ONTARIO

SUPERIOR COURT OF JUSTICE

COURT FILE NO.: 441/04
DATE: 20151029

BETWEEN:

Victoria Lynn Pilkington
Applicant

– and –

Cyril George Pilkington
Respondent

Ines Gotal, for the Applicant

By telephone -Self-Represented

Ms. Douglas-Cummings-Counsel from the Family Responsibility Office, appearing as a friend of the Court.

HEARD: August 10, 2015

REASONS FOR JUDGMENT

COATS J.

[1] On August 10, 2015, I heard oral argument of the Respondent’s application to modify the existing spousal support and child support order. The Respondent is seeking to terminate all spousal and child support and rescind all arrears. I reserved my decision. These Reasons are my decision.

[2] The Respondent made this application under the Interjurisdictional Support Orders Act, 2002, S.O. 2002, c.13, Part IV. The Respondent resides in California. He participated in the argument of this application by telephone. The Applicant and her counsel were present in Court and Ms. Michelle Douglas-Cummings, a counsel with the Family Responsibility Office (“FRO”), attended in Court as a friend of the Court.

A. Context/Background

[3] The order that the Respondent is attempting to vary is the Order of Justice Langdon, dated July 29, 2004, which contained the following provisions with respect to spousal and child support:

12. The Respondent Husband shall pay Guideline child support for Nathan d.o.b. February 19, 1991, and Chloe d.o.b. May 27, 1992, based on his current income of $135,000.00, in the sum of $1,604.00 per month commencing August 1, 2004;

13. The Respondent husband shall pay spousal support to the Applicant Wife of $2,550.00 per month commencing August 1, 2004. There shall be no income imputed to the Applicant Wife. The effect of this order is to divide net disposable income 50-50 (DivorceMate);

14. Every year the Respondent Husband shall within 15 days furnish the Applicant Wife with proof of any bonus he received from his employer (or proof that noone has been paid as the case may be.) The Respondent Husband shall immediately pay to the Applicant 25 per cent of the gross sum of any such bonus as additional child support;

15. The Respondent Husband shall pay to the Applicant the sum of $4,650.00 (Cdn) as additional child support on March 1, 2015;

16. There shall be no arrears of child support or spousal support;

17. Annually commencing June 1, 2005, the parties shall exchange their last years’ income tax return, with legible copies of all attachments;

18. Annually, effective July 1, 2005, child and spousal support shall be adjusted using DivorceMate as above so that net disposable income (not including bonus divided as above) is shared 50-50;

19. The Respondent Husband shall keep the children insured under any policy of extended health insurance and in particular shall assist the Applicant Wife in securing payment of orthodontic benefits up to a maximum amount allowed by his extended health insurance plan for the children. The Respondent Husband shall assist in processing claims and shall see that any benefit payment in respect of a liability incurred by the Applicant Wife is straightaway paid to her. Any shortfall shall be paid pro-rata by the parties as in Paragraph 22.

20. Any life insurance policy available to the Respondent Husband through his employment shall be amended, if need be, so that the Applicant Wife is beneficiary of 50% of the proceeds in her own right and beneficiary of the remainder as Trustee for the children;

21. The Respondent Husband shall annually furnish proof on or about June 1, by means of reliable third party documents, that paragraph 19 is being complied with;

22. Any special (s.7) expenses not already provided for shall be shared between the parties proportionate to their respective incomes. The Respondent Husband’s share shall be 77.3 per cent and he shall pay his share straighaway after the Applicant Wife has furnished proof of payment.

23. Until such time as the parties are divorced, the Respondent Husband shall have the option of keeping the Applicant Wife under his extended health coverage from employment and assisting her to make claims and receive payment OR he shall pay to her straightaway after receipt of proof of payment by her, 80 per cent (not to be deducted as spousal support) of any sum she pays for usually insured services such as prescriptions, dental care, fees from drugless practitioners and the like.

24. The Respondent Husband shall pay to the Applicant Wife her costs of this motion fixed at $3,500.00 forthwith.

25. Unless this Order is withdrawn from the Office of the Director of the Family Responsibility Office, it shall be enforced by the Director and amounts owing under the Order shall be paid to the director, who shall payment to whom they are owed;

[4] The Order for support was made under the Family Law Act, R.S.O. 1990, c.F.3.

[5] According to the Director’s Statement of Arrears, as of July 28, 2015, the arrears of spousal and child support are $452,427.31, plus interest in the amount of $145.58, for a total of $452,572.89. The last payment by the Respondent appears to have been made in October 2006.

