Rolley v. Rolley, 2018 ONSC 7409

COURT FILE NO.: FD1092/16 DATE: 20181211

ONTARIO

SUPERIOR COURT OF JUSTICE

FAMILY COURT

BETWEEN:

David Wayne Rolley Applicant

AND:

Melissa Bernier Rolley Respondent

Counsel: Jelena Buac, for the Applicant Robert MacLeod, for the Respondent

HEARD: September 17, 18, 19, 2018 BEFORE: Leitch J.

[1] The sole issue in this trial was the extent to which the applicant should share in the respondent’s pension.

Background facts

[2] The parties had a 24-year relationship. They began cohabiting on January 1, 1991. After 21 years of continuous cohabitation, they married on October 13, 2012.

[3] The applicant is 60-years-old. He left school after grade 9 and has learning disabilities which hindered his education and employment opportunities. He worked for 28 years at Canada Bread in London, Ontario. Since Canada Bread closed its operations in London in 2003 he has not been employed. He declined to participate in Canada Bread’s pension based on the views of people he described as “smart guys in the plant”. The applicant has some health issues and relies on spousal support and CPP benefits.

[4] The respondent is 48 years old. She completed her nursing degree at Fanshawe College in 1997 and obtained employment as a nurse in 1998 and has worked in the field since. She began contributing to her pension in 2000.

[5] The parties have two children, Jake (born November 19, 2006) and Morgan (born November 2, 2010), who are now aged 12 and 8.

[6] They dispute whether they separated on October 13, 2014, as the respondent asserts, or January 1, 2015, as the Applicant asserts.

[7] The parties purchased land in Belmont, Ontario in January 2000 as joint tenants. They commenced construction on the property in 2000. They sold their home on January 7, 2016 and divided the net proceeds equally. They continued to live together in the matrimonial home until June 2015.

[8] To their credit, they have resolved the issues of custody, access, child support, spousal support, and – aside from the pension - equalization of net family property.

The applicant’s position regarding his entitlement to share in the respondent’s pension

[9] The applicant contends that he and the respondent were engaged in a joint family venture throughout their relationship.

[10] The applicant submits that the respondent completed her nursing degree leading to her employment (from which she benefits from her pension) with his assistance and financial support.

[11] The applicant claims that, as a result of his work towards the home and in service of the family, not being provided a portion of the pension since the date of enrollment in the plan would unjustly enrich the respondent.

[12] The applicant claims a one-half interest in the value of the respondent’s pension up to January 1, 2015 (the date he contends they separated) “by way of constructive trust resulting from unjust enrichment”. The value of the pension on the date of separation was $296,715.35. The respondent therefore seeks a monetary award equal to a 50% interest totalling $148,457.68.

The respondent’s position in relation to her pension

[13] It is the respondent’s position is that the applicant is only entitled to the maximum transferrable value of the pension during the marriage, and not for the period of cohabitation. The Family Law Value of the pension between October 13, 2012 (the date of marriage) and the respondent’s proposed separation date of October 12, 2014 is $40,883.91, of which the applicant would be entitled to a monetary award of $20,441.95.

The applicable legal principles

[14] Courts have imposed a constructive trust on property to compensate for unjust enrichment in common law relationships where a party has made substantial contribution to another’s property without compensation (see for example Becker v. Pettkus, [1980] 2 S.C.R. 834; Sorochan v. Sorochan, [1986] 2 S.C.R. 38; and Peter v. Beblow, [1993] 1 S.C.R. 980).

[15] In order to establish an unjust enrichment, the claimant must demonstrate that

1. There has been an enrichment of the responding party
2. There has been a corresponding deprivation of the claimant, and
3. There is no juristic reason for the enrichment.

[16] It is important to note that courts have consistently held that the mere fact of a relationship does not constitute a juristic reason for the enrichment of one spouse over the other.

[17] It is also important to note that jurisprudence has established that there must be a link between the claimant’s contributions and the property in which the constructive trust is claimed.

