COURT FILE NO.: FS-96-FP242436-0001
DATE: 20180612
SUPERIOR COURT OF JUSTICE
B E T W E E N:
JAMES OSTAPCHUK
Applicant; Respondent in Motion to Change
-and-
SVITALANA BENYK
Respondent; Applicant in Motion to Change
P R O C E E D I N G S
BEFORE THE HONOURABLE MADAM JUSTICE KITELEY
on MONDAY, JUNE 4 2018
at 393 UNIVERSITY AVENUE, TORONTO, Ontario
A P P E A R A N C E S:
Ms. Galyna Pribytkova
Counsel for the Respondent; Applicant in Motion to Change, Svitalana Benyk
Applicant; Respondent in Motion to Change, not present and unrepresented
E N D O R S E M E N T
KITELEY J.: (ORALLY): In an order dated July 31, 2001, I ordered Mr. Ostapchuk to pay table child support in the amount of $557.00 per month based on income of $39,977 and I ordered him to pay 47% of the s.7 expenses, namely $61.45 for a total of $618.00 per month. The Court of Appeal subsequently increased his contribution to 57% of the s. 7 expenses but Family Responsibility Office was never asked to make the adjustment. FRO has continued to reflect the amount owing as $618.00 per month.
The Respondent has brought this Motion to Change Final Order in which she seeks an order requiring Mr. Ostapchuk to retroactively and prospectively increase the child support and an order fixing the arrears of s. 7 expenses.
The children were born March 31, 1995 and June 12, 1993. The younger child is still in post-secondary education and living with her mother. The younger child lived with her father from approximately August 2008 to January 2011, and Ms. Benyk does not claim support for her during that period. The older child remained with her mother until she became independent.
I’m just double-checking the younger child. I deliberately have not used their names and counsel – the children were born 1995 and 1993. Samantha was 1995.
MS. PRIBYTKOVA: Yes, Your Honour.
THE COURT: And is the younger child.
MS. PRIBYTKOVA: That’s correct, Your Honour, yes.
THE COURT: The Motion to Change Final Order was issued on August 25, 2014. Counsel for Ms. Benyk served the Motion to Change on October 16, 2014. Mr. Ostapchuk attended the hearing before the Dispute Resolution Officer on December 2, 2014. Counsel for Ms. Benyk brought a motion returnable January 6, 2015 which was served on Mr. Ostapchuk. He attended the hearing at which Mesbur J. made an order permitting counsel for Ms. Benyk to rely on the income report that Mr. Ostapchuk’s second wife had obtained and intended to use in family law proceedings in another court.
MS. PRIBYTKOVA: Your Honour, she was not the wife, if it’s important. She was a spouse. They were never married, the second wife.
THE COURT: Yes, I appreciate your point. There’s often not a legal distinction. But I will change wife to spouse, thank you.
According to her endorsement, Mr. Ostapchuk did not object to the order.
Mr. Ostapchuk did not attend before the Dispute Resolution Officer on February 13, 2015. He did serve and file Notices of Change of Representation in 2015 and 2016. The evidence is that the trial of the action involving his second spouse started in January 2017 and settled during the hearing.
On April 27, 2018 there was a case conference in this court before Justice Mesbur. Counsel served Mr. Ostapchuk with the case conference brief and the Form 13 financial statement sworn April 18, 2018. Mr. Ostapchuk did not attend. Justice Mesbur ordered that the matter proceed to an uncontested trial. Counsel for Ms. Benyk served Mr. Ostapchuk with a copy of Form 23C Affidavit for Uncontested Trial. She did not serve him with a notice of hearing that the trial would take place today. Throughout this proceeding, Mr. Ostapchuk has not provided any financial information. He did not file a Response to Motion to Change. It was not necessary that counsel for Ms. Benyk serve him with a notice of hearing because he was not entitled to notice, and once he received Form 23C, he could have contacted the Trial Coordinator and obtained that information. He did not attend today.
