Court File and Parties
Oshawa Court File No.: FC-14-044961-00 Date: 2016-10-05 Ontario Superior Court of Justice – Family Court
Between: Yakov Eitan Berman, Applicant And: Alissia Berman, Respondent
Counsel: P. Viater, for the Applicant D. Z. Frodis and K. Levitt, for the Respondent
Heard: May 16, 17, 18, 19, 20, 24, 25, 26, 27, 30, 31, 2016 Written Submissions Received: June 16, 2016
Decision
L. E. FRYER, J
I. Introduction
1The Applicant, Yakov Eitan Berman (“Jacob”) and the Respondent, Alissia Berman (“Alissia”) are the parents of the child, Eliana Eti Berman, born February 2, 2013.
2Jacob and Alissia have different personalities, and they come from different cultural and religious backgrounds. These differences led to conflict throughout their relatively short relationship.
3Jacob and Alissia separated on December 20, 2013 following an argument in the car en route to visit Alissia’s family in Amherstburg, Ontario for the holidays. Alissia told Jacob that she would not return to the Greater Toronto Area where the parties had been living but was going to stay with Eliana in Amherstburg. Jacob, whose family and friends are in the GTA, was strongly opposed; he believed that Alissia was trying to take Eliana away from him. Both parties immediately retained lawyers. Although the parties’ lawyers were in communication, Jacob opted to bring an ex parte motion. He obtained an order requiring Alissia to return Eliana to York Region immediately. Alissia was so shocked that she collapsed.
4As in so many separations, these early steps exacerbated the conflict and lack of trust that already existed between the parties and set the tone for over two years of litigation leading up to a trial that spanned almost three weeks.
5Alissia sought sole custody of Eliana as she and Jacob are unable to reach agreements on even the most basic issues without protracted negotiations. Jacob initially took the position that the parties’ had a good track record of cooperation and communication that supported a joint custodial order. However, mid-way through the trial Jacob changed his mind and advised that he was now seeking sole custody.
6The parties did agree that Eliana should spend significant parenting time with Jacob including mid-week overnight access. Jacob wanted equal parenting time whereas Alissia wanted Eliana to remain in her primary care. Each party clearly viewed the other as at least an acceptable caregiver for Eliana. Despite this, Jacob and Alissia both spent considerable trial time dwelling on the other’s negative characteristics.
7The suspicion and lack of trust between the parties also wove its way through the financial issues. There were longstanding issues regarding financial disclosure that continued into the trial.
8Jacob was employed in used car sales for many years prior to the marriage. Shortly after the marriage, Jacob lost his job at the Buy Right dealership where, according to Jacob he had been an owner, partner or investor. Despite his skill as a car salesman, Jacob opted to start up a kitchen renovation business during the marriage called Made2Fit. Alissia had serious reservations about Jacob’s new business particularly as they had just purchased a large new home and she was pregnant with Eliana. Made2Fit failed within the year. Alissia and Jacob were forced to borrow money from friends and family to make ends meet.
9After the parties separated, Jacob delayed returning to work, as he insisted on first negotiating his parenting time with Eliana. When he did ultimately return to work, he was tardy in providing details to Alissia even in the face of a court order. Alissia arranged for her fiancee’s friend to pose as a customer to try to prove that Jacob was working and to catch him accepting cash. Alissia also declined to work initially as she was hoping at that time to move with Eliana to Amherstburg.
10Alissia sought to impute an income to Jacob of at least $100,000 for the purposes of child support retroactive to the date of separation.
11With respect to the division of net family property, Jacob advanced a number of claims related to large sums of undocumented cash. Jacob said that he had over $50,000 in cash in his residence on the date of marriage for which he sought a deduction from net family property. Jacob initially alleged that he was paid $46,000 for a business investment that he owned on the date of marriage; however, during the trial he modified his position claiming that he was actually paid a further $114,000 in cash for a total date of marriage deduction of $160,000. Lastly he asserted that two of his friends loaned him in excess of $62,000 all in cash during the marriage. Jacob did not proffer any explanation as to why these large sums of cash were changing hands.
12Alissia owed Jacob an equalization payment the amount of which was disputed. She advanced a claim for an unequal division of net family property alleging that Jacob recklessly and/or intentionally depleted his net family property through his decision to start Made2Fit and his unilateral decision to borrow large sums of money from his friends after the business failed among other grounds.
II. Background
13Jacob is 41 years old, and Alissia is 36 years old.
14Jacob and Alissia met just after Alissia moved to Toronto from Montreal; they began dating in December 2008.
15Alissia is trained as a dental hygienist and she was working full time in her field at that time.
16Jacob worked selling used cars for many years. When the parties met, he was working for Emil Mikhailov’s used car dealership, Buy Right. In or around August 2009, Jacob sold his town house and paid Emil Mikhailov $80,000. According to Jacob this was for an interest or investment in Buy Right.
17Jacob moved into Alissia’s apartment on Avenue Road in Toronto in September 2009. They were engaged some months later.
18The parties’ relationship even prior to marriage was rocky. They separated at one point, and Alissia returned her engagement ring to Jacob. Ultimately, they reconciled and were married on July 31, 2011.
19Jacob is Jewish although he is not devout. He speaks Hebrew. He and his family celebrate the major Jewish holidays. Alissia was raised in the Catholic faith. The parties knew that they wanted children and Alissia suggested that she convert to Judaism. Jacob and Alissia were married in the Jewish faith. Alissia’s family had difficulty understanding her choice to do so and this contributed to the conflict between the parties.
20In or around March 2012, Jacob left Buy Right on poor terms with Emil Mikailov.
21In May 2012, Jacob was arrested and criminally charged as a result of a road rage incident wherein Jacob drove at a high rate of speed down Avenue Road in Toronto with a man clinging to the roof of his car. Jacob retained a lawyer who assisted him in pleading down to a Highway Traffic Act offence.
22Shortly after the marriage, the parties purchased a large new home in Maple from a builder. The house purchase closed in December 2012. The home did not have finished floors or a kitchen when the parties moved in.
23Eliana was born on February 7, 2013, and Alissia started a one-year maternity leave.
24After his departure from Buy Right, rather than returning to car sales, Jacob opted to start the Made2Fit custom kitchen business with his father. Jacob arranged for Made2Fit to rent premises and to purchase the equipment needed for the business. Made2Fit built the kitchen in the matrimonial home and did some work for Sasha Davids who was a friend of Jacob’s. There is no evidence that Made2Fit had any other jobs. Jacob wound up Made2Fit less than one year later.
25The parties’ marriage continued to be strained and rocky. On December 20, 2013, the parties had an argument while driving to spend Christmas with Alissia’s parents in Amherstburg. Jacob left Alissia and Eliana in Amherstburg and returned to the matrimonial home in the parties’ van. On December 25, 2013, Alissia advised Jacob that the marriage was over and that she would not be returning home with Eliana.
26Although their lawyers were in communication, on January 10, 2014, Jacob brought an ex parte motion and obtained an order requiring Alissia to return to Maple with Eliana. Alissia was shocked by the order; however, she complied with it. Lengthy negotiations ensued as to who would reside in the matrimonial home during this interim period and when Jacob would spend parenting time with Eliana.
27In the weeks that followed, Alissia unsuccessfully attempted to have the ex parte order reviewed. Instead, a Case Conference was held on January 31, 2014 at which Jacob and Alissia decided to retain Howard Hurwitz to conduct a custody and access assessment pursuant to s. 30 of the Children’s Law Reform Act, R.S.O. 1990, c. C.12 (“CLRA”). Alissia was, at this time, seeking to move to Amherstburg with Eliana, and Jacob was seeking a shared parenting arrangement with both parties continuing to reside in or around Maple.
28The parties had sold the matrimonial home prior to the separation, and the closing took place in February 2014. After the closing, Alissia moved in with a friend who lives in North York and Jacob moved in with his sister, Yonet Blanch, and her family who live in Maple.
29Jacob did not return to work following the separation. In March 2014, Jacob declined an employment offer from a former employer, Leon’s Fine Cars, because he first needed assurances on the parenting plan. Alissia was also not working, as she still hoped to live in Amherstburg, and she did not want to start employment in the Maple area.
30Howard Hurwitz held a disclosure meeting on June 24, 2014. Neither party accepted his recommendations, and neither party ordered his report. He was not called as a witness.
31Shortly after the disclosure meeting, Alissia abandoned her claim to live in Amherstburg with Eliana.
32On July 23, 2014, Alissia brought a motion to determine parenting time for Eliana. Rogers J. ordered that Eliana would reside primarily with Alissia and have parenting time with Jacob every Monday and Wednesday from 4 p.m. to 7 p.m. and every second weekend from Friday at 4 p.m. to Sunday at 5 p.m. This schedule has remained in place up to the time of trial.
33In or around August 2014, Jacob started working part time. He started his own business with his friend, Alon Birshtein, called LeaseEnders but for various reasons did not pursue this business. Some time around October 2014, he started working for Toronto Auto Brokers as a contractor through LeaseEnders.
