Editor’s note: Addendum released on August 6, 2015 and appended to the original decision. The corrections were not integrated in the original reasons.
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
COLLEEN FROESE
Jolanta B. Bula, for the Applicant
Applicant
- and -
ERIC FROESE
Keith R. Newell, for the Respondent
Respondent
HEARD: April 13, 14 &15, 2015
The Honourable Madam Justice L.M. Walters
Overview
1The parties began living together in May 1996. They married on April 11, 2001 and separated on October 29, 2007. There are no children of the relationship.
Issues to be Determined
2The following issues arise from this marriage breakdown:
(a) What, if any, equalization of net family properties is to be paid to either party?
(b) Does the applicant have any proprietary or monetary interest in after-separation-acquired property of the respondent?
(c) Is the applicant entitled to spousal support, and, if so, what is the respondent’s income?
Background Facts
3The applicant is 47 years of age. She has a high school education and is currently working at Tim Horton’s and Swiss Chalet. She resides in a home at 489 Niagara Street, which she owns. Her mother resides upstairs and she occupies the basement.
4The respondent is 50 years of age. He is the owner and operator of Froese Property Maintenance, a company which does industrial and commercial renovations along with some property maintenance. The respondent continues to reside in the former matrimonial home located at 40 ½ Lloyd Street, St. Catharines, which he owned prior to the date of marriage.
5The parties met in the spring of 1996 and, by the fall of that year, the applicant moved into the respondent’s home at 40 ½ Lloyd Street, St. Catharines. The parties continued to reside in that home together until the applicant moved out on December 3, 2007.
6Prior to meeting the respondent, the applicant worked in retail and operated a small business from her home. The respondent was employed full time with Hayes Dana and, on the weekends, he operated a maintenance/janitorial business.
7In early 1998, the applicant was laid off from her employment and enrolled in an aesthetician’s course. The respondent approached her about doing some painting for the properties that he looked after. In time, the parties determined that they could make a financial success of this property maintenance/renovation business and they both concentrated all their efforts on making the business a success. The applicant did painting, snow removal and grass cutting. The respondent concentrated on doing the building renovations but also did some painting, snow removal and grass cutting. By the beginning of 1999, the business was doing so well that the respondent quit his employment at Hayes Dana to concentrate full time on this business.
8During the course of the marriage, the parties were able to acquire certain investment properties: 42 Lloyd Street, and 65 Edith Street which was severed to create 63 Edith Street.
9As is often the case in matrimonial disputes, the court heard conflicting evidence from the parties about what occurred during the years of cohabitation. Here, unless otherwise stated, I have preferred the evidence of the applicant to that of the respondent. I come to this conclusion for several reasons. First, the applicant gave her evidence in a clear, straightforward manner and was not seriously challenged on cross-examination. She was full and frank with the court in disclosing her financial circumstances.
10The same cannot be said for the respondent. The respondent filed several financial statements with the court. The information on these statements is not all consistent. Mr. Froese was questioned prior to trial and although acknowledging that he was confused, gave some inconsistent evidence at trial. Statements completed by Mr. Froese for the bank, when attempting to get mortgage financing, overvalued several of his assets. At trial, the values are significantly less. More troubling is the failure of Mr. Froese to provide the court with almost any documentation regarding his purchase of a 1.4 million dollar commercial building. The court has no particulars regarding tenants, rent rolls, or expenses, other than some limited information the court elicited from Mr. Froese at the end of his examination in-chief and cross-examination.
11Despite requests by the applicant, the respondent has not provided full particulars of his business expenses and, accordingly, it is most difficult to accurately determine what Mr. Froese’s actual income is.
12For all of these reasons, it is difficult for the court to put a lot of credence in the evidence of Mr. Froese as it relates to his income, assets and expenses.
13I accept the evidence of the applicant that throughout their period of cohabitation and marriage, the parties worked together for their common good. I find that they operated a joint business despite the fact that the business name and business bank account were in the name of Mr. Froese. The applicant had signing authority on the business account and she would transfer funds back and forth between the personal and business accounts.
14The rents from 65 Edith Street and 42 Lloyd Street were co-mingled with funds from the business. At the time of separation, the parties remained in the matrimonial home together until December 2007, when the applicant vacated the home and moved, rent-free, into a vacant apartment at 65 Edith Street.
