CITATION: Tessema v.Hagos, 2016 ONSC 1887
COURT FILE NO.: FS-10-69657
DATE: 20160324
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
TADESSE TESSEMA
H. Keith Juriansz, for the Applicant
Applicant
- and -
ABEBA HAGOS
Self-Represented
Respondent
HEARD: January 7, 8, 11 12,13, 14, 15, 18,19, 20, 21, 22, 27, 28, 2016
REASONS FOR JUDGMENT
Justice Thomas A. Bielby
INTRODUCTION
[1] The parties herein were married to each other on June 30, 1991. Both were born in Ethiopia but are now Canadian citizens.
[2] There are two adult children of the relationship, a daughter, Yordana Tessema, born October 14, 1992, and Obed Tessema, born September 29, 1997.
[3] By order dated September 13, 2012, the applicant father was granted final custody of Obed. By order dated April 5, 2013, a final order of access was made which left Obed’s access with his mother, the respondent, to Obed’s discretion.
[4] Thereafter in all of the court proceedings and conferences leading up to the trial there were no child custody/access issues identified as requiring further adjudication.
[5] At the opening of the trial and again in submissions the respondent sought an order that the children be required to attend counselling with her for the purposes of reconciliation. The respondent was advised by me that such an issue is not properly before the court and certainly was not identified at the trial management conference. Further, given the age of the children, I would not make such an order.
[6] One of the issues before the court was the respondent’s claim for spousal support. In that regard she intended to call as witnesses her counsellor, Ms. Sharma and her treating family physician, Dr. Mistry. She had not produced the clinical notes and records of these treating health care providers. She did produce a one page letter “report” signed by Dr. Mistry.
[7] Counsel for the applicant opposed the calling of these witnesses because of the lack of disclosure and opposed the evidentiary filing of the doctor’s letter.
[8] In regards to the counsellor, I allowed the respondent to obtain a copy of her file and ordered her to provide a copy of the file to opposing counsel and the court. After hearing argument I allowed the counsellor to testify after allowing the applicant further cross-examination of the respondent in regards to the information contained in her file.
[9] In regards to Dr. Mistry, the court was advised he was away until January 26th. On January 22nd the trial was adjourned to January 27th to allow the respondent an opportunity to obtain her file from the doctor, which she provided to counsel for the applicant.
[10] After the file was disclosed and after hearing further submissions, I did not allow the doctor to testify, nor did I allow his clinical notes and records to be filed. As well, I ruled that his one page report was inadmissible, being, at the very least, hearsay.
[11] Disclosure was an ongoing issue leading up to trial. Both parties argue that the other failed to disclose significant assets and evidence.
[12] The respondent submits that because of her health issues she cannot work and does not have an ability to earn an income. She testified that she suffers from, among other things, diabetes, high blood pressure, high cholesterol and depression. Throughout trial she wore a brace on her right wrist and hand.
[13] While the respondent represented herself at trial, she was, at various times, represented by a number of lawyers. Correspondence was exchanged in regards to disclosure.
[14] For example, by letter dated October 9, 2014, Mr. Juriansz wrote to Mr. Chang, the respondent’s lawyer at the time, seeking disclosure on a number of matters including the health of the respondent.
[15] The respondent has, since separation, been in at least one motor vehicle accident and perhaps two. There was also suggestion of a work related injury. In the letter of October 9th, among other requests, the clinical notes and records of treating physicians were requested. Dr. Mistry was and is the respondent’s family physician.
[16] By letter dated January 14, 2015, Mr. Juriansz again wrote Mr. Chang. It was noted therein that the respondent had not produced any documentation to support an inability to obtain employment and that medical documentation to support the claim has not been produced although requested.
[17] On January 14, 2015, a Trial Management Conference Brief was filed on behalf of the respondent. It was executed by both the respondent and her lawyer, Mr. Chang. At paragraph 10, the form question is posed, “Are there any expert reports that you intend to rely on at trial?” The answer provided reads, “Letter from physician Dr. Gunvantrai Mistry who opines about respondent’s ability to work. This witness will not be summoned due to cost etc., but if applicant wants to examine her he may summon her.”
[18] The Trial Management Conference was heard by Price J. on August 21, 2015. At paragraph 2(d) of his endorsement Justice Price ordered,
“Ms. Hagos shall serve her expert report of Dr. Mistry with a declaration of the expert as required by the Evidence Act and the Rules, and another other expert she intends to rely on at trial, by October 4, 2015, and shall include their reports in her Document Brief to be served and field by December 4, 2015.”
[19] It is clear from this and other evidence that over the course of this litigation the respondent’s health in regards to her ability to work was an issue. The doctor’s clinical notes and records would be relevant. Disclosure was not made until the 4th week of trial. The one page letter of Dr. Mistry, although contained in the respondent’s document book, was not presented as an expert’s report, nor did it comply with the Rules and law in regards to expert’s reports.
[20] I acknowledge however that a treating physician can testify without being qualified as an expert. However such testimony ought not to be permitted until the physician’s clinical notes and records are disclosed. The opposing side is entitled to know, in advance, the case they are to meet.
[21] Throughout the trial I recognized the difficulties of Ms. Hagos representing herself. She was granted certain liberties and latitude in presenting her case and responding to the case of the applicant. A trial must be fair and the playing field levelled.
[22] However, the trial must be fair to both sides. Given the correspondence exchanged and the position taken by the respondent at her trial management conference, I concluded that to allow her to disclose and file Dr. Mistry’s clinical notes and records at the “eleventh hour” and then call him as a witness was highly prejudicial and unfair to the applicant. The applicant was entitled to know in advance the case he had to meet and prepare accordingly.
[23] There are rules and procedures regarding the disclosure of records and the calling of witnesses. While exceptions can be made as I did in regards to the counsellor, I was not prepared to make such an exception in regards to the respondent’s medical evidence. It likely would have resulted in an adjournment for a significant period of time and would have resulted in increased and unnecessary legal fees incurred by the applicant in the face of repeated requests for disclosure, including medical documentation, and the respondent’s statement that she did not intend to call the doctor or file his records.
THE ISSUES
The Validity of the Separation Agreement
[24] In March, 2012 the parties entered into a Separation Agreement. In the agreement the property issue was resolved and the respondent released her claim to spousal support. The applicant submits the agreement is valid and the respondent is seeking to set aside the agreement arguing the lack of disclosure and an element of what I will call duress.
The Date Of Separation
[25] The parties disagree as to the date of the separation. The application sets out the date to be May 31, 2010. In her answer the respondent sets the date to be August 5, 2010. The applicant has agreed to the August 5th date as the date of separation, which was the date the application herein was issued.
[26] At some point thereafter the respondent amended her position and claimed a separation date of March 10, 2012, the date the Separation Agreement was signed. She alleges that she and the applicant, until that date, held themselves out to everyone else as husband and wife.
Equalization
[27] The respondent, assuming the Separation Agreement is set aside, seeks an equal share in all the assets owned by the applicant at the date of separation. I take this to mean she is seeking an equalization of net family properties. If the Separation Agreement is set aside the applicant acknowledges that equalization would be appropriate and lead evidence in that regard.
[28] The matrimonial home was jointly owned and has been sold. A large portion of the respondent’s share of the net proceeds of sale is held in trust, pending the outcome of this trial.
