COURT FILE NO.: FC-08-1090-03 DATE: 20170210 SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Rueben Lapshinoff, Applicant AND: Christy Michelle Allen, Respondent
BEFORE: THE HONOURABLE MR. JUSTICE J.P.L. McDERMOT
COUNSEL: L. Mongillo, Counsel, for the Applicant Kim Kieller, Counsel, for the Respondent
HEARD: February 9, 2017
ENDORSEMENT
Introduction
[1] This is the Applicant’s motion to stay child support. The basis of the request is that the children of the marriage, Cole who is 15 and Owen who is 14, have decided to move in with him.
[2] Previously, the Applicant and the Respondent had shared custody of the children. This was a long-term arrangement since the parties separated 8 years ago. The latest iteration of this arrangement is under my order of November 2, 2012. That order called for a week about rotation with exchanges between the parties on Wednesdays. Until recently, the children and the parties lived in Barrie and the children attended public school in Midhurst.
[3] Mr. Lapshinoff says that in 2015, Owen began agitating to live with him because his mother was not sufficiently involved in his care and schooling. According to Mr. Lapshinoff, Owen complained that Ms. Allen would sleep in and would fail to prepare breakfast or school lunches. Mr. Lapshinoff’s evidence was that the children had to hunt down clothing in the morning and received no help with their homework. There is some corroboration for this contained in the texts from Owen attached as an exhibit in Mr. Lapshinoff’s September 1, 2016 affidavit.
[4] When Mr. Lapshinoff raised this issue with Ms. Allen, the parties agreed to get Daniel Musselman involved in place of the named parenting coordinator under the last court order, Ms. Chouinard. Apparently, Mr. Musselman confirmed Owen’s views and preferences, but was unable to complete his mandate because Owen refused to continue seeing him.
[5] However, in October, 2015, the parties did agree eventually to a solution that Mr. Lapshinoff has always wanted, which was to place the children in a private school. The parties chose St. Andrews College in Newmarket (“SAC”). The evidence satisfies me that there was an agreement to this effect although the Respondent now suggests that she was forced into this: however, there are texts from the Respondent to the Applicant offering to assist in the application which confirms to me that she acquiesced in this decision.
[6] The Applicant agreed to pay the costs of SAC. According to counsel, these costs are steep, some $38,000 per child per year. The fees for the 2016-17 year may have been paid by Mr. Lapshinoff through his line of credit; at least that can be inferred from the fact that the line of credit has increased by more than $70,000 since his initial financial statement was sworn in August, 2016.
[7] The parties did not agree on two issues, which resulted in yesterday’s motion. The parties did not agree to a change in the shared custody arrangement. They also failed to agree that Mr. Lapshinoff’s child support would come to an end.
[8] Mr. Lapshinoff is an investment advisor and he is in the top 1% of income earners, making about $300,000 per annum more or less. Ms. Allen makes a much more modest income of about $26,000 per year from disability insurance. Based upon differential support payable according to the parties’ incomes and the shared arrangement, Mr. Lapshinoff has always paid in excess of $2,000 per month and continues to do so. Under my order of November 2, 2012, differential child support was $2,485 per month; this amount has been adjusted on a year to year basis by the parties according to their incomes and pursuant to the terms of the order which allows for a review each May.
[9] This is notwithstanding the fact that the children have now “voted with their feet.” Mr. Lapshinoff moved to Newmarket and obtained a residence which allows the children to attend SAC as “day boys.” According to Mr. Lapshinoff, they now refuse to adhere to the shared arrangement agreed to by the parties in 2012 and have moved in with him full time.
[10] This occurred after the parties continued to share custody throughout the summer of 2016. They then scheduled a four-way meeting on August 22, 2016. Apparently, Mr. Lapshinoff had thought that the change in schooling meant that the children would reside primarily with him because Ms. Allen continued to live in Midhurst. At the four-way meeting, however, Ms. Allen announced that she was now moving to Newmarket to continue the shared custody arrangement. Soon after this, the children indicated that they were not willing to move in with their mother and apparently, as a bargaining tool, the Respondent threatened to revoke her consent that the children attend at SAC.
