Forbes v. Forbes, 2016 ONSC 7407

CITATION: Forbes v. Forbes, 2016 ONSC 7407

COURT FILE NO.: FD 770/09 Ext 02

DATE: 20161202

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Jeffrey Paul Forbes

Applicant

– and –

Mary Claire Forbes

Respondent

Hamoody Hassan, for the Applicant

Thomas Granger, for the Respondent

HEARD: November 9, 10, 14, 15, 16 and 17, 2016

REASONS FOR JUDGMENT

BONDY J.

A. PRELIMINARY RULING

[1] There were two pre-trial motions brought by the parties. The first by Mary Claire Forbes (“Ms. Forbes”) for a stay of these proceedings, and the second by Jeffrey Paul Forbes (“Mr. Forbes”) for a stay of enforcement of child support. Both motions were dismissed for oral reasons given. In the interest of convenience, I have from time to time repeated portions of those reasons below.

B. INTRODUCTION

1) Nature of the proceeding

[2] This began as a trial regarding two proceedings.

[3] The first proceeding was a motion brought by Mr. Forbes to change the final order of G. A. Campbell J. dated December 4, 2009. The relevant relief sought related to child support and spousal support pursuant to the provisions of the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.).

[4] The second proceeding was an application also brought by Mr. Forbes. Again, the relevant relief sought was child support and spousal support pursuant to the provisions of the Divorce Act.

[5] In the former, Ms. Forbes was the applicant and Mr. Forbes the respondent. In the latter Mr. Forbes was the applicant and Ms. Forbes the respondent.

[6] After the pre-trial motions had been heard but before the evidence portion of the trial commenced, counsel agreed that the application of Mr. Forbes issued December 15, 2010 would proceed and that the motion to change would be abandoned. It was agreed that, pursuant to rule 8(2.1) of the Family Law Rules, O. Reg. 114/99, Courts of Justice Act, R.S.O. 1990, c. C.43, the application would proceed on the basis that the child support analysis would be pursuant to s. 17 of the Divorce Act and the spousal support analysis pursuant to s. 15.2 of the Divorce Act. It was also agreed that the court would consider the answer filed by Mary Claire Forbes on February 25, 2011 for purposes of the trial.

[7] In the interests of avoiding confusion, I refer to Mr. Forbes as the applicant and Ms. Forbes as the respondent throughout these reasons, regardless of which of the two proceedings I am referring to.

2) The parties

[8] The applicant Mr. Forbes is 46 years old. He is a few credits short of a diploma or degree from Sheridan College, which he attended in 1995. He also completed an online computer programming course with Western University in 1995.

[9] The respondent Ms. Forbes is 48 years old. She has a Bachelor of Arts from Western University and a Bachelor of Education from the University of Western Sydney, Australia. Ms. Forbes has been a teacher with the Thames Valley Board of Education since 1998.

[10] The parties were married August 16, 1997 and separated approximately ten years later on December 18, 2007. The separation was the result of a domestic assault to which Mr. Forbes pled guilty. The parties were divorced December 4, 2009.

[11] Ms. Forbes and Mr. Forbes have two children. The oldest is Matthew Paul Forbes (“Matthew”) born August 3, 1998. He lived with his mother until October 31, 2013 and with his father from November 1, 2013 until the date of trial. That was with the exception of a brief return to live with his mother from December 15, 2015 until April 12, 2016. As of the date of trial, he was 18 years of age and living with his father. The youngest is William Albert James Forbes (“William”) born July 11, 2000. As of the date of trial, he was 16 years of age and has lived with his mother since the separation.

3) The conduct of the parties during the litigation

[12] This matter can only be described as highly contentious. Notwithstanding the very straightforward nature of the issues between the parties, the court file occupied two banker’s boxes prior to trial and close to three after trial.

[13] Having reviewed the file, I am left with no doubt that the blame for the cumbersome fashion in which this litigation has proceeded lies primarily with Mr. Forbes. That said, Ms. Forbes shares some responsibility.

[14] As to the conduct of Mr. Forbes, his involvement in this litigation began on May 13, 2009, when the application was served upon him. Mr. Forbes’ participation was less than adequate. On July 8, 2009, McGarry J. ordered Mr. Forbes to serve and file a financial statement. That direction was for the most part ignored. On September 2, 2009, Morissette J. ordered Mr. Forbes to deliver a financial statement. Again, that order was for the most part ignored. On September 16, 2009, Marshman J. ordered child support of $753 per month based upon imputed income of $50,000. She also ordered further document production, failing which Mr. Forbes’ pleadings would be struck. On October 14, 2009, Vogelsang J. struck Mr. Forbes’ pleadings and dismissed his claims. On December 4, 2009, the matter proceeded in front of Campbell J. as a summary undefended trial.

[15] In the end, according to Ms. Forbes’ document brief filed at the original trial, Mr. Forbes had produced only his personal income tax returns for 2006-2008 and some of the bank statements that he had been ordered to produce.

[16] Income of $100,000 per year was imputed to Mr. Forbes at that trial. To be clear, Mr. Forbes maintained that none of this was his fault. To be blunt, for reasons which appear below, I did not believe him.

[17] According to respondent’s counsel, it was not until the Director of the Family Responsibility Office (“FRO”) began collection proceedings that Mr. Forbes showed any interest in these proceedings.

[18] As was observed by Aston J. in his reasons June 1, 2015, once collection proceedings had begun, Mr. Forbes brought three separate proceedings against Ms. Forbes. The first was a motion to set aside the order of Campbell J., which was dismissed by Templeton J. on March 3, 2010. The second was a motion to change his motion to set aside to a motion to change, which Templeton J. allowed. The third was a fresh application, served and filed by Mr. Forbes on December 15, 2010, claiming equalization and spousal support. To be clear, that was done at the direction of Henderson J. The claim for equalization was ultimately dismissed.

[19] Again, as observed by Aston J., Ms. Forbes has incurred significant costs “directly attributable to the clumsy and intransigent manner by which Mr. Forbes has litigated the financial issues.” Ms. Forbes put her legal bills into evidence in this trial. The total spent after the first trial but prior to preparation beginning for this trial was approximately $28,000. I find legal bills of that scale grossly disproportionate to the very simple issues in this matter.

[20] Mr. Forbes’ conduct continued until the commencement of this trial in that the two proceedings initially the subject of this trial co-existed for several years. I heard no reasonable explanation as to why the motion to change had not been withdrawn or abandoned once the application had been commenced.

[21] Mr. Forbes also continued to ignore court orders as of the date of this trial. As an example, Campbell J. ordered that Mr. Forbes was to name Ms. Forbes in trust for the children as irrevocable beneficiary on life insurance policies then in force. He also ordered Mr. Forbes to provide proof annually that the policies remain in effect. Those policies are no longer in effect and Mr. Forbes failed to advise Ms. Forbes of that fact. Mr. Forbes has obtained replacement insurance with his new employer but failed to designate Ms. Forbes in trust for the children as irrevocable beneficiary.

[22] As said above, Ms. Forbes has also frustrated the process but to a lesser extent. For example, her motion for a stay was not brought until the day of trial.

[23] As another example, Ms. Forbes testified at trial that she had called the FRO and advised them that Matthew had moved in with his father. She said that the FRO advised her that a court order was necessary to change the calculation of arrears. As a result, the FRO has been incorrectly assessing Mr. Forbes for child support for two children rather than one. I am aware that Ms. Forbes was no doubt frustrated by Mr. Forbes continued and persistent refusal to honour his support obligations throughout the years. Notwithstanding, Ms. Forbes should have done more. Something as simple as a letter to Mr. Forbes’ lawyer may have been of assistance in correcting the FRO records to reflect Matthew's residency.

[24] There was some suggestion from applicant’s counsel that Ms. Forbes had continued to collect the child tax credit for Matthew. Ms. Forbes testified that she had also placed a call to the Canada Revenue Agency (“CRA”) and that, as a result, it stopped paying her the portion of the credit relating to Matthew. I had no reason to disbelieve that assertion on the evidence before me.

4) The live issues at trial

[25] In the six and a half years that have passed between the date that this application was filed and the date of trial, the live issues have been somewhat narrowed. There was consensus that as of the date of trial, the remaining issues between the parties are limited to the following:

1. The threshold issue of whether the order of Campbell J. imputing income to Mr. Forbes ought to be varied and, if so, what income should be used for purposes of support.

2. Retroactive and ongoing child support.

3. Retroactive and ongoing section 7 expenses.

4. Retroactive and ongoing spousal support for Mr. Forbes.

[26] The applicant acknowledged that if Campbell J.'s order is correct, there are approximately $70,000 in child support arrears outstanding as of the date of trial. Notwithstanding, applicant’s counsel submitted that there was a “pretty good history of effort to pay.”

5) The positions of the parties

[27] It was the applicant's position in argument that, between 2010 and 2015, the appropriate range of imputed income should have been $20,000 to $30,000 rather than the $100,000 that had been imputed by Campbell J. It was also the applicant’s position that it was Ms. Forbes who owed Mr. Forbes child support arrears. That is because, if the applicant's position as to income is accepted, significant arrears of support payable by Ms. Forbes would have accumulated since Matthew began living with his father. According to applicant’s counsel, those arrears would have overwhelmed the $70,000 in arrears owing by Mr. Forbes and that had accumulated as at the date that Matthew moved in with his father.

[28] Finally, it was the applicant’s position that he was entitled to spousal support arrears. He asked the court to find spousal support arrears owing but not to order immediate payment. Rather the arrears would be held in abeyance to be used by Mr. Forbes at a future date as a shield or defence against future child support payments owing by himself to the respondent for the benefit of his son William.

[29] It was the respondent's position that there were about $70,000 in child support arrears owing, that no spousal support should be paid, and that ongoing child support obligations should be in accordance with the Federal Child Support Guidelines, SOR/97-175, to the Divorce Act, (the “Child Support Guidelines”).

C. ANALYSIS

1) The judgment sought to be varied pursuant to [section 17](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-3-2nd-supp/latest/rsc-1985-c-3-2nd-supp.html#sec17_smooth) of the [Divorce Act](https://www.canlii.org/en/ca/laws/stat/rsc-1985-c-3-2nd-supp/latest/rsc-1985-c-3-2nd-supp.html)

[30] I reiterate the threshold issue at this trial was Mr. Forbes income. The issue was whether or not the imputation of $100,000 per year in income by Campbell J. should stand or if some other method of calculation be used.

[31] For the reasons which follow, I find that Campbell J.'s order should not be interfered with. Even if I am wrong, I find that income in that same amount ought to be imputed to Mr. Forbes on the basis of persistent and chronic underemployment between 2004 when, according to Mr. Forbes, his company was no longer viable and the end of March 2016 when Mr. Forbes finally found employment. To be clear, Campbell J.'s order did not take effect until December 2009. The time frame before that is only relevant in that it gave Mr. Forbes five years to accept the fact that his career aspirations were unreasonable and to find employment.

[32] Mr. Forbes income tax returns were in evidence at the trial before Campbell J. His line 150 income was $13,000 in 2006 and “nil” in both 2007 and 2008.

[33] Mr. Forbes was operating a company called Juggernaut Studios Inc. (“Juggernaut”). There was minimal financial information available to Campbell J. regarding that corporation.

[34] At the original trial, Ms. Forbes testified as to Mr. Forbes’ post-separation lifestyle. It was her evidence that he dressed well, drove a nice car, and took regular vacations. There was also evidence in the first trial that Mr. Forbes had created a fictitious personality named “Julie Forbes”. He had created an e-mail account in that name and secured a credit card in that name. According to the evidence at the original trial, there was no such person as Julie Forbes. There was no evidence at this trial one way or the other regarding that issue.

