Afshar v. Mahmoodi, 2016 ONSC 2875
CITATION: Afshar v. Mahmoodi, 2016 ONSC 2875
COURT FILE NO.: FS-15-405592
DATE: 20160428
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Mosen Afshar, Applicant
AND:
Mahnaz Mahmoodi, Respondent
BEFORE: Kiteley J.
COUNSEL: Paul Slan, for the Applicant
Naser Abedi, for the Respondent
HEARD: April 14, 2016
ENDORSEMENT
[1] This is a motion by the Applicant for spousal support, release of funds held in trust from the sale of the matrimonial home and costs; as well as a cross-motion for disclosure.
[2] The Applicant and Respondent married on December 24, 1996 in Iran having signed a marriage contract that obligated the Applicant to make certain payments.
[3] The parties have two girls born April 4, 1998 and January 23, 2001. The family emigrated to Canada in 2004 at which point the Applicant was a physiotherapist and the Respondent was a gynecologist. Between 2004 and 2015, both parties engaged in professional education although they disagree about many of the details. At the time of the separation on March 15, 2015, the Applicant was practicing as a physiotherapist and the Respondent was practicing as a physician. The parents separated on March 15, 2015 but continued to live under the same roof (along with the parents of the Respondent).
[4] The jointly owned matrimonial home was sold with a closing on November 30, 2015. After discharge of the mortgage there is almost $480,000 held in trust. Since the closing, the children have lived with the Applicant.
[5] The Application was issued on September 29, 2015 and the parties attended a case conference on December 22, 2015 at which time Justice Paisley made an endorsement “cc held. See attached checklist”. In that checklist there is in bold letters the following: “Motions to be heard on the following issues before next conference if necessary” and he has checked off “disclosure and child/spousal support”. Justice Paisley also directed the parties to provide complete disclosure and he noted that questioning was permitted.
[6] The Applicant’s motion was originally returnable February 11, 2016. The Respondent’s responding affidavit had been served on January 7 and the motion was adjourned to February 11 at which time the parties signed a consent to an order requiring the Respondent to pay temporary table child support in the amount of $3672 per month based on income of $295,647. The parties agreed that the Respondent would pay 65% of the private school tuition, school fees and additional expenses for 2015-2016 and 2016-2017. The parties also agreed to split other s.7 expenses 65:35 and agreed that the Respondent could amend her Answer.
Preliminary Issue
[7] Counsel for the Respondent made a preliminary objection that the court ought not to hear the motion to release funds on the basis that Paisley J. did not authorize it in his case conference endorsement. Mr. Slan took the position that it was not necessary that it be specifically permitted but that motions of any sort were permitted after a case conference. Mr. Slan noted that on February 11 when the motion was adjourned, counsel had not raised that objection.
[8] Rule 14(4) provides that motions may not be heard before a case conference is heard dealing with the substantive issues in the case. Counsel agree that at the case conference held on December 22, 2015, there was a discussion about the substantive issues in the case including spousal support and release of funds. The fact that Paisley J. checked a box indicating the motion for support might be brought before the next conference but did not check off the box indicating “other” is not a barrier to bringing the motion to release funds. In paragraph 68 of her affidavit sworn February 7, the Respondent purported to opine on the legal issue of the meaning of such an endorsement which I disregard.
Issues in the proceeding:
[9] In the Application, the Applicant has made claims for spousal support and equalization of net family property.
[10] In the Amended Answer filed March 8, 2016, the Respondent has opposed the claims made and has made various claims including a claim to enforce the marriage contract as well as for a “freezing of assets”.
Evidence on the motion
[11] There is extensive evidence including affidavits of the Applicant, the Respondent, the parents of the Respondent, and a foreign legal consultant. The evidence demonstrates considerable conflict as to whether the Applicant was the primary caregiver for the children at any time since the move to Canada and conflict as to who owns what property in Iran and the value of that property. The contents of the affidavits of the parents are unusually stilted and do not appear to have been translated from which I infer that they may not have fully understood the contents of the affidavits that they signed. On this record, in the context of a motion for temporary spousal support, I cannot resolve those many evidentiary conflicts.
