CITATION: Smaggus v. Madonna, 2017 ONSC 6015

OTTAWA COURT FILE NO.: FC-17-411 DATE: 2017/10/06

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Jane Ann Smaggus, Applicant AND Domenic Franco Madonna, Respondent

BEFORE: Justice Engelking

COUNSEL: Wade L. Smith, Counsel for the Applicant D. Larry Segal, Counsel for the Respondent

HEARD at Ottawa: October 3, 2017

ENDORSEMENT

1This was a motion brought by the Respondent, Mr. Madonna for an order of increasing access to his children, Penelope Isobel Antonietta Madonna, born August 4, 2014, and Franco Andrew Madonna, born December 22, 2015. The Applicant has brought a cross-motion for on order for temporary child support, temporary spousal support, and for an interim disbursement to be paid by Mr. Madonna.

2For the reasons which follow, I am granting an order for access to Mr. Madonna. I am also granting an order for temporary child support and spousal support to be paid by Mr. Madonna to Ms. Smaggus. This will include a provision that his support obligations are to be secured by insurance. I decline to exercise my discretion to order that Mr. Madonna pay an interim disbursement for the engagement of an expert by Ms. Smaggus.

3There are five issues of significance in the motion. They are;

1. Is an order for increased and overnight access in the children’s best interests?

2. What is the appropriate quantum of child support payable by Mr. Madonna to Ms. Smaggus?

3. Does Ms. Smaggus have a prima facie claim for spousal support?

4. If so, what should the quantum of spousal support be?

5. Should the court make an order in favour of Ms. Smaggus for an interim disbursement?

Issue #1 – Is an order for increased and overnight access in the children’s best interests?

4The parties had a relatively short lived common law relationship (commencing in 2010 or 2013, depending on whose version you accept) during which the two children of the union were born in 2014 and 2015 respectively. The parties separated in April of 2016. At the time of separation, Mr. Madonna moved out of the jointly owned family home at 33 Bellfield Street, and according to his affidavits went to live firstly with his parents for a short period of time and then more recently with his new girlfriend. He asserts that it is still his intention to get a place of his own, but he does not currently have one. Ms. Smaggus remained in the family home with the children, although she attests to the fact that it is currently up for sale.

5Ms. Smaggus has been the primary caregiver to the children since the parties’ separation. In her materials, she attests to the fact that she has been the primary caregiver to the children since they were born, alleging that Mr. Madonna spent little time with them and showed little interest in them. Prior to separation, Mr. Madonna’s parents frequently cared for the children, particularly when both parents were working. They have continued to do so post-separation when Ms. Smaggus is working, which she now does part-time.

6Since separation, Mr. Madonna has seen the children two days during the week, usually at lunchtime, while they are at his parents’ home, and on Sundays from 11:00 am to 6:00 pm. Mr. Madonna’s evidence is that he has been seeking some extended and overnight access to the children for several months, and he has pointed to correspondence from his counsel to Ms. Smaggus’ counsel evincing this from March 30, 2017, April 6, 2017, June 16, 2017 and July 5, 2017. The only response he received to his request is by letter from Ms. Smaggus’ counsel to Mr. Madonna’s counsel dated August 21, 2017, offering him an overnight visit if he exercises it in the family, is alone and has nobody else attend. Ms. Smaggus’ rationale for this is that she does not believe that a) Mr. Madonna does any of the parenting of his children when they are with him (rather that he leaves that to his parents or girlfriend), and b) Mr. Madonna has no interest in parenting them.

7Whether Mr. Madonna was a hands-on parent when the parties were together, or whether he showed any interest in parenting them pre-separation, is not, and should not be, determinative of whether he can be permitted to parent the children post-separation. His interest in doing so is more than clearly demonstrated in his on-going requests to be given the opportunity to do. Absent any disqualifying evidence, for example that he presents a risk to them, he is entitled by the underpinnings of the Children’s Law Reform Act to do so.