15The parties discussed a settlement whereby a property would be purchased for the applicant. This is when 289 Niagara Street was purchased. The $25,000.00 deposit came from the joint account. I accept the applicant’s evidence that there was an expectation that the respondent would help her fix that home so that a bachelor apartment would be created that could be rented out in order to supplement her income. However, the hopes of completing the bachelor apartment never materialized.
16When 65 Edith Street was severed to create 63 Edith Street, 63 was vacant land. At separation the parties cannot agree on what, if any, portion of the home ultimately constructed on 63 Edith existed and what value should be included in the equalization calculation.
17Unknown to the applicant, in September 2007, prior to the date of separation, the respondent entered into an agreement of purchase and sale to purchase a one-half interest in a commercial property located at 514 Queenston Street, for the price of $700,000.00. The $12,500.00 deposit was taken from the co-mingled funds of the parties prior to separation. This transaction was completed after the date of separation, namely, on April 3, 2008. On November 17, 2011, Mr. Froese was able to purchase the remaining one-half interest in this property and now he (his company) is the sole owner of this building valued at 1.4 million dollars. This property has a 1.3 million dollar mortgage outstanding with Meridian Credit Union, along with a $274,000.00 mortgage outstanding to Mr. Bird, the individual from whom Mr. Froese purchased the initial 50% interest in the property.
18After separation, the parties continued working together, maintained their bank joint account and the applicant continued to assist with the bookkeeping and the paying of bills. By April 2008, it was apparent that the separation was to be final and the parties discussed a resolution of their property issues. The parties did not seek legal advice, nor was any formal documentation ever prepared. Part of the arrangement was that the applicant would retain 489 Niagara Street, and the proceeds of sale from 65 Edith Street. Mr. Froese would retain 40 ½ Lloyd Street, 42 Lloyd Street, and 63 Edith Street. In addition, Mr. Froese would provide the applicant with $28,000.00.
19When the parties were unable to reach a final agreement, this application was commenced in November 2011.
20With this backdrop, I now turn to the issues for the court to determine.
(a) What if any equalization of net family properties is to be paid to either party?
21Unfortunately, the court has not received proper valuations from Mr. Froese regarding the value of several vehicles he owned on the valuation date, along with a proper value for his business. In addition, Mr. Froese has not provided any documentation regarding property he claims he owned as of the date of separation.
22Without proper documentation, the court cannot make a determination of value in a vacuum and, accordingly, without the consent of both parties, those specific items must be excluded from any calculation of net family property.
23Each party has filed a net family property statement with the court. I will deal, in these reasons, only with those items that are in dispute between the parties.
Land
24The parties have agreed on the value of the matrimonial home, located at 40 ½ Lloyd Street, the jointly owned property at 42 Lloyd Street and the jointly owned property at 65 Edith Street. The major area of dispute relates to the property at 63 Edith Street. The position of Mrs. Froese is that by the time the parties separated, Mr. Froese had started building a home on the property which included the foundation, the framing, the windows and roof. The position of Mr. Froese is that, at the time of separation, 63 Edith Street was only a vacant lot.
25The court has no formal appraisal with respect to this property. Both agree that the vacant land alone had a value of $34,000.00. Mr. Froese contends that that is the appropriate value to use on the net family property statement. Mrs. Froese argues that with the partially built house, the property had a value of $157,000.00 evidenced by a blanket mortgage dated April 2^nd^, 2008, which included this property.
26In support of his position, Mr. Froese filed a foundation inspection by the City of St. Catharines dated October 11, 2007 and a framing inspection dated August 28, 2008. His evidence is that only the foundation was completed by October 11, 2007 and by the date of separation, on October 31, 2007, nothing else had been completed.
27The applicant relies on the April 2, 2008 mortgage, which included both 40 ½ Lloyd Street and 63 Edith Street. Canada Mortgage Investment Corporation advanced $157,367.37. The parties have agreed that on separation the value of 40 ½ Lloyd Street was $220,000.00. That property already had a $125,000.00 mortgage secured against it. Accordingly, there only remained $95,000.00 in equity which was available for mortgage purposes. The balance of the $157,367.00 advanced by Canada Mortgage must relate to the value of 63 Edith Street. Further, on his personal financial statement to Meridian Credit Union dated January 15, 2008, the respondent advised the Credit Union that on 63 Edith Street, the foundation, framing, roof, windows and wiring had been started
28This written documentation flies in the face of Mr. Froese’s testimony that there was only a foundation on the property. In his evidence, the cost of the foundation would have been in the neighborhood of $8,000.00. At minimum that would increase the value of the property to $42,000.
