COURT FILE NO.: FS-17-90445-00
DATE: 2019 10 08
CORRECTED: 2020 01 28
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
David Shaw Wardlaw
Applicant
- and -
Jana Wardlaw
Respondent
E. Iacobelli, Counsel for the Applicant
Self-Represented
HEARD: January 7-11, 2019
REASONS FOR DECISION
Correction Notice
January 28, 2020: Minor typographical error to the front page “HEARD” date. The heard date on the original endorsement dated October 8, 2019 has been changed from June 26th, 2018 to January 7-11, 2019.
LEMAY J
[1] The Applicant, David Wardlaw, and the Respondent, Jana Wardlaw were married on July 21st, 2000. They separated on July 26th, 2017, and have been living separate and apart in the matrimonial home since that time.
[2] The parties have been married for seventeen (17) years, but have no children. The disputes in this case involve the division of Net Family Property, spousal support and other financial issues. There are, however, a series of disclosure issues, and arguments advanced by the Respondent that have provided a layer of complexity to this case.
[3] In these reasons, I will refer to the parties by their first names for two reasons. First, they share a last name. Second, as will be seen, David’s parents, George and Fern Wardlaw, also have some involvement in this case, although neither of them testified.
Issues
[4] At the outset of the trial, I identified the following issues that had to be resolved:
a) Equalization of Net Family Property (“NFP”).
b) Spousal Support.
c) Possession of the matrimonial home.
d) Non-Harassment orders.
e) Costs.
[5] In addition, there is a dispute over whether a divorce should be issued in this case. David seeks a divorce. Jana does not want a divorce until a number of different issues are investigated and resolved. I will address the question of whether a divorce should be granted as a preliminary issue, once I have set out some of the relevant background facts.
[6] I also note that the equalization calculation is done before spousal support as the amount of the equalization payment, and its impact on income generation, will almost invariably affect the support analysis. Greenglass v. Greenglass 2010 ONCA 675.
Background Facts
a) The Parties
[7] The Applicant David is currently 57 years old. At the time of separation, he was 55 years old. He has not completed high school, and worked on his parents dairy farm for his entire working career.
[8] The dairy farm, which was known as Humberside Farms was located in a rural part of the City of Vaughn, in the general area of Kleinburg. His parents, Fern and George Wardlaw, operated this farm for a considerable period of time.
[9] In 1995, there was a land transfer between David, Fern and George. I am not aware of the details, but the records show a transfer to David of a one third interest in the farm property for a nominal amount of $8.00. The parties continued to farm the property. They had a herd of cattle, as well as milk quota so that their milk could be sold commercially.
[10] Jana Wardlaw is currently 51 years old. She was 49 as of the date of separation. She has finished high school, as well as having been qualified as an optician in Germany in the late 1990’s. Jana came to Canada from Germany in 1999. She was here on a one year visitor’s visa, and spent time in Ontario and Alberta.
[11] The parties met in 1999. Each of them have a different version of how they came to be married in 2000.
[12] David says that he married Jana in order to allow her to remain in Canada, as she was about to be deported to Germany.
[13] Jana testified that she was going back to Germany, when David gave her a tour of his dairy farm in an effort to get her to marry him and stay in Canada. She says that she agreed to marry him.
[14] In order to resolve the issues in this case, it is not necessary for me to decide why the parties came to be married. It is sufficient that they were married for a period of seventeen years.
[15] Since the marriage, Jana has worked outside of the home for a period of three years. She testified that she left this job to care for David when he had medical issues. I will return to this issue in the section on spousal support, below.
[16] David has not worked outside the home in any significant way since the dairy farm was sold at the end of 2006.
b) The Dairy Farm, Investments and the Matrimonial Home
[17] The Wardlaw family farm had been in the family for a great many years. In 2006, the farm was sold by George, Fern and David for the sum of $19 million. Part of the proceeds of sale came in the form of a cash payment, and part was in the form of a vendor-take-back mortgage. There are issues that Jana has raised about the sale of this property, which I will return to in my discussion of NFP below.
