Court File and Parties

COURT FILE NO.: FS-11-367261 DATE: 20160829 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Segal Adler, Applicant AND: Kerry Adler, Respondent

BEFORE: Kiteley J.

COUNSEL: D. Wowk and S. Yuen, for the Applicant M. McCarthy and S. Young, for the Respondent

HEARD: August 23, 2016

Endorsement

Background

[1] The parties have four children: ages 19, 17, 14 and 12. The parents separated in 2010.

[2] On October 16, 2014 in a consent endorsement, Conway J. ordered the Respondent to pay $50,000 per month in undifferentiated support and continue to pay all s.7 expenses. Perkins J. repeated those orders in a consent endorsement dated March 13, 2015.

[3] In an endorsement dated December 11, 2015 [1], I dismissed the Respondent’s motion to adjourn the trial scheduled for the week of January 18, 2016.

[4] In an endorsement dated January 15, 2016 [2], I granted the Respondent’s second request for an adjournment of the trial and then tentatively scheduled it for the week of November 7, 2016.

[5] One of the issues arising from the two requests to adjourn the trial was the compliance by the Respondent with the order that he pay 100% of the s. 7 expenses. In January, 2016, the evidence indicated that Josh had been told by his school that he could not go to school as tuition had not been paid. In that endorsement I wrote as follows:

31. Pursuant to a consent order the Respondent is required to pay 100% of the s. 7 expenses for all four of the children. He has failed to do so as evidenced by his unreasonable and irresponsible failure in the first week of January to pay Josh’s tuition. Counsel for the Applicant asks for an order requiring the Respondent to post security for those s. 7 payments so that it is no longer a source of conflict. I agree with such a condition. I do not have details as to the amounts of payments required with respect to each of the children. As indicated below, I will require payment in a specified amount unless the parties agree otherwise.

[6] At paragraph 41(e) of that endorsement, I ordered that, by February 15, 2016, the Respondent do the following:

Pay an advance on his obligation to pay 100% of the s. 7 expenses to cover all expenditures between now and the conclusion of the trial in an amount agreed to and failing agreement $100,000.

[7] The Respondent did not attempt to reach an agreement and instead, he paid $100,000. In her letter dated January 28, 2016, Ms. McCarthy wrote as follows:

Justice Kiteley’s endorsement of January 14, 2016 provides that the Respondent is to pay an advance on his obligation to pay 100% of the s. 7 expenses for all the children in an amount that will cover all of such expenditures between now and the conclusion of trial in an amount agreed to; and failing agreement, in the amount of $100,000. Mr. Adler is prepared to agree to advance $100,000 and his cheque is enclosed. Please have Ms. Adler provide an accounting of how these funds are allocated.

We are also attaching invoices from Crescent and Branksome. Please confirm that Ms. Adler will pay these expense from the $100,000.

[8] The invoice from Crescent School set total tuition for the 2016/2017 year at $31,750 with installments due as follows: by February 8, 2016 $4,500; by June 1, 2016 $17,500; by December 1, 2016 $10,750. The invoice from Branksome set total tuition for the 2016/2017 year at $30,010 and required installments of $5,000 by March 1 and $25,010 by April 1, 2016.

[9] In December, 2015, the Respondent had received an invoice requiring a payment for Hailey’s tuition for the winter/spring semester at university in the U.S. in the amount of $24,472.56USD which payment was required to be paid by January 29. At the time of making the advance payment of $100,000, he did not disclose that he had received that invoice. In a letter dated February 3, 2016, Ms. McCarthy forwarded the invoice and confirmed her expectation that the Applicant would be responsible for paying that amount as well. In other words, at the time of the advance of $100,000, there were already obligations to pay $31,750, $30,010, $24,472.56USD. By acting unilaterally rather than attempting to agree which I had directed, the Respondent created a situation where approximately 90% of the advance would appear to have already been spent, leaving approximately $10,000 of the advance for the remainder of all of the s. 7 expenses for 10 – 11 months.

