Soleimani v. Melendez, 2019 ONSC 36

Court File and Parties

COURT FILE NO.: FC-17-52821-00 DATE: 20190102 ONTARIO SUPERIOR COURT OF JUSTICE FAMILY COURT

BETWEEN: Fereshteh Soleimani Applicant – and – Amadeo Melendez Respondent

COUNSEL: Mr. E. Starer, for the Applicant Amadeo Melendez, Self-Represented

HEARD: December 4-6, 2018

REASONS FOR DECISION

CHARNEY J.:

Introduction

1This motion to change is brought by the applicant mother. She seeks an order increasing child support in accordance with the respondent father’s income and the Canada Child Support Guidelines (CSG), and to require the father to pay s. 7 expenses on a pro rata basis in accordance with his income.

2The respondent father brings a cross-motion to reduce his child support payments on the basis of hardship. The father has two subsequent children from a different mother. This other family resides in El Salvador, and the father is paying voluntary child support to those children. He also seeks to change the applicant mother’s sole custody to joint custody.

Facts

3The parties were married on August 17, 2001, and separated on August 7, 2008. They were divorced on July 19, 2012.

4There are two children of the marriage. The first was born on March 27, 2002, the second on August 12, 2005.

5A final consent order was made on May 2, 2012, establishing the following terms:

i. The mother was given sole custody of the children; ii. A detailed access schedule was established. The father was responsible for half of the transportation for access; iii. The father was ordered to pay child support in the amount of $758 per month in accordance with the CSG, based on an annual income of $51,000; iv. The child support payments were subject to annual adjustment based on the father’s previous year’s income; v. The children were to be maintained on the father’s health and medical benefits through his employment and the mother was authorized to send the receipts to the insurance company and receive the cheque from them directly; vi. Spousal support terminated on August 30, 2012; vii. The equalization payment was settled; viii. The father was “entitled to a credit for future s. 7 expenses of $4,000”; and ix. The mother, who lived in Newmarket, was not allowed to move further away from the father, who lives in Mississauga “other than a move to the City of Toronto”.

6The father has been paying child support of $758 per month through his employer, and there are no arrears owing on that amount.

7The father’s other family includes two children who were born on June 1, 2014 and April 7, 2016. The father met the children’s mother in 2013, when he returned to El Salvador for his father’s funeral. That family still lives in El Salvador, and the father visits them every year. The children’s mother is a citizen of El Salvador.

Analysis

i) Child Support

8The father has provided his income since 2012. His income for each year is:

i. 2012 - $53,487 ii. 2013 - $52,902 iii. 2014 - $56,834 iv. 2015 - $54,396 v. 2016 - $57,943 vi. 2017 - $56,667

9This income is based on his notices of assessment for the relevant years. $1,333 was deducted from his annual income in each year because that amount was added to his income as repayment for the $20,000 that the father withdrew from his RRSP to purchase the matrimonial home under the Home Buyer’s Plan. According to the terms of the Home Buyer’s Plan, $1,333 must be attributed to his income every year as repayment of that $20,000 RRSP withdrawal. I accept the father’s position that this annual “repayment” should not be counted as income for child support purposes. The applicant withdrew this money before the couple separated, and the money was used to help pay for the matrimonial home, which was already the subject of an equalization payment under the Family Law Act. This annual repayment is not really income, but the repayment of a loan from his RRSP, which is nominally attributed to his income for tax purposes. The government is counting untaxed income earned in past years so that it can be taxed. It should not be counted as income for the purposes of child support.

10In addition to the income for the years stated above, the applicant has provided a letter from his employer, dated October 26, 2017, stating that his annual salary based on a 40 hour week is $53,164. This does not include the $1,333 RRSP repayment.

11In D.B.S. v. S.R.G., [2006] 2 S.C.R. 231, 2006 SCC 37, the Supreme Court of Canada decided, at para. 125, that, as a general rule, and subject to blameworthy behaviour on the part of the payor, “it usually will be inappropriate to make a support award retroactive to a date more than three years before formal notice was given”: Gray v. Rizzi, 2016 ONCA 152, at paras. 45 and 61.