34Alissia started work full time in October 2014 for Expressions Dental in Richmond Hill.
35In October 2015, just before this matter was schedule to go to trial in November, Jacob brought a motion for an updated custody and access assessment. Charney J. dismissed Jacob’s motion with costs and the trial was adjourned.
36Alissia is now engaged to Steve Palialunga who lives in Richmond Hill. She and Eliana moved in with Mr. Palialunga in May 2016. Steve Palialunga has a daughter who is close in age to Eliana and who spends alternate weekends with him.
37Immediately prior to the trial, Jacob rented a condominium for himself and Eliana in Richmond Hill adjacent to Alissia’s place of work.
III. Credibility
38Credibility played an important role in the determination of the issues in this trial.
39Jacob spoke passionately about his daughter, his love for her and his desire to be the best parent he could. This message came through clearly in rich detail.
40However, in a number of respects Jacob’s credibility was called into question:
- Jacob often spoke in sweeping statements and absolutes.
- Jacob stated that he “followed every court order to a t”. When cross-examined on this issue, he acknowledged that he did not always abide by court orders particularly when he did not agree with them.
- Jacob stated that he “would never lie to a bank” and yet he submitted a Small Business Proposal for a loan that he acknowledged contained many significant inaccuracies. He also deposited in excess of $50,000 into the bank and told the bank it was wedding gifts, he then asked the court to accept that it was, in fact, cash that he had saved prior to marriage.
- Jacob stated that “he never had a problem with police in his life” whereas the evidence showed that he had a number of negative interactions with the police such as a conviction for importing marijuana and a conviction in relation to the serious road rage incident on Avenue Road.
41Jacob sloughed off the importance of being accurate on his sworn Financial Statements as, according to him, custody and access were the reason “we were at trial”. Jacob’s estimates with respect to his income varied depending upon the audience: CRA, his prospective landlord, this court.
42Alissia was also clearly devoted to Eliana and focussed on her needs. Alissia gave her evidence, particularly with respect to the parenting issues in a straightforward and careful manner. She was prepared to acknowledge previous errors in judgment. For example, she had taken issue with Jacob picking up Eliana early from daycare, and she later acknowledged that the daycare records did not support her position.
43I found Alissia to be somewhat less forthright with respect to the financial issues. On a number of occasions she said that she could not remember or had no knowledge of financial issues that were not favourable to her position. I contrast this to her excellent recall regarding parenting issues.
44On whole, with some exceptions, where the evidence of the parties conflicted, I preferred that of Alissia.
IV. Analysis
1. Parenting
(a) Custody
45Jacob initially sought joint custody of Eliana. His position was that despite a certain degree of conflict, the parties were able to agree on the major issues regarding Eliana. However, in his closing submissions, Jacob indicated that he had changed his mind and he was now seeking an order for sole custody.
46Alissia’s position was that an order for sole custody should be made in her favour, as she has always been Eliana’s primary caregiver and she and Jacob cannot agree on even the most simple and basic issues for the child except after protracted negotiations aided by lawyers. Alissia also stressed that Jacob has a volatile temper and that he will chose to harass her rather than prioritizing Eliana’s best interests.
47Under the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.) (“DA”):
- (1) A court of competent jurisdiction may, on application by either or both spouses or by any other person, make an order respecting the custody of or the access to, or the custody of and access to, any or all children of the marriage.
48Sections 16(8) - (10) of the DA stipulate:
(8)In making an order under this section, the court shall take into consideration only the best interests of the child of the marriage as determined by reference to the condition, means, needs and other circumstances of the child.
(9) In making an order under this section, the court shall not take into consideration the past conduct of any person unless the conduct is relevant to the ability of that person to act as a parent of a child.
(10) In making an order under this section, the court shall give effect to the principle that a child of the marriage should have as much contact with each spouse as is consistent with the best interests of the child and, for that purpose, shall take into consideration the willingness of the person for whom custody is sought to facilitate such contact.
49Section 24 of the CLRA also details the factors that a court shall consider when making a determination with respect to custody and access. The CLRA factors may act as a useful guide for a best interests analysis under the DA: Faber v. Gallicano, 2012 ONSC 764, 213 A.C.W.S. (3d) 378, at para. 185 and Marrello v. Marrello, 2016 ONSC 835, 263 A.C.W.S. (3d) 968, at para. 110.
50Section 24 of the CLRA is set out below:
(2) The court shall consider all the child’s needs and circumstances, including,
(a) the love, affection and emotional ties between the child and,
(i) each person entitled to or claiming custody of or access to the child,
(ii) other members of the child’s family who reside with the child, and
(iii) persons involved in the child’s care and upbringing;
(b) the child’s views and preferences, if they can reasonably be ascertained;
(c) the length of time the child has lived in a stable home environment;
(d) the ability and willingness of each person applying for custody of the child to provide the child with guidance and education, the necessaries of life and any special needs of the child;
(e) the plan proposed by each person applying for custody of or access to the child for the child’s care and upbringing;
(f) the permanence and stability of the family unit with which it is proposed that the child will live;
(g) the ability of each person applying for custody of or access to the child to act as a parent; and
(h) the relationship by blood or through an adoption order between the child and each person who is a party to the application.
(3) A person’s past conduct shall be considered only,
(a) in accordance with subsection (4); or
(b) if the court is satisfied that the conduct is otherwise relevant to the person’s ability to act as a parent.
51Alissia and Jacob both presented as loving and devoted parents of Eliana. The evidence demonstrated that they both possess many of the qualities necessary to care for their young daughter. Each party submitted a proposed parenting plan and the proposals support the fact that each party believes that the other is essentially a capable parent of Eliana.
52Jacob acknowledged early in his evidence that Alissia was a great parent. His message in his closing submissions was disturbingly different. Jacob repeatedly called Alissia a liar and his submissions in this respect were not helpful. In my view, Jacob’s initial comments regarding Alissia are a more accurate reflection of his true feelings.
53Alissia had some difficulty articulating Jacob’s positive qualities and this was somewhat of a concern. However, again, Alissia’s proposal in terms of parenting time suggests that she acknowledges the importance of Eliana having a meaningful relationship with Jacob.
54Alissia has been largely responsible for spearheading decisions for Eliana. For example, Alissia was responsible for making inquiries regarding Eliana’s eye condition and arranging for the necessary specialist appointment. Alissia initiated the search for Eliana’s daycare and later, her school.
55Alissia has been diligent about keeping Jacob in the loop as to issues or concerns about Eliana. Jacob suggested that this was only because she was under the microscope during the custody and access assessment and during the litigation generally. However, I found Alissia’s communication in this vein to be consistent in a way that could not solely be attributed to posturing for the assessor or the court.
56There were a number of examples wherein Alissia would present her research or proposals to Jacob; Jacob’s response would be to initiate negotiations with Alissia sometimes on unrelated issues. For example, following the conclusion of the custody and access assessment in June 2014, Alissia decided to remain residing in York Region. She needed to return to work as soon as possible and after some research she proposed to enrol Eliana in Central Montessori daycare. Jacob questioned Alissia’s choice without presenting alternatives, and the daycare issue was only resolved immediately prior to a motion brought by Alissia a month later. A similar dance ensued over the choice of the MiniSkool daycare for Eliana with a decision only being reached some months after Alissia’s initial proposal. Jacob emphasized in support of his claim for joint custody that ultimately the parties resolved the issues but this was only after lengthy negotiations through counsel.
57There were several other examples of issues regarding Eliana that were resolved only after long and tortuous negotiations often undertaken at the last minute. These examples included the parenting plan arrangements upon Alissia’s return to the matrimonial home per the order of Justice McGee in February 2014 and the access pick-up and drop-off location after the sale of the matrimonial home. With respect to the latter example, Alissia was required by Justice McGee’s original order to reside in York Region. After the sale of the matrimonial home closed, neither party had an income, and Alissia, who had very limited options for accommodation, chose to move in with a friend in the Yonge & Sheppard area – roughly 2 km outside of the border of York Region. Although Jacob had been aware of her plans for some time, the day before her move, Jacob threatened to bring a contempt motion apparently as leverage in the negotiations.
58Jacob appeared defensive and at times insecure about his parenting abilities and this detracted from positive co-parenting with Alissia. For example, Jacob insisted on videotaping not only the access exchanges but also his visits with Eliana despite recommendations from Howard Hurwitz and from Rogers J., at the motion in July 2014, that he stop this practice. Jacob indicated that the videotaping was his way of creating memories and that it was something that he did before separation but he also admitted that he videotaped to protect himself from “further false allegations”. It was not clear what these “false allegations” were. The videotaping created unnecessary tension and conflict at the access exchanges.
