and Aidan attended school in the west end of the City. It was necessary for Ms. McConnell to transport Curran to his school in southeast Mississauga, as he was required to carry up to three musical instruments to school each day and was unable to do so using public transportation, and to transport him to Oakville, where he attended for psycho-educational assessments.
80As noted above, Curran entered post-secondary studies in Halifax in September 2014 and needed help moving into his dormitory and getting established at university. Aidan is still attending high school. It is reasonable that both boys should require ongoing help from their mother at this time.
81For the foregoing reasons, I find Ms. McConnell to be entitled to receive interim spousal support from Mr. McConnell. I will now turn to consider the amount of support to be paid. This inquiry must begin with a consideration of Ms. McConnell’s income.
c) Should employment income be imputed to Ms. McConnell for purposes of determining her entitlement to spousal support?
82Mr. McConnell submits that the court should impute to Ms. McConnell an income of at least $108,000, based on the amount she was earning when she left her employment with Microsoft 15 years ago, when Aiden was born. I do not agree.
83Imputing income is a method prescribed by s. 19 of the Federal Child Support Guidelines for calculating a spouse’s income, in order to determine the joint and ongoing obligation of parents to support their children and each other.32 Section 19 applies where the methods set out in section 15 to 18 of the FCSG do not produce a fair result; that is, where the parties have not agreed on the amounts of their respective incomes, and where basing the determination of income of the spouse’s total taxable income for the most recent year for which income tax information is available, or the average of the previous three years’ income, if the spouse’s income has fluctuated, does not produce a fair result. The imputation of income in these circumstances is intended to ensure that separated spouses comply with their obligation to financially support their children and, where appropriate, each other, and that they do not avoid that obligation by a self-induced reduction of income.33
84The Supreme Court in Drygala set out a three-part test to determine whether income should be imputed. The first part of the test is to ask whether the spouse is intentionally under-employed or unemployed; the onus is on the party alleging intentional unemployment or under-employment to prove that fact. He/she must provide an evidentiary basis for this finding.34
85If a spouse has made an unreasonable choice to earn less than he or she is capable of earning, the spouse is deemed to be intentionally under-employed. The issue is therefore whether the fact that the spouse is earning less income than he or she is theoretically able to earn resulted from actions that were both voluntary and reasonable. When an employment decision results in a significant reduction of child support by the payor, or a significant increase in need for spousal support by the recipient, it needs to be justified by compelling evidence.35 It must be reasoned, thoughtful, and highly practical.36
86In assessing how much income to impute to a spouse, the court must have regard to the payor’s capacity to earn income in light of such factors as employment history, age, education, skills, health, available employment opportunities, and the standard of living earned during the parties’ relationship. The court looks at the amount of income the party could earn if he or she worked to capacity.37
87Ms. McConnell was forty years old fifteen years ago, when she was employed at Microsoft and earned $108,000 per year. What caused her to terminate that employment at that time was that Aidan, the McConnell’s youngest son, was due to be born and the McConnells apparently decided that he and Curran, who was then turning 3 years old, required Ms. McConnell’s attention at home. Although Ms. McConnell left her employment voluntarily, it is not disputed that she and Mr. McConnell made the decision that she do so together, and considered it a reasonable decision at the time.
88Ms. McConnell is now 55 years old and has essentially been unemployed for 15 years. In the intervening period, her employment was almost exclusively in Mr. McConnell’s toy store business, which ultimately led to bankruptcy in 2009. Even before that time, Ms. McConnell had withdrawn from active involvement in the business owing to her hospitalization for a major depressive disorder in October 2007. Mr. McConnell does not dispute that Ms. McConnell suffered from depression, or that this led to her withdrawal from employment in his business at that time, or that she continues to suffer from depression, which she currently manages with medication. Ms. McConnell’s depression, as a cause of her unemployment, was not voluntary, and is a reasonable explanation for the interruption in her employment outside the home.
89In support of his argument that Ms. McConnell is capable of earning income at the level she earned when she left Microsoft in 2000, Mr. McConnell relies on the fact that Ms. McConnell’s Linked-In Profile describes her as an Independent Consultant and District Manager with Arbonne International Canada. Mr. McConnell acknowledges that Ms. McConnell discloses her gross business income from that company in her 2013 income tax return, but he has not offered any evidence that would support a finding that she is deriving a net income from that employment. Similarly, Ms. McConnell describes herself as having held a position as President of Visionerum from 2008 to 2012. Neither party suggests that she has earned taxable income from that employment, or that she gained marketable skills there.
90Microsoft, the company that employed Ms. McConnell from 1991 to 2000, is a manufacturer of computer software. It is well known that Microsoft operates in an industry that is highly sensitive to changes in technology. Many generations of Microsoft’s products have come and gone since Ms. McConnell was employed there. The year she left, Windows 2000 was just being released; Windows XP Professional had not yet been released. A year later, Windows 95 stopped being sold. Windows 7 did not appear for 9 years; Windows 9, for 11 years. Internet Explorer 7 was six years in the future; Explorer 9, eleven years. When Ms. McConnell left, Twitter had just come online, and Google had just become the world’s largest search engine. Facebook was three years in the future, Microsoft MSE, nine years. It is a reasonable inference that in the technology industry, the knowledge and skills that Ms. McConnell possessed when she left Microsoft in 2000 would no longer be marketable today, at least without re-training.
91Having regard to Ms. McConnell’s current age (55), her employment history (last employed 15 years ago), health (major depressive disorder), family circumstances (separated in May 2013, and currently having the care of her youngest son, Aidan, who is 15), and in the absence of evidence that meaningful employment is available to her, I am not prepared at this stage of the proceeding to impute an income to Ms. McConnell.
d) Should Ms. McConnell’s RRSP withdrawals be included in her income?
92Section 16 of the FCSG provides that a spouse’s annual income for child support purposes is determined using the sources of income set out under the heading “total income” in the T1 General form issued by the Canada Revenue Agency as adjusted in accordance with Schedule 3.
