Benevento v. Benevento, CITATION: 2015 ONSC 6707
COURT FILE NO.: D24480/14
DATE: 2015-10-26
SUPERIOR COURT OF JUSTICE – ONTARIO
RE: Brenna Lynne Benevento, Applicant
AND: Robert Benevento, Respondent
BEFORE: Mr Justice Ramsay
COUNSEL: Ms. P. Mahdi for the Applicant; Mr Luigi De Lisio for the Respondent
HEARD: October 13 – 16, 2015
ENDORSEMENT
[1] The parties began living together in 2000. They had a son in 2001 and a daughter in 2003. They married in 2005. They separated on September 13, 2013. The applicant wife seeks a divorce, custody of the children with liberal access to the father, child support, spousal support and equalization. The respondent husband seeks joint custody of the children, residence shared equally between the parents, and partition and sale of the matrimonial home. At the end of the evidence the parties, both consenting, were given permission to make submissions in writing. I have received the submissions of the Applicant and the response of the Respondent. I do not propose to consider reply by the Applicant.
Date of separation
[2] The parties both still occupy the matrimonial home. In June 2013 they were contemplating splitting up. The respondent asked the applicant to spend the summer with the children at their summer place, so that he could think things over. After Labour Day the family reunited in the matrimonial home. By September 12, the parties had told each other that they were consulting lawyers. The Respondent moved into a separate bedroom and normal marital relations have never resumed. I find the date of separation to be September 13, 2013. The Respondent has never articulated any cogent reason why the date of separation should be fixed at any other time.
Equalization
[3] The applicant says that the respondent owes her an equalization payment of $288,000. The respondent says that he owes her $82,000. The parties agree on the amounts to be entered into the equalization calculation except for five items.
Form 13C 1. (a) – matrimonial home
[4] The Applicant puts the value of the matrimonial home at $202,500 each. The Respondent puts it at $180,000 each. The amounts cancel out so it does not matter for purposes of equalization. The only conclusive way to determine the value of the matrimonial home is to sell it on the open market.
Form 13C 1. (b) – the Corvette
[5] The respondent owned a 2007 Corvette. After separation he gave it to his grown son from his first marriage. The applicant says it is worth $40,000. The respondent says it is worth $25,000. The best evidence that I have is the appraisal by a licensed appraiser that was submitted by the Respondent. I fix its value at $25,000 in the Respondent’s column.
[6] The vehicles used in the Respondent’s business are all owned by him personally. The Applicant estimates their value at about $226,000 but has not given me much to go on. The Respondent says that the vehicles are worth $42,000, but according to his business valuator, the company, presumably the Respondent, gave him, the valuator a value of $121,000. They must be worth at least that much. I fix their value at $121,000 in the Respondent’s column.
Form 13C 1. (e) – the roofing business
[7] The Respondent’s expert valuator says that the business is worthless. There is no market for it because any value belongs to the Respondent and his personal goodwill. It is clear however that the Respondent did not give the expert accurate information. The expert opinion is not useful. The company must be worth at least its assets minus its liabilities. On the evidence of the books and the present bookkeeper, that would be $101,877.53. It is a simple matter of subtracting debts and owing taxes and WSIB claims from money in the bank and accounts receivable. It is necessary to discount the accounts receivable, but only by a small amount, because on the evidence the company has a history of collecting its accounts receivable. The 4% suggested by the Applicant is a reasonable amount. I fix the company’s value at $101,877.53 in the Respondent’s columns.
Form 13C 2. Debts – matrimonial home
[8] The Respondent is not entitled to deduct amounts added to the joint line of credit without the Applicant’s consent after separation. I accept her amount of $25,695.46 each for the line of credit on the matrimonial home. Nor can the Respondent double count the money owed to the CRA, because he paid off this debt after separation by withdrawing from the joint line of credit without the Applicant’s consent.
[9] I do not accept that there was any money owing on the Bellevue mortgage. The Respondent’s $42,500 is reduced to zero. The documents suggest that the loan should have been repaid long before the date of separation. I am not prepared to accept the Respondent’s word to the contrary. He has been so inconsistent in what he says about money and assets that his bare recollection is not credible.
[10] The amounts based on my findings of fact results in the following statutory calculation:
Applicant
Respondent
TOTAL 2: Debts and other liabilities
40,479.95
84,383.46
TOTAL 3: Value of property owned on date of marriage
NIL
77,000
TOTAL 4: Value of excluded property
NIL
NIL
TOTAL 5: (TOTAL 2 +TOTAL 3 + TOTAL 4)
40,479.95
161,383.46
TOTAL 1: Value of property owned on valuation date
269,936.81
847,274.81
Less TOTAL 5
40,479.95
161,383.46
TOTAL 6: Net Family Property
229,456.86
685,891.35
[11] The Respondent’s Net Family Property exceeds the Applicant’s by 456,434.49. Half of that amount is $228,217. I order the Respondent to pay the latter amount to the Applicant by way of equalization, with pre-judgement interest at the statutory rate from September 12, 2013.