8Ms. Smaggus has presented no evidence to suggest that Mr. Madonna has in any way mistreated his or any other children. Nor has she provided any third party evidence that this is the case. Mr. Madonna has sworn in his own affidavit as to the tasks he undertakes while caring for the children, and his father, Mr. Franco Madonna has also provided evidence to the same effect.

9Based on the evidence before me, I can see no reason why Penelope and Franco should not be spending more time, including overnight visits, with their father, Mr. Madonna. Because the children are young, and they have not yet stayed with Mr. Madonna, or away from Ms. Smaggus, I propose a gradual increase as follows:

(a) Mr. Madonna shall have access to Penelope and Franco from Saturday, October 7 at 9:00 am to Sunday, October 8 until 6:00 pm;

(b) Mr. Madonna shall have access to Penelope and Franco from Saturday, October 21 at 9:00 am to Sunday, October 22 until 6:00 pm;

(c) Commencing November 3, 2017, Mr. Madonna shall have access to Penelope and Franco every second weekend from Friday at an appropriate time agreed upon by the parties until Sunday at 6:00 pm;

(d) Commencing December 1, 2017, Mr. Madonna shall have access to Penelope and Franco every second weekend from Thursday at an appropriate time agreed upon by the parties until Monday morning at an appropriate time agreed upon by the parties;

(e) During the weeks immediately following his weekends, Mr. Madonna shall continue to have two daytime visits per week with the children;

(f) During the weeks following a non-access weekend, Mr. Madonna shall have one overnight access visit to Penelope and Franco on either a Tuesday night to Wednesday morning or Wednesday night to Thursday morning as agreed upon by the parties;

(g) The children’s vacation from Montessori over Christmas shall be equally shared by Ms. Smaggus and Mr. Madonna. They may come to an agreement with respect to Christmas Eve and Christmas Day, failing which Christmas Day will alternate between them with Mr. Madonna having it in 2017;

(h) The remainder of the children’s vacation shall be shared equally between the parties.

10This is a temporary order and I am thus not prepared to reach so far into the future as to deal with when Penelope begins to attend school on a full-time basis, as requested by Mr. Madonna. Additionally, my references to “an appropriate time as agreed upon between the parties” in the schedule above are to allow for flexibility to accommodate the children’s Montessori and/or daycare schedule on a temporary basis.

Issue #2 – What is the appropriate quantum of child support payable by Mr. Madonna on a temporary basis?

11After separation, Mr. Madonna commenced paying first $2,500 and some months later $2,400 per month to Ms. Smaggus for the support of the two children. He has done so by depositing said amount into a joint bank account held by the parties. Mr. Madonna indicates in his materials, which fact is not disputed, that at the time of the parties separation in April of 2016 there was a balance of $ 48,000 in the joint account, which money Mr. Madonna has not touched. Currently, he continues to deposit $2,400 per month into the account, and since separation he has withdrawn none.

12Mr. Madonna argues that $2,400 per month is higher than the table amount he would be required to pay pursuant to the Federal Child Support Guidelines based on his line 150 income from his Income Tax Returns and Notices of Assessment. In 2016, Mr. Madonna’s line 150 income was $126,333.73, on which amount he would be required to pay $1,774 per month for two children. Mr. Madonna states that the extra $626 per month is for extra expenses, including his portion of s. 7 expenses.

13Ms. Smaggus position is that the lifestyle that Mr. Madonna leads, which includes regular vacations in the Caribbean, frequenting casinos and driving luxury vehicles, suggests that he earns more than he reports to CRA, and that additional income should be imputed to him for the purposes of both child and spousal support. Ms. Smaggus seeks to impute at least $200,000 in annual income to Mr. Madonna based on that having been the income he reported in his mortgage application for his Bellfield property in 2016, or she seeks in the alternative, to apply an average income to him of $178,341 over the past four years, because he is self-employed and he alone determines his income from the series of companies he operates.