[11] On September 7, 2016, there was, according to Mr. Lapshinoff, a difficult meeting between the children and their mother which he characterizes as an “alienation attempt” by Ms. Allen. This resulted in the children becoming angry at Ms. Allen and refusing to see her. On October 19, 2016, Ms. Allen showed up at SAC to pick up the children for the custody change that she was entitled to under the shared arrangement; the children ran and hid. The police were called and after some negotiation involving the children, the police and the parents, the parties agreed that the children would reside with Ms. Allen two weekends out of three and would otherwise reside with Mr. Lapshinoff. Since the end of August, 2016, the children have been living primarily with the Applicant and they see the Respondent two out of three weekends, except for holidays where the children will reside mostly with the Respondent. The children continue to attend at SAC.
[12] The children are, by all accounts, extremely intelligent and mature for their ages, although they have some special needs. They are, according to Mr. Lapshinoff, excelling at SAC. Cole is a straight A student and Owen consistently achieves a B average. The Applicant says this is an improvement over their situation at their old school in Midhurst; Ms. Allen says that the children did well there as well.
[13] Mr. Lapshinoff now requests a stay of child support. The parties agree that this is to be treated in the same manner as a motion for an interim variation of child support.
[14] For the reasons set out below, there shall be a temporary order staying enforcement of child support.
Positions of the Parties
[15] There was some debate as to whether, under the arrangement arrived at, at SAC on October 19, 2016, the children spend 40% or more time with the Respondent based upon the time sharing during holidays. However, no calculation was provided to me and this issue was not argued. I therefore assume, for the purposes of this motion that the children now reside primarily with the Applicant.
[16] The Applicant has brought a motion to stay child support based upon the change in circumstances wherein the children now reside with him. He says that he can no longer afford child support on top of the fees for SAC. He says that if the child support continues to run, he will be unable to enroll the children in SAC for the coming school year. He says that it is absurd that he continues to pay child support when the children live with him full time and see their mother on weekends.
[17] The Respondent Mother says that it would be completely unfair to end child support. She says that the Applicant has taken trips to Europe and Maui and has purchased a bicycle for $6,000. The Applicant and his wife drive a pair of Audis. Ms. Allen points to his luxurious lifestyle and says that it would not be a hardship on the Applicant to force the payment of child support along with the fees. She says that the threat to pull the children out of SAC is hollow and will not be followed through on. She also says that, in reliance on the order, she had changed her position to her detriment, and obtained housing in Newmarket in order to continue with the week about arrangement as ordered. She says that the Applicant is guilty of bad faith conduct and has imposed his own views about her onto the children resulting in a change in their views and preferences. She also says this behaviour should not be rewarded with a stay of child support.
Analysis
[18] Both counsel agreed that this motion for a stay of child support would be dealt with in the same manner, and according to the same legal principles, as a motion for an interim variation of child support.
[19] Both parties also agreed that the case law confirms that an interim variation of child support can be ordered notwithstanding the lack of express statutory jurisdiction: see Dancsecs v. Dancsecs, [1994] O.J. No. 1070 (Gen. Div.) at para. 2 and Carter v. Carter, [1998] O.J. No. 4015 (S.C.J.) at para. 8. The real issue in this motion is whether the facts permit an order for an interim variation or, as requested in this case, elimination of child support.
[20] This would seem to be straight forward. If the children have moved in with their father, why should he have to continue to pay child support, especially in light of the school fees he is paying? For Ms. Allen, however, it is not so simple. As noted above, she says that she has made financial sacrifices in reliance upon the order in question, and says that if she loses child support, she will also lose her weekend time with the children as she will be unable to afford her second home in Newmarket. She notes that the children have numerous activities at SAC and would not be able to visit her at her residence in Midhurst. As well, she says that Mr. Lapshinoff is simply not eligible for a temporary variation of child support on the present state of the law regarding interim support variations.
