Court File and Parties
COURT FILE NO.: FC-14-1152 DATE: 2016-05-06 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Diana Miller, Applicant AND Robert Clarke Miller, Respondent
BEFORE: Justice A. Doyle
COUNSEL: Michèle Blais, for the Applicant Edith Holly, for the Respondent
HEARD: April 28, 2016
Endorsement
[1] This motion is brought by the applicant, Diana Miller, for the following:
i) an order dispensing with the respondent’s consent for the listing and sale of the matrimonial home (“home”) located at 7 Samuel Mann Avenue, Stittsville, Ontario pursuant to section 23 (b) of the Family Law Act, R.S.O. 1990, c. F.3;
ii) an order that the sale proceeds of the home be disbursed in accordance with paragraph 15 of the parties’ separation agreement dated December 7, 2015;
iii) an order that the respondent vacate the home and that the applicant have exclusive possession of the home pursuant to section 24(1) (b) of the Family Law Act;
iv) costs; and
v) such further relief this Court deems just.
[2] The respondent Robert Clarke Miller’s position is as follows:
i) he is prepared to consent to an order for the listing of the home and he will cooperate with the sale of the home; and
ii) he wishes to remain in the home pending sale.
[3] For reasons set out below, the Court orders the following:
i) the home will be listed for sale within 10 days of this order unless repairs and/or staging are required (on the realtor’s recommendations), in which case they are to be completed and the home listed within 30 days;
ii) the parties will fully cooperate with staging of the home and any repairs required;
iii) the parties will fully cooperate in the listing and sale of the home including but not limited to:
iv) signing the listing agreement;
v) facilitating open houses based upon the realtor’s recommendations;
vi) keeping the house clean, tidy and odor-free for viewing purposes;
vii) facilitating all showings;
viii) fixing the list price and reducing it if necessary as recommended by the realtor;
ix) staging the home if recommended by the realtor and equally sharing the cost; and
x) following any other recommendations as provided by the realtor;
xi) Mrs. Miller will have the right to inspect the home from time to time including before showings and open houses to ensure that the property is in proper condition for showing. In addition, she will advise the realtor and Mr. Miller when she requires entry to the property and she must provide at least 24 hours’ notice to Mr. Miller. Mr. Miller will fully cooperate and facilitate Mrs. Miller’s access to the house;
xii) in the event that Mr. Miller does not comply with (i), to (xi) above, the parties may return before me at a date to be set by the trial coordinator’s office to deal with any issues arising from the sale and exclusive possession of the home;
xiii) the issue of exclusive possession of the home is adjourned; and
xiv) the sale proceeds from the home will remain in the vendor real estate lawyer’s trust account pending further Order of this Court or Minutes of Settlement.
Facts
[4] The parties were married on January 16, 1996. They have two children, Tyler born February 7, 2000 and Connor born December 29, 2001. The parties separated on November 1, 2012.
[5] Since separation, the children have resided with Mrs. Miller. Mr. Miller remained in the matrimonial home.
[6] For the first two years after separation, the children would spend half the time with each parent. At this time, the father sees the children approximately three days out of 14 days.
[7] After the separation, the parties embarked in negotiations. They participated in four sessions of collaborative family law in 2013 and early 2014. Legal proceedings were commenced in May 2014. They attended a case conference, a settlement conference and two full days of mediation with Carol Bartels. The parties executed a separation agreement on December 7, 2015. Their respective lawyers executed Certificates of independent legal advice.
[8] Paragraph nine of the separation agreement indicates that Mr. Miller would pay to Mrs. Miller the sum of $233,280 within 30 days. This amount represented an equalization payment, Mrs. Miller’s interest in the matrimonial home, retroactive support and occupation rent. Upon payment of $233,280, Mrs. Miller would transfer her half interest in the matrimonial home to Mr. Miller.
[9] The separation agreement also provided that in the event that Mr. Miller did not pay $233,280 to Mrs. Miller within 30 days, the matrimonial home would immediately be listed for sale with listing agent John Spagnoli of Royal Lepage Realty. The parties would execute the listing agreement on or before January 7, 2016.