93In Fraser v. Fraser, the Court of Appeal for Ontario held that R.R.S.P. income is presumptively part of a spouse’s income for child support purposes, since R.R.S.P. income is included in “total income” on the T1 General form.38 In Ludmer v. Ludmer, however, the Court held that the inclusion of R.R.S.P. withdrawals in income is not mandatory; rather, the Court has discretion in appropriate circumstances not to include them.39 This discretion is derived from s. 17(1) of the FCSG which states:
17(1) If the court is of the opinion that the determination of a spouse’s annual income under s. 16 would not be the fairest determination of that income, the court may have regard to the spouse’s income over the last three years and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years.
94An R.R.S.P. is a form of saving, derived from income, and taxable when withdrawn. Withdrawals may fund living expenses. In these respects, R.R.S.P. savings possess characteristics of income. On the other hand, funds in an R.R.S.P. account generate income which is tax-sheltered until withdrawn, at which time it is taxed, sometimes at a lower marginal tax rate than the one that applied to the taxpayer when the contributions were made to the plan. At the time when spouses separate, the funds held in R.R.S.P. accounts are an included amount when calculating net family property for the purposes of determining whether an equalization payment is owed. In these respects, R.R.S.P. savings possess characteristics of capital.
95In Laurain v. Clarke, I reviewed the legislation, and the jurisprudence interpreting it, for the purpose of determining whether annuity payments received by a payor spouse should be included in his income for purposes of determining his obligation to pay support. I stated:
Neither the Federal Child Support Guidelines nor the Advisory Spousal Support Guidelines define what forms of receipts are to be included in income, when income is imputed pursuant to section 19 of the Child Support Guidelines. Based on the review that follows, I find that the court has identified the following factors, most of which help distinguish between income and capital, that the court should consider when deciding whether a given receipt should be included in income for the purposes of calculating child or spousal support:
(a) Is the amount included in income for purposes of income tax?
(b) Is the amount capital that generates income?
c) Is the amount, if capital, compensation for loss of income?
d) Has the amount, if capital, been equalized, or is it exempt?
(e) Is the payment of the amount gratuitous?
(f) Is the payment of the amount recurrent?
(g) Were the funds typically used to finance a significant proportion of the recipient’s living expenses?40
96Some of these same questions can also be helpful to consider when determining whether R.R.S.P. withdrawals should be included in the income of a spouse for support purposes. Ms. McConnell was required to include her R.R.S.P. withdrawals in her income in 2013 for purposes of income tax. They therefore form part of her total taxable income and therefore, pursuant to s. 16 of the FCSG, they are presumptively income for child and spousal support purposes. Additionally, Ms. McConnell used the amounts withdrawn to finance her and her children’s living expenses at a time when she was not employed, and was not receiving sufficient investment income to sustain her and her children, and was not receiving child or spousal support from Mr. McConnell.
97In Foley v. Weaver, MacPherson J., when determining a payor spouse’s income for child support purposes, excluded $5,000, which the payor had withdrawn from his R.R.S.P. to cover the cost of a broken sewage pipe, from his income, which was otherwise approximately $63,000, on the basis that it was a one-time withdrawal, for a specific purpose, not a recurrent payment that was used for routine living expenses.41
98In Stevens v. Boulerice, Aitken J. declined to exclude R.R.S.P. withdrawals from a payor spouse’s income when the contents of the R.R.S.P. as a whole had been the subject of an equalization calculation.42 She noted that s.16 of the FCSG requires that R.R.S.P. withdrawals be included as income for child support purposes. She noted that Schedule III to the FCSG, which provides special rules for adjustments to income for child support purposes in certain cases, does not make any special provision for R.R.S.P. income. She said that she could see no reason why an available source of income to fund child support should be excluded because of the dealings between the parents with regard to equalizing their net family property. She observed that child support was not being paid to increase the mother’s lifestyle. The Ontario Court of Appeal, in Fraser,43 agreed with this reasoning.
99In Fraser, the payor spouse withdrew approximately $153,000 from an R.R.S.P. to buy a home. Where the payor was not working and his first obligation was to ensure that his children were properly supported, the Court of Appeal held that including his R.R.S.P. withdrawals in his income did not create unfairness. The Court in Fraser noted that the view that non-recurring withdrawals from R.R.S.P.s should automatically be excluded from income for child support purposes has been superseded by amendments to the s.17 and by the jurisprudence in cases such as Stevens v. Boulerice.
100In Warsh v. Warsh, Lauwers J., as he then was, stated, “I do not consider the R.R.S.P. withdrawals to be income for spousal support purposes. The drawdown of R.R.S.P.s is clearly not sustainable.”44 I agree with Lauwers J.’s rationale and find it apt in the present case. Ms. McConnell’s withdrawals from her R.R.S.P. accounts are not indefinitely sustainable and are not likely to continue for a substantial period of time.
101It is reasonable to characterize annual withdrawals from an R.R.S.P. by a retiree as income when he deposited the funds at an earlier time, when his need for income was lower and the amount of his income and marginal tax rate were higher, with the intention of deferring his income tax on the funds to later, when his need for income is greater and his income and marginal tax rate are lower. The funds are then deferred income.
102It is another thing to attribute income to someone, like Ms. McConnell, who makes an urgent withdrawal once, or sporadically, in spite of a “tax penalty”, to bridge a gap in income caused by circumstances beyond his/her control. The circumstances of such a withdrawal make it more closely analogous to a liquidation of capital, or a loan.
103Once spouses have separated, the contents of their respective R.R.S.P. accounts are treated as capital for the purpose of an equalization payment. Like an annuity or payment from a structured settlement, whose capital amount has been taken into account as net family property, the interest the fund generates should be treated as income, but the fund itself should not, except in exceptional circumstances, such as those outlined in Laurain v. Clarke.
104It makes no sense to include in Ms. McConnell’s income the withdrawals she made from her R.R.S.P., made necessary by the fact that she was not receiving timely payments of child and spousal support, and thereby diminish the spousal support she receives in the future, when she no longer receives income from the R.R.S.P. Taking such an approach would result in a support amount that is premised on an unrealistically high income.
