NEWMARKET

COURT FILE NO.: FC-15-47643-00

DATE: 20150817

ONTARIO

SUPERIOR COURT OF JUSTICE

FAMILY COURT

BETWEEN:

Jean-Luc Petit

Applicant

– and –

Michele Ann Petit

Respondent

Jaret Moldaver, for the Applicant

Philip Viater, for the Respondent

HEARD: August 5, 2015

RULING ON MOTION

McGee J.:

Background

[1] Each party has served a motion to be heard today on the same question: who shall pay the expenses on their jointly owned matrimonial home in Stouffville, Ontario? In the alternative, each seeks an order for the sale of the home; but, neither really wants the home to be sold.

[2] Since their separation in 2013[^1], the mother and father have continued to live in the home with their four children ages 10, 12, 15 and 17. Both parents are employed.

[3] Counsels seek an order apportioning the payment of the monthly mortgage, utility and tax expenses of approximately $2,993[^2]. They concur that the court’s jurisdiction to make such an order can be found at section 24(1)(e) of the Family Law Act, R.S.O. 1990, c.F.3:

24. (1) Regardless of the ownership of a matrimonial home and its contents, and despite section 19 (spouse’s right of possession), the court may on application, by order,

(e) order a spouse to pay for all or part of the repair and maintenance of the matrimonial home and of other liabilities arising in respect of it, or to make periodic payments to the other spouse for those purposes;

[4] The father paid the mortgage, water and tax expenses during the marriage. After separation he was terminated from an excellent employment position which in 2013 paid $214,468. He continued to pay the expenses from his severance package.

[5] When the father’s severance package was exhausted, he paid the expenses with loans from his parents and earnings from his present position paying $23,762 per annum. He deposes that the loans dried up in May of this year, and that he can no longer carry all the expenses without contribution from the mother.

[6] The mortgage and taxes are now two months in arrears. Any day now, the parties anticipate the Bank taking action. Each is most anxious about what will happen next. Each seeks an order requiring the other to make payments.

[7] The father asks for an order that his contribution be capped at $1,000 per month, and that the mother be compelled to pay the balance of expenses.

[8] The mother refuses to pay any expenses from her annual income of $86,824. She firmly believes that the father intentionally found the lowest-paying job available in an effort to avoid his responsibilities. She believes that he is avoiding any opportunities to apply for better positions. She believes that he has mental health issues.

[9] The mother’s notice of motion states that she will agree to a sale of the matrimonial home if the father agrees that their four children will move to Brantford to live with her mother. The father does not consent. This appears to be the end of the inquiry as fashioned within her motion.[^3]

[10] The mother also seeks the return of $2,788 in reimbursed travel expenses deposited to the joint bank account - used by the father to pay household accounts. The court is not prepared to make an order for the return of funds on this motion. I do not have sufficient evidence of the original source of the travel funds, or the specific expenses paid – and to who’s credit each were paid.

What this Motion is Not About

[11] Mother’s counsel valiantly opposes any contribution by the mother. He further submits that an order for the sale of the matrimonial home would prejudice his client’s claims at trial to everything from lump sum child and spousal support, to a claim for unequal division of assets, exclusive possession and vesting of the home in her name alone.

[12] None of these claims are set out in the mother’s notice of motion. At best, they are perched on the far side of the litigation horizon. There is no order sought for an imputation of income per section 19 of the Federal Child Support Guideline, SOR/97-175. No net family property statement can be calculated until the mother values her considerable employment pension. No vesting order can be considered until final determinations are made on the issues of support and equalization.

What this Motion is About

[13] How does a court determine whether, and how much to order a spouse to pay for the maintenance of a matrimonial home?

[14] Section 24(1)(e) of the Family Law Act is a broad and flexible power that permits the court to order a spouse to make payments for repairs, maintenance and liabilities associated with a matrimonial home irrespective of possession.

