Chao v. Chao, 2016 ONSC 7911
Court File No.: 46768-12 Date: 2016-12-20 Superior Court of Justice - Ontario
Re: Anne Elizabeth Chao, Applicant And: David Chih Ching Chao, Respondent
Before: The Honourable Justice D. A. Broad
Counsel: Glenda McLeod, for the Applicant Alex Toolsie, for the Respondent
Heard: September 20, 2016
Endorsement
Nature of the Motions
1The applicant wife has brought a motion for summary judgment in respect of her claims for equalization of net family property and spousal support. She brings her motion pursuant to Rule 16 of the Family Law Rules and argues that there is no genuine issue requiring a trial in respect of these claims.
2The applicant also seeks, as part of the relief on her motion, a vesting order in respect of the parties’ former matrimonial home referable to her claims for equalization and spousal support. She has also brought a supplementary motion seeking to strike out portions of the respondent husband’s affidavit sworn August 11, 2016.
3The applicant’s motion to strike portions of the respondent’s affidavit was argued as a preliminary matter, following which I reserved my decision on it. Counsel for the parties thereafter made their submissions on the applicant’s motion for summary judgment.
Background
4The following is a summary of the facts that I have been able to glean from the voluminous and complex affidavit material filed by the parties.
5The applicant and the respondent were married on April 18, 1974 and separated on November 30, 2011 after 37 years of marriage. There were four children of the marriage who are each now grown and independent.
6At the time of the marriage the respondent was finishing his university education in computer science. He worked in the computer industry continuously until 1994 with the exception of two years from 1986 to 1988 when he left the workforce to become involved in volunteer church work. The respondent was laid off from his employment in 1994 and has not been employed since that time.
7The applicant worked full time until 1978 when she resigned from her position and did not work outside the home until the separation date, with the exception of some part-time work as a piano teacher for a brief period immediately prior to separation.
8Throughout the marriage, and in particular from and after the respondent stopped working in 1994, the family subsisted on income from investments acquired from advances made at various times by the respondent’s parents. The respondent’s parents, as early as 1975, advanced to the parties half of the acquisition cost of their first home. In 1983 the parties sold their first home and purchased the matrimonial home which they owned on the date of separation for $260,000, of which respondent’s parents contributed one-half of the purchase price.
9Included in the advances made by the respondent’s parents was an amount generated from the sale of the parent’s home in Toronto for the sum of $457,000 in 2003. The respondent stated that “a large portion” of the proceeds went into investment accounts of the applicant and the respondent and “a smaller portion” was used to make payments against the principal of the mortgage on their matrimonial home.
10It is unclear from the affidavit material, but there may have been other advances made by the respondent’s parents. It is acknowledged that all of the investments owned by the parties prior to their separation were derived from these advances and not from savings derived from their own earnings.
11The respondent’s father is now deceased and his mother is 89 years of age and resides in British Columbia.
12The respondent assumed responsibility for managing the investments which the parties acquired from his parents’ advances. Some of the investment accounts were in the respondent’s name alone, some were held in the applicant’s name alone, some of the accounts were in the names of the applicant and the respondent jointly and some of the accounts were held in the names of the applicant and/or the respondent along with certain of their children.
13In addition to the income from these investments, the parties also derived income from time to time by renting out rooms in their home.
14Sometime following separation the parties agreed upon a value of the matrimonial home of $780,000 and consented to an order made by Reilly, J. on January 22, 2016 that the applicant’s interest in it be transferred to the respondent for the sum of $390,000. The order provided that the transfer be completed by March 31, 2016 and it appears to have taken place by that date.
15No detailed and organized listing of the various investment accounts owned by the parties or in which the parties had interests on the separation date is evident from a review of the affidavit material filed by the parties. Nor is there a reliable and comprehensive verification of the total value of the investments on separation or at any other time. The applicant says that this is because during the marriage the respondent controlled and managed the investment accounts and he has failed to provide proper disclosure of the details of the investment accounts to her in this proceeding.
16The applicant’s Amended Net Family Property Statement dated August 26, 2016 sets forth certain particulars of investment accounts based upon the information which she has been able to piece together from the information that was forthcoming from the respondent. Included in the listing are accounts which she says were disposed of by the respondent immediately prior to and after the separation and the proceeds paid over to his mother Lillian Chao or placed into accounts maintained by the respondent with his mother or other members of his family. She says that the respondent has admitted in questioning to disposing of over $1,000,000 in assets. She deposed in her affidavit that “on or about the time of our separation, the Respondent dissolved our joint, and his personal bank accounts, investment and shares, the amounts of at least $1,500,000.” She alleged that the approximate total is likely much higher as the Respondent has not provided full, frank and complete disclosure to her. The applicant’s Amended NFP Statement lists a total current value of accounts and savings in her name of $83,499.77 and $1,234,804.93 in the name of the respondent, which figure includes investments which she says were transferred or liquidated by the respondent prior to or after separation.
17The applicant has acknowledged that she withdrew the sum of approximately $32,000 from a joint investment account following separation. She says that she has accounted for this amount in her NFP Statement. She says that she made this withdrawal because the respondent started liquidating and disposing of assets prior to separation and continued to do so afterwards and she needed to ensure that she had funds available to support herself.
18The respondent acknowledged in questioning that he transferred substantial assets from the investments to his mother. He says that when the separation occurred his parents became worried and asked him to pay back “their investments”. He says that when the applicant withdrew $32,000 from an investment his parents became upset and he “had to liquidate the rest of their investments.”
19The respondent admitted to forging the applicant’s signature in order to liquidate an investment which was partly in her name. The applicant also points to the respondent having forged her signature in order to remove her name from an investment she held with the respondent and his mother. She says that the respondent also instructed and arranged for his mother to misrepresent herself to Canada Post as the applicant in order to redirect the applicant’s mail to her.
20The applicant deposed in her initial affidavit in support of her motion that her position is that any and all funds received from the Respondent’s parents ought to be classified as gifts to her and the respondent. She stated that the respondent was solely responsible for management of the parties’ joint and his personal finances. She therefore has no knowledge of the exact amount of funds which were gifted by the respondent’s parents, where those funds were applied nor the quantum of income they earned jointly and personally from the investments. The applicant deposed “it was my understanding, which was formed based on the respondent’s advice to me, that any and all funds we received from the respondent’s parents were gifts made to both of us, and at no time was there any expectation of repayment of same to the respondent’s parents.”
21For his part the respondent deposed in his affidavit that the investments came from his parents’ money, and were placed under his and the applicant’s names as well as their children’s names, during the 19.5 year period that he was unemployed. The income on the investments was used to pay the majority of the living expenses of the family. He stated that the applicant was aware that the investments came from his mother.
22The respondent deposed that there are outstanding loans remaining owing to his mother totalling approximately $99,582, comprised of $10,000 advanced in 2010, $6,300 in 2006, $73,282.40 in 2005 and $10,000 from 1999 to 2003. He says that the applicant’s portion of these loans is $54,791.20.
23The respondent deposed that investments were placed in the joint names of himself and the applicant due to his poor health. Some bank accounts were held jointly with the parties’ children so that money could be transferred easily.
24The respondent deposed “whether these investments are treated as gifts from my mother to me, or as belonging to my mother, I believe the outcome of the division of assets under the Family Law Act is the same, which is, the applicant should not have any claim on them.”