[10] Upon listing the home for sale, the parties would cooperate with the sale, facilitate open houses, keep the house tidy and clean and odor-free, facilitate showings and reduce the listing price as necessary and recommended by the realtor. They agreed to stage the home as recommended by the realtor and share the cost equally and follow any other recommendations for sale.
[11] The agreement also provides that if there are issues surrounding the sale of the home that they could return to Ms. Bartels who would have arbitral authority to determine the issues.
[12] After the agreement was signed, Mr. Miller became self-represented. On January 13, 2016, Mr. Vallance, who is counsel on record, sent a letter to Mr. Miller indicating that the home would need to be sold given his failure to make payment pursuant to the separation agreement. He attached a copy of a listing agreement with the sale price of $549,900.
[13] Since there was no cooperation from Mr. Miller, a further email was sent from Mr. Vallance’s office asking for his availability to attend arbitration with Ms. Bartels. Mr. Miller’s response at that time was that he had some fundamental issues regarding the separation agreement. He inquired as to whether Mrs. Miller was open to renegotiate an agreement.
[14] On February 11, 2016, Mr. Vallance sent a letter to Mr. Miller with a notice of arbitration advising Mr. Miller that arbitration would take place before Ms. Bartels on March 2, 2016. Mr. Miller did not agree to attend arbitration.
[15] The matrimonial home is a four-bedroom, 3500 square foot home. According to the separation agreement, it had an appraised value of $510,000.00 three years before the separation. There is no mortgage and Mrs. Miller’s half equity is approximately $255,000 to $317,500.
[16] Mr. Miller raises a number of concerns with respect to the separation agreement, including:
- Mr. Miller did not understand why he did not obtain spousal support;
- It is not clear how the parties arrived at the final figure owed to Mrs. Miller;
- Mrs. Miller’s previous years’ income was much higher than the amount. The agreement states in the preamble that she earns a base income of $136,000 whereas, in 2013, she earned over $250,000 and in 2012, she earned over $255,000;
- He questioned the monthly amount of occupation rent used;
- He questioned the value of Mr. Miller’s pension (although he concedes that his pension was not used in the calculation of the payment owed to the wife which is actually an advantage to him); and
- He had not received all requested financial disclosure.
[17] Mr. Miller has filed the following medical reports:
i) A Royal Hospital report dated December 18, 2015 from a psychiatrist calls into question whether Mr. Miller understood the consequences of signing the separation agreement. It states that
….he is being treated for mental disorder. As a mental disorder could affect one’s capacity to make decisions his capacity in negotiations would have to be assessed. It is very clear to me that Robert’s disordered thinking and nihilism is interfering with his ability to make competent decisions.
He is deeply regretful of a recent decision and in the moment was not aware of the consequences of his actions. He suffered a sever(e) panic attack and was almost sent to the emergency department by his family doctor the next day when he realized what he had done. Given he was incapable of making decisions at the time I’m expecting that his decision can be reversed.
ii) His family doctor, Dr. Jeffrey Balon, in a letter dated December 8, 2015 states:
Patient with longstanding history of anxiety and depression presented today with acute anxiety and tingling and pain into left arm…
Patient is in obvious distress. Just signed somewhat contentious separation agreement last night and did not sleep well.
[18] There is no motion to set aside the separation agreement nor has the Answer been amended to include such relief. His counsel indicated that she intends to move to set the agreement aside.
Mrs. Miller’s position
[19] Mrs. Miller states that she is entitled to her equity in the matrimonial home. She indicates that Mr. Miller is on his fifth family law lawyer and he is delaying the matter. He is living in the mortgage-free home and is not respecting the terms of the separation agreement. He now wishes to resile from the agreement and has refused to sign the listing agreement.
[20] Mr. Miller has been given ample opportunity to cooperate and an order depriving him from participating in the sale of the home is necessary.
[21] She requires an order dispensing with his consent and exclusive possession of the home so she can take control of the listing, the staging, the open houses and the viewing of the home by prospective purchasers. The children would move back into the home.