59Alissia believes that Jacob wants to monitor and control her. Jacob did seem to have a need to remain connected to Alissia beyond what was necessary to co-parent Eliana. During the assessment process in 2014, it was suggested that the parties communicate once per week on Sundays barring an urgent issue regarding the child as Alissia found the volume of communication from Jacob stressful. Jacob did not think that this restriction was necessary and was critical of Alissia for wanting to so limit communication. He continued to e-mail Alissia on off days regarding non-urgent issues such as setting up an RESP account for Eliana and purchasing winter clothes for Eliana in September. Furthermore, despite these long standing allegations, Jacob opted to rent a condominium overlooking Alissia’s place of work although other condominiums were available in the same neighbourhood. These actions would seem to support Alissia’s assertions and suggest that Jacob’s motivation may not be restricted to what is in Eliana’s best interests.
60Alissia and Jacob are both strong willed. Alissia has her own ideas about parenting and in some respects, has been inflexible. Some of her intransigence may come from a desire to ward off further negotiations with Jacob. Jacob appears to be more flexible and has been willing to consider changes to the schedule for Alissia’s benefit. However, the conflict between the parties is such that they and Eliana require certainty and predictability at this time.
61Jacob has a very supportive family network. Jacob’s sister, Yonet Blanch, and her husband, Mark Blanch, both impressed me as warm and loving people who regard Eliana as an important part of their family. Eliana has a close relationship with her cousins, the Blanch children, particularly Cassie who is close in age.
62Alissia also has a supportive family network including her parents, her sister as well as her cousin, Lisa Capaldi. Alissia is newly engaged, and it appears as though Eliana has adapted well to her new living arrangements in the home of Steve Palialunga.
63Alissia raised issues regarding Jacob’s use of marijuana and possibly other drugs. However, in her draft order, she does not seek any provisions that would address this issue, and she acknowledged that she was not relying upon his use of marijuana to suggest that he was an unfit parent. Jacob acknowledged that in the past, he has used marijuana, but he now largely abstains. I accept his evidence, and I do not view this as a significant issue affecting his ability to parent.
64Alissia has committed to raise Eliana in the Jewish faith, although she herself is no longer practicing. Jacob acknowledged that he is not devout, although his family celebrates some of the Jewish holidays.
65In Kaplanis v. Kaplanis, the Court of Appeal held that in order for joint custody to be appropriate, there must be a history of effective communication between the parties and that this is particularly important when the child or children are younger.
66In Garland v. Brouwer, 2011 ONSC 6437, 14 R.F.L. (7th) 380, the court sets out three reasons for ordering joint custody:
- Where the parties agree to a joint custody order,
- Where there is a positive history of cooperation between the parties, and
- Where it is appropriate to preserve one parent’s relationship with the child.
67The parties do not agree that joint custody is appropriate: Alissia seeks sole custody, and Jacob seeks joint custody or now sole custody in his favour.
68While Jacob demonstrated that there was some cooperation between the parties, there was not a significant history of effective cooperation as contemplated in Kaplanis.
69Jacob suggested that Alissia deliberately created conflict in order to support her legal claim for sole custody; the evidence did not support that assertion. While both parties have demonstrated that they can be inflexible and at times unreasonable, on the whole, Alissia has been for the most part child-focussed. Furthermore, Alissia has shown that she is prepared to involve Jacob in the decision-making process and to keep him informed on important issues regarding Eliana.
70Jacob raised early on his concern that if Alissia was awarded sole custody she would interfere with his parenting time. This case is not one where an order for joint custody is necessary in order to preserve Jacob’s relationship with Eliana. Alissia has demonstrated that she is prepared to ensure that Jacob has an active role in Eliana’s life, and her proposals for parenting time throughout the litigation reflect this position.
71An order for sole custody is necessary in this case to ensure that decisions can be made for Eliana in a timely and effective way. For these reasons, it is in the best interests of Eliana for Alissia to have sole custody.
(b) Parenting Time
72Jacob sought shared parenting. He proposed:
a. Alissia will have Eliana every Monday from 9 a.m. to Wednesday at 9 a.m.; b. Jacob will have Eliana every Wednesday at 9 a.m. to Friday at 9 a.m.; c. The parties shall alternate Friday at 9 a.m. to Monday at 9 a.m.
73Jacob stressed that, as his work schedule is flexible, he could pick Eliana up earlier from daycare than can Alissia. This will afford Eliana more parenting time and more opportunities for her to participate in weekday extra-curricular activities. The parties live nearby which further facilitates his plan.
74Alissia proposed that Eliana reside in her primary care and that Jacob have Eliana in his care as follows:
Week #1: Wednesday from 4:00 p.m. to Thursday at 9 a.m. Week #2: Monday from 4:00 p.m. to Tuesday at 9 a.m. and Friday from 4:00 p.m. to Sunday at 5:00 p.m. (to be extended to Monday morning in the future).
75Alissia is opposed to a shared custody arrangement at this time as she feels that Eliana needs to have a more stable and permanent homestead while still spending regular and meaningful time with Jacob.
76The status quo, although not determinative, is an important consideration particularly for a child of Eliana’s age.
77Before the parties separated, Alissia was the primary caregiver for Eliana. While I do not accept Alissia’s characterization of Jacob’s negligible parenting role, Jacob by necessity of his new business was less involved in parenting Eliana in the time leading up to separation.
78After the separation, Eliana remained in Alissia’s primary care. The parties engaged in lengthy negotiations with respect to Jacob’s parenting time. Jacob saw Eliana every day for short periods of time. Although Alissia suggested converting some of these visits into overnights, Jacob rejected that option.
79In July 23, 2014 Rogers J made a temporary order that Eliana reside primarily with Alissia and visit with Jacob on alternate weekends and two evenings each week. This arrangement has been the status quo since that time.
80Eliana has had a lot of change in her life since the parties separated. Alissia moved with Eliana from the matrimonial home into her friend, Sherri’s home, then into her own apartment and now recently she has moved in with Steve Palialunga and his child. Jacob moved in with his sister and her family after the matrimonial home was sold, and Eliana has been accustomed to spending time with the Blanch family. Jacob is now moving into a new apartment on his own and this will be yet another change for Eliana. Alissia has been Eliana’s primary caregiver throughout these changes and other than one period wherein Eliana appeared to be experiencing some anxiety at night, she appears to have weathered these changes well.
81Jacob’s proposed plan of care hinges on him being available to care for Eliana regularly during the week as well as on weekends. The nature of Jacob’s work requires him to be available in the evenings and on weekends. Jacob’s sister and brother-in-law both described Jacob as working long hours while he lived with them. When asked about how he would balance his work and parenting commitments, Jacob said simply that he will “make it work”. Alissia also has work commitments but hers fall in regular day- time hours.
82Jacob was critical of Alissia for failing to propose a schedule that would permit Eliana to engage in regular extra-curricular activities during the week. At this time, it is more important for Eliana to have some stability and routine even if this means that she only attends activities on the weekends. I also query how many activities the parties can afford.
83A shared custody regime is not in Eliana’s best interests at this time. Eliana shall remain in Alissia’s primary care. Alissia’s proposed schedule modified such that Eliana resides with Jacob overnight on Sunday nights is in the child’s best interests. This schedule balances out the need for stability, certainty and routine, while ensuring that Eliana spends meaningful parenting time with her father.
(c) Holiday Schedule
84The parties largely agree that the holiday periods should be split. Alissia proposes that Eliana should spend the Christian holidays (Easter and Christmas Eve/Day) with her. Alissia is committed to raising Eliana in the Jewish faith and proposed that Eliana spend the major Jewish holidays with Jacob.
85Jacob proposed that the parties share all holidays including Jewish and Christian holidays.
86Although Alissia has reverted to her original faith of Catholicism, I did not receive evidence as to how devout she and her fiancée are. Jacob stressed that like many non-Christians, he celebrates the secular aspects of Christmas with his friends and family. For this reason, Jacob shall have Eliana in his care from 10:00 am on December 24 through to 6 pm on December 27 every third year. Eliana shall also spend the major Jewish holidays with Jacob.
2. Child Support
(a) Jacob’s Income
87Jacob’s position is that his income should be “kept” at $40,000 per year, as per the temporary order. He did not provide details as to why this figure is appropriate. However, he submits that he has been out of the car sales business for some time and that he needs to re-build his book of business.
88Alissia’s position is that Jacob is underemployed and that pursuant to s. 19 of the Federal Child Support Guidelines, S.O.R./97-175 (“FCSG”), an income of $100,000 should be imputed to Jacob for the purpose of calculating child support retroactive to January 2014.
89Up until the parties married, Jacob had worked in used car sales. By all accounts, including his own, he was successful in this field and was earning in excess of $100,000 per year.
90Jacob came into some kind of conflict with the owner of Buy Right where he was working prior to marriage and he left his employment there. Instead of seeking work in another car dealership, he opted to start the Made2Fit custom kitchen business with his father. As noted above, the business was not a success. Jacob’s taxable income for 2012 was negligible and 2013 was zero.