12In this case the only date of notice on record was the date that the motion to change was served on the father, which was March 23, 2017. Accordingly, retroactive child support may be ordered for the years 2014, 2015, and 2016, as well as 2017. The father has paid the court ordered child support since that order was made in 2012, and no argument was advanced that the father has engaged in blameworthy behaviour that would merit a longer period of retroactivity.

13On this basis the mother’s claim would be as follows:

Year	Annual Income	Monthly Support Owed	Monthly Support Paid	Total Arrears for year
2014	$56,834	$845	$758	$1,044
2015	$54,396	$808	$758	$600
2016	$57,943	$861	$758	$1,236
2017	$56,667	$842	$758	$1,008
2018	$53,164	$788	$758	$360

14Subject to the respondent father’s claim of undue hardship, his total arrears for these years would therefore equal $4,240.

15The father claims undue hardship based on the support that he has been sending his children in El Salvador.

16Section 17(4) of the Divorce Act requires that before varying a child support order, the court must satisfy itself that there has been a change of circumstances as provided for in the CSG since the making of the existing order.

17The evidence filed by the father is that he pays approximately $400 - $500 per month to his family in El Salvador. He argues that since these children were born after the May 2012 court order, they qualify as a material change in circumstances.

18He makes two arguments with respect to these children. First, he argues that the child support payments he makes to his children in El Salvador should be considered as “undue hardship” under s. 10 of the CSG.

19Secondly, he argues that his child support under the CSG should be calculated on the basis of his total income based on four children (the two in Ontario and the two in El Salvador) and divided between the two families. For example, his income for 2017 was $56,667, and the CSG require $1301 for four children. If he were to divide this amount between his two families, he would have paid the respondent only $650 instead of the $758 he did pay. If this method of calculation is accepted, he argues, he has made substantial overpayments to the respondent since his children in El Salvador were born, and she owes him over $2,500.

20The father’s argument that his support obligations should be calculated on the basis of combining all four of his children from both families can be dealt with summarily. Section 3 of the CSG provides that the amount of child support under the CSG is the amount set out in the applicable table according to the number of children to whom the order relates and the income of the spouse against whom the order is sought. Section 2(1) of the CSG defines “child” as “a child of the marriage”. The ordinary and grammatical meaning of this definition is that child support is based on the number of children from the marriage with the spouse claiming support, and does not include children from other marriages or other relationships. Children from more than one marriage or relationship cannot be combined for the purposes of calculating child support under the CSG Table.

21This interpretation is confirmed by s. 10(2) of the CSG, which permits the court to deviate from the amount ordered under the guidelines if the payor can prove undue hardship because he has a legal duty to support a child other than a child of the marriage. The relevant provisions of s. 10 read:

Undue hardship

10. (1) On either spouse’s application, a court may award an amount of child support that is different from the amount determined under any of sections 3 to 5, 8 or 9 if the court finds that the spouse making the request, or a child in respect of whom the request is made, would otherwise suffer undue hardship.

Circumstances that may cause undue hardship

(2) Circumstances that may cause a spouse or child to suffer undue hardship include the following,

(d) the spouse has a legal duty to support a child, other than a child of the marriage, who is,

(i) under the age of majority, …

22If Table child support were calculated as proposed by the father, s. 10(2)(d) would be redundant. It is clear from reading sections 2, 3 and 10 of the CSG together, that child support issues arising from second families are dealt with under the rubric of undue hardship rather than as Table calculations: see D.A. Rollie Thompson, The Second Family Conundrum in Child Support, (2001) 18 Can. J. Fam. L. 227 – 268; Elliot S. Birnboim and Daniella Murynka, Section 9 and Second Families, 2015 93-1 Can. Bar Rev. 39, 2015)(d) of the CSG? That provision applies when the payor “has a legal duty to support a child, other than a child of the marriage”.

24The father argues that the children of his second relationship should be treated equally to the children of his first relationship. While he cannot point to a legal duty to support them, he has a moral obligation to support them. He – and his children in El Salvador - should not be disadvantaged because he has voluntarily accepted this moral obligation rather than forcing the mother of these children to take him to court and obtain a court order.

25Ontario courts are generally guided by what has been referred to as the “first-family-first” principle. In Fisher v. Fisher, 2008 ONCA 11, at para. 39, the Ontario Court of Appeal stated:

While courts generally recognize a “first-family-first” principle (which provides that a payor’s obligations to the first family take priority over any subsequent obligations), inevitably new obligations to a second family may decrease a payor’s ability to pay support for a first family.