105In the present case, I am not including the $10,000 that Ms. McConnell withdrew from her R.R.S.P. in 2013 in her income for the purpose of determining the spousal support payable to her in 2014. It is true that the funds in Ms. McConnell’s R.R.S.P. represents income that she earned in previous years, and that withdrawals are presumptively part of income for child support purposes under the FCSG, subject to the discretion that the court may exercise under s. 17(1) of the FCSG.
106Additionally, fluctuations in Ms. McConnell’s income resulting from her R.R.S.P. withdrawal could be taken into account by applying the averaging provision in section 17(1) of the FCSG, which contemplates averaging the last 3 years’ income where there is fluctuation in a party’s income. However, for the reasons stated above, proceeding in this manner would not produce a fair determination of Ms. McConnell’s income.
107The substantial R.R.S.P. withdrawal that Ms. McConnell made in 2013 is explained by the parties’ recent separation, and by the fact that Mr. McConnell was not providing adequate support for Ms. McConnell and the parties’ children. Like Foley, it was a one-time withdrawal for the specific purpose of bridging the gap between the parties’ marriage and the making of adequate provisions for interim support. Including Ms. McConnell’s R.R.S.P. withdrawal in her income would unfairly distort her actual income and thus her need for ongoing support.
108Additionally, the 2013 withdrawal is inconsistent in amount with Ms. McConnell’s prior transactions in relation to her R.R.S.P., which were designed to create savings for future retirement. Such anomalous withdrawals support a characterization of these withdrawals as “one-time”.
109The amount in Ms. McConnell’s R.R.S.P. account on the date of separation will be included in her net family property for purposes of calculating the equalization payment that one of the parties owes to the other. While the income earned by this asset in the future may properly be taken into account in computing Ms. McConnell’s income for the purpose of determining her entitlement to support, it would not be reasonable to include the 2013 withdrawal itself in her income for this purpose.
110The range of spousal support based on Mr. McConnell’s income of $150,519 in 2013 and Ms. McConnell’s income (apart from R.R.S.P. withdrawals) of $19,683.29, following a 15 year marriage leading to separation at age 55, is from $2,379 to $3,170 with a mid-point of $2,773. Ms. McConnell has established her need for spousal support on a balance of probabilities based on her monthly expenses of $12,000.
111Based solely on the duration of the marriage, and the length of time Ms. McConnell has been absent from the work force, spousal support at the mid-point of the Advisory Guidelines would be appropriate. In the circumstances of the present case, including the sacrifice of her position at Microsoft that Ms. McConnell made, the indebtedness she incurred to enable Mr. McConnell to embark on his toy business, the challenges she would face seeking employment, and her younger child’s need for her continued support, compensatory considerations require the amount to be increased to the high end of the range.
112Over the course of the marriage, Ms. McConnell’s net worth declined by $710,041, from $1,816,158 on the date of marriage (when her assets were $2,155,877.26 and her liabilities were $262,291.00) to $1,028,688.74 on the date of separation (when her assets were $1,106,117.00 and her liabilities were $77,428.26). Six months later, her net assets had further declined by an additional $5,562.74 to $1,023,126 (assets of $1,026,438 and liabilities of $3,311.76).
113Over the course of the marriage, Mr. McConnell’s net worth increased by $20,000, from $23,000 on the date of marriage, to $43,000 on the date of separation. Mr. McConnell deducts 25% from the value of the R.R.S.P. amounts as notional taxes on the withdrawal of the funds. At the present time, however, the R.R.S.P.s are intact, and Mr. McConnell has offered no evidence to suggest that he will have occasion to withdraw their contents in the foreseeable future.
114Ms. McConnell’s real income (leaving aside withdrawals from her R.R.S.P.) has declined by approximately $100,000 over the course of the marriage, from $108,000 on the date of marriage to $5,109.24 in November 2014. In the same period, Mr. McConnell’s income increased by $168,465.76, from $17,000 on the date of marriage to $185,465.76 as of November 2014.
115Based on Ms. McConnell’s decrease in net worth, and in income, and Mr. McConnell’s increase in net worth, and in income, and Ms. McConnell’s continued responsibilities for Aidan, I find that she is entitled to interim spousal support at the upper end of the Advisory Guidelines. The upper end of the range is $3,170. I am rounding this amount down to $3,000.
Transfer of the R.E.S.P.45
116Ms. McConnell asks that Mr. McConnell be removed as a joint trustee from the R.E.S.P. that she established for the benefit of Curran and Aidan. The R.E.S.P. at National Bank Financial, held, on the date of separation, and still holds, $76,048.
117The Family Law Act contains a comprehensive array of provisions for determining the spouse’s rights and obligations in relation to each other, including rights and obligations pertaining to property. Section 10 provides, in this regard:
- DETERMINATION OF QUESTIONS OF TITLE BETWEEN SPOUSES –
(1) A person may apply to the court for the determination of a question between that person and his or her spouse or former spouse as to the ownership or right to possession of particular property, other than a question arising out of an equalization of net family properties under section 5, and the court may,
(a) declare the ownership or right to possession;
(b) if the property has been disposed of, order payment in compensation for the interest of either party;
(c) order that the property be partitioned or sold for the purpose of realizing the interest in it; and
(d) order that either or both spouses give security, including a charge on property, for the performance of an obligation imposed by the order,
and may make ancillary orders or give ancillary directions.