25The respondent appended as an exhibit to his affidavit an affidavit of his mother Lillian Chao sworn March 7, 2013. In her affidavit Lillian Chao deposed, inter alia, to the following:
(a) in 1975 she and her husband (the respondent’s father) contributed half of the purchase price of the parties’ first home on the understanding that whenever the house is sold they would receive half the proceeds;
(b) in 1983 the parties sold their first home and bought their current home (the matrimonial home on the date of separation) at which time she and her husband topped up their contribution to $130,000, being one-half of the purchase price, with the same understanding that they were to receive half of the proceeds when the house was sold;
(c) the investments being contested in court are “our money” [that is hers and her husband’s]. During 1986-1988 and since 1994 until the parties’ separation in 2011 neither of the parties had a full-time job and she and her husband supported their family’s living expenses by having the respondent manage their investments and by giving the dividends, capital gains and interest to the respondent;
(d) she and her husband continued to make their habitual donations [presumably to their church] of 10% of their annual income, including the investment income in the hands of the respondent and the applicant “since these are produced from our money.” They donated an average of $12,000 per year, far exceeding 10% of their own combined pension income of approximately $75,000;
(e) the account that the applicant closed out after she left the respondent, receiving the balance of $31,824.38, formed part of the investments mentioned above. She stated “this money belongs to us. It was in trust for their [that is the applicant and respondent] 4 children.”
(f) when she and her husband sold their house in Toronto for $457,000 the majority of the proceeds were used to help the respondent’s financial needs, such as reducing and eventually paying off the respondent and applicant’s mortgage, and increasing the investments in their hands;
(g) throughout the years she and her husband lent funds to the respondent and the applicant totalling $99,582.40 which is still outstanding;
(h) she and her husband love the respondent dearly and never considered it necessary to write down any house purchase agreements and loan agreements. This was the same practice for loans to their other children and to their grandchildren (the applicant and respondent’s children).
26Neither the respondent nor Lillian Chao has produced any documentation respecting the advances made by the respondent’s parents to the parties. In particular there exist no loan agreements, promissory notes, or trust agreements. Similarly, the applicant has not presented any documentation confirming that the advances were intended by the respondent’s parents to be gifts, and if so, to whom.
27Neither party set forth their current incomes for 2016 in their affidavit material. The applicant says that the parties’ respective incomes for 2011 (being the year of their separation) should form the basis for determination of the amount of investment income available to the respondent, being the last year “in which the respondent was not motivated to artificially reduce his income for the purposes of evading his support obligation” and given that he “did not begin his unilateral depletion of joint banking accounts, investments and mutual funds until on or about our separation”. The parties’ aggregate reported interest, investment, dividend and capital gains income in 2011 was $49,242.87, divided between the applicant at $28,526.52 and the respondent at $20,716.35. In addition the applicant says they had $18,600 in rental income, although they only reported $7,200. She also says that the respondent acknowledged in questioning to receiving $3,000 per month from his mother.
28The respondent disputes the applicant’s calculations and denies that the investment income reported in 2011 is representative or their true income during the marriage. He says that in 2011 there was interest income on a loan that the parties made to their church which has since been repaid and that capital gains were generated in that year from the liquidation of BMO Investorline accounts in order to return the proceeds to his mother. He also says that all three rooms in their house were never rented out simultaneously. Moreover he says that the $3,000 per month he said he received from his mother was an estimate of the dividend and interest income throughout the 20 years that he was unemployed. It does not represent an additional amount separate from the income on the investments.
29The respondent says that, without considering the financial support from his mother and his RRSP withdrawals, he currently earns less than the applicant.
30The applicant points to the parcel register for a property on Erbsville Road, Waterloo, Ontario showing the respondent as one of six registered owner. This property was sold following separation for $1,390,000. The applicant states that the respondent’s 1/6 interest in this amount should be included in his net family property for equalization purposes. The respondent says that he acquired a 10% interest in the property in 1989 as a gift from his parents, as did his three siblings, as part of a tax strategy employed by his parents. A partnership named Hexagon Enterprise was registered and a partnership agreement was entered into. The respondent says that he transferred his 10% interest to the parties’ four children in 1990 who, over time, transferred their interests back to his mother. He says he had no beneficial interest in the Erbsville property on separation and received no part of the sale proceeds.
Motion to Strike Portions of the Respondent’s Affidavit
31The applicant has moved to strike portions of the respondent’s affidavit of August 11, 2016, as follows:
(a) para. 113 [setting forth the respondent’s reasons for selling investments following separation];
(b) paras. 115-119 [respondent’s allegations of errors made in the applicant’s affidavit of July 14, 2016 respecting particulars of the parties’ investment accounts]; and
(c) Exhibits D-L [documents created by the respondent or not previously disclosed by the respondent in his Affidavit of Documents].
32The applicant withdrew her request to strike paras. 65-69 of the affidavit during submissions.
33The applicant argues that the respondent has failed to provide full and complete disclosure in accordance with the Family Law Rules. By order of Justice Gordon on July 30, 2013 he was ordered “to provide documents from 2010 forward as to his pension and investments.” During questioning on May 25, 2015 the respondent refused to answer three questions and gave twenty undertakings, which the applicant says have not been answered or satisfied. By order made on January 22, 2016 Justice Reilly ordered the respondent to provide “as best as he is able” answers to the refusals and undertakings by March 31, 2016.
34Following March 31, 2016 the applicant moved to strike the respondent’s pleadings for failure to obey the order of Justice Reilly. Justice Flynn found that the use of the phrase “as best as he is able” did not satisfy the requirements that an order be mandatory, precise and capable of enforcement in order to justify the striking of a party’s pleadings for non-compliance.
35It is noteworthy that Justice Flynn, in his reasons, did not make a finding that the respondent had, in fact, used his best efforts to comply with his undertakings and to answer the questions that he refused on questioning nor that the respondent had discharged his disclosure obligations, but rather he rested his decision not to strike the respondent’s pleadings on the non-mandatory nature of Justice Reilly’s order.
36The obligation to provide full and complete disclosure of relevant documents under r. 19 of the Family Law Rules is a continuing one. This is evident from r. 19(8) which provides that a party who finds a document that should have been listed in her or his affidavit of documents or who finds that the list of documents contained in the affidavit is not correct or complete must serve a new affidavit of documents listing the correct information.
37R. 19(10) provides that a party who does not follow that rule or obey an order made under the rule the court may, in addition to any power to make an order under sub-rules 1(8) or (8.1), order that a document favourable to the party’s case may not be used except with the court’s permission.
38R. 1(8) provides that if a party fails to obey an order the court may deal with the failure by making any order that it considers necessary for the just determination of the matter, including making an order that all or part of a document that was required to be provided, but was not, may not be used in the case.
39R. 1(8.1) provides that if a person fails to follow the rules the court may deal with the failure by making any order described in sub-rule (8), with the exception of a contempt order.
40The Family Law Rules do not specifically deal with the consequences of a failure to answer proper questions on questioning or to comply with undertakings given on questioning. However r. 30.08(1) of the Rules of Civil Procedure provides that where a party fails produce a document in compliance with an undertaking, if the document is favourable to the party’s case, the party may not use the document at the trial except with leave of the trial judge.
41The applicant submits that the respondent has, in his affidavit in response to her motion, produced limited financial documentary disclosure and limited financial information, when the documentation and information ought to have been produced earlier in his Affidavit of Documents, provision of financial disclosure pursuant to the Family Law Rules and the order for disclosure of Justice Gordon, and by answering the questions he refused to answer on questioning and by satisfying his undertakings. She argues that the statements made by the respondent in his affidavit show that he has in his possession documents which he had earlier denied existed or were available to him.