[35] In preparation for the original trial, Ms. Forbes’ friend Bill Glasser prepared a document called “summary of individual month spreadsheets” for the 20 month time frame between November 2007 and July 2009. I reiterate the separation was in December 2007. That document was based upon Juggernaut’s corporate bank records. It was not clear how Ms. Forbes had come into possession of those records.

[36] At the original trial Kelly Summers gave evidence as to that spreadsheet. She is a CGA and a financial analyst with the provincial government. Ms. Summers confirmed that she had independently verified the information in the spreadsheet.

[37] Ms. Summers identified $101,000 in questionable transactions during that time frame. There were withdrawals of $27,000 in cash, $51,000 in checks containing no information as to their purpose, and $23,000 transactions noted as “personal”. These personal expenses included such things as haircuts, pharmacy expenditures, convenience store expenditures, Rona Building Center expenditures, and fitness club memberships. In addition, there appeared what was described as “a lot of restaurant entries.”

[38] Based upon that evidence, Ms. Forbes’ counsel requested that Campbell J. impute $100,000 in annual income to the applicant Mr. Forbes. Campbell J. agreed with that submission and did so.

2) The quality of the evidence at this trial

a) The evidence of Mr. Forbes

[39] “Probably the most valuable means of assessing the credibility of a crucial witness is to examine the consistency between what the witness said in the witness box and what the witness has said on other occasions, whether on oath or not.” See: R. v. M.G., 1994 CanLII 8733 (ON CA), at para. 27. There were occasions in this trial when Mr. Forbes gave a different version of a prior event than he had given on a previous occasion. As an example, Mr. Forbes was asked by me when he had moved into 410 North Street. As is discussed below, that was the home of Nicole Leach (“Ms. Leach”). Mr. Forbes and Ms. Leach were common-law spouses for a portion of the time between the date of separation and the date of trial. Mr. Forbes answered that very clear question by saying that he had moved in June of 2013. Mr. Forbes swore an affidavit May 7, 2015, wherein he maintained that he had begun residing with Ms. Leach in late 2011. Similarly, he swore a financial statement August 5, 2011, wherein he deposed that he then lived at 410 North Street, London. Mr. Forbes made some effort to explain that two-year discrepancy by explaining that although he was living at Ms. Leach's home most of the time in 2011, it was not until 2013 that the two considered themselves to be common-law spouses. Ms. Leach gave strikingly similar evidence. I, however, do not find that evidence to be of assistance to Mr. Forbes. The simple question asked was when he had moved into 410 North Street. The answer given at trial was different to the answer given to that question on previous occasions. The question of when Mr. Forbes began living at 410 North Street did not relate to a peripheral issue. Rather, it went directly to the issue of Mr. Forbes’ needs and means regarding his spousal support claim. Mr. Forbes had left the impression in examination-in-chief that during those two years he was essentially living hand to mouth. As will be discussed below, he was actually living quite well at Ms. Leach's home during that time frame. Other examples appear below.

[40] Mr. Forbes’ evidence was also from time to time inconsistent with other evidence heard at the trial that I believed. As an example, in examination-in-chief Mr. Forbes testified that his interest in the matrimonial home at 12 Phair Crescent had been transferred to Ms. Forbes only a year before the separation. The implication was that he had somehow been cheated out of his share of the house. Ms. Forbes testified that the house had never been in Mr. Forbes’ name. That was because of the fear of creditors. In support of that assertion, Ms. Forbes produced a copy of the abstract of title for their home which was consistent with her evidence. I believe that evidence and I did not believe Mr. Forbes. As another example, Mr. Forbes testified that his parents had loaned him and Ms. Forbes $27,000 as a down payment on their home. Mr. Forbes’ mother Louise Forbes (“Mrs. Forbes”) denied in cross-examination having given any gifts or loans to Mr. Forbes and Ms. Forbes during the time frame that they were living together. As is more fully discussed below, I had no reason to disbelieve Mrs. Forbes. Other examples appear below.

[41] Mr. Forbes also often gave evidence that was far-fetched, defied common sense, or was simply impossible. As an example, he stated in cross-examination that his 2009 tax return had not been prepared until May 28, 2014. When asked the reason for the delay it was his position that he could not file those income tax returns sooner because there was a “backlog in corporate records.” That was simply not true. The corporate tax return for the October 31, 2009 year-end was produced October 12, 2010. That date appears on the document in evidence. The 2011 tax return was not in evidence. However, the October 31, 2012 year-end return was prepared February 15, 2013. The five-year comparative summary attached to that tax return indicates that the 2011 return had in fact already been filed. As a result, at best I find Mr. Forbes would have had to wait until February 5, 2013 to file his personal returns if he was truly waiting for the corporate tax returns. That is inconsistent with the need for him to wait in excess of a further year to file his personal tax returns. Mr. Forbes was aware that those personal tax returns were required in this litigation and that his failure to produce them in a timely fashion was no doubt delaying the proceeding. Other examples appear below.

[42] As to the documentary evidence, I find that Mr. Forbes was well aware of the nature of the documentary evidence required for him to satisfy the onus of demonstrating that his income ought to be calculated in a manner other than that employed by Campbell J. I say that because, as said above, prior to the original trial there were several orders for production of documents. Mr. Forbes was aware of those orders. They appear in briefs filed by his lawyer. Many of the documents ordered to be produced in 2009 were not produced in this trial. Mr. Forbes had seven years to gather those documents and other documents relevant to his case.

[43] Said another way, in the time leading up to the original trial, Mr. Forbes consistently and persistently refused to provide meaningful financial disclosure. That was notwithstanding court orders in that regard. Ultimately, his pleadings were struck as a result of his refusal to meaningfully participate in the process. I find that Mr. Forbes was playing a sort of cat and mouse game with the courts, taunting the courts to catch him if they could. I find that Mr. Forbes’ strategy in this trial was for the most part unchanged. My reasons appear below.

b) The evidence of Natalie Julie Leach, Michael Johannes Hogewoning and Mrs. Louise Forbes

[44] I had no reason to disbelieve Mr. Forbes’ former common-law spouse Ms. Leach, his accountant Mr. Hogewoning and/or his mother Mrs. Forbes. In the evidence I heard from each, I did not detect any obvious internal inconsistencies or inconsistencies with the preponderance of evidence that I believed.

c) The evidence of Ms. Forbes

[45] The evidence of Ms. Forbes was less than perfect.

[46] As an example, she was a poor historian regarding tax issues. I found that she clearly lacked a meaningful understanding of tax related issues. Applicant’s counsel suggested that Ms. Forbes’ inability to answer taxation questions was indicative of an evasive witness. I disagree. Ms. Forbes testified that it was Mr. Forbes who had filed the tax returns for both of them during the currency of their marriage. After they separated Ms. Forbes had an accountant prepare her tax returns. I believed that evidence.

[47] Applicant’s counsel also suggested that Ms. Forbes had deliberately misstated her income in her financial statement sworn October 31, 2016. At paragraph 4 of that affidavit she states that her gross income from all sources was $80,879. I agree with applicant’s counsel; that information was not correct. The form is requesting Ms. Forbes line 150 income 2015, which was $94,726.13 in the prior year. Unfortunately, the form does not direct the reader to line 150 of her tax return. On the evidence before me, I find it obvious that the number employed by Ms. Forbes in her financial statement came from line 260 of the 2015 tax return where it says that her taxable income is $80,878.35. I have no difficulty believing Ms. Forbes simply misunderstood the question and rounded her line 260 income up to the nearest dollar. Further, her 2015 tax return was attached to that financial statement. In other words, she had nothing to gain by lying. The requisite information was all there.

[48] As a result, I approached any evidence that Ms. Forbes gave as to income tax issues with some caution from the standpoint of reliability. Accordingly, I undertook to verify for myself any relevant information in the tax returns filed. The frailty of that evidence however did not impact her credibility.

[49] There was also some suggestion that Ms. Forbes had misrepresented the date of separation as September 5, 2008 in her application. I reiterate there was consensus that the date of separation was December 18, 2007.

[50] Ms. Forbes explained the apparent contradiction.

[51] Ms. Forbes agreed that Mr. Forbes had not returned home after the domestic assault on December 18, 2007. He was subject to a bail condition related to the domestic assault and so he could not return to the home. It was, however, Ms. Forbes’ evidence that she and Mr. Forbes had engaged in counseling in an attempt to save the marriage. It was not until September 5, 2008 that the counseling had clearly failed and that she and Mr. Forbes had decided that there was no chance of reconciliation. I find that to be a reasonable explanation for that apparent contradiction.

[52] In the end, I had no reason to disbelieve Ms. Forbes. To the contrary, I found her evidence internally consistent as to matters of importance and consistent with the preponderance of evidence from other sources that I believed.

3) Custody and access

[53] The parties agree that a final order be entered at trial as to the issues of custody and access consistent with the order of Henderson J. dated May 13, 2016. The relevant portions of that order are recited below in my judgment. They were adapted from the language used by Henderson J. to reflect the fact that Matthew turned 18 years of age on August 3, 2016.

4) The Incomes of the Parties

a) Introduction

[54] After the parties were married, Mr. Forbes worked for a security firm known as London Protection International and then in marketing for a brief time. Mr. Forbes began operating Juggernaut as a partnership in 1999 using a small business loan as $7,500 start-up money. In 2000, Juggernaut was incorporated and Mr. Forbes was the sole shareholder. He operated that business from 1999 until October 2013 when it finally closed.

[55] It was Mr. Forbes’ evidence that the business did not make much money for the 14 years that it operated. He described 2002 as the high water mark for his business. As is discussed below, Mr. Forbes testified that there was a robbery in 2004. It was his evidence that the business never recovered from that robbery. In other words, the business was not viable after that time.

[56] The business had four primary sources of income.

[57] The first was described as “website hosting”. This is a monthly recurring source of revenue. He sold three packages ranging in price from $28.95-$89.95 per month. Mr. Forbes continues to operate this aspect of the business as of the date of trial.

[58] The second source of income was “web design”. He described this as designing websites for customers. According to Mr. Forbes, the website design work was done either by his employees, domestic contractors or offshore contractors. According to Mr. Forbes this represented the majority of his business. Mr. Forbes testified that his three to four offshore contractors had completed much of that work. One of the contractors was a previous employee of Juggernaut who worked as a web designer in Paris, France. Another was located in Waterbury, Connecticut and a third in Lima, Peru. It was on a trade mission to Lima, Peru that Mr. Forbes secured Barrick Gold as a client.

[59] Mr. Forbes also testified that he earned very little income from those offshore contractors. To be clear, there were no books of original entry or other documentation put into evidence, nor was there any evidence from any of these offshore operators from which I could ascertain the correctness of Mr. Forbes’ claims that he had earned very little income through those offshore operators. Further, I had no way to ascertain how much work they had actually done. I drew an adverse inference from that void of evidence.

[60] I concluded that this aspect of the business must have been quite lucrative. That is because Mr. Forbes would first obtain a quote from the contractor, then apply a mark-up, and then quote the marked-up amount to the customer. As a result, Mr. Forbes was guaranteed a markup whenever a job was taken. In other words, he could not possibly lose money on any job undertaken.

[61] The third source of income was described as “web-based software”. He produced this software for the banking industry, the insurance industry, and the mining and resources industry. Mr. Forbes’ list of customers included Xerox and, as said above, Barrick Gold.