29In all of the circumstances, I am satisfied that the property was not just a vacant lot on the date of separation. In terms of ascribing a value as to what work, if any, had been completed by that date, in my view, the best evidence before the court is that of Mr. Froese himself, on January 15^th^ when he advised the bank of the condition of the property. This is also confirmed by the mortgage which was obtained in April 2008. At minimum, I find that $62,367.00 must be attributable to the value of the property at Edith Street. I can take judicial notice that no traditional lender would advance 100% of the value of a property and, therefore, at best, this $62,367.00 must represent 95% of the value of the property. In these circumstances, I find that the value of this property, including the partial construction, is $65,600.00.
General Household Items and Vehicles
30Household goods - There is no dispute between the parties. These items have been already divided to the parties’ satisfaction.
311989 Fleetwood Tioga Classic Motorhome - The court has no appraisals. The respondent argues that this motor home has a value of $4,500.00. The applicant argues that the home has a value of $18,000.00 based on Mr. Froese’s financial statement provided to Meridian Credit Union in January 2008, two months after separation.
32It is clear to me that Mr. Froese overinflated the value of his assets when he was attempting to secure funds from certain lenders. However, these assets were Mr. Froese’s to value. He has failed to do that and has put the applicant and the court at a disadvantage. On three separate occasions, the respondent listed the value of the motor home, at either $18,000.00 or $15,000.00. It is suspicious at best, that for equalization purposes, the value of this particular asset has been reduced by more than 200%. I fix the value of this motor home at the lowest value claimed by Mr. Froese in his personal financial statements to the bank, namely, $15,000.00.
332005 Pro Sport Bow Rider Fishing Board - Silvan - The applicant, again relying on Mr. Froese’s financial statements to the Credit Union, lists the value of this boat at $42,000.00. Mr. Froese testified that the boat only has a value of $15,000.00. The court has the benefit of the purchase documentation regarding this boat. Two years prior to the date of separation, this boat, with all of the trimmings was purchased for $33,000.00. The actual price of the boat without freight, taxes and further options was $26,500.00. Without the benefit of an appraisal, that is the most accurate estimate of the boat’s value as of the date of separation. Accordingly, the boat shall be valued at $26,500.00.
34All other vehicles and equipment owned by Mr. Froese shall be dealt with when I consider the value of Mr. Froese’s business.
Bank Accounts and Savings, Securities and Pensions
35There is no dispute between the parties regarding their respective savings accounts and securities. Mr. Froese, however, inappropriately used the book value for both his TD Waterhouse Mutual Funds and Mrs. Froese’s TD Canada Trust Mutual Funds instead of using the market value as of the date of separation. Accordingly, I have accepted the numbers as set out in Mrs. Froese’s net family property statement which correspond with Exhibit 3 filed at trial. The only other correction to this part of the net family property statement is that Mrs. Froese showed an overdraft on the joint chequing account of $1,000.00 for each of the parties. In fact, the October 31, 2007 statement showed that the overdraft was $5,261.98. As this is a joint account, the difference in the amount does not affect any equalization payment.
Business Interests
36Froese Property Maintenance - Mr. Froese has operated Froese Property Maintenance since 1988. Once again, he has not provided the court with any valuation of this business which is a sole proprietorship. However, the business does own several pieces of equipment including:
2000 Chevy Silverado
2003 Chevy Silverado
1980 Chevy Pickup
1974 Chevy Blazer
1979 Chevy Pickup
1989 Ford F250
6 western plows
2 western salt spreaders
1999 John Deere Tractor
2004 Honda 4 Truck
580E Case Back-hoe
3 walk behind 12 HP Craftsman Snow blowers
2003 Honda ATV
37Relying on the information Mr. Froese provided to the Meridian Credit Union, the applicant asks that the court to attribute a value of some $102,000.00 to this business equipment.
38On his financial statement, if one excludes the boat and motorhome, which the court has already valued, Mr. Froese states that the value of all of this equipment is $71,000.00.
39At various times, when requesting credit from financial institutions, Mr. Froese indicated that his equipment had a value in excess of $100,000.00.
40Once again, without any valuations, the court is left in a very difficult position. To exclude the business, because of Mr. Froese's failure to properly value it, is unfair to the applicant, and would reward the respondent's bad conduct. Although it might be tempting to value the equipment at the inflated number Mr. Froese used on credit applications, I have declined to do so. Mr. Froese owned and operated this business prior to separation. He has provided no valuations for this pre-marriage asset and so no deduction is possible, except as agreed between the parties. Although not the most accurate source of information, I will use Mr. Froese's estimates of value. Accordingly, I find the value of Mr. Froese’s business at separation to be $71,000.00.