118An R.E.S.P. is not property belonging to or in the possession of either spouse. At the end of 2004, the Canada Education Savings Act, (“CESA”), enacted in 2004, repealed the Canadian Education Savings Grant (“C.E.S.G.”) regulations under the Department of Human Resources Development Act (Canada), revised the C.E.S.G. program, and introduced the Canada Learning Bond to help low income families with contributions to registered education savings plans (“R.E.S.P.”).46
119Ms. Florence Carey, in her article on R.E.S.P.’s in the Estates Trusts and Pensions Journal, describes the R.E.S.P. investment vehicle in the following way:
An R.E.S.P. is a contractual arrangement between a "subscriber" and a "promoter". A "subscriber" is an individual (other than a trust), or such an individual and his or her spouse or common law partner, or a public primary caregiver of a child, who wishes to contribute towards the post-secondary education of a "beneficiary", usually the child or grandchild of the subscriber. A "promoter" is a person or organization which obtains the approval of the Canada Revenue Agency ("CRA") to operate the R.E.S.P., and agrees to pay or to cause to be paid "educational assistance payments" to or for one
or more beneficiaries under the R.E.S.P. In the case of a "non-family
plan", the subscriber may name only one beneficiary, without
restriction as to who that beneficiary may be. In the case of a "family
plan", there may be more than one beneficiary, provided that each
beneficiary is connected by blood or adoption to each living subscriber under the plan or was so connected to a deceased original subscriber. Group plans also exist.47
120The purpose of an R.E.S.P. is to accumulate savings for use by the "beneficiary" of the R.E.S.P. in paying expenses related to postsecondary education.
121Although Ms. Carrey’s article describes the relationship between the subscriber and the promoter as contractual, it does not explain the relationship between the subscriber parent, who holds title to the R.E.S.P. account, and the beneficiary child.
122The R.E.S.P. is the product of a trust relationship. It is a trust fund held by the trustee, who is the administrator of the R.E.S.P., on behalf of the children, who are its beneficiaries. An express trust is made out where the three certainties are met, namely, intent, subject matter, and objects. In Henry v Henry, the Ontario Court of Appeal invoked the Waters’ text, Law of Trusts in Canada (2nd ed.). The Court stated:
For the trial judge to determine the existence of a valid trust, it was necessary that he apply the facts which he found to be the essential characteristics of a trust, which are often referred to as "the three certainties". The essential characteristics of a trust are described in the following passage in D.W.M. Waters, Law of Trusts in Canada, 2nd ed. (Toronto: Carswell, 1984), at p. 107:
For a trust to come into existence, it must have three essential characteristics. As Lord Langdale M.R. remarked in Knight v. Knight, in words adopted by Barker J. in Renehan v. Malone and considered fundamental in common law Canada, first, the language of the alleged settlor must be imperative; second, the subject matter or trust property must be certain; third, the objects of the trust must be certain. This means that the alleged settlor, whether he is giving the property on the terms of a trust or is transferring property on trust in exchange for consideration, must employ language which clearly shows his intention that the recipient should hold on trust. No trust exists if the recipient is to take absolutely, but he is merely put under a moral obligation as to what is to be done with the property. If such imperative language exists, it must, secondly, be shown that the settlor has so clearly described the property which is to be subject to the trust that it can be definitively ascertained. Third, the objects of the trust must be equally clearly delineated. There must be no uncertainty as to whether a person is, in fact, a beneficiary. If any one of these three certainties does not exist, the trust fails to come into existence or, to put it differently, is void.48 [Emphasis added]
123It is not necessary for the court to find “any technical words or expressions for the creation of a trust”.49 Instead, all that is needed is that the intention to create a trust can be inferred with certainty. The funds, while in the R.E.S.P., are impressed with an express trust because they are paid by the settlor/subscriber (the depositor, and the Government, with regard to their respective contributions) for the specified purpose of the children’s education. The Children are the objects of the trust with the provision that the proceeds be used for an educational facility that is acceptable and is a qualifying or specified educational institution under the R.E.S.P. program. When the account is set up, it is an express term that the funds will be advanced on behalf of the child to the qualifying or specified educational facility, as allowed by the Government of Canada. The R.E.S.P. monies are advanced by a settlor to an account whose title is held by the trustee who may also be the subscriber. If the child does not end up using the R.E.S.P. monies, the trust fails, or is exhausted, and the funds revert to the settlor.50
124At the time the parent(s) (or anyone else who advances money to create an R.E.S.P.) sets up an R.E.S.P. for their child, it is their intention at that time that matters in determining whether the certainty of intent to establish a trust exists. The intention is that the funds advanced be used on behalf of the child for his or her education and at that point, the trust interest crystallises. The fact that after the trust has been created, a parent can then withdraw moneys from the R.E.S.P. does not take away from the fact that it is a trust. A trustee can always breach a trust and withdraw proceeds. The fact that a party is not aware that this is wrong does not make it any less a breach of trust. Where parents seize R.E.S.P. funds after the account has been constituted, they run the risk of being removed as a trustee and of being found liable for breach of trust.
125There is no particular phraseology commonly accepted in the law of trusts to distinguish between trusts that are for the purpose of achieving a family purpose and ones that serve a business purpose. The authors of Waters on The Law of Trusts in Canada (4th Edition, 2012) state:
The object of the particular trust may have as its ultimate purpose the well-being of an individual, as in a registered retirement savings plan, or it may be exclusively concerned with the furtherance of a commercial enterprise, as when a partnership buy-sell agreement is funded with insurance held by a trustee on agreed terms.51
126In Hockey-Sweeney v. Sweeney, the Court of Appeal held that once a spouse has placed assets into a trust for the benefit of his or her children, the spouse ceases to have any interest in them or control over such assets, and they are excluded from the equalization process.52 The trustee controls the trust. The court held that the children were the beneficiaries of the trust and, therefore, the assets in the trust.
127For the reasons that follow, I find that Ms. McConnell established the R.E.S.P. as a trust on behalf of the parties’ two children for the purpose of their education.
128Ms. McConnell opened an R.E.S.P. in 2003 when Curran was 6 years old and Aidan was 3. She was the only contributor to the R.E.S.P. since she opened it. She added Mr. McConnell as a joint trustee later in 2003, to enable him, in the event of her incapacity, to manage the funds for the children’s education. Both before and after the parties’ separation, Mr. McConnell had no actual involvement in the administration of the R.E.S.P.
129As noted above, Mr. McConnell did not list the R.E.S.P., which then contained $47,044, among his assets in his Form 79 Statement of Affairs when he declared personal bankruptcy on July 29, 2009. He also did not list the R.E.S.P., which then contained $66,044, among his assets in his Form 82 Report of Trustee on Bankrupt’s Application for Discharge on April 30, 2010. By the time the parties separated on May 3, 2013, the R.E.S.P. contained $76,048.