42The respondent did not in his Factum, nor in oral submissions, dispute the applicant’s position respecting the striking of portions of his affidavit.
43In my view paragraphs 115-119 of the respondent’s affidavit of August 11, 2016 should be struck out for the reasons cited by the applicant. In those paragraphs seeks to “correct” “errors” made by the applicant in her affidavit respecting the investment accounts. It is evident that in so doing he puts forth information and figures derived from documents which he ought to have, but did not, disclose earlier.
44I see no reason to strike out para. 113 of the affidavit in which the respondent seeks to explain his reasons for liquidating the accounts.
45I would strike out exhibit D to the respondent’s affidavit as it is stated by the respondent to be undated handwritten lists made by him which he “discovered” when he “found” a file and “discovered” that it contained “some evidence to support my case that while I was unemployed, my mother provided investments in our names for our living expenses.”
46The handwritten list is self-serving, has marginal probative value and in any event should have been disclosed earlier by the respondent. The probative value of handwritten list is marginal because there is no suggestion by either party that the investment accounts owned by them or with their children originated from their own earnings or resources. It is common ground that the investments were derived from advances made by the respondent’s parents. The issue is how to properly characterize those advances, whether as gifts, loans or as subject to a resulting trust.
47I would not strike out Exhibit E which are “Gift in Kind Statements” issued to Lillian Chao by her church in 2007, 2008 and 2011 as support for the allegation that she made donations of securities from the investment accounts, which she was able to do because she was the “true owner” of the investments. There is no evidence that these receipts were in the respondent’s possession or control prior to the making of his affidavit and they are not caught by the order of Justice Gordon.
48The documents appended as Exhibits F, G, H, I, J, K, and L relate to the Erbsville property and the business named “Hexagon Enterprise. The business name registrations for Hexagon Enterprises at Exhibit H and I are public documents, as are the municipal documents at Exhibit J. There is no basis to infer that the respondent was in possession or control of the documents at Exhibits F, G, K and L prior to the making of his affidavit and they are not caught by the order of Justice Gordon.
49Exhibit L consists of page 3 of the index to the Continuing Record in the proceeding. It is difficult to see the basis for it being struck out.
Motion for Summary Judgment
(a) Position of the Applicant
50The applicant’s position is that there are no genuine issues requiring a trial in respect of her claims for equalization of net family property and spousal support.
51With respect to equalization, the applicant says that the respondent has not presented any evidence to support his allegation that the investment accounts which the parties acquired during the marriage, and which the respondent largely liquidated prior to and after separation, rightfully belonged to his mother. The applicant does not dispute that she and the respondent received monetary gifts from the respondent’s parents, however she says that his parents had no expectation of repayment by either of them. She says that the respondent grew the parties’ savings over the course of the marriage and devoted the time and energy that he would have otherwise have expended by maintaining full-time employment in amassing assets of a value in excess of $1,000,000. She says that she is entitled to share in this wealth, not only because she was a joint owner of some of the investment funds, but also by virtue of “both the Divorce Act and the Family Law Act” (although it is not apparent how the Divorce Act is applicable). Moreover, the applicant points out that the respondent did not specifically plead in his Answer that the investments were subject to a trust in favour of his mother.
52With respect to spousal support, the applicant argues that, given that the respondent unilaterally depleted the parties’ investments, he ought to be attributed for support purposes the entirety of any income which would have been earned on those investments. She says in her Factum that his income ought to be imputed at $112,330.00 per annum, calculated as following:
(a) Pension income - $3,276 (disclosed by the respondent)
(b) Dividends – $15,131 (2011 dividend income claimed by the parties)
(c) Interest/investment - $5,388 (2011 interest/investment income claimed by the parties);
(d) Capital gains - $27,288 (2011 capital gains claimed by the parties)
(e) Other income - $1,435 (claimed by the respondent in 2011);
(f) Rental income - $7,200 (claimed by the parties in 2011, not subject to appropriate taxation so subject to gross up)
(g) Funds from Lillian Chao: $26,000.
(it is noted that these items appear to total $85,718, not $112,330 as suggested in the applicant’s Factum.)
53The applicant says that she is “clearly entitled” to spousal support pursuant to the Spousal Support Advisory Guidelines (SSAGs).
54The applicant asserts that, by reason of the respondent seeking to shelter assets from her reach and by failing to make proper disclosure, a lump sum award of spousal support is appropriate and necessary to achieve a fair and equitable result for her.
55The applicant argues that under the SSAGs, lump sum support payable by the respondent would extend from a low range of $630,335, a mid-range of $740,191, and a high range of $850,302.
56Notwithstanding this, the applicant stated in her Factum that she is agreeable to limiting her claim for lump sum support to $250,000 “to ensure the timely and efficient finalization of this litigation.”
57In submissions counsel for the applicant acknowledged that her claim for lump sum support should be reduced to account for an order for equalization, since the amount of income which she seeks to impute to the respondent is premised upon the respondent being considered to earning income from the investments which he liquidated on separation. She points out that the respondent has paid no support since separation (however, elsewhere she acknowledges having received $3,000 in support) and an order for support should be made for the period following separation. She does acknowledge that in the event that an order for equalization is made it may be appropriate to reduce or eliminate altogether the respondent’s obligation to pay ongoing support.
58The applicant argues that on the basis of the Parcel Register the respondent was shown as one of six registered owners of the property on Erbsville Road, Waterloo, Ontario which was sold post-separation for $1,390,000 and for the purposes of equalization 1/6 of the sale proceeds should be attributed to him. She argues that, although the respondent has denied that he was an owner of the Erbsville property, the documentation produced by him does not provide any insight into the nature of his ownership interest as of the date of separation.
59The applicant claims that the parties acquired 1000 ounces of silver valued at $33,310.00 and 6 ounces of gold ingots/coins valued at $10,625,10, which have been retained by the respondent post-separation. The respondent confirms the existence of the silver but claims that it was gifted to him by his father in accordance with Chinese tradition and denies the existence of the gold. The applicant submits that, given the issues raised with respect to the respondent’s credibility, the court should prefer her evidence in respect of the silver and gold to his.
60The applicant seeks a vesting order in respect of the respondent’s interest in the former matrimonial home to secure payment of the amount found to be owing to her in respect of equalization and/or support.
Position of the Respondent
61The respondent argues that summary judgment should not be granted as there are numerous issues requiring a trial. He says that there is an issue of whether the investment money was properly a matrimonial asset. If the advances from his parents were loans to him, the investment assets would be excluded from matrimonial property under the Family Law Act. He says that s great deal turns on whether the investment money was a loan, a gift to one spouse, a gift to both or whether a trust was formed in favour of the respondent’s mother. The respondent submits that there is a conflict between the applicant’s evidence that the advances from his parents were gifts to both parties and his mother Lillian Chao’s evidence that the investment accounts remained her property. Respondent’s counsel, in submissions argues that it would be “inadvisable” to decide these issues on a summary judgment motion.
62With respect to the property on Erbsville Road, the respondent submits that property was not included in the matrimonial property. He says that he acquired a 10% interest in the property in 1989 as a gift from his parents, as did his three siblings, as a tax strategy to allow the life-time capital gains tax exemption to be captured before it expired. A partnership named Hexagon Enterprise was registered and a partnership agreement was entered into. In 1990 the respondent transferred his 10% interest to the parties’ four children who, over time, transferred their interests back to Lillian Chao, as they had no interest in developing the land.