Value of Debts and Liabilities on Valuation Date
41The parties have agreed on all debts and liabilities except for a few items:
(i) Mr. Froese has indicated he had an amount of $722.00 owing to Sunoco Gas. The court has no documentation of same.
(ii) Mrs. Froese indicated she had a Visa with Canada Trust in the amount of $520.74. She has provided documentation at Exhibit 3, Tab 19A and I accept same.
(iii) The MasterCard with Capital One of $5,078.74 is a joint account and accordingly, should show up on both parties’ net family property statement.
(iv) Mrs. Froese has shown an amount for contingent tax liability on the parties’ RRSPs. I heard no evidence from Mr. Froese in this regard. However, it is clear to me that both parties cashed their RRSPs and therefore the notional disposition cost of 20% is appropriate.
(v) Mr. Froese has provided a copy of an invoice from Hartlieb Hopkins in the amount of $1,545.00 and I accept that this amount was outstanding as of the date of separation.
Property, Debts and Other Liabilities on Date of Marriage
42Neither party has provided the court with any documentation regarding these items. However, the respective net family property statement of each party shows that there is agreement on five items. Mrs. Froese has accepted that Mr. Froese had assets of some $81,623.46 with an outstanding $30,000.00 liability on the 2000 Silverado. I am prepared to accept those numbers in accordance with the consent of the parties. The other items that Mr. Froese indicated he owned on the date of separation are not allowed as he has failed to properly value those items as he is required to do.
(b) Does the applicant have any proprietary or monetary interest in after-separation-acquired property of the respondent?
43Mrs. Froese claims an interest in property Mr. Froese obtained after the date of separation, namely, 514 Queenston Street. Mr. Froese acknowledged that the $12,500.00 deposit was obtained from co-mingled funds, prior to the date of separation. The evidence is clear that, except for this amount, all other costs related to the acquisition and maintenance of this building occurred after separation and were paid for by Mr. Froese. In these circumstances, I cannot find that the applicant had a proprietary interest in 514, save and except for her share of the deposit.
44With these findings, I can now reproduce the net family property statement.
Table 1: Value of Assets Owned on Valuation Date
Nature & Type of Ownership
Address of Property
Applicant
Respondent
Matrimonial Home
Property jointly owned -
Property jointly owned –
Land with partially build house - sole
Deposit
40 ½ Lloyd Street
St. Catharines ON – appraisal
42 Lloyd Street, St. Catharines – purchased January 18, 2007 @ $80,000.00
65 Edith Street, St. Catharines
63 Edith Street, St. Catharines
Barnicky’s appraisal v. blanket mortgage
514 Queenston Street
$40,000.00
$80,000.00
$6,250.00
$220,000.00
$40,000.00
$80,000.00
$65,600.00
$6,250.00
Totals: Value of Land
$126,250.00
$411,850.00
General Household Items and Vehicles
Item
Description
Applicant
Respondent
Household goods & furniture;
Cars, boats, vehicles;
Jewelry, art, electronics, tools, sports & hobby, equipment
Not in dispute, already divided
1989 Fleetwood Tioga Classic Motorhome
2005 Pro Sport Bow Rider Fishing Boat - Silvan
All other vehicles included in business valuation
$26,500.00
$15,000.00
Totals: Value of General Household Items and Vehicles
$26,500.00
$15,000.00
Bank Accounts and Savings, Securities and Pensions
Category
Institution & Account Number
Applicant
Respondent
Chequing joint
RRSP
RRSP
RRSP
RRSP
RRSP
RRSP
TD Canada Trust (Oct 31/07 $5,261.98)
TD Mutual Funds
TD Waterhouse
The Cooperators
TD Mutual Funds
Cooperators
TD Waterhouse
($2,630.99)
$4,308.66
$5,709.17
$24,463.57
($2,630.99)
$7,540.14
$70,922.12
$10,259.83
Totals: Value of Accounts and Savings
$31,850.41
$86,091.10
Business Interests
Name of Firm/Company
Interests
Applicant
Respondent
Froese Property
Maintenance
2000 Chevy Silverado
2003 Chevy Silverado
1980 Chevy Pickup
1974 Chevy Blazer
1979 Chevy Pickup
1989 Ford F250
6 western plows
2 western salt spreaders
1999 John Deere Tractor
2004 Honda 4 Truck
580E Case Back-hoe
3 walk behind 12 HP Craftsman Snow blowers
2003 Honda ATV
$71,000.00
Totals: Value of Business Interests
$0.00
$71,000.00
Total 1: Value of Property Owned on the Valuation Date
$184,600.41
$583,941.10
Table 2: Value of Debts and Liabilities on Valuation Date
Debts and Other Liabilities
Category
Details
Applicant
Respondent
Matrimonial home 40 ½ Lloyd Street
Mortgage on 42 Lloyd St.