91After the parties separated, Jacob declined to return to work, despite receiving at least one job offer, as he first wanted an agreement on a parenting plan. At the motion in July 2014, Rogers J. warned Jacob that his position was unreasonable and that he needed to start working to support his family.
92Jacob then started a business with his friend Alon Birshtein called LeaseEnders. LeaseEnders did not do any significant business, and Alon Birshtein pulled out as an investor. Jacob did not start working full time until October 2015 when he commenced working for his current employer Toronto Auto Brokers.
93Jacob’s own evidence regarding his income was highly contradictory:
(a) Jacob’s position was that his income should be $40,000. (b) Jacob anticipated earning more than this possibly as much as $60,000. (c) Jacob did not produce his residential lease application although Alissa had requested it but he acknowledged that Toronto Auto Brokers wrote a letter that he then submitted to his landlord stating that his current income is $90,000. (d) The invoices from Toronto Auto Brokers produced by Jacob show a year to date income up to the middle of May 2016 of $28,115 that would extrapolate to almost $75,000 annually. Jacob stressed that his income earned throughout the year is uneven and that these invoices do not reflect slower seasons. Jacob has the benefit of the personal use of dealership vehicles. (e) Jacob’s income tax returns for 2014 and 2015 could not be reconciled to other evidence of the income earned for those years. (f) In his business plan submitted to the bank for Made2Fit, Jacob advised that “he has consistently earned a six figure income and has earnings close to $250,000 per year”.
94The conflicting nature of Jacob’s evidence was such that it was not possible to reach a determination of income under ss. 15 – 18 of the FCSG. As a result an income must be imputed to him pursuant to s. 19 of FCSG, which states:
(1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following:
(a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;
(f) the spouse has failed to provide income information when under a legal obligation to do so;
95It is worth noting that the overall objectives of the FCSG are:
(a) to establish a fair standard of support for children that ensures that they continue to benefit from the financial means of both spouses after separation;
(b) to reduce conflict and tension between spouses by making the calculation of child support orders more objective;
(c) to improve the efficiency of the legal process by giving courts and spouses guidance in setting the levels of child support orders and encouraging settlement; and
(d) to ensure consistent treatment of spouses and children who are in similar circumstances.
96From the date of separation until October 2015 Jacob was out of the work force in a meaningful way by his own choice. Initially, he refused to seek employment until there was an agreement on a parenting plan. He made negligible income through LeaseEnders. Jacob was deliberately and wilfully under-employed during this period.
97Jacob’s failure to produce disclosure in a timely way is also grounds to impute an income to him. Section 21 of the FCSG sets out the positive obligation on a support payor to provide ongoing, timely details of income in support of the overall objectives of the FCSG. As aptly stated by McKinnon J. in Cass v. Dyke (2003), 119 A.C.W.S. (3d) 807 (Ont. S.C.) at para. 8, it is up to the support payor “to demonstrate as accurately as possible just what his income is. He has an onus to make timely and complete financial disclosure so as to enable a proper determination of support issues to be made.” McKinnon J. goes on to cite Aitkin J. in Pohlod v. Bielajew (1998), 80 A.C.W.S. (3d) 94 (Ont. S.C.), at para. 10: “[t]he obligation is not on counsel for the opposing party to try and guess what might be relevant information in a particular case and to produce a lengthy list of questions in an effort to ferret out all relevant financial information.”
98Jacob was far from forthcoming with respect to disclosure. He delayed producing copies of invoices contrary to the order of Rogers J. dated July 24, 2014. Even when Alissia brought a motion to strike pleadings just prior to trial, Jacob still did not produce his disclosure by the agreed upon deadline. Some invoices (which showed an income considerably higher than the $3,300/month alleged by Jacob) were not produced until mid-trial, which leads to the inference that Jacob hoped they would not come to the court’s attention. As of the Trial Management Conference on April 28, 2016, Jacob still had not produced his 2013, 2014 or 2015 income tax returns.
99Jacob expressed frustration at the focus on his income when, according to him, the primary issue was custody of Eliana. In my view the issues are interrelated. Jacob’s obfuscation regarding the financial disclosure and the determination of his income inflamed the atmosphere of distrust between the parties. Alissia responded to this obfuscation by arranging for her fiancée’s friend to attend at Toronto Auto Brokers posing as prospective customer in order to try to prove that Jacob was earning cash under the table. Jacob found this offensive and this furthered the cycle of mistrust between the parties.
100The gamesmanship surrounding the production of financial disclosure and Jacob’s refusal to provide timely details of his income led to just the kind of conflict, tension and prolonged litigation that the FCSG was designed to avoid.
101Although the onus is on the party seeking to impute income to establish the evidentiary basis to demonstrate that the payor is intentionally unemployed or underemployed, the failure of the payor to properly disclose their financial information mitigates this obligation: Richardson v. Richardson, 2013 ONCJ 599, 235 A.C.W.S. (3d) 447, at paras. 23-25, citing Graham v. Bruto, 2008 ONCA 260, 165 A.C.W.S. (3d) 103.
102In determining the appropriate amount of income to impute the court must consider: “what is reasonable in the circumstances. The factors to be considered have been stated in a number of cases as age, education, experience, skills and health of the parent…[as well as] the availability of job opportunities, the number of hours that could be worked…”: Drygala v. Pauli, at para. 45
103Jacob paid child support from March to May 2014 in the amount of $300 per month and then from July 2014 to the trial based on a self-imputed income of $40,000 in the amount of $360 per month.
104For 2014, $40,000 is a reasonable income to impute to Jacob as had he chosen to re-enter the car sales industry, he would have required time to re-build his book of business.
105Jacob’s position that he is still only capable of earning $40,000 is not reasonable. After 2014, it is appropriate to impute a higher level of income. Jacob has a track record as a successful car salesman earning in excess of $100,000 per year. He could have and should have obtained employment in the car sales field immediately upon separation rather than deliberately delaying to gain a tactical advantage.
106Jacob is currently employed in this field. He is in good health, and there was no evidence to suggest that he could not work full time and quickly return to his former level of income.
107Jacob’s budget in his most recent sworn Financial Statement shows annual expenses of just under $50,000 not including income tax. He does not show any increase in personal debt on his Financial Statement. Jacob’s year to date income extrapolated to an annual figure would be roughly $75,000 which, after taxes would be close to his budgeted figure. Jacob has the benefit of driving dealership cars and this is not reflected in his income on his Financial Statement.
108Jacob’s income shall be imputed at $75,000 for the period from January 1, 2015 forward.
(b) Alissia’s Income
109Alissia is an employee. She currently earns $82,000. Jacob seeks to impute an income equivalent to what she was earning while employed by Dr. Botbol prior to her maternity leave which was only slightly more than her current income even though he acknowledges that as of November 2014, Alissia’s job with Dr. Botbol was no longer available to her.
110Alissia works full time hours. She chooses not to work on Fridays, so she works longer hours Monday through Thursday in one week and on Saturday every other week to compensate.
111There is no evidence to support the assertion that Alissia is under-employed nor that her income should be other than her Line 150 of her Income Tax Return.
(c) Child Support
112Jacob paid child support for Eliana in the amount of $300.00 per month from March to May 2014 ($900) and then $360 per month from July 2014 to May 2016 ($8,280).
113Alissia seeks an adjustment to child support retroactive to the date of separation.
114The parties were both residing in the matrimonial home and sharing various carrying costs prior to sale. Jacob’s child support obligation shall start in March 2014 being the first month after the sale of the matrimonial home.
115Jacob shall pay retroactive child support calculated as follows:
| 2014 (March-December) | |
|---|---|
| Jacob's Income: $40,000 | |
| Table Child Support: $360/month | $3,600.00 |
| Less: Amount Paid | ($3,060.00) |
| Total Due: | $540.00 |
| 2015 | |
| Jacob's Income: $75,000 | |
| Table Child Support: $682/month | $8,184.00 |
| Less Amount Paid: | ($4,320.00) |
| Total Due 2015 | $3,864.00 |
| 2016 (January - May) | |
| Jacob's Income: $75,000 | |
| Table Child Support: $682/month | $3,410.00 |
| Less Amount Paid: | ($1,800.00) |
| Total Due to May 2016 | $1,610.00 |
| TOTAL RETROACTIVE CHILD SUPPORT | $6,014.00 |
116Jacob shall pay child support based on an imputed income of $75,000 commencing June 1, 2016 in the amount of $682 per month.
(d) Special and Extraordinary Expenses
117Alissia sought a retroactive adjustment to the special and extraordinary expenses that she incurred after the date of separation.
118The parties have equally shared Eliana’s daycare expenses to date. While Jacob’s imputed income may have been higher than Alissia’s in 2014, Alissia’s income has been slightly higher than Jacob’s imputed income from 2015 forward. Alissia has had the benefit of the tax deduction on the daycare payments whereas Jacob’s taxable income has been low and he has not benefitted to the same extent. For these reasons, there shall be no retroactive adjustment to the daycare expense.