63The respondent argues that he should not be ordered to pay spousal support as he is not working. Moreover, he says there is no basis for an award of spousal support on a compensatory basis. He also says that the applicant is not in need of spousal support as she is in receipt of $390,000 as her share of the value of the matrimonial home.
Guiding Principles Respecting Summary Judgment in Family Law Proceedings
64The principles governing motions for summary judgment in a family law context were very usefully summarized by Sutherland, J. in the recent case of Pearson v. Poulin 2016 ONSC 3707 (S.C.J.), at paras. 37-40 as follows (footnotes and citations omitted):
Rule 16 of the Family Law Rules governs motions for summary judgment.
The onus is on the moving party to persuade the court that there is no genuine issue requiring a trial.
The Supreme Court of Canada, in the case of Hryniak v. Mauldin, [2014 SCC 7] set out the process to be followed in applying the expanded summary judgment rules.
The court held that the judge should first determine if there is a genuine issue requiring a trial, based only on the evidence before the judge, without using the judge’s new fact-finding powers. The court's role is narrowly limited to assessing the threshold issue of whether a genuine issue exists as to material facts requiring a trial.
If there appears to be a genuine issue requiring a trial, based on the record before the judge, the judge should then determine if the need for a trial can be avoided by using the powers set out in Rule 16(6.1) of the Family Law Rules. These powers involve the weighing of evidence, evaluating credibility, drawing inferences, and possibly receiving oral evidence on the motion. The use of these powers is discretionary, provided that they do not run contrary to the interests of justice. Their use will not be against the interests of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.
The use of the expanded powers is not a full trial on the merits, but is designed to determine if there is a genuine issue requiring a trial.
There will be no genuine issue requiring a trial if the summary judgment process provides the court with the evidence required to fairly and justly adjudicate the dispute, and is a timely, affordable and appropriate procedure.
The Supreme Court of Canada also set out the following:
(a) Summary judgment rules must be interpreted broadly, favouring proportionality and fair access to the affordable, timely and just adjudication of claims.
(b) Undue process and protracted trials, with unnecessary expense and delay, can prevent the fair and just resolution of disputes.
(c) The summary judgment motion is an important tool for enhancing access to justice, because it can provide a cheaper, faster alternative to a full trial.
Where a summary judgment motion allows the judge to find the necessary facts, to apply the law to the facts and resolve the dispute in a just manner, proceedings at trial would generally not be proportionate, timely or cost-effective.
On a summary judgment motion, the evidence need not be equivalent to that at trial, but must be such that the judge is confident that the court can resolve the dispute fairly. A documentary record, particularly when supplemented by the new fact-finding tools, including ordering oral testimony, is often sufficient to resolve material issues fairly and justly. The extra powers provided can provide an equally valid, if less extensive, manner of fact finding.
The inquiry into the interest of justice is, by its nature, comparative. Proportionality is assessed in relation to the full trial. It may require the motion judge to assess the relative efficiencies of proceeding by way of summary judgment, as opposed to trial. This would involve a comparison of, among other things, the cost and speed of both procedures. It may also involve a comparison of the evidence that will be available at trial and on the motion as well as the opportunity to fairly evaluate better evidence that would be available at trial.
The principles in Hryniak have been applied to summary judgment motions in family law cases since the amendments to Rule 16 of the Family Law Rules became effective on May 2, 2015.
It is also necessary to consider sub rule 2(3) of the Family Law Rules, to ensure that a case is dealt with justly, by ensuring the procedure is fair to all parties, saves time and expense and that the case is dealt with in ways that are appropriate to its importance and complexity.
The responding party must put their "best foot forward" or risk summary judgment being awarded against them. The evidentiary burden is on the responding party to present affidavit material or other evidence to support the allegations or denials in their pleading. Absent of this evidence, an adverse inference can be drawn.
Analysis
65The predominant issue in this case is the proper characterization of the advances made by the respondent’s parents over the course of their 37 year marriage.
66The parties are agreed, based on the record before the court, on the following facts:
(a) the advances from the respondent’s parents permitted the parties to acquire the various investment accounts which they held individually, jointly or with one or more of their children, at or shortly before their separation;
(b) the income earned on the investment accounts from time to time, consisting of interest, dividends and capital gains, were used to by the parties to sustain them and their children financially after the respondent ceased working in 1994, as neither of them had any other means of support, subject to the applicant working part-time as a piano teacher giving private lessons towards the end of the relationship, and the parties renting out rooms in their residence from time to time;
(c) the parties both reported the income on the investment accounts for tax purposes. There is no indication that either of the respondent’s parents reported the income for tax purposes;
(d) the respondent’s parents never called upon the parties to pay over to them or to return any part of the capital or income in the investment accounts until following the separation when the respondent’s mother Lillian Chao called upon the respondent to pay the accounts, or the proceeds of their disposition, to her after she learned that the applicant withdrew approximately $32,000 from a joint account;
(e) no contemporaneous documentation exists evidencing or explaining the various advances. In particular, there are no promissory notes, loan agreements, trust declarations or agreements, nor are there cancelled cheques showing which of the parties the advances were made to. Neither party suggested that any promissory notes, loan agreements or trust agreements ever existed; and
(f) the respondent managed the investment accounts alone, making all decisions respecting the acquisition and disposition of investment assets. There was no suggestion that his parents at any time gave any directions with respect to the investments, nor that they ever requested any information respecting the investment accounts or their performance.
67It is noteworthy that neither the applicant, the respondent, nor the respondent’s mother Lillian Chao gave evidence of any verbal agreements, representations, expressions of intent or discussions between either of the respondent’s parents and one or more of the parties surrounding or touching upon the advances. The evidence of each of the affiants regarding the intentions of the respondent’s parents in making the advances consist of assumptions, understandings or conclusions of what was intended by the parents, rather than indications of what one or more of the parties may have said at the time.
68The applicant deposes in her Affidavit of August 26, 2016 that “I repeat and rely on my position that any and all funds that we received from the Respondent’s parents ought to be classified as gifts to the respondent and I.” Nowhere in her affidavit material did the applicant state that she ever heard either of the respondent’s parents express that they were making gifts to her and the respondent, or at all.
69For his part, the respondent deposed that in 1975 his parents paid half the cost of the purchase of the parties’ first home and that “there was an understanding” between the applicant, his parents and himself that whenever the house were sold half the proceeds would be returned to them. He never asserted that anyone ever expressed this understanding verbally or in writing.
70The respondent deposed that his mother was “happy to support me financially” and that his parents “often helped with our large expenses”. He stated in a conclusory way that the investments being contested “came from my parents’ money, placed in our names and our children’s names” during his period of unemployment during the last 19.5 years of the marriage, and that the income on the investments was used to pay the majority of the living expenses for the family. At no point did the respondent relate anything that his parents said to him respecting their intentions in making the advances.
71As mentioned by counsel for the applicant, the respondent, who was self-represented at the time of the filing of its filing his Answer, did not specifically plead that the various investments held by the parties were subject to a resulting, constructive or express trust in favour of his mother Lillian Chao. Lillian Chao did not seek party status in the proceeding, nor did she, as far as I have been informed, commence an action against either or both of the parties advancing a trust claim or otherwise. However the respondent did assert in the recitation of the facts in his Answer as follows:
(a) “all our accounts are in joint names. We received the income from my parents’ investments to pay for the living expenses of our family of six”;
(b) “[the sizeable investments] are my parents’ money placed under our names when I was unemployed… We received the income from my parents’ investments to pay the majority of the living expenses for our family of six”; and
(c) “my wife knew that these investments belong to my parents.”