[62] The fourth source of income was from Scientific Research and Experimental Development (“SRED”) claims. He described these claims as federal and provincial tax credits for online e-learning software development.

[63] Mr. Forbes maintained that Juggernaut had experienced bad luck which had negatively impacted its income earning ability.

[64] As an example, I reiterate that it was Mr. Forbes’ evidence that there had been a break-in or robbery and that all of the computer equipment had been stolen. Mr. Forbes did not have appropriate insurance coverage in that neither the building nor his premises were alarmed as the insurance policies required. To make matters worse, only approximately one half of the work on his computers had been backed up externally. I did find that odd given that the company was in the computer business. There were two consequences of the break-in. The first was that Juggernaut was forced to borrow $54,000 from Ms. Forbes parents. The loan was secured by way of 54,000 class “A” preference shares which provided for a rate of 7 percent per annum or $3,785 per year. Mr. Forbes indicated that Juggernaut had not always paid the interest. He also testified that it had never repaid any of the principal. The second consequence was that immediately after the break-in, approximately 35 percent of employees’ time was devoted to re-creating files that had not been backed up and therefore that time was not producing revenue.

[65] As a second example of Mr. Forbes bad luck, the company underwent a five-year audit. For reasons that were not explained, none of the audit documents were put into evidence, other than the examiner's statements of account. According to Mr. Forbes, the CRA did not take any issue with his reported income. He maintained that the only issue was as to employee withholdings. That issue was as a result of a CRA determination that some of the individuals working in Canada and treated by the corporation as contractors were actually employees. Mr. Forbes was personally liable for those withholdings along with the corporation because he was a director during the relevant time frame. The CRA successfully garnished Juggernaut’s bank accounts on several occasions, making it difficult for Mr. Forbes to operate the business. As is discussed below, there was no evidence to support Mr. Forbes’ contention that the audit included an income audit. The examiner’s statements of account dated August 25, 2011, September 3, 2011 and September 7, 2011 were all put to Mr. Forbes in examination-in-chief. According to Mr. Forbes, all of those adjustments to income relate to withholdings.

[66] According to Mr. Forbes, Juggernaut was closed at the end of September 2013.

[67] Between November 2013 and September 2015, Mr. Forbes earned his living through a partnership known as JVG Technologies (“JVG “). JVG was a residential solar panel distributor initially contracting with Easy Green and later with Ethos Solar. Mr. Forbes was at the time partners with Greg Bal and Vitali Rutkevich. Mr. Forbes’ partnership interest was originally 39 percent. Later, one of the partners left and Mr. Forbes became a 78 percent partner. According to Mr. Forbes, this business “did not pan out.” Of interest, at one point Mr. Forbes testified that he transferred his web hosting business from Juggernaut to JVG. Mr. Forbes entered an income statement and balance sheet for 2014 and 2015 purporting to be those of JVG. That web hosting business is not shown as an asset on the JVG balance sheet. At another point he testified that he had transferred that web hosting business directly from Juggernaut to a sole proprietorship in his name operating under the name “Teraspace”. That was the same name used by Juggernaut for that part of the business. In any event, a new bank account was opened for that business on December 15, 2015. There was no documentation of the transfer or sale of that name and that goodwill from Juggernaut to whomever it went. As a result, it was impossible for me to know which version of events was true.

[68] Mr. Forbes initially estimated that he personally earned approximately $180 per month in 2014 in 2015 from that web hosting business after he transferred those accounts to himself. That evidence morphed over time and is more fully considered below.

b) The Line 150 Incomes

[69] Justice Campbell found the respondent's income as a teacher to be $85,312 per year. At the time of trial, Ms. Forbes continued her employment as a teacher and her line 150 incomes adjusted for union dues are reflected below. Her income for 2016 is estimated.

[70] The incomes shown below for Juggernaut reflect the 2011 audit results.

[71] Mr. Forbes began working as an employee of Infotech on March 29, 2016. Mr. Forbes’ 2016 income is estimated on the basis that, according to his pay stub, in the seven months represented by that pay stub he had total earnings including bonuses of $48,067.26. I calculate that to be $6,866.75 per month during that time frame. That equates to $61,800.75 for the nine months which will pass between the date he commenced employment and the end of 2016. I find that also equates to $82,401 annually. Mr. Forbes testified that he continues to have income from his web hosting business. I reiterate there were no books of original entry, bank statements, or similar evidence from which I could make a meaningful calculation as to that income. I was only given Mr. Forbes bald assertions as to the performance of that business. Those assertions are more fully considered below.

Year	Applicant’s Income	Juggernaut’s net income	Respondent’s Income
2007	Nil	($5,131) loss
2008	Nil	$4,833	$73,221
2009	$6,547	$1,591	$78,864
2010	$6,464	($26,052) loss	$84,433
2011	$28,099	$16,284	$88,988
2012	$22,164	$8,162	$90,971
2013	$19,832	($13,305) loss	$91,481
2014	$7,222		$105,894
2015	($4659) business losses		$93,453
2016	$61,800.75 (estimate) (this does not include web hosting income)		$95,806 (estimate)

c) Conclusions as to Ms. Forbes’ income

[72] I can see no reason to assess the respondent’s income for support purposes as anything other than her line 150 income for 2009 to 2013, nor was one suggested by anyone at trial. Accordingly, I find her line 150 income an appropriate measure of income for support purposes for those years.

[73] As to 2014, Ms. Forbes’ line 150 income net of union dues was $105,894. In that year she withdrew $13,750 from an RRSP which is reflected in that line 150 income. She explained that because Mr. Forbes had unilaterally stopped making installments on the arrears of child support at the beginning of 2014, she was unable to make her payments as they came due. I find that including that RRSP withdrawal as income for child support purposes would yield an unfair result in these circumstances. It would encourage support payor's to avoid payment thereby forcing recipients to cash RRSPs, in turn thereby increasing income to the recipient and reducing or eliminating child support obligations of the payor. Accordingly, I find her appropriate income for purposes of child support to be $92,144 in 2014.

[74] In 2015 Ms. Forbes’ line 150 income net of union dues was $93,453. That income reflects a business loss of $1,267.28. I did not have the benefit of the financial statements for that business and, accordingly, have no way of ascertaining the reasonableness of that deduction. Accordingly, I would add it back. Ms. Forbes also made a withdrawal of $4,220.84 from her RRSP. Again, that was as a result of an inability to make ends meet because Mr. Forbes was not paying child support. For the reasons above, I find it inappropriate to include that amount in her income. As a result, I conclude that in 2015 Ms. Forbes’ income for support purposes ought to be $90,499.44.

d) Mr. Forbes’ income

[75] For the reasons which follow, I did not find it appropriate to interfere with Campbell J.'s imputation of income to Mr. Forbes in the amount of $100,000 per year.

[76] If I am wrong in that finding, and Mr. Forbes’ income was as reflected at line 150 of the relevant tax returns or some other minimal amount of income as was suggested by applicant’s counsel, then I would myself impute $100,000 per year in income to Mr. Forbes. That is because if Mr. Forbes truly had the minimal income he claims to have had, he would have been grossly underemployed from 2004 until the end of March 2016. I say that because, according to Mr. Forbes, the business was never productive after the 2004 robbery, and it was at the end of March 2016 when Mr. Forbes finally became productively employed. I reiterate that Mr. Forbes had from 2004 until Campbell J.'s order in 2009 to assess the viability of that company and react accordingly by seeking employment. He chose not to. Further reasons for this conclusion appear below.

e) The income imputed to Mr. Forbes by Campbell J.

i. Introduction

[77] Subsection 17(4) of the Divorce Act requires that before I vary a child support order, I must be satisfied that “a change of circumstances as provided for in the applicable guidelines has occurred since the making of the child support order or the last variation order made in respect of that order.” See: Power v. Power, 2015 NSSC 234, 364 N.S.R. (2d) 203, at para. 9. As said, the change in circumstances put forth by Mr. Forbes relates to his income.

[78] The thrust of the applicant's argument is that no income should be imputed during the relevant time frame and that his line 150 income should be accepted for purposes of child support. He argues that if income is to be imputed, it should be, at the most, $20,000-$30,000.

[79] There was some argument by applicant’s counsel that Templeton J.'s order intended to vary Campbell J.'s imputation of income and replace it with line 150 income. I find that such a variation would have required very clear language by Templeton J. She did not use any such language. Accordingly, I reject that argument.

ii. The applicable considerations

[80] Applicant's counsel suggests that the applicant may simply rely upon current line 150 income to refute Campbell J.'s finding.

[81] The thrust of Mr. Forbes’ argument was to the effect that Campbell J. was simply wrong in imputing income to him. Applicant’s counsel often denied that it was his goal to achieve that end but, notwithstanding those frequent denials, continued to ask Mr. Forbes questions to that end.

[82] It was Mr. Forbes’ evidence that in 2008 and 2009 Juggernaut was “bankrupt”. He maintained that the evidence before Campbell J. was “misleading”. To be clear, I did not take that to mean literally bankrupt but rather a figure of speech implying that the company was doing badly. I reiterate that 2009 was the very year that Campbell J. made his decision. To say that another way, Mr. Forbes was not suggesting something had changed since that time but rather that Campbell J. was simply wrong. I reiterate that Mr. Forbes himself said that nothing in Juggernaut's income had changed between 2009 and 2013.

[83] I disagree with Mr. Forbes’ suggestion.

[84] The appropriate starting point in my analysis is that the original order of Campbell J. is correct and that his finding that Mr. Forbes ought to have $100,000 in annual income imputed to him is correct. See: Wright v. Zaver, 2002 CanLII 41409 (ON CA), at para. 28; Southcott v. Southcott (1987), 1987 CanLII 8342 (ON SC), 10 R.F.L. (3d) 326 (Ont. Dist. Ct.), at para. 20; McMurchy v. McMurchy, 2002 BCCA 629, 33 R.F.L. (5th) 369, at para. 19.

[85] “When a court imputes income, that's a determination of a fact. It's not an estimate. It's not a guess. It's not a provisional order awaiting better disclosure, or further review. It's a determination that the court had to calculate a number, because it didn't feel it was appropriate to rely on - or wait for - representations from the payor.” See: Trang v. Trang, 2013 ONSC 1980, 29 R.F.L. (7th) 364, at para. 51; and Power v. Power, at para. 13.

[86] In cases where the support payor wishes to rely upon line 150 income rather than income that has been imputed, the onus is upon him or her to establish that there should be a change in the way their income is to be calculated. See: Trang v. Trang, at para. 55; and Power v. Power, at para 55; and Barichello v. Labute, 2016 ONCJ 546, at para. 52.

[87] In reaching a determination the court must consider:

a. Why did income have to be imputed in the first instance? Have those circumstances changed? Is it still appropriate or necessary to impute income to achieve a fair result?

b. How exactly did the court quantify the imputed income? What were the calculations, and are they still applicable?

See: Trang v. Trang, at para. 46; Barichello v. Labute, at para. 30; and Power v. Power, at para. 15.

iii. Did Mr. Forbes satisfy the onus upon him?

[88] For the reasons which follow, I find that Mr. Forbes has failed to satisfy the onus upon him to change the way in which his income is calculated between the date of separation and March 29, 2016, when he began his employment with Infotech.

[89] There are four overarching components underlying my reasons.

[90] The first is that in cross-examination, Mr. Forbes himself testified that nothing related to his income had changed between the December 4, 2009 order of Campbell J. and 2014. Without a change I have no jurisdiction to vary.