[18] There was litigation over the sale of the farm between David and his parents. I understood that this litigation was driven by the fact that David did not want to leave the farm, and Fern and George wanted to have it sold. Ultimately, this litigation was resolved with the sale of the property. I am not aware of the precise details of how the litigation was resolved.
[19] After the farm was sold, I understand that David and Jana continued to live on the farm for a period of a year or two as tenants. They were searching for another farm property to purchase.
[20] Ultimately, a property was purchased at 19704 Heart Lake Road in Caledon. This property was paid for by David out of his share of the proceeds from the sale of the dairy farm, and David was the only party who went on title. Jana argues that it was always the intent of the parties that she go on title, and she is claiming a trust remedy. I will return to this issue in the discussion of NFP.
[21] In addition, David had considerable investments that are managed through an investment advisor at RBC Dominion Securities (“RBC”) in Vaughan. In 2012, David engaged in a “spousal loan strategy” suggested by RBC in order to save on taxation. He transferred approximately $1 million of his assets to Jana, and she executed a promissory note for that amount.
[22] In this litigation, David has agreed that he will not attempt to enforce the promissory note at any future time, and that the money in these accounts is Jana’s. An Order will issue reflecting that concession.
[23] With this background in mind, I will address a number of procedural points that arose during the trial, as well as the various issues that I have outlined
Procedural Issues
[24] There are two key procedural issues that arose in this case, both relating to disclosure. Those issues are as follows:
a) Ms. Wardlaw’s disclosure brief, and what use should be made of the evidence in that brief.
b) Whether documents that Jana did not disclose in accordance with the Family Law Rules should be received in evidence.
[25] I will deal with each issue in turn.
a) The Disclosure Brief
[26] Jana provided her tax returns and notices of assessment for 2014 to 2016 as part of her disclosure brief. However, in the course of her evidence, she seemed to suggest that these had not been prepared by her and that she had no control over them. This evidence is based, in part, on Jana’s insistence that the investments in her name at RBC Dominion Securities are not hers. Given my conclusions on that issue (set out below), I am prepared to accept her tax returns and notices of assessment as being authentic.
[27] Ultimately, I decided that the tax returns and notices of assessment had been in Jana’s possession, and that I would receive this evidence. I directed that these documents be marked as exhibits, and will now provide my reasons for doing so.
[28] A key issue in this case is spousal support. As a result, the means of both parties are clearly relevant. The evidence of Jana’s income for the last three years is, therefore, necessary. In addition, the tax returns were prepared by an accountant, and Revenue Canada reviewed those returns and prepared notices of assessment based on those returns. Given that these returns had been reviewed and accepted by a third-party government agency, I was of the view that they were also reliable.
[29] In addition, in Jana’s disclosure brief, she had provided statements from RBC that were in her name. The account numbers on these statements were blacked out. These accounts were also listed in Jana’s last sworn financial statement, dated August 31st, 2018. Jana acknowledged in cross-examination that this financial statement was true to the best of her knowledge.
[30] However, when she was asked to confirm that the RBC statements were hers, Jana stated:
THE COURT: All right.
MS. WARDLAW: Like, there’s just essentials and the reason I don’t want to take things out from the Royal Dominion, I don’t want to touch the accounts because it’s unclear with account number 17 and number 18. When I went there to clear them up, with the draft statement, like the – Memo told me I need a court order to open it up, because he’s laughing at me. And at tax time, I had --, I, I showed you the letter that my, my, my tax returns from the Royal Dominion went directly to Mr. Wardlaw and, and the accountant. They were mailed to me and it was even -- I went to the police too.
THE COURT: All right.
MS. WARDLAW: And it was open – like I have no overview and that’s why – it was invested and I don’t want to touch it, because I don’t know if it’s right or dirty money. I don’t, I don’t want to touch it. You understand it?
THE COURT: All right.
[31] At other points in the trial, Jana seemed to suggest that she did not “want” to access the funds in these accounts. There seems to be some question, at least in Jana’s mind, as to whether these accounts are hers or not.