[21] The law on interim variations of child support is well settled and is summarized by Mitrow J. in Clark v. Vanderhoeven, 2011 ONSC 2286. In that case, he summarized the five factors to be considered by the court in determining whether an order for interim variation should go:
i. The moving party must demonstrate a prima facie case on the merits. This would include, presumably, the moving party demonstrating a material change in circumstances;
ii. The moving party must come to court with “clean hands”.
iii. There must be a clear case of hardship or the continuation of the order must be demonstrated to be “incongruous or absurd.”
iv. To find that an order is incongruous or absurd, the continuation of support must be “inappropriate, unreasonable or ridiculous.”
v. The court should consider whether the need for a variation is “urgent.”
[22] I note that Mitrow J. points out that these are factors for consideration only; they are not necessarily absolute requirements for an order for an interim change in child support.
[23] There is clearly a change in circumstances. If the Applicant is telling the truth, Owen has been requesting a change in residence for more than a year. His views and preferences were confirmed by Daniel Musselman, and the police report makes it apparent that both children wish to reside with their father. In light of their ages and their clear views and preferences, I do not believe it can be argued that the Applicant has failed to demonstrate a change in circumstances or that there is a prima facie case warranting a change in custody. The real issues surround the factors set out in paragraphs 2 to 5 above.
Clean Hands
[24] The Respondent argues that the Applicant does not have “clean hands.” Ms. Kieller argues that the facts indicate that the concerns about the mother’s mental health as expressed by Owen were manufactured by the Applicant and “imposed” upon the children resulting in their views and preferences being the way they are. She also argues that the timing of the children’s decision to reside with their father was suspicious as it came immediately after a four-way meeting where the mother told the father that she was moving to Newmarket to continue with the shared arrangement once the children began attendance at SAC. Finally, she says that the police report confirms that the father was in breach of the order of Douglas J. made October 14, 2016 which required the parties to “encourage” that the children comply with the order in question.
[25] The difficulty that I have with this is that the issue of the children’s views and preferences is hotly contested in the father’s affidavit. He has provided an extensive history of the matter, which confirms that Owen, and to a lesser extent, Cole, have had concerns about their mother’s care for years. He says that he was concerned about these issues prior to the last consent order, but he felt that the shared arrangement in that order, which was extremely detailed and provided for a parenting coordinator, would allow him to address those factors. He has also provided text messages from Owen attached as Ex. G to his September 1, 2016 affidavit which confirm, to some extent, that Owen’s concern were independent of his father’s views: for example on January 15, 2015, he writes his father “Daddy I can’t do this; with mom”; this is the opening to the exchange and not in response to anything from his father. On April 9, 2015, Owen opens his text message with a statement to his father “I don’t want to be here” and then says in response to a question as to what was wrong, that his mother “seems upset and easily angered.” The texts seem spontaneous and even though there are some statements from the Applicant that seem inappropriate (later on January 15, Mr. Lapshinoff asks “Ugh, how do you feel about the weirdness at mom’s”), most of the questions and responses seem to be genuine and responsive to the child’s expressed concerns. The evidence is equivocal and I am not in a position to find that the Applicant is without clean hands based upon the views and preferences of the children, and in particular Owen, as expressed by him early on.
[26] As well, the parties have different versions of what took place in August and September of 2016. It does appear that Mr. Lapshinoff thought that the change in school meant that the children would be living with him, and he may very well have expressed this to the children prior to the four-way meeting that took place on August 22, 2016. That may have been an honest belief because it also appears that the parties had agreed to the children going to SAC and until the four-way meeting, the Respondent had not told the Applicant that she intended to obtain a residence in Newmarket. This was also only after the Respondent had a “long heart to heart conversation” with her lawyer. Ms. Allen only signed her lease for her Newmarket apartment on September 1, 2016.
[27] This being the case, the Applicant was not necessarily wrong in assuming that the custodial situation was going to change when the children went to SAC as, until the August 22 meeting, the Respondent was living in Midhurst and would not have been able to ensure the children’s attendance at SAC. The Applicant may have made the wrong assumption, but that does not mean that he is without clean hands or is guilty of misconduct.