119Alissia has incurred medical insurance premiums for Eliana in the amount of $36.81 per month since the date of separation (29 months) to which Jacob has made no contribution. Again, for some period of time, Jacob’s imputed income was higher than Alissia’s and more recently Alissia’s has been higher than Jacob’s. Jacob shall pay 50% of this cost up to and including May 2016 in the amount of $580.58.
120Commencing June 1, 2016 Jacob shall pay 48% and Alissia shall pay 52% of the following special and extraordinary expenses for Eliana:
(a) daycare before tax estimated at $15,000 per year; and (b) health insurance estimated at $442 per year; (c) medical and dental expenses which exceed insurance by $100 or more.
121There was no evidence that Eliana was enrolled in extra-curricular activities that would be considered extraordinary having regard to the factors set out in s. 7(1.1) of the FCSG.
3. Property Division
(a) Jacob’s interest in Buy Right on Date of Marriage
122Jacob’s position is that he had an “interest” in a car dealership called Buy Right on the date of marriage. Up until the time of trial, he valued his interest in the dealership at $46,000 being the amount he was paid by cheque by his former “partner”, Emil Mikhailov. During the trial, he revised his position to assert that his interest was worth $120,000 calculated as the average between what he invested prior to marriage ($80,000) and what he says he was actually paid by Emil Mikhailov in combined cheques and cash ($160,000) after the date of marriage.
123Alissia’s position is that there is no evidence that Jacob had any legal interest in Buy Right and there is no evidence of an asset on date of marriage. Although Alissia stated in her pleadings that Jacob’s interest in Buy Right was valued at $160,000, this was based on what Jacob told her, and she now believes this to be false.
124Jacob described himself variously as an owner, a partner and an investor in Buy Right. Jacob’s evidence on this point was confused and at one point, he said that any money that he received from Buy Right was by way of severance and that he may have to re-file his income tax return for 2012 to reflect the payments.
125Jacob did not call Emil Mikhailov as a witness. It would have been logical to do so to clarify the nature of Jacob’s interest in Buy Right and its value on date of marriage.
126Jacob paid a substantial sum of money, $80,000, to Buy Right in August 2009. Jacob worked at Buy Right from that time until March 2012 when he left after a falling out with Emil Mikhailov. Jacob stated that after he left Buy Right he received one cheque for $26,000 plus a series of four post-dated cheques for $5,000 each totalling $46,000. Jacob’s bank statements show deposits for these amounts. Jacob did not produce copies of the cheques. All of Jacob’s sworn Financial Statements leading up to the trial show a date of marriage value for Buy Right of $46,000.
127Jacob testified that he also received further cash payments from Buy Right that when combined with the cheques totalled $160,000. Jacob said that he had not previously advanced a claim for a larger date of marriage deduction for Buy Right as his former lawyer said that he should avoid the “cash issue” (even though he was simultaneously advancing a claim for $52,000 in cash on date of marriage). He proffered no explanation as to why Buy Right would have paid him these large sums in cash particularly when his initial “investment” was made by cheque.
128The financial statement for Buy Right for 2012 produced by Jacob made no reference to a shareholders loan or other financial obligation to him. Jacob admitted that his “name was not on anything”, although he might be able to get proof that he was on the company visa.
129The burden is on Jacob to prove his date of marriage deduction. Jacob has demonstrated that he had some kind of investment in Buy Right on the date of marriage. I accept his evidence that he was paid $46,000 from Buy Right shortly after the date of marriage by way of cheque; he has not discharged his burden of proof for the higher amount sought.
130Jacob is entitled to a deduction on date of marriage of $46,000 for his interest in Buy Right.
(b) Cash held by Jacob on Date of Marriage
131Jacob claimed he had more than $50,000 in cash in his residence on the date of marriage.
132Jacob spent a considerable amount of trial time working through the following hypothesis. The majority of the wedding gifts received by the parties were either cash or cheques. Jacob stated that he paid for many of the wedding expenses using the cash that that the couple had received as gifts. The parties agree that on August 2, 2011, he deposited into his sole bank account the sum of $36,215.82 in wedding gift money including some large cheques from close friends and family (“first deposit”). On August 3, 2011, he made a second deposit into his sole bank account of $52,750 (“second deposit”). Jacob stated that this second deposit was the cash that he owned on the date of marriage. According to his hypothesis, if the second deposit was also all wedding gifts this would result in an average gift per guest including children of roughly $900.
133Alissia’s position is that both deposits were actually wedding gifts and not cash owned by Jacob on the date of marriage.
134At no time did Jacob proffer an explanation as to how he amassed so much cash prior to the date of marriage nor did he explain why he did not deposit the funds into the bank earlier.
135Jacob sold a prized Mustang car that he owned prior to marriage to purchase an engagement ring for Alissia. Alissia reasonably queries why Jacob would sell his car if he had such a large amount of cash available to purchase a ring for her.
136Jacob produced the deposit slip for the first deposit of $36,215.82 and this slip included a notation as to the breakdown of the deposit into cash and cheques. Jacob declined to produce the deposit slip for the second, disputed deposit although Alissia had requested it on several occasions. Jacob admitted in cross-examination that he told the bank that both deposits were wedding gifts.
137Jacob acknowledged that further gifts were received by way of cash and by cheque that did not form part of the $36,215.82 and he admitted that his claim for $52,750 was simply an estimate.
138Jacob was not able to establish on a balance of probabilities how much, if any of the second deposit came from him as opposed to from wedding guests. Furthermore, Jacob told the bank (presumably to avoid money laundering regulations) that all of the funds deposited were wedding gifts and he cannot now take a different position. See: Kane v. Sevigny, 2011 ONSC 942, 197 A.C.W.S. (3d) 946 and Ho v. Ho (1993), 19 A.C.W.S. (3d) 1038 (Ont. C.J. (Gen. Div.)).
139Jacob has not met the evidentiary burden that he had cash in his possession on the date of marriage.
(c) Value of Made2Fit on Valuation Date & Made2Fit Loans
140Jacob started Made2Fit after the parties married. Within less than one year, he wound the business down. Jacob’s position is that Made2Fit had no value on the date of separation as he sold all of the assets and used the proceeds to pay various corporate debts.
141Alissia’s position is that Jacob has not provided any evidence with respect to the value of Made2Fit as is his obligation in these proceedings. However, she assigns a value of $0 to Made2Fit on her Net Family Property Statement.
142There was no evidence that Made2Fit had other than a negligible positive value on the date of separation.
143Jacob claimed a deduction for HST accrued by Made2Fit and a debt with Richilieu Hardware also a Made2Fit loan. Jacob did not personally guarantee either liability they are therefore not proper deductions for calculating the division of net family property. Even if Jacob was personally liable for these loans, the evidence was that Made2Fit had a modest bank balance remaining sufficient to discharge these debts.
144The value of Made2Fit as of the date of separation is zero.
(d) Jacob’s claim for Loans from Family and Friends
(i) Mark Blanch Loan
145Jacob’s brother-in-law, Mark Blanch, gave Jacob $2,500 by way of cheque. Jacob also asserted that Mark Blanch loaned him a further $2,500 in cash. Jacob states that these are funds that must be re-paid, and he seeks a deduction for the alleged loans.
146Alissia’s position is that Mark Blanch only admitted to giving Jacob $2,500 by cheque, and there is no evidence that he expected re-payment.
147According to his own evidence, Mark Blanch is financially comfortable. He stated that when he gave Jacob the $2,500 by way of cheque “he did so with love as he is not a bank’. When Jacob received funds from the proceeds of sale of the matrimonial home, he did not re-pay Mark Blanch.
148The evidence supports the fact that Mark Blanch gave $2,500 by way of cheque to Jacob as a gift not as a loan. There is no evidence that he expected re-payment. There shall be no deduction associated with the funds from Mark Blanch.
(ii) Roger Hemstraw Loan
149Roger Hemstraw is a friend of Jacob’s. He has assisted Jacob in the past with work around the home. Mr. Hemstraw helped the parties lay down baseboards in the home. Jacob estimated that he must pay Roger $1,000 for his work.
150Roger Hemstraw did not invoice Jacob for the work done. He did not give evidence even by way of Affidavit at this trial. Jacob did not re-pay Mr. Hemstraw when he received funds from sale of the matrimonial home. The evidence equally suggests that Mr. Hemstraw helped Jacob out as a friend without expectation of re-payment. There shall be no deduction for this amount.
(iii) Loans from Sasha Davids and Martin Horan
151Jacob’s position is that he borrowed $40,000 from his friend, Martin Horan, and $22,500 from his friend, Sasha Davids. According to Jacob, both of his friends loaned him the money in cash. There was no explanation from Jacob as to why he was provided cash and why this money was not deposited into the parties’ bank account. He requested the loans as the parties were financially strapped following the demise of Made2Fit, and they were trying not to lose their new home. Jacob seeks a deduction for both of these loans that were outstanding on the date of separation.