[10] In view of the adjournment of the trial, the Applicant then brought a motion originally returnable February 4, 2016 for a preservation order and other relief including an order with respect to the s. 7 expenses. In an endorsement dated April 12, 2016 [3], I dealt with most aspects of the motion brought by the Applicant and, as indicated in paragraph 60 of that endorsement, on consent, I adjourned the motion with respect to s. 7 expenses to the combined settlement conference and trial management conference scheduled for April 15, 2016.

[11] The parties were unable to come to a resolution at the combined settlement and trial management conference and I provided dates when I would be available to hear submissions while urging the parties to resolve the issues without a motion.

[12] In the original notice of motion, the Applicant asked for the following:

An order varying the Order of Justice Kiteley dated January 15, 2016 to provide that the Respondent shall continue to pay for all the children’s section 7 expenses in accordance with the order of Justice Conway dated October 16, 2014 and the order of Justice Perkins dated March 13, 2015.

In the alternative to paragraph 9, an order requiring the Respondent to provide a further advance for the children’s section 7 expenses.

Costs of this motion on a full recovery basis.

[13] The evidence in support of that motion was the Applicant’s affidavits sworn January 28, 2016 and March 29, 2016.

[14] The Applicant’s motion was adjourned to June 30, 2016. Her counsel served a notice of return of motion in which the relief sought was as follows:

An order that the Respondent pay $11,650.27 to the Applicant by way of reimbursement for s. 7 expense paid by her for the children since January 15, 2016 that are in excess of the $100,000 advance from the Respondent.

An order that the Respondent pay $211,620.09 to the Applicant by way of a further advance on his obligation to pay 100% of the s. 7 expenses for all of the children to cover all such expenditures between now and the end of December 2016 as intended by the January 15, 2016 order of Kiteley J. or, if required, varying the January 15, 2016 order accordingly. In the alternative, requiring that the Respondent directly pay 100% of all the children’s s. 7 expenses in accordance with the orders of Justice Conway dated October 16, 2014 and the order of Justice Perkins dated March 13, 2015 conditional on him paying the expenses within 10 days of them being incurred.

An order that the Respondent shall forthwith make arrangements with Great West Life Assurance Co. and any replacement insurance provider, for the Applicant to make claims for reimbursement of qualifying expenses directly and to directly receive reimbursement. The Respondent shall provide the Applicant with a copy of all correspondence exchanged with Great West Life Assurance Co. for this purposes.

Costs of this motion on a full recovery basis.

[15] When that notice of return of motion was served, it was accompanied by the Applicant’s supplementary affidavit sworn June 16, 2016.

[16] On June 23, 2016, counsel for the Respondent advised that they expected to complete his responding affidavit by June 28, two days before the motion.

[17] At the request of counsel I held a case conference by telephone on June 28 to address the scheduling issues with respect to the Applicant’s motion and the Respondent’s motion to vary paragraph 59 of the April endorsement. The Respondent had not yet served his material in response to the s.7 motion. I was not available at the date proposed so I adjourned the s. 7 motion to August 23 before me. The Applicant had also brought a motion to strike the Answer as a result of, inter alia, his failure to comply with paragraphs 58 and 59 of the April endorsement and the Respondent had brought a cross-motion to vary paragraph 59 of the endorsement. In an endorsement dated July 7, 2016 I adjourned both to September 6.

[18] In a letter dated July 6, 2016, Ms. Wowk asked that the responding material be served immediately. She continued to ask for the material and advised counsel for Mr. Adler that the Applicant would be away between July 26 and August 17 and wanted to have an opportunity to review the responding material in time for the August 23 motion.

[19] In the absence of responding material, the Applicant delivered an affidavit dated July 25, 2016.

[20] The Respondent had brought a motion before the Divisional Court for leave to appeal parts of the April 15 order and for a stay pending the hearing of the appeal. In connection with his stay motion, his counsel served his 17 page affidavit sworn July 15, 2016 and his 10 page reply affidavit sworn August 5, 2016.