[18] In Kerr v. Baranow, [2011] 1 S.C.C. 10 at paras. 80 – 85, Cromwell J. observed that the basis of unjust enrichment can be “the retention of an inappropriately disproportionate amount of wealth by one party when the parties have been engaged in a joint family venture and there is a clear link between the claimant’s contributions to the joint venture and the accumulation of wealth.”

[19] It is important to note that Cromwell J. was clear that “the monetary award for unjust enrichment should be assessed by determining the proportionate contribution of the claimant to the accumulation of wealth.”

[20] Further, there is no presumption that “wealth acquired by mutual effort will be shared equally” and “cohabitation does not, in itself… entitle one party to a share of the other’s property...”

The evidence related to the issue in dispute

The period of cohabitation prior to the respondent returning to school 1991 – 1994

[21] As noted, the parties began living together in January 1991 in the applicant’s home at 21 Euclid Avenue. The applicant purchased this property, which he described as “a shack” and the worst house on the block. He completely gutted the home and improved the house over a 14 to 15-year period. He worked hard at Canada Bread, including overtime hours to save money to complete renovations on the house which were about 95% completed when the respondent moved in with him in early 1991.

[22] When the respondent moved in with the applicant she worked at CIBC.

[23] While they lived together the applicant paid the utilities and bought the groceries. While the applicant agreed that it wouldn’t be right to say that he paid for everything, he indicated the respondent only bought cases of beer from time to time and some groceries.

[24] The applicant acknowledged that both he and the respondent worked towards the upkeep of the Euclid Avenue property, that the respondent cut the grass, and that both of them worked on renovations.

[25] The applicant also acknowledged that while he continued to pay the mortgage, the respondent contributed money towards it and they were successful in significantly reducing the mortgage.

[26] However, the applicant denied that the respondent paid $400 a month in rent to him.

[27] On the other hand, the respondent testified that because the applicant wanted to keep things separate - and did not want her to have a claim for one half of his house - she paid rent when she moved into the applicant’s Euclid Avenue property.

[28] I am satisfied that the parties maintained separate finances and were not involved in a joint venture in the years prior to the respondent’s return to school. I am satisfied the respondent did contribute rent to the applicant just as the respondent claimed on her bankruptcy proceeding, which I will discuss below. This lack of joint venture or joint arrangement is made clear by the evidence respecting the respondent’s return to school.

The respondent’s return to school in a nursing program 1994 - 1997

[29] In the early years of their relationship, the respondent went back to school to upgrade her education to qualify to apply for a nursing program. During this time, she continued to work part time at the CIBC.

[30] The respondent was successful in her application to enter a nursing program and obtained an OSAP loan to cover some of her expenses.

[31] I am satisfied that, as the respondent testified, they maintained separate finances during the time she was in school. She paid rent and they continued to divide their work responsibilities around the house.

[32] It is clear that the applicant made no financial contribution to the respondent’s nursing program of any kind other than providing a car for her to drive to school.

Circumstances after the respondent graduated from nursing school 1997 – 1998

[33] The applicant and respondent both testified that there were not many nursing jobs available when the respondent graduated.

[34] When it was put to the applicant on cross-examination that he suggested the respondent apply for welfare, the applicant did not recall that. However, he did recall a visit from a welfare official to their Euclid Avenue home in which a separate bedroom was set up to make it appear that the respondent did not live with the applicant.

[35] The respondent testified that it was the applicant who suggested that she collect welfare while she was trying to find a nursing position. I note that while the applicant had some recollection of the respondent’s welfare application, he acknowledged that the respondent’s recollection might be better. The respondent testified that she made the application because she did not have many other options. She acknowledged she and the applicant deceived the welfare officials by making it appear as though she did not live with the applicant. Deceit of the welfare system is a significant act of dishonesty. However, this dishonesty, which - as noted - was fully acknowledged, has not caused me to negatively assess the veracity and reliability of the respondent’s evidence as a whole.

[36] The parties thought about moving west and went there for one week thinking that they might buy property. They returned after a very short visit.