Ethiopian Property
[29] At the time of separation, the respondent was the registered owner of two Ethiopian properties. A third property is registered in the name of the respondent’s sister. The application submits the respondent was the owner of all three. The respondent submits that only one of these properties was hers.
[30] This issue and its determination will have a bearing on the issues of the Separation Agreement and its validity, equalization and spousal support.
Spousal Support
[31] The respondent seeks spousal support regardless of whether the separation agreement is set aside. The respondent also seeks continued coverage under the applicant’s employer provided benefit plan.
[32] The applicant submits that, assuming the validity of the separation agreement, the respondent should be bound by her waiver of spousal support. He submits regardless, the respondent has the ability to work and support herself.
[33] Regardless of the validity of the agreement the applicant seeks the respondent’s repayment of approximately $10,000.00, being one-half of the amount the respondent removed from the children’s Registered Education Savings Plan. He also seeks child support and a contribution to the children’s section 7 expenses related to their post-secondary education expenses.
[34] The applicant also seeks a divorce having told the court there is no chance of reconciliation. Given the history of these proceedings and the testimony of the parties, there is clearly no such chance.
Credibility
[35] Unless stated otherwise, where there is a conflict in the evidence of the parties, I prefer the testimony of the applicant over that of the respondent.
[36] The applicant’s evidence and the answers he gave when questioned were clear and concise. His answers were directed to the questions asked. He rarely hesitated when answering and there was no noted inconsistency in his evidence. He was familiar with all of the documents filed and would refer to various documents to corroborate his testimony.
[37] In contrast, during cross-examination, the respondent responded to questions by providing long explanations which often did not address the question asked. She was reminded on numerous occasions to answer the question put to her. The same question had to be put to her repeatedly in order to get an answer.
[38] I recognize that English is not the respondent’s first language however, at all time, the respondent had the benefit of an interpreter. There may have been times when the meaning of a question, when translated, was lost or altered. However, it was clear that the respondent understood the English language. She often started her answer before the translation was completed.
[39] Most of the respondent’s submissions to the court were in English.
[40] Further, after reviewing all the evidence and the submissions and the endorsements of the various motion judges, it would appear the respondent was not always willing to comply with certain orders that, it would appear, were in conflict with the respondent’s interests.
[41] In that regard I have read the endorsement of Skarica J. on February 26, 2015. A motion was brought by the applicant to enforce the order of MacKenzie J. The endorsement, on the second page, reads,
“It is obvious from the respondent’s own affidavit in paragraphs 5-14, that she has no intention of complying with paragraph 3 of Justice MacKenzie’s order…She is deliberately and flagrantly violating Justice MacKenzies’s order regarding the Ethiopian property which is an important part of the equalization piece to be worked out.”
[42] Justice Skarica ordered the respondent to comply with the order of Mackenzie J. by producing a copy of her passport. When questioned about why she did not produce her passport as ordered the respondent said she was not in court the day production was ordered. She testified that she was not going to produce it without an explanation.
[43] When asked on cross-examination if she had provided the doctor’s clinical notes in regards to her health issue the respondent testified that she produced everything that was requested, a statement she knew was incorrect in that the records had been requested but were not produced until the trial was almost over.
[44] There was a U.S. bank account at the Bank of Montreal which the documentation clearly shows was opened in the respondent’s sole name. However, on cross-examination, the respondent could not bring herself to concede this point and would only answer the question by repeatedly stating the applicant was with her every time she made any withdrawals and that he controlled all the monies.
[45] While acknowledging she collapsed the children’s RESP for her own use, the respondent had some difficulty telling the court about her actual use of the money, other than the monies covered some outstanding school debts incurred when studying to be a personal support worker.
[46] In exhibit 16, which is an affidavit of the respondent, sworn September 11, 2012, the respondent deposed that she received approximately $11,000.00 ($8,000.00 & $3,000.00) from the RESP but at trial agreed she received over $20,000.00.
[47] Further, the monies were only received the day before exhibit 16 was sworn, so the respondent had yet to use the money in the manner as stated in exhibit 16 (ex 1, vol. 2, tabs 22/23).
[48] While the RESP was clearly registered in the name of the respondent, on behalf of the children, the respondent refused to admit she had sole control arguing again the applicant had full financial control over everything, knew and consented to the withdrawal.
[49] During the trial management conference in August, 2015, the respondent agreed to sign a consent authorizing her previous counsel, Mr. Pomer, to release his file to the applicant. It is clear from the cross-examination that the respondent failed to disclose she already had the file in her possession.
[50] In an affidavit sworn by the respondent on May 6, 2013, (ex. 24) the respondent deposed at paragraph 4,
“I have no objection to the court enforcing the Separation Agreement of the parties herein as requested by the applicant.”
However she now challenges its validity and when asked about the statement testified, “that was then”.
[51] At paragraph 12 of exhibit 24 the respondent deposes,
“The first separation agreement I signed and that I am aware of is the one dated March 10, 2012, and which I agree with in the resolution of our property issues.”
[52] Both statements made under oath have now been repudiated by the respondent.
[53] At paragraph 16 of exhibit 24 the respondent deposed,
“I renovated my parent’s property in Addis Ababa. I had to take a loan and loan is still outstanding.”
[54] The style of cause of the affidavit indicates that, at the time, the respondent was representing herself. The respondent, on cross-examination, testified that the statement in paragraph 16 was untrue. She testified that she did no renovations nor did she take a loan. She also said her parents did not own property in Addis Ababa. In an effort to explain this statement she testified that she paid someone to prepare the affidavit and that she (the respondent) is not good in English. The language skills she exhibited at trial suggest otherwise. Further, I assume the respondent was the source of the facts set out in the affidavit.
Credibility and the Ethiopian Property
[55] As noted above, one of the larger issues in this trial was in regard to how many Ethiopian properties were owned by the respondent at the date of separation. There were two properties registered in the name of the respondent and one in the name of the respondent’s sister.
[56] The applicant alleges all three are owned by the respondent.
[57] In regards to the Ethiopian properties, the applicant testified that some years before separation he overheard the respondent talking over the phone about building a home in Ethiopia. He alleges she, over time, withdrew monies approximating $87,000.00, from her U.S. bank account at the Bank of Montreal, and used the monies to fund her overseas property acquisitions.
[58] The applicant submits that the source of the funds for this account was U.S. cash received from the parties’ operation of a gas station near the Toronto airport.
[59] The respondent alleges that she only owned one property and the other property, in her name at the date of separation, was really owned by her mother.
[60] This application was commenced on or about August 5, 2010 and was served shortly thereafter. Within a week of being served the respondent travelled to Ethiopia. The applicant testified that he was told she had to attend to an emergency. The respondent testified her trip was to close up an auto parts importing business that she had started, at the insistence of the applicant.
[61] Exhibit 13 is the applicant’s Ethiopian properties document brief. The property the respondent alleges was really owned by her mother is referred to as located in Sebeta Town 02 Kebele, Addis Ababa and was purchased by the respondent in 2008 (tab 2).
[62] On August 24, 2010, the respondent conveyed the property to her mother, Mrs. Goytotom Meresa Enquay for 90,000.00 Birr (tab 6). Ethiopian currency is called Birr.
[63] On the same day the respondent’s mother gave the respondent a power of attorney over the property conveyed to her. The power of attorney was specific to this property only.