Analysis
The Form 23C affidavit is comprehensive. It did not address the question of notice of the claim prior to the issuance of the Application on August 25, 2014 and Ms. Benyk gave evidence primarily on that issue. In 2008 and 2010, Ms. Benyk was involved in two car accidents, one of which left her in hospital for over 6 months and with permanent brain injury. She was unable emotionally and financially to take any steps to pursue an increase in child support until 2013. Exhibit 4 is a letter from her lawyer, her then lawyer, to Mr. Ostapchuk asking for s. 7 expenses for the older child and raising prior s. 7 claims for both children at a total cost in excess of $20,000. In the absence of response, Ms. Benyk’s then lawyer wrote again to Mr. Ostapchuk in a letter dated August 12, 2013 following up from the July 30, 2013 communication. In that letter, her then lawyer indicated that he had instructions to issue a Motion to Change to claim additional child support and s. 7 expenses.
Mr. Ostapchuk responded in an email dated August 15, 2013 and indicated his views on his daughter’s college expenses. He expressed the view that he was in a credit position regarding child support and would “be taking action to collect and adjust”.
I am satisfied that Mr. Ostapchuk had knowledge no later than August 12, 2013 of the claim for both increased child support and increased s. 7’s.
One of the factors in the case of DBS[^1] is whether the moving party has a reasonable excuse for not seeking support earlier than July 30th, 2013. I accept the evidence in Form 23C and in Ms. Benyk’s evidence at the hearing that her serious health issues meant that she was not in a position to take initiative earlier than mid-2013. She has provided a reasonable excuse.
Another factor in DBS is the conduct of the payor. I accept the evidence in the Form 23C and in her evidence at the hearing that Mr. Ostapchuk did not provide financial disclosure and on that basis, she was unable to verify his income. In fact, her lawyer had to take the additional step of obtaining an order from Justice Mesbur to rely on evidence created in the case involving his second spouse. Between October 16th, 2014 when he was served and today, Mr. Ostapchuk never filed a Response to Motion to Change and never provided any financial information. I agree that that is unreasonable conduct by the payor and addresses that DBS factor.
The third factor is the circumstances of the Child. The younger child still resides with her mother. Between July 2016 and August 2017, she took a year off and no claim is made during that period. However, she is now pursuing a college course and remains a “child of the marriage within the meaning of the Divorce Act.” She continues to need both table amount of child support and s. 7 expenses. At paragraph…
MS. PRIBYTKOVA: Your Honour, sorry, we’re not claiming s. 7 for her anymore.
THE COURT: You’re right.
MS. PRIBYTKOVA: Until June 2016, that’s it.
THE COURT: Yes.
MS. PRIBYTKOVA: Okay.
THE COURT: At paragraph 32 of Form 23C, let me just go back to correct my text to reflect counsel’s input. She continues to need table child support. At paragraph 32 of Form 23C, I have evidence of modest earnings.
The fourth factor is the hardship to Ms. Benyk if the retroactive order is not made. Although she suffered serious injuries, Ms. Benyk refinanced her house so that she could continue to provide support. She has received a significant settlement from the insurer and she has wisely had those funds placed in long term investments from which she receives income monthly. She cannot work and receives federal disability income. If awarded arrears of table amount and of s. 7 expenses retroactively, it would serve to assist her in reducing the mortgage so that she can continue to rely on the settlement funds to provide a reasonable standard of living for her and her daughter.
I am satisfied that Ms. Benyk is entitled to claim retroactive table child support and s.7 expenses commencing in January 2011.
The next issue is the income of Mr. Ostapchuk. In the valuator’s income report in the other domestic case, the valuator summarized on Schedule 2 (page 21 and 22 of Exhibit 1) Mr. Ostapchuk’s income. As counsel pointed out, the calculations were done without having access to tax returns and only notices of reassessment and on the assumption he was allowed a home office calculated at 40%. Both of those are conservative factors. The valuator indicated that Mr. Ostapchuk’s income should be calculated as follows: for 2010, the amount of $37,465; for 2011, the amount of $148,222; for 2012, the amount of $50,297; for 2013, the amount of $213; for 2014, the amount of $2,858.