Spousal Support
[12] The burden is on the Applicant to establish entitlement to temporary spousal support. I agree with Mr. Slan that for the period 2004 to 2011, the Applicant was the primary financial provider. They disagree about what jobs the Applicant held and whether he or the Respondent’s parents (who came for extended periods of time and stayed in the home) looked after the children and the household. They disagree whether the Applicant has made a contribution to the career of the Respondent which is now reflected in the fact that the income of the Respondent is twice that of the Applicant. Furthermore, the Respondent takes the position that before they came to Canada the Applicant made decisions that had a negative financial impact on her. I will not be resolving those many conflicts in this motion.
[13] The undisputed fact is that until the Respondent qualified in 2011, she was not contributing financially to the household in any significant way. The evidence is that for purposes of s. 7 expenses in the temporary order, her income is established to be $295,647 and his income is $134,755 or a ratio of 65:35. For purposes of this motion for temporary spousal support, based on the financial responsibility he assumed during the marriage and her enhanced earning power, I am satisfied that he has met the burden of establishing that he is entitled to temporary spousal support.
[14] The question is how much. Mr. Slan has provided SSAG calculations that reflect a midpoint on the range of $1255 per month and he asks that the order be made retroactive to November 1, 2015. In the notice of motion, there was no claim for retroactive spousal support and accordingly, the earliest date such a claim can be made is December 15, 2015 which is the date that the notice of motion was served.
[15] While taking the position that the Applicant is not entitled to spousal support, counsel for the Respondent asserts that even if found to be entitled, the Respondent ought not to be required to pay temporary spousal support on account of her obligations pursuant to the temporary order made on February 11 which requires her to pay almost $40,000 per year in table amount of child support plus significant s. 7 expenses mostly for tuition; her obligation to support her parents who she sponsored for immigration purposes; and her obligation to support her adult children from her previous marriage.
[16] I do not accept that the financial contributions she is making to support her adult children are relevant. I am not satisfied that she has a legal obligation to support them and on the evidence before me, I find that she is fulfilling a moral obligation that ought not to be a consideration.
[17] I do accept that the Respondent’s obligation to support her parents is relevant to the amount of spousal support she should be ordered to pay. As the undisputed evidence indicates, the parents have visited here for extended periods of time during which time, without weighing whether the parents or the Applicant did more of caregiving and household management than the parents, the fact is that the family benefitted from their prolonged visits and sponsorship was a reasonable step. The Respondent has a legal obligation to the government of Canada to care for them.
[18] In the SSAG calculation provided on behalf of the Applicant, the input data includes the required information including that the length of marriage/cohabitation was 18 years. That would suggest that for a lengthy period, the parties experienced a differential in earnings which I equate to the current 65:35 ratio for s. 7 expenses. That is not accurate. Without making findings as to the disagreements between them on the facts, it is clear that in Iran they were both professionals; they emigrated to Canada when the children were about 6 and less than 3; they both had to qualify here and it took the Respondent much longer than the Applicant; even assuming that the Applicant was contributing more financially between 2004 and 2011, they managed to acquire a family home with equity of almost $500,000. The SSAG’s are the starting point for the analysis but not necessarily the end point. Theirs is a unique situation that the SSAG’s were not meant to capture. I am not persuaded to adopt and rely on that calculation in this case.
[19] The evidence of the Applicant is that he is under financial stress because of significant debts which he has documented. The Respondent challenges the source of and the responsibility for such debts but they clearly exist. As indicated below, I will release the funds from the sale of the matrimonial home which will enable the Applicant to pay his debts as he intends to do and eliminate the financial stress.
[20] It may be that at trial the Respondent is ordered to pay spousal support but I will not make the order at this time.
Proceeds of sale of matrimonial home
[21] The proceeds of sale of the former matrimonial home are almost $480,000 which have been held in trust. The Applicant asks that the proceeds be divided equally and released to each of them.