130An R.E.S.P. does not form part of the property of either spouse to be equalized pursuant to section 5 of the Family Law Act. R.E.S.P.’s have generally not been included as property for equalization. Given how broad the definition of property is under section 4 of the Family Law Act, it is quite clear that courts have implicitly recognized the trust relationship in relation to R.E.S.P.’s. If the R.E.S.P. was the property of the party both in title and in beneficial interest, the courts would not have tacitly accepted its exclusion from the net family property calculation. Similarly, if the R.E.S.P. was the property of any one parent without the children having a beneficial interest in it, courts would have more difficulty justifying removing an R.E.S.P. owner from the title of the account. In Shillington v. Lyne, McDermott J. stated:
This is an R.E.S.P. account for the children in Ms. Shillington’s name alone. There was a concern as to whether this account is subject to equalization, as the account would be available to Ms. Shillington to use for the children’s education, which would defer her share of the children’s educational costs in the future. In respect of this issue, Mr. Dunsmuir filed several cases, Widmeyer v. Widmeyer 2007 ONSC 59502 and Savage v. Savage 2007 ONSC 1900. In both of those cases, R.E.S.P.s were found not to be net family property, but the presiding justice ordered that those funds were to be held in trust for the children. I adopt this solution in the present case.
131In Lewi v. Lewi, Eberhard J. heard a motion by the applicant wife to vary an order of Shaughnessy J. regarding the respondent husband’s contribution to the children’s section 7 extraordinary expenses, including post-secondary education expenses.53 The husband argued that the parents should not be required to make a proportionate contribution to the children’s education until the funds in trust funds, including an R.E.S.P., were exhausted. The wife argued that the parents should make their proportionate contribution and leave the trust funds intact. Eberhard J. stated:
The Trustee placed some of the funds into R.E.S.P.s to maximize government contribution. … The amount invested from the boys funds should be considered to have been borrowed from their respective trusts either to be returned in accordance with the parental contribution hereinafter ordered or considered to be the boy’s contribution as imputed to each as follows….Mother may not pay her proportionate share from the trust.
The R.E.S.P. (except the government contribution and any interest) is the boys’ trust fund in another form. However, as a condition of the R.E.S.P. it must be used for the educational purposes for which it is designated. Therefore funds from R.E.S.P. may be, and have been, used to pay the expenses for which it is designated but this may not count as the Applicant’s contribution.54
132The court must exercise caution when one spouse asks it to remove the other spouse as administrator of an R.E.S.P. for the benefit of the parties’ children. The regulations under the CESA contain detailed requirements relating to eligibility for and calculation of C.E.S.G.s and the Canada Learning Bond, as well as rules dealing with the implications on C.E.S.G.s and the Canada Learning Bond of transferring R.E.S.P.’s.55
133In J.A.E. v. J.M.E., Rogers J., of the B.C. Supreme Court, when dismissing a request by a wife to transfer the children’s R.E.S.P. to her name, referred to the potentially serious consequences of transferring an R.E.S.P. He found no evidence that the father had mismanaged the R.E.S.P. or of a significant risk that he would raid it if it was left in his name alone. He stated:
I am prepared to take judicial notice that collapsing an R.E.S.P. may have serious negative tax consequences which may significantly erode the overall value of the plan…. Collapsing the plan at this point would expose the children to an unnecessary risk of loss, would avoid no perceptible risk of malfeasance by Mr. E, and would not overall be in the best interests of the children. Mrs. E’s notice of motion relating to transfer of the RESP is, therefore, dismissed.56 [Emphasis added]
134In Levesque v. Sorel (Charko), Kane J. dismissed the mother’s request that the R.E.S.P. be transferred to her name, and ordered that the R.E.S.P. instead be registered in both parents’ names, with the child as sole beneficiary. No specific authority was cited. Kane J. stated:
Under the provisions of the Income Tax Act:
(a) contributions made by a parent into an R.E.S.P. are not tax deductible;
(b) income earned within the R.E.S.P. is not subject to tax;
(c) payments out of the R.E.S.P. to the beneficiary child/student are considered as income and subject to income tax in the hands of the child;
(d) R.E.S.P.’s are created through a contract between a subscriber parent and a financial institution;
(e) depending upon the terms of that contract, income earned within the R.E.S.P. may be made payable to the subscribing parent;
(f) payments into an R.E.S.P. entitle modest income families entitled to the national child benefits supplement to an annual supplement paid into the R.E.S.P.; and
(g) there is no income tax liability to the father or the mother created:
(i) if the registered owner of the R.E.S.P. into which the father has been contributing is changed from the father alone to the father and mother jointly; or
(ii) if the mother opens a new R.E.S.P., with the child as beneficiary, and the father causes the transfer of a portion of the value in his R.E.S.P. into the mother’s R.E.S.P.57
135Kane J. concluded that it would be unfair:
a) If either party was credited with 100 percent of annual partial withdrawals from the R.E.S.P. for annual education costs, thereby requiring the other party to pay his or her proportionate share of those annual costs; or
b) If the father withdrew any money from the R.E.S.P. for his personal benefit.
136In the interest of avoiding further litigation, Kane J. ordered that the R.E.S.P. be amended to make the mother and father joint owners of it, with the child remaining as beneficiary. In the present case, it is impractical to leave the R.E.S.P. under the joint management of Mr. and Ms. McConnell. The breakdown in their communication that accompanied their separation makes joint decision-making by them impossible at this time.