Custody
[12] On the Applicant’ evidence, she has always taken care of the children’s daily needs while the Respondent earned the money to support the household. She says that the respondent is a loving father, who used to spend time with the children in the evening between the time he came home from work and their bed-time. He has also been interested in the son’s hockey. Since separation, during which time the parties have been living separately in the matrimonial home, he tends to leave at six or seven in the morning and not to come back until 11 at night, unless she is not there. Her problem has been that he does not see the children enough. In particular, when she works the late shift on Saturday nights, he will not help out. On at least one occasion, his attitude is clearly shown in text messages between the parties. His “I have plans,” trumped her need to work and the children’s needs as far as the Respondent was concerned. The text messages in general support the wife’s account of the general nature of the roles that have been, and still are played by each parent. It makes no sense to me to change the regime at this point by giving so much responsibility to the parent who has never before shown any interest or aptitude in assuming it. I find it hard to imagine this man all of a sudden making dinner, doing laundry and helping with homework for a whole week every other week. His only plan to cope with work is that the children are old enough to be left alone. The children are well taken care of by their mother. As she says, they also need to spend time with their father. The Applicant sees no reason why they cannot work out holidays, hockey tournaments and so on. I agree with her.
[13] I do not think that the Respondent has the maturity to put the children before himself. When asked why he did not pay for Riley’s orthodontics, the need for which he accepted, he said that it was because the Applicant annoyed him by constantly telling him that it would not cost him anything. He was right that it would cost him something. All he would get from his insurance was a legitimate tax deduction, less a fee to the insurer. But to put off needed dental care when he could well afford it on account of being annoyed with the Applicant struck me as very immature and short-sighted.
When the parties separated, the Respondent moved into the daughter’s bedroom, leaving her without a bedroom at this stage of life when young people begin to look to differentiate themselves from their parents. In her middle school years she is left sharing a bedroom with her mother. There would have been plenty of room in the basement for the Respondent or some other separate residence, including his parents’. The Respondent says that he chose to stay in the house to protect the children from their mother’s drunkenness. I do not believe that he thought there was any need to do so. He left them with their mother too much for that to be the case, and I do not think she is anything more than an occasional social drinker. His other explanation for taking his daughter’s room tells me a great deal. Referring to the Applicant, he said, “She took my room.” This is the response of a child, not a parent.
Child support
[14] Child support should be paid in the table amount. The question is, “what is the respondent’s income?” The Applicant submits that I should impute income of $246,000 a year. The Respondent testified that his true income is $100,000 per year. That amount of income is inconsistent with his lifestyle and the income produced by his company. It is also a very recent assertion, and the last in a series of inconsistent estimates. The amount grew from $35,000 a year to $67,000 a year by the first day of the trial. After the former bookkeeper produced the company’s general ledger, the Respondent increased the amount to $100,000 a year in yet another financial statement filed on the last day of the trial. His opinion of how much he makes is not reliable. He has not been consistent and the amount he finally conceded is not enough to finance the lifestyle that the parties have been living.
[15] The parties live in an expensive house with a swimming pool. They both drive nice cars. They have a motorboat. They have several income-producing properties. They have a camping trailer that they tow and a trailer home that they park at Sherkston shores. They spend $6,000 a year on hockey for their son and they used to spend about the same amount on dance for their daughter. They travelled. They entertained. And so on. During the marriage the Respondent never complained about money. According to the former bookkeeper, he once complained to her about money in 2011, a slow year, but things got better soon because of a great volume of work generated by a wind storm that left a lot of roofs in need of repair.
[16] The respondent owns a business. According to the former bookkeeper, he used to be paid by many customers in cash, and he sometimes instructed her not to enter those amounts in the books. On the amounts that were entered into the books, his roofing company typically might gross $1.5 million in a year. According to her, typically a quarter of that or $375,000 would be profit. The respondent is the sole owner of the business. All the profit is his. He drew very little money from the business in the form of recorded shareholder draws. Instead, he had the business pay for many of his personal expenses, including the parties’ personal credit card bills.
[17] I have to be careful with the former bookkeeper’s evidence because she is now estranged from the Respondent, whose complaint led to her being charged with defrauding him. Those charges are still outstanding. Also, on her evidence, she was his accomplice in defrauding EI, a matter which has not been the subject of a police investigation. However, on the records she produced, the Respondent is making significantly more than he claimed. These records are the product of software that records when changes are made to it. The former bookkeeper’s printout of this self-check function satisfies me that she has not tampered with the books. I also accept that the Respondent does a certain amount of business off the books.