[22] The Respondent’s evidence on the point is as follows:
The parties entered into a marriage contract on December 24, 1996. The marriage contract is in writing, witnessed, signed and dated. The marriage contract met the conditions of a domestic contract under the Family Law Act. . . Under the marriage contract, the Applicant has undertaken two conditions regarding the Mehrieh and the specific percentage of his funds for commencing a divorce proceeding on me.
The first obligation related to the marriage contract is that the Applicant has undertaken to pay me Mehrieh, in the amount of 1000 Bahar Azadi gold coins, the equivalent of approximately $380,000 Canadian Dollars. Each Bahar Azadi gold coin is valued at approximately $380.00 Canadian Dollars. It is my understanding that the Applicant’s debt for the Mehrieh cannot be calculated as his debt on the Net Family Property. . .
The second obligation is related to the Applicant who will transfer to me free of consideration half of the assets acquired by him during matrimonial life. . .
According to the marriage contract both parties declare that “We the couple did sign this certificate and the conditions provided with full knowledge and at free will”. The Applicant was fully aware of his obligation when he executed the marriage contract. He signed it at free will. Throughout the marriage he relied on the marriage contract and as a part of his supporting document he presented the marriage contract to various agencies including the Canadian government for his immigration purposes.
The terms of the marriage contract were simple. Both parties have university education and understood the terms of the Marriage Contract. Other than the payment of the Mehrieh amount of 1000 Bahar Azadi gold coins which is approximately $380,000.00 Canadian Dollars, the Applicant undertook additional obligation to transfer to me free of consideration half of the assets acquired by him during matrimonial life. My Mehrieh payment is due on my demand. The second part of the Applicant’s obligation which is he transfer to me free of consideration half of the assets acquired by him during matrimonial life is payable as the Applicant filed his Application for divorce on September 29, 2015.
The Applicant owes me Mehrieh and half of the assets acquired by him during matrimonial life. The Applicant advised me and I believe that it is true that he has already made it very clear that he has no intention of paying his debt pursuant to the marriage contract and I accordingly feel I would be at a disadvantage were the money to be released prior to a resolution of this dispute. I consider the proceeds of the sale of the Matrimonial Home to be a security for the equalization payment the Applicant will owe to me and for his payment owed to me pursuant to the marriage contract.
I was advised by my lawyer and I believe it is true that the value of the Mehrieh and half of the value of my husband’s assets is considered excluded from net family property and my spouse cannot deduct them from his net family property. Naser Abedi advised me that Family Law Act and case law support this view under Section 4(2)6 of the Family Law Act, which provides: “Property that the spouses have agreed by a domestic contract is not to be included in the spouse’s net family property”.
[23] The Respondent has provided what purports to be a legal opinion from a foreign legal consultant as to the validity of the marriage contract.
[24] In response, the Applicant deposed as follows:
On December 24, 1996 (the date of marriage), the Respondent and I signed an Islamic marriage contract. No financial disclosure was made. Neither party had a lawyer. The contract was not prepared and signed in accordance with the law of Ontario.
The contract prohibits the Respondent from requesting a divorce unless certain conditions are met. These conditions have not been met.
In any event, Iranian law now restricts payment to a maximum of 110 gold coins.
[25] The Respondent has not brought a motion to “freeze” the proceeds of sale but for purposes of dealing with the issue I will assume she has done so. I dismiss her motion to “freeze” the proceeds for the following reasons.
[26] In his factum, counsel for the Respondent relies on the decision in Khanis v Noormohamed [2009] 27829. That was a decision after a trial with evidence and legal submissions and, based on the excerpt from the marriage contract, the terms of that contract were much different than the terms of this contract. I do not consider that that decision applies to this motion.
[27] The evidence offered by the Respondent includes an affidavit from a foreign legal consultant. I reject that evidence for these reasons. First, assuming such evidence is admissible on a motion such as this, it was not served 90 days before the hearing of the motion. It would be unfair to allow the Respondent to rely on it. Second, the affidavit contains largely generic evidence about marriage contracts. The deponent does not attest to the circumstances in this case.