See also: Dean v. Dean, 2016 ONSC 4298, at paras. 81 - 83.

26As explained in Fisher, an obligation to a second family “must be considered in context”.

27Fisher was a case about the Spousal Support Advisory Guidelines (“SSAG”), and did not deal with s. 10 of the CSG. Numerous cases have recognized that the needs of a second family can be a factor in ordering spousal support at the lower end of the SSAG ranges: see Gray v. Gray, 2014 ONCA 659, at para. 45; Castedo v. Haldorsen, 2016 ONSC 3870, at paras. 90 - 99 and cases cited therein; Watson v. Watson, 2017 ONCJ 24, at para. 81. There are, however, few Ontario cases in which CSG Table support has been reduced on that basis.

28While the respondent father is to be commended for assuming financial responsibility for his children in El Salvador, this support is not, on the record before me, a legal duty. This is an important consideration for two interrelated reasons. Firstly, s. 10(2)(d) expressly requires that the spouse have a legal duty to support the other child(ren). Second, in the absence of a legal duty, if an order were made reducing child support because of undue hardship related to such payments, there would be nothing to stop the father from unilaterally reducing or discontinuing the payments to El Salvador, yet continuing to benefit from the reduction of support in Ontario.

29In the same vein, the amount of support paid toward the children in El Salvador - $400 – $500 per month – is an amount chosen unilaterally by the father. There is no evidence before me as to how this amount was determined. The children’s mother – who the respondent describes as his common law wife – does not work. She lives at a property owned by her mother and does not pay rent. The respondent testified that her monthly budget was approximately $US500 per month, but no budget break down was provided. The respondent agreed on cross-examination that the cost of living in El Salvador was much less than in Canada. He also stated that the unemployment rate is much higher and there is no welfare.

30The evidence before me on this motion is not sufficient to persuade me that the monthly support sent to El Salvador is an appropriate amount, given the lower cost of living and the fact that the children’s mother does not pay rent. While the respondent has every right to be generous in the support of his El Salvador family, the “first-family-first” principle means that his generosity cannot be funded at the expense of his children from his first marriage.

31Accordingly, the respondent has not established that payment of the CSG Table amount will result in undue hardship. Either s. 10(2)(d) of the CSG does not apply because the support payments made to El Salvador are not paid pursuant to a legal duty, or the evidence has failed to persuade the court that the respondent, or his children in El Salvador, will suffer undue hardship if the full Table amount is paid.

32The father has also claimed that any support award should be set-off against a loan of $18,600 that the he alleges he made to his ex-wife for her family in 2006. For there to be a variation of the May 2, 2012 order under s. 17 of the Divorce Act, the court must find there to be a change in circumstances “since the making of the order” in question. I cannot go behind the order or examine circumstances that arose prior to the making of the order: see Gray v. Rizzi, at para. 28. Assuming that the applicant made such a loan to his ex-wife in 2006, the applicant should have addressed any repayment or set-off by the respondent in the equalization and/or spousal support orders that were made in May 2012. This issue cannot be raised in this proceeding.

33Finally, the father claims that the mother has remarried, and that I should take into account her spouse’s income when considering the respective incomes of the two families. The mother denies that she is married or living with the person the father alleges to be her husband. The respondent father has not proven on a balance of probabilities that the mother has remarried, and I decline to give further consideration to this argument.

ii) Section 7 Expenses

34The applicant mother claims over $25,000 for s. 7 “Special or Extraordinary Expenses” since 2012. She seeks an order that the respondent is responsible for 66% of these expenses, since his income is approximately $50,000 per year and hers is approximately $25-30,000 per year.

35The onus is on the parent seeking the special or extraordinary expenses to prove that the claimed expenses fall within one of the categories under s. 7 of the CSG and that the expenses are necessary and reasonable, having regard to the parents’ respective financial circumstances. Section 7 requires the court to consider whether the spouse against whom the claim is made had been consulted about the expenses before they were made, and whether the spouse has the means to make the contribution to the expenses. Where the expense is not within the means of the parties, the court may limit or deny recovery of that amount: See Park v. Thompson, 2005) 601 (Ont. C.A.), at paras. 20 - 26.