[6] The parties were married on July 28, 1984, and separated in or about August 2003. They were divorced in 2005. The parties have two children, namely Nathaniel George Pilkington, born February 19, 1991, and Chloe Elizabeth Pilkington, born May 27, 1992. It is uncontroverted that the children have lived with the Applicant since the separation.

[7] At the time of the Order the Respondent was employed with General Motors, earning $135,000 per annum (see para. 12 of the Order). The Applicant had no income and none was imputed to her (see para. 13 of the Order).

B. Summary of the Parties’ Positions

[8] The Respondent requests that all support arrears be rescinded (child and spousal) and that the ongoing periodic payments of child and spousal support be terminated. He argues that there has been a change in both his income and the Applicant’s income which constitutes a material change in circumstances. He claims to have had no income of any significance since 2006. Further, it is his position that the Applicant has had income since 2006 and that she remarried in 2008 to a person who has income and is able to share expenses with her.

[9] The Applicant’s position is that income should be imputed to the Respondent as he voluntarily left his employment and he has not made reasonable efforts to secure comparable employment despite his qualifications. She also argues that he has failed to provide adequate disclosure and therefore income should be imputed to him. She acknowledges the change in her income and argues this should have no bearing on child support and the arrears should not be rescinded. Further, she submits that any consideration of her income on the issue of spousal support should be made as of when she was served with the application to modify the Order. This occurred on September 10, 2013.

C. Applicable Statutory Provisions

[10] The Respondent was entitled to bring this application under the Interjurisdictional Support Orders Act, 2002. The provisions of the Act relevant to this determination are as follows:

Information to be considered

34. (1) In dealing with a support variation application, the Ontario court shall consider,

(a) the evidence provided to the Ontario court; and

(b) the documents sent from the reciprocating jurisdiction. 2002, c. 13, s. 34 (1).

If further information or documents needed

(2) If the Ontario court needs further information or documents from the applicant to consider making a support variation order, the Ontario court shall,

(a) send the designated authority a direction to request the information or documents from the applicant or the appropriate authority in the reciprocating jurisdiction; and

(b) adjourn the hearing. 2002, c. 13, s. 34 (2).

Temporary order

(3) When the Ontario court acts under subsection (2), it may also make a temporary support variation order. 2002, c. 13, s. 34 (3).

18-month delay

(4) If the Ontario court does not receive the information or documents requested under subsection (2) within 18 months after the request is made, it may dismiss the support variation application and terminate any temporary support variation order made under subsection (3). 2002, c. 13, s. 34 (4).

New application

(5) The dismissal of the application under subsection (4) does not preclude the applicant from commencing a new support variation application. 2002, c. 13, s. 34 (5).

Choice of law rules

35. The following rules apply with respect to determining entitlement to receive or to continue to receive support and the amount of support:

36. In determining a child’s entitlement to receive or to continue to receive support, the Ontario court shall first apply the law of the jurisdiction in which the child ordinarily resides, but if the child is not entitled to support under that law, the Ontario court shall apply Ontario law.

37. In determining the amount of support for a child, the Ontario court shall apply the law of the jurisdiction where the person liable to pay the support ordinarily resides.

38. In determining the entitlement of the applicant to receive or to continue to receive support, the Ontario court shall first apply Ontario law, but if the applicant is not entitled to support under Ontario law, the Ontario court shall apply,

i. the law of the jurisdiction in which the applicant ordinarily resides, or

i. if the applicant is not entitled to support under the law of the jurisdiction in which he or she ordinarily resides, the law of the jurisdiction in which the parties last maintained a common habitual residence.

4. In determining the amount of support for the applicant, the Ontario court shall apply Ontario law. 2002, c. 13, s. 35.

Order

36. (1) On the conclusion of a hearing, the Ontario court may, in respect of the applicant, a child or both,

(a) make a support variation order;

(b) make a temporary support variation order and adjourn the hearing to a specified date;

(c) adjourn the hearing to a specified date without making a temporary support variation order; or

(d) refuse to make a support variation order. 2002, c. 13, s. 36 (1).

Retroactivity

(2) The Ontario court may make a retroactive support variation order. 2002, c. 13, s. 36 (2).

Periodic payments or lump sum

(3) A support variation order may require support to be paid in periodic payments, as a lump sum or both. 2002, c. 13, s. 36 (3).

Reasons for refusal

(4) If the Ontario court refuses to make a support variation order, it shall give written reasons for its decision and send them to the designated authority. 2002, c. 13, s. 36 (4).

[11] The 2004 Order was made under the Family Law Act. The provisions of the Family Law Act dealing with variations are found in section 37, which provides as follows:

Application for variation

37. (1) An application to the court for variation of an order made or confirmed under this Part may be made by,

(a) a dependant or respondent named in the order;

(b) a parent of a dependant referred to in clause (a);

(c) the personal representative of a respondent referred to in clause (a); or

(d) an agency referred to in subsection 33 (3). 1997, c. 20, s. 6.