[37] The other consequence of the limited job market was that the respondent declared bankruptcy to extinguish her OSAP debt. The respondent testified that she was very stressed by her obligations to start repaying her OSAP loan in circumstances where she could not obtain a full-time nursing job and was working only casual hours and/or in a sales job. She testified it was the applicant’s suggestion she file for bankruptcy and she felt as though she had no other option than to do so.

[38] The applicant denied that the respondent’s bankruptcy was his suggestion. However, he was aware of, and fully involved in, her bankruptcy application. The applicant also acknowledged that his income and assets continued to be kept completely separate from the respondent’s. He did not offer to pay anything to avoid the respondent’s bankruptcy.

[39] The responsibility for the debt incurred by the respondent for her return to school was completely her responsibility.

[40] The applicant declared on the documentation relating to the respondent’s bankruptcy that she was responsible for rental payments to the applicant of $400 a month. I am satisfied that she continued to make these payments to the applicant.

[41] As set out above, this evidence fortifies my earlier conclusion that the parties did not engage in a joint venture of the nature contemplated in Kerr v. Baranow, 2011 SCC 10. Importantly also, I find that the applicant did not contribute to the respondent’s education expenses. It is fair to say that he supported her return to school. However, he suffered no deprivation by virtue of the fact the respondent pursued further education while they lived together.

The respondent’s full-time nursing employment – 1998 to the present

[42] The respondent obtained a full-time position at LHSC in 1998. She has maintained full time employment, working 12-hour day or night shifts. As previously set out, she started contributing to her pension in 2000.

[43] Once the respondent obtained her full-time employment the parties increased their contributions to the mortgage on Euclid Avenue.

The acquisition of the Belmont Property in 2000

[44] Having worked hard to successfully pay down the mortgage on Euclid Avenue, the parties mortgaged that property to purchase their land in Belmont, Ontario in 2000.

[45] As the applicant put it, they decided to build their dream home on the Belmont property.

[46] They eventually sold the Euclid Avenue property and used the equity in that property to start building their new home.

[47] They broke ground in 2000.

[48] The applicant contributed a $42,000 inheritance to the construction project. The parties obtained a construction loan secured by a mortgage on the property and thereafter took out various lines of credit to pay for construction costs. The respondent and applicant applied for their loans together. Both parties had responsibility for the lines of credit which were secured against their jointly owned property in Belmont.

[49] They opened their first joint account when they started to build the house and their employment income and mortgage and loan proceeds were deposited into the joint account.

[50] The applicant took on responsibility for overseeing construction of their home. He also worked along with the hired contractors, more so after he lost his employment in 2003 (the details of which I will discuss below).

[51] The applicant moved into the home to the extent it was completed in the fall of 2002. At that time, there was no running water, no hydro, and one half of the roof was missing. Eventually, the applicant and respondent moved into the basement.

The applicant’s loss of his Canada Bread employment

[52] The Canada Bread location in London closed in 2003.

[53] As previously noted, the applicant did not enroll in the Canada Bread pension plan because he did not trust it and, although he understood that contributions to a registered retirement savings plan was a better idea, he had never made such contributions.

[54] The applicant acknowledged that he had considerable seniority as a unionized employee when the plant closed. He was offered other employment at a different depot for minimum wage. It was suggested to him that he also had the opportunity to move his seniority to another plant, but the applicant was really not clear the extent to which that was an option.

[55] The applicant received severance pay, which he contributed to the construction of their home in Belmont.

[56] As the respondent testified, by the time the applicant lost his job at Canada Bread (after many years of talk that the plant would close), they had started to build their house. Although she encouraged the applicant to apply for Unemployment Insurance, he did not do so.

[57] The applicant went to the Unemployment Insurance office and picked up the forms. The applicant has difficulty reading and writing and needs help to complete such administrative tasks. The respondent helped him complete the forms, but the applicant would not submit them. As the respondent put it, there was not much she could do to make him apply, as the applicant is his own person, he does what he wants to do and she cannot force him to do things.

[58] The respondent wanted the applicant to get another job after he lost his employment with Canada Bread, but the applicant continued to work only on their home construction.