[91] The second is that the vast majority of the extensive examination-in-chief of Mr. Forbes was devoted to an attempt to demonstrate that according to his income tax returns, and those of Juggernaut, the income imputed by Campbell J. was wrong. I reiterate that I lack jurisdiction to revisit that issue. If the applicant disagreed with Campbell J.'s decision, he ought to have appealed.

[92] The third is that Campbell J.'s decision was based upon a lack of disclosure. As a result, it was impossible for Campbell J. to ascertain how much money Mr. Forbes had available to him. At this trial, again, very little of the evidence was devoted to that core issue of the money that was available to him. In other words, the financial disclosure at this trial did not meaningfully differ from the financial disclosure at the first trial.

[93] The fourth is that Mr. Forbes himself testified that Juggernaut was not viable after the 2004 robbery. Presuming that evidence to be correct, he continued operating that business both before Campbell J.'s order and in the four years between when that order was made in 2009 and 2013 when Juggernaut closed. Net income figures for Juggernaut were available for 2007-2013. I calculate the average net income reported throughout that six-year time frame equates to $-13,618. In other words, Mr. Forbes would have me believe that he continued in that same business year after year earning no income and with no hope of doing better in the future. I find it difficult to believe an individual as bright as Mr. Forbes seems to be would make such a poor decision for such an extended period of time. It is difficult to believe that he was not living on money taken from Juggernaut. The question is how much. I reiterate that there is no way of knowing given the lack of financial disclosure.

iv. Why did income have to be imputed in the first instance?

[94] I reiterate that it was necessary for the court to impute income in the first instance because of Mr. Forbes’ refusal to make appropriate financial disclosure.

v. Have the circumstances changed?

[95] At this trial, applicant’s counsel took the position that Mr. Forbes was now in “substantial compliance” with his disclosure obligations. It was his position that “anything needed to ascertain Mr. Forbes’ income” is before me. I reiterate that I disagree with that proposition.

[96] Justice Campbell’s reasons clearly invited Mr. Forbes to come back with better evidence. He said that Mr. Forbes could come back and prove that the imputation of $100,000 in annual income was incorrect. That scenario was eerily similar to that described at paragraph 24 of the decision in Gray v. Rizzi, 2016 ONCA 152, 129 O.R. (3d) 201.

[97] What Campbell J. and the trial judge in Gray v. Rizzi were doing was not inviting the payor to come back and recycle the same argument. The payors were being invited to come back with meaningful financial disclosure. In both cases the payors elected not to.

[98] Mr. Forbes was well aware that meaningful documentation is required in proceedings such as this. As said above, in July 2009, McGarry J. ordered monthly statements for all credit cards used by Mr. Forbes, monthly statements for all bank accounts over which he has signing authority, any loan or credit applications, and financial statements for Juggernaut. A similar order was made by Marshman J. on September 16, 2009. Mr. Forbes was clearly aware of these orders. They appeared in a brief filed by his counsel.

[99] As was the case in Trang, Mr. Forbes elected to present only partial evidence regarding Juggernaut’s finances at this trial. He did not file the appropriate documents or make the appropriate disclosures. See: Trang, at para. 64. That was notwithstanding multiple orders requiring him to do so. As a result, Mr. Forbes has insulated himself and his company from serious scrutiny. Mr. Forbes may have been unaware of the potential for imputation of income on the first occasion, but after income had been imputed the first time, he had to have known that the court will do so where necessary. As observed by Pazaratz J. at para. 67 of his decision in Trang, Mr. Forbes should not be allowed to benefit from his delay and manipulation of the evidence. He has now closed down his business and moved on.

[100] Mr. Forbes did provide personal and corporate tax returns for many of the years in question. That said, the financial disclosure provided in this trial can only be described as a mishmash of information for only some of the relevant years. The law is settled that “negative inferences are drawn where there is a lack of disclosure and a lack of relevant evidence before the court”. See: Jenkins v. Jenkins, 2012 NSSC 117, at para. 25.

[101] The following are some observations as to the inadequacy of Mr. Forbes’ financial disclosure.

[102] As an example, for the 2006 year end there is what purports to be a profit and loss statement but no balance sheet or income tax return. That profit and loss statement discloses net corporate income of $6,044.42 for 2006. Of interest, that profit and loss statement was produced January 20, 2010, which was well after the 2006 year-end tax return had been submitted to the CRA. I asked Mr. Forbes for an explanation of that date. His first explanation was that the profit and loss statement entered into evidence was not necessarily the same as the one given to the CRA. Upon reflection, Mr. Forbes suggested that January 20, 2010 may be the print date of a document that had been prepared years earlier. I find Mr. Forbes’ first explanation to be correct. That is that the profit and loss statement produced for the court could not be the same as the one that had been produced to the CRA. I say that because in the five-year comparative summary attached to the corporate tax return for the October 31, 2009 year-end, the CRA records the corporation’s net income as $25,456 and taxable income as $19,311 for the 2006 taxation year. In examination-in-chief, the 2006 income set out in that five-year comparative summary was put to Mr. Forbes. In other words, he had an opportunity to explain the discrepancy between the CRA records and the profit and loss statement filed in this trial. He did not do so. This conduct is important for two reasons. The first is that it directly and negatively impacted Mr. Forbes’ credibility. The second is that it is an example of the offensive conduct observed by Campbell J., which had resulted in his decision to impute income to Mr. Forbes. It is strong evidence that nothing has changed since that trial.

[103] As a second example, there were only profit and loss statements for the 2007, 2008, 2009, 2010, and 2011 year ends. There was no explanation as to why the others had not been put into evidence.

[104] As a third example, there were balance sheets for only 2010 and 2011. There was no explanation as to why the other balance sheets had not been put into evidence. Further, the balance sheets in evidence claimed a GST receivable asset of $41,008.77. Mr. Forbes was unable to explain that asset. I make two observations regarding that entry. I do not believe that Mr. Forbes could forget a $41,008.77 asset if his financial circumstances were as claimed. Given the lack of explanation, I find that the balance sheets were incorrect in that regard. It follows that the reliability of the financial statements was negatively impacted.

[105] As a fourth example, there were no general ledgers produced. Mr. Forbes acknowledged that fact. Applicant’s counsel suggested that the reason for the failure to produce was that respondent’s counsel had never asked for those records. I make two observations regarding those records. The first is that those records are clearly necessary to establish how much money was available to Mr. Forbes each year during the relevant time frame. The second is that because this is a variation proceeding, the onus is on Mr. Forbes and not the respondent. When Mr. Forbes made the decision to withhold those records from these proceedings he did so at his own peril.

[106] As a fifth example, there were only photocopies of bank statements for the July 14, 2009 to April 2011 time frame. There was no explanation as to why all of the corporation's bank records from its two bankers were not put into evidence. There was no notice of intention to enter the statements that were produced as business records pursuant to s. 35(2) of the Evidence Act, R.S.O. 1990, c. E.23. Respondent’s counsel kindly agreed to waive the lack of notice and so they were considered by me.

[107] As a sixth example, Mr. Forbes asked the accounting firm Collins Barrow to prepare a statement regarding his transactions with Juggernaut. That was presumably in an effort to explain the personal expenditures referred to by Kelly Summers in the original trial. The evidentiary value of that letter is almost nil for many reasons.

[108] The first is that the apparent primary benefit of that letter relates to the opinions offered. I initially allowed the evidence in on the basis that I understood from applicant’s counsel the evidence may serve some other purpose. In the end, it did not. The law is well settled that opinion evidence is presumptively inadmissible. There is an exception for expert testimony and reports. There was no attempt to qualify the author of the letter as an expert or to enter the letter into evidence as an expert report.

[109] The second is that the evidence was not tested by cross-examination.

[110] The third is the limitations resulting from the notices contained within the letter. There are two. The first reads as follows:

We have not audited, reviewed or otherwise attempted to verify the accuracy of the aforementioned financial information provided to us and, accordingly, we express no assurance there on. In addition, we cannot comment on any transactions that are not reflected in the accounting records or that may be in other accounts. We have been asked to comment on certain select aspects of the financial information. We are able to provide the following comments.

[111] The second notice relates specifically to funds loaned by Mr. Forbes to Juggernaut. It reads as follows:

We have not verified the source of the funds loaned the Juggernaut, as detailed above. The descriptions are the descriptions per the General Ledger Details that you provided us.

[112] In other words, Collins Barrow had limited access to Juggernaut's accounting records. Importantly, it appears that Collins Barrow was not given access to the bank records examined by Kelly Summers which revealed $101,000 in what appears to be personal withdrawals between November 2007 and July 2009. Nor did they appear to have any access to the information underlying the personal tax returns that had been submitted to them. Their opinion was based upon the information provided by Mr. Forbes to the accountants. As an example, it was not the general ledgers but rather only general ledger “details” that were provided to Collins Barrow by Mr. Forbes.

[113] If the applicant wished to rely upon that evidence, the author of the letter ought to have been summoned as a witness and been exposed to cross-examination.

[114] As a seventh example of the inadequacy of the applicant’s evidence, I reiterate that as of the date of trial, Mr. Forbes continues to operate his web hosting business. I was left with the impression at one point in the trial that the net income as of the date of trial is $140 a month. At another point in the trial I heard that the income was now $202.65 per month with expenses of approximately $192 a month. In other words, Mr. Forbes would have me believe that the business is either losing $52 per month (if the $140 per month estimate is correct) or earning about $10.65 a month (if the $202.65 estimate is correct). I make two observations regarding those assertions. The first is I do not believe Mr. Forbes would continue with a business which either loses money every month or only earns only $10.65 a month. It defies common sense. The second is that, as said above, there were no financial statements relating to that business, nor were there documents relating to the transfer of that asset from Juggernaut to Mr. Forbes personally. In other words, there was again a vacuum of financial disclosure in that regard.

[115] As an eighth example, there were very few personal and corporate bank records put into evidence. As a result there was no way of ascertaining the likelihood of Mr. Forbes having cash or assets in the names of others. Nor was there any way to assess Mr. Forbes’ lifestyle in any way differently than had been done by Campbell J. I reiterate the onus was upon Mr. Forbes to establish that there should be a change in the way his income is calculated.

[116] Finally, the applicant chose to call his friend Michael Hogewoning, who prepared many of Mr. Forbes personal tax returns and many of the tax returns for Juggernaut. Notwithstanding that I had no reason to disbelieve Mr. Hogewoning, his evidence was of little assistance as to the amount of money available to Mr. Forbes during the relevant time frame. I say that because Mr. Hogewoning simply prepared the tax returns based on information provided by Mr. Forbes and/or the bookkeeper. The books of original entry or evidence of the bookkeeper would have been much more helpful to the applicant. It seems to me appropriate to draw an adverse inference from Mr. Forbes failure to call the bookkeeper. See for example: Stetler v. Stetler, 2013 ONCA 508, at para. 7; and Duffy v. Duffy, 2009 NLCA 48, 289 Nfld. P.E.I.R. 132, at para. 29; and Mizzau v. Barnes, 2006 CanLII 21596 (ON SC), at para. 22.

[117] For all of these reasons, I find that the financial disclosure available at this trial did not differ in a meaningful way from that available to Campbell J.

vi. Is it still appropriate or necessary to impute income to achieve a fair result?

[118] I find that it is appropriate to continue to impute income after Mr. Forbes began his employment with Infotech at the end of March 2016. My reasons appear below under the heading “the appropriate amount of income to be imputed” and “imputation of income after the end of March 2016”.

vii. How did the court quantify imputed income? What were the calculations? And are they still applicable?