[18] Looking at his claimed income and expenses, together with the substantial amounts that he took from the business for personal items, he must be taking home at least $150,000 a year. Grossing that up to take into the fact that he would need to earn more before tax to take home that amount, his income would be more like $245,000 a year. I am not convinced, however, that the amount should be grossed up to that extent, because I do not think the Respondent pays all his tax. He prefers to use the business as his personal wallet, without adequate documentation and with admittedly unorthodox bookkeeping practices. On the totality of the evidence, including the evidence about undisclosed cash income, I impute an annual income of $200,000 to the Respondent. Accordingly I fix child support at $2,582 a month.
Extraordinary expenses
[19] After separation the Applicant borrowed money to pay $10,426 for orthodontics and $1,355 for dental care for the children. She should not have had to do so. At the time her income was negligible. I do not accept the Respondent’s explanation for failing to pay these amounts long ago. The work was necessary and for him it was affordable. I order the Respondent to pay the applicant 100% of these amounts forthwith as extraordinary expenses.
[20] The Respondent is ordered to pay future orthodontics, dental care and prescription medicine for the children in proportion to the parties’ respective incomes.
[21] The parties can sort out what extracurricular activities, if any, the children should undertake and who is to pay for them. There is no need for hockey or dance, which are very expensive. If the parties want to pay for these activities, they are free to do so, and to agree as to how they should be shared.
Spousal support
[22] When she met the Respondent, the Applicant was a waitress. She became a stay at home mother from shortly before the birth of their son. When the daughter was in school full time, the applicant went to work in the family business. She worked in the office some mornings. Later she went back to waiting and bartending a few hours a week. After separation she picked up an extra shift. She earned about $9,000 a year most recently. She now has more hours and should be able to make $24,000 a year, in my view. But she would like to take some post-secondary education to get herself an office job with daytime hours. I see nothing unreasonable in her looking for a day job that would let her be home for her children at this point in their lives. It is also reasonable for her at this point to be looking for a less physically demanding job. I think her best option is some form of office administration or bookkeeping course. Until now, she has had neither the time nor the money. At present the Respondent is only providing shared use of the matrimonial home and $900 a month in temporary child support.
[23] The Applicant is owed compensatory spousal support. Her contribution required her to forego earnings and postpone education that would have enabled her to improve her position. The Respondent gained considerably from this. He and his children were taken care of, which allowed him to focus on earning money. When the applicant went to work in the business, he gained a part-time employee who was also the source of a tax write-off. The Applicant has been compensated by equalization, but only in part.
[24] I see no reason to depart from the SSAG figures. I order an amount in the mid-range, which I fix at $3,500 a month indefinitely.
[25] Since the husband has been paying the expenses of the matrimonial home, I do not propose to order retroactive monthly spousal or child support.
Partition and sale of the matrimonial home
[26] If the parties cannot agree for one to buy out the other, the home must be sold. I order the partition and sale of the matrimonial home forthwith. The present situation is not good. The Respondent needs to make way for his daughter to have her own bedroom. Since the applicant will have the children, I give her exclusive possession of the matrimonial home until it is sold.
[27] I direct that the proceeds of sale due the Respondent be kept in trust unless their release to him is authorized by order of this court or consent of the parties.
Orders
[28] I order as follows:
a. Custody of the children to the applicant with liberal access to the Respondent including alternate weekends and one weekly evening or overnight visit as agreed by the parties.
b. Child support payable by the Respondent for Riley Benevento born 2001-12-26 and Madyson Benevento born 2003-08-16 at a rate of $2,582 per month commencing October 1, 2015 based on an imputed annual income of $200,000.
c. Extraordinary expenses for the children payable by the Respondent to the Applicant as follows:
i. $11,781 for orthodontic and dental care forthwith;
ii. 70% of future orthodontic, dental, drug and medical expenses.
d. Spousal support payable by the Respondent fixed at $3,500 per month commencing October 1, 2015.
e. A support deduction order will issue.
f. The matrimonial home shall be partitioned and sold forthwith. The proceeds due the Respondent shall be kept in trust until their release to him is authorized by court order or the consent of the parties. Until the home is sold, the Applicant has exclusive possession thereof.
g. As equalization of Net Family Property the Respondent shall pay to the Applicant $228,217 with pre-judgement interest at the statutory rate from September 12, 2013.
[29] The parties may make written submissions to costs, the Applicant within 10 days of release of this endorsement and the Respondent within 10 days thereafter. If they cannot agree on the terms of the order, they may ask for an appointment.
J.A. Ramsay J.
Date: 2015-10-26