[22] She submits that it is not realistic that he will cooperate with the sale of the home. She is not confident that Mr. Miller will cooperate as he wishes to keep the home and is not interested in its sale. His affidavit reiterates his desire to keep the home and outlines his efforts to find financing for the home. He states: “first and foremost I would like the opportunity to purchase the property”.
[23] Mrs. Miller suggests that Mr. Miller can reside with his parents or alternatively, given his annual income of $68,000, he can rent accommodation.
[24] Mrs. Miller questions that Mr. Miller did not understand the agreement. In fact he told her after the agreement was signed that he was “glad that it was over”. Despite attempts made through Mr. Vallance’s office to have him cooperate, there has been delay and no movement with respect to the sale of the home.
Mr. Miller’s position
[25] Mr. Miller recently retained Ms. Holly. He has a number of issues with respect to his capacity to execute the separation agreement as set out in the medical reports. Mr. Miller states that he did not have the capacity to sign the separation agreement nor was he aware of the consequences of the separation agreement.
[26] He is unable to pay the equalization payment and purchase Mrs. Miller’s interest in the matrimonial home at this time as he does not have the available financing.
[27] Nevertheless, he is now prepared to cooperate with the listing and is prepared to sign the listing agreement. He is submitting that he would like to continue to reside in the home and ultimately he would like to keep the home.
[28] He is having a difficult time understanding how the figures were determined in the separation agreement.
[29] There is no urgency to this motion and he wishes to demonstrate that he will be cooperative in the sale.
[30] He is currently on long-term disability from Great West Life in the amount of $4,478 per month.
Law
[31] Section 2 of the Partition Act, R.S.O. 1990, c. P.4 empowers the court to order the sale of a jointly owned home, including a matrimonial home:
Who may be compelled to make partition or sale
- All joint tenants, tenants in common, and coparceners, all doweresses, and parties entitled to dower, tenants by the curtesy, mortgagees or other creditors having liens on, and all parties interested in, to or out of, any land in Ontario, may be compelled to make or suffer partition or sale of the land, or any part thereof, whether the estate is legal and equitable or equitable only.
[32] In addition, sections 23 and 24 of the Family Law Act deal specifically with the court’s powers regarding the sale, possession and exclusive possession of a matrimonial home:
Powers of court respecting alienation
- The court may, on the application of a spouse or person having an interest in property, by order,
(a) determine whether or not the property is a matrimonial home and, if so, its extent;
(b) authorize the disposition or encumbrance of the matrimonial home if the court finds that the spouse whose consent is required,
(i) cannot be found or is not available,
(ii) is not capable of giving or withholding consent, or
(iii) is unreasonably withholding consent,
subject to any conditions, including provision of other comparable accommodation or payment in place of it, that the court considers appropriate;
(c) dispense with a notice required to be given under section 22;
(d) direct the setting aside of a transaction disposing of or encumbering an interest in the matrimonial home contrary to subsection 21 (1) and the revesting of the interest or any part of it on the conditions that the court considers appropriate; and
(e) cancel a designation made under section 20 if the property is not a matrimonial home.
Order for possession of matrimonial home
- (1) Regardless of the ownership of a matrimonial home and its contents, and despite section 19 (spouse’s right of possession), the court may on application, by order,
(a) provide for the delivering up, safekeeping and preservation of the matrimonial home and its contents;
(b) direct that one spouse be given exclusive possession of the matrimonial home or part of it for the period that the court directs and release other property that is a matrimonial home from the application of this Part;
(c) direct a spouse to whom exclusive possession of the matrimonial home is given to make periodic payments to the other spouse;
(d) direct that the contents of the matrimonial home, or any part of them,
(i) remain in the home for the use of the spouse given possession, or
(ii) be removed from the home for the use of a spouse or child;
(e) order a spouse to pay for all or part of the repair and maintenance of the matrimonial home and of other liabilities arising in respect of it, or to make periodic payments to the other spouse for those purposes;
(f) authorize the disposition or encumbrance of a spouse’s interest in the matrimonial home, subject to the other spouse’s right of exclusive possession as ordered; and
(g) where a false statement is made under subsection 21 (3), direct,
(i) the person who made the false statement, or
(ii) a person who knew at the time he or she acquired an interest in the property that the statement was false and afterwards conveyed the interest,
to substitute other real property for the matrimonial home, or direct the person to set aside money or security to stand in place of it, subject to any conditions that the court considers appropriate.