14Mr. Madonna states that his income is what it is; in other words, it is what he has reported to CRA. Mr. Madonna indicates moreover that he had substantial savings prior to the termination of the relationship with Ms. Smaggus, and that he continues to do so. The evidence supports that Mr. Madonna had $428,878 in his account as of December 31, 2015, $425,132 as of February 1, 2016, and savings of approximately $610,808 as of July 31, 2017 ($300,000 of which is placed in an account in his father’s name). His evidence is that his lifestyle choices are supported by the money he has worked hard to save, and are not dependent upon his income.

15Ms. Smaggus queries how Mr. Madonna’s savings could have increased by $185,676 from February of 2016 to July of 2017 with an income of only $126,333.73, however, Mr. Madonna’s evidence was that he deposited $91,171 in proceeds from the sale of a property in June of 2017 and also received a reimbursement of $39,500 on a car lease, which account for the bulk of that increase.

16Although s. 19 of the Federal Child Support Guidelines permits the imputation of income where the specific circumstances outlined in subparagraphs (a) to (i) warrant it, I am not prepared to do so on a temporary basis on the evidence before me. This is, of course, without prejudice to Ms. Smaggus pursuing this claim at trial. The onus of imputing income is on the party seeking to impute it. Mr. Madonna’s income structure is complex and in these circumstances establishing the evidentiary basis upon which to impute his income is something more properly suited to trial.

17Having said that, Mr. Madonna’s income has fluctuated downwards since 2013. His Notices of Assessment indicate that his line 150 income has been as follows:

2013 - $207,852

2014 - $163,898

2016 –$123,333

18I did not see a Notice of Assessment in the materials which shows Mr. Madonna’s income for 2015, however, his accountants provided a summary of his personal remuneration at page 9 of a report filed at Tab 6 of the Continuing Record which indicates his dividend and total remuneration for 2015 to be $156,000, which based on a review of the other numbers would be significantly lower than what his line 150 income would be from his income tax return. A comparison of the figures provided in this section of the report with Mr. Madonna’s line 150 incomes for the years 2013, 2014 and 2016 reveal an average difference of $29,000 between the two. Adding that sum to the stated $156,000 dividend and remuneration for Mr. Madonna would result in a 2015 income of $185,000. Applying s. 17 of the Federal Child Support Guidelines to these figures would result in an average income of $158,410 over the last three years. Table support for two children on $158,410 is $2,108 per month. I am prepared to order that Mr. Madonna shall pay that amount per month in support of the children commencing October 1, 2017.

19Mr. Madonna shall also pay section 7 expenses for the children, including for the Montessori, proportionate to his income, which I will discuss below in relation to spousal support.

Issue #3 - Does Ms. Smaggus have a prima facie claim for spousal support?

20It is clear from the evidence of both parties that Ms. Smaggus has been the primary caregiver to both of the children since the birth of Penelope. Ms. Smaggus’ attested to the fact that she and Mr. Madonna agreed that she would not return to fulltime work until their youngest child, Franco, was in Grade 1.

21Ms. Smaggus is a dental hygienist who worked fulltime prior to the birth of Penelope, earning at her highest a salary of about $77,000 per year. She currently works part-time for Dr. Frank Lee. Her schedule consists full days on Tuesdays and Wednesdays (these are the days on which Mr. Madonna visits the children mid-week) and mornings from 9:00 to 11:30 am on Mondays and Thursdays. In an undated letter to Ms. Smaggus’ counsel, Dr. Lee confirms that Ms. Smaggus is a “full-time” employee with these hours, and states: “The reason why Ms. Smaggus has those specific hours on Mondays and Thursdays is due to accommodation for her children’s school hours”. Ms. Smaggus makes approximately $40,000 per annum with this part-time schedule.

22Mr. Madonna makes significantly more than Ms. Smaggus, even at his line 150 income, and clearly has the means to pay support to Ms. Smaggus. The question for the court is one of entitlement. Ms. Smaggus asserts that she suffered an economic disadvantage due to the role she assumed during the relationship and as a result of its breakdown. Mr. Madonna questions her entitlement both on the basis that the relationship was of short duration and because he asserts that Ms. Smaggus is purposefully or voluntarily underemployed.