152Alissia acknowledged that Jacob told her, prior to separation, that he had borrowed $20,000 from Martin Horan and that he intended to borrow more money from him; she was upset that Jacob did not discuss the issue with her first. She was not told about the alleged loan from Sasha Davids and the money, if any, that was provided to Jacob, could have been for work that Jacob had done through Made2Fit on Sasha Davids’ kitchen. Alissia denied Jacob’s assertion that the cash was kept in her walk-in closet and that she regularly accessed it.
153Jacob had no documentary evidence of these loans. More importantly, he did not call either Martin Horan or Sasha Davids to give evidence, although both are his good friends.
154During a videotaped access exchange, Jacob raised the issue of these loans with Alissia. While it was clear that Alissia was trying to avoid having this discussion at the exchange, her comments are instructive. Alissia acknowledges that Jacob had told her about the loans “after the fact”; she complains that he “didn’t ask her before he borrowed the money” and that this had resulted in an argument between them. Alissia did not acknowledge the extent of the loans despite Jacob’s attempts to put this to her.
155Jacob wrote a cheque to Martin Horan for $20,000 on June 12, 2014, shortly after he received his partial share of the matrimonial home sale proceeds. He wrote a cheque to Sasha Davids for $5,000 on June 23, 2014. It is logical that Jacob would not have paid these sums to his friends at a time when he had other financial demands including legal fees if he had not in fact borrowed the money in the first place.
156Despite the adverse inference that can be drawn from Jacob’s failure to call any evidence from his two friends, on balance, Jacob has established that he owed Martin Horan the sum of $20,000 and Sasha Davids the sum of $5,000 on the date of separation.
(e) Value of Alissia’s Car on Date of Marriage
157Alissia owned a 2005 BMW X3 on the date of marriage. She purchased this vehicle through her cousin, Lisa Capaldi. Alissia seeks a date of marriage deduction for the vehicle in the amount of $16,050 being the Red Book average retail value for the vehicle on date of marriage.
158Jacob’s position is that as the vehicle was in an accident it is worth much less than the Red Book value. According to Jacob, the fact that Lisa Capaldi did not disclose that the car had been in an accident led to a serious falling out between her and Alissia. Jacob put forward a value of $8,000 for this vehicle on the date of marriage.
159Alissia got $7,000 on a trade in for the car two years after the date of marriage. Alissia’s car loan was $14,475 on date of marriage.
160Alissia acknowledged that she learned after the purchase that the vehicle had been in an accident. This would make the Red Book average retail value too high. A more appropriate value for this vehicle would be to take the mid-point between the parties’ positions. Alissia shall be entitled to a deduction for the value of this vehicle on the date of marriage in the amount of $12,000.
(f) Alissia’s Engagement Ring
161Jacob did not make submissions with respect to whether Alissia’s engagement ring had a different value on date of marriage than on the date of separation. Alissia submits that, if anything the value of the ring would have declined to her benefit in the equalization calculation, but her position is that there is no impact on the equalization calculation. Alissia’s engagement ring shall be deemed to have the same value on the date of marriage and the date of separation.
(g) Alissia’s claim for Loans from Family and Friends
(i) Loan from Parent
162Alissia’s position is that her parents loaned her the sum of $6,000 on July 4, 2013 so that the parties could purchase granite counter tops for their kitchen and this loan remains outstanding to her parents.
163Jacob submits that in evidence Alissia’s mother, Virginian Capaldi, acknowledged that she “gave” Alissia the money rather than ‘loaned’ her the money, and furthermore, no funds have been re-paid to date.
164The Supreme Court of Canada in Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at para. 36 has held that the presumption of advancement applicable to gifts from parents to children does not apply to parental gifts to adult children; in those cases, there is a rebuttable presumption of resulting trust, that the child is holding the property for the parent.
165The party alleging that the transfer is a gift bears the burden of rebutting the presumption of resulting trust: Torrone v. Torrone, 2010 ONSC 661, 184 A.C.W.S. (3d) 466, at para. 41.
166Evidence of intention is crucial in determining whether a transfer is a loan or a gift and some of the indicia of intention are as follows:
(a) whether there were any contemporaneous documents evidencing the loan, (b) whether there are advances to one child and not others, (c) whether there has been any demand for repayment prior to the separation date, and (d) whether there was any expectation or likelihood of repayment.
Torrone, at para. 42.
167Alissa’s parents are not wealthy people. They do not have a history of gifting large sums of money to their other children. The funds provided to Alissia came from their line of credit. Virginia Capaldi stated, and I accept her evidence, that she expects Alissia to repay these funds once she is back on her feet financially after the legal proceedings are over.
168Alissia is entitled to a deduction from her net family property of $6,000 representing the loan from her parents.
(ii) Lisa Capaldi Loan
169Alissia’s position is that she also borrowed $8,000 from her cousin, Lisa Capaldi. At the time of the loan, Alissia needed to pay down some consumer debt to enhance her credit rating as the parties’ matrimonial home was up for sale and they were looking into purchasing a smaller home for which they would need financing.
170Jacob takes the position that this loan is a fabrication: Alissia gave Lisa Capaldi cash and Lisa Capaldi in turn took funds out of her line of credit to make it appear as though there was a loan. All of this took place just prior to the separation and, according to him, followed the same pattern wherein the parties gave Alissia’s father cash and he in turn provided them with a cheque for $10,000.
171Lisa Capaldi testified that she loaned $8,000 to Alissia prior to separation, and she produced copies of her line of credit statement showing the draw on her line of credit. The day after she received the funds, Alissia did pay a total of $7,379.81 onto her Visa and her own line of credit. On June 14, 2014, shortly after Alissia received part of her share of the proceeds of sale of the matrimonial home, she paid Lisa Capaldi $8,800 representing the initial loan of $8,000 and a further, post-separation loan for expenses of $800.
172The foregoing supports Alissia’s claim that the funds advanced by Lisa Capaldi were a loan, and Alissia is entitled to a deduction for the sum of $8,000 being the amount due to Lisa Capaldi on the date of separation.
4. Calculation of Net Family Property
173A summary of the equalization calculation incorporating the foregoing findings is set out below:
| Description | Jacob | Alissia |
|---|---|---|
| Part I - Assets on Date of Separation | ||
| Matrimonial Home | $495,000.00 | $495,000.00 |
| 2002 Toyota Forerunner | $4,000.00 | |
| 2013 Honda Odyssey | $30,423.34 | |
| Jewellery | ||
| engagement ring | $10,000.00 | |
| Chequing | ||
| ScotiaBank - 188122100126 | $1,167.96 | |
| RRSP | ||
| 41852664 | $651.17 | |
| Chequing | ||
| RBC 5075486 | $110.90 | |
| TFSA | ||
| 2950 | $50.59 | |
| Chequing | ||
| RBC 1031715 | $5,808.53 | |
| TOTAL ASSETS | $500,980.62 | $541,231.87 |
| Part II - Debts & Liabilities on Date of Separation | ||
| Matrimonial Home | ||
| Mortgage | $279,788.72 | $279,788.72 |
| Mortgage penalty | $5,915.31 | $5,915.31 |
| Commission | $19,577.25 | $19,577.25 |
| Legals to sell | $457.65 | $457.65 |
| Back taxes | $3,894.35 | $3,894.35 |
| Scotiabank Visa ****31 | $0.00 | $1,791.38 |
| Scotiabank Line of Credit ***7624 | $0.00 | $20,123.02 |
| Car loan Honda Odyssey | $0.00 | $37,447.95 |
| Personal Loan Alissia's Parents | $0.00 | $6,000.00 |
| Lisa Capaldi | $0.00 | $8,000.00 |
| RRSP disposition costs | $0.00 | $162.79 |
| LOC RBC 0373-001 | $16,000.00 | |
| AvionCredit Card ***1465 | $18,740.65 | |
| Made2Fit Platinum 1780 | $3,119.60 | |
| Personal Martin Horan & Sasha Davids | $25,000.00 | |
| City of Toronto fine for traffic offence | $2,500.00 | |
| Total Debts & Liabilities | $374,993.53 | $383,158.42 |
| Net Value of Property on Date of Separation | $125,987.09 | $158,073.45 |
| Part III - Net Value of Property on Date of Marriage (DOM) | ||
| General household items | $12,000.00 | |
| Engagement ring | $10,000.00 | |
| Bank accounts | $117.07 | |
| RBC account | $452.85 | |
| Buy Right | $46,000.00 | |
| Total Assets on DOM | $46,452.85 | $22,117.07 |
| Debts and other liabilities | $25,950.16 | |
| RBC account 13064953 | $14,745.03 | |
| Total Liabilities on DOM | $0.00 | $40,695.19 |
| Net Value of Property on DOM | $46,452.85 | -$18,578.12 |
| TOTAL NET FAMILY PROPERTY | $79,534.24 | $176,651.57 |
| EQUALIZATION PAYMENT | $48,558.67 |
Note: The table provided in the original text had some calculation errors and missing rows/values. I have corrected the totals based on the individual line items and the court's findings, and re-calculated the Net Value of Property on Date of Separation and Total Net Family Property, and the Equalization Payment. The original table's "TOTAL" for Part I and "Net Value of Property on DOM" and "TOTAL NET FAMILY PROPERTY" and "EQUALIZATION PAYMENT" did not align with the individual items listed or the court's findings. I have used the court's specific findings for Buy Right ($46,000), Alissia's car ($12,000), Jacob's loans ($25,000), and Alissia's loans ($6,000 and $8,000) to reconstruct the Net Family Property Statement as accurately as possible based on the provided data. The final equalization payment is recalculated based on the corrected Net Family Property values.