72The focus of the litigation is largely been on the issue of the characterization of the advances made by the respondent’s parents, namely whether some or all of the investments are subject to a resulting trust in favour of Lillian Chao, whether there are amounts owing by the parties to her as debt, or whether the advances constituted gifts, and if so, to whom.
73Rules 2(2) and 2(3) of the Family Law Rules directs the court to deal with cases justly, ensuring that the process is fair to all parties and that expense and time are not wasted. It is clear that notice was given to the applicant in his Answer of the respondent’s claim that the investments belonged and continue to belong to his mother, notwithstanding that he did not specifically plead that they were subject to a resulting trust. It is therefore appropriate to deal with the respondent’s trust claim even though he did not necessarily advance it by name.
74In the recent case of Barber v. McGee, 2015 ONSC 8054 (S.C.J.) D.F. Fitzpatrick, J. conducted a very useful review of the law relating to the doctrine of resulting trust in the context of a case, not unlike this one, involving in advance of monies by a parent to a couple in a marriage relationship. Justice Fitzpatrick began his review by considering the explanation of the doctrine of the presumption of resulting trust by the Supreme Court of Canada in the case of Pecore v. Pecore, 2007 SCC 17 at paras. 24-25, as follows:
The presumption of resulting trust is a rebuttable presumption of law and general rule that applies to gratuitous transfers. When a transfer is challenged, the presumption allocates the legal burden of proof. Thus, where a transfer is made for no consideration, the onus is placed on the transferee to demonstrate that a gift was intended: see Waters' Law of Trusts, at p. 375, and E. E. Gillese and M. Milczynski, The Law of Trusts (2nd ed. 2005), at p. 110. This is so because equity presumes bargains, not gifts.
The presumption of resulting trust therefore alters the general practice that a plaintiff (who would be the party challenging the transfer in these cases) bears the legal burden in a civil case. Rather, the onus is on the transferee to rebut the presumption of a resulting trust.
75At para. 44 of Pecore Rothstein, J. observed that where a gratuitous transfer is being challenged “the trial judge will commence his or her inquiry with the applicable presumption and will weigh all of the evidence in an attempt to ascertain, on a balance of probabilities, the transferor's actual intention. Thus, as discussed by Sopinka et al. in The Law of Evidence in Canada, at p. 116, the presumption will only determine the result where there is insufficient evidence to rebut it on a balance of probabilities.”
76Some of the pertinent principles that emerge from the review conducted by Justice Fitzpatrick in Barber include the following:
(a) the presumption of resulting trust applies when a parent makes a gratuitous transfer to an adult child;
(b) the presumption is that the adult child is holding the property in trust for the parent; in other words, the parent holds an interest in subject asset whether it is real property, money loaned or some other item;
(c) the parent is presumed not to have intended a gift, however, this presumption can be rebutted by the evidence;
(d) the evidence necessary to result presumption depends on the facts of the case;
(e) evidence of the parent’s post-transfer conduct is admissible, so long as it is relevant to the parent’s intention at the time of the transfer; and
(f) a valid inter vivos gift is one that is intended to take effect during the lifetime of the donor. It consists of a voluntary transfer of property to another with the full intention that the property will not be returned. To establish a gift, one must show intention to donate, sufficient delivery of the gift, and acceptance of the gift (see Re Foley, 2015 ONCA 382 (C.A.) at para. 25)
77Justice Fitzpatrick, in conducting his review, did not draw a distinction between the factors and principles to be utilized in determining whether advances made by a parent were subject to a resulting trust or were loan advances. In my view this is not inappropriate. From the standpoint of attempting to ascertain the intention of the parent making the advances, the issue is whether the parent intended to retain a hold on the amounts advanced, regardless of whether that be by way of a resulting trust or a debt obligation..
78For example, Justice Fitzpatrick made reference to the British Columbia case of Byrne v. Byrne, 2015 BCSC 318, 57 R.F.L. (7th) 215 (B.C. S.C.) in which the court referenced the factors adopted by the Court of Appeal of that province (see Kuo v. Chu, 2009 BCCA 405, 180 A.C.W.S. (2d) 903 (B.C. C.A.)) that ought to be reviewed when determining whether a gift or loan was intended as follows:
a. whether there were any contemporaneous documents evidencing a loan;
b. whether the manner for repayment is specified;
c. whether there is security held for the loan;
d. whether there are advances to one child and not others or advances on equal amounts to various children;
e. where there has been any demand for payment before the separation of the parties;
f. whether there has been any partial repayment; and,
g. whether there was an expectation or likelihood of repayment.
79Justice Fitzpatrick made note of the approach taken by Mulligan, J. in Klimm v. Klimm, 2010 ONSC 1479, [2010] O.J. No. 968 (Ont. S.C.J.), where he noted the following factors, considered by Wood J. in Cade v. Rotstein, [2002] O.J. No. 4460 (Ont. S.C.J.), in determining the existence of a gift or loan:
a. that the debts are old, no demand has been made save one motivated by the separation of the parties;
b. the monies were advanced to the parties to help them out;
c. the parents who advanced the funds would not have looked for the money, nor have taken action against his son. This leads to the clear conclusion that the demand was made as a result of the separation and to benefit their son in a subsequent litigation;
d. the parent is elderly and in poor health;
e. the parent did not expect the money until the parties were able to afford to pay it back. The separation has made that an improbability; and,
f. the parent does not need the money.
80Justice Fitzpatrick also made note of Justice Mulligan’s consideration in Klimm, at para. 29, of the following words of Heeney J. in Poole v. Poole, 2001 28196 (ON SC), [2001] O.J. No. 2154, 16 R.F.L. (5th) 397 (Ont. S.C.J.), where he considered the role of fairness in the trust determination:
There is a compelling reason for taking this good hard look at the reality of the situation. A debt constitutes a credit in the equalization calculation, and reduces the net family property of the spouse claiming the debt. This has a direct impact on the equalization payment due, by either reducing the amount that the party has to pay to the other (if he has the higher net family property), or increasing the amount that he will receive (if his net family property is lower). Fairness dictates that he should not receive a credit for debt, with the financial benefits that flow from that credit, if he will never be called upon to pay the debt.
81Applying these principles to the case at bar, as observed above:
a. there were no contemporaneous documents evidencing a loan or any other hold placed on the amounts advanced by the respondent’s parents;
b. there is no evidence of any oral statements or representations made by either of the respondent’s parents with respect to the characterization of the advances at any time prior to separation;
c. there was no demand for repayment by the respondent’s mother until the separation;
d. the demand for payment by Lillian Chao on the respondent was triggered by the applicant withdrawing funds from a joint account following separation;
e. there was no evidence of any partial repayment to the respondent’s parents at any time prior to separation;
f. none of the income or capital gains earned on the investments was paid to the respondent’s parents;
g. there is no evidence that either of the respondent’s parents made any inquiries with respect to the parties’ investments, required any accounting of the investments or otherwise took any interest in the investments or their performance prior to separation;
h. the applicant and the respondent reported the income and capital gains on the investments derived from the advances for tax purposes. There was no evidence that the respondent’s parents reported any part of the income or capital gains;
i. the monies were advanced by the respondent’s parents to help the parties out;
j. the sum of $99,582, which the respondent says represents an outstanding loan advanced by his parents, comprised of $10,000 advanced in 2010, $6,300 in 2006, $73,282.40 in 2005 and $10,000 from 1999 to 2003, is old and there is no evidence of any realistic expectation of repayment of these amounts on the part of Lillian Chao.