Mortgage on 65 Edith St.
TD Canada Trust
TD Canada Trust balance @ Nov. 7, 2007 $67,922.47
TD Canada Trust
$33,961.23
$56,957.32
$73,114.60
$33,961.23
$56,957.32
Colleen’s debts sole and joint
TD Canada Trust
Brick card – sole
Sears MasterCard – sole
Canada Revenue Agency
Canada Revenue Agency
Capital One
RRSP taxes
Eric’s personal debts
TD Visa Emerald
TD GM Visa
American Express
Home Depot
TD Canada Trust
RRSP taxes
Hartlieb Hopkins
Visa – sole
2007 personal tax owing
2007 GST owing
MasterCard – joint
Taxes on $33,481.40 – 20%
Line of credit
Taxes on $87,722.09 – 20%
$520.74
$849.25
$4,380.35
$19,388.24
$5,147.38
$2,539.37
$6,696.28
$2,539.37
$3,287.75
$2,049.55
$8,570.84
$5,709.00
$2,423.75
$17,544.41
$1,545.00
Total 2: Debts&Liabilities
$130,440.16
$207,702.82
Table 3: Net Value on Date of Marriage of Property
Property, Debts and Other Liabilities on Date of Marriage
Category
Details
Applicant
Respondent
General household items and vehicles
1979 Chevy pickup
2000 Silverado
Bank accounts and savings-Td RSP
TD Waterhouse
Debts and liabilities
Car loan – 2000 Silverado
$0.00
$3,000.00
$10,000.00
$33,800.00
$23,261.34
$11,562.12
($30,000.00)
Total 3: Net Value of Property Owned on Date of Marriage
$0.00
$51,623.46
Value of Property Owned on Valuation Date
$184,600.41
$583,941.10
Minus Debts and Liabilities
Minus Net Value of Property Owned on Date of Marriage
$130,440.16
$207,702.82
$51,623.46
Net Family Property
$54,160.25
$324,614.82
EQUALIZATION PAYMENTS
Applicant Pays Respondent
$0.00
Respondent Pays Applicant
$135,227.28
45This equalization payment shall be secured as a charge against the former matrimonial home, located at 401/2 Lloyd Street, and on the properties located at 37 Lloyd Street, and 514 Queenston Street, until it is paid in full. Judgment will bear interest in accordance with the Courts of Justice Act from the date of Judgment until payment in full.
(c) Is the applicant entitled to spousal support, and if so, what is the respondent’s income?
46The final issue for the court to determine is whether or not the respondent should pay any retroactive or ongoing spousal support to the applicant.
47The position of the applicant is that she is entitled to spousal support on either a compensatory or non-compensatory basis. During the marriage, she worked together with her husband in a family business venture. Over the years, due to her hard work, the business became a success. On separation, the respondent has not provided any spousal support. His promises to renovate her property to provide rental income never came to fruition. Due to back issues, she was no longer able to do the physical labour she performed with the family business and has sought alternate employment. She currently works two jobs in order to make ends meet. She has suffered financial hardship. She has had to cash her RRSP in order to support herself and pay matrimonial debts. Her mother resides with her in order to assist with property expenses.
48At the same time, the respondent has had no change whatsoever in his lifestyle. He retained all of the assets of the business and carried on. Without her knowledge, he was able to purchase a large commercial building. He has provided no financial information regarding the income generated by that building. Further, he has not provided the information requested with respect to his business expenses. The applicant is asking that the respondent have income imputed to him corresponding to the income he enjoyed prior to the date of separation. Despite gross business revenue remaining the same, the respondent’s declared income for tax purposes has significantly dropped since separation without satisfactory explanation. In all of the circumstances, the applicant asks that the respondent’s income be fixed at $126,000.00.
