Court File and Parties
COURT FILE NO.: FC-14-2105-1 DATE: 20190110
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Sheryl Kristy O’Connell Respondent – and – Houssein Awada Appellant
COUNSEL: Martin Kenny, for the Respondent Self-Represented, for the Appellant
HEARD: November 22, 2018, at Ottawa
Appeal decision
Kershman J.
Introduction
[1] This is an appeal of an Arbitration Award (the “Award”) made by Carol Cochrane which was released on January 12, 2018.
Factual Background
[2] The parties were married to each other on January 20, 1998, and separated on August 7, 2014. They have 3 children: Abraham Isaac Awada, born November 3, 1998; Zachary Awada, born March 3, 2001; and Jacob Awada, born November 22, 2004.
[3] The Appellant (“Mr. Awada”) and the Respondent (“Ms. O’Connell”) signed a Mediation/Arbitration Agreement (the “Med/Arb Agreement”) on November 14, 2016. The Arbitration was carried out in accordance with the Med/Arb Agreement on February 21-24, 2017. The Arbitration Decision (the “Decision”) was released on January 12, 2018. Mr. Awada appeals certain parts of the Award.
Issues
[4] Mr. Awada raises the following issues on this appeal:
a. In relation to the net family property (“NFP”) Equalization Payment amount of $642,880.52 to Ms. O’Connell, Mr. Awada appeals from the following property determinations:
i. That, at the date of separation, Mr. Awada was the owner of Unit 1502-570 Laurier Avenue West, Ottawa, Ontario (the “Laurier Avenue Property”). Specifically, that the Arbitrator included this unit in Mr. Awada’s date of separation assets despite evidence that the property was not beneficially owned by him;
ii. That, at the date of separation, Mr. Awada was the owner of 1385 Palmerston Drive, Ottawa, Ontario (the “Palmerston Drive Property”). Specifically, that the Arbitrator included this property in Mr. Awada’s date of separation assets despite evidence that the property was not beneficially owned by him.
b. That the Arbitrator made findings concerning Mr. Awada’s 2016 income which were contrary to evidence;
c. That the Arbitrator should have imputed an increased level of income regarding Ms. O’Connell’s income when she calculated prospective child support and prospective spousal support; and
d. That the Arbitrator’s quantification of prospective child and spousal support was incorrect due to errors made regarding the incomes of the parties.
[5] Mr. Awada has abandoned his appeal on the issues of date of marriage debt, as well as the calculation of the retroactive s. 7 amount.
Standard of Review
[6] Counsel for Ms. O’Connell argues that the grounds of appeal articulated in paragraph 4(a)(i), and (ii) of this decision are questions of law, and as such, require leave of this Court pursuant to the provision of clause 10.2 of the Med/Arb Agreement; that leave was not obtained, and as such, that these issues should not proceed.
[7] The Court agrees that the two issues raised by Mr. Awada related to property determinations are indeed questions of law, and that leave was required to argue them. Notwithstanding that leave was not obtained, both parties fully argued these two issues before the Court on November 22, 2018. On that basis, the Court waives the requirement for leave and will deal with these two issues.
[8] At paragraph 10 of the Med/Arb Agreement the parties agreed that in addition to appeal rights provided in s. 45 of the Arbitration Act, 1991, S.O. 1991, c. 17, a party may appeal an award based on a question of mixed fact and law.
[9] It is established law that the Court should not interfere with an arbitrator’s award unless it is satisfied that the arbitrator acted on the basis of a wrong principle, disregarded material evidence, or misapprehended the evidence (see: Robinson v. Robinson, [2000] O.J. No. 3299 (S.C.), at para. 5). The significant deference given to arbitrators promotes finality in family law litigation and recognizes the importance of the appreciation of the facts by them; the Court is not entitled to overturn an order because it would have made a different decision or balanced factors differently (see: Hickey v. Hickey, [1999] 2 S.C.R. 518, at para. 12).