Powers of court: spouse and parent support

(2) In the case of an order for support of a spouse or parent, if the court is satisfied that there has been a material change in the dependant’s or respondent’s circumstances or that evidence not available on the previous hearing has become available, the court may,

(a) discharge, vary or suspend a term of the order, prospectively or retroactively;

(b) relieve the respondent from the payment of part or all of the arrears or any interest due on them; and

(c) make any other order under section 34 that the court considers appropriate in the circumstances referred to in section 33. 1997, c. 20, s. 6; 1999, c. 6, s. 25 (12); 2005, c. 5, s. 27 (16).

Powers of court: child support

(2.1) In the case of an order for support of a child, if the court is satisfied that there has been a change in circumstances within the meaning of the child support guidelines or that evidence not available on the previous hearing has become available, the court may,

(a) discharge, vary or suspend a term of the order, prospectively or retroactively;

(b) relieve the respondent from the payment of part or all of the arrears or any interest due on them; and

(c) make any other order for the support of a child that the court could make on an application under section 33. 1997, c. 20, s. 6.

Application of child support guidelines

(2.2) A court making an order under subsection (2.1) shall do so in accordance with the child support guidelines. 1997, c. 20, s. 6.

Exception: special provisions

(2.3) Despite subsection (2.2), a court may award an amount that is different from the amount that would be determined in accordance with the child support guidelines if the court is satisfied,

(a) that special provisions in an order or a written agreement respecting the financial obligations of the parents, or the division or transfer of their property, directly or indirectly benefit a child, or that special provisions have otherwise been made for the benefit of a child; and

(b) that the application of the child support guidelines would result in an amount of child support that is inequitable given those special provisions. 1997, c. 20, s. 6.

Reasons

(2.4) Where the court awards, under subsection (2.3), an amount that is different from the amount that would be determined in accordance with the child support guidelines, the court shall record its reasons for doing so. 1997, c. 20, s. 6.

Exception: consent orders

(2.5) Despite subsection (2.2), a court may award an amount that is different from the amount that would be determined in accordance with the child support guidelines on the consent of both parents if the court is satisfied that,

(a) reasonable arrangements have been made for the support of the child to whom the order relates; and

(b) where support for the child is payable out of public money, the arrangements do not provide for an amount less than the amount that would be determined in accordance with the child support guidelines. 1997, c. 20, s. 6.

Reasonable arrangements

(2.6) For the purposes of clause (2.5) (a), in determining whether reasonable arrangements have been made for the support of a child,

(a) the court shall have regard to the child support guidelines; and

(b) the court shall not consider the arrangements to be unreasonable solely because the amount of support agreed to is not the same as the amount that would otherwise have been determined in accordance with the child support guidelines. 1997, c. 20, s. 6.

Limitation on applications for variation

(3) No application for variation shall be made within six months after the making of the order for support or the disposition of another application for variation in respect of the same order, except by leave of the court. R.S.O. 1990, c. F.3, s. 37 (3).

D. Analysis

Has there been a material change in the Respondent’s income?

[12] I have read and considered all of the written material filed by both Parties. I have also considered the oral submissions, the legislation and the caselaw they filed.

[13] I find that there has not been a material change in the Respondent’s income. I come to this conclusion for multiple reasons, which I will summarize and then discuss in detail. The summary is as follows:

1. I find that the Respondent voluntarily left his employment with General Motors and thereby voluntarily decreased his income;

2. I find that the Respondent failed to make reasonable efforts to obtain alternate work commensurate with his education and employment experience; and

3. I find that the Respondent failed to provide court ordered disclosure.

[14] For these reasons I find that the Respondent has not established that there has been a material change in his income. As such, I infer that his income remains at $135,000 and impute this income to him.

[15] With respect to the first finding, the Respondent acknowledged in his oral submissions that he voluntarily left General Motors in 2005 because he was unsatisfied with his work and wanted to pursue his own spiritual happiness. He embarked on a spiritual journey. He confirmed that his departure from General Motors was voluntary. His position had been reclassified from a level nine to a level eight, but he was not terminated, laid off or let go. He left voluntarily. The documents he filed confirm this. The documents also confirm he was paid his salary until September 2006. I do not accept his reasons for leaving this job. He had dependents – a former spouse and two young children. He filed no medical documentation suggesting he was unable to perform his duties at General Motors. He had a duty to earn what he was capable of earning. Income is imputed to him on this basis.