49The position of the respondent is that the applicant is not entitled to spousal support as she is capable of supporting herself. She voluntarily ceased operating her own painting and maintenance company after the date of separation and chose instead to work in the food industry. Although conceding that the applicant has some back issues, the position of the respondent is that the applicant could have and did hire other people to assist her in the business and she could have continued with that line of work and would have earned considerably more income than she is currently earning. As a result of the separation, he has himself experienced a downturn in his personal income. He no longer has someone to assist him with the business and his income has been reduced accordingly. Further, although he has managed to purchase the building at 514 Queenston Street, there is no income generated from that business, he is in his words “robbing Peter to pay Paul.”
50The threshold issue for determining spousal support is entitlement. The relevant factors are found in s. 15(2)(4) of the Divorce Act. It is well-established that there are three grounds for entitlement to support: compensatory support, non-compensatory support and contractual support (Bracklow v. Bracklow, 1999 CanLII 715 (SCC), [1999] 1 SCR 420).
51The applicant’s claim must fall under one of these three categories for her to be entitled to receive spousal support from the respondent.
52Here, there is no contractual basis for support.
53I now turn to the principles of compensation or economic disadvantage. Did the applicant suffer any economic disadvantage as a result of the marriage? In my view, I am satisfied on the evidence before me that the applicant and respondent were in a joint venture to make this renovation/property management business a success. As Mr. Froese acknowledged “if they didn’t work together, we’d have nothing.” Unfortunately, what occurred when the marriage ended is that the business partnership ended as well. Mr. Froese retained all of the equipment for the business and he continued on with his work. Mrs. Froese, on the other hand, because of her back issues, had already started to cut back on the amount of work she was able to do starting in 2006. Thereafter, she was left without any equipment, little assistance from the respondent and sought to obtain other work to support herself. She is now 47 years of age. She only has a high school education and has no other real training in another field. Although there was no medical evidence, it was unchallenged that the applicant has had some significant back issues which included some 30 treatments she received in order to assist with the severe back pain she was experiencing.
54The respondent did not follow through with his promise to renovate the Applicant's home so that she'd have a bachelor apartment that would provide her with some rental income.
55The court has all of the applicant’s income particulars both before and since the date of separation. It is clear that once the business was established, she earned more income than she currently is.
56Although I am satisfied that there is a compensatory basis for the applicant’s support, I also find she is entitled to support on a non-compensatory basis. She has need and Mr. Froese has the ability to contribute. The respondent earns more money than the applicant and has the ability to earn more income. Of greatest concern to the court is the inability to actually estimate what the respondent’s income is, because of his failure to provide all the relevant documentation.
57In considering any amount of spousal support, the court must consider the equalization which has already been ordered. As a result of my determination today, the respondent owes the applicant an equalization payment of $135,227.28. I must consider what, if any, ability the respondent still has to pay spousal support in light of this property obligation.
58Since separation, the respondent, has been able to purchase, a rental property at 37 Lloyd Street, having a value of $120,000.00, and a commercial building at 514 Queenston Street, St. Catharines, having a value of 1.4 million dollars. According to his financial statement, the respondent takes a draw of $4,000.00 per month as self-employment income and has rental income of $750.00 a month from Lloyd Street. Unknown, because the respondent failed to provide the information, are the income and expenses of his business along with documents substantiating the income and expenses of 514 Queenston Street.
59What we do know is that Mr. Froese has not missed a mortgage payment to Mr. Bird, and those payments are in the amount of $2,000.00 per month. The mortgage on 514 Queenston Street provides for payments of $1,800.00 bi-weekly. Once again, we have no indication whatsoever that these mortgage payments are in arrears.
60I have no doubt that Mr. Froese is in a position that he can assist the applicant in her support.
61I now turn to the difficult issue of determining as best I can what Mr. Froese’s income is for the purposes of support.
62The applicant has urged the court to find that Mr. Froese’s income is the same as it was prior to the date of separation. The financial statements filed with the court show that the gross business income has remained relatively stable, and it is only the amount of net income that has seriously declined since the date of separation.
63The respondent argues that his income has gone down. Firstly, he has lost his partner, Mrs. Froese, and it is more difficult for him to run the business on his own, and, because of the downturn in the economy, he is not able to earn the same amount of money. He argues that all of his rental properties, including 514 Queenston Street, are just breaking even and that there is no profit to be had.
64The respondent’s failure to provide the court with the documentation necessary to support his contentions makes his argument difficult to accept. The court can draw an adverse inference from Mr. Froese’s failure to provide the court with all of the relevant information necessary to determine his income.