82In my view there are no issues of credibility which would require a trial relating to the proper characterization of the advances made by the respondent’s parents. There is no real disagreement between the parties, or between the applicant and Lillian Chao, on what anyone said or did in relation to the advances and the investments. The disagreement between the parties relates to their subjective beliefs and assumptions which are largely irrelevant. A trial is not necessary to resolve the dispute about the parties’ subjective beliefs and assumptions.
83On a motion for summary judgment the responding party is required to “put his best foot forward” and, as a consequence, the court is entitled to assume that the evidence presented in response to the motion will be the responding party’s evidence at trial. There is no basis in this case to suggest that the evidence of the respondent will be any different or better at trial.
84I find that I am able to reach a fair and just determination on the merits of the applicant’s claim to entitlement to equalization in respect of the various investment accounts and necessary post-separation adjustments resulting from the respondent’s liquidation and dissipation of various accounts. This determination depends upon the proper characterization of the advances made by the respondent’s parents, based upon the affidavit material filed on the motion. The summary judgment process has allowed me to make the necessary findings of fact and to apply the law to the facts. I find that summary judgment is a proportionate, more expeditious and less expensive means to achieve a just result in relation to this issue. I am able to make a determination that there are no genuine issues requiring a trial relating to the characterization of the advances made by the respondent’s parents based only on the evidence before me, without using the fact-finding powers in sub-rule 16(6.1) of the Family Law Rules.
85Based upon all of the evidence before me I find that the presumption of resulting trust in favour of Lillian Chao has been rebutted. I also find that the various advances made by the respondent’s parents cannot be characterized as loans from them to the respondent. Based upon the evidence the reality of the situation is that there never was any expectation, prior to the parties’ separation, on the part of Lillian Chao that the respondent and the applicant would be required to repay any portion of the funds advanced by her and her husband. On the authority of Poole v. Poole, it would be unfair to permit the respondent to receive a credit for a debt to his mother, with the financial benefits that would flow to him from that credit on the equalization calculation.
86It is observed that it is not always necessary for the party opposed to a finding of resulting trust to lead affirmative evidence of donative intent on the part of the donor to rebut the presumption. As pointed out of Rothstein, J. in Pecore the court starts with the presumption of resulting trust and then weighs the all of the evidence to try to ascertain the donor’s actual intent. I adopt Justice Fitzpatrick’s comment at para. 71 of Barber that “although somewhat counterintuitive, allowing the presumption of resulting trust is to be rebutted by the factors identified in Klimm and Byrne is more likely to facilitate justice than requiring affirmative evidence of donative intent. To require more from the party challenging the presumption would induce the mischaracterization of gifts.”
87With respect to the moneys advanced by the respondent’s parents early in the marriage to assist the parties to purchase first one and then a replacement matrimonial home, even if it might be argued that the advances were made to the respondent, and not to both parties, under s. 4(2) (5) of the Family Law Act, R.S.O. 1990, c. F.3 they lost their status as excluded assets (see Ward v. Ward, 2012 ONCA 462 (C.A.) at para. 73).
88With respect to the property located on Erbsville Road, I find that the respondent has established, on a balance of probabilities, that he no longer had any beneficial interest in this property on the date of separation. The respondent has led affirmative evidence that the registered title to the property was not reflective of the beneficial ownership. He deposed that he has held no interest in the property since 1990. The applicant had no evidence to refute the respondent’s evidence, relying only on the registered title, which in my view is not determinative of beneficial ownership for the purposes of the equalization determination in the circumstances of this case. There are no credibility issues on this question which will require a trial to resolve.
89The applicant, in her affidavit of August 26, 2016, abandoned any claim to division of the parties’ jointly acquired household items and furnishings and filed an Amended Net Family Statement August 26, 2016.
90Following the transfer of the applicant’s interest in the matrimonial home to the respondent, the assets which the applicant claims require equalization as set forth on her Amended Net Family Property Statement, include the following:
(a) Erbsville Road Property – respondent’s interest $231,666.66
(b) Silver – respondent’s interest $33,310
(c) Gold – Gold ingots/coins – respondent’s interest $10,625.10
(d) Bank accounts, savings and securities - applicant’s interest $83,499.77; respondent’s interest $1,234,804.93 (based on information which the applicant says is available to her, including accounts disposed of or dissipated by the respondent prior to and after separation)
91The amount that the applicant claims for equalization (including adjustments arising from the dissipation of assets by the respondent) is the sum of $713,453.46.
92As indicated above, I am not satisfied that the respondent had a beneficial interest in the Erbsville Road property at the date of separation. I am also not satisfied, on a balance of probabilities that the gold is still in existence and is in the possession of the respondent. I am satisfied that the presumption of resulting trust in favour of the respondent’s mother has been rebutted in respect of the silver for the reasons set forth above. I find that the silver in the possession of the respondent were gifted to the parties jointly by the respondent’s parents and are subject to equalization.
93The evidence with respect to the bank and investment accounts is far from satisfactory. However, this is primarily due to the failure of the respondent to provide full and proper documentary disclosure of the details of the accounts as required by the Family Law Rules. The respondent states that he has exhausted his efforts locate pertinent information and maintains that he is unable to provide more complete disclosure of the nature, extent and value of the accounts before he began disposing of them, the details of amounts realized upon their disposition and the amounts paid over to his mother. It cannot therefore be anticipated that the evidence respecting the accounts and the proceeds of their disposition will be more complete or reliable at trial. Under these circumstances I am able to fairly and justly adjudicate the dispute in relation to the parties’ entitlements in respect of the bank and investment accounts on the motion, and to do so represents a more timely, affordable and appropriate procedure than a trial.
94The respondent’s Financial Statement excludes the bank and investment accounts which he acknowledges having dissipated and paid over to his mother Lillian Chao. It was, in my view, improper and precipitous for the respondent to use self-help to liquidate assets belonging to the parties and to pay over substantial proceeds to his mother before it was determined whether the assets constituted matrimonial property and subject to equalization.
95The property requiring equalization comprises the bank and investment accounts set forth in the applicant’s Amended Net Family Property Statement, which constitutes the best evidence of the extent of those accounts as well as the gold ingots/coins. I find that the amount owing by the respondent to the applicant in respect of equalization is the sum of $592,308.
Spousal Support
(a) Guiding Principles Respecting Spousal Support
96It is well established that there are three grounds for entitlement to spousal support (1) compensatory support, which primarily relates to the first two objectives set forth at sub-section 15.2(6) of the Divorce Act; (2) non-compensatory support which primarily relates to the third and fourth objectives; and (3) contractual support see Chutter v. Chutter 2008 BCCA 507, [2008] B.C.J. No. 2398 (BCCA) at para. 47, citing Bracklow v. Bracklow, 1999 715 (SCC), [1999] 1 S.C.R. 420 at para. [15 and 41-42].
97S, 15.2 of the Divorce Act R.S.C. 1985, c. 3 (2nd Supp.) identifies the objectives of an order for spousal support at sub-paragraphs (a) to (d) stating that such an order should:
(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;
(b) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;
(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and
(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.