[28] I disregard the conclusions that both parties reach in their affidavits in which they purport to draw conclusions of law or conclusions of fact and law relevant to the validity and enforceability of the contract. It is inappropriate for parties to provide such evidence.
[29] Had she brought a motion to “freeze” the proceeds of sale, it would have been pursuant to s. 12 which applies in an application for an equalization of net family property. It does not apply to protecting a party against a claim asserted under a marriage contract.
[30] I turn now to whether the Respondent is entitled to an order pursuant to s. 12 on account of her claim for an equalization of net family property. The evidence from both parties about their respective net family property values and the components of those values is in conflict. The assertion that the Applicant owes her an equalization payment is based on many assumptions none of which have been established. Disclosure by both parties has just started. On this evidence I am not persuaded that it is “necessary for the protection of” the Respondent’s interests under Part 1 of the Family Law Act that I make such an order.
[31] Title to the home was held jointly and accordingly, prima face, the Applicant is entitled to the order he seeks. As indicated above, he is under considerable financial stress and ought to be able to access his half of the proceeds of sale.
Disclosure
[32] On February 18, 2016, counsel for the Respondent served a Form 20 Request for Information. He did not respond within 20 days. On April 6, 2016 counsel for the Respondent served a motion returnable April 14 in which he asked for an order that the Applicant respond. Mr. Slan advised that on April 13 he had delivered a significant amount of disclosure.
[33] On March 30, 2016, counsel for the Applicant served a Form 20 Request for Information within 30 days. The 30 days had not expired at the hearing of the motion.
[34] It was premature to be dealing with these disclosure issues at this time. I make no order on the record before me.
[35] During submissions, there seemed to be a disagreement between counsel as to the period of time for which disclosure was required. I will make an order on that issue that impacts both parties.
Costs
[36] At the conclusion, I asked for counsel’s costs outline and offers to settle. Counsel for the Respondent provided his which were placed in a sealed envelope. Later that day, Mr. Slan provided his costs outline after advising counsel for the Respondent that he had delivered it to my attention.
[37] After deciding the outcome of the motions, I looked at the documents counsel had provided. In his offer dated April 12, 2016, the Applicant proposed that the Respondent pay temporary spousal support in the amount of $1255 per month commencing November 1, 2015 and he proposed that the sum of $122,481.53 be released to him. In her offer dated April 12, the Respondent proposed that he withdraw his motion for support and payment of the proceeds.
[38] Pursuant to rule 24(1) the successful part is presumed entitled to costs. The Applicant was not successful in obtaining an order for temporary spousal support but he was successful in obtaining an order for payment of the proceeds of sale. The Respondent was successful on the first and not successful on the second. The Applicant’s offer was better on the proceeds of sale than was the order I made. The Respondent’s offer on spousal support was consistent with my order dismissing the motion but the Applicant was successful in my finding that he was entitled to temporary spousal support.
[39] On balance, and in relation to the offers, the Applicant was more successful than was the Respondent.
[40] I accept Mr. Slan’s bill of costs effective from February 11, 2016 particularly in comparison with the bill of costs presented on behalf of the Respondent which is much higher. I reduce the amount payable modestly to reflect that the Applicant was not fully successful.
ORDER TO GO AS FOLLOWS:
[41] The motion by the Applicant for temporary spousal support is dismissed.
[42] The motion by the Applicant for an order releasing the proceeds of sale of the former matrimonial home is allowed. The real estate lawyer shall forthwith equally divide the funds held in trust arising from the sale of the matrimonial home and pay 50% to each party or to the person to whom the party directs in writing.
[43] The Respondent shall pay costs of the motion fixed in the amount of $5000 plus HST provided that the real estate lawyer shall pay that amount to the Applicant from the 50% share of the proceeds of sale payable to the Respondent.
[44] The real estate lawyer is authorized to act on this endorsement without waiting for the signed and entered order.
[45] Both parties shall provide disclosure from a point that is no later than March 15, 2014.
Kiteley J.
Date: April 28, 2016