36A custodial parent does not have carte blanche to enroll a child in any number of extra-curricular activities and then look to the non-custodial parent to share all of the costs. While prior consultation is advisable, and is a factor that the court will consider in assessing a claim under s. 7, prior consent is not a legal prerequisite to a s. 7 claim unless specifically required by agreement or court order: Zimmerman v. Doe, at paras. 5, 8, 10 and 11.

37In Titova v. Titov, 2012 ONCA 864, the Ontario Court of Appeal provided the framework for determining whether a recipient of child support will receive contribution towards a s. 7 special or extraordinary expense. The court stated, at para. 26:

In awarding s. 7 special and extraordinary expenses, the trial judge calculates each party’s income for child support purposes, determines whether the claimed expenses fall within one of the enumerated categories of s. 7 of the Guidelines, determines whether the claimed expenses are necessary “in relation to the child’s best interests” and are reasonable “in relation to the means of the spouses and those of the child and to the family’s spending pattern prior to the separation.” If the expenses fall under s. 7(1)(d) or (f) of the Guidelines, the trial judge determines whether the expenses are “extraordinary”. Finally, the court considers what amount, if any, the child should reasonably contribute to the payment of these expenses and then applies any tax deductions or credits.

38An order for contribution to special and extraordinary expenses under s. 7 of the Guidelines is discretionary as to both entitlement and amount. The court has the discretion to apportion the s. 7 expense in a different manner than pro rata to incomes, depending on the circumstances of the case. See: Salvadori v. Salvadori, 2010 ONCJ 387, at para. 28.

39In Deadman v. Deadman, 2013 ONSC 2890, Olah J. concluded that karate and music classes were extraordinary expenses for the children in that case. In coming to that conclusion she stated, at para. 34:

I must also assess the parties’ incomes and examine the means of both parents, in determining whether the expenditure is reasonable in the circumstances. In doing so, I must review the amount of the expense, the nature and number of the activities; the special needs and talents of the children; the history of the payment for such expenses.

40See also: Botting v. Arbogast, 2011 ONCJ 815, at para. 27; McLean v. Castillo, 2016 ONSC 215, at para. 9.

41Other cases have declined to include karate classes as extraordinary expenses given the circumstances in those specific cases: See Davis v. Davis, 2018 ONCJ 53, at paras. 68 and 70; Magee v. Faveri, [2007] O.J. No. 4826, at paras. 32 and 41.

42The s. 7 expenses claimed by the applicant are comprised of the following:

1. $2,492 for music lessons for both children in 2016;
2. $22,600 for karate lessons for both children from 2012 to 2016 ($4,520 per year);
3. $176.40 for swimming lessons for both children for April 2016;
4. $65 for music festival registration in May 2015;
5. $110 for physiotherapy for one child in November, 2016;
6. $94.92 for musical instrument rental in November 2016;
7. $44.06 for musical instrument rental in March 2015;
8. $113 for musical instrument rental in September 2016;
9. $80 for a waterproof cast for one child (not covered by OHIP) in November 2014;
10. $147 for dental treatment in January, 2015. The applicant was unable to confirm whether this invoice related to work done on a child or the applicant, since neither child’s name appears as a patient;
11. $329 for glasses for one child in November 2016;
12. $10 for a splint for one child (not covered by OHIP) in December 2014;
13. $175 for an air cast for one child (not covered by OHIP) in November 2016;
14. $62 for chiropractic services for one child in October 2016; and
15. $354 for dance for one child for 2014/2015.

43The applicant testified that the respondent had not provided any contribution to these expenses, although she conceded that she had not sent any of these receipts to him.

44Indeed, it is unclear whether the respondent ever received these receipts before the trial began. The mother did file as an exhibit an email from her former lawyer’s law clerk, dated October 19, 2017, to the respondent, stating:

Please find enclosed receipts for the children’s expenses. Mr. White [her former lawyer] had mentioned that you had not received these receipts and asked that I forward them to you.

45Unfortunately, the law clerk’s email did not itemize the receipts that were appended nor provide a total of the amount claimed. The receipts themselves were not appended to the email filed as an exhibit, nor did the law clerk provide an affidavit to identify which receipts were appended. Accordingly, I have no evidence as to what was appended to the law clerk’s email.