Analysis

23The court is not required to “conduct an in-depth analysis of the standing and entitlement issues. If the Applicant is able to make out a good, arguable case for standing and entitlement the court will assess support on the basis of the parties’ needs and means.” The questions to be answered in an application for temporary spousal support are: does the Applicant have standing; is the Applicant entitled to the support; what are the dependant’s needs; and, does the payor have the ability to pay? (Robertson v. Hotte, 1996 8083 at paras 7 and 8.)

24As noted by Labrosse J. in Kelly v. Kelly, 2016 6476 at para 17, “interim support motions are not intended to involve a detailed examination of the merits of the case. Orders for interim support are based on a triable or prima facie case: see Knowles v. Lindstrom, 2015 ONSC 1408 at para 8.”

25In my view, Ms. Smaggus has made out a prima facie case that she is entitled to some measure of interim spousal support. The parties had two children in very short succession. She was the primary caregiver of both, from the times of their respective births, which role reduced her ability to earn income for some period of time. She was dependent upon Mr. Madonna to provide for the family.

Issue # 4 – What quantum of spousal support should be payable by Mr. Madonna?

26Mr. Madonna argues that if the court finds that Ms. Smaggus has a prima facie case for spousal support, income should be imputed to her based on her voluntary underemployment as evinced by the letter of Dr. Lee. I agree. Ms. Smaggus cannot rely on a pre-separation agreement with Mr. Madonna about how they were going to organize themselves as a family to support her post-separation employment choices. This is particularly so where the parties have access to free childcare for the children in the form of the paternal grandparents, whom they already use when both parties are working. At this juncture, Ms. Smaggus is working part-time by choice, which puts her squarely into the analysis in Drygala v. Pauli, 2002 41868 (ON CA), 2002 CarswellOnt 3228, where the court held at paragraph 28 that a person is intentionally underemployed where she chooses to earn less than she is capable of earning.

27Once a finding of intentional underemployment is made, the court’s exercise of discretion in imputing income to a party must be grounded in evidence. I find that based on Ms. Smaggus’ history of having been able to make $77,000 per annum working fulltime as a dental hygienist more than four years ago, an income of $70,000 should be imputed to her for the purposes of calculating spousal support.

28I have found Mr. Madonna’s average income to be $158,410. The Spousal Support Advisory Guidelines provide that at those incomes ($158,410 and $70,000 respectively), a “with child support” formula on a three year relationship results in a mid-range spousal support of $770 per month, which I am prepared to order on a temporary basis.

Issue #5 – Should an order for payment of an interim disbursement by Mr. Madonna be made?

29Ms. Smaggus seeks an order requiring Mr. Madonna to pay for an interim disbursement of $20,000 which would allow her to retain an expert, Mr. Steve Pittman, to conduct an investigation and create a report regarding what Mr. Madonna’s income is for the purposes of child and spousal support. Ms. Smaggus submits that a determination of the income available to Mr. Madonna for child and spousal support purposes is very complex. She submits, moreover, that she does not have the means to obtain such a report, absent Mr. Madonna paying for it.

30Mr. Madonna’s position is that Ms. Smaggus has not made out the need for such an assessment, but that even if she did, she has the means to obtain it based on a) her having had access to $48,000 in the parties joint bank account at the time of separation, and b) her currently having an additional approximately $30,000 in liquid assets according to her financial statement sworn on September 22, 2017.