[10] An arbitrator, in reaching the terms of an award, sits in the same position as a judge does in a lower court when their decision is appealed; for a decision to be overturned on appeal, it must be found that the arbitrator erred in law and the decision was not correct, or that they made a palpable and overriding error on a question of mixed fact and law (see: Gray v. Brusby (2008), 56 R.F.L. (6th) 165 (Ont. S.C.), at para. 27). This Court is being asked to consider both questions of law and questions of mixed fact and law. Questions of law are to be reviewed for correctness, and questions of mixed fact and law are reviewed for palpable and overriding error in the event the factual and legal aspects cannot be untangled (see: Housen v. Nikolaisen, 2002 SCC 33, [2002] 2 S.C.R. 235, at paras. 8, 10, 37).
Issue 1: At the date of separation, was Mr. Awada the beneficial owner of the Laurier Avenue Property for the purpose of the calculation of the NFP Equalization Payment?
Appellant’s Position
[11] Mr. Awada argues that at the date of separation, he held legal title to the Laurier Avenue Property in trust for his brother, Bilal Awada; this brother was the beneficial owner of the Laurier Avenue Property and the arrangement came as the result of Bilal Awada’s inability to qualify to purchase the unit himself due to poor credit.
[12] Mr. Awada claims that at the time of acquisition of the Laurier Avenue Property, through inadvertence, he did not notice that he was recorded on the Transfer as the beneficial owner of the property. There was no trust document recording that Mr. Awada held title to the Laurier Avenue Property in trust for Bilal Awada, although both testified under oath that at all times, Bilal Awada was the beneficial owner.
[13] It is Mr. Awada’s position that the land transfer documents address legal, rather than beneficial title, and are therefore not indicative of beneficial ownership; that any reference to Mr. Awada being the beneficial owner of the Laurier Avenue Property is in error, and went unnoticed by him when the purchase was closed. Mr. Awada argues that there was clear and uncontradicted evidence, on the valuation date, he was holding the Laurier Avenue Property in trust for Bilal Awada, and that he did so from “day one.”
[14] Mr. Awada argues that it was an error of law for the Arbitrator to find that the Laurier Avenue Property was beneficially owned by him. Relying on principles set out in jurisprudence with respect to a trial judge’s treatment of sworn evidence, and sufficiency of reasons for its rejection, Mr. Awada claims that the Arbitrator committed an error of law in not accepting his and Bilal Awada’s evidence without making any express finding as to why (see: O’Dowda v. Halpenny, 2015 ONCA 22, 43 C.L.R. (4th) 175, at para. 10; Metropolitan Toronto (Municipality) v. Loblaw Grocerterias Co., [1972] S.C.R. 600, at para. 46; Toronto Standard Condominium Corporation No. 2256 v. Paluszkiewicz, 2018 ONSC 2329, at para. 64). Further, Mr. Awada asserts that Ms. O’Connell adduced no evidence in respect to this issue, except to say that she had “no idea” as to the beneficial ownership. It is Mr. Awada’s position that Ms. O’Connell bore the onus to disprove Bilal Awada’s beneficial ownership, but that she failed to do so.
[15] Accordingly, Mr. Awada argues that the NFP equalization in this case should exclude the value of the Laurier Avenue Property and its mortgage debt, thereby reducing the NFP Equalization Payment by $72,000.
Respondent’s Position
[16] Ms. O’Connell argues that the Arbitrator did consider the evidence before her in making a finding that there was no trust relationship between Mr. Awada and his brother Bilal Awada in relation to the Laurier Avenue Property.
[17] It is Ms. O’Connell’s position that the evidence with respect to the trust relationship was not solely limited to the testimony of both Mr. Awada and Bilal Awada. Further, where evidence is limited to the testimony of witnesses, called by one side, the evidence does not automatically lead to a finding in favour of that party. An adjudicator is allowed to make findings of credibility and inference leading to an adverse inference.
[18] Ms. O’Connell argues that the standard of proof required in such cases is on a balance of probabilities, meaning it is “more probable that not” that something was or was not a particular way. In support of this proposition, Ms. O’Connell relies on Sy, Re, 2017 CarswellOnt 16678 (Ontario Consent and Capacity Board), at para. 29.