[28] Justice Douglas ordered on October 14, 2016 that the parties encourage compliance with the shared custody regime. Ms. Kieller says that the Applicant is in breach of that order as evidenced by the police report concerning the incident five days later at SAC.
[29] The order of Douglas J. requires the parties to “encourage” compliance with the order, including through disciplining the children if necessary. There is a difference, however, between encouragement and the statement that the Respondent “would not force” the children to comply with the order as set out in the police report. I can take judicial notice of the fact that these children are 14 and 15 years of age, and it is difficult to force children of this age to do anything at all if they refuse to do so. Finally, considering that the mother had shown up, the boys had run away and indulged in risky behaviour and the police had been called, I have some sympathy with the Applicant’s statement that coercion at that point might very well cause “more damage.”
[30] As well, the Applicant deposes that the Respondent did not actually withdraw electronic privileges as he says he did as a result; she says that she received texts from the boys after the point that the Applicant says that the privileges were withdrawn. However, the Respondent does not attach those texts as exhibits to her affidavit or provide details of when the texts were actually sent.
[31] Finally, it appears to me that the Respondent is not wholly without blame. It was, in my view, irresponsible and reckless to go to the school to pick up the children when Ms. Allen knew that the children were refusing to come to her residence; it was also concerning that she called the police after her attendance precipitated the children “running away.” As well, the Respondent does not deny that she threatened to withhold her consent to the children attending at SAC at the four-way meeting in order to obtain the Applicant’s agreement to a continuation of the shared arrangement and support; that does not appear to be a position which is in alignment with the best interests of the children. Finally, the evidence appears to indicate that, although there was no agreement regarding the residence of the children, the Respondent did not take a clear position on that issue until the August 22 meeting after her “heart to heart” with her lawyer. Although I do not make a finding in this regard, the Respondent’s actions might be interpreted as being more concerned about continuation of child support at the expense of the children’s best interests.
[32] In sum, the evidence conflicts on the reasons for the children’s views and preferences, which appear to be as alleged by the Applicant. I cannot find clear and unequivocal evidence that there is alienating behaviour on the part of Mr. Lapshinoff or encouragement of the children to breach the shared arrangement, contrary to the order of Douglas J. The evidence also permits a finding that the Respondent is not blameless in the situation in which the children find themselves. The evidence therefore does not allow me to find on the balance of probabilities that the Applicant does not have clean hands or that he is in wilful breach of the shared custody order as suggested by Respondent’s counsel; that is a genuine issue for trial. I do not find that the Applicant is disqualified from an interim variation of child support by reason of misconduct.
Hardship
[33] According to the third requirement in Clark, the court must consider either the payor’s “hardship” or the issue of whether the continuation of child support would have an absurd result. Only one or the other is necessary. I intend upon considering both issues. I will first examine the hardship issue.
[34] Ms. Kieller says that the payor’s complaints of hardship are essentially “crocodile tears.” She says that, compared to the Respondent, the Applicant is extremely well off. She notes that the Applicant has income in the range of $300,000 plus a $50,000 annual addition to his income which results from the forgiveness of a $500,000 loan advanced as an incentive for him to bring his book of business to his present employer. She points to the Applicant’s luxury vehicles, his trips as well as expensive bicycles purchased by him all of which would more than pay several support payments to the Respondent.
[35] If we enter into a comparative exercise, there is no question that the Applicant has a much more luxurious lifestyle than the Respondent. The Respondent suffers from a disability and subsists on $26,000 per annum. There is really no comparison, and if child support comes to an end it will work a hardship on the Respondent.
[36] However, child support is for the children (Willick v. Willick, [1994] S.C.J. No. 94). Those children no longer live with the Respondent and what we are considering is a request by her that child support continue to be paid by the individual who also provides for almost all of the children’s needs. The issue of hardship has to be considered in light of the interest of meeting the children’s needs, which is, of course, the purpose of child support.