[64] By Will, dated May 5, 2012, the respondent’s mother (now deceased) bequeathed the same property to the respondent (tab 10). A portion of the translation of the will reads,
“I provide to my testate, my daughter Mrs. Abeba Hagose Mekonnen to use as her personal property. Not to be requested by any family as a heir or any one who asks as the member of the family…”
[65] A plain reading of this translation is that the property was bequeathed to the respondent free of any claim by other members of the family.
[66] When questioned about her mother’s will, the respondent testified that while the property was left to her in the will, it was to be a family property and that she only had a 1/8th interest in it.
[67] The respondent testified that when the property was first acquired she made a down payment of $800.00. She testified that her sisters have since repaid the money to her. The respondent also testified that at some point she loaned her mother $5,000.00 to complete the building on this property.
[68] The respondent testified that when she travelled to Ethiopia to close the business, the applicant would not provide her any monies to facilitate the closing. Accordingly, she had to ask her mother to repay the $5,000.00 loan. The respondent testified that her mother repaid the loan and for that reason the respondent conveyed the property to her mother.
[69] Given the respondent’s credibility issues, the documents referenced and the timing of the transfer of the property to her mother, I find this explanation is not credible.
[70] This explanation is inconsistent with the deed, power of attorney and the respondent’s mother’s will. Further, the timing of all of this goes beyond a coincidence. Why would the respondent’s mother give back the power of attorney to the respondent who resided in Canada and was, for the most part, not in Ethiopia to manage the property?
[71] I find that at no time since separation has the respondent relinquished control over this property.
[72] Cross-examination revealed rents were paid on the property transferred to her mother but until that point the respondent failed to disclose the receipt of rental income.
[73] I find her explanation lacks any credibility and given the importance of this issue to the litigation, the respondent’s lack of credibility on this issue taints all of her evidence.
[74] I find that at the date of separation the respondent was the sole owner of two properties in Ethiopia. In regards to the third property in issue, registered in the name of the respondent’s sister, the evidence falls short of establishing, on a balance of probabilities that the respondent had an interest in it.
Date of Separation
[75] In my considerations of this issue I have had regard to Oswell v. Oswell (H.C.J.), 1990 CanLII 6747 (ON SC), a decision of Weiler J. In paragraphs 13 to 18 the court considers the indicia of being “separate and apart”.
[76] While there must be a physical separation, “Just because a spouse remains at the same house for reasons of economic necessity does not mean they are not living separate and apart.” (para. 13)
[77] There must be a withdrawal by one or both spouses from the matrimonial obligations with the intent of repudiating the marital relationship.
[78] The absence of sexual relations, while not conclusive, is a factor.
[79] Other considerations include the discussion of family problems and communications between spouses.
[80] The performance of household tasks is also a factor.
[81] Taking this indicia into account and having heard the evidence, I have no hesitation in finding the date of separation to be August 5, 2010, the date initially subscribed to by the respondent.
[82] The application was issued on August 5, 2010 and served on the respondent shortly thereafter. Thereafter, for a period of time the parties lived separate and apart under the same roof, being the matrimonial home, known municipally as 4 Tadington Circle, Brampton.
[83] The respondent admitted that well prior to this date the parties had stopped any physical intimacy. After separation I accept the applicant’s evidence that he cooked for himself and the children.
[84] The applicant, as the only spouse employed at the time of separation, maintained the expenses of the home. I accept his evidence that well before the date of separation he wanted the matrimonial home to be sold as he found the costs of maintaining to be excessive and beyond his needs. However, the respondent would not agree to sell the home.
[85] Accordingly, out of economic necessity, the applicant had to remain in the matrimonial home.
[86] There is evidence that after the commencement of the application the parties resided in separate bedrooms.
[87] On September 13, 2012, both parties consented to an order that the matrimonial home expenses were to be paid, pending sale, from a line of credit which was secured against the home.
[88] The applicant and the children moved out of the matrimonial home on February, 2012. The respondent remained in the home, alone, until it was sold on May 31, 2013.
[89] The respondent filed income tax returns in 2010 and 2011 and declared her marital status as, “separated” (ex. 1, vol. 2, tabs 17. 18).
[90] An early case conference was heard on June 10, 2011, and the presiding judge noted, “This is a high conflict couple”. Allegations of emotion, mental and physical abuse were made by the respondent. Significant disclosure issues were noted and an order issued requesting the involvement of the Office of the Children’s’ Lawyer. The endorsement is 6 pages in length.
[91] Given the positions taken by both parties before the case conference judge, clearly both spouses had repudiated the marriage and were living separate and apart, albeit under the same roof.
[92] It would appear that following the separation the children’s relationship with the respondent became strained and sides were taken. As noted, the children chose to move out of the matrimonial home with their father.
[93] The true intent of the applicant, at the time the application was issued, was to terminate the relationship and resolve the issues arising from the termination.
[94] This evidence only leads to the conclusion that the parties were, at the very least, separated by August 5, 2010, and remained separated thereafter.
Validity of the Separation Agreement Dated March 10, 2012
[95] Turk v. Turk, 2015 ONSC 4294, is a decision of Kiteley J., of the Ontario Superior Court of Justice. In that case, the applicant, among other things, was asking the court to set aside a separation agreement. Commencing at paragraph 52, the court deals with the law and principles to be considered in determining whether an agreement should be set aside.
[96] It was noted that Section 56(4) of the Family Law Act dictates that a separation agreement or a provision in it may be set aside if,
(a) if a party failed to disclose to the other significant assets, or significant debts or other liabilities existing when the domestic contract was made;
(b) if a party did not understand the nature or consequences of the domestic contract; or
(c) otherwise in accordance with the law of contract.
[97] At paragraph 53 of the Turk case reference is made to the Ontario Court of Appeal decision in LeVan v. LeVan, 2008 ONCA 388 which applied a two part test when considering section 56(4):
(a) the court must determine if the party seeking to set aside the agreement can demonstrate that one or more of the circumstances in subsections (a) to (c) have been engaged; and
(b) If the moving party has fulfilled the first part, the court must then consider whether it is appropriate to exercise discretion in favour of setting aside the agreement.
[98] The onus is on the party seeking to set aside the separation agreement to prove their case.
[99] At paragraph 55, of the Turk case the following is stated,
“In exercise its discretion as to whether it is appropriate to set aside the agreement, the following factors should be taken into account:
(a) whether there had been concealment of the asset or material misrepresentation;
(b) whether there had been duress, or unconscionable circumstances;
(c) whether the petitioning party neglected to pursue full legal disclosure;
(d) whether he/she moved expeditiously to have the agreement set aside;
(e) whether he/she received substantial benefits under the agreement;
(f) whether the other party had fulfilled his/her obligations under the agreement.”
[100] Justice Kiteley in Turk, at paragraph 56, discusses claim for spousal support under section 15.2 of the Divorce Act and notes the court is required to take into consideration the condition, means, needs and other circumstances of each spouse, including
(a) the length of time the spouses cohabitated;
(b) the functions performed by each spouse during cohabitation; and
(c) any order, agreement or arrangement relating to support of either spouse.
[101] As noted earlier within the Separation Agreement the respondent waived her claim to support.
[102] In challenging the Separation Agreement the respondent seems to rely on two considerations. The first is a lack of financial disclosure, particularly in regards to the applicant’s pension.