Order for exclusive possession: criteria
(3) In determining whether to make an order for exclusive possession, the court shall consider,
(a) the best interests of the children affected;
(b) any existing orders under Part I (Family Property) and any existing support orders or other enforceable support obligations;
(c) the financial position of both spouses;
(d) any written agreement between the parties;
(e) the availability of other suitable and affordable accommodation; and
(f) any violence committed by a spouse against the other spouse or the children.
Best interests of child
(4) In determining the best interests of a child, the court shall consider,
(a) the possible disruptive effects on the child of a move to other accommodation; and
(b) the child’s views and preferences, if they can reasonably be ascertained.
[33] Counsel for the mother referred to Kokaliaris v. Palantzas, 2016 ONSC 198, as an example of a case in which the court relied on ss. 23 and 24 to dispense with the father’s consent for the sale of the home and to grant exclusive possession to the mother. In that case, the mother brought a motion for an order dispensing with the father’s consent for the sale of a home. The father would not agree to any offer to purchase because he wanted to purchase it himself. He offered to buy out the mother’s share of the home but the amount he offered was not acceptable to the mother.
[34] Justice Charney found that the father had failed to comply with an earlier court order by Justice Kaufman by refusing to cooperate with the sale of the home. Relying on the Family Law Act, section 23, he made an order by dispensing with the father’s consent. He also gave the mother exclusive possession and noted that the father could live with his parents who were a short distance away. The court permitted him 30 days to allow for the transition and the opportunity for the father to move.
[35] In the context of this case, in which the parties have a signed separation agreement dealing with the sale of the matrimonial home (leaving aside the father’s submissions about his capacity to enter such an agreement for the moment), it is important to note that negotiated agreements should be given considerable deference: see Rolland v. Tevendale, 2015 ONSC 3226, and Rosen v. Rosen (1994), 18 O.R. (3d) 641 (C.A.). In Rolland v. Tevendale, Justice P. Smith emphasized the importance of respecting agreements made by the public and confirmed that the onus is on the applicant to establish why a separation agreement should be set aside.
Analysis
Order Dispensing with Consent to Sale
[36] Mrs. Miller’s motion is seeking relief under the Family Law Act. The Family Law Act provides the Court certain powers when dealing with the matrimonial home, including the power to authorize selling the home without the consent of one of the spouses.
[37] The court can dispense with Mr. Miller’s consent if he cannot be found or is not available, is not able to consent or is unreasonably withholding his consent. Mrs. Miller is submitting that he is unreasonably withholding his consent.
[38] Unlike the Kokaliaris v. Palantzas case, Mr. Miller has not been found to be failing to comply with a court order respecting the sale of the house. Indeed, there was no court order requiring Mr. Miller to co-operate with the sale. Rather, Mr. Miller was obliged to move towards selling the home pursuant to an agreement that he now wishes to set aside. Although Mr. Miller has not moved formally to request the relief of setting aside the agreement, the validity of the agreement is being attacked on the basis of his capacity.
[39] Despite this potential challenge to the agreement, Mr. Miller now consents to the sale and his only concern is being able to stay in the home pending the sale. Mrs. Miller is suspect that he will not co-operate and fully engage in the process of the sale.
[40] There is no evidence at this stage as to whether that is indeed going to be the case.
[41] Mr. Miller attributes his lack of cooperation after the signing of the agreement to his concerns regarding how the equalization amount was arrived at. His medical reports certainly set out some concerns regarding his capacity to understand the process. Mr. Miller’s medical reports call into question his capacity to negotiate and sign a final separation agreement. Certainly there is evidence to suggest he may not have appreciated the agreement.