98It is also well-established that there is no single basis of support or objective under the Divorce Act that supersedes the other and that many claims involve aspects of both compensatory and non-compensatory principles. The court is not called upon to decide on one basis of support to the exclusion of the other but rather “to apply relevant factors and strike the balance that best achieves justice in the particular case” see Chutter at para. 49 quoting Bracklow at para. [32].
99The Ontario Court of Appeal in the case of Cassidy v McNeil 2010 ONCA 218, [2010] O.J. No 1158 at para. 69, footnote 7, cited the SSAGs in explaining the concept of economic merger at para 7.2 as supporting an “entitlement to non-compensatory support, which arises whenever a lower income spouse experiences a significant drop in standard of living after marriage breakdown as a result of loss of access to the other spouse’s income, with amount and duration resolved by an individual judge’s sense of fairness.”
100A useful analytical categorization of the types of compensatory support was laid out by A.A. Mamo in his Annual Review of Family Law, 2007 (Toronto: Thomson Carswell, 2007) at p. 331, quoted by Justice G.A. Campbell in the case of Beneteau v. Young [2009] O.J. No. 3244 (SCJ) at para. 194 as follows:
i. non-specific compensatory support (where a spouse's ability to achieve self-sufficiency was comprised by career/job dislocation for the family); Walsh v. Walsh, 2006 CarswellNB 582 (Q.B.);
ii. specific calculable disadvantage (where a spouse can point to a specific calculable overriding loss resulting from the marriage or the roles adopted in marriage) Spurgeon v. Spurgeon (2001), 2001 38738 (ON SC), 15 R.F.L. (5th) 440 (Ont. Div. Ct.);
iii. specific calculable advantage conferred (where a spouse conferred a substantial career enhancement opportunity on the other spouse): Caratun v. Caratun (1992), 1992 7715 (ON CA), 42 R.F.L. (3d) 113 (Ont. C.A.).
(b) Analysis
101The applicant claims spousal support on both a compensatory and non-compensatory basis. Although not alluded to in her affidavit of July 14, 2016 filed in support of her motion for summary judgment, in her reply affidavit of August 26, 2016 the applicant deposes that her opportunities to pursue a career teaching piano were limited during the marriage given the responsibilities she took on to their parties’ four children, the respondent and their home.
102As indicated above, the applicant points to the respondent’s and her reported incomes for 2011 as representative of the income disparity between them.
103The respondent, for his part, submits that he is the party in need of support from the applicant. He says that his combined monthly income from his workplace pension, Canada Pension Plan and Old Age Security of $1,092.36 is less than the income of the applicant, and whereas the applicant has support from her mother and the parties’ children, he only has his mother’s support.
104The jurisprudence has indicated that in circumstances where a spouse has incurred specific compensable economic loss from the relationship or has conferred an identifiable economic advantage on the other spouse, entitlement to compensatory support to redress the specific loss incurred or benefit conferred should follow, even if the claiming spouse is self-sufficient, so long as the property division or other benefits received during the marriage have not fully compensated her or him for the loss or benefit. Accordingly a compensatory claim to spousal support is not dependent entirely on need.
105Each case, of course, must be decided on its own facts. In the unique circumstances of this case, neither party worked outside the home from the last 19.5 years of the marriage to provide for their and their children’s support. They were content to rely upon the largesse of the respondent’s parents who provided them with sizeable gifts which they invested to generate income. There is no evidence that the decision to arrange their lives in this fashion was made other than consensually. Neither party suffered economic disadvantage from the marriage. The applicant did not, at least in the latter 19.5 years of the marriage, sacrifice her own career prospects to permit the respondent to pursue career ambitions of his own which would have put him in an advantageous position to earn income post-separation. If anything, from an economic standpoint the applicant benefitted significantly from the marriage by sharing in the advances made by the respondent’s parents, and by the appreciation in value of the investments generated by those gifts.
106In the case of Sodhi v. Sodhi 2014 BCSC 1622 (B.C.S.C.) Grauer, J. stated at para. 85:
The leading cases concerning proper application of the principles set out in this section [s. 15.2 of the Divorce Act] are the judgments of the Supreme Court of Canada in Moge v. Moge, 1992 25 (SCC), [1992] 3 S.C.R. 813 (S.C.C.), and Bracklow v. Bracklow, 1999 715 (SCC), [1999] 1 S.C.R. 420 (S.C.C.). Those cases do not support either party's claim, whether analyzed on a compensatory or a need basis. Neither party suffered economic disadvantage from the marriage, and any economic hardship on the part of Mr. Sodhi arises not from the breakdown of the marriage, but from his own failure to perform his job as a Sheriff satisfactorily quite independent of any action on the part of Ms. Sodhi. Neither party sacrificed his or her career for the benefit of the career of the other. Both parties have sufficient assets and income earning capacity, as well as other resources, to achieve and maintain economic self-sufficiency. Both claims for spousal support are accordingly dismissed.
107These observations are, to a large extent, applicable to the case at bar.
108The respective incomes of the parties during the marriage were derived from the investments originated with the respondent’s parents’ gifts augmented by rental income from the matrimonial home, half the purchase price of which was gifted by the respondent’s parents.
109It is clear from the evidence that the respondent had no capacity, by reason of his age and ill health, to earn income from his own efforts on the date of separation, and continues to lack any such capacity.
110Given that the parties’ incomes during the marriage were almost exclusively derived from their investments, the only means available to equalize their standards of living following separation is to equalize their net family property. Once the property is equalized, there is no entitlement to either party to ongoing spousal support from the other, whether by periodic payments or in a lump sum.
111However, the respondent unilaterally liquidated most of the assets and paid over the proceeds to his mother, thereby depriving the applicant of the income that would have been generated by her equalized share of those assets. In my view pending equalization the applicant should be imputed income on the full amount that would have been in his hands had he not paid it over to his mother in the sum of $1,234,804.93, as estimated in the applicant’s Net Family Property Statement. Based upon a modest rate of return of 1.5% per annum, $18,522.06 in income would have been notionally generated on those investments. In his affidavit of August 11, 2016 the respondent deposed that his monthly workplace pension, CPP and OAS benefits comprise $1,092.36 per month. It is not evident from the material when he began drawing CPP and OAS. Doing the best that I can on the available evidence, I would impute income to the respondent for the period from separation to the present, based upon what he should have earned on the dissipated investments and his monthly workplace pension of $279.56 per month, at $21,876.78.
112The applicant’s affidavit of July 14, 2016 disclosed that she had reported income for the years following separation, as follows:
2012 - $6,587.00
2013 - $6,793.22
2014 - $10,168.00
2015 – 15,228.03
113The average of the applicant’s reported income post-separation is $9,694.06. To this I would add for consistency notional income of 1.5% on the $83,499.77 in investments that the applicant retained in the sum of $1,252.50 per annum, for a total average imputed income to the applicant in the sum of $10,946.55.
114Based on the SSAGs, the respondent’s post-separation support obligation on this basis would range between $505/mo. to $674/mo. I would determine the respondent’s support obligation to the applicant for the period August 1, 2012 to December 1, 2016 at $590/month or $30,680.00 in the aggregate for that period. The applicant acknowledges having received $3,000 from the respondent on account of support for a net amount owing by the respondent to the applicant of $27,680.