[19] Ms. O’Connell submits that an appellate court should respect an arbitrator’s findings and determination where a reasonable basis for conclusions exists, and not substitute its own perceptions of what should have been the findings of fact and with respect to credibility (see: R. v. Gagnon, 2006 SCC 17, [2006] 1 S.C.R. 621, at para. 23).
[20] Ms. O’Connell submits that an arbitrator’s reasons do not require a microscopic examination of the evidence in a lengthy trial, and that there is no need to engage in the recitation of all of the trial testimony that is found in the transcript (see: R. v. Galloway, 2008 BCSC 84, 60 M.V.R. (5th) 198, at paras. 32, 36). Accordingly, it follows that an arbitrator is not required to discuss every piece of evidence in detail when explaining the reasons for accepting all or only a part of the testimony of a particular witness on essential issues.
[21] Ms. O’Connell relies on the case of R. v. Dinardo, 2008 SCC 24, [2008] 1 S.C.R. 788, at para. 30, which discusses the sufficiency of reasons and found that while inconsistencies within a witness’ testimony must be addressed, there is no need to prove that a trial judge was alive to and considered all of the evidence, or answered every argument of counsel.
[22] Ms. O’Connell submits that there was no error of law with respect to the witness’ testimony and the weight attributed to it. Further, if Mr. Awada sought to consider the matter in regard to a misapprehension of evidence, the analysis should be focused on an error with respect to a finding of fact, credibility, or an inference; as such, it is an error of mixed fact and law.
[23] Ms. O’Connell relies on several cases that discuss allegations of a misapprehension of evidence. The first case, Fotsch v. Begin, 2015 BCCA 403, 389 D.L.R. (4th) 389, at para. 70, states that the Appellant must be able to identify the misapprehension that has occurred, and not simply use the opportunity to reargue the case by cherry picking the evidence that was rejected by the judge.
[24] A misapprehension of evidence, as discussed by Doherty J. in R. v. Morrissey (1995), 22 O.R. (3d) 514 (C.A.), at para. 83, may refer to:
a) a failure to consider the evidence relevant to a material issue;
b) a mistake as to the substance of the evidence; or
c) a failure to give proper effect to the evidence.
[25] Ms. O’Connell maintains that the Arbitrator gave full and reasoned consideration to the evidence and not just that of Mr. Awada and Bilal Awada’s testimony. Accordingly, there was no error of law, nor an error of mixed fact law in regard to the Arbitrator’s finding that there was no trust relationship between Mr. Awada and Bilal Awada.
Analysis
[26] The Court has previously outlined the law in relation to the standard of review on an appeal from an arbitrator’s decision as it relates to an issue of law, and that of mixed fact and law in paras. 7-10 of this decision.
[27] The Court will analyze both Issues 1 and 2 from the perspective of both a question of law, as well as from the perspective of a question of mixed law and fact.
[28] There is no issue with the Arbitrator’s description or application of the law regarding trusts and trust relationships. The issue boiled down to the question of whose evidence the Arbitrator accepted.
[29] Did the Arbitrator make an error of law by failing to consider the evidence before her in which she found no trust relationship between Mr. Awada and Bilal Awada?
[30] The evidence before the Arbitrator consisted of:
a) the evidence of Mr. Awada;
b) the evidence of Bilal Awada;
c) the evidence of Ms. O’Connell; and
d) the documentary evidence filed at the Arbitration.
[31] The Arbitrator provided an extensive reasoning as to why she found that Mr. Awada did not hold the property in trust for Bilal Awada. In her findings, she stated that the evidence showed that:
a) no trust instrument was entered into between Mr. Awada and Bilal Awada;
b) the state of the title to the Laurier Avenue Property and the sworn Affidavit executed by Mr. Awada at the time of the purchase were inconsistent with the trust claim being asserted;
c) there was no persuasive evidence provided to satisfy her that the purchase money for the Laurier Avenue Property was provided by Bilal Awada. The issue of the repayment of the original deposit paid by Mr. Awada was inconsistent with his brother’s testimony as to the amount;
d) Mr. Awada managed the Laurier Avenue Property and collected the rents associated with his rental;
e) the rental income realized from the Laurier Avenue Property was reported for tax purposes from 2008-2013 on the income tax returns submitted by Mr. Awada and Ms. O’Connell, and any loss sustained, was reflected in their personal tax returns over the years in question. Mr. Awada’s tax returns for 2008-2013 record his ownership interest in the Laurier Avenue Property to be 50%. Ms. O’Connell was noted as the other half-owner in any return in which a co-owner was listed in the statement of real estate rentals; and
f) it was not until after the commencement of the family court proceedings that the legal title of the Laurier Avenue Property was transferred from Mr. Awada to Bilal Awada.