46The applicant’s counsel stated his understanding that the receipts that were made exhibits, plus some other receipts that were not made exhibits because they did not in fact relate to the children’s expenses, were the receipts appended to the law clerk’s email. Counsel’s understanding is not evidence.

47Another concern is that the biggest receipt – the $22,600 for karate lessons for both children from 2012 to 2016 – is not an actual receipt, but a single piece of paper from “Rosenberg Centre for the Defensive Sciences” listing the years 2012 to 2016, and stating that $4,520 was received each year. There are no receipts for the actual years in which the expenses were allegedly incurred, and it is unclear when this document was created or who made it. There are no credit card or other bank records to confirm that these amounts were actually paid. That is not the kind of evidence I would expect for a claim for $22,600.

48In any event, there is no dispute that the earliest the respondent received any of these receipts was October 19, 2017. Even assuming that he received all the receipts claimed by counsel for the applicant, it is conceded that at least some of the receipts emailed to him that day were not related to s. 7 expenses.

49The respondent father makes three arguments in response to the s. 7 claim.

50The first is that his s. 7 expenses are limited to the $4,000 “credit for future s. 7 expenses” referenced in para. 16 of the May 2012 Order.

51This is a misinterpretation of para. 16 of the May 2012 Order. There is nothing in that paragraph that limited his future s. 7 expenses to $4,000. When the order was made in 2012, the respondent father had made an overpayment of $4,000 in child support by virtue of an earlier court order dated August 7, 2009 that had set his child support at $961 per month. The August 7, 2009 Order was overturned in a subsequent decision and court order dated March 15, 2010, which reduced his child support to $744 per month. The intent of para. 16 of the May 2012 Order was to reimburse the respondent father for that overpayment.

52Accordingly, the intent of the May 2012 Order is that, as the respondent father is given receipts for s. 7 expenses, the first $4,000 of his contribution to those s.7 expenses will be credited against the child support overpayment dating back to the August 7, 2009 Order.

53The difficulty, however, is that the applicant did not provide the respondent with receipts for s. 7 expenses as they arose. She saved them up, and provided him with in excess of $25,000 of expenses in October 2017, and is now before the court seeking retroactive s. 7 expenses.

54The respondent’s second argument relates to the medical, eyeglasses and other health care expenses. If the respondent father had been given the receipts in a timely way, he could have forwarded the receipts to his employment health insurer, and the expenses would have been paid by the insurer. In the alternative, the service provider can be asked to submit the receipts directly to the insurance company. The applicant did neither.

55The applicant explained that she refused to give the father the receipts because she wanted the insurance cheques to come directly to her. She believed that if the receipts were given to the father, the father would make the insurance claim but keep the money from the insurance company for himself. There is no evidence that the father has ever done such a thing.

56The applicant mother also points to the May 2012 Order, which authorized her to send the receipts to the insurance company and receive the cheque from the insurance directly. The difficulty with that, however, is that the Order could not bind the insurance company, which was not a party to the Order. The father explained that, subsequent to that order, his employer changed the health insurance company from Manulife to Greenshields, and the new insurance company requires that all reimbursements be made to the Plan Holder – in this case the father. The father has provided a copy of a letter from his employer dated September 19, 2017 confirming this policy, and this letter was shared with the applicant’s previous counsel prior to trial.

57The respondent’s third argument is that certain of these expenses – in particular the $4,520 per year for karate classes - are beyond his means. He was never consulted in advance about any of these expenses, and given his limited means and support obligations to his other children, he cannot afford to pay for these extra-curricular activities.

Conclusion: Retroactive s. 7 Expenses

58I am not prepared to order any retroactive s. 7 expenses in this case for the following reasons:

59The applicant did not consult with the respondent before any of the extracurricular expenses (music, dance and karate) were incurred, nor did she provide him with invoices or receipts or request that he make a contribution as the expenses were incurred. In these circumstances it would be unfair to force him to contribute to these costs on a retroactive basis.

60Moreover, given the respondent’s limited financial means, it would be devastating to require him to make a payment for these expenses on a retroactive basis. In this regard, I am permitted to consider the voluntary support payments made to his children in El Salvador, since ability to pay under s. 7 of the CSG is both broader and a lower bar than “undue hardship” under s. 10.

61In addition, the evidence presented in support of the karate claim is inadequate to show that the expense was actually incurred.