[21] On August 17, 2016, the Respondent signed his responding affidavit in the s. 7 motion and on Thursday August 18 the affidavit was served in which, for the first time since the s.7 motion was launched, he indicated he had or would pay the tuition for the following:

Jake at Crescent School $23,284.58CAD Lexi at Branksome $25,960.48CAD Hailey fall term $31,114.20CAD ($23,934USD) Total $80,359.24

[22] He insists that the invoice for Hailey which he received in December 2015 and which was due on January 27 for $24,472.56USD was a s. 7 expense that he was not required to pay because the due date was after the January 15 order and that it was properly to be paid by the Applicant. He pointed out that if she had paid in a timely manner using the $100,000 he had given her, she would have paid only $33,883CAD not $35,086.61CAD.

[23] The Applicant having returned from her holiday on August 17, signed a reply affidavit on Friday August 19 and it was served that day. On Monday August 22, at about 5:00 p.m., counsel for the Applicant served an amended notice of return of motion in which she sought the following:

Abridging the time for service of this further amended notice of return of motion on grounds of urgency

A temporary, without prejudice, order granting the Applicant sole custody of Joshua for the purpose of making treatment decisions for the child.

In the alternative, an order that the Respondent shall execute any consent or authorizations required by and for Dr. Pat Phelan to conduct a review and report with respect to treatment recommendations for Joshua within 7 days. The parties shall forthwith implement the recommendations for treatment for Josh by Dr. Pat Phelan and the Respondent shall execute whatever consent or authorizations may be required by the treatment providers within 7 days of the consent or authorization being provided to him.

The Respondent shall be responsible for the costs of the services of Dr. Pat Phelan and for any treatment programs recommended by her, which costs shall be paid within 7 days of him receiving the invoices.

In the alternative, the Respondent shall advance $100,000 to the Applicant to be used for payment of assessment and treatment expenses for Josh, including reasonable travel and other related expenses for Josh and the Applicant.

An order that the Respondent pay $13,587.17 to the Applicant by way of reimbursement for s. 7 expense paid by her for the children since January 15, 2016 including expenses for Hailey’s university that were incurred prior to January 15, 2016.

An order that the Respondent pay $20,000 to the Applicant by way of a further advance on his obligation to pay 100% of the s. 7 expense for all of the children to cover all such expenditures between now and the end of December 2016, as intended by the January 15, 2016 order of Kiteley J. or, if required, varying the January 15, 2016 order accordingly. In the alternative, requiring that the Respondent directly pay 100% of all the children’s s. 7 expenses in accordance with the order of Justice Conway dated October 16, 2014 and the order of Justice Perkins dated March 13, 2015, conditional on him paying the expenses within 10 days of them being incurred.

An order that the Respondent shall forthwith make arrangements with Great West Life Assurance Co., and any replacement insurance provider, for the Applicant to make claims for reimbursement of qualifying expenses directly and to directly receive reimbursement. The Respondent shall provide the Applicant with a copy of all correspondence exchanged with Great West Life Assurance Co. for this purpose.

Costs of this motion on a full recovery basis.

S. 7 Expenses

[24] At the outset Ms. Wowk indicated that with the exception of the early 2016 university payment, in view of the Respondent’s payments on August 17 and 18 of three key tuition payments for Hailey, Lexi and Jake, the balance of the motion should be adjourned to trial. Ms. Wowk took the position that the early 2016 payment for Hailey had been incurred before my order and the Respondent should be required to reimburse her client.

[25] The December 2015 invoice for Hailey’s tuition due at the end of January 2016 preceded my January 15 endorsement in which I provided for an advance (in an amount agreed upon or $100,000) for “expenditures between now and the conclusion of the trial”. I agree with Ms. Wowk that that invoice remained the Respondent’s obligation to pay pursuant to the two prior consent orders. I agree with Ms. McCarthy that he should not be required to pay the higher amount given that the Applicant could have paid as required by the invoice.

[26] Ms. Wowk also asked for clarification about paragraph 41(e) of the January order. Ms. McCarthy conceded that the payment that I had ordered of (a negotiated amount or) $100,000 was not a ceiling but was, as described, in the endorsement, an advance.