[32] Jana’s testimony that she did not have access to accounts that are in her name does not fit with the normal way in which financial institutions manage accounts. In addition, Jana had copies of these documents which she disclosed. The income that these accounts are generating appears to be listed on Jana’s tax return. Finally, if Jana had wanted to confirm that her version of events was correct, it was open to her to subpoena the investment advisor from RBC.
[33] As a result, I reject Jana’s evidence on this point. She has had access to these funds, and they are hers. She simply did not want to access them during the course of the litigation.
b) Use of Non-Disclosed Documents
[34] During the cross-examination of David, Jana sought to rely on his 2006-2011 notices of assessment. Those notices of assessment outlined that David had made a significantly higher income in those years than he had in the years immediately before separation. David’s counsel objected to the use of these notices of assessment, but offered to attempt to obtain the tax returns from David’s accountant.
[35] I ruled that I was not prepared to permit Jana to cross-examine David on these notices of assessment. In making that ruling, I noted that Jana had been provided with the Guide for Self-Represented litigants by Bielby J. on February 16th, 2018, and she confirmed that she had read it. At paragraph 50, the Guide states:
- Do not forget that you must disclose all documents that you want to use at trial to the other party before the trial: see Rule 19. The failure to disclose evidence before trial could result in a decision of the trial judge to prevent you from calling the evidence, or the trial could be adjourned, or you could be ordered to pay costs.
[36] Jana was aware of her obligations to disclose these documents, and chose not to. In her submissions, she stated the following as the reason she did not disclose these documents:
THE COURT: You have an obligation to disclose it. Why didn’t disclose it?
MS. WARDLAW: I did not disclose it because I was struggling and was hanging on this – my duplication of the paperwork. And then Judge Bielby dismissed me and then I was upset and never- and never went around it, because I was so upset about it. But, but I think it’s – like if, if I ….
THE COURT: But you knew you had an obligation to disclose the documents, right?
MS. WARDLAW: Like, it’s not my documents. It’s his documents. It’s David Wardlaw. We have it at our family home, and they, and they are the lawyer. They, they knew about it, because they did the farm sale. And that’s – my point is what the – they said that they, it’s not only about the farm sale, it’s about – my husband had, had a business, otherwise he would not have those, those numbers. And then the other question is the, the one- for instance I have a Notice of Assessment in the year 2010, and then it says- and then I have – I don’t understand much about accounting. And then I have a statement of account and it says the assessment in 2010 was 307 – 30 – 370 – or $300,000. And the other statement said it was 750,000. Both assessments from 2010, and both from the government. This is one business and one personal? That’s my question on the witness and that’s why ….
[37] In my view, Jana has not provided a reasonable explanation for failing to disclose these documents in advance of the hearing. In addition, Jana stated that these documents were in the possession of the other side. Again, that argument does not assist her, as David’s counsel was not aware that these documents were going to be used in evidence until she had completed her examination-in-chief of David.
[38] As a result, I ruled that the notices of assessment could not be used for cross-examining David. I also ruled that they were not admissible without the tax returns, but that I would receive and consider them if the tax returns were also provided. The reason for this ruling was that it balanced the prejudice suffered by each side, and David’s counsel was prepared to consent to such a ruling.
[39] David’s prejudice comes from the fact that, if the Notices of Assessment were used on their own, they would not provide a complete picture of the evidence. In particular, David’s income was substantially higher in that time period than it is currently, but there was a vendor take back mortgage on the family farm that might have been contributing to David’s income. Jana’s prejudice comes from the fact that she wanted to use these documents to attempt to demonstrate that David was hiding money from her. Reviewing the complete tax returns, if they were available, was the best solution in the absence of an adjournment.
[40] The only tax return from this time period that Ms. Iacobelli was able to obtain was the 2007 tax return. Jana stated that she had the rest “at home” on the Wednesday of the trial. I invited her to bring them to Court for Thursday, but she did not do so.