[37] Ms. Kieller could not refer me to any case where child support continued to be paid notwithstanding a move by the children into the residence of the support payor. Although she suggested that the lack of case law was because a change in residency was not a valid ground for varying child support, this might also be because parents have never thought it necessary to argue the issue where custody changed into the hands of the support payor.
[38] As well, there is a risk that the SAC fees will not continue to be paid by the Applicant if child support continues as an obligation. That is certainly the position of the Applicant. The Respondent says that this is an empty threat, and that the Applicant can well afford child support on top of the school fees.
[39] However, that is not apparent from the materials filed. The Applicant says that the $500,000 advanced by his new employer is now gone, and he has no liquid assets. His income is about $20,481 per month plus the $4,409 monthly to be added into his income as noted above, but that the latter amount is not cash in the Applicant’s hands; that is notional income on money that has been, according to the Applicant, already advanced and spent. But because of the additional income of $50,000 per annum, the Applicant is left with a tax bill of $10,946 per month, leaving the Applicant with about $9,545 per month, or $114,540 per annum in disposable income. If that is all that he has, the payment of $76,000 in school fees would leave Mr. Lapshinoff with $38,540 to live on. If support was paid on top of that, which is about $24,000 per year, Mr. Lapshinoff is then left with about $14,540 per annum, substantially less than what Ms. Allen would have in her hands. And again, this would appear to work a hardship considering the children are living in the Applicant’s home and the Applicant is left to pay for their primary expenses.
[40] I have noted that Mr. Lapshinoff is going to borrow the money for school fees, but he will eventually have to pay that back. I understand that Ms. Allen will also suffer hardship if the support stops, and she may have to return to Midhurst. Ms. Kieller says that she pays expenses for the children’s activities as well. However, it is clear that to expect Mr. Lapshinoff to pay both the school fees and support may very well work a hardship on both Mr. Lapshinoff and the children.
[41] Ms. Kieller suggests that ongoing support does not work a hardship in light of her client’s undertaking to place one year’s worth of support in Ms. Kieller’s trust account as security if repayment of child support is ordered. Ms. Allen says that she will do this from the net proceeds from her home in Midhurst which is being sold as a result of the breakdown of her second marriage.
[42] Apart from the issue of whether this is a promise that can be kept, that does not assist Mr. Lapshinoff now. It may assist him in the future, but I do not feel it fair to put the parties into a position of arguing these issues again. The children are living with Mr. Lapshinoff now because of their views and preferences which are strong and consistent to date. Even if Ms. Allen is successful in proving that the Applicant had influenced the children, as suggested, and was in breach of the Douglas J. order, that may very well not be sufficient to uproot the children from where they clearly want to be. At the moment, it is much more probable that the children will remain in the care of the father for the foreseeable future, and it does not alleviate hardship to make Mr. Lapshinoff pay ongoing child support on the basis that he can argue for its return in the future.
[43] Finally, this is not a spousal support issue. Relative standards of living and hardship are not relevant to the needs of the children and the issue of hardship. The issue is really whether there is a risk that the children’s needs will not be met under their father’s roof if child support continues and there is a risk that this could occur. I therefore find hardship to the payor, and as a result to the children, if an interim variation is not granted.
Absurd or Incongruous Result
[44] This has been partially covered by the discussion regarding hardship above.
[45] Ms. Kieller suggests that it would be an absurd result to deprive the Respondent of her apartment in Newmarket, which enables her to care for the children and exercise the access she says she was forced to accept when the children refused to adhere to the shared custody arrangement. She says as well that this is particularly odious where the Applicant was to blame for breaching the order.
[46] I have already spoken to my inability to make that that finding on the material filed in this motion. I have also spoken to the reason why there is no case law considering situations where children have moved in with a support payor who then seeks an interim variation. That is because, in my view, it appears clear that a party who is bearing the costs of the children should generally not be also asked to pay child support under the Divorce Act. That there is discretion in this case is clear: I can order a different amount than the table amount (which would result in Ms. Allen paying child support which is not requested) where the putative payor makes more than $150,000, or, for that matter, where the result would otherwise be inequitable: see s. 15.1(5) of the Divorce Act. However, considering the needs of the children, and their entitlement to stability and a certain lifestyle I do not find that it would be inequitable to grant the Applicant’s request.