137While the court must act cautiously, there are circumstances that require the removal of one spouse as a joint trustee of their children’s R.E.S.P. As the terms of the R.E.S.P. trust relationship do not have an express power to remove a trustee, the court must rely on its inherent jurisdiction to remove a trustee.58
138The trustees of an R.E.S.P. must act unanimously, and if there is disagreement among joint trustees, one must be removed. The authors of Waters’ Law of Trusts in Canada (4th Edition, 2012) state:
If there is disagreement between trustees, the court is likely to remove one or more of them. (Shepard v. Shepard (1911), 20 O.W.R. 810 (Ont. C.A.); Re Curran (1920), 18 O.W.N. 98; Re Consiglio (No. 1), [1973] 3 O.R. 326, 36 D.L.R. (3d) 658 (Ont. C.A.) (where misunderstandings and bitterness among the trustees led to all three being removed and replaced by a trust company); Re Owen Family Trust (1989), 33 E.T.R. 213 (B.C.S.C.) (one trustee was removed at the behest of the other trustees on the basis of a conflict of interest of the trustee being removed, ill-feeling between the trustees and that not removing the particular trustee would place the property of the trust in some danger.; and Wilson v. Hathcote, 2009 CarswellBC 10948, 48 E.T.R. (3d) 242 (B.C.S.C.) (where deadlock between the trustees prevented the trust from being properly executed and prevented administration of the trust with regard to the interests of the beneficiaries). Trustees have to act unanimously, and, if they are unable to agree on the exercise of their powers, it is clear that the trust and the beneficiaries are going to suffer.59 [Emphasis added]
139The disagreements between Mr. and Ms. McConnell have prevented, and are likely to continue preventing, the accomplishment of the objectives of the R.E.S.P. When Curran applied to university in January 2014, Ms. McConnell, in order to ensure that funds would be available to both Curran and Aidan, proposed to Mr. McConnell that the R.E.S.P. be split in two, one for each child, with each of Mr. and Ms. McConnell continuing to act as trustees in respect to both R.E.S.P.s, and with each account being subject to the same rights of survivorship, from one child to the other. In response, Mr. McConnell asked for the document she wanted him to sign, and asked her to arrange for the monthly statements for the accounts to be sent to each of them.
140Ms. McConnell sent letters of direction to Mr. McConnell on March 20, and again on April 14, 2014, requesting a change of address for the statements and to split the R.E.S.P. into two accounts, each administered by both parents, so that each child would have a fund designated for his education. Mr. McConnell did not respond to either request.
141When, during the course of the present proceeding, Ms. McConnell was notified of Mr. McConnell’s current address, she spoke to an account manager and requested the change from the Investment Associate at National Bank who was in charge of the file. The Bank staff later informed her, however, that in order to make the changes she requested, they would require additional information from Mr. McConnell, including his current income, assets, and investment account information, which she doubted she could obtain from him, so she gave up on her plan to split the account.
142On September 1, 2014, Ms. McConnell sent an e-mail to Mr. McConnell with an attached Dalhousie statement showing that $6,765.05 was due for Curran’s tuition, and attaching a direction authorizing the Bank to release $3,802.40 for the purpose of payment of the tuition. On September 4, 2014, Mr. McConnell replied to the request, stating:
I have reviewed this request and need clarification of what the $3,802.40 is for and why it is going to your account instead of Dalhousie. This amount does not correspond to the amount Dalhousie requires payment for. Their records indicate the balance is due September 19th in the amount of $4,765.05.
143On September 4, 2014, Ms. McConnell replied by e-mail to Mr. McConnell, stating:
The reason the funds come to me is because the RESP fund does not make payments directly to an educational institution. The reason for the amount is that this is the pro-rated funding available for 1 semester.
144On September 4, 2014, Ms. McConnell’s then lawyer sent a letter to Mr. McConnell’s lawyer asking, among other things, that the letters of direction be signed by Mr. McConnell to change the address for statement reporting and releasing $3,802.40 to Ms. McConnell towards payment of Curran’s tuition. On September 6, Mr. McConnell sent Ms. McConnell an e-mail stating:
I will review and respond next week. Have you made any payments to date directly to Dalhousie? If yes please provide statements and receipts.
145On September 5, 2014, Ms. McConnell’s lawyer received a letter from Mr. McConnell’s lawyer in which he stated that Mr. McConnell had at no time refused to sign any direction, nor refused to sign a release for the necessary funds to cover Curran’s tuition, but that Ms. McConnell needed to explain to Mr. McConnell the discrepancy between the amount ($3,802.40) that she had requested and the statement balance of $6,765.05 (sic, in fact, it was $4,765.05), and that she needed to provide proof of any payment made. In fact, it is evident that Mr. McConnell had, if not refused, then failed to sign the direction, and that he had failed to authorize the release of the necessary funds to pay Curran’s 1st year tuition. He had still not given his authority when Ms. McConnell’s motion was heard on December 2, 2014.
146There is precedent for the court, on the application of one spouse, to remove the other as the co-title-holder of an R.E.S.P. In Vetro v. Vetro, the Court of Appeal dismissed an appeal from a motion judge’s decision to strike the father’s pleading on the ground, among others, that he had failed to comply with an order requiring him to repay funds that he had removed from his children’s R.E.S.P. The Court stated:
In addition, the appellant took money from the children’s R.E.S.P. for his own purposes and although he agreed to repay the money he had only repaid $2,000 of the $5,500 he took. Irrespective of the issues of disclosure, the motion judge struck the pleadings on the basis of the appellant’s non-compliance with prior court orders and, having regard to the history and circumstances of the case, he was entitled to do so without giving the appellant any further opportunity to correct or explain his defaults.60
147In Maimone v. Maimone, Fragomeni J. ordered that the husband be removed as administrator of the R.E.S.P.s and that the R.E.S.P.s be transferred to the wife, on the ground that the husband had not demonstrated any financial responsibility and had made “less than frank and truthful disclosure” throughout the proceedings.61 Similarly, in Borisoff v. Borisoff, Dillon J. of the B.C. Supreme Court ordered that the R.E.S.P. be transferred.62
148For the foregoing reasons, this court is invoking its inherent jurisdiction to remove Mr. McConnell as trustee of the children’s R.E.S.P. He and Ms. McConnell will both benefit by the payments made from the R.E.S.P. as a result of the expenses to which they are required to contribute being reduced by payments being made from the fund. Ms. McConnell will therefore be required to account to Mr. McConnell for any disbursements she makes from the R.E.S.P. This will enable both parties to calculate the net s. 7 expenses of each child and their own respective proportionate contributions, at the hearing on April 22nd.
d) Severance of the claim for divorce
149Ms. McConnell does not dispute Mr. McConnell’s claim for divorce and made her own claim for divorce in the Answer which she delivered. There is no reason why an order should not be made severing the claim for divorce from the claims for collateral remedies and permitting it to proceed unopposed on affidavit evidence.
e) Disclosure
150This was not an issue argued at the hearing in December, but to facilitate a resolution of the remaining issues, an order will issue for the disclosure by each party of the classes of disclosure that Ms. McConnell has requested from Mr. McConnell.