62Under normal circumstances I would allow the medical and health related expenses on a retroactive basis, even in the absence of consultation with the spouse against whom the order is sought, since such expenses are not discretionary in the same way as extracurricular activities like karate and music. In this case, however, the applicant’s failure to provide the receipts to the respondent in a timely manner so that he could submit them to his health insurer for reimbursement disentitles her to bring the claim now. The respondent has been prejudiced by the applicant’s unjustified delay.

63In future, the applicant may request that invoices for medical and health related expenses be submitted by the service provider directly to the insurance company, where this is available, or the receipts must be provided to the respondent in time for him to claim the expense from his health insurer. The respondent will then reimburse the applicant for the cost of the insured service to the extent that he is reimbursed by the insurer. If the applicant follows this procedure and is not reimbursed by the respondent, she may bring a motion to the court.

Conclusion: Prospective s. 7 Expenses

64On a prospective basis, given the respondent’s limited financial means, it is reasonable for him to decline to contribute to the expense of the karate classes, and it would be unfair to impose an additional expense of almost $3,000 (66% of $4,520) per year for this activity.

65On the other hand, the evidence indicates that the children do have some musical talent. If the children continue with music or dance classes, these are reasonable extraordinary s. 7 expenses, and the respondent is responsible for 60% of these expenses on a prospective basis. I have decided on the 60% figure taking into account the parties’ respective incomes and the respondent’s financial obligations to his family in El Salvador. This percentage is subject to change if the applicant mother’s income increases if she returns to work.

66The applicant should consult with the respondent before any future s. 7 expenses are incurred, but the respondent’s consent cannot be unreasonably withheld.

67To the extent that the applicant has s. 7 expenses as set out above, she must provide the respondent with a receipt or invoice proving that payment has been made.

$4,000 Child Support Credit

68Given my decision not to order any retroactive s. 7 expenses, the respondent still has a $4,000 child support credit in accordance with the May 22, 2012 Order. According to the May 22, 2012 Order, this credit was to be used to offset future s. 7 expenses. Given that the respondent now has child support arrears of $4,240, it makes more sense to use the $4,000 child support credit to offset the $4,240 child support arrears, effectively reducing his child support arrears to $240. To be clear, this means that the respondent is responsible for 60% of reasonable s. 7 expenses on a go-forward basis.

Custody

69The respondent has asked for an Order changing the mother’s sole custody to joint custody. Such orders may only be made if they are in the best interest of the children. There must also be evidence of a material change in circumstances since the granting of the consent order in May, 2012.

70While the respondent complained that he has not had access with the children for nearly two years, the evidence does not satisfy me that a change in custody is either the best way to address the access issue or would be in the best interest of the children on a more general basis. If there is an issue with access, that should be addressed by a motion to enforce access. The older child is almost 17 years of age; the younger child is 13 years of age. The record before the court does not support the respondent’s position that a change in custody will assist the respondent to re-establish access with his two children.

Conclusion

71This Court Orders:

i. The father will pay child support, including retroactive child support, in accordance with the chart set out at para. 13 above. The father has a $4,000 child support overpayment credit from 2012. This credit will be applied to the arrears calculated in para. 13 above, leaving child support arrears of $240 to be paid by the respondent father. Child support in future years will be adjusted based on his previous year’s earnings, and will be set at $788 per month commencing January 1, 2019, and continuing on the first day of the month thereafter. ii. The father will be responsible for 60% of future s. 7 expenses. iii. The applicant must consult with the respondent before any future s. 7 expenses are incurred, but the respondent’s consent cannot be unreasonably withheld. iv. To the extent that the applicant has s. 7 expenses she must provide the respondent with a receipt or invoice proving that payment has been made. v. The applicant may request that invoices for medical and health related expenses be submitted by the service provider directly to the insurance company, where this is available, or the receipts must be provided to the respondent in time for him to claim the expense from his health insurer. The respondent will then reimburse the applicant for the cost of the insured service to the extent that he is reimbursed by the insurer.

72If the parties cannot agree on costs, the applicant may serve and file costs submissions by February 1, 2019 of not more than three pages plus costs outline and any offers to settle, and the respondent may serve and file responding submissions on the same terms by February 18, 2019. All costs submissions (but not books of authorities if filed) are to be filed in the Continuing Record.