[103] The second is the undue influence of the applicant.
[104] The applicant testified that after he learned that the respondent had transferred a property out of her name and into her mother’s he believed there was a risk of future dispositions of property by the respondent. Accordingly, he retained legal counsel in Ethiopia to commence a court application in an effort to prevent further Ethiopian property dispositions, pending the conclusion of this matter. The respondent’s mother was named as a party to the Ethiopian court application.
[105] The respondent testified that her mother was not in good health and was very upset at being added as a party to the Ethiopian application. The respondent testified that her mother was to be in court in Ethiopia two days after the separation agreement was signed. The respondent testified that her mother suffered emotional and mental trauma over the possibility she had to go to court.
[106] The respondent testified that the applicant used her mother’s health, and the threat of the Ethiopian lawsuit against her.
[107] In her words, the applicant forced her (the respondent) to sign the agreement, knowing that she would do anything to protect her mother. I refer to this ground as one of duress.
[108] As noted, the Separation Agreement, a copy of which can be found at exhibit 5, tab 4, was signed by the parties herein on March 10. 2012, 19 months after separation and the commencement of this family law application.
[109] Paragraph 3 is entitled, “Acknowledgment” and reads,
“The parties hereto hereby acknowledge and agree that they wish to enter into the within Separation Agreement in order to, once and for all, and on consent, settle all corollary issues arising out of their marriage.”
[110] The agreement called for an equal division of the net proceeds of the sale of the matrimonial home.
[111] The applicant released any interest in the respondent’s property, including the Ethiopian properties, and agreed to terminate the Ethiopian court application.
[112] The respondent in return released all interest in the applicant’s assets including his pension and, as noted above, waived any claim to spousal support.
[113] The applicant, upon the execution of the agreement, contacted his Ethiopian counsel and instructed him to terminate the application.
[114] Continuing with the agreement, paragraph 5 (e) of reads,
“Tadesse states that he does not own any RRSP and property beside the matrimonial home and a sum of $800.00 in State Farm Insurance. In the event that it becomes factual or revealed that he owns any such property or RRSP, prior to signing this agreement, it is agreed that the title or deed of such property will be transferred to Abeba Hagos.”
[115] Apparently the respondent was suspicious that the applicant was not disclosing all his assets and this paragraph was inserted in answer to this suspicion. No other significant assets have been identified since the signing of the agreement.
[116] At paragraph 6 the parties agreed to a divorce.
[117] In paragraph 7 the parties acknowledge that they have had their own independent legal advice, were aware of the contents of the agreement and understood its nature and consequences, and have made full and complete disclosure. The agreement notes the parties signed voluntarily.
[118] The evidence suggests that an earlier draft agreement was prepared by a lawyer but the amended version, executed by the parties, was likely prepared by Fisseha Feleke, the husband of the respondent’s sister. Mr. Feleke was a witness to the signatures and was involved in negotiating the terms of the separation agreement.
[119] The agreement was in fact signed by all parties in the matrimonial home on March 10, 2012, at approximately 11:00 pm.
[120] As noted above in my discussions of credibility, in the respondent’s affidavit of May 6, 2013 (ex. 24), sworn more than a year after the agreement was executed, the respondent deposed,
“I have no objection to the court enforcing the separation agreement of the parties herein as requested by the applicant.”
[121] Further, as noted previously, at paragraph 12, the respondent deposes,
“The first separation agreement I signed and that I am aware of is the one dated March 10, 2012, and which I agree with in the resolution of our property issues.”
[122] It is clear that at the time the respondent signed the agreement she had retained David Pomer as her legal counsel. Mr. Pomer had been sent a copy of the agreement and advised the respondent not to sign it, a point conceded by the respondent.
[123] Located at tab 10 of exhibit 6 are a number of emails in regards to the negotiation and preparation of the Separation Agreement.
[124] On February 29, 2012, the applicant emailed Fisseha Feleke providing him with some financial information. In the last sentence the applicant wrote,
“In the future, in anyway is she finds out I had any investment or any RRSP then she could take it not half but the whole thing.”
[125] By email dated March 1, 2012, the applicant communicated with the respondent in regards to an RRSP and explains to her that if she discovers any further investments he would sign the “whole thing” over to her.
[126] By email dated March 1, 2012, the respondent requests from the applicant his income tax returns from 1991 to 2010.
[127] The aforementioned emails are a clear indication that some level of disclosure and requests for disclosure were being made by both parties. As part of the application commenced by the applicant, financial statements had been exchanged.
[128] Both parties knew of their obligations in regard to disclosure.
[129] An early case was held on June 10, 2011. A review of the endorsement of Price J., the case conference judge, reveals the applicant stated his yearly income to be $70,505.00 whereas the respondent believed it to be $83,000.00, being made up of his earnings as a technician for a communications company, a realtor, a limousine driver and from operating a credit card exchange business.
[130] The respondent’s income or lack thereof was also discussed with the respondent taking the position case that she had no income.
[131] The need for the disclosure and valuation of assets was noted. Price J. ordered extensive disclosure and the valuation of certain assets. The respondent was ordered to retain a certified property valuator to value any properties she owned in Ethiopia.
[132] Returning now to the emails, by email dated Friday March 9, 2012, Mr. Feleke messaged both parties and enclosed the draft Separation Agreement. The parties were asked to let him know if anything needed correction and to pay particular attention to paragraphs 4 and 5(b).
[133] By email dated March 10, 2012, 12:38 am the respondent emailed the applicant and Mr. Feleke as follows:
My lawyer he say no 100% or he will stop to be my lawyer plus I have a disagreement on #5 we had this case at the court #6b and part of #6ad says lump sum payment she received I did not receive any payment from tad #6e not checked yet he say on disculser dane yet. #8c #10 my lawyer refused to participated.
Tad as I say befor lets finshed abut ethiopia court isse and the support AND RRSP THAN THIS WELL BE EFFECTIVE DOUCMENT FOR THE CANADA CUORT WE WILL FILET AS PART OF AGREEMENT WITH OUR SIGNCHER AND WETNESS EVRY THING IS ON THE COURT SO DON’T MAKE IT COMPLICATED LETS FINSHED FOR THE SAKE OF THE FAMILY AND OUR SELF OK I HOPE YOU UNDERSTAND WHAT I AM TRYING TO SAY.
[134] This email suggests that the respondent was anxious to execute the separation agreement and be finished with the Ethiopian issue among others.
[135] On February 29, 2012, the applicant sent an email to Mr. Feleke, enclosing an actuarially prepared, pension valuation of his employment pension through his employer, Allstream. This email was forwarded to the respondent by Mr. Feleke shortly thereafter. The valuation can be found at exhibit 1, tab 12(K) and is dated April 1, 2011. Exhibit 18 are portions of Mr. Pomer’s file, including some additional emails.
[136] On March 7, 2012, the respondent sent Mr. Pomer the following message:
“This is an urgent matter regarding the settlement issue. attached please find the proposal drafted by my x-husband’s lawyer base in fact on family negotiations. I have questions particularity on numbers 6, 7, 8,d,ii, 10b., d and e. Also there are legal terms that I did not understand at all. Could you please quickly review the document so that we can work on it. Please give me a call or email me as soon as you receive this. I would like to come tomorrow at any time is convenient for you. Again it is time sensitive. I don’t mean to pressure you but I need your help.”