[119] I reiterate that Campbell J. was presented evidence of lifestyle and evidence of significant personal expenses that had been paid from the corporate bank account. That evidence was central to his imputation of income. Campbell J. was aware of and had seen Mr. Forbes’ personal 2006, 2007, and 2008 income tax returns when he made that decision. I reiterate that Campbell J. concluded that the line 150 income was an inappropriate measure of income for purposes of child support in the circumstances.

[120] I find the quantification of income by Campbell J. remains applicable up until the end of March 2016 when Mr. Forbes obtained employment. The following are my reasons for coming to that conclusion.

[121] I begin with the observation that both Marshman J. and Campbell J. found it appropriate to impute income to Mr. Forbes. After trial, Campbell J. imputed income of $100,000 to Mr. Forbes on a final basis. In other words, neither believed that Mr. Forbes did not have any income nor did they believe that his line 150 income was a valid indicator of income for support purposes.

[122] Consistent with their findings, I conclude that it defies common sense to believe that since Campbell J. made his order Mr. Forbes could have continued to live for several years without any income whatsoever. It also defies common sense that he would have continued devoting time and effort to a business that was not producing any income.

[123] As a result, the question that I am left with is how much income did that business produce? In other words, are the methods of quantification of imputed income and calculations employed by Campbell J. still applicable?

[124] I reiterate that at this trial corporate bank statements were provided for July 14, 2009 - April 14, 2011. Those bank statements tend to support the conclusions of Kelly Summers regarding the corporate bank records. I reiterate that she testified in the original trial. There, Kelly Summers concluded that Mr. Forbes had been taking far more money out of the Corporation than his line 150 income reflected.

[125] I performed a calculation similar to Kelly Summers’ based upon the June 14, 2010 to July 14, 2010 business account bank statement. I included such things as checks payable to Mr. Forbes, cash, ATM withdrawals, LCBO purchases, pharmacy purchases, life insurance purchases, grocery store purchases, restaurant purchases, and auto related purchases. In that month Mr. Forbes received the benefit of at least $4,379.52. That represented only one of the 12 months in 2010. That year Mr. Forbes line 150 income was only $6,464. It follows that his personal expenditures were indicative of lifestyle that significantly exceeded his line 150 income.

[126] I would add that Mr. Forbes was well aware that those expenses were in issue at trial. He maintained that the meals have all been business expenses. In support of that proposition he said that there was a “docket system” to keep track of which client card to chargeback for those meals. Again, Mr. Forbes elected to withhold that “docket system” from this trial. Again, nothing had changed since the trial conducted by Campbell J.

[127] While it would be impossible for me to calculate Mr. Forbes income on the available information, I am left with no doubt that Mr. Forbes was taking far more out of the company to live on than his line 150 income would indicate.

[128] I find that Mr. Forbes has failed to meet the onus upon him to establish a material change as to his income while self-employed. I also find that the evidence relied upon by Campbell J. remained applicable from the date of the original trial, which was December 4, 2009, until March 31, 2016, which was when Mr. Forbes began his current employment. The time frame subsequent to Mr. Forbes beginning his employment with Infotech is considered below.

[129] Prior to leaving this issue I feel compelled to comment on the CRA income tax audit (as opposed to the voluntary SRED audits). There was some suggestion by Mr. Forbes that the 2011 audit was not simply an audit related to withholdings, but rather an audit of the entire operation. I reiterate that the examiner’s statements of account dated August 25, 2011, September 3, 2011 and September 7, 2011, were all put to Mr. Forbes in examination-in-chief. According to Mr. Forbes, all of those findings relate to withholdings. There was no other evidence provided in support of the bald assertion that the audit had been a comprehensive audit of the corporation. Given my findings as to Mr. Forbes credibility, I did not accept his evidence that it was.

[130] For all of these reasons, I conclude that in order to achieve a fair result, it is appropriate to maintain the level of income imputed by Campbell J. throughout the time frame between December 4, 2009 and March 31, 2016.

f) Findings as to Mr. Forbes’ underemployment and the resulting imputation of income between December 2009 and the end of March 2016.

i. Introduction

[131] As said above, even if I had found that circumstances had changed and that, as a result, Campbell J.'s conclusions were no longer appropriate, I would have imputed $100,000 in annual income to Mr. Forbes in any event.

ii. Mr. Forbes’ underemployment

[132] I begin with the applicant's counsel's proposition that Mr. Forbes “should not be penalized for trying to follow a dream.” In other words, applicant’s counsel would have me find that Mr. Forbes was at liberty to pursue his dreams related to Juggernaut between the date of separation and the end of March 2016 when he finally got a job. That was notwithstanding Mr. Forbes’ own evidence that the company never recovered after the 2004 robbery. That was also notwithstanding Mr. Forbes’ acknowledgment of his obligation to support his children. The logical conclusion of that argument is that Mr. Forbes’ personal dreams take priority over his obligations to his children as a parent.

[133] I can think of no support for that proposition in law.

[134] Mr. Forbes, like every parent, has an obligation to do whatever is reasonably possible in the circumstances to provide for his children.

[135] Section 19(1)(a) of the Federal Child Support Guidelines to the Divorce Act provides that the court may impute such amount of income as the court considers appropriate in circumstances where a support payor is intentionally underemployed. “A parent is intentionally underemployed within the meaning of this section if they earn less than they are capable of earning having regard for all of the circumstances.” See: Daniel-DeFreitas v. Francis, 2012 ONSC 515, para. 57; Drygala v. Pauli, 2002 CanLII 41868 (ON CA); Lawson v. Lawson, 2006 CanLII 26573 (ON CA). Contrary to the applicant’s assertion, generally speaking, “a spouse is not to be excused from his or her child support obligations in furtherance of unrealistic or unproductive career aspirations.” See: Duffy v. Duffy, at para. 26; and Mizzau v. Barnes, at para. 22.

[136] In this case, given Mr. Forbes’ evidence that the business was not viable after 2004 and given the position that he had a right to “pursue his dream”, I find that he was intentionally underemployed.

[137] Once that finding is made, the burden shifts to Mr. Forbes to establish the reasonableness of his decision to be intentionally underemployed. See: Duffy v. Duffy, at para. 26; and Mizzau v. Barnes, at para. 22.

[138] At para. 58 of the decision in Daniel-DeFreitas v. Francis, Chapel J. sets out a list of relevant considerations in determining a party's capacity to earn income. Those which I find are important in this case are as follows:

a. There is a duty on the part of the payor to actively seek out reasonable employment opportunities that will maximize their income potential so as to meet the needs of their children.

b. The court will not excuse a party from their child support obligations or reduce these obligations where the party has persisted in un-remunerative employment, or where they have pursued unrealistic or unproductive career aspirations.

c. A self-induced reduction of income is not a basis upon which to avoid or reduce child support payments.

d. Underemployment must be measured against what is reasonable to expect of the payor having regard for their background, education, training and experience.

e. If a party chooses to pursue self-employment, the court will examine whether this choice was a reasonable one in all of the circumstances, and may impute an income if it determines that the decision was not appropriate having regard for the parent's child support obligations.

h. Where a party fails to provide full financial disclosure relating to their income, the court is entitled to draw an adverse inference and to impute income to them.

i. The amount of income that the court imputes to a parent is a matter of discretion. The only limitation on the discretion of the court in this regard is that there must be some basis in the evidence for the amount that the court has chosen to impute.

[139] In applying these principles to the facts of this case, I make the following findings.

[140] The first is that Mr. Forbes did not satisfy his obligation to actively seek out reasonable employment opportunities that would maximize his income potential. I say that because Mr. Forbes was asked quite bluntly by respondent’s counsel if he was aware that he could not possibly feed his children on the income that he maintains Juggernaut was earning between 2009 and 2014. Mr. Forbes candidly admitted that he was aware of that fact. In other words, Mr. Forbes was aware that he was not fulfilling his obligation to feed his children. It was his evidence that he had been waiting for the business to turn around since the 2004 robbery. Taking Mr. Forbes’ evidence at its best, and presuming the tax returns to be correct, it seems to me it would take any reasonable individual far less than 10 years to realize the business was going nowhere.

[141] Mr. Forbes suggested that he had applied for jobs during that time frame. When cross-examination commenced after the morning break, applicant’s counsel gave Mr. Forbes a package of job applications to identify. The purpose of that evidence was to confirm that Mr. Forbes had been looking for work. The earliest application I could find was December 31, 2015. Mr. Forbes suggested that he had sent out letters requesting employment but had not kept records of those letters. Given my findings as to his credibility, I simply did not believe that. Accordingly, I conclude that Mr. Forbes made no meaningful effort to apply for a job until December 31, 2015.

[142] I do not find it any coincidence that the first job application in evidence had been made very shortly after Ms. Leach had asked Mr. Forbes to leave her home because of the financial stress imposed by Mr. Forbes. Mr. Forbes had lived quite comfortably with Ms. Leach from a short while after separation until then. The amenities provided to Mr. Forbes by Ms. Leach are more fully considered below under the spousal support heading. I conclude that it was not until Mr. Forbes was aware that he would be losing the benefit of the lifestyle provided by Ms. Leach that he was finally induced to make a meaningful attempt to find productive employment.

[143] The second finding is there was nothing at trial to support the contention that Mr. Forbes should be excused from his support obligations given his persistence and unproductive career aspirations.

[144] The third finding is that Mr. Forbes demonstrated significant income earning skills. Less than three months had passed between the date of Mr. Forbes first application and the day he started work at Infotech. In other words, once Mr. Forbes put his mind to it, he was able to land a very well-paying job in very short order. As said, I calculate that that job pays $82,285.71 per year including bonuses.

[145] The fourth finding is that Mr. Forbes choice to pursue self-employment, which according to Mr. Forbes’ own evidence was un-remunerative since at least 2004, was an unreasonable choice. There was no evidence to suggest otherwise.

[146] For all of these reasons, I have no difficulty concluding that Mr. Forbes was capable of earning significantly more income between December 2009 when Campbell J. made his order, and the end of March 2016 when he began working at Infotech.

iii. The appropriate quantum of income I would have imputed between December 2009 to the end of March 2016, had I found it appropriate to do so

[147] As to quantum, I find $100,000 per annum appropriate. There are three components in my calculation of that amount.

[148] The first is that, as said above, I find the Infotech job pays $82,285.71 per year including bonuses. This is a good indication of what Mr. Forbes could have been earning had he chosen to pursue such employment during the relevant time frame.

[149] The second is that in addition to that income Mr. Forbes continues to operate his web hosting business. For the reasons above, I simply do not believe that business does not earn any income. There was no evidence that Mr. Forbes was paying tax on that income. It follows that income would have to be grossed up and added to Mr. Forbes Infotech income. There was very little evidence from which I can estimate that income given Mr. Forbes’ lack of disclosure. There was no current information whatsoever. Using the personal expenditures from the Juggernaut June 14, 2010 to July 14, 2010 bank statement as an indicator of lifestyle, I estimate that income to be approximately $15,000 to $20,000 per year. In coming to that conclusion, I have also considered that the web hosting business was not Juggernaut's primary source of income in 2010 which tended to put significant downward pressure on my estimate. Further, Mr. Forbes now has no overhead for things such as rent and employees. That tended to put upward pressure on that estimate.