[15] Early cases treated the provision as authority to make orders for the payment of occupation rent.[^4] More recent cases have used the section to depart from the usual approach: that the spouse who enjoys the benefits of possession is responsible for the day-to-day expenses related to the home. In those cases, the spouse not in possession has been ordered to pay the utilities, insurance premiums, mortgage and property taxes when the facts of the case would make such an order appropriate.[^5]

[16] The costs of major repairs are generally split between the parties, especially when the home is jointly owned, as the parties will equally benefit from maintaining their shared capital investment.

[17] Few, if any orders under section 24(1)(e) of the Family Law Act have been sought between two spouses in possession. Justice Wright states in the case of Rintaluhta v. Rintaluhta,[^6] that the question of who should pay the expenses should be determined,

…by the court when granting exclusive possession. In the absence of any such order there is a presumption that the person granted exclusive possession will be responsible for the normal upkeep of the premises, that is, the mortgage payments, the realty taxes, heat, hydro, telephone and the ordinary repairs that arise […]

This presumption may be rebutted by reviewing the budgets placed before the court at the time the order was made, the amount of support awarded and the ability of the person in possession to pay these expenses.

[18] The father and mother have each filed a sworn financial statement which sets out their respective incomes of $23,762 and $86,824. No child or spousal support is in pay. Exclusive of housing expenses, each deposes net-of-tax expenses that already well exceed income: $39,556 and $101,722.

[19] A review of those expenses suggests that the parties have not yet transitioned through the loss of the father’s former employment. Even together, it would be a hardship to carry the current expenses of the home. Significant adjustments are necessary. This is a worrisome reality, no doubt compounded by the vagaries of an uncertain future.

Decision

[20] I agree with Justice Wright that section 24(1)(e) Family Law Act is best considered within the framework of exclusive possession. I adopt his reasoning as to how the court ought to exercise its discretion to relieve a possessory spouse of expenses related to the home.

[21] At the same time, I do not view the operation of section 24(1)(e) of the Family Law Act as being limited to cases of exclusive possession. Allocation of expenses between two possessory spouses may also be appropriate for periods of transition between separation and the sale of the home. In such circumstances, it is my assessment that these additional questions ought also be addressed:

(a) What is the time frame for the continued joint occupation?

(b) Who will enjoy the capital benefits of the post separation expenses? Specifically, how is title held, is there a trust claim, or a claim for variation of share?

(c) Do both parties share equally in the possessory benefits?

(d) Is it appropriate to relieve a spouse who benefits wholly or in part from a post separation increase in, or the maintenance of capital; or possessory benefits, from the payment of part or all of the expenses?

[22] The time frame for continued occupancy is unknown; but it will likely endure for the 2015-2016 school year. The mother wishes the sale of the matrimonial home to be deferred until trial, or until the father consents to the children moving from the jurisdiction. The father asks for an order for sale at this time, but unenthusiastically. Both parents want a plan for the children to be in place before the home is sold. This is most sensible. The assistance of the Children’s Lawyer has just begun.

[23] As joint owners, each of the parties will equally benefit from any reduction to the principal on the mortgage, and any increase in the market value of the property. The mother makes a claim for variation of share, but in these circumstances a successful claim would not likely affect post separation capital.[^7]

[24] The parties equally benefit from continued possession. Neither party has alternative housing readily available or obvious means by which it can be acquired. Each desires to remain in close proximity to the children.

[25] Turning to the final assessment, I see no basis to relieve either spouse from a one half payment of the expenses of the matrimonial home, but for their disproportionate means. A one half payment of the expenses for the matrimonial home is simply beyond the father’s present ability to pay. The court acknowledges that it is vigorously contested whether the father has the ability to earn additional monies, but the court must work with the budgets placed before it, at the time the order is made.[^8],[^9]

[26] This may change should he be able to acquire better employment. He is encouraged to do so. The parties’ financial means to assist the children with any sort of post-secondary education, or to even continue at their present schools is uncertain at these income levels.