[137] By email dated March 13, 2012, although after the fact, Mr. Pomer messaged the respondent saying,
“I cannot recommend and sign a separation agreement that does not include a separation agreement. You are entitled to spousal support. Your income is extremely low. You are relatively young. Your ex makes a substantial agreement. You are leaving a substantial amount of money on the plate. I will in all livelihood be sued by another lawyer for signing over your rights.
You are entitled to spousal support. I am exposed to a lawsuit if I allow you to sign off. You are under 50 years old, and you have no real ability of getting much higher hourly rates for yourself.”
[138] It was the evidence of the applicant that in 2010 the parties had discussions about the terms of a Separation Agreement and produced a hand written agreement that the applicant delivered to his counsel.
[139] The applicant testified that early in February 2012, he contacted Mr. Feleke to proceed with reinstating settlement discussions. The applicant had a lawyer prepare a draft agreement.
[140] Within the draft the applicant waived child support. However, as referenced in one of the emails, the applicant testified that the respondent wanted this paragraph removed from the agreement stating she wanted the agreement to be silent in regards to the children. The suggestion was that when the respondent was financially able, her intent was to help support the children.
[141] A new draft was emailed to Mr. Pomer. As noted, the respondent acknowledged in her testimony that she was advised by Mr. Pomer not to sign the agreement.
[142] As noted, the agreement was executed at around 11:00 pm at the matrimonial home in which the respondent was the sole occupant. The respondent worked that day and told Mr. Feleke that he and the applicant could come to the house at 10:00 pm when she would be home from work.
[143] The applicant testified that he did not force the respondent to do anything and that he believed he had to start the Ethiopian court proceedings to prevent the respondent from disposing of her properties. He believed those properties had to be “frozen” pending the outcome of this application.
[144] Mr. Feleke testified that originally the applicant was demanding a cash payment of $40,000.00 as part of any settlement, however over time this claim was reduced and ultimately abandoned.
[145] Mr. Feleke testified that prior to the signing the parties and he went through the paragraphs of the agreement “one by one” and that the respondent was aware that she was releasing any interest in the applicant’s pension.
[146] Mr. Feleke when cross-examined by the respondent denied that anyone used her mother’s health to get the respondent to sign.
[147] The respondent testified that in the few days before the separation agreement was signed her mother called her upset concerning her required attendance in court. Her mother couldn’t understand why she had to go to court because she had repaid the $5.000.00 to the respondent. The respondent told her mother that she would talk to the applicant. When she spoke to the applicant he told her if she signed the agreement he would drop the lawsuit against her mother.
[148] The respondent testified that in fact all of her brothers and sisters were calling her in regards to their mother.
[149] The respondent testified that she only signed the agreement to save her mom so that she would not have to go to court to defend herself.
[150] The respondent testified that on March 8, 2012, she called her lawyer, Mr. Pomer and was told by him that he was about to go on vacation and would meet with her on his return. She testified that he told her signing was not good for her.
[151] She testified that her sister and Mr. Feleke told her to sign because they did not want to lose their mom.
[152] The respondent told the court that on the Friday night, March 9, 2012, she went to Mr. Feleke’s home to talk about the Separation Agreement. She was told that if she signed the action in Ethiopia would stop.
[153] The respondent testified that she invited Mr. Feleke and the respondent to come to her home the next day.
[154] The respondent acknowledged that previously she asked that the paragraphs relating to the children in any way be removed including the waiver of child support. She spoke of her concern about the children.
[155] The respondent then testified that she signed three copies of the agreement without reading the detail. This seems somewhat contradictory to her evidence that when after reviewing an earlier draft she asked that certain paragraphs be removed, particularly with respect to the waiver of child support.
[156] To this email the respondent replied, “Hello Mr David this separation agreement I ordey sing sorry but I have to sing it for my mom. Don’t get mad at me.”
[157] On March 14, 2012, the respondent messaged Mr. Pomer and wrote, “I singed that it ok forget abut support it is oared dane the only thing left is to sale the home get my portion I have to move on with my life.”
[158] Exhibit 19 is an affidavit signed by the respondent on June 26, 2014. At paragraph 12 the respondent deposed,
“I admit I should not have signed this agreement. During the weeks leading up to this agreement, my lawyer at the time David Pomer did request I not sign such an agreement, but I was not able reach him late evening March 10, 2012.”
[159] In her testimony at trial the respondent made no mention of any attempts to contact Mr. Pomer on the 10th.
[160] At paragraph 11 the respondent deposes,
“The applicant dropped by with the agreement around 11:00 pm and stated if I signed it, he would drop the lawsuit in Ethiopia against my mother. I felt I had no choice given the short time before the court would deal with my mother. She had just come out of the hospital for blood pressure issues. She eventually passed away June 9, 2012.”
Duress
[161] This consideration would fall under section 56(4)(c) of the Family Law Act which allows me to set aside a separation agreement or a provision in it, “otherwise in accordance with the law of contract”.
[162] The only element of duress or coercion relied upon by the respondent is in relation to her mother’s health the court action in Ethiopia in which her mother was a party. When testifying the respondent did not rely on any other forms of coercion or duress.
[163] There are some references to emotional and even physical abuse in the pleadings, in the early case conference endorsement and as well in the testimony of the counsellor, Ms. Sharma. However, in her testimony the respondent only spoke of her need to protect her mother.
[164] As noted in the Annual Review of Family Law, 2014, at page 1142,
“A court may rescind a contract if a party was induced to enter the contract by duress. In general contract law, duress involves a threat of wrongful and immediate force in the formation of a contract.”
[165] A court will not set aside a contract that was freely entered into simply because of grossly inadequate consideration or because it is unfair to the objecting party (Rosen v. Rosen 1994 CarswellOnt 390(C.A.); leave to appeal to S.C.C. refused) (see text p, 1148).
[166] The presence of independent legal advice usually will negate one spouse’s influence over the other and minimize the prospect of an agreement being set aside for duress, undue influence, or unconcscionability (see McGregor v. VanTilborg 2005 CarswellBC 933) (see text p. 1148).
[167] The burden is on the respondent to persuade me on a balance of probabilities that on the ground of duress the contract should be set aside. She has failed that burden.
[168] I have made findings in regards to credibility that do not favour the respondent. I have found that in fact the respondent owned at least two properties in Ethiopia when she only admitted to owning one.
[169] When the application was commenced she took immediate steps to protect at least one of these properties by conveying legal title to her mother.
[170] In the negotiation of any settlement consideration passes between the parties to the agreement. In regards to a matrimonial settlement, there is usually an emotional overlay. The applicant wished to protect his pension and limit his exposure to spousal support. The respondent, wished to protect her properties in Ethiopia, I expect for a number of reasons, including the protection of her mother.
[171] It was the respondent who arranged for the execution of the agreement. Certain changes were made at her request.
[172] The respondent had independent legal advice.
[173] The applicant did not take advantage of the situation to the point where it would amount to duress or coercion. Given the actions of the respondent, it was not unreasonable for him to initiate a proceeding in Ethiopia to prevent the respondent from disposing of assets.
[174] Further it can be said that the respondent, by transferring on of her Ethiopian properties into her mother’s name, put her mother in the position of responding to the Ethiopian court application.