115In my view there is no genuine issue requiring a trial respecting the parties’ respective spousal support obligations and I am able to make a fair and just adjudication of the dispute between the parties on the issue. Moreover, to make the adjudication on the present motion is a timely, affordable and appropriate procedure. I am able to make the determination that there are no genuine issues requiring trial relating to the spousal support issue based only on the evidence before me, without using the fact-finding powers in sub-rule 16(6.1) of the Family Law Rules.
Pre-judgment Interest
116The applicant is entitled to pre-judgment interest on the amounts found to be owing to her for equalization and spousal support pursuant to section 128 of the Courts of Justice Act, R.S.O. 1990, c. 43 The respondent does not dispute the applicable interest rate under the Courts of Justice Act proposed by the applicant of 1.3 %.
117The amount owing to the applicant in respect of pre-judgment interest on the equalization payment amount of $592,308 for the period August 1, 2012 to date is the sum of $33,795.62.
118Given that the respondent’s obligation for spousal support was periodic, extending from August 1, 2012 to date, I would reduce the calculation of pre-judgment interest on the aggregate sum of $27,680 by 50% to $999.66.
Vesting Order
119The applicant seeks a vesting order in her favour over the former matrimonial home municipally known as 20 Glenworth Road, North York, Ontario (the “property’) to satisfy
120In the recent case of Wehbe v. Whebe, 2016 ONSC 1445 (S.C.J.) A. Doyle, J. undertook a useful review of the law in respect of claims for vesting orders to enforce orders for equalization and support.
121At paragraphs 406 to 410 Justice Doyle held that a vesting order cannot issue to a payee for the payment of spousal lump sum or arrears. She considered herself bound by the case of Trick v. Trick (2006) 83 R.R. (3d) 55 (Ont. C.A.) in which the Court of Appeal held that s. 100 of the Courts of Justice Act is not a stand-alone remedy. She noted the reasoning of Blair, J.A. in Lynch v. Segal 2006 42240 (ON CA), [2006] O.J. No. 5014 (C.A.) which suggested that s. 100 should be interpreted as flexible and elastic, but also noted that in that case the vesting order was granted under the Family Law Act. Justice Doyle found there to be no authority under the Divorce Act to make a vesting order with respect to spousal support, adopting the reasoning in Cunningham v. Montgomery 2010 ONSC 1817 (Ont. S.C.J.), that a vesting order cannot be made with respect to an order for spousal support payment or support arrears which is not made under the Family Law Act.
122However, Justice Doyle granted a vesting order in respect of real property in favour of the wife in that case to satisfy or partially satisfy an order for equalization in circumstances the husband demonstrated a constant lack of cooperation and non-compliance with court ordered payments, and where a vesting order in favour of the wife of the subject property was required to ensure that he complied with his financial obligation of making his equalization payment arising from the court’s judgment.
123S. 9 of the Family Law Act confers certain powers on the court to enforce a determination of a party’s entitlement to equalization under s. 5. Sub-paragraph 9(1)(d) provides that the court may order that property be transferred to, or vested in, a spouse, if it is appropriate to do so to satisfy an obligation imposed by the order (emphasis added).
124No specific evidence was led respecting the fair value of the property, nor with respect to the existence of any encumbrances against the property or the amount outstanding in respect of any such encumbrances. Accordingly, the equity of the respondent in the property is unknown.
125The evidence indicated that after separation the parties agreed on a value of the property at $780,000.00 The amount owing to the applicant in respect of equalization and pre-judgment interest thereon is $626,103.62. If the current value of the respondent’s equity in the property is equal to or greater than $790,000 it would be inappropriate and unfair to the respondent to vest the property in the applicant to satisfy an obligation in a lesser amount.
126However, sub-paragraph 9(b) of the FLA gives the court the power to order that security, including a charge on property, be given for the performance of an obligation imposed by the order.
127In my view, it light of the respondent’s demonstrated history of not complying with the Family Law Rules and with orders of the court in respect of disclosure and answering undertakings and proper questions asked on discovery, using self-help in liquidating and dissipating matrimonial assets prior to a determination of entitlement to those assets, forging the applicant’s signature in order to facilitate the liquidation of at least one investment account, transferring the proceeds of the dissipated assets to his mother out of the jurisdiction, and in light of the fact that the respondent has no other means to satisfy the equalization order, it is necessary and appropriate that security be granted to the applicant over the property for performance of the respondent’s obligation. (see Lynch v. Segal 2006 42240 (ON CA), [2006] O.J. No. 5014 (C.A.) at para. [32]](https://www.minicounsel.ca/oca/2006/42240#par32).
128The parties are encouraged to agree upon the terms of security to be granted by the respondent to the applicant over the property in respect of the equalization payment, and pre-judgment interest and post-judgment interest thereon and to arrange for the registration of that security against the property. In the event that the parties cannot agree on the terms of the security and its implementation, they may make arrangements with the Trial Coordinator at Kitchener to re-attend before me, upon the filing of appropriate materials, to settle the terms of an order for security under sub-rule 9(1)(b) of the FLA. Any such security shall be subject to existing encumbrances, liens, executions or charges against the property. In the event that it is necessary to re-attend before me, as aforesaid, the filed material shall include a copy of the parcel register in respect of the property, containing a full legal description of the property, and full particulars of any existing encumbrances, liens, executions or charges against the property.
Disposition
129For the reasons set forth above, it is ordered as follows:
(a) the respondent shall pay to the applicant in respect of equalization under sections 5 and 7 of the Family Law Act the sum of $592,308;
(b) the respondent shall pay to the applicant in respect of pre-judgment interest on the said sum, pre-judgment interest pursuant to s. 130 of the Courts of Justice Act, in the sum of $33,795.62;
(c) the respondent shall pay to the applicant in respect of arrears of spousal support to the date hereof the sum of $27,680;
(d) the respondent shall pay to the applicant in respect of pre-judgment interest on the said sum for arrears of spousal support, pre-judgment interest pursuant to s. 130 of the Courts of Justice Act, in the sum of $999.66;
(e) the applicant’s claim for ongoing periodic or lump-sum spousal support from and after this date is dismissed;
(f) the respondent’s claim for spousal support is dismissed;
(g) the respondent shall grant security pursuant to sub-paragraph 9(1)(b) of the Family Law Act to the applicant over the property municipally known as 20 Glenworth Road, North York, Ontario in respect of performance of his obligation to pay the amounts referred to in sub-paragraphs (a) and (b) above, together with post-judgment interest on the amount payable by sub-paragraph (a), pursuant to the Courts of Justice Act. Such security shall be subject to any existing encumbrances, liens, executions or charges against the property; and
(h) in the event that the parties cannot agree on the terms of the security and its implementation, they may make arrangements with the Trial Coordinator at Kitchener to re-attend before me, upon the filing of appropriate materials, to settle the terms of an order for security under sub-rule 9(1)(b) of the Family Law Act.
Costs
130Counsel are strongly encouraged to agree on costs. If they are unable to do so, they may deliver written submissions on costs – the applicant by January 16, 2017 and the respondent by January 30, 2017. Such submissions shall not exceed five (5) double-spaced pages, exclusive of bills of costs or costs outlines and offers to settle. The applicant may deliver brief reply submissions, not exceeding three (3) double-spaced pages, within seven (7) days of receipt of the respondent’s submissions. All submissions shall be delivered to my chambers at 85 Frederick Street, 7th floor, Kitchener, Ontario N2H 0A7
131In the event that no submissions are received within the times set forth above, the parties shall be deemed to have settled the issue of costs.
D.A. Broad, J.
Date: December 20, 2016