[32] While the Arbitrator has the obligation to listen to the oral evidence and review the documentation filed by the parties, the Court does not find that the Arbitrator is obliged to put greater weight on oral evidence, no matter how many witnesses there are, over that which it places on documentary evidence.
[33] In this case, the Arbitrator was not able to reconcile the oral evidence of Mr. Awada and Bilal Awada with the documentary evidence filed. The Arbitrator found that there was no persuasive evidence provided to satisfy her that the purchase moneys were provided by Bilal Awada. In doing so, the Court finds that the Arbitrator did put her mind to the evidence provided by both Mr. Awada and Bilal Awada.
[34] Further, the Arbitrator was alive to the issue that legal title was only transferred to Bilal Awada after the initiation of the family court proceedings.
[35] On that basis, the Court finds that even if an error in law had occurred, that the decision arrived at was correct.
[36] If the issue is viewed through the lens of an error of mixed fact and law, the Court finds that the Arbitrator committed no palpable and overriding error in her decision.
[37] The Court follows the reasoning in R. v. M. (R.E.), 2008 SCC 51, [2008] 3 S.C.R. 3, at para. 49 in that while it is useful for a judge to articulate their reasons for believing one witness over another on a general or particular point, the exercise may involve factors difficult to verbalize. Furthermore, according to M. (R.E.), at para. 43, detailed recitations of evidence or the law are not required, instead, a judge must show that they have “seized the substance of the matter.”
[38] The Court also follows the reasoning in Dinardo, which discusses the sufficiency of reasons. While inconsistencies within a witness’ testimony must be addressed, there is no need to prove that a trial judge was alive to and considered all of the evidence or should answer each and every argument made by counsel.
[39] Furthermore, the Court does not find that there was any misapprehension of the evidence by the Arbitrator in her decision.
[40] The Arbitrator chose to accept evidence, some of which was contained in documents such as tax returns and title documents; considered the absence of certain documents such as a trust agreement, as well as considered the sworn evidence of witnesses in coming to a determination.
[41] Therefore, the Court finds that Mr. Awada’s argument with respect to Issue 1 fails. The Arbitrator committed no error of law, nor an error of mixed fact and law, and as such, her decision on the ownership of the Laurier Avenue Property stands; namely, that the Laurier Avenue Property belonged to Mr. Awada and shall remain on his side of the NFP statement as of the date of separation.
Issue 2: At the date of separation, was Mr. Awada the beneficial owner the Palmerston Drive Property for the purpose of calculation of the NFP Equalization Payment?
Appellant’s Position
[42] Mr. Awada’s position on this issue is the same as that in Issue 1. Essentially, that the Arbitrator made an error of law by failing to consider the evidence before her in finding that no trust relationship existed between Mr. Awada and Bilal Awada in relation to the Palmerston Drive Property.
[43] Like the Laurier Avenue Property, at the date of separation, Mr. Awada argues that he held the legal title to the Palmerston Drive Property; however, the property was beneficially owned by Bilal Awada.
[44] Mr. Awada argues that the Arbitrator concluded that he and Bilal Awada were lying under oath when they swore that the Palmerston Drive Property was beneficially owned by Bilal Awada at the date of separation. According to Mr. Awada, the evidence led was that in 2006, the purchase money for the property came from Mr. Awada’s other brother, Ibraheem Awada, and that Mr. Awada held the property in trust for his father. In 2009, Bilal Awada paid out the father’s interest and, from that time forth, Mr. Awada held the property in trust for Bilal Awada.