CONCLUSION
151For the foregoing reasons, it is ordered that:
Mr. McConnell shall pay temporary child support to Ms. McConnell in the amount of $2,018 per month beginning May 1, 2013, and on the 1st of every month thereafter, until and including August 1, 2014, for the support of the two children of the marriage, Curran and Aidan McConnell, and resuming on May 1, 2015, and continuing on the 1st of every month thereafter, until and including August 1, 2015, and so on during each of the summer months, until Curran completes his first undergraduate degree.
Mr. McConnell shall pay temporary child support to Ms. McConnell in the amount of $1,642 per month, being the mid-point between $2,018 per month, being the table amount for two children, and $1,267, being the table amount for one child, beginning September 1, 2014, and continuing on the 1st of each month thereafter, until and including April 1, 2015, and resuming on September 1, 2015, and continuing until April 1, 2016, and so on, for the months of the academic sessions until Curran completes his first undergraduate degree.
Mr. McConnell shall be entitled to credit for such amounts as Ms. McConnell acknowledges in writing having received from him, or as this court may declare by order to have been paid. If a dispute arises in this regard, Mr. McConnell has leave to apply to the court for directions in this regard on the return date of the balance of the motion.
In the event Aidan attends post-secondary studies and is in residence at his school, Mr. McConnell shall, beginning September 1, and continuing on the 1st of each succeeding month of the academic session, pay temporary child support to Ms. McConnell in the amount of $1,009 for each month when both Curran and Aidan are in residence at school during the academic session, and $2,018 beginning May 1st, and continuing on the 1st of each of the summer months thereafter, when they are both residing with Ms. McConnell.
Mr. McConnell shall pay temporary spousal support to Ms. McConnell in the amount of $3,000 per month commencing January 1, 2015.
Mr. McConnell’s name shall be removed from the parties’ R.E.S.P. account No. 4A828KZ at National Bank Financial.
Each of the parties shall, by April 15, 2015, produce to the other the following:
(a) Documentation showing the balance of every security, account, and business asset held by that party on the date of marriage, and on the date of separation, including, in the case of Mr. McConnell, any interest in any solar farms or solar leasing project.
(b) The party’s complete income tax return, with all schedules and attachments, for the years 2010 to 2013, inclusive, and the notices of assessment and re-assessment from the Canada Revenue Agency for each of those years;
(c) The monthly statements for the month of marriage and the month preceding and the month following the date of marriage for any account whose balance is claimed as an exclusion or deduction by that party for purposes of their net family property.
(d) The monthly statements for the month of separation and the month preceding and the month following the month of separation, for every bank account and credit card which the party operated, alone or with another, in their own name or in the name of a corporation in which they held at least a 33% interest on the date of separation.
(e) The financial statements for the year in which the parties separated, and the preceding and following fiscal year, for any corporation in which the party held at least a 33% interest on the date of separation.
(f) All applications for credit made by the party during the period commencing January 1, 2013, to the present.
(g) The most recent two pay stubs preceding the date of this order for any employment held by the party on the date of this order.
Unless the Support Order and Support Deduction Order are withdrawn from the Office of the Director of the Family Responsibility Office, the Support Order shall be enforced by the Director, and amounts owing under the Support Order shall be paid to the Director, who shall pay them to the party to whom they are owed.
Mr. McConnell’s claim for a divorce is severed from the claims for collateral relief and may proceed uncontested, based on affidavit evidence.
The balance of the motion is adjourned to April 22, 2015. Costs are reserved to that date. In the event that the parties are unable to agree on costs, each party shall be prepared to file a Costs Outline at the conclusion of the hearing on that date.
Price J.
Released: April 8, 2015
COURT FILE NO.: FS-14-80061-00
DATE: 2015-04-08
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
KEVIN McCONNELL
Applicant
- and –
MARY PATRICIA McCONNELL
Respondent
REASONS FOR ORDER
Price J.
Released: April 8, 2015
Footnotes
- Divorce Act, RSC 1985, c 3 (2nd Supp)
- Federal Child Support Guidelines, SOR/97-175
- Harrison v. Vargek (2002), 2002 MBQB 97, 28 R.F.L. (5th) 176 (Man. Q.B.).
- Haley v. Haley, 2008 ONSC 2607
- Tapson v. Tapson, 1969 ONCA 541, [1969] O.J. No. 1490 (C.A.); Jackson v. Jackson, [1986] O.J. No. 1761 (Prov. Ct.); Farden v. Farden, 1993 BCSC 2570, 48 R.F.L. (3d) 60 (B.C.S.C.), Martin v. Martin, 1988 BCCA 2837, 26 B.C.L.R. (2d) 390 (C.A.), Grini v. Grini (1969), 5 D.L.R. (3d) 640 (Man.Q.B.).
- Ciardullo v. Ciardullo, 1995 BCSC 304, 15 R.F.L. (4th) 121 (B.C. S.C.)
- Martin v. Martin, above, at 393.
- Budyk v. Sol (1998), 40 R.F.L. (4th) 348 (Man. C.A.); Oswald v. Oswald, 2001 MBQB 47, [2001] M.J. No. 73 (Man. Q.B.); Janzen v. Janzen 1981 BCCA 449, 28 B.C.L.R. 63 (B.C. C.A.); Van de Pol v. Van de Pol.