[42] There is no motion before me to set aside the agreement, but Mr. Miller indicates that he will be moving to amend his Answer to include such relief. The validity of the agreement is a live issue that will not be determined by this Court.
[43] On the evidence before me, I am not satisfied that once the home is listed, Mr. Miller will not cooperate. At least at this point, I decline to make an order pursuant to s. 23 of the Family Law Act dispensing with Mr. Miller’s consent for the listing and sale of the home.
Exclusive Possession
[44] The Court will not order Mr. Miller to move out of the home at this time. The Court declines to grant Mrs. Miller’s request for exclusive possession.
[45] In considering the request for exclusive possession, the court takes into account the following factors listed in s. 24(3) of the Family Law Act:
- the best interests of the children (s. 24(3)(a)) : it is not necessarily in the children’s best interests to have them move twice. The children are settled in their own home with the mother and it would be disruptive to the whole family for the children to be returned back into the matrimonial home only to have to move again when the home has been sold.
- financial position of the parties (s. 24(3)(c)): the husband is living is a mortgage-free home with a substantial amount of equity in the home. Mrs. Miller is entitled to her equity in the home.
- any written agreement between the parties (s. 24(3)(d)): exclusive possession of the home was not dealt with in the parties’ agreement; the parties had anticipated that Mr. Miller would keep the home if he could buy her out of her interest and pay the equalization payment.
- Given Mr. Miller’s mental health issues, there is question as to whether he understood and appreciated the terms of the agreement. However, as mentioned, the Court is not addressing this issue on this motion.
- the availability of other suitable and affordable accommodation (s. 24(3)(e)): there is no evidence from Mr. Miller as to what alternative accommodation is available to him although Mrs. Miller has suggested his parents. The children with their mother have a home and the family’s interest would be served if there is full co-operation in the sale of the home with strict timelines.
Partition Act Sale
[46] Nevertheless it has been over three and half years since the separation and Mr. Miller is residing in a mortgage-free matrimonial home. There is a substantial amount of equity remaining in the home and Mrs. Miller should have access to the same.
[47] Under the Partition Act, the court can order a partition and sale of a jointly held property. Mr. Miller has consented to the sale and is prepared to allow the real estate agent to list the home.
[48] The Court will set out timelines for the sale of the home as well as deal with the staging and preparation of the home for the sale.
[49] The home will be listed for sale within 10 days of this order unless repairs and/or staging are required (on the realtor’s recommendations), in which case they are to be completed and the home listed within 30 days;
[50] The Court further orders: The parties will fully cooperate in the listing and sale of the matrimonial home including but not limited to:
(a) signing the listing agreement;
(b) facilitating open houses based upon the realtor’s recommendations;
(c) keeping the house clean, tidy and odor-free for viewing purposes;
(d) facilitating all showings;
(e) fixing the list price and reducing it if necessary as recommended by the realtor;
(f) staging the home if recommended by the realtor and sharing any cost of same equally;
(g) any other recommendations for sale as provided by the realtor.
[51] Mrs. Miller will have the right to inspect the home from time to time including before showings and open houses to ensure that the property is in proper condition for showing. In addition, she will advise the realtor and Mr. Miller when she requires entry to the property and she must provide at least 24 hours’ notice to Mr. Miller. Mr. Miller will fully cooperate and facilitate Mrs. Miller’s access to the house; and
[52] In the event that Mr. Miller does not comply with paragraph 49 to 51 above, the parties may return before me at a date to be set by the trial coordinator’s office to deal with any issues arising from the sale and exclusive possession of the home;
[53] The sale proceeds from the home will remain in the vendor real estate lawyer’s trust account pending further Order of this Court or Minutes of Settlement.
[54] There will be no order as to exclusive possession. That issue is adjourned. This issue can be brought back before me in the event that Mr. Miller fails to comply with the terms of this order.
[55] Costs of this motion are reserved to the trial Judge.