65If one averages the net business income Mr. Froese earned in the last 3 years for which income tax returns have been provided (2011, 2012 and 2013) his income would be approximately $68,000.00. To this amount, if I add the notional costs of capital cost allowance claimed in the 2013 return, along with the $1,985 of unexplained additional expenses, and 25% of automobile expenses, representing personal use, the net income would be $80,000.00. This does not take into account any income earned from either 37 Lloyd or 514 Queenston Street. As I anticipate that 37 Lloyd may have to be sold, and the mortgage on 514 increased in order to satisfy the equalization payment, I will not impute any other additional income to Mr. Froese. I find his income for spousal support to be $80,000.00 per year.
66Neither party provided the court with any SSAG tables. I have run the numbers using $20,000 for Mrs. Froese's income, and $80,000 for Mr. Froese. The results are a range of suggested support from $1,100 to $1,467, with the mid value being $1,283. The suggested duration is 5.5 to 11 years, subject to variation and possibly review.
67Mr. Froese provided minimal assistance to the applicant after separation. I accept the evidence of the applicant that she did not move earlier for support because she first thought there was a possibility of reconciliation, and later because of the respondent’s promises to take care of her.
68In order to finance the equalization payment, Mr. Froese's ability to pay support will be reduced. As well, with an additional $135,000.00, the Applicant's ability to support herself has improved. For these reasons, I will depart from the amounts suggested by the SSAG. Instead, the respondent shall pay to the applicant for her support the sum of $800.00 per month, commencing on the 1^st^ day of July, 2015, and payable to and including the 1^st^ of June, 2020, at which time the respondent's obligation to provide spousal support shall cease.
69Final order to go in accordance with these reasons.
Costs
70If the issue of costs cannot be resolved, I direct that the party seeking costs shall deliver written submissions to my chambers, at 59 Church Street, 4^th^ Floor, St. Catharines, L2R 7N8, within 10 days of the release of this judgment with responding submissions to be delivered to my office within 10 days thereafter. The written submissions are not to exceed three typewritten, double-spaced pages, excluding the Bill of Costs and Costs Outline. If no submissions are received within this timeframe, the parties will be deemed to have settled the issue of costs as between themselves.
Walters J.
Released: June 29, 2015
CITATION: Froese v. Froese, 2015 ONSC 4060
COURT FILE NO.: 852/11
DATE: 2015/06/29
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
COLLEEN FROESE
Applicant
- and -
ERIC FROESE
Respondent
REASONS FOR JUDGMENT
Walters J.
Released: June 29, 2015
CITATION: Froese v. Froese, 2015 ONSC 4060
COURT FILE NO.: 852/11
DATE: 2015/08/06
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
COLLEEN FROESE
Jolanta B. Bula, for the Applicant
Applicant
- and -
ERIC FROESE
Keith R. Newell, for the Respondent
Respondent
The Honourable Madam Justice L.M. Walters
ADDENDUM TO JUDGMENT
71After my reasons for judgment were released on June 29, 2015, I invited counsel to provide me with their written submissions on costs.
72In her submissions, Ms. Bula advised that an error was made on the Net Family Property Statement in that the value of Mr. Froese’s 2005 Pro Sport Bow Rider was attributed to Mrs. Froese. Ms. Bula asks that this correction be dealt with by way of costs.
73I have reviewed my decision and confirm that the error was made. In these circumstances, it is appropriate to correct the Net Family Property Statement itself to accurately reflect my reasons for judgment.
74The following is the amended Net Family Property Statement. The equalization payment owed by Mr. Froese is now $161,727.28.