[175] There is no evidence of threats made by the applicant to the respondent.
[176] I find that there was no duress upon which the Separation Agreement can be set aside.
Financial Disclosure
[177] The Separation Agreement herein was executed approximately 18 months after the application had been commenced and well after the early case conference.
[178] Lawyers were retained, financial statements were exchanged and assets were identified. Net family property statements were produced.
[179] The responded has not persuaded me that the applicant had significant assets that he failed to disclose.
[180] He identified his pension and retained an actuary to value his pension in accordance with the legislative regime in place at the time.
[181] The valuation was disclosed to the respondent.
[182] The history of this proceeding discloses that the respondent was guilty of failing to disclose. She was reluctant to disclose her passport and was obstructive in allowing the applicant’s experts from accessing her Ethiopian properties for valuation purposes.
[183] The respondent, as noted, agreed to sign an authorization directing Mr. Pomer to release his file to the applicant, without disclosing she already had the file.
[184] It seems to me that to rely on a lack of disclosure a party as to ensure that he or she have met their disclosure obligations.
[185] However, regardless of what the respondent disclosed and failed to disclose, I find that the applicant, prior to the execution of the Separation Agreement disclosed his significant assets and liabilities and the value of those assets and liabilities, as of the date of separation. Some of the numbers changed minimally but not to the extent necessary to rise to non-disclosure as contemplated by section 56(4) of the Family Law Act.
[186] At trial the applicant substantiated the values he presented with corroborative documentary evidence and this was not challenged by the respondent (ex. 1).
[187] The respondent has failed to meet the burden necessary to set aside the Separation Agreement on the grounds that there has been a concealment of assets or material misrepresentation on the part of the applicant.
Failure to Understand the Nature and Consequences of the Domestic Contract
[188] While this subsection of section 56(4) was not relied upon by the respondent, because she was unrepresented at trial I feel compelled to comment on it.
[189] It is clear from the evidence that the respondent understood the nature and consequences of the Separation Agreement.
[190] Cleary she knew that to protect her Ethiopian property she had to release her interest in the applicant’s pension and in spousal support.
[191] She asked the paragraphs referencing the children in any way be removed.
[192] In affidavits in the months following the execution of the agreement she relied on the terms of the agreement.
[193] Both the parties received benefits from the agreement. Each released the other from any claim on assets owned by the other.
[194] Both parties were noted to have an equal interest in the jointly owned matrimonial home and were entitled to receive an equal share from the net proceeds of sale.
[195] Further, the respondent received the benefit of the withdrawal of the Ethiopian application.
[196] The respondent has not demonstrated that any one of the circumstances in subsections (a) to (c) have been engaged and for that reason I need not consider the second part of the test as set out by the Court of Appeal in LeVan v. LeVan.
[197] The respondent has failed in her burden to have the Separation Agreement set aside. The agreement is declared valid and to be in full force and effect.
[198] The applicant has claimed that if I validate the agreement the respondent be ordered to repay one half of the RESP. I decline to make such order.
[199] Had the agreement been struck and the court required to equalize net family properties, I would have placed the value of the RESP on the respondent’s side of the ledger sheet.
[200] While the RESP was to benefit the children it was the asset of the respondent.
[201] The collapse of the RESP and the respondent’s use of the funds will be taken into account in regards to spousal support. Accordingly, as equalization is a non-issue, the agreement being found to be valid, I will not order the respondent to repay any monies to the applicant.
Equalization
[202] I have ruled that the Separation Agreement is in full force and effect, certainly with respect to property. Accordingly, I am not required to determine the equalization of net family properties. The respondent’s claim for equalization is dismissed.
Spousal Support
[203] In the Separation Agreement the respondent waived her claim to spousal support. However, notwithstanding my validation of the agreement, the issue of spousal support must still be determined.
[204] A court may still order spousal support in the face of an agreement releasing such a claim.
[205] The Turk decision, at paragraph 58, refers to Miglin v Miglin 2003 SCC 24, [2003] 1 S.C.R. 303 (S.C.C.) and the two stage test to determine whether a court will uphold an agreement that limits or waives a party’s support rights.
[206] At the first stage the court should look at:
(a) The circumstances in which the agreement was negotiated and executed to determine whether there is any reason to discount it, including any circumstances of oppression, pressure or other vulnerabilities. A court should not presume an imbalance of power and the degree of professional assistance received by the parties may be sufficient to overcome any systemic imbalances between the parties.
(b) The substance of the agreement to determine whether it is in substantial compliance with the objectives of the Divorce Act at the time it was entered into.
[207] At the second stage, the court must assess whether the agreement still reflects the original intentions of the parties and the extent to which it is still in compliance with the objectives of the Divorce Act.
[208] Section 15.2(6) of the Divorce Act dictates that when a court makes an order for support it should reflect the objectives of a spousal support order which:
(a) recognize any economic advantage or disadvantage to the spouses arising from the marriage or its breakdown;
(b) apportion between spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for support of any child of the marriage;
(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and
(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.
[209] As noted in the text, Annual Review of Family Law, 2014, by James G. McLeod and Alfred A. Mamo, published by Carswell, page 1172,
“A divorce court is never bound by the spousal support terms of a settlement agreement and may override the spousal support provisions of an agreement that was “unreasonable” when executed or, if initially reasonable, subsequently became “unreasonable” because of a substantial change in circumstances outside the parties’ contemplation, even if the agreement provided it cannot be varied.”
[210] I also note, from the same page,
“There is no power under the Family Law Act to override the property provisions of a valid and enforceable domestic contract.”
[211] Until the year 2000, the respondent and the applicant operated a succession of gas stations and finally a convenience store. The respondent would work as a cashier at these facilities. Such a job would likely pay an hourly wage of close to minimum wage.
[212] Thereafter the respondent was unemployed for a period of time and returned to school to receive her diploma as a parental support worker.
[213] At the time the separation agreement was signed the respondent was employed through an agency as a parental support worker. Her wage was in the range of $13.00 per hour and she worked perhaps 30 hours per week. There is certainly no evidence that she was working full time hours. She worked if work was available to her through the agency.
[214] The Ontario Ministry of Labour website sets out the current minimum wage as $11.25 per hour. Her wage as a parental support worker was only about $2.00 per hour more.
[215] Throughout the marriage the applicant worked as a technician for an employer which now operates under the name All Stream. From that employment alone he earned annually, $70,000.00 to $80,000.00. The applicant was a hard worker. He continued his full time employment while he and the respondent ran the gas stations and convenience store. He was also self-employed as a real estate agent, limousine driver and operated for a short time a credit card exchange operation.
[216] Clearly over the course of the marriage the applicant was the major earner and the respondent was financially dependent on him.
[217] Had the Separation Agreement never been signed the respondent would likely have been entitled to spousal support.
[218] When the applicant removed himself from the matrimonial home in February, 2012, the children went with him and he was the primary caregiver. The respondent has never paid any child support or contributed to the children’s section 7 expenses resulting from their enrollment in university.
[219] Yordanos has completed her four year university degree at York University, but continues to reside in the home provided by the applicant and is currently working with the intention of returning to school next year.
[220] Obed is in his first year at York University.
[221] The only RESP set up for the children was, as discussed previously, cashed in by the respondent for her own use.