[41] In reviewing the 2007 income tax return, it is clear why David’s Line 150 income is so much higher in that year than in the three years prior to separation. In 2007, he had net farming income of $449,776.00. This income that stops well before the date of separation. I will return to the significance of this fact below.
[42] Then, there were other documents that Jana sought to tender that were not disclosed. Some of these were received on consent of David’s counsel, and some I did not permit to be used as they were both irrelevant and had not been properly disclosed.
The Divorce
[43] David seeks a divorce. The parties agree that they separated on July 26th, 2017 and, although they have lived under the same roof, they have lived separate and apart since that time. David testified that there is no chance of reconciliation. Jana testified that, after the investigation into the sale of the family farm was done, that they might get back together.
[44] However, David testified that it was Jana’s suggestion to separate and that he was already very tired of the relationship. He wanted a life and found that Jana was alienating him from friends and family.
[45] In my view, the requirements for a divorce are met. Sections 8(1), 8(2)(a) and 8(3)(a) of the Divorce Act state:
- DIVORCE –(1) A court of competent jurisdiction may, on application by either or both spouses, grant a divorce to the spouse or spouses on the ground that there has been a breakdown of their marriage.
(2) BREAKDOWN OF MARRIAGE – Breakdown of a marriage is established on if
(a) the spouses have lived separate and apart for at least one year immediately preceding the determination of the divorce proceeding and were living separate and apart at the commencement of the proceeding; or
(b) the spouse against whom the divorce proceeding is brought has, since celebration of the marriage;
(i) committed adultery or
(ii) treated the other spouse with physical or mental cruelty of such a kind as to render intolerable the continued cohabitation of the spouses.
(3) CALCULATION OF PERIOD SEPARATION- For the purposes of paragraph (2)(a)
(a) spouses shall be deemed to have lived separate and apart for any period during which they lived apart and either of them had the intention to live separate and apart from the other; and
[46] However, Jana challenged the divorce based on the duplication of paperwork, and on the fact that there were two clearance certificates in the file rather than one. At the outset of trial, I advised Jana that she would not be permitted to pursue this issue for a number of reasons that I discussed on the record in Court.
[47] In spite of my ruling, Jana continued to raise the issue of the duplication of documentation and the fact that the clearance certificates in the file had different names on them. As a result, I repeated this ruling on several occasions during the course of the trial. I will explain, again, why it is not necessary for the Court to inquire into these issues.
[48] First, on the duplication of documentation, Jana raised at least two concerns. She argued that there had been two applications that were filed, and she argued that there were irregularities with the list of documents contained in the continuing record. The parties agreed on the substantive list of issues to be determined in this case. As a result, procedural irregularities with the filing of the application, or with the list of items contained in the continuing record were not relevant to any issue I have to determine. As a result, court time should not be wasted inquiring into these issues. Further, the granting of a divorce should not be held up to inquire into these issues.
[49] Then, there was the issue of the clearance certificates. There were two clearance certificates in the file. One certificate used Jana’s maiden name, and used Shaw as David’s first name. Shaw is David’s middle name. The second certificate had the names for the parties that matched their marriage certificate.
[50] The purpose of a clearance certificate is to ensure that there is no other divorce proceeding pending before a Canadian Court. If there is a current clearance certificate that matches the marriage certificate in the file, the Court can be satisfied that there were no other divorce proceedings pending in Canada when this proceeding was started, and a divorce can be issued.
[51] The fact that there are two clearance certificates in a file is not a reason to hold up a divorce as long as there is a clearance certificate that matches the marriage certificate. In this case, the clearance certificate matches the marriage certificate and a divorce will issue thirty-one (31) days after the date that this decision is released.
[52] I also note, briefly, that Jana also alleged that the divorce should not be granted until a full investigation into the sale of the dairy farm was done. As I outline later in these reasons, based on the records I have, I see no basis for inquiring into the sale of the dairy farm any further.
[53] Jana’s insistence that a divorce not be granted raises another issue. In the course of her testimony, when asked why she did not want a divorce, Jana stated:
MS. WARDLAW: It’s like, like even on the court file, even – and I can – I cannot change it.