[59] I conclude that the applicant was disinterested in pursuing employment opportunities after losing his employment at Canada Bread. In fact, the respondent made arrangements for the applicant to obtain a job as a porter because of a friendship she had. However, the applicant made no effort to obtain this position.

[60] I can conclude also that it was clearly not part of any type of joint venture or joint plan that the applicant would remain unemployed after losing his job at Canada Bread.

[61] In fact, the respondent took on a second job so that they could afford to continue building the house.

[62] The respondent started her second job at Alexandria Hospital in 2003.

[63] The applicant testified that the respondent’s motivation for taking this second job was because she could make “great money”, it would “boost her pension”, and she would be able to retire earlier. This evidence is not accurate. The respondent has only ever been a casual part-time employee at Alexandria Hospital and, throughout the time she worked there (up to February 2015), that work did not enhance her pension entitlements (which is only available through her full-time employment at LHSC).

Continued construction of the home in Belmont 2002 - 2015

[64] The applicant continued to work on the house construction for 13 more years, hiring contractors as required. At times, the applicant worked hard on the house. However, as the respondent testified, taking 13 years to build the house on their property was not part of the plan and - at the end - they hired contractors who finished the project in 3 months.

[65] While their home was being constructed, the respondent kept working to support the family and assumed significant responsibilities, as I will next describe.

The applicant’s and respondent’s home responsibilities after 2003

[66] The applicant and the respondent both planted many trees on the property. They raised chickens and, for four to five years, collected the eggs from up to 140 chickens which the respondent sold at work.

[67] While the applicant worked on their house and maintained the property, the respondent worked full-time at LHSC and continued her second job at Alexandria Hospital. Other than during her maternity leaves, the respondent worked – at a minimum - full-time hours. When the respondent worked two jobs, she worked 60 hours a week.

[68] The respondent usually made all of their meals. She did all of the cleaning. She bought all of the groceries and did 95% of the laundry.

The applicant’s and the respondent’s involvement with the children

[69] The applicant testified that he did a lot of activities with the children on the property. He also described looking after the children overnight when the respondent worked or when the children were sick.

[70] The children were each in daycare after the respondent returned to work after her maternity leave.

[71] In addition, the respondent’s parents played a significant role in their grandchildren’s lives. They picked the children up from daycare and cared for them until the respondent completed her nursing shift and was able to pick them up. The children also frequently had dinner at their grandparents’.

[72] Overall, the most significant contribution made by the applicant was looking after the children before they were school age while the respondent napped prior to beginning her night shift. Once they started school, the Applicant was responsible for them during the evenings and overnight while the respondent worked. During these times, the respondent would continue to make the meals and organize the children’s clothing.

[73] Essentially, as it was suggested to the applicant on cross-examination, the applicant filled in gaps and provided childcare when the respondent, daycare, or the respondent’s parents were not available. In other words, the applicant was fourth on the list for providing childcare.

[74] The respondent was the far more industrious member of the family.

[75] As the children got older, she made their dinner, set out their clothes, made their lunches and - in essence - took full responsibility for the children, responding to any of the applicant’s inquiries while the children were in his care for what, in my view, were relatively limited periods of time.

[76] The respondent almost exclusively took the children to their mental and dental appointments and attended all the parenting nights at the children’s school.

[77] It appears that the applicant disengaged from his relationship with the respondent, and that they did very little as a family.

The parties’ marriage on October 13, 2012

[78] The applicant testified that the respondent came to the applicant one day and suggested they get married and he agreed. He testified that the relationship before their marriage on October 13, 2012 had been great and the relationship didn’t change after that.

[79] In contrast, the respondent testified that at the time of their marriage their relationship was not the best but she wanted their children to have the same last name for school and travel and she also thought that getting married would improve their interaction and the applicant’s level of engagement.

[80] They made no changes in how they dealt with their finances after the date of marriage.

[81] Unfortunately, as the respondent put it, things deteriorated after their marriage.

Date of separation – October 13, 2014 or January 1, 2015?