[150] The third is that Mr. Forbes has received generous gifts from his mother over time. Gifts which are likely to recur over time are a proper and necessary consideration in the imputation of income. See: Korman v. Korman, 2015 ONCA 578, 126 O.R. (3d) 561, at para. 62. According to Mr. Forbes’ calculation, the total gifts from his mother now exceed $35,000. Mrs. Forbes continues to generously support her son albeit likely at a slower rate than previously. Mrs. Forbes testified that she gave money to her son for rent and anything else that he needed. She recently co-signed on his lease. He is $4,500 in arrears on that lease and likely to soon be evicted if he does not make good on those arrears. It follows that his mother will no doubt wind up paying that $4,500 on Mr. Forbes’ behalf either in an effort to bring the lease into good standing or as a result of court action if the lease is terminated. Mrs. Forbes testified that she is able and willing to assist her son in the future. Similarly, she is assisting financially with Mr. Forbes’ children. She gives them money as they need it. As an example, she assisted with Matthew’s schooling with the gift of $600 towards his dormitory expenses and a further $100 per month in spending money. She also pays for Matthew's cell phone.

g) Imputation of income after the end of March 2016

[151] For the same reasons, I impute $100,000 in annual income to Mr. Forbes from the end of March 2016 to the date of trial for purposes of child support arrears, ongoing child support, and the analysis of his request for spousal support.

h) Conclusions as to Mr. Forbes’ income

[152] In conclusion, I find that Mr. Forbes failed to demonstrate on a balance of probabilities that there should be a change in the way that Campbell J. calculated his income. Accordingly, I do not find it appropriate to interfere with that order in the time frame up to and including the end of March 2016.

[153] Even if I am wrong and Mr. Forbes’ income is correctly reflected in line 150 of each of his tax returns throughout the relevant time frame, for the reasons above I would impute income of $100,000 per year. That is because if that line 150 income is a correct reflection of his income, Mr. Forbes was clearly underemployed during the relevant time frame.

[154] Finally, I would impute income of $100,000 per year to Mr. Forbes after the end of March 2016 when he began working at Infotech.

[155] As a result, I find the incomes of the parties during the relevant time frame to be as follows.

Year	Applicant’s Income	Respondent’s Income
2009	$100,000	$78,864
2010	$100,000	$84,433
2011	$100,000	$88,988
2012	$100,000	$90,971
2013	$100,000	$91,481
2014	$100,000	$92,144
2015	$100,000	$90,499.44
2016	$100,000	$95,806 (estimate)

i) Child Support Arrears

[156] In order to calculate child support arrears, I will begin by calculating what Mr. Forbes ought to have paid, and then calculate and subtract what he actually paid.

a) How much child support should Mr. Forbes have paid up to and including October 31, 2016?

i. The arrears as at February 4, 2010

[157] There was consensus that a total of nine costs orders had been made against Mr. Forbes. There was also consensus that of those, seven had been paid as of the date of trial.

[158] The two costs orders which remained outstanding at this trial are Campbell J.'s costs order at the first trial in the amount of $10,000 plus HST, which I calculated to total $11,300, and Templeton J.'s costs order of September 14, 2011 in the amount of $3,500 plus disbursements of $195.75 plus HST, which I calculated to total $4,176.20.

[159] There was consensus that the February 4, 2010 debit in the amount of $35,668 recorded in the FRO calculation of arrears includes the costs ordered by Campbell J. That amount also included three costs orders considered at page 7 of the transcript of proceedings at summary trial totaling $1,750.

[160] It follows that immediately prior to the payment of $1,750 recorded in the FRO statement on February 4, 2010, Mr. Forbes owed $35,668 in child support arrears including everything but the $4,176.20 costs ordered by Templeton J. I say that because I could see no corresponding debit in the FRO account for those costs nor was one suggested.

[161] As a result, I conclude that as February 4, 2010, the total arrears of child support and costs stood at $39,844.20 immediately prior to the payment of $1,750 that day.

ii. February 4, 2010 to November 1, 2013 time frame

[162] As said above, during this time frame both Matthew and William lived with the respondent mother.

[163] Given my findings as to income, Mr. Forbes ought to have been paying child support in accordance with the order of Campbell J. That is $1,404 per month for 45 months, or $63,180.

iii. The November 1, 2013 to December 15, 2015 time frame

[164] During this time frame Matthew lived with his father and William with his mother.

[165] Section 9 Child Support Guidelines provides that in cases such as this where each party has custody of one of two children, the amount of child support is the difference between the amounts that each person would otherwise pay if a child support order were sought against each of them.

[166] Based upon child support for one child and Mr. Forbes annual income of $100,000, I find the table amount of child support is $880 per month for the 25.5 months within that time frame, or $22,440.

[167] In 2013 Ms. Forbes had annual income of $91,481. I find the appropriate child support $812 per month. For those two months she ought to have paid a total of $1,624.

[168] In 2014 when Ms. Forbes earned $92,144 I find the appropriate child support to be $818 per month. For those 12 months she ought to have paid $9,816.

[169] In 2015 she earned $90,499.44. The appropriate child support is $805 per month. It follows that in those 11.5 months, she ought to have paid $9,257.50.

[170] In summary, throughout that time frame Mr. Forbes ought to have paid $22,440 and Ms. Forbes to have paid $20,697.50. It follows that the set off amount payable by Mr. Forbes is $1,742.50.

iv. The December 15, 2015 to April 12, 2016 time frame

[171] During this time frame both Matthew and William again lived with their mother.

[172] Based upon child support for two children and Mr. Forbes’ annual imputed income of $100,000 and Campbell J.'s order for $1,404 a month in child support, I find that Mr. Forbes ought to have paid a total of $5,616 in that four-month time frame.

v. The April 12, 2016 to November 1, 2016

[173] During this time frame Matthew again lived with his father and William with his mother.

[174] Matthew turned 18 August 3, 2016. I find it appropriate to treat the child support before Matthew's 18th birthday different from the child support after that birthday.

[175] For the 3.5 months which passed between April 12 and Matthew's 18th birthday, I find it appropriate to award the set off amount. That is for the reasons above. Based upon Mr. Forbes’ income of $100,000 he ought to have paid $880 per month, or $3,080 for those 3.5 months. Based upon Ms. Forbes estimated income of $95,806 she ought to have paid $846 per month, or $2,961 for those 3.5 months. It follows that the set off payable by Mr. Forbes is $119.

[176] As to the time frame subsequent to Matthews 18th birthday, s. 3(2)(b) of the Child Support Guidelines provides that when a child is over 18 years of age the court does not have to award Guideline child support if it does not consider it appropriate. Rather, the court can award an amount which it considers appropriate having regard to the condition, means, needs and other circumstances of the child and the financial ability of each spouse to contribute to child support.

[177] In this case, I do not find it appropriate to award Ms. Forbes any set off child support. I am keenly aware that the financial situation in which Mr. Forbes finds himself is of his own doing. That said, an overly burdensome order will negatively impact Mr. Forbes’ ability to care for Matthew. In other words, it would be Matthew who would suffer for his father's financial folly if I were to award the set off child support. That observation must obviously be balanced against Ms. Forbes less than optimal financial situation. As said above, Ms. Forbes financial situation is a product of Mr. Forbes conduct.

vi. Total child support Mr. Forbes ought to have paid

[178] Adding the totals from each of the above time frames, I calculate Mr. Forbes ought to have paid $110,501.70 in child support and costs between February 4, 2010 and October 31, 2016

b) How much child support did Mr. Forbes pay from February 4, 2010 up to and including October 31, 2016

[179] There was consensus that the payments recorded by FRO were all of the payments made through that organization and that all of the payments made through that organization had been received by the respondent. In 2010, between February 4 and the end of the year, Mr. Forbes paid $10,600. Mr. Forbes paid $5,800 in 2011, $9,600 in 2012, $8,000 in 2013, he paid nothing in 2014 and 2015, and he paid $16,756.22 in 2016. I calculate that to be a total of $50,756.22 paid by Mr. Forbes during the relevant time frame.

[180] I would add several credits to that total. A May 7, 2010 letter from respondent’s counsel to applicant’s counsel delineates several payments made by Mr. Forbes which do not appear in the FRO statement. In the first box there is an acknowledgment of $80 on September 14, 2009 and $200 on January 15, 2009. The June 11, 2008 payment of $450 predates the starting point of the calculation and, accordingly, does not apply. There are 11 further payments of $200 recorded. There was consensus that the resulting credit would be $2,480.

[181] Accordingly, I find the total payments made toward child support and costs between February 4, 2010 and October 31, 2016 to be $53,236.22.

c) Total arrears of child support

[182] Subtracting the $53,236.22 in payments that were actually made from the $110,501.70 in payments that Mr. Forbes ought to have made, I find that as of October 31, 2016, the total arrears in child support and costs outstanding equal $57,265.48.

j) Payment of the arrears

[183] According to Mr. Forbes’ November 4, 2016 pay stub, he is being garnished $1,139.41 in each of his bi-weekly pay periods. I calculate that to be $2,468.72 per month.

[184] Mr. Forbes maintains that he has difficulty making ends meet as a result. He also maintains that Matthew suffers as a result. Ms. Forbes does not dispute that assertion.

[185] According to that same pay stub, the net income available to Mr. Forbes without garnishment is $2,231.69 per pay period. I calculate that to be $4,835.32 per month.

[186] According to Mr. Forbes’ financial statements, his monthly expenses include $1500 for rent, $190 for cell phone and internet, $475 for household expenses, $257.50 for transportation, $15 for health expenses, $190 for personal expenses, and $689.32 for other expenses. I calculate that totals $3,316.82. I find all of the expenses claimed reasonable with the exception of $429.32 for client related expenses. Although those expenses are incurred, they are reimbursed. It follows that Mr. Forbes need only set that money aside once and replenish that fund each month as he is reimbursed. Accordingly, I accept that Mr. Forbes has legitimate expenses of $2,887.50 per month. To that I would add 1/12 of Mr. Forbes annual $5000 contribution to Matt's education which is more fully discussed below, or $416.66 a month. That brings Mr. Forbes’ total expenses to $3,304.16 per month.

[187] As a result, I find the difference between Mr. Forbes’ net income and his reasonable expenses to be $4,835.32 less $3,304.16, or $1,531.16 per month. That is the amount that is available to Mr. Forbes to pay his child support arrears, and for unexpected expenses.

[188] In balancing the needs of the parties and the children and the impact of any order for payment upon each of them, I find it would be appropriate for Mr. Forbes to repay the arrears at $1,000 per month. That will leave him with a little over $500 per month for unexpected expenses.

k) Ongoing child support from November 1, 2016 and after

[189] For the reasons above, based on Mr. Forbes’ imputed annual income of $100,000 and Ms. Forbes’ estimated annual income of $95,806, I do not find it appropriate that either pay child support, notwithstanding a straight set off calculation would result in Mr. Forbes having to pay child support.

l) Section 7 expenses

a) Retroactive section 7 expenses

[190] Mr. Forbes testified that he had paid approximately $2,690.97 in section 7 expenses since the date of separation. Most of those have been paid since Matthew began to live with him. Ms. Forbes on the other hand provided evidence of payment of $33,702.91 on behalf of the children. She candidly acknowledged that some of those expenses may not qualify for the definition of extraordinary or special.

[191] Ms. Forbes is, however, not seeking any retroactive section 7 expenses. I can see no reason to award Mr. Forbes any retroactive section 7 expenses given that the overwhelming share of the expenses incurred on behalf of the children have been paid by Ms. Forbes.

b) Ongoing section 7 expenses

[192] Given the similar incomes of the parties, the split custody arrangement, the inability of the parties to communicate, and Mr. Forbes’ history of nonpayment, it seems to me that any arrangement involving exchanges of money for section 7 expenses will only increase the level of conflict between these individuals. Accordingly, I find it appropriate for each to pay the expenses related to the child in their care.