[45] As in Issue 1, Mr. Awada asserts that Ms. O’Connell adduced no evidence to challenge his position on this issue. Further, Mr. Awada again asserts that the land transfer documentation addresses legal, rather than beneficial title.
[46] Mr. Awada therefore argues that the Palmerston Drive Property should not be included in the NFP equalization calculations, and accordingly, the NFP Equalization Payment should be reduced by $97,500.00 as it relates to this property.
Respondent’s Position
[47] Ms. O’Connell relies upon the same legal arguments as those outlined in Issue 1.
[48] It is Ms. O’Connell’s position that there was no error of law, nor an error of mixed fact and law committed by the Arbitrator in finding that no trust relationship existed between Mr. Awada and Mr. Bilal with respect to the Palmerston Drive Property.
Analysis
[49] In connection with the Palmerston Drive Property, the Arbitrator remarked at page 7 of the Decision that the details related to its acquisition, funding, and the circumstances surrounding its purchase were “both confusing and convoluted.” She concluded that, on a balance of probabilities, the Palmerston Drive Property was indeed an asset owned by Mr. Awada, and that its value be included in his NFP calculation.
[50] The Arbitrator noted that when the Palmerston Drive Property was acquired, title was taken in Mr. Awada’s name alone and no mortgage was registered on title at the time of purchase. Further, the land transfer tax affidavit indicated Mr. Awada as the transferee and did not say anything about the property being held in trust.
[51] Following a review of Mr. Awada and Bilal Awada’s evidence, the Arbitrator specifically addresses the issue that Mr. Awada was not a bare trustee of the Palmerston Drive Property. The Arbitrator found Mr. Awada’s conduct not that of a bare trustee because when he bought the property there was no financing on it; further, he then financed it on one occasion and refinanced it a second time, using monies on both occasions for himself without considering the interests of the purported beneficial owner.
[52] The Arbitrator did not accept the oral testimony of Mr. Awada and Bilal Awada regarding ownership, particularly in light of the actions taken by Mr. Awada with respect to the refinancings of the property.
[53] Furthermore, as previously noted, the documentation with respect to the purchase of this property showed Mr. Awada as the owner – not as trustee. The Arbitrator was aware that when Mr. Awada transferred the property to Bilal Awada, the land transfer tax affidavit said that he was transferring it to him as trustee. The Arbitrator chose not to accept the evidence that Mr. Awada was the trustee when he transferred it.
[54] If this issue is viewed as an error in law, the Court finds that the decision arrived at by the Arbitrator was correct.
[55] If this issue is viewed as an error of mixed law and fact, the Court finds that the Arbitrator committed no palpable and overriding error.
[56] Therefore, the Court finds that Mr. Awada’s argument with respect to Issue 2 fails, and the Arbitrator’s decision that Mr. Awada was the beneficial owner of the Palmerston Avenue Property stands. Accordingly, value of the Palmerston Avenue Property as found by the Arbitrator shall remain on Mr. Awada’s side of the NFP statement as at the date of separation.
Issue 3: What was the Appellant’s 2016 income for the purposes of calculating prospective child and spousal support?
Appellant’s Position
[57] Mr. Awada claims that evidence showed his 2016 income was $77,600.00, of which, $25,000.00 came from Qualisult Systems Inc. (“Qualisult”). The Arbitrator did not accept Mr. Awada’s evidence regarding this income, and instead attributed business income of $58,986.00 from Qualisult, basing her finding on a letter that was written and signed by Mr. Awada prior to the preparation of financial statements for Qualisult. Mr. Awada argues that the Arbitrator overstated his income from Qualisult by $25,458.00, and failed to take into account expenses which were shown in the Qualisult financial statements which were submitted as part of the record. As such, Mr. Awada seeks to have his income reduced by $25,458.00 for this reason.