Amended Net Family Property Statement
Table 1: Value of Assets Owned on Valuation Date
Nature & Type of Ownership
Address of Property
Applicant
Respondent
Matrimonial Home
Property jointly owned -
Property jointly owned –
Land with partially build house - sole
Deposit
40 ½ Lloyd Street
St. Catharines ON – appraisal
42 Lloyd Street, St. Catharines – purchased January 18, 2007 @ $80,000.00
65 Edith Street, St. Catharines
63 Edith Street, St. Catharines
Barnicky’s appraisal v. blanket mortgage
514 Queenston Street
$40,000.00
$80,000.00
$6,250.00
$220,000.00
$40,000.00
$80,000.00
$65,600.00
$6,250.00
Totals: Value of Land
$126,250.00
$411,850.00
General Household Items and Vehicles
Item
Description
Applicant
Respondent
Household goods & furniture;
Cars, boats, vehicles;
Jewelry, art, electronics, tools, sports & hobby, equipment
Not in dispute, already divided
1989 Fleetwood Tioga Classic Motorhome
2005 Pro Sport Bow Rider Fishing Boat - Silvan
All other vehicles included in business valuation
$15,000.00
$26,500.00
Totals: Value of General Household Items and Vehicles
$0.00
$41,500.00
Bank Accounts and Savings, Securities and Pensions
Category
Institution & Account Number
Applicant
Respondent
Chequing joint
RRSP
RRSP
RRSP
RRSP
RRSP
RRSP
TD Canada Trust (Oct 31/07 $5,261.98)
TD Mutual Funds
TD Waterhouse
The Cooperators
TD Mutual Funds
Cooperators
TD Waterhouse
($2,630.99)
$4,308.66
$5,709.17
$24,463.57
($2,630.99)
$7,540.14
$70,922.12
$10,259.83
Totals: Value of Accounts and Savings
$31,850.41
$86,091.10
Business Interests
Name of Firm/Company
Interests
Applicant
Respondent
Froese Property
Maintenance
2000 Chevy Silverado
2003 Chevy Silverado
1980 Chevy Pickup
1974 Chevy Blazer
1979 Chevy Pickup
1989 Ford F250
6 western plows
2 western salt spreaders
1999 John Deere Tractor
2004 Honda 4 Truck
580E Case Back-hoe
3 walk behind 12 HP Craftsman Snow blowers
2003 Honda ATV
$71,000.00
Totals: Value of Business Interests
$0.00
$71,000.00
Total 1: Value of Property Owned on the Valuation Date
$158,100.41
$610,441.10
Table 2: Value of Debts and Liabilities on Valuation Date
Debts and Other Liabilities
Category
Details
Applicant
Respondent
Matrimonial home 40 ½ Lloyd Street
Mortgage on 42 Lloyd St.
Mortgage on 65 Edith St.
TD Canada Trust
TD Canada Trust balance @ Nov. 7, 2007 $67,922.47
TD Canada Trust
$33,961.23
$56,957.32
$73,114.60
$33,961.23
$56,957.32
Colleen’s debts sole and joint
TD Canada Trust
Brick card – sole
Sears MasterCard – sole
Canada Revenue Agency
Canada Revenue Agency
Capital One
RRSP taxes
Eric’s personal debts
TD Visa Emerald
TD GM Visa
American Express
Home Depot
TD Canada Trust
RRSP taxes
Hartlieb Hopkins
Visa – sole
2007 personal tax owing
2007 GST owing
MasterCard – joint
Taxes on $33,481.40 – 20%
Line of credit
Taxes on $87,722.09 – 20%
$520.74
$849.25
$4,380.35
$19,388.24
$5,147.38
$2,539.37
$6,696.28
$2,539.37
$3,287.75
$2,049.55
$8,570.84
$5,709.00
$2,423.75
$17,544.41
$1,545.00
Total 2: Debts&Liabilities
$130,440.16
$207,702.82
Table 3: Net Value on Date of Marriage of Property
Property, Debts and Other Liabilities on Date of Marriage
Category
Details
Applicant
Respondent
General household items and vehicles
1979 Chevy pickup
2000 Silverado
Bank accounts and savings-Td RSP
TD Waterhouse
Debts and liabilities
Car loan – 2000 Silverado
$0.00
$3,000.00
$10,000.00
$33,800.00
$23,261.34
$11,562.12
($30,000.00)
Total 3: Net Value of Property Owned on Date of Marriage
$0.00
$51,623.46
Value of Property Owned on Valuation Date
$158,100.41
$610,441.10
Minus Debts and Liabilities
Minus Net Value of Property Owned on Date of Marriage
$130,440.16
$207,702.82
$51,623.46
Net Family Property
$27,660.25
$351,114.82
EQUALIZATION PAYMENTS
Applicant Pays Respondent
$0.00
Respondent Pays Applicant
$161,727.28
75Paragraph [57] and [68] of my reasons shall be amended to include the accurate equalization payment.
76As this increased payment may reflect on either party’s costs submissions, I will permit the parties to file any additional submissions by August 14, 2015, if necessary.
Walters J.
Released: August 6, 2015
CITATION: Froese v. Froese, 2015 ONSC 4060
COURT FILE NO.: 852/11
DATE: 2015/08/06
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
COLLEEN FROESE
Applicant
- and -
ERIC FROESE
Respondent
ADDENDUM TO JUDGMENT
Walters J.
Released: August 6, 2015