[82] The respondent described the parties’ separating in mid-October 2014 after the respondent and the children had been surprised by her parents with the gift of a trip to Disneyworld. This travel opportunity upset the applicant and he did not want them to go to Florida because of an upcoming meeting addressing problems with their neighbours.

[83] The applicant asserted that after a conversation after Christmas in 2014, he told the respondent she had broken him and - as a result - his position was that they separated January 1, 2015.

[84] I note that the respondent did not open her own bank account until January, 2015 and the parties lived together until June, 2015. However, I accept the respondent’s evidence that the delay in opening her own account resulted from how busy she was and that the evidence does not detract from her assertion respecting the date of separation.

[85] I am satisfied that the date of separation more likely occurred when the respondent stated it did in October 13, 2014.

Analysis and conclusions

[86] As I described above, the parties maintained separate finances before they started construction on their home in Belmont. They had no joint bank account prior to that time.

[87] The respondent financed her schooling and paid rent to the applicant while in school. She declared bankruptcy when she could not handle her debts.

[88] After she started working full-time as a nurse, she contributed to the Euclid Avenue mortgage.

[89] I agree, as the respondent’s counsel asserted, that between living on Euclid Avenue and the date of marriage, there was an evolution in their relationship as evidenced by the fact that they opened a joint account, planned the construction of their dream home and had two children together.

[90] The focus in relation to the issue raised in this trial is on the question whether the respondent, in retaining all her pension entitlement from 2000 to the date of marriage, is receiving a disproportionate share of property that the applicant contributed to.

[91] I conclude that the applicant’s claim for a one-half interest in the respondent’s pension prior to the date of marriage cannot succeed for a number of reasons.

[92] There is no link between the applicant and the respondent’s successful completion of her nursing program, which led to the employment from which she is entitled to her pension. As noted, while the applicant was supportive of the respondent obtaining this education, she paid her way throughout the time she was in school and was financially responsible for all of her expenses and the debt incurred in relation to same.

[93] I cannot conclude that the respondent has been enriched by the applicant in relation to the acquisition of her education which allowed her to obtain employment with the benefit of a pension.

[94] I also cannot conclude that the respondent has been enriched by the applicant by virtue of his contributions to their home in Belmont. Although the respondent contributed to the equity in the Euclid Avenue property, it is fair to say that a portion of that equity belonged to the applicant. It also must be acknowledged that he contributed his severance pay from Canada Bread and a modest inheritance to their construction costs. However, the respondent, since 2003, solely supported the family while the house was being built and - at the same time - was responsible for the large majority of household responsibilities and childcare.

[95] I do not conclude that these are circumstances where the applicant was absent from the workforce as part of a joint plan or because his labour was needed to construct the house. It must be borne in mind that the applicant required a skilled contractor for him to work along with for large portions of the construction.

[96] I note also that it cannot be said that the applicant was a significant contributor to the care of the children.

[97] It is true that the applicant did make contributions to their relationship, their children and their home but it must be borne in mind that he received one-half of the net sale proceeds from the home and is in receipt of spousal support.

[98] These circumstances are quite distinct from those before the court in Bigelow v. Bigelow, where the wife was successful in her constructive trust claim in relation to her husband’s pension based on unjust enrichment because of the housekeeping and childcare services she provided during a period of pre-marriage cohabitation.

[99] These circumstances are also distinct from those before the court in Bertrand v. Bertrand, where the wife was successful in her constructive trust claim over one-half of the value of the pension accumulated over the pre-marital period because the wife had paid the husband’s living expenses while he completed his university degree, which allowed him to use his own earnings for his educational costs.

[100] Similarly, these circumstances are distinct from those in Caravan v. Caravan, where the wife, who claimed a constructive trust in her husband’s pension, had done the majority of the childcare and household chores during the period of co-habitation and marriage, and supplemented the family income with earnings of her own.

[101] As was noted in Cloutier v. Frances, 2009 ONCA 805, where the wife’s claim to the husband’s pension was successful, the courts in Bertrand, Bigelow, and Thibert v. Thibert (which was relied on in Bertrand and Bigelow) found that the contributions of the wife were directly linked to the husband’s pension entitlement. That finding cannot be made here.