[27] She did however take the position that before an order is made for any additional payment prior to trial, counsel for the Applicant had to establish a material change in circumstances. She initially opposed Ms. Wowk’s submission that the balance of the motion be adjourned to trial. She later acquiesced in the adjournment but took the position that the adjournment was in effect an implicit withdrawal for which the Applicant should pay serious cost consequences.

[28] In view of the agreement that the balance of the s. 7 motion would be adjourned, counsel then made submissions as to the mechanics of the adjournment including what claims were outstanding and whether the s. 7 motion would be heard at the outset of the trial or during the course of the trial. In addition, the issue of costs of the motion before me had to be addressed.

[29] By that point, the 60 minutes allocated for the motion had been exceeded and I indicated that those details would be left to the scheduled TMC/SC on September 9 although I expected that the parties would sort that out in advance. I indicated that I would give directions on the issue of costs of the motions.

[30] I observe that there are differences between the parties as to the definition of “special and extraordinary expenses”. Rather than exchange hundreds of pages of documents which the trial judge will not address, I strongly encourage counsel to agree on the categories of differences and focus on those.

Medical Insurance

[31] According to the Respondent, his employer changed insurers from Sun Life to Great West Life “in or about 2012”. According to the Applicant, she was aware that the insurer had changed but repeated emails from her to him and from her lawyer to his lawyers did not provide the information she needed to submit claims to him and she said that the first notice she had as to the scope of the new coverage was when she received the benefit booklet attached to his August 17 affidavit. As the evidence discloses the transition from one insurer to another has led to enormous conflict.

[32] The Respondent’s affidavit indicates that he recently notified Great West Life that he wanted the Applicant to submit claims directly and receive payment directly. Ms. Wowk asked that she be kept informed as to the response and Ms. McCarthy agreed. It is unfortunate that something so straitforward as medical expense reimbursement has become yet another battleground and I am optimistic that the lawyers will solve this issues immediately.

Issues Regarding Josh

[33] Ms. McCarthy was, to put it mildly, indignant that a motion of such significance had been served after 5:00 p.m. the evening before the hearing of the motion. She insisted that it be adjourned to give her client an opportunity to respond.

[34] As indicated in the December 2015 and January 2016 endorsements, in the context of the adjournment of the trial, I expressed grave concerns about the need for the parents to collectively agree on how to respond to the needs of then 16 year old Josh. The evidence from the mother was that Josh was in a crisis because his father had not paid tuition and he was not permitted to attend school. The evidence from the father was that Josh’s situation was under control.

[35] In her affidavits, the mother had given considerable detail about what was going on and in his affidavit sworn August 17, the father replied extensively. He was well aware of the issues with which Josh was confronted including where he would go to school in September 2016. For that reason, I doubted whether the father really needed an opportunity to respond to the August 19 affidavit. I understand why the Applicant would have brought the late amending notice of motion with respect to Josh. However, I do agree that the order sought by the mother would change the parenting dynamic and for that reason, an adjournment of that aspect of the motion was required.

[36] As indicated above, I have set aside time on Tuesday September 6 to hear the Applicant’s other pending motion, namely to strike the Respondent’s Answer. Ms. Wowk confirmed that it would proceed. Since counsel will be attending before me on that date, I indicated that I intended to adjourn the Applicant’s motion with respect to Josh subject to my giving further consideration to making any of the orders sought before then.

[37] The circumstances with respect to Josh and the uncertainty of whether there should be another assessment and if so by whom and at what cost, whether he should resume in therapy and if so with whom, and where he will go to school in the immediate future and if so, where and at whose expense are a direct result of the adjournment of the trial that was caused by the Respondent combined with the lack of collaboration by the parents to achieve a plan.

[38] I will not summarize the evidence as to what has happened over the last few months except to say that the mother has repeatedly reached out to the father to try to collaborate on making a plan and the father has ignored her until another crisis occurred in early August at which time he flew immediately to Toronto and having had dinner with Josh, the Respondent decided what plan should be put in place. As the Applicant said, by the time she returned to Toronto on August 17, that plan had unravelled.