[58] Further, Mr. Awada argues that contrary to evidence that he received no interest income on any promissory notes and had no right to receive interest income, the Arbitrator found as a fact that he had or was entitled to receive such income. The promissory note relates to one received from 1918599 Ontario Limited related to a business purchase. Following an accident, Mr. Awada argues that he sold the balance of his interest in the company and never received any interest payments. The only monies received, according to Mr. Awada, is a monthly payment of $1,400, which has been included in his income for support purposes.
[59] Mr. Awada also received a promissory note from Bilal Awada. At the time the note was made, the parties to the note anticipated that it would be paid in 60 monthly installments at an annual interest rate of 2.6 per cent. According to Mr. Awada, the debt was paid long before it was due, and as such, he never received any income interest from the note. Mr. Awada argues that Ms. O’Connell’s expert witness found no evidence of actual interest payments to him.
[60] Again, Mr. Awada argues that the Arbitrator erred when she failed to accurately find or apply the evidence related to his income, and that she arbitrarily fixed his income at $130,000.00. Accordingly, Mr. Awada seeks to have this income reduced to $82,600.00 per year for the purposes of support.
Respondent’s Position
[61] Ms. O’Connell argues that the evidence with respect to the 2016 income in question was not limited to Mr. Awada’s testimony, but rather, included documentary evidence and the expert evidence of Mr. Pittman. The Arbitrator assessed Mr. Awada’s income based on this evidence, as well as the historical income that he had generated.
[62] Further, Ms. O’Connell claims that Mr. Awada was unwilling to provide financial disclosure to the full extent required. There were no less than 3 different net business income amounts admitted into evidence, and Ms. O’Connell argues that it was reasonable for the Arbitrator to choose the one that she preferred; that her finding was made in consideration of the evidence.
[63] Accordingly, it is the Ms. O’Connell’s position that when considering Mr. Awada’s historical income, evidence given during the Arbitration, the Arbitrator’s characterization of his financial dealings as being a “shell game”, his refusal to make full and frank disclosure, and his inconsistent statements, the Arbitrator was correct in attributing an income of $130,000.00 per annum for 2016 forward. If there was a misapprehension of evidence, according to Ms. O’Connell, it does not meet the standard of being palpable and overriding.
[64] In support of her position, Ms. O’Connell argues that the court is entitled to draw an adverse inference and impute income when a party fails to provide full financial disclosure. Appeals from these financial determinations are not founded when a party had the opportunity to properly prove their income and did not (see: Verwey v. Verwey, 2007 MBCA 102, 41 R.F.L. (6th) 29, at para. 13). Ms. O’Connell also argues that the amount of income imputed to a party is a matter of discretion, the only limitation for which being that there be some basis in evidence for the amount the Court chooses to impute (see: Smith v. Smith, 2012 ONSC 1116, at para. 81). Lastly, Ms. O’Connell claims that people who are self-employed or have irregular income and expenses have a positive obligation to put forward adequate and comprehensive financial records, and that where inadequate, favourable inferences should be drawn to the spouse who is confronted with making sense out of the disclosure (see: Meade v. Meade (2002), 31 R.F.L. (5th) 88 (Ont. S.C.), at para. 81).
Analysis
[65] The Arbitrator found that Mr. Awada had six sources of income for the 2016 period which included: Qualisult, Uber, Castle Shawarma, two promissory notes (co-tenancy and Castle Shawarma), a rent free benefit, and an assumed income from a co-tenancy. Mr. Awada contests the Arbitrator’s findings as they relate to the attribution of $58,986.00 in business income from Qualisult, as well as interest income received on the promissory notes.
Qualisult:
[66] In her findings, the Arbitrator held that although Ms. O’Connell’s name remained on the bank account and share certificates for Qualisult, the day-to-day operation of the business and its financial management were exclusively assumed by Mr. Awada. For example, among other things, Mr. Awada was listed as the sole shareholder of Qualisult on tax returns and was paid dividends as though a shareholder.
[67] A valuation of Qualisult was not available to the Arbitrator, and as such, the only opinion evidence that was presented to her regarding its value on the valuation date was an adjusted book value reflected in the corporate financial statement which, according to the expert witness Mr. Pittman (as detailed in his Income Assessment Report), provided a value of $61,374.00. Absent other evidence, the Arbitrator accepted the book value disclosed by Mr. Pittman and found the value of Qualisult at the valuation date to be $61,374.00.