[16] I find that the Respondent became intentionally unemployed when he left General Motors and that he has intentionally remained either unemployed or underemployed since. His actions since he left General Motors are more fully discussed below. I find that his actions in leaving General Motors were intentional as defined in Drygala v. Pauli (2002), 2002 41868 (ON CA), 61 O.R. (3d) 711 (C.A.).

[17] The Respondent has chosen to earn less than he is capable of earning and/or chosen not to work when he is capable of working. He has not justified his voluntary decision in a compelling way: see Thompson v. Gilchrist, 2012 ONSC 4137. See also Filippetto v. Timpano, 2008 3962 (ON SC), [2008] O.J. No. 417 (S.C.); Reil v. Holland (2003), 2003 3433 (ON CA), 67 O.R. (3d) 417 (C.A.); Hagner v. Hawkins, 2005 43294 (ON SC), [2005] O.J. No. 4975 (S.C.); Weir v. Therrien, 2001 28136 (ON SC), [2001] O.J. No. 2612 (S.C.); Dang v. Hornby, 2006 12973 (ON SC), [2006] O.J. No. 1634 (S.C.); and Vitagliano v. Di Stavolo, 2001 28202 (ON SC), [2001] O.J. No. 1138 (S.C.).

[18] The second basis upon which to impute income to the Respondent is that I find that the Respondent did not try to obtain employment at the level of his position at General Motors or commensurate with his education and experience once he left General Motors.

[19] The Respondent has a degree in computer science and an M.B.A. He was employed as a senior manager at General Motors for 22 years. On the Respondent’s website, www.cypilkington.com, the Respondent describes himself as having spent 20 years in the automotive industry as a senior manager for a Fortune 50 Company in multiple locations spanning two countries. The Respondent did not deny that this was his website. According to his website, the Respondent wanted to leave “Corporate America”. He wanted to try to find more spiritually rewarding endeavors. Unfortunately, none of these endeavors generated comparable income or much income at all. Even if it was reasonable for him to leave his employment, which in my view it was not for the reasons set out above, he had a duty to engage in a reasonable job search and he did not. I ordered him on February 4, 2014, to provide “Proof of all efforts to find employment since 2005 including copies of all applications sent in and responses received and provide a copy of his current C.V. and/or resume.” He provided nothing. In his written responses to my February 4, 2014, Order, the Respondent states the following:

When I left GM I attempted to do direct selling home based jobs, first with Liberty League, a self-help and motivational company in the states I was with them for about a year. I made no money with them as did most of team I was on so we left that company and moved to Wealth Masters International out of Houston Texas, I was with them for about a year and made less than $10,000, far less than my expenditures for marketing and buy in , in essence I lost money. I took a position after that with Yaktivate, a podcasting company that had just started up and it was in prelaunch. They were working on funding and my position was to later be paid a salary that has never materialized. I worked with them for about 6 months. This led me to align with a financial group as a broker for private placement programs and commodity sales. I came close to a successful transaction 3 times during the next 3 years but never got one over the goal line. I attempted to run my own business doing websites and online marketing but it never generated any real money, a few hundred a month at times. It wasn’t until 2013 that I came upon a position as a referral by a friend to help a local Doctor grow his struggling business through online marketing and fulfillment of orders. I am currently working with him doing order fulfillment.

[20] This response does not fulfill the requirement of my Order of February 4, 2014. In his application the Respondent states “I have been unemployed since 2005.” Clearly he has not been unemployed and his response is entirely inconsistent with his application. His credibility has been substantially compromised. Further, the efforts he describes have not yielded him income commensurate with his education and experience and with his obligation to support his former wife and children.

[21] According to his website, the Respondent “quit Corporate America to find true happiness and freedom living life on more spiritual terms.” He did so at the expense of his family. He has an obligation to use his education and job experiences to maximize his income. He has not done so for over ten years.

[22] The Respondent claims his current income to be $1,600 per month from NovaLife Inc. This income from NovaLife is paid by Dr. Scheele. The Respondent also acts as a property manager and pays reduced rent in return. I find that the Respondent has not maximized his income potential. He has deliberately made a choice to lead a more spiritually enriching life. He cannot do so at the expense of his family – particularly his children: see Lawson v. Lawson (2006), 2006 26573 (ON CA), 81 O.R. (3d) 321 (C.A.); Evans v. Gravely, 2000 22593 (ON SC), [2000] O.J. No. 4748 (S.C.); and the cases referred to in para. 15 above).