In the analysis at paragraph 6 on page 6 of Form 23C, Ms. Benyk relies on the stated income for 2011 and 2012 which is reasonable. For the years 2013 to the present, she relies on income of $78,661 which is the average of his income for 2010, 2011 and 2012. Counsel submits that the averaging of 3 years income is appropriate in this case for these reasons. First, because his income rapidly decreased coincidental with this Motion to Change and the other domestic proceeding. Second, based on the information available, Mr. Ostapchuk’s standard of living has not changed vis-à-vis his accommodation, vehicles and vacations. Third, the court ought to draw an inference that as a contractor, he is still working as before but is hiding his income in cash receipts.
I agree with that analysis pursuant to s. 17 and 19(f) of the Child Support Guidelines. I accept the calculations in the table at paragraph 6 on page 6 of the Form 23C. I find that the arrears of $49,710 owing on the retroactive increase in table amount of child support for both children until April 2015 and then the younger child until June 2016 resuming in September 2017 is reasonable. I also agree with the calculation of interest in Exhibit F in the total amount of $6,155.01.
I have reviewed and accept the detailed calculation of retroactive s. 7 expenses referred to in paragraphs 9 to 31 of Form 23C. That calculation incorporates the increase to 57% ordered by the Court of Appeal as well as the increase from 2011 based on the income imputed to him as indicated above together with interest. The total owing on the retroactive s. 7 expenses is $57,149.04, less the amount recorded by FRO, namely, $11,368.25.
Having established his income for the years 2013 to the present at $78,661, it is reasonable to continue to apply that imputed income for the future.
Counsel for Ms. Benyk asks for costs and has provided a costs outline at a full indemnity rate of $22,667 and a partial indemnity rate of $17,146. I am satisfied that Mr. Ostapchuk has demonstrated unreasonable behaviour by failing to file a Response to Motion to Change, failing to provide any income information or documentation, and failing to participate in the legal proceedings so that a trial might have been avoided. On that basis, he should pay full indemnity costs. I have however reduced the amount claimed to delete the costs of the motion before Justice Mesbur on January 15, 2015 because she ordered “no costs”, and delete the costs of the case conferences before the DRO where there is no authority to order costs. I do allow costs of the case conference held on April 27, 2018 on the basis that counsel for Ms. Benyk did a comprehensive brief and on the basis that that was the last opportunity before this hearing for a rational conclusion to have been reached and Mr. Ostapchuk did not attend. I also note that the record contained in Form 23C is a very extensive analysis of all of the available documentation and reflects considerable effort on the part of counsel for Ms. Benyk. I order Mr. Ostapchuk to pay $19,000 including fees, disbursements and HST.
I observed during the hearing that Ms. Benyk demonstrated courage in pursuing this claim against the father of their children who appears to have turned his back not only on her but on the children, notwithstanding Ms. Benyk’s extraordinary health challenges.
For these reasons, I make the order as follows:
Now I’m going to pause. In the last recess when I was given your draft order which I invited you to do over the lunch, I have made some corrections. I’m going to give you my original and I want you to follow along if you’ll receive it from the Registrar.
MS. PRIBYTKOVA: Yes, Your Honour, so all the do I (indiscernible)?
THE COURT: It’s up to you. If you want to get the changes done, I’m here for the rest of the day, and, again, tomorrow, and I will sign the formal order but let me just review the changes with you.
MS. PRIBYTKOVA: Okay.
THE COURT: Have a seat. I realized in reading paragraph 1 that I have to make another change to number 1, so I will speak slowly.
The new number 1 is as follows: For the years 2013 to 2018, this court imputes income to the Applicant James Ostapchuk in the amount of $78,661.33 per year. Do you wish me to read it again?
MS. PRIBYTKOVA: I got it down, Your Honour, thank you.
THE COURT: Now I’m going to read the balance of the order but as I mentioned, I am not using the names of the children so when you draft the order, it will have full names and birth dates where required, but I’m going to refer to, for example, “S.”