Promissory Notes:
[68] The Arbitrator held that the financial records provided by Mr. Awada to Mr. Pittman demonstrated a number of inconsistencies and false reporting. A separate expert, Mr. Clarke, was retained by Mr. Awada. The crux of the difference between the calculations of the two experts was the total of “unexplained” income. In coming to a decision, the Arbitrator considered the evidence of the two experts, Mr. Pittman and Mr. Clarke, as well as spending patterns. Mr. Awada’s income was assessed in light of the historical income he generated, the financial information presented by Mr. Awada during the hearing, and evidence filed in financial statements. The financial statements were based on information provided by Mr. Awada to a professional who prepared his financial statements.
[69] These financial statements were interpreted by Mr. Pittman based on financial information available to him.
[70] The Court finds that it was open to the Arbitrator to impute income to Mr. Awada, and further, that the Arbitrator was allowed to rely on evidence of Mr. Pittman, as an expert witness with greater weight than the evidence of a particular party. It is not the role of an appellate court to second-guess weight to be assigned to various pieces of evidence (see: Housen, at para. 23). In coming to her decision, the Arbitrator considered the positions of the parties, financial records, as well as the adjusted book value calculated by Mr. Pittman; which, she acknowledged as not representing a formal valuation. Accordingly, the Court finds that the Arbitrator made no palpable and overriding error when she accepted the book value of Qualisult as presented by Mr. Pittman.
[71] With regard to the promissory notes, again, it was open to the Arbitrator to determine a reasonable level of income to attribute to Mr. Awada based on the evidence before her, which she did.
[72] The Court finds that the Arbitrator relied on the best financial information available to her at the time of the hearing. The Court is not prepared to second guess the finding of the Arbitrator about the aforesaid evidence.
[73] Therefore, the Court finds that there was no palpable and overriding error, and as such, her finding that a reasonable level of income to attribute to Mr. Awada in 2016 is $130,000 is upheld.
Issue 4: What income should be attributed to the Respondent for the purpose of calculating prospective child and spousal support?
Appellant’s Position
[74] It is Mr. Awada’s position that the Arbitrator erred in not imputing a more substantial income to Ms. O’Connell despite her findings that Ms. O’Connell did not begin to seek employment until approximately 2.5 years following their separation, and finding that Ms. O’Connell did not take reasonable or appropriate steps to address her obligation to contribute to her own support and that of the children. As such, the Arbitrator erred in failing to impute an income to Ms. O’Connell of at least $35,000.00.
[75] In support of his position, Mr. Awada argues that support obligations will not be reduced or cancelled in the event that under or unemployment is the result of one’s own actions; that a parent cannot avoid support obligations for these reasons (see: Silva v. Queiroz, 2016 ONCJ 522, at para. 29; Drygala v. Pauli (2002), 61 O.R. (3d) 711 (C.A.), at para. 38).
[76] Further, Mr. Awada points to principles set out in Silva, at para. 23, namely, that the fundamental obligation of a parent is to support their children, which takes precedence over their own interest; that parents are act in a fiscally responsible manner; that to impute income is discretionary; and that a parent will not be excused from child support obligations in furtherance of unrealistic or unproductive career aspirations.
Respondent’s Position
[77] Ms. O’Connell points to the following findings made by the Arbitrator in examining her ability to earn income and ultimately imputing an income of $10,500.00 (2016), and $18,000.00 (2017):
a. During the marriage she had her hands full raising three busy and active boys;
b. When the marriage dissolved, Ms. O’Connell needed to rethink her situation and recognized that she had an obligation to take reasonable steps to contribute to her own support and that of the children;
c. It is reasonable to give a stay-at-home spouse time to consider her options and determine an appropriate professional path, particularly when absent from the workforce for an extended period of time;
d. Ms. O’Connell should have started making a concerted effort to find employment after a year’s separation;
[78] The evidence upon which the Arbitrator relied included Ms. O’Connell’s education and employment history, the length of time the parties cohabited and number of children, her role in the family, her age, the length of time that she was away from the workforce, activities and requirements of the children, her earnings and assets, when she started applying for jobs and her workplace aspirations.