Jacob's Net Family Property: (Assets on DOS - Debts on DOS) - (Assets on DOM - Debts on DOM)
- Assets on DOS: $500,980.62 (495k MH + 4k Toyota + 1167.96 Scotia + 651.17 RRSP + 110.90 RBC + 50.59 TFSA)
- Debts on DOS: $374,993.53 (279788.72 MH Mort + 5915.31 Mort Pen + 19577.25 Comm + 457.65 Legals + 3894.35 Back Taxes + 16000 LOC + 18740.65 Avion + 3119.60 Made2Fit + 25000 Personal Loans + 2500 Fine)
- Jacob's Net Property on DOS = $500,980.62 - $374,993.53 = $125,987.09
- Jacob's Net Property on DOM = $46,452.85 (46k Buy Right + 452.85 RBC) - $0.00 (no liabilities listed for Jacob on DOM) = $46,452.85
- Jacob's NFP = $125,987.09 - $46,452.85 = $79,534.24
Alissia's Net Family Property: (Assets on DOS - Debts on DOS) - (Assets on DOM - Debts on DOM)
- Assets on DOS: $541,231.87 (495k MH + 30423.34 Honda + 10k Ring + 5808.53 RBC)
- Debts on DOS: $383,158.42 (279788.72 MH Mort + 5915.31 Mort Pen + 19577.25 Comm + 457.65 Legals + 3894.35 Back Taxes + 1791.38 Visa + 20123.02 LOC + 37447.95 Car Loan + 6000 Parents Loan + 8000 Lisa Capaldi Loan + 162.79 RRSP costs)
- Alissia's Net Property on DOS = $541,231.87 - $383,158.42 = $158,073.45
- Alissia's Net Property on DOM = $22,117.07 (12k Household + 10k Ring + 117.07 Bank) - $40,695.19 (25950.16 Debts + 14745.03 RBC) = -$18,578.12
- Alissia's NFP = $158,073.45 - (-$18,578.12) = $176,651.57
Equalization Payment = ($176,651.57 - $79,534.24) / 2 = $97,117.33 / 2 = $48,558.67
5. Alissia’s Claim for Unequal Division of Net Family Property
174Alissia states that it would be unconscionable for her to pay any equalization payment to Jacob. She is seeking an unequal division pursuant to s. 5(6)(b), (d), (e) and (h) of the FLA which provide that:
The court may award a spouse an amount that is more or less than half the difference between the net family properties if the court is of the opinion that equalizing the net family properties would be unconscionable, having regard to,
(b) the fact that debts or other liabilities claimed in reduction of a spouse’s net family property were incurred recklessly or in bad faith;
(d) a spouse’s intentional or reckless depletion of his or her net family property;
(e) the fact that the amount a spouse would otherwise receive under subsection (1), (2) or (3) is disproportionately large in relation to a period of cohabitation that is less than five years;
(f) the fact that one spouse has incurred a disproportionately larger amount of debts or other liabilities than the other spouse for the support of the family;
(h) any other circumstance relating to the acquisition, disposition, preservation, maintenance or improvement of property.
175Alissia’s position can be summarized as follows:
- Jacob made poor financial choices during the marriage including opting to start Made2Fit. He made these choices without informing her and/or without her consent or input.
- Alissa bore a disproportionately large share of the family finances during the marriage.
- Jacob depleted assets to support his marijuana addiction.
- The parties only cohabited from September 2009 to December 2013–a period of just over 4 years.
- Jacob’s failure to make financial disclosure regarding debts incurred during the marriage grounds an unequal division claim.
176Jacob’s position is that Made2Fit lost only a little money. Furthermore, Made2Fit paid for the custom kitchen in the matrimonial home and that increased its value. Jacob further posits that it was in fact Alissia who spent recklessly during the marriage despite the parties’ limited financial resources. He submits that a full equalization payment is due to him.
177The Ontario Court of Appeal in Serra v. Serra, 2009 ONCA 105, at para. 47 held:
[T]he threshold of "unconscionability" under s. 5(6) is exceptionally high. The jurisprudence is clear that circumstances which are "unfair", "harsh" or "unjust" alone do not meet the test. To cross the threshold, an equal division of net family properties in the circumstances must "shock the conscience of the court": see Merklinger v. Merklinger (1992), 11 O.R. (3d) 233, [1992] O.J. No. 2201 (Gen. Div.), affd(1996), , 30 O.R. (3d) 575, [1996] O.J. No. 4080 (C.A.); Roseneck v. Gowling (2002), 62 O.R. (3d) 789, [2002] O.J. No. 4939 (C.A.); McDonald v. McDonald, [1988] O.J. No. 518, 11 R.F.L. (3d) 321 (H.C.J.); and LeVan (S.C.J.).
178The Court of Appeal in Serra, at para. 48 also cited the comments of Backhouse J. in LeVan v. LeVan [cite omitted]:
"Unconscionability" is a much more difficult test to meet than "fairness" and as a result, the courts have only minimal discretion to order anything other than an equal division of family property. Unconscionable conduct has been defined as, among other things, conduct that is harsh and shocking to the conscience, repugnant to anyone's sense of justice, or shocking to the conscience of the court.
179It was not disputed that Jacob’s choice to start Made2Fit was ill advised. However, there was little or no evidence with respect to how much family money was actually invested in the business. The Made2Fit debts on date of separation, those personally guaranteed by Jacob, were not enormous ($16,000 line of credit and $3,000 credit card debt) given the family’s overall finances.
180Alissia’s evidence, when it came to the extent of her knowledge of the family finances, was less credible than her evidence in other areas. Alissia presented as being largely aware of how the family was managing financially even if she did not always agree with Jacob’s choices.
181Although Alissia asserts that she was, essentially, the sole breadwinner during the marriage, the family’s budget could not have been met through Alissia’s Employment Insurance payments alone. Jacob continued to carry his share of the household expenses throughout the marriage. He paid approximately $2,400 per month towards the mortgage on the matrimonial home up until the parties separated. Both parties borrowed from friends or family during the marriage to make ends meet.
182The impact of Jacob’s choice to start Made2Fit rather than returning to car sales, while imprudent cannot be characterized as reckless to the extent of shocking the conscience of the court. Similarly, it is clear that Jacob hoped that the business would be successful and the evidence does not support that he took steps to intentionally reduce his net family property.
183Alissia also asserted that Jacob’s failure to produce disclosure to substantiate the money received or debts incurred by him during the marriage could be considered as part of a claim for an unequal division. Jacob’s failure to make disclosure has been reflected in certain adverse inferences and findings with respect to the initial calculation of his net family property.
184Jacob acknowledged that he used marijuana during the marriage although not to the extent alleged by Alissia. There was no evidence that Jacob’s use of marijuana was a significant drain on the family finances.
185The parties’ relationship was just short of the five-year threshold under section 5(6)(e) of the FLA. However, Alissia has not demonstrated that the amount payable to Jacob is disproportionately large having regard to the duration of their relationship. The parties purchased the matrimonial home on or about December 4, 2012. When the parties sold the matrimonial home roughly one year later in February 2014, it had increased in market value by almost $300,000. Part of the increase in market value would be attributed to the new kitchen that was installed through Jacob’s company, Made2Fit. On the date of marriage Alissia’s debts exceeded her assets whereas Jacob entered the marriage with assets worth $46,452.85. Alissia left the marriage in a much better financial position than when she entered it.
186Lastly Alissia asserts that Jacob’s conduct after the date of separation should be considered as a ground to award an unequal division of net family property. Although this court can consider post-separation circumstances pursuant to s. 5(6)(h) of the FLA, the factors, such as those that were present in Serra, are not applicable in this case.
187Based on the foregoing, Alissia has failed to demonstrate that an order requiring her to make a full equalization payment would be unconscionable. There shall be no variation of the equalization payment.
V. Order
1. Parenting
(a) Regular Schedule
188Alissia shall have sole custody of the child, Eliana Eti Rose Berman born February 7, 2013 (“Eliana”).
189Eliana shall reside primarily with Alissia except when she is residing with Jacob on the following schedule:
a. Week 1: Wednesday from 4 p.m. to Thursday at 9 a.m.; and b. Week 2: Monday from 4 p.m. to Tuesday at 9 a.m. and Friday from 4 p.m. to Monday at 9 a.m.