MS. PRIBYTKOVA: Thank you.
THE COURT: All right. Paragraph 2 of the draft order is as follows:
Paragraph 5(c) of the order of Justice Kiteley dated July 31, 2001 is varied, in that, the Applicant shall pay $733 per month starting June 1, 2018 to the Respondent as child support for the parties daughter “S” paragraph 3;
The Applicant shall pay arrears of child support for two children “S” and “A” in the amount of $49,710 for the period from January 1, 2011 until May 31, 2018, and prejudgment interest on those arrears in the amount of $6,155.01;
The Applicant shall pay arrears of special and extraordinary expense for two children “S” and “A” for the period from August 2001 until May 31, 2018 in the amount of $45,780.79, including prejudgment interest;
The Applicant shall pay the total amount of child support arrears and arrears of special and extraordinary expenses after adding the arrears according to the Director, Family Responsibility Office, as of May 4th, 2018 in the amount of $36,377.25 in the total amount of $138,023.05;
The Applicant shall pay $138,023.05 to the Respondent Svitalana Benyk by July 15, 2018;
The Applicant shall pay $19,000 as costs for this Motion to Change to the Respondent by July 15th, 2018;
The balance of the order is as drafted. Paragraph 8 relates to the support order and support deduction order;
Paragraph 9 relates to opting out of the Family Responsibility Office;
Paragraph 10 relates to interest from the date of this order with the percentage of interest to be incorporated when the order is entered in the Family Law Office; and
Paragraph 11 is as drafted dealing with financial disclosure.
So that concludes the reasons for decision and the revisions to the draft order. There’s a lot of numbers in these paragraphs. Thank you for the redraft. In making the change, I’ve asked, I would appreciate it if you would look carefully at the arithmetic to make sure that I have got it right.
So it’s quarter to three. The matter is concluded. Will you attempt to make the revisions to this order and bring it back to my Registrar today for signing?
MS. PRIBYTKOVA: Yes, Your Honour, I think it will be 10/15 minutes, Your Honour.
THE COURT: Yes, that’s fine. I think the sooner it gets done, the better, so Registrar, you can assemble the exhibits and the costs outline. I will give them all to you and when counsel does the redraft of the order, I will sign the support deduction order as well as the order that she’s going to give to me, so if you will stand by until she finishes that. I am handing you copies of her redraft which can go in the shredder. And that – another exhibit. I will be closing court now, counsel, so I won’t be coming back but if you give the draft to my Registrar who is not going anywhere immediately and I will do my best to sign the order today so that you could take upstairs.
MS. PRIBYTKOVA: Thank you, Your Honour.
THE COURT: As it happens, we have two of our staff members from upstairs who are observing and Amal Shoom is one who signs orders. So you could, once I sign it, take it to her and she will do the entry of the order for you as quickly as possible. All right, we’re otherwise done. Thank you.
FORM 2
CERTIFICATE OF TRANSCRIPT
(SUBSECTION 5(2))
Evidence Act
I, Yvonne Pawaroo
(Name of Authorized Court Transcriptionist)
certify that this document is a true and accurate transcript of:
James Ostapchuk, Applicant; Respondent in Motion to Change
-and-
Svitalana Benyk, Respondent; Applicant in Motion to Change
(Name of Case)
THE SUPERIOR COURT OF JUSTICE
held in the: .......................................
(Name of Court)
Ctrm #906, 393 UNIVERSITY AVENUE, TORONTO, Ontario
held at: ...........................................
(Courtroom Number and Court Address)
4899_906_20180604_093303.dcr
taken from Recording: ..............................
which has been certified in Form 1.
June 12, 2018
Date Signature of Authorized Court
Transcriptionist
ACT No.: 2989449409
Phone No.: 905-619-0329
E-mail: ypawaroo@gmail.com
[^1]: D.B.S. v. S.R.G. 2006 SCC 37, [2006] 2 S.C.R. 231