[79] Ms. O’Connell argues that an arbitrator’s determination would include consideration of whether she took reasonable steps to obtain employment commensurate with such factors as age, health, education, skills and work history. The Arbitrator would have also considered the economic disadvantage arising from the marriage and its breakdown, any effect from post-separation child care responsibilities and hardship created by the breakdown (see: D.B.B. v. D.M.B., 2017 SKCA 59, at paras. 68-69).
[80] Furthermore, Ms. O’Connell states that deference regarding the imputation of income is owed to the Arbitrator unless their reasons disclose an error in principle, significant misapprehension of evidence, or unless the award is clearly wrong (Hickey v. Hickey, [1999] 2 S.C.R. 518, at para. 11).
Analysis
[81] In calculating what income should be attributed to Ms. O’Connell, the Arbitrator held that Ms. O’Connell did not take reasonable and appropriate steps to address her obligation to contribute to her own and her children’s support following her separation, and accordingly, imputed income for the 2016 and 2017 calendar years. The Arbitrator turned her mind to the legislation, the Spousal Support Advisory Guidelines, as well as the following factors: (i) the strength of the compensatory claim; (ii) the recipient’s needs; (iii) the needs and ability to pay of the payor; (iv) work incentives for the payor, (v) property division and debts; and (vi) self-sufficiency incentives.
[82] In considering Ms. O’Connell and Mr. Awada’s respective roles during the marriage, and their current financial circumstances, the Arbitrator held that Ms. O’Connell be entitled to support given the economic disadvantage that came from the marriage and hardships that followed. In the case of support orders, absent an error in principle, misapprehension of evidence, or unless an award is wrong – appeal courts should not overturn them (Hickey, at para. 11). In this case, the Arbitrator acknowledged Ms. O’Connell’s failure to take appropriate steps to become self-sufficient following her marriage breakdown and imputed income accordingly. A support order was then granted having regard to the aforementioned factors. Therefore, the Court finds that the Arbitrator acted appropriately, and made no overriding or palpable error.
Conclusion
[83] For the reasons set out above, the Court finds that:
the Arbitrator did not commit an error of law, nor an error of mixed fact and law in including the Laurier Avenue Property in Mr. Awada’s NFP calculation;
the Arbitrator did not commit an error of law, nor an error of mixed fact and law in including the Palmerston Drive Property in Mr. Awada’s NFP calculation;
the Arbitrator did not commit an error of mixed fact and law in imputing income related to promissory notes and Qualisult to Mr. Awada for the purposes of calculating prospective child and spousal support;
the Arbitrator did not commit an error of mixed fact and law in the amount of income imputed to Ms. O’Connell, nor in the order for spousal support; and
the error that Mr. Awada alleges regarding the Arbitrator’s quantification of support, noted at paragraph 4 (d) of this Decision, fails because this Court found no errors made regarding the incomes of the parties.
Costs
[84] Neither party provided cost outlines. The Court asked the parties how much they were claiming in costs. Mr. Awada, now self-represented, said that he did not know. Mr. Kenny stated that his claim for costs on a full indemnity basis were $14,600 plus HST for a total of $16,498.00.
[85] The issue of costs is in the discretion of the Court pursuant to s. 131 of the Courts of Justice Act, R.S.O. 1990, c. C. 43, and Rule 57.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
[86] Based on the findings made herein, the Court finds that Ms. O’Connell was successful on all of the issues.
[87] The Court finds that the quantum claimed for costs on a full indemnity basis is appropriate. The Court does not find the conduct of either party inappropriate in relation to this appeal.
[88] Notwithstanding the above, the Court finds that costs should be awarded on a partial indemnity basis. The Court assesses the costs at $8,760.00 plus HST for a total of $9,899.00. The amount is to be paid by Mr. Awada to Ms. O’Connell within 30 days.
[89] Order to issue accordingly.
Mr. Justice Stanley Kershman Released: January 10, 2019