[222] Accordingly, any obligation the applicant would have to pay spousal support would be tempered by his assuming the sole obligation of supporting the children, including some portion of their post-secondary school expenses.
[223] The respondent submits she is unable to work. She is a recipient of Ontario Works. She testified that she suffers from high blood pressure, diabetes, and depression. During the trial she was always wearing a wrist/hand brace on her right hand.
[224] The respondent ceased working as a parental support worker in August, 2013. She alleges she stopped working as a result of health issues.
[225] The applicant alleges the respondent is able to work and ceased her employment to allow her to travel to and from Ethiopia. He testified the respondent’s diabetes was diagnosed early in the marriage and that she also suffered from high blood pressure when pregnant.
[226] Exhibit 5, tab 6, is a copy of the respondent’s passport. She travelled to Ethiopia four times in 2014. The respondent testified that she financed these trips by using the $10,000.00 that was ordered paid out to her from the matrimonial home sale proceeds.
[227] Certainly she was healthy enough to travel extensively.
[228] Until the matrimonial home was sold in 2013 the respondent collected $950.00 in monthly rent from a basement apartment in the matrimonial home.
[229] I accept the applicant’s evidence that for a period of time after separation he was solely responsible for the household expenses. This continued until a consent order was issued that the expenses were to be paid from the parties’ line of credit.
[230] The property in Ethiopia which the respondent conveyed to her mother, was rented out for a period of time and the rent collected was 15,000 Birr per month which equates to at least $1,000.00 per month.
[231] The respondent testified that the property that has always been in her name remains unfinished. It lacks services. She denies receiving rent for it but does admits the “caretaker and his family live there. While the applicant cannot prove the respondent receives rent for this property he certainly raises a valid issue.
[232] Further, we learned through the testimony of the respondent’s counsellor, Ms. Sharma, that the respondent applied for the Ontario Disability Support Program for a long term disability pension but her application was denied. The respondent did not provide any disclosure in that regard nor did she provide a reason for the denial.
[233] Since separation the respondent was involved in perhaps two motor vehicle accidents but despite repeated requests never provided any disclosure in regards to the claims she may have made and the injuries she sustained. She did testify that she was injured, saying at one point, she hurt all over.
[234] While the respondent may no longer be able to work as a personal support worker because of certain physical limitations, given the evidence heard, I am not satisfied that the she is unable to work. I will impute a level of income to her.
[235] A minimum wage, full time job would pay to the respondent an annual income of $23,400.00. A wage of $13.25 an hour for 30 hours a week would provide an annual income of $20,670.00.
[236] I will impute to the respondent an annual income of $25,000.00. While the respondent has testified that she is not allowed to remove monies from Ethiopia, I am not persuaded that she would not benefit financially from the collection of rent monies and for that reason have increased the imputed income over the level of full time work at minimum wage.
[237] In regards to the applicant I accept that his income historically and currently is at the levels set out in his income tax returns, line 150 (ex. 1). These earnings are set out as follows:
1998 $63,444.00
1999 $63,302.00
2000 $64,800.00
2001 $65,983.00
2002 $78,694.00
2003 $72,980.00
2004 $73,514.00
2005 $87,711.00
2006 $77,586.00
2007 $69,026.00*
*In 2007 a business loss of $14,313.00 was claimed and deducted from employment income of $83252.00.
2008 $74,124.00*
*In 2009 a business loss of $19,154 was claimed and deducted from employment income of $88,918.00.
2009 $70,509.00*
*In 2009 a business loss of $16,172.oo was claimed and deducted from employment income of $84,321.00.
2010 $77,598.00*
*In 2010 a business loss of $6,654.00 was claimed and deducted from employment income of $84,252.00.
2011 $70,936.00*
*In 2011 a business loss of $1,773.00 was claimed and deducted from employment income of $72,709.00.
2012 $83,572.00*
*In 2012 a business loss of $1221.00 was claimed and deducted from employment income of $84,306.00.
2013 $72,450.22*
*In 2013 a business loss of $13,919.18 was claimed from employment income of $86,377.40.
2014 $65,835.93*
*In 2014 a business loss of $8,079.88 was claimed and deducted from employment income of $73,915.81.
[238] Exhibit 7 is the applicant’s financial statement sworn, January 11, 2016. Therein he deposed that his income for 2015 was $77,321.00.
[239] His employment income for since 2010 averages annually, $79,813.00. The losses he has suffered as a result of his businesses are as a result of him choosing to continue to operate the businesses.
[240] Returning to Miglin, the decision of the majority was written by Bastarache, Arbour JJ and at paragraph 1 state,
“This appeal concerns the proper approach to determining an application for spousal support pursuant to s. 15.2(1) of the Divorce Act, R.S.C. 1985, c. 2 (2nd Supp.) (the“1985 Act”), where the spouses have executed a final agreement that addresses all manners respecting their separation, including a release of any future claim for spousal support.”
[241] From paragraph 4, I quote,
“As we explain below, we believe that a fairly negotiated agreement that represents the intentions and expectations of the parties and that complies substantially with the objectives of the Divorce Act as a whole should receive considerable weight. In an originating application for spousal support, where the parties have executed a pre-existing agreement, the court should look first to the circumstances of negotiation and execution to determine whether the applicant has established reason to discount the agreement. The court would inquire whether one party was vulnerable and the other party took advantage of that vulnerability. The court also examines whether the substance of the agreement, at formation complied substantially with the general objectives of the Act. As we elaborate later, these general objectives include not only an equitable sharing of the consequences of the marriage breakdown under s. 15.2, but also certainty, finality and autonomy. Second, the court would ask whether, viewed from the time the application is made, the applicant has established that the agreement no longer reflects the original intention of the parties and whether the agreement is still in substantial compliance with the objectives of the Act.”
[242] In Miglin the Supreme Court of Canada backed away from the more stringent text as determined in the Pelech trilogy which defined the threshold of overriding a spousal support release in an agreement as a radical and unforeseen change (para. 28).
[243] The Court determined that section 15.2 of the Divorce Act is a different statutory context than that considered in the Pelech trilogy (para. 42).
[244] Section 15.2 dictates that in considering spousal support a court should take into account certain non-exhaustive factors and a spousal support order should advance certain objectives (para. 43).
[245] All of this should be balanced with agreements entered into freely which set out the parties’ reasonable expectations. Section 15.2 does not provide a court with an unfettered discretion of a trial judge to substitute his views of what is required over what the parties agreed to (para. 45).
[246] From paragraph 46, I quote,
“Accordingly, a court should be loathe to interfere with a pre-existing agreement unless it is convinced that the agreement does not comply substantially with the overall objectives of the Divorce Act.”
[247] From paragraph 64, I quote,
“An initial application for spousal support inconsistent with a pre-existing agreement requires an investigation into all the circumstances surrounding that agreement, first, at the time of its formation, and second, at the time of the application. In our view, this two-stage analysis provides the court with a principled way of balancing the competing objectives underlying the Divorce Act and of locating the potentially problematic aspects of spousal support arrangements in their appropriate temporal context.”
[248] I have already considered the circumstances surrounding the negotiation and signing of the separation agreement which I have ruled I will not set aside.
[249] The respondent had independent legal advice and was told she was entitled to support.