[102] As was commented in Cloutier v. Frances, 2009 ONCA 805, in Kerr v. Baranow, 2011 SCC 10, Cromwell J. noted that unjust enrichment is “inherently flexible” and the focus must be on the question whether there will be an unjust retention of a disproportionate share of assets by the respondent if the applicant’s claim is not allowed.

[103] However, in this case, unlike the case of Cloutier v. Frances, 2009 ONCA 805, I cannot conclude, as the trial judge did in Cloutier, that “the evidence supports the finding of prolonged mutual effort on the part of both parties… that they worked collaboratively towards common goals, namely, advancing their careers and providing for their own needs and that of their daughter… that they worked as a team, carrying out their respective employment and family responsibilities and taking on extra responsibilities when the circumstances required it”.

[104] As I have set out above, the applicant’s contributions to the family, other than being involved as I have described in construction of their home, were relatively limited. These are not circumstances where he left employment for family reasons or did not pursue further employment for family reasons.

[105] Further, in any event, even if I had found that the parties were engaged in a joint venture of the nature contemplated in Kerr v. Baranow, 2011 SCC 10, I would not conclude that the applicant is entitled to one-half of the respondent’s pension as he claims.

[106] These circumstances, I find, are more akin to those before the court in Johnson v. Bruno, 2011 BCSC 665, where the court concluded that the plaintiff “made no measurable contribution to the capacity of the respondent to accumulate the right to a future pension”.

[107] I am mindful that the parties had a 24-year relationship. However, I cannot conclude that the respondent obtained her nursing degree because of contributions of the applicant. I also cannot conclude that the respondent was able to remain employed because of the applicant’s contributions. I cannot conclude that the applicant and respondent made comparable contributions and efforts in the home or in relation to childcare.

[108] As I have set out above, the respondent was much more productive in, and outside of, the relationship than the applicant.

[109] I agree with the respondent that she was the primary caregiver for the children and the primary service provider throughout their relationship. Those contributions were maintained despite the fact that the applicant was not employed after 2003. Further, the evidence does not establish that the time the applicant committed to the construction of their home was necessary.

[110] In other words, I cannot conclude that the respondent has been enriched in any way by the applicant. It simply cannot be said that working on the home replaced full-time employment for the applicant.

[111] To paraphrase the words of Cromwell J. in Kerr v. Baranow, 2011 SCC 10, there has been no disproportionate retention of assets acquired through joint efforts with the applicant if the respondent retains the rights to her pension.

[112] As a result, the applicant’s claim is dismissed.

Final Order

[113] For the foregoing reasons, an order will go as proposed by the respondent as follows:

1. $20,441.95 of the Family Law Value of the respondent’s pension interests, plus interest/investment earnings from the Family Law Valuation Date to the beginning of the month in which the transfer is made, will be transferred to the applicant in a lump sum;
2. The Plan Administrator will make the Lump Sum Transfer to the applicant’s LIRA;
3. To effect the Lump Sum Transfer, the applicant will complete and file with the Plan Administrator, a Pension Form 5 (Application to Transfer the Family Law Value);
4. The parties will cooperate and complete all documents necessary to facilitate the Lump Sum Transfer, including the completion and delivery of all necessary Pension Forms, together with any supporting documentation and additional information required or requested by the Plan Administrator.
5. Upon completion of the transfer as outlined above, all other claims between the parties are dismissed.

[114] I urge the parties to endeavour to resolve the issue of costs. If necessary, brief submissions may be made in 30 days.

“Justice L.C. Leitch” Justice L.C. Leitch

Released: December 11, 2018

COURT FILE NO.: FD1092/16 DATE: 20181211 ONTARIO SUPERIOR COURT OF JUSTICE FAMILY COURT BETWEEN: David Wayne Rolley Applicant AND: Melissa Bernier Rolley Respondent REASONS FOR JUDGMENT Leitch J. Released: December 11, 2018