THE COURT: Right.
MS. WARDLAW: And I complained by the, by the -- the complaint is still pending by the -- at the Law Society of, of – at the Law Society of – do I need to tell you that I don’t, that I don’t want a divorce until all this one is cleared. I have to…
THE COURT: You, you’ve told me that.
MS. WARDLAW: …sum it up? Like just make – just rad it and then I’m done.
THE COURT: And I’ve noted that you don’t want a divorce until all of the confusion over all of the paperwork is cleared up.
MS. WARDLAW: Yes. And that – that, that all the other issues, the – I disagree with the divorce until the, until the Exhibits A and B, they’re under the duplication, until the issues of spousal support, possession of the matrimonial home, the equalization of the family net property, the disclosure, the disclosure of the business assets, the costs, pre-judgment interest and harassment sought….
[54] It is clear from this evidence that Jana wishes to pursue a whole series of issues involving her in-laws and the firm of Prouse, Dash and Crouch. Indeed, in her closing argument she acknowledged as much. The fact that Jana wishes to pursue a series of issues against various other parties should not disentitle David to a divorce either.
[55] In that regard, I note the case law that Ms. Iacobelli provided to me. In McIntosh v. McIntosh ([1993] O.J. No. 2196 (Gen Div)), the Court held that parties who had been living separate and apart for a year or more should be entitled to a divorce regardless of the effects that granting a divorce may have on their finances. In addition, in Cochran v. Cochran ((1996) 1996 CanLII 19766 (ON SC), 22 R.F.L. (4th) 170 (Ont. Gen. Div.)), the Court held that a divorce should not be held up or delayed because of a tactical issue raised by one of the parties.
[56] In my view, Jana’s explanation as to why she wants to delay a divorce can best be described as a tactical position. She has certain issues that she is firmly focused on, and does not want to let the litigation go until she has answers to those issues. In my view, it is not necessary to wait for a divorce to address these issues. A divorce will issue thirty-one (31) days after these reasons are released.
Witnesses and Evidence
[57] I received a number of documents as evidence. In addition, I heard testimony from David, Rodney Hendren (an appraiser), Dino Bottero (another appraiser) and Jana. I will address the evidence from the appraisers in the relevant sections on property.
[58] In terms of David’s evidence, I generally found him to be a credible witness, in that he was attempting to tell me the truth as he remembered it. However, I did not find David’s evidence to be entirely reliable for three reasons, as follows:
a) It was clear that David did not like conflict, and was not necessarily prepared to be direct in his testimony (or in his dealings with Jana) if it was going to cause a conflict. As an example, he testified that he was free to use the telephone at home, but that he would “choose” not to do so because it might cause a problem.
b) David sometimes found the questions confusing, and provided answers that were inconsistent. In particular, his evidence on the money his parents had loaned him was confusing because he did not understand the questions that were being put to him at first, even though Ms. Iacobelli was asking questions in a clear manner.
c) David had difficulties remembering certain events. “I can’t remember” was a regular response from him to questions from both his counsel and from Jana.
[59] I did not find Jana’s evidence to be either credible or reliable. In terms of credibility, one example stood out. At one point in cross-examination after a number of occasions where Jana did not remember something, Jana, Ms. Iacobelli and I had the following exchange:
THE COURT: We’re going to have – you confirmed that you did the scratching out on that and that was part…
A. I don’t know.
THE COURT: That was ….
A. I don’t want to confirm anything.
MS. IACOBELLI: Q. You did confirm it.
A. I don’t want to confirm anything.
Q. You’re under oath and you’re an honest woman. So you can’t ….
A. I, I, I cannot remember. Here we go.
Q. This is – please don’t…
A. I cannot remember.
Q. …please don’t…
A. I, I, I….
THE COURT: I’m going to have that marked as an exhibit.
A. Oh, that’s not right. I cannot – he said yesterday, everything I said, he said that I don’t remember. Now, I’m using the same thing. I cannot remember.
THE COURT: I have, I have noted that you, in response to this question, that you decided that you’re going to “use the same tactic as your husband”.