[23] Thirdly, I find that the Respondent’s disclosure is so problematic that it cannot be relied on to determine that his income has materially changed. A summary of only some of the problems with his disclosure is as follows:

1. In his initial application the Respondent claims to have “Pensions, retirement” income in an amount of less than $1,000 a month and income from alternative healing in the amount of $200 to $500 per month. This application is dated March 28, 2013. He also claimed in his initial application that he received a lump sum payout of his pension in 2007 and says ‘none’ beside the pension and retirement plan asset category. From where does he derive the pension or retirement income of less than $1,000 per month? He states in his written response to my February 4, 2014, Order that he exhausted his pension money between 2007 and 2010. So where is this income coming from in 2013? On February 4, 2014, I ordered him to provide the following with regard to this: “Sworn evidence as to any pension or retirement gratuity he received including documentary confirmation of same” and “Confirmation of all assets owned currently including retirement plans” and “Documentary confirmation of present income.” He did not provide this. The documents he provided regarding his pension show a lump sum option was available upon his leaving General Motors but do not confirm that he chose it. Further, they do not explain the “<1000” pensions, retirement income he claims to have had in 2013.

2. In the same application he stated he had been unemployed since 2005. The Applicant has attached to her affidavit pages from the website for a business called “UGottawanna, LLC”. This website lists the Respondent’s personal email among its contact information. The Respondent did not deny that the website or the email address related to him. According to this website, the Respondent provides spiritual energy healing for a standard fee of $100 per hour. Documents related to UGottawanna reveal that the business also offers hosting web-design and e-commerce services. The Applicant filed a copy of the Respondent’s LinkedIn profile, which describes the Respondent as the owner of “UGottaWanna.” His LinkedIn profile indicates that he has owned this company since March 2005. According to his LinkedIn profile, the company is involved in “Connecting the dots in international trade of commodities and banking programs.” His LinkedIn profile also lists his previous employment experience. According to this list, he was a “Business Partner” at Life Force Connection from February 2009 to January 2010; he was an executive V.P. of HR at Yaktivate.com from April 2008 to May 2009; and he was a Core Team Partner at LifeBeatProducts from January 2008 to January 2009. The Respondent has not satisfactorily explained the huge discrepancy between his statement that he was unemployed from 2005 until 2013, when he started with NovaLife Inc., and his LinkedIn page. Of particular note is that the Respondent did not disclose these documents. The Applicant found them online and filed them.

3. The Respondent never disclosed his role as a property manager and the rent reductions he receives in return. The Applicant raised this in her Affidavit of May 27, 2015, after being informed of this by their son. The Respondent admitted this in oral submissions. However, the Respondent never mentioned this prior to the Applicant putting this forward.

4. On February 4, 2014, I also ordered the Respondent to produce “Copies of all income tax returns and attachments from 2004 to present filed in Canada and/or the U.S.A. and confirmations/assessments received back from the I.R.A. or Revenue Canada.” He produced none of these documents. The Respondent claims he did not have enough income to require him to file. This cannot be accurate. He continued to be paid by General Motors until September 30, 2006. He would have had to file for at least 2004, 2005 and 2006. He has filed a letter claiming that since August 1, 2013, he makes $1,600 per month from Dr. Scheele. This is in addition to the “<1000” “pensions, retirement” income he claimed in his application. Surely he would have had to file a tax return for at least some years.

5. The Respondent stated in Court he has no ongoing connection with a company called Life Force Connection. This company is referenced in his LinkedIn profile, which indicates he was a business partner from February 2009 to January 2010. His profile is still on the company’s website. He has not satisfactorily explained this.

6. The Respondent was ordered to provide bank records. The records show deposits from Amazon.com. During oral argument, the Respondent claimed that these deposits relate to someone else’s sales, not his own. This is completely undocumented and was never disclosed or verified. Further, the Respondent has not explained certain cash deposits or the many “check deposits” to his account during a time he claims he was unemployed.

7. The Respondent’s bank statements do not show regular deposits from his work with Dr. Scheele. This is unexplained. It is unknown where his salary has gone or if he is being paid in cash.

8. The bank statements also show deposits from Paypal and Square Inc. The Respondent never explained these deposits.

9. Of particular concern regarding the Respondent’s bank account statements is his total unexplained deposits. For example, the Respondent deposited at total of $3,352 between September 19, 2012, and October 16, 2012, yet he claims he was unemployed during this period. A further example is the $1,500 he deposited on February 5, 2013, and the $2,093 he deposited between January 17, 2013, and February 15, 2013.

10. The letter the Respondent provided to confirm his income from NovaLife Inc., signed by Dr. Scheele, is dated August 1, 2013. This has not been updated.