- Gray v. Gray (1992), 39 R.F.L. (3d) 127 (Man. Q.B.); Bain v. Bain, [1994] CarswellMan 46 (Man. Q.B.)] (28 July 1994), FD 92-01-31883 [unreported]; Wahl v. Wahl 2000 ABCA 10.
- Jackson v. Jackson, above; Grini v. Grini, above.
- Holtby v. Holtby (1997), 30 R.F.L. (4th) 70 (Ont. Fam. Ct.); Oswald v. Oswald, above.
- Glen v. Glen, 1997 BCSC 1026, 34 R.F.L. (4th) 13; Oswald v. Oswald, above
- Carnall v. Carnall, 1998 SKQB 13446, 37 R.F.L. (4th) 392, supp. reasons 1998 CarswellSask 459 (Sask. Q.B.).
- Guillemette v. Horne (1993), 48 R.F.L. (3d) 229 (Man. C.A.); Wesemann v. Wesemann, 1999 BCSC 5873, 49 R.F.L. (4th) 435.
- Rebenchuk v. Rebenchuk, 2007 MBCA 22, 2007, 35 R.F.L. (6th) 239 (Man. C.A.), paras. 28 to 29
- Lewi v. Lewi, 2006 ONCA 15446, para. 162
- Driscoll v. Driscoll 2009 ONSC 66373, 2009 CarswellOnt. 7393 (SCJ)
- Moge v. Moge, above, at para. 52; Bracklow v. Bracklow, above, at para. 35; and Miglin v. Miglin, above, at para. 39.
- Moge v. Moge, 1992 SCC 25, [1992] 3 S.C.R. 813, 145 N.R. 1, [1992] S.C.J. No. 107.
- Fisher v. Fisher, 2008 ONCA 11, para. 49.
- Hotte v. Robertson, [1996] O.J. No. 1433 (Ont. Ct. (Gen. Div.)., at paras 18 and 19
- Ferreira v. Ferreira, [1998] O.J. No. 3302 (Ont. Ct. (Gen. Div.)
- Wilson v. Wilson, [2002] O.J. No. 3519 (S.C.J.), at para. 15
- Linton v. Linton, 1990 ONCA 2597, 1 O.R. (3d) 1 (C.A.), at 27-28.
- Linton, para. 27
- Moge v. Moge, 1992 SCC 25, [1992] 3 S.C.R. 813, 145 N.R. 1, 43 R.F.L. (3d) 345, [1992] S.C.J. No. 107, citing Rogerson, “Judicial Interpretation of the Spousal and Child Support Provisions of the Divorce Act, 1985 (Part I)”, at pp. 174-75. (p. 870).
- Mullin v. Mullin (1991), supra, and Linton v. Linton, supra.
- Thomas v. Thomas, 2003 ONSC 64346, [2003] O.J. No. 5401.
- Family Law Act, R.S.O. 1990, c. F.3 as amended
- Mann v. Mann, 2009 ONSC 23874.
- Spousal Support Advisory Guidelines, (Ottawa: Dept. of Justice, 2008), Section 7.4.2
- Federal Child Support Guidelines, SOR/97-175, s. 19
- Thompson v. Gilchrist, 2012 ONSC 4137; DePace v. Michienzi, 2000 ONSC 22560, [2000] O.J. No. 453, (Ont. Fam. Ct.)
- Homsi v. Zaya 2009 ONCA 322
- Riel v. Holland, 2003 ONCA 3433, at para. 23.
- Hagner v. Hawkins 2005 ONSC 43294, at para. 19
- Lawson v. Lawson, 2006 ONCA 26573,
- Fraser v. Fraser, 2013 ONCA 715, [2013] O.J. No. 5347 (ONCA)
- Ludmer v. Ludmer, 2014 ONCA 827, [2014] O.J. No. 5565 (ONCA)
- Laurain v. Clarke, 2011 ONSC 7195, para. 35, cited by Mossip J. in Laurain v. Clarke, 2013 ONSC 726, at para. 41
- Foley v. Weaver 2010 ONSC 3305, [2010] O.J. No. 2741 (ONSC)
- Stevens v. Boulerice 1999 ONSC 14995, [1999] O.J. No. 1568 (ONSC)
- Fraser v. Fraser, at para. 103
- Warsh v. Warsh, 2012 ONSC 6903, para. 24
- The status of R.E.S.P.s in the context of family law and trust disputes has not been given in depth consideration in the jurisprudence. I am grateful for the helpful assistance of my Judicial Law Clerk Arieh Bloom, J.D., C.P.A., in developing the analysis that follows.
- Canada Education Savings Act, S.C. 2004, c. 26 (“CESA”)
- R.E.S.P.s and Estate Planning by Florence Carey (2008), 27 Est. Tr. & Pensions J. 124.
- Henry v Henry (1999), 30 E.T.R. (2d) 89 (ONCA), at para. 14
- Waters’ Law of Trusts, 4th edition at pg. 141
- Sterkenburg Estate v Sterkenburg, [2005] O.J. No. 1935 at para. 18 (Sup. Crt.)
- Waters’ Law of Trusts in Canada, 4th Edition, Carswell 2012, p. 39
- Hockey-Sweeney v. Sweeney, 2004 ONCA 34840, [2004] O.J. No. 4412 (ONCA)
- Lewi v. Lewi, 2005 ONSC 4441
- Lewi v. Lewi, paras. 18 to 21
- Canada Gazette, Vol. 139, No. 11 on June 1, 2005
- J.A.E. v. J.M.E., 2007 BCSC 167, para. 57
- Levesque. v. Sorel (Charko), 2013 ONSC 4775, para. 47
- Re Ocean Man Trust (1993), 113 Sask. R. 179, 50 E.T.R. 150 at paras. 8-10 (Sask. C.A.), Evans v Gonder, 2010 ONCA 172, 54 E.T.R. (3d) 193 at para 24.
- Waters’ Law of Trusts in Canada, above, p. 902
- Vetro v. Vetro, 2013 ONCA 303, para 5
- Maimone v. Maimone, 2009 ONSC 25981, at para. 56
- Borisoff v. Borisoff, 2002 BCSC 444