[250] However, I find that the substance of the agreement, as it relates to spousal support, was not in substantial compliance with the objectives of the Divorce Act as set out in section 15.2(6), at the time the separation agreement was executed nor currently.
[251] The marriage was a long term marriage, lasting 19 years.
[252] During the marriage the respondent’s earning capacity never reached the applicant’s level. She was dependent on him. As a result the respondent was economically disadvantaged by the marriage and its breakdown and those circumstances must be recognized.
[253] The breakdown of the marriage resulted in the parties, who during the marriage had their combined incomes to carry the family expenses in one home, now have to maintain their own households. This results in an economic disadvantage to the respondent whose income, even as imputed, is considerably less than that of the applicant.
[254] As noted, the respondent is currently receiving Ontario Works, in the amount of $574.00 per month. In her financial statement, sworn November 4, 2015, the respondent declares monthly expenses of $762.42. She is the recipient of subsidized housing which is of assistance to her in minimizing her monthly expenses. The respondent is currently living at a subsistence level.
[255] While I have imputed an income of $25,000.00 to the respondent, even at this level of income, I find that the respondent would be living at a reduced standard of living than experienced by her during the marriage and by the applicant thereafter.
[256] The respondent continues to be covered under the applicant’s benefit plan and uses the plan to pay for her medications. It is not likely the respondent, if working at a minimum wage job, would be the recipient of a health and medical benefit plan.
[257] As a result of the marriage breakdown the respondent has and is suffering economic hardship. The separation agreement does not provide any relief of such hardship.
[258] I find that the waiver of support in the separation agreement at the time of its execution did not meet the objectives of section 15.2(6) of the Divorce Act.
[259] The lack of compliance with the objectives continues.
[260] I find the respondent is entitled to make a claim for spousal support and is not bound by the waiver set out in the Separation Agreement.
[261] The applicant and respondent remained living separate and apart in the matrimonial home until February, 2013. Any entitlement to spousal support would not arise until then as the applicant was carrying the expenses on the home.
[262] Thereafter the applicant was solely responsible for those expenses for a period of time as well as the child care costs. Until the spring of 2015, both children were in school, the eldest in university.
[263] The respondent also had the benefit of the RESP which ought to have been made available to the children.
[264] Accordingly, I decline to consider the payment of any spousal support before July 1, 2015. Any spousal support payable is offset by the costs of caring for the two children and the respondent’s use of the RESP funds.
[265] However, as of July 1, 2015, there only remained one dependent child, Obed, who started York University in September, 2015.
[266] Assuming for the moment Obed is under the age of 18, the respondent, at the imputed income level would have a child support obligation of $200.00 per month.
[267] My SupportCalculator.ca computes the Spousal Support Guideline range to be between $1,062.00 to $1,416.00 per month, with a mid-point of $1,239.00 per month. I find the mid-point as the appropriate level of support.
[268] I am to have regard to these calculations in deciding the amount of spousal support.
[269] The youngest, Obed, is 18 years of age, and while still living at home has the added section 7 expense of university.
[270] Obed is enrolled in year one of a four year Honours Bachelor of Arts program. For the academic year 2015-2016, his enrollments costs, including tuition is $7,101.90 (exhibit 6, tab 13).
[271] While I do not have an exact breakdown of his other academic direct and indirect costs, I estimate they total, together with his enrollment costs, $10,000.00, for this academic year.
[272] While it is somewhat arbitrary I find the parents are responsible for $8,000.00 of that amount, with Obed responsible for the balance by way of part time income, loans, bursaries, etc.
[273] The Divorcemate calculations, as set out in Schedule A, dictate that, on the income imputed to the respondent, and the income of the applicant, and the level of support noted, the respondent is responsible for 37.7% of the Obed’s net school expenses ($8,000.00).
[274] Accordingly the respondent should be contributing $3,016.00 or $251.33 per month together with Guideline child support of $200.00 since Obed is still residing with his father.
[275] As noted, the respondent is currently unemployed and living on social assistance. She does not have the monies to pay her combined child support obligations. I will deduct these child support amounts from the spousal support the respondent is entitled to. Accordingly the applicant shall pay to the respondent, net spousal support of $787.91 per month.
[276] The applicant seeks a divorce. The respondent however relies on the applicant’s employment health plan. It may be that once divorced the respondent may no longer be eligible as a beneficiary. This fact was not established in the evidence.
[277] I expect that as a recipient of Ontario Works the respondent is eligible for some benefit coverage which would include drug coverage. The coverage may be through the provincial Trillium Program.
[278] I will sever the divorce from the corollary issues and allow the applicant to proceed before me, by affidavit, for an uncontested divorce on the grounds the parties have lived separate and apart since August 5, 2010. However, if, as a result of a divorce, the respondent no longer has health coverage, it could be argued that such a change is a material change in circumstance giving rise to a review of spousal support.
[279] To note the obvious, when the child support obligation ceases, spousal support should be paid at the mid-range rate as noted above subject to any other material change in circumstances.
ORDER
[280] It is ordered that:
The respondent’s claim to set aside the separation agreement dated March 10, 2012, is dismissed and the agreement is declared valid with respect to all property issues, including the equalization of net family properties.
The respondent’s claim for an equalization of net family properties is dismissed.
Commencing July 1, 2015, the respondent shall pay to the applicant child support for the child Obed Tessema, born September 29, 1997, the sum of $200.00 per month.
Commencing July 1, 2015, the respondent shall pay to the applicant the sum of $251.33 month being her proportionate share of Obed’s section 7 expenses.
The waiver of spousal support in the Separation Agreement is set aside and commencing July 1, 2015, the applicant shall pay to the respondent spousal support in the amount of $1239.00 per month subject to the following paragraph.
For enforcement purposes, and for long as the child Obed remains dependent and entitled to child support, commencing July 1, 2015, the applicant is to pay to the respondent the net sum of $787.00, being the difference between his spousal support obligation and the monies to be paid to him by the respondent for the support of, and the section 7 expenses of, the child Obed Tessema.
As long as the child Obed Tessema remains a dependent and entitled to child support, and as long as the respondent is entitled to receive spousal support, for enforcement purposes, no monies are payable by the respondent for the child Obed Tessema, her obligation being realized by the net payment of spousal support by the applicant.
The applicant shall maintain the respondent as a beneficiary under his health and medical insurance coverage provided by his employer. This coverage shall continue for as long as the applicant has such benefit coverage or until the respondent no longer remains eligible for coverage.
The remaining monies held in trust from the sale of the matrimonial home shall be released to the respondent, after the issue of costs has been resolved.
As the corollary issues are now determined, the applicant, at a time of his choosing, may by motion without further court cost, move before me, for a divorce, on affidavit material, on an uncontested basis.
If either party claims legal costs, said claims are to be made to me in writing, within 21 days of the release of this ruling. Either party has 10 days from the date of receipt to respond to the costs claims of the other.
Support Deduction Order to issue as per paragraph 6.
Bielby J.
Released: March 24, 2016
CITATION: Tessema v.Hagos, 2016 ONSC 1887
COURT FILE NO.: FS-10-69657
DATE: 20160324
ONTARIO
SUPERIOR COURT OF JUSTICE
B E T W E E N:
TADESSE TESSEMA
Applicant
- and -
ABEBA HAGOS
Respondent
REASONS FOR JUDGMENT
Bielby J.
Released: March 24, 2016