[193] I, however, find it appropriate to make an exception for post-secondary education expenses, simply because of the amount of those expenses.

[194] William is currently not enrolled in a post-secondary institution.

[195] Matthew’s post-secondary education expenses are as follows:

• Tuition $6,700
• Residency fee $4,300
• Meal plan(est. $3,700-$4,200) $3,950
• TOTAL $14,950

[196] Matthew clearly has income earning ability. According to the OSAP loan documents Matthew will have earned income of $2,800 during the summer of 2016 and the current academic year. In 2015 Matthew worked for his father. Mr. Forbes testified that Matthew had earned approximately $2,000 that summer.

[197] According to Ms. Forbes, Matthew also qualified for $15,000 in OSAP assistance for this academic year. Notwithstanding the availability of that money, it seems to me that if Matthew finances his entire education through OSAP, the resulting debt will be staggering. It also seems to me that in this situation there should be some assistance from the applicant and the respondent.

[198] I find that a division of those post-secondary expenses where Matthew, the applicant, and the respondent each pay one third is appropriate in this situation. That works out to $5,000 each.

[199] Given Mr. Forbes’ lengthy and persistent history of not paying what he owes, I am reluctant to trust him with Matthew’s money. As a result, I find it appropriate that Ms. Forbes pay her share directly to Matthew. I also find it appropriate that the payments of each of the parties be made in installments of $2,500 twice a year, but not until enrollment has been confirmed in writing for each term.

m) Spousal Support

a) Is an award of spousal support appropriate in the circumstances and, if so, how much?

i. Introduction

[200] Mr. Forbes seeks an award for retroactive and/or ongoing spousal support. I am aware that Mr. Forbes’ request comes late. There is, however, no limitation period on an application for spousal support. See for example: Quackenbush v. Quackenbush, 2013 ONSC 7547, at para. 19. Similarly, following the 1985 amendments to the Divorce Act, there has been no need for jurisdiction to be retained through a nominal support order in the recipient's favour at the time of the divorce. See: Folga v. Folga (1986), 1986 CanLII 6331 (ON SC), 2 R.F.L. (3d) 358 (Ont. H.C.).

[201] I reiterate that the preference put forth by the applicant was for an award for retroactive spousal support that would not be paid out in a lump sum, but rather would be held in reserve as a shield against future child support payments owed by Mr. Forbes for William.

[202] I make two observations regarding that request.

[203] The first is that the request demonstrates that Mr. Forbes continues to lack any insight whatsoever into the reliance children place upon their parents for food and shelter. Again, Mr. Forbes has placed his own needs ahead of this child.

[204] The second is that the proposition does not find support in the law. The law is well settled that child support has priority over spousal support. See: Divorce Act, s. 15.3 and Family Law Act, R.S.O. 1990, c. F.3, s. 38.1. “[A]s a general rule, setting off a spousal debt against child support is undesirable and is to be avoided”: see Barkhouse v. Wile, 2014 NSCA 11, 340 N.S.R. (2d) 194, at para. 20.

[205] Prior to commencing my analysis, I observe that the test for imputing his income for child support purposes applies equally for spousal support purposes. See: Decker v. Fedorsen, 2010 ONCJ 618, at para. 11; Rilli v. Rilli, 2006 CanLII 34451 (ON SC); Perino v. Perino, 2007 CanLII 46919 (ON SC). Accordingly, I find no reason to recalculate the incomes found above for purposes of child support for the consideration of spousal support.

[206] The relevant factors in deciding the suitability of a retroactive spousal support order include the needs of the recipient, the conduct of the payor, the reasons for the delay in seeking support, and any hardship the retroactive award may occasion upon the payor spouse. See: S.P. v. R.P., 2011 ONCA 336, 332 D.L.R. (4th) 385, at para. 11; and Kerr v. Baranow, 2011 SCC 10, [2001] 1 S.C.R. 269, at para. 207.

ii. Mr. Forbes’ conduct

[207] I find that Mr. Forbes’ conduct is an important factor in his request for spousal support.

[208] Mr. Forbes either hid significant income or, if he did not have significant income, was grossly and deliberately underemployed from the date of separation until the end of March 2016.

[209] I reiterate that it was Mr. Forbes’ position that Juggernaut had not recovered after the 2004 robbery. If the corporation’s line 150 income is correct, he had five years from that time to understand that the business was not making any money. He should have obtained suitable employment within that time frame. Within three months of his first job application, he began employment paying in excess of $82,000 per year. He is clearly a very talented individual who I find could have at any time that he wanted found suitable employment.

[210] There are three aspects to that conduct which are important from the standpoint of spousal support. The first is that any financial fallout from that conduct should not be visited upon the respondent. The second is that Mr. Forbes delinquency in child support payments created a very difficult financial situation for Ms. Forbes. The third is that Mr. Forbes should not benefit from his own reprehensible conduct.

iii. Mr. Forbes’ means

[211] Given Mr. Forbes’ steadfast refusal to make adequate disclosure, it was impossible for me to ascertain his means with any certainty. I can, however, make the following observations.

[212] Mr. Forbes, time and time again, suggested that he had left the matrimonial home at 12 Phair Crescent with nothing. The implication being that he should have received an equalization payment. The suggestion being that, as a result, Ms. Forbes had the means to pay spousal support and he had the need to receive spousal support.

[213] For example, I reiterate that it was his evidence that he had signed the matrimonial home over to Ms. Forbes in 2008 for purposes of refinancing. Ms. Forbes still owns and lives in the home as of the date of trial. I, however, found that the evidence given by Mr. Forbes painted a less than accurate picture for many reasons. As an example, as said above, the abstract of title for that property demonstrated that Mr. Forbes had never owned that house. In other words, his assertion that he had signed it over to Ms. Forbes was not true. As another example, on October 31, 2009, Mr. Forbes withdrew $12,664.29 from the company. That was only about one month prior to the date of separation. I reiterate none of Mr. Forbes’ bank records were in evidence and so I have no way of knowing what happened to that money.

[214] Mr. Forbes also maintained that he had never received any money for the company's assets. That was notwithstanding those assets are now gone. There was no evidence as to where the assets went. The May 31, 2011 balance sheet indicates $40,711.25 in fixed assets. Those assets include furniture, computer equipment, a vehicle, fixtures, and software. I simply do not believe that Mr. Forbes disposed of all of those assets and received absolutely nothing in return. Not a single dollar for any of the furniture or computers or software or other assets. It defies common sense.

[215] Mr. Forbes relies very heavily upon the mountain of debt with which he is saddled in support of his request for spousal support. I make two observations regarding that debt. The first and most obvious is that Mr. Forbes has no one to blame but himself for that debt. The second is that there is not necessarily a link between that debt and Mr. Forbes’ income. I say again that there were only a few months of personal and corporate bank statements in evidence. There were no credit card statements, no books of original entry. It follows that I have no way of ascertaining how much cash Mr. Forbes had available to him in each year. I have no way to know how much Mr. Forbes was actually spending. Given the evidentiary vacuum, other explanations such as Mr. Forbes having a spending problem, a gambling problem, a drug problem, or any one of a number of other possible problems are all possible. It is possible that he has hidden money in bank accounts with friends. To be clear, I am not finding that Mr. Forbes has any of those problems or that he has money in hidden bank accounts. I am only pointing out that because of his steadfast refusal to provide the court with adequate disclosure, I have no way of knowing. Mr. Forbes should not get the advantage of the evidentiary vacuum he chose to create.

[216] Finally, Mr. Forbes suggests that Ms. Forbes’ willingness to forgo in excess of $30,000 in section 7 expenses ought to be considered by myself as an acknowledgment by Ms. Forbes that there must be some “fair resolution”. I was left with the impression that the applicant wanted me to believe that Ms. Forbes would find it unfair for Mr. Forbes to participate in the special and extraordinary expenses for his children. To be blunt, I find that proposition absurd. I find it far more likely that Ms. Forbes perceived the potential for Mr. Forbes to participate in section 7 expenses futile given his history of chronic and persistent avoidance of his child support obligations.

[217] Finally, the income imputed to Mr. Forbes exceeds that of Ms. Forbes throughout the relevant time frame.

iv. Mr. Forbes’ needs

[218] Mr. Forbes also suggested that his housing arrangements were indicative of need. He testified that after separation he briefly moved into his parent’s home. For the next two years or so Mr. Forbes rented a house at Stafford Crescent with his friend Vlado Vali. His share of the rent was $400 per month.

[219] By 2011, Mr. Forbes was spending most of his time living at 410 North Street with Ms. Leach. Both Mr. Forbes and Ms. Leach placed a great deal of emphasis on the fact that the two had not agreed to be partners until about 2013. That does not alter the fact that Mr. Forbes was living there and that Ms. Leach was paying almost all of the bills. Those bills included, without limitation, the mortgage, utilities and the like. Ms. Leach is an investment broker working with Scotia McLeod. Mr. Forbes continued to live with Ms. Leach and her daughter Taylor until December 2015. I reiterate that Matthew moved in with them in November of 2013. After Matthew moved in, Mr. Forbes would contribute when he could for things like groceries.

[220] After some time, they moved to 70 Summerdale Crescent.

[221] I find that Mr. Forbes lived quite well during that time frame.

[222] I do not find it a stretch to conclude that Ms. Leach's homes were both quite nice. The one at 410 North Street sold for $247,500 and the one at 70 Summerdale Crescent was purchased for $355,000. The Summerdale home has an in-ground swimming pool.

[223] Ms. Leach and Mr. Forbes also traveled together. In 2010 they went to Mexico. They also took small trips to places such as Cedar Point, Wonderland, Chicago, Ottawa, and Deerhurst Lodge in the Huntsville area. It was primarily Ms. Leach who paid for those trips. It was her evidence that she did so because she cared for the boys, meaning Mr. Forbes’ sons. According to Ms. Leach, they were like a family.

[224] Ms. Leach also bought out the lease on Mr. Forbes’ car when he could not afford to do so. She paid for his insurance for several years so that he could drive that car.

[225] Ms. Leach also loaned Mr. Forbes money. She opened a separate line of credit in order to help keep track. She paid things like traffic tickets, car lease payments, hotels for the new job, first month’s rent on his apartment after she had asked him to move out, legal bills, and a futon for the boys to sleep on when they were at her house. She estimates that at this point in time Mr. Forbes owes her about $19,000.

[226] In other words, Mr. Forbes financial needs between 2011 in December 2015 were at the low end of the spectrum because of the generosity of Ms. Leach. He had a very good deal going with Ms. Leach.

[227] There was consensus that the relationship came to an end in December 2015. According to Ms. Leach, she had encouraged Mr. Forbes to find a job and she said that she believed that Mr. Forbes had. I reiterate that although Mr. Forbes testified that he had looked for employment while he was still living with Ms. Leach, he was unable to produce any documentary evidence of applications made prior to December 31, 2015. I reiterate that I did not believe Mr. Forbes when he said that he had applied for jobs prior to then. Not surprisingly, according to Mr. Forbes it was also financial stress that had led to Ms. Leach asking him to move out.

[228] Ms. Leach and Mr. Forbes remain friends. At trial Ms. Leach was unable to say where the relationship may go in the future.

[229] Mr. Forbes’ needs during the relevant time frame must also be considered in the context of his uncanny ability to avoid paying what he owes to others. The following are some examples of payments owing but not made.