11. The Respondent signed his application on March 13, 2013, indicating he had less than $1,200 a month in income, yet from February 16, 2013, to March 15, 2013, he deposited $3,921.20 to his bank account. From March 16, 2013, to April 15, 2013, he deposited $4,674.35. His application is simply not credible. Where did the cheque in the amount of $3,566, deposited on April 1, 2013, come from? No answer has been provided.

[24] It is appropriate to impute income when a payor has not produced proper or meaningful financial disclosure. I draw an adverse inference against the Respondent based on his problematic disclosure outlined above: see Smith v. Pellegrini, 2008 46927 (ON SC), [2008] O.J. No. 3616 (S.C.), and Maimone v. Maimone, 2009 25981 (ON SC), [2009] O.J. No. 2140 (S.C).

[25] For these reasons I find that there has been no material change in the Respondent’s financial circumstances. I impute to him the same income he had in 2004: $135,000 gross per year. In my view, this is conservative. It reflects no increase over many years and in his role at General Motors he received bonuses and a car allowance which I have not accounted for.

[26] I also find that the Respondent has no medical impediment to working. He filed his own note about a bike incident in November 2014, but filed no medical report to indicate that this in any way impaired his ability to work.

ii) Has there been a material change in the Applicant’s circumstances?

[27] I do find that there has been material change in the Applicant’s financial circumstances. At the time of the 2004 Order the Applicant had no income. According to her Affidavit sworn May 27, 2015, at the time of separation she had been out of the workforce for twelve years. She enrolled in a program to upgrade her employment skills and in 2006 graduated from a two-year Pharmacy Technician Program at Humber College. She has been employed as a pharmacy technician at Trillium Health Partners – Mississauga Hospital since 2006.

[28] According to the Applicant’s Financial Statement sworn May 27, 2015, her yearly gross income from employment is $61,027.92. She can work part-time, as needed, with the Pharmacy Examining Board of Canada. She estimates this part-time work will generate income of $4,992 this year. According to her 2014 Notice of Assessment, her Line 150 total income was $69,908.

[29] The Applicant remarried in 2008. According to the Applicant’s Financial Statement, her spouse earns $148,000 per year and she states “My spouse and I each deposit our incomes into a joint account and virtually all of the household expenses are paid from that account.”

[30] In my view, what amounts to a material change in the Applicant’s circumstances is that she retrained, obtained employment, and is now in a relationship where she is sharing the payment of expenses. In my view, the Respondent has established that this change in circumstances, if known in 2004, would likely have resulted in different terms: see Allaire v. Lavergne, 2014 ONSC 3653, with reference to Willick v. Willick, 1994 28 (SCC), [1994] 3 S.C.R. 670, and L.M.P. v. L.S., 2011 SCC 64, [2011] 3 S.C.R. 775.

iii) Has there been a material change in the circumstances of the children?

[31] There has been a material change in the circumstances of both children. Nathan attended a full-time program in Construction Trades Techniques at George Brown College from September 2010 to April 2012. The tuition, supplies and transportation fees for Nathan were submitted to the FRO in 2011. It is uncontroverted that Nathan continued to live with the Applicant while he attended school. The child support enforcement for Nathan was terminated on consent by the FRO in 2011, although Nathan continued at school for some months thereafter.

[32] Chloe began a four year program at the University of Toronto in 2011. Chloe stayed in residence while pursuing her degree but visited regularly with the Applicant on weekends and holidays (Christmas break and spring break) and stayed with the Applicant during the summers. The Applicant has advised the FRO to stop enforcing support for Chloe effective August 2015. Chloe’s tuition and residence fees were $68,590.80 for the four years. It appears that no school fees have been enforced through FRO for Chloe.

iv) Given these findings what variation order should be made?

[33] No variation is necessary to reflect the change in circumstances with respect to the guideline support for Nathan. I have imputed income to the Respondent at the same level as in 2004 throughout the period from 2004 to present.

[34] Nathan’s entitlement to support is determined under Ontario law as set out above. He was a full-time student when enforcement was terminated. Arrears for Nathan are only included in the FRO Director’s Statement for Nathan until October 2011.

[35] With respect to Nathan’s education costs, the only claim in this regard was added to the FRO enforcement in October 2011. The Respondent could argue that I should change the parties’ proportionate contributions to the education costs based on the Applicant’s income in 2010 and 2011 when the expenses were incurred. I am not prepared to do so for several reasons. First, the Respondent did not bring this application until March 2013 and the Applicant did not have notice of the application until September 2013. It is not reasonable to look behind when the Applicant had notice, particularly given the state of the Respondent’s disclosure as detailed above, which is still incomplete. Second, the child continued at school full time after October 2011 until April 2012. Any overpayment of a percentage of school expenses is offset by an underpayment of base child support. There shall be no reduction in the arrears owing by the Respondent to the Applicant for Nathan with regard to either base child support or education expenses.