[47] Finally, Ms. Kieller suggested that it was more important to the children to have meaningful contact with their mother than to continue to attend at SAC. I am not sure that the children would agree with that premise. These children have been through a lot. They have changed schools and may have to change schools again if child support continues. The new school would presumably be in the catchment area where the father lives, unless the views and preferences of the children change substantially in the next six months. They have also undergone a change in residency combined with what I see as a traumatic experience when the police were called to the school when Ms. Allen attempted to have them go home with her on October 19, 2016. I do not think it to be in the best interests of the children to be forced to change schools at this point in time, considering the history of the matter. This is particularly so where the children have some special needs and are doing well at SAC, according to the Applicant’s evidence. And I specifically take this into account in determining whether the order would work an absurdity or ridiculous result.
[48] I therefore find that the result would be incongruous if the stay is not granted, in light of the fact that child support is being requested from the Applicant who is bearing the vast majority of the children’s expenses.
Urgency
[49] The cases require urgent circumstances to permit an interim variation of child support: see Hayes v. Hayes, [2010] O.J. No. 2828 (S.C.J.) at para. 30 and Crawford v. Dixon, [2001] O.J. No. 466 (S.C.J.) at para. 14. Without urgency, an order should not go.
[50] Ms. Kieller says that the Applicant has acknowledged that the circumstances are not urgent. She points to a letter from the Applicant’s counsel where Mr. Mongillo says that, “The issue of support is not an urgent one and will not be the subject of a motion.” Ms. Kieller says that this acknowledgement of lack of urgency precludes an interim variation of child support.
[51] That letter was written on September 1, 2016 when the issue of a parental consent to SAC was in issue along with primary residence of the children. Those were urgent matters at that time, and arrangements are now in place to address those issues. Urgency is a relative issue, and the financial issues have now become urgent because of the need to register the children for next year. Mr. Lapshinoff says that he cannot both pay the fees and the ongoing child support. The time for registration of the children for the 2017-18 year is up and Mr. Lapshinoff says that he needs to know whether he can financially afford a further year for the children at SAC. He says that if he has to pay child support he cannot.
[52] Again, Ms. Kieller says that the issue of school fees is an empty threat and that Mr. Lapshinoff can easily pay both. I am not sure that is the case. There is a risk that the children will not be enrolled at SAC if child support continues. If they do not go back to SAC, this will harm the children in light of their performance at SAC, as well as the instability they have suffered from recently. Also, if they cannot go to SAC, I am concerned that they will blame their mother for this, resulting in further estrangement. I am not willing to take that risk.
[53] I find that the matters are sufficiently urgent to allow the court to entertain the stay application.
Result
[54] I therefore find that the circumstances of this case warrant an interim variation in child support. The needs of the children are affected by the Applicant’s ongoing child support obligation, and the children are presently in his primary care. It works an injustice that this is so, even taking into account the income disparities. The parties have agreed that the children attend at SAC and it would not be in the children’s best interests to retreat from this arrangement and place them in another school.
[55] I therefore find that a stay of child support is warranted in the present case based upon the change in residency of the children from a shared to a primary residential arrangement.
[56] There shall therefore be a temporary order to go that enforcement of child support under my order of November 2, 2012 be immediately stayed until further order.
[57] Ms. Allen complained that she will no longer be able to pay the costs of the children’s extracurricular expenses that she contributes to. In light of this decision, Mr. Lapshinoff should be paying those expenses if he is no longer doing so. The income discrepancy between the parties warrants this.
[58] Therefore, there shall also be a temporary order that the Applicant bear the entire cost of any of the children’s extracurricular activities that they are participating in at present.
[59] The parties may provide submissions as to costs on a ten-day turnaround, with the Applicant providing submissions first and then the Respondent. Costs submissions to be no more than five pages in length, not including bills of costs or offers to settle.
McDERMOT J. Date: February 10, 2017