[230] The first is that Juggernaut owes $49,394.57 in payroll withholding taxes and $34,329.71 in income tax including HST. I calculate that to be $83,724.28. There was no evidence that Juggernaut had paid any income tax whatsoever throughout the relevant time frame other than that which the CRA managed to garnish from the corporate bank accounts. In other words, Mr. Forbes used HST withholdings, employee withholdings, and tax that Juggernaut ought to have paid on income for himself.

[231] The second is that there was no evidence that Mr. Forbes has paid any personal income tax whatsoever since separation and possibly before that. According to Mr. Forbes, as of the date of trial he owed approximately $17,000 to the CRA. Again, Mr. Forbes used that money for himself.

[232] The third is that he did not repay the $54,000 that Juggernaut borrowed from Ms. Forbes’ parents and secured with shares in Juggernaut. Again, Mr. Forbes potentially had that money for himself.

[233] The fourth is that he did not repay the $35,685 that Mr. Forbes maintains that he borrowed from his own parents. Again, Mr. Forbes used that money for himself.

[234] The fifth is that he paid only a fraction of the child support that he had been ordered to pay. Regular payments only began with the garnishment of his income from his new employer. I have no reason to believe that he would have voluntarily paid against his child support arrears but for those garnishments.

[235] The sixth is that he lived with Ms. Leach for a number of years. He made very little in the way of contribution to that household. I reiterate that it was she that made the mortgage payments, utility payments, and the like. I reiterate that Mr. Forbes drove a car that Ms. Leach paid for and insured. Mr. Forbes only meaningful contribution was to groceries from time to time. As said above, Mr. Forbes owes Ms. Leach approximately $19,000 as of the date of trial.

[236] In other words, throughout the relevant time frame Mr. Forbes’ needs have been modest indeed. Income with no tax, a place to live with little expense, a car to drive financed by someone else, and serious underpayment of child support.

v. Ms. Forbes’ means

[237] Ms. Forbes has what I would describe as modest assets. She owns a home in which she values at $204,000, and which is subject to a mortgage in the amount of $160,000.

[238] With the greatest of respect, that house pales in comparison to the comparatively opulent surroundings in which Mr. Forbes was living rent-free.

[239] Ms. Forbes also has an RESP in the amount of $2,000 which she plans to use for the children's education. Finally, Ms. Forbes has her teacher’s pension. Although there was no valuation of that pension, I have no doubt that Ms. Forbes’ pension is quite valuable. That is, however, of little assistance to her now, because it does not produce income to which he has immediate access.

[240] Ms. Forbes has also done some traveling. She took her children to the Bahamas a few years ago. Each summer she takes her children to her parents’ cottage.

[241] Finally, Ms. Forbes’ income has throughout the relevant time frame been less than that imputed to Mr. Forbes.

vi. Ms. Forbes needs

[242] Ms. Forbes testified that because Mr. Forbes did not honour his child support obligations in a timely fashion, she was forced to cash RRSPs, continually refinance her home, and borrow from her parents to feed and house their children. I had no reason to disbelieve that evidence. In other words, Ms. Forbes needs exceeded her means principally because of Mr. Forbes unwillingness to support his children.

b) Conclusions

[243] Mr. Forbes is clearly in a difficult situation as a result of the debt he has accumulated since the date of separation. I say again that there is no one to blame but Mr. Forbes. Either Juggernaut was making money that Mr. Forbes was not reporting or he was grossly under-employed. In any event, the consequences of Mr. Forbes conduct should not be visited upon Ms. Forbes.

[244] Further, I find that Mr. Forbes has lived relatively better than Ms. Forbes throughout the relevant time frame. His uncanny ability to obtain money from his mother, Ms. Leach, his business partner, and others has served his lifestyle well.

[245] Accordingly, I can see no reason to award Mr. Forbes spousal support either on a retroactive basis or on a go forward basis.

D. JUDGMENT

1) Custody and access

[246] On a final basis, I confirm that the child Matthew Paul Forbes born August 3, 1998 (“Matthew”) was in the custody of Jeffrey Forbes from November 1, 2013 until his 18th birthday on August 3, 2016, with the exception of December 15, 2015 until April 12, 2016, when he was in the custody of his mother. I confirm that the residency of Matthew continued with Jeffrey Forbes after Matthew reached the age of 18 and continues to be with Jeffrey Forbes as of today

[247] The child William Albert James Forbes born July 11, 2000 (“William”) has been since separation and shall in the future remain in the custody of Mary Claire Forbes until further order of the court.

[248] Jeffrey Forbes shall continue to have access on alternate weekends and one night each week as well as one week at Christmas holidays so that the siblings can be together. He shall pick up the child at the commencement of visits and drop him off at the conclusion of visits at the mother's home.

[249] Jeffrey Forbes shall have access to health education and general welfare information of William and may access such information independently of Mary Claire Forbes.

[250] The parties shall communicate via text message or e-mail and they shall be respectful.

[251] William has a cellular phone that he and the parents can use to communicate directly by text and voice. Each parent may contact the child who will be permitted by each parent to use the devices to communicate with each parent by text, voice or otherwise, independent of the other parent and without interference from the other parent.

[252] The party having William in their care shall be supplied with William’s passport, birth certificate and health card, which shall otherwise be in the custody of Mary Claire Forbes.

[253] If either party wishes to travel to the United States of America or out of province they shall advise the other in writing of the attendant trip, the locale and duration but they need not obtain the consent of the other parent. The other parent shall provide any required travel consent, the child's passport, birth certificate, and health card.

[254] If a signed authorization, written direction, travel consent or other document is required for any reasonable purpose, each parent shall execute any reasonable document to ensure the spirit and intent of this order is carried out.

[255] Neither parent shall speak in a disparaging manner toward the other parent or about the other parent in the presence of the child.

[256] Each parent shall use their best efforts to encourage the child in their care to maintain contact and refrain from disrespectful conduct toward the other parent.

2) Ongoing Child Support

[257] Given the applicant’s imputed annual income of $100,000, the respondent’s estimated income of $95,806, the current split custody arrangement, and the fact that Matthew is now over 18 years of age and continuing with postsecondary education, no child support is payable by either party to the other.

3) Child Support arrears

[258] Child support arrears inclusive of costs awards owing by the applicant Jeffrey Paul Forbes to the respondent Mary Claire Forbes are fixed at $60,927.48 as at November 1, 2016. Those arrears shall be repaid in monthly installments of $1,000 commencing December 1, 2016. In addition to any other reason for the court to revisit this repayment schedule, it may be revisited by the court at the request of the respondent if the applicant defaults on any payments.

4) Ongoing section 7 expenses

[259] Given the applicant’s imputed annual income of $100,000 and the respondent’s estimated income of $95,806, the applicant Jeffrey Forbes shall pay all of the section 7 expenses related to Matthew Paul Forbes born August 3, 1998, with the exception of any expenses for post-secondary education, and the respondent Mary Claire Forbes shall pay all of the section 7 expenses related to William Albert James Forbes born July 11, 2000. That is with the exception of any expenses for post-secondary education for Matthew and William.

[260] William is not currently enrolled in post-secondary education.

[261] As to Matthew’s post-secondary education, the contributions of the parties shall be as follows:

a) Mary Claire Forbes shall pay $2,500 per term for a total of $5,000 per year for Matthew's post-secondary education upon receipt of confirmation of enrollment in each of those terms. Those payments are to be made directly to Matthew and to begin January 1, 2017, with the last payment being on the earlier of Matthew no longer being enrolled in a postsecondary education facility or the end of the school term commencing on or about January 1, 2020.

b) Jeffrey Forbes shall pay $2,500 per term for a total of $5,000 per year for Matthew's post-secondary education upon receipt of confirmation of enrollment in each of those terms. Those payments are to be made directly to Matthew and to begin January 1, 2017, with the last payment being on the earlier of Matthew no longer being enrolled in a post-secondary education facility or the end of the school term commencing on or about January 1, 2020.

5) Arrears of section 7 expenses

[262] The arrears of section 7 expenses payable by both the applicant and the respondent are “nil” as of November 1, 2016

6) Life Insurance

[263] The applicant Jeffrey Forbes shall designate the respondent Mary Claire Forbes in trust for the children as irrevocable beneficiary of his life insurance plan through his employer Infotech Research Group. Should Jeffrey Forbes die without the life insurance provided for herein being in place, or should there be any shortage in the proceeds of the life insurance policy for the liability of Jeffrey Forbes for any child support owing at the time of his death, liability for such support shall bind his estate. Jeffrey Forbes shall provide proof of such designation within 60 days of this judgment and on or before each anniversary of this judgment.

[264] The respondent Mary Claire Forbes shall designate one or both of her parents in trust for the children as irrevocable beneficiary of her life insurance plan through her employer Thames Valley Board of Education. Should Mary Claire Forbes die without the life insurance provided for herein being in place, or should there be any shortage in the proceeds of the life insurance policy for the liability of Mary Claire Forbes for any child support owing at the time of her death, liability for such support shall bind her estate. Mary Claire Forbes shall provide proof of such designation within 60 days of this judgment and on or before each anniversary of this judgment.

7) Income Information

[265] On or before May 31 each year, the applicant and the respondent shall provide each other with a copy of their respective income tax returns (together with all attachments thereto), any notices of assessment/reassessment for the previous taxation year, and any corporate tax returns for any companies in which either party is a shareholder.

8) Director of Family Responsibility

[266] Unless the support order is withdrawn from the director of the Family Responsibility Office, it shall be enforced by the Director and the amounts owing under the support Order shall be paid to the Director, who shall pay them to the person to whom they are owed.

9) Ongoing Spousal Support

[267] The claims for ongoing spousal support and spousal support arrears by the applicant Jeffrey Forbes as against the respondent Mary Claire Forbes are dismissed.

10) Interest

[268] Any payments due under the terms of this order will incur interest from the date of this order in accordance with the Courts of Justice Act, R.S.O. 1990, c. C.43.

11) Costs

[269] In the event that the parties are unable to agree on costs within seven (7) days, then Costs submissions shall be in writing on the following basis:

a) Respondent’s counsel shall serve costs submissions and a “Cost Outline” as provided for in Rule 57.01(6) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (using Form 57(b)) upon the applicant’s counsel within fourteen (14) days. Such written argument shall be no more than three (3) pages in length. In the event the foregoing is not complied with within that time period, the respondent shall be deemed to have waived her right to do so.

b) The applicant’s counsel shall have a further ten (10) days to provide a response to counsel for the respondent. Such response is to be no more than three (3) pages in length. In the event the foregoing is not complied with within that time period, the applicant shall be deemed to have waived his right to do so.

c) Counsel for the respondent shall have five (5) further days to provide a reply to counsel for the applicant. Such reply is to be no more than one (1) page in length. In the event the same is not complied with within that time period, the respondent shall be deemed to have waived her right to do so.

d) Once all of those steps have been completed, counsel for the respondent shall provide all the submissions to the court through Trial Co-ordination.

e) The costs submission shall be double-spaced and use a “Times New Roman” font no smaller than 12 pitch. All references to the length of submissions exclude Bills of Costs and Costs Outlines and any Offers to Settle.

Original signed by Justice Christopher M. Bondy

Christopher M. Bondy

Justice

Released: December 2, 2016

CITATION: Forbes v. Forbes, 2016 ONSC 7407

COURT FILE NO.: FD 770/09 Ext 02

DATE: 20161202

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Jeffrey Paul Forbes

Applicant

– and –

Mary Claire Forbes

Respondent

REASONS FOR JUDGMENT

Bondy J.

Released: December 2, 2016