[36] With respect to Chloe, again I am not prepared to look behind September 2013, when the Respondent gave notice of this proceeding to the Applicant. For almost two years thereafter the Applicant continued to claim full base guideline support for Chloe even though she lived in residence for a portion of the year (I estimate she lived in residence eight months out of twelve over a year). Arrears accumulated with the FRO at $1,007 a month for Chloe during the period from September 2013 to August 2015. The arrears are therefore overstated by $16,112, or $1,007 multiplied by the 16 months Chloe was living in residence during this period. This overstatement of arrears will be offset by the Respondent’s contribution to Chloe’s education costs, as detailed below, resulting in no actual reduction in the arrears.

[37] With respect to Chloe’s education costs, again I am not prepared to consider any variation prior to September of 2013, when the Applicant was notified of the present procedure. Chloe’s residence and tuition costs were $68,590.80 over four years, an average of $17,147 per year. None of these costs are reflected in the Director’s Statement of Arrears. For the 2011-2012 and 2012-2013 school years, the Respondent owes 77.3 percent of these costs to the Applicant (see para. 22 of the Order). Therefore the Respondent owes to the Applicant the sum of $26,509.26, which shall be added to the arrears to be enforced by the Director. This is not a variation, it is a qualification of the previous order.

[38] For Chloe’s 2013-2014 and 2014-2015 school years, the Respondent’s contribution would have been less because the Applicant’s income should be considered in determining his proportionate contribution. His contribution is being offset by the base child support overstatement referenced above. As a result the Respondent shall not file with FRO any claims for Chloe’s education costs for these two school years.

[39] I have not considered any variation before the date of effective notice (September 2013) with regard to child support as it relates to Nathan’s education costs and Chloe’s guideline support and education costs: see D.B.S. v. S.R.G., 2006 SCC 37, [2006] 2 S.C.R. 231, with the same principles applied to retroactive rescission of arrears in (M.) D. v. (A.) S., 2008 NSFC 15. There is no reason in this case to go behind the date of effective notice given the Respondent’s conduct, which includes leaving his job, not seeking appropriate employment, not providing accurate disclosure and not paying any meaningful support since 2006, even though by his own account he spent his pension payout and has had employment from time to time.

[40] Both children remained entitled under Ontario law when arrears were accumulating through FRO. For the reasons set out above, there is no reason to vary the child support order to reflect any change in the circumstances of the children or any change in the circumstances of the Applicant. There is no necessity to resort to California law in terms of the quantum of child support as there is no variation.

[41] With respect to the Respondent’s claim to terminate spousal support and rescind arrears that have accumulated since 2006, the Respondent has established material changes in the Applicant’s financial circumstances. In the circumstances, I find that the Applicant’s entitlement to spousal support shall terminate effective September 1, 2013, which is approximately the date of effective notice to the Applicant of the Respondent’s request. Arrears that have accumulated since September 1, 2013, are rescinded. I order no rescission of arrears for any period prior to September 1, 2013.

[42] I am terminating support, as I find that by 2013 the Applicant had achieved self-sufficiency. She had retrained by upgrading her education, obtained employment and maintained employment over a period of years. She has had steady increases in her income. She had been remarried five years by 2013 and shares expenses with her spouse. She has accumulated savings, RRSP’s and equity in her home. She was 41 at the time of separation. To her credit she has used the time since the separation wisely to establish herself financially.

[43] In my view the termination of spousal support in September 2013 is consistent with the purposes of a spousal support order as set out in section 33 (8) of the Family Law Act, which is applicable on variations in accordance with section 37 (2) of the Family Law Act. An order of nine years duration in the circumstances I have described meets these objectives.

[44] In terms of my terminating support effective September 1, 2013, and not before, this is in part based on the same rationale outlined above for using the effective date of the notice to the Applicant with regard to child support. All of the same reasons apply and there are additional reasons for my choosing this date and not an earlier date regarding spousal support. The Respondent wants all spousal support arrears rescinded. This would be back to 2006 and would effectively mean the Respondent would have paid approximately two years of spousal support after a long marriage, with a wholly financially dependent spouse who had not been employed outside the home for many years of the marriage. This is untenable. After the separation, the Applicant became virtually solely responsible for the care and upbringing of the children. The Respondent chose to pursue his life in California.