[39] At paragraph 82 of his affidavit sworn August 17, 20016, the Respondent set out how he intends to approach the situation including “work with Josh”. He goes on to say that Josh “would like to make this decision with his parents”. If the Respondent works with Josh and leaves the Applicant out of the process which is what he has done so far this year, then the objective Josh wants to achieve will elude him and he will continue in the chaos he has been experiencing for too many months.

[40] On August 23 I asked both counsel if the parties had had direct face to face communication on issues with respect to Josh since the endorsement dated January 15. The affidavits by both parents made reference to electronic communications only. The Applicant was present in court and she confirmed that the last time the parents had had face to face communication on the subject of Josh was on April 15, 2016 when were was a discussion at the TMC/SC as to how to proceed.

[41] Josh needs parents who can effectively communicate and collaborate with appropriate professionals and with him to make and implement a plan that will respond to his special needs. If the parents are unable to do it together, then I must consider authorizing the Applicant, who is living with Josh and is in Toronto far more than the Respondent is to make the decisions. However, I will not take that step without giving the Respondent an opportunity to respond to the amended notice of motion.

[42] I have given serious consideration to making an order that the Applicant be permitted to have the review and report done by Dr. Pat Phelan and to dispense with the Respondent’s consent so that she might do so immediately. I have decided not to take that step yet primarily for logistical reasons, namely Dr. Phelan is located in the U.S. and I am not confident on this record that Josh will cooperate and go to see her. I would not want an order authorizing the retainer of Dr. Phelan when it appears that would require Josh to cross the border, particularly because of the issues of which both parents are aware and which ought not to be mentioned in this public document.

[43] I have therefore concluded that all aspects of the amending notice of motion must be adjourned to September 6. I strongly urge the parties and counsel to resolve these issues and point out that I will not entertain a discussion on this subject at the TMC/SC on September 9 which will be the first opportunity for the parties to meaningfully explore the financial issues in the case.

Costs of the Motion

[44] I will ask first for submissions as to entitlement to costs. Only after I make that decision will I decide whether to require counsel to make submissions as to amount of costs.

[45] I make this observation relevant to the issue of entitlement. The motion with respect to s. 7 expenses has been outstanding since early February. The Respondent’s affidavit was sworn August 17 and was served Thursday August 18 with the Applicant having returned to Toronto on August 17 and counsel having no opportunity to discuss the significant step that the Respondent had made to pay the three education invoices. It was his priority to focus his energy on the motion for leave to appeal and the motion to stay paragraph 59 of the April endorsement and to cause extensive affidavits on the stay motion to be served rather than respecting her agenda and responding as well to her motion. An earlier response such as what was received on Thursday August 18 for a motion returnable August 23 would likely have led to a resolution other than the attendance before me last week.

Order

[46] By September 9, 2016 at noon, the Respondent shall pay to the Applicant the sum of $33,883CAD as reimbursement for Hailey’s university tuition for the winter of 2016.

[47] The Applicant’s claim for retroactive and current s. 7 expenses is adjourned to the trial including those claimed in the motion before me, provided that in her TMC/SC brief for September 9, 2016, counsel for the Applicant will particularize the s. 7 expenses referred to in this motion that will be claimed at the trial.

[48] Paragraphs 2 – 5 of the amended notice of return of motion are adjourned to Tuesday September 6 at 10:00 a.m. before me. The Respondent shall serve and file responding affidavit by Friday September 2, 2016 at noon EDST.

[49] By September 22, 2016, counsel for the Applicant shall make written submissions not exceeding 3 pages as to entitlement to costs of the s.7 motion. By September 30, 2016, counsel for the Respondent shall make written submissions not exceeding 3 pages as to entitlement to costs. Neither party shall make written submissions as to the amount of costs until directed to do so.

Kiteley J. Date: August 29, 2016

Cited Cases:

[1] Adler v. Adler, 2015 ONSC 7806 [2] Adler v. Adler, 2016 ONSC 386 [3] Adler v. Adler, 2016 ONSC 2414