Analysis

31Pursuant to Rule 24(12) of the Family Law Rules, the court may make an order that a party pay an amount of money to cover part or all of the expenses of carrying on a case by the other party. The power to do so is discretionary and the discretion must be applied to further the primary objection of fairness. (Rogers, J. Stuart v. Stuart, 2001 ONSC CarswellOnt 4586)

32The rule is intended to enable the court “to provide a level playing field, to ensure that all parties can equally provide or test disclosure, make appropriate valuations of net family property, make or consider offers to settle or prepare and proceed to trial.” (Boris v. Boris, 2005 ONSC CarswellOnt 975)

33Pursuant to the principles laid out by Justice Emery in Woodburn v. Woodburn, 2016 ONSC CarswellOnt 17658, I am of the view that Ms. Smaggus has provided evidence to establish that there is a prima facie case of sufficient merit to warrant pursuit on the issue of a proper determination of Mr. Madonna’s income for the purposes of child and spousal support, as well as that the specific amount of $20,000 is necessary and required by Mr. Pittman. However, I am unable to determine that Ms. Smaggus is incapable of funding it or has no resources available to fund it. I refer specifically here to the $48,000 which was in the parties’ joint account at the time of separation, $24,000 of which belonged to Mr. Madonna, which he has neither taken nor claimed.

Order

34There shall be an order as follows:

(1) Mr. Madonna shall have access to Penelope and Franco from Saturday, October 7 at 9:00 am to Sunday, October 8 until 6:00 pm;

(2) Mr. Madonna shall have access to Penelope and Franco from Saturday, October 21 at 9:00 am to Sunday, October 22 until 6:00 pm;

(3) Commencing November 3, 2017, Mr. Madonna shall have access to Penelope and Franco every second weekend from Friday at an appropriate time agreed upon by the parties until Sunday at 6:00 pm;

(4) Commencing December 1, 2017, Mr. Madonna shall have access to Penelope and Franco every second weekend from Thursday at an appropriate time agreed upon by the parties until Monday morning at an appropriate time agreed upon by the parties;

(5) During the weeks immediately following his weekends, Mr. Madonna shall continue to have two daytime visits per week with the children;

(6) During the weeks following a non-access weekend, Mr. Madonna shall have one overnight access visit to Penelope and Franco on either a Tuesday night to Wednesday morning or Wednesday night to Thursday morning as agreed upon by the parties;

(7) The children’s vacation from Montessori over Christmas shall be equally shared by Ms. Smaggus and Mr. Madonna. They may come to an agreement with respect to Christmas Eve and Christmas Day, failing which Christmas Day will alternate between them with Mr. Madonna having it in 2017;

(8) The remainder of the children’s vacation shall be shared equally between the parties.

(9) Commencing October 1, 2017, Mr. Madonna shall pay to Ms. Smaggus $2,108 per month child support for the two children of the relationship, Penelope Isobel Antonietta Madonna, born August 4, 2014, and Franco Andrew Madonna, born December 22, 2015 representing the FCSG table amount for two children on an annual income of $158,000.

(10) Commencing October 1, 2012, Mr. Madonna shall pay to Ms. Smaggus mid-range spousal support of $770 per month on their respective incomes of $158,000 and $70,000.

(11) Commencing October 1, 2017, Mr. Madonna shall pay 69.3% and Ms. Smaggus shall pay 30.7% of the children’s s. 7 expenses.

(12) Mr. Madonna shall maintain sufficient life support coverage to secure his child and spousal support obligations for which Ms. Smaggus and the children shall be named the irrevocable beneficiaries. Mr. Madonna shall provide proof of such insurance to Ms. Smaggus within 15 days of the release of this endorsement.

Costs

35If the parties cannot agree on costs then they may make written submissions not exceeding three pages together with their bills of costs and any offers to settle within 15 days of the release of this decision.

Madam Justice Tracy Engelking

Date: October 6, 2017

CITATION: Smaggus v. Madonna, 2017 ONSC 6015 OTTAWA COURT FILE NO.: FC-17-411 DATE: 2017/10/06

ONTARIO SUPERIOR COURT OF JUSTICE

RE: Jane Ann Smaggus, Applicant AND Domenic Franco Madonna, Respondent

BEFORE: Justice Tracy Engelking

COUNSEL: Wade L. Smith, Counsel for the Applicant D. Larry Segal, Counsel for the Respondent

ENDORSEMENT