[45] I am not terminating the spousal support automatically as a result of the Applicant’s remarriage in 2008. As Justice Turnbull summarized in Franz v. Wilson, [2005] O.J. No. 3478 (S.C.), at para. 5, “Remarriage usually constitutes a material change in circumstances sufficient to trigger a variation application. However, recent caselaw confirms that the remarriage of a spouse who is the recipient of spousal support does not automatically mean that support should be terminated.” Justice Turnbull then goes on to list various factors to consider. Applying these factors to the case before me, I find that the Applicant’s remarriage in 2008 did not disentitle her to spousal support at that date or justify a reduction at that time. The 2004 Order clearly had a compensatory focus. The Applicant had no income. The Respondent had considerable income. The Applicant was not employed. The Respondent had steady, well-paying employment. The Applicant was a stay at home mother. The Respondent was the primary breadwinner. The Applicant was economically disadvantaged by the separation. She was the primary parent for the children after separation. This compensatory basis required spousal support to be paid over a significant period of time. The Applicant self-sufficiently evolved over time. She had to retrain. She had to secure employment. Her job had to be stable. Her independence from the Respondent was not established solely by her remarriage. Her relationship had to be secure over time. It took time for the economic disadvantages to reverse or be compensated for. I note the Applicant did this herself after 2006, as the Respondent has not paid spousal support since then. To rescind the arrears before 2013 would be to erase the financial assistance the Applicant was entitled to receive from the Respondent based on the events of their marriage and its breakdown.

[46] There is no suggestion that the Applicant hid her remarriage or her finding employment from the Respondent. He never suggests this. In his initial application he refers to both her employment and her subsequent marriage, revealing his knowledge of both. The Applicant bears no responsibility for the Respondent’s delay in bringing these proceedings.

[47] In my view, Reisman v. Reisman, 2014 ONCA 607, has no applicability to the circumstances of this case. It concerns the settling of terms of an order and, in any event, the Court’s comments on remarriage are consistent with Franz v. Wilson.

[48] The Respondent submitted the case of Jackson v. Jackson (1984), 1984 1781 (ON CJ), 25 A.C.W.S. (2d) 74 (Ont. C.J.), for the proposition that support modification or termination may be warranted where the arrears are exceedingly large, creating undue hardship on the payor. The case was decided under the Family Law Reform Act, R.S.O. 1980, c. 152. In any event, this aspect of the Jackson case is distinguishable from the present case. At para. 17 of Jackson, Justice Vogelsang stated the following:

It is sufficient to say that, in the myriad possible fact situations that lead to applications of this nature, the existence of an exceedingly large amount of arrears could be a potent argument in favour of substantial discharge from payment where it would be totally unreasonable to expect probable satisfaction within the economic capability of the person paying.

[49] I have imputed income to the Respondent. It cannot be totally unreasonable to expect the Respondent to pay the arrears. He is capable of earning significant money and has not established otherwise.

[50] In all of the circumstances, the Respondent’s obligation to pay spousal support to the Applicant is terminated effective September 1, 2013, and arrears that have accumulated thereafter are rescinded.

[51] I did consider the Applicant’s proposal to reduce spousal support to $1.00 per month. I reject this as in my view there is no further entitlement for the reasons I have expressed. I have considered Moge v. Moge, 1992 25 (SCC), [1992] S.C.J. No. 107, and Cassidy v. McNeil, 2010 ONCA 218, [2010] O.J. No. 1158. The principles set out in these two cases, applied to this case, as I have outlined above, result in my findings.

E. Conclusion

[52] In conclusion I order as follows:

(1) That there shall be no rescission of child support arrears relating to Nathan;

(2) That $25,509.26 shall be added to the arrears to be enforced by the Director for the Respondent’s contribution to Chloe’s education costs for 2011-2012 and 2012-2013;

(3) That the Respondent shall not file with the FRO any claims for Chloe’s education costs in 2013-2014 and 2014-2015;

(4) That there shall be no rescission of child support arrears relating to Chloe;

(5) That the Respondent's obligation to pay spousal support to the Applicant is terminated effective September 1, 2013;

(6) That any spousal support arrears that have accumulated after September 1, 2013, shall be rescinded; and

(7) SDO to issue.

[53] With respect to costs, the Applicant may serve and file brief (three pages, double spaced) written costs submissions with a bill of costs attached within 30 days of today; the Respondent may serve and file brief (three pages, double spaced) written response costs submissions within 60 days of today; and the Applicant may serve and file brief (one page, double spaced) written reply costs submissions within 90 days of today. Service shall be affected through I.S.O. office.

Coats J.

Released: October 29, 2015

COURT FILE NO.: 441/04
DATE: 20151029

ONTARIO
SUPERIOR COURT OF JUSTICE

BETWEEN:

Victoria Lynn Pilkington
Applicant

– and –

Cyril George Pilkington
Respondent

REASONS FOR JUDGMENT

Coats J.

Released: October 29, 2015