[27] For now, I find that the father’s proposal to cap his contribution at $1,000 per month - being approximately 50% of his gross monthly income - on a without prejudice basis and subject to a later accounting is not unreasonable. Should the parties re-amortize their mortgage, or convert it to an interest only payment pending sale, an equal contribution by the mother might well cover the pressing bank liability and create additional capacity for the short term costs of the matrimonial home.[^10]

[28] If they are not able to make adjustments to the mortgage payments, then the wife’s additional means ought to be directed in order, to the mortgage, home insurance, the utilities, and then the taxes. Any repairs are to be agreed upon in advance and paid jointly.

[29] It bears repeating that temporary orders are by no means perfect. They are intended to balance competing interests until trial; or in these circumstances, until the matrimonial home is sold.

[30] Temporary order to go:

(a) On a without prejudice basis, and subject to an accounting, the respondent, Michele Ann Petit, shall cover in this order of priority: the mortgage, home insurance, utilities and municipal taxes on 45 Geoffrey Crescent, Stouffville, Ontario; with the applicant, Mr. Jean-Luc Petit, to contribute to these expenses in the amount of $1,000 per month.

(b) The respondent shall pay the home mortgage arrears on a without prejudice basis, subject to an accounting, as quickly as possible.

(c) Any necessary repairs or capital improvements are to be agreed upon in advance in writing, and paid in equal shares.

(d) This order shall continue in effect until further court order, agreement of the parties in writing, or the sale of 45 Geoffrey Crescent, Stouffville, Ontario.

[31] Costs submissions of the father are to be served and filed with the court by August 28, 2015, response by September 11, 2015, and reply, if any, by September 18. Submissions limited to two pages exclusive of a bill of costs, or offer to settle.

Justice H. McGee

Released: August 17, 2015

[^1]: The mother states that they separated January 30, 2013, the father asserts a date of separation of May 31, 2013. The date of separation does not need to be determined on today’s motions.

[^2]: I calculated this amount by adding the monthly blended mortgage and tax payment of $2,335, to the insurance $188, water $75, furnace $95, and heat & electricity $300. These amounts are taken from parties’ Financial Statements, exclusive of telephone, cell phone and internet, repairs and maintenance.

[^3]: Neither could a mobility claim be considered within the scope of this tightly scheduled one hour motion. The mother’s claim appears to have been a surprise to the father, and he needs additional time to respond. Moreover, no details on the proposed move have been provided, such as where the children would attend school in three weeks, or how the parenting schedule would be designed. Finally, the mother chose not to serve the assigned Children’s Lawyer with her motion, so counsel for the children is neither instructed, nor present.

[^4]: For example, Goeldner v Goeldner [2004] O.J. No. 825; Koegler v. Lalonde, [2001] O.J. No. 1918 (Ont. Sup. Ct. J.), and Mott v. Morrison, [1993] O.J. No. 1047 (Ont. Ct. J. Gen. Div.)

[^5]: See for example Pinto v. Pinto, 2011 ONSC 7403 and Kim v Kim, 103 A.C.W.S. (3d) 350 (Ont. Sup. Ct. J.). Husband ordered to pay expenses on motion, obligation terminated at trial: Jesse v. Jesse, 2010 ONSC 861

[^6]: 1987 4086 (ON SC), 11 R.F.L. (3d) 397, 62 O.R. (2d) 379

[^7]: Because the parties’ ownership in the home is equal, savings are modest and the wife holds a considerable employment pension, variation of share would be expressed through an adjustment of the wife’s payment of equalization to the husband.

[^8]: Rintaluhta, supra

[^9]: If there is a claim to impute income to the father, it will be separately assessed through section 19 of the Federal Child Support Guidelines once the parenting schedule is known.

[^10]: The father seeks an order that both parties make best efforts to refinance the home mortgage. In my view, the court lacks the jurisdiction to require parties to enter into negotiations with a third party lender.