A. Yeah, but he was…
THE COURT: I’ve made that note.
A. …trained by her, you know, and I’m not trained. I, I’m not – I’m, I’m just – I’m an honest person. I don’t know if those number’s right. I have no access ….
[60] In terms of reliability, Jana regularly had difficulties in answering questions with a responsive answer. Instead, she tended to talk about the issues that she thought were important, even when she had been told that those issues were not being considered by the Court.
[61] As a result, in resolving the issues in this case, I have generally focused on the documents that the parties have tendered as evidence as being the most reliable evidence. Where I have accepted the evidence of one of the parties on a particular point, I have explained my reasons for doing so.
[62] There is one other issue with respect to witnesses that should be addressed. Jana sought to call Ms. Iacobelli, David’s counsel, as a witness. The reason that Jana wanted to obtain testimony from Ms. Iacobelli was to deal with issues relating to the propriety of documents that were filed with the Court, as well as the procedural issues as to how certain documents had come to be filed with the Court.
[63] I ruled orally that this evidence would not be permitted, and will now briefly set out my reasons for this ruling.
[64] As I noted in my oral reasons, it is very unusual for one side to be permitted to call the opposing side’s solicitor. Indeed, as our Court of Appeal noted in Leonard v. Leonard ([1999] O.J. No. 2181), one side can only call the other side’s counsel in the rarest of circumstances, and only where there is a basis for counsel’s testimony beyond the mere fact that counsel may have helpful evidence.
[65] There is no basis to assume that Ms. Iacobelli would have had helpful or necessary evidence in this case that was beyond the evidence that David could provide and, as a result, I did not permit Jana to call her as a witness.
[66] Having dealt with all of these preliminary matters, this brings me to the issues that have to be decided in this case.
Issue #1- Equalization
[67] Jana argues that David is hiding assets and has not provided full financial disclosure. In particular, Jana seeks additional disclosure of business records, and argues that the details of the farm transaction have not been properly accounted for.
[68] In addition, the parties have each provided NFP Statements. These statements, and the arguments that were made, disclose several issues that must be addressed:
a) Is David hiding money from Jana?
b) What deduction, if any, should David be entitled to because of the fact that he owned one-third of the dairy farm prior to marriage?
c) What value should be placed on the Matrimonial home?
d) What should be done with David’s claim that his parents had loaned him money, and that this loan was outstanding at the time of the separation?
e) What should be done with the Promissory Note that Jana signed?
f) Does Jana own the accounts listed on her NFP statement as hers?
g) What should be done with the deductions for disposition costs being claimed by David?
h) Are the chattels valued correctly?
[69] Once these questions are answered, the remainder of the issues with respect to equalization and NFP will flow.
a) Is David Hiding Additional Money?
[70] Jana argues that David is hiding money from her. In support of this argument, she points to the following issues:
a) The existence of a number of Agreements of Purchase and Sale (“APS”) for the dairy farm. She stated that she did not know if the property had actually been sold twice, but that there was a clear plan to hide money.
b) The existence of a trust ledger from Prouse Dash and Crouch that showed considerable amounts of money moving in and out of the account.
c) The fact that the milk quota was sold for $1,700,000.00.
[71] I will deal with each of these issues in turn.
The Sale of the Dairy Farm
[72] In the course of her evidence, Jana sought to rely on a whole series of documents relating to attempts to sell the farm. I was originally not prepared to receive these documents in evidence, as they were not properly disclosed. However, after Jana made considerable reference to them in her evidence, I determined that it would be appropriate for the Court to receive them as evidence. No objection was raised by David’s counsel.
[73] These documents do reveal that there were a number of proposed transactions for the sale of the property, as follows:
a) An agreement of purchase and sale for a portion of the property, in the sum of $115,000.00 per acre, dated March 17th, 2005.
b) An agreement of purchase and sale dated August 25th, 2005, for the sum of $22,270,000.00. The draft of the agreement I have indicates that the parties negotiated over the sale price.
c) The final agreement, dated August 24th, 2006, which was for nineteen million dollars, and included a Vendor Take-Back (“VTB”) mortgage of $9,500,000.00. This mortgage was for a five year term, and included interest at 4.0% per year after the first year.