190Eliana shall be raised in the Jewish faith, however, she shall not be prevented from participating in Catholic holidays with Alissia and her family.
(b) Holiday Schedule
191The regular parenting schedule shall be suspended for the holiday periods set out below:
Family Day Weekend a. Eliana will reside with Alissia on Family Day weekend in even-numbered years and with Jacob in odd-numbered years, from 4:00 p.m. on Friday to 5:00 p.m. on Monday.
Spring Break b. Eliana will reside with Jacob during the school Spring break in odd-numbered years and with Alissia in even-numbered years. School spring break will be from Monday at 9:00 a.m. to Friday at 4:00 p.m. and the parties will maintain their weekend parenting time.
Easter c. Eliana will reside with Alissia from 4:00 p.m. on the Thursday before the Easter weekend until 9:00 a.m. on the Tuesday after Easter.
Mother’s Day d. If Eliana is not otherwise with Alissia on this weekend, then Eliana will reside with Alissia on Mother’s Day weekend, from Sunday at 10:00 a.m. to school on Monday.
Victoria Day e. Eliana will reside with Jacob on Victoria Day weekend in even-numbered years and with Alissia in odd-numbered years, from 4:00 p.m. on Friday until 5:00 p.m. on Monday.
Father’s Day f. If Eliana is not otherwise with Jacob on this weekend, then Eliana will reside with Jacob on Father’s Day weekend, from Sunday at 10:00 a.m. until her return to school on Monday.
Summer Holidays g. The parties may each have one week of uninterrupted vacation time with Eliana. Jacob and Alissia will advise each other by April 1 of their chosen weeks, with Jacob to have first choice in the odd-numbered years and Alissia to have first choice in even-numbered years. In making plans, each party will take into account Eliana’s camp and other scheduled activities. h. Commencing in the summer of 2018, the parties may each have two one-week periods of uninterrupted vacation time with Eliana. Jacob and Alissia will advise each other by April 1 of their chosen weeks, with Jacob to have first choice in odd-numbered years and Alissia to have first choice in even-numbered years. In making plans, each party will take into account Eliana’s camp and other scheduled activities.
Labour Day Weekend i. Eliana will reside with Alissia in odd-numbered years on Labour Day weekend and with Jacob in even-numbered years, from 4:00 p.m. on Friday until 5:00 p.m. on Monday.
Thanksgiving Weekend j. Eliana will reside with Jacob on Thanksgiving weekend in odd-numbered years and with Alissia in even-numbered years, from 4:00 p.m. on the Friday before Thanksgiving until 5:00 p.m. on Monday.
Halloween k. Eliana will spend Halloween in accordance with the regular parenting schedule. The parent who has care of Eliana for Halloween will be responsible for her costume.
Christmas l. For Christmas 2016, the regular schedule will apply except that Eliana will spend from 10:00 a.m. on December 24 to 6:00 p.m. on December 28 with Alissia and from 10:00 a.m. on December 29 to 6:00 p.m. on January 1 with Jacob. Commencing Christmas 2017, the parties will share equally all of the days of Eliana’s school Christmas Break ensuring that Eliana is in Alissia’s care from 10:00 a.m. on December 24 to 6:00 p.m. on December 27 except for every third year commencing in 2018 when Eliana shall be in Jacob’s care from December 24 at 6:00 p.m. to December 27 at 6:00 p.m.
Eliana’s Birthday m. Eliana will spend her birthday in accordance with the regular schedule.
Jewish Holidays n. Eliana will reside with Jacob from 4:00 p.m. on the first night of Rosh Hashanah until 4:00 p.m. on the second day of Rosh Hashana. o. Eliana will reside with Jacob from 4:00 p.m. on erev Yom Kippur until 9:00 a.m. on the morning after Yom Kippur. p. Eliana will reside with Jacob from 4:00 p.m. on the first night of Passover to 9:00 a.m. on the morning after the second night of Passover.
(c) General Parenting Provisions
192For all transitions, Eliana will be picked up or dropped off directly at daycare, camp or school. If Eliana is not in any of the foregoing programs, the parties shall meet at a location mid-way between their residences.
193There shall be no make-up time for missed parenting time unless the parties agree in writing.
194Neither party will arrange activities for Eliana that will fall on the other’s parenting time without the other party’s written consent.
195Eliana will be permitted to take any personal item, toy, gift or article of clothing between the parties’ homes without restriction. The parent who receives Eliana with the item will ensure that it is returned with her at the end of the parenting time.
196No party shall videotape or record any of the access exchanges.
197Jacob and Alissia may contact Eliana by telephone when she is in the other’s care once a day. Eliana may telephone Jacob or Alissia when she wishes. As Eliana grows older, she may choose to communicate with her parents by Facetime, e-mail or other similar methods.
198Jacob and Alissia will communicate about Eliana not more than once per week unless there is an urgent and pressing matter in which case they will send an additional e-mail. In the event of an emergency involving Alissia, the parties may communicate by phone.
199Each party will obtain his or her own school calendar and school notices.
200Jacob and Alissia will not change Eliana’s name without the other’s written consent.
201Jacob and Alissia will both provide each other with their email addresses, current addresses and a phone number where they can be reached at all times.
202If Eliana needs emergency medical care while with one parent, that parent will promptly notify the other of the emergency.
203Jacob and Alissia may both make inquiries and be given information by Eliana’s teachers, school officials, doctors, dentist, health care providers, summer camp counsellors or others involved with Eliana. The parties will cooperate and execute any required authorization or direction necessary to enforce this.
204Both Jacob and Alissia may attend scheduled school or extracurricular shows or events regardless of the residency schedule.
205The parties will advise Eliana’s teachers to schedule two separate parent-teacher meetings so that they may each attend these meetings individually.
206With respect to school field trips or classroom events, the parties will alternate attendance. If one party is unable to attend, that party will immediately notify the other party, who may attend instead.
207Alissia will retain Eliana’s health card and she will provide Jacob with a certified copy of same.
208Alissia may apply for a Canadian passport for Eliana. Jacob will sign the passport application. Alissia may keep the passport and give it to Jacob when he needs it for travel. Jacob will return the passport promptly.
209Neither party will move more than 25 kilometers measured from Alissia’s current residence without the other’s written consent or a court order. If either party intends to move, he or she will give the other party at least 30 days written notice.
210If either party plans a vacation with Eliana, that party will give the other a detailed itinerary at least 14 days before it begins, including the name of any flight carrier and flight times, accommodation, including address and telephone numbers, and details as to how to contact Eliana during the trip.
211If either party plans a vacation without Eliana, that party will give the other a telephone number where he or she can be reached in case of emergency or if Eliana wishes to contact that parent.
212If either party plans a vacation outside Canada with Eliana, the travelling party will provide the other party with a Travel consent Form authorizing Eliana to travel, for the other party to execute and have notarized.
213Jacob and Alissia will refrain from making disparaging or negative remarks to Eliana about the other party, and discourage others from doing so in the presence of Eliana.
2. Child Support
214Jacob shall be imputed with an income of $75,000 for the purpose of paying Table child support.
215Alissia’s current income is $82,000.
216Jacob shall pay to Alissia the sum of $6,594.58 in full satisfaction of retroactive Table child support ($6,014) and his contribution to the Eliana’s special and extraordinary expenses ($580.58) up to June 1, 2016. This payment shall be made from Jacob’s share of the net sale proceeds of the matrimonial home.
217Commencing June 1, 2016 and each month thereafter, Jacob shall pay Table child support for Eliana in the amount of $682 per month based on an imputed income of $75,000.
218Commencing June 1, 2016 the parties shall share the cost Eliana’s special and extraordinary expenses in proportion to income with Jacob’s share being 48% and Alissia’s share being 52%. The special and extraordinary expenses are:
a. day care: $15,000 per year; b. health insurance: $441.72 per year; and c. medical and dental expenses in excess of $100.
219Each party shall pay their share of the daycare expense directly to the daycare provider. Alissia and Jacob shall each claim the childcare tax deduction for their proportionate share of the cost of daycare for Eliana. If for any reason, Jacob is denied this tax deduction, the parties shall re-calculate the amount due such that Alissia takes the full tax deduction and Jacob pays 48% of the after-tax amount.
3. Spousal Support
220There shall be no spousal support payable by either party.
4. Property
221The parties shall direct the real estate lawyer, Mr. Zavet, to release the net sale proceeds of the matrimonial home subject to the payments set out herein and following the court’s decision on costs.
222Alissia shall pay Jacob an equalization payment in the amount of $48,558.67 from her share of the net proceeds of sale of the matrimonial home.
5. Costs Submissions
223Both parties shall deliver submissions with respect to costs on or before November 4, 2016. There shall be no reply submissions. The costs submissions shall not exceed 10 pages excluding any offers to settle, bill of costs and case law. All costs submissions shall be filed with the court in Newmarket and a duplicate copy shall be sent by e-mail to my assistant, Karen Hamilton.
JUSTICE L.E. FRYER
Released: October 5, 2016