[74] There was some additional paperwork associated with these agreements, and I have reviewed all of that paperwork. In my view, it is clear that the original two sale agreements did not proceed. The reason that the agreements were not completed was that there were problems with a pit on the property, and with sediment flowing into the Humber River system from that pit.
[75] These issues were described in a July 19th, 2016 letter from Mr. Richard Prouse, the lawyer who acted on the transaction, as follows:
The reduction in sale price and modified closing dates were a result of the deficiencies on the property such as a pending law suit by the neighboring owner, and costly environmental repairs which had to be addressed by trained and professional engineers. Trow Engineering and Blue Star Construction were retained to complete the remedial work for the put runoff, affecting the river and neighboring property.
[76] When these documents are reviewed, it is clear as to what happened with the sale of the farm. Ultimately, the parties decided to sell all of the property. However, the closing date had to be changed and the price reduced in order to deal with environmental problems on the property. The sale of the dairy farm does not demonstrate any attempts to hide assets.
[77] More generally, in relation to the sale of the dairy farm, Jana regularly raised issues of disclosure, claims of improper information from the land registry office and assertions that when she reported things to the police, they were unhelpful to her. I see no basis to conclude that there was any missing information, or any inaccurate records in the materials before me.
[78] Again, I confirm that the sale of the dairy farm did not demonstrate any attempts to hide assets on David’s part.
The Ledger from Prouse, Dash and Crouch
[79] Jana points to a ledger from Prouse Dash and Crouch (Exhibit 32) to show that David and his parents are hiding money. In particular, she points to the fact that the ledger shows deposits and withdrawals of $36 million.
[80] An inspection of the ledger, however, shows that money was being withdrawn and deposited into this trust account on a regular basis. The same money appears several times on the ledger. As a result, this ledger does not support the conclusion that there was any money beyond the $19 million for the sale of the dairy farm.
The Sale of the Milk Quota
[81] Jana sought to lead evidence showing that the sale of the milk quota netted the Wardlaws $1.7 million. I did not permit her to lead the actual cheques, as I understood that the documentation had not been provided to Ms. Iacobelli. However, I accept that the Wardlaws received this money for the sale of their milk quota. Jana also testified that the milk quota was solely in David’s name.
[82] The fact that they all received this money for the sale of the milk quota does not prove that David is hiding money. The fact that his parents were given 2/3 of this money, as Jana alleges, also does not prove that they were hiding money. The mere fact that the milk quota was in David’s name alone does not prove that it was owned solely by him. Indeed, given that the family was running the dairy farm together, it is not unreasonable to infer that the milk quota was owned by all of them, and that David held a portion of it in trust for his parents. I see nothing improper in this transaction. I would also note that this transaction happened ten years before separation.
Conclusions on Whether David is Hiding Money
[83] None of the farm sale, the ledger from Prouse Dash and Crouch, or the sale of the milk quota raise any issues that David may be hiding money. There is simply no evidence in any of these transactions that David has diverted wealth from his main accounts or has other undisclosed sources of wealth.
[84] On this point, I should note three other issues that Jana raised, as follows:
a) Jana testified that she and David went to Panama and they bought properties that were in David’s name. David denied this claim, and I accept his evidence. There was not a shred of documentation to support Jana’s assertion, and there was no mention of any income on properties in Panama in David’s tax returns.
b) Jana testified that David sometimes used Shaw (his middle name) as his first name in transactions. Even if this is true, there is no connection between the use of David’s middle name and a plan to hide assets.
c) Jana also suggested to David in cross-examination that the dairy farm on McGillivray Road sometimes had a Vaughan address and sometimes had a Kleinburg address. The street number on McGillivray Road was the same, regardless of which municipality name was used. It was not clear to me how this demonstrated any ability to hide money. The property has not changed its location.
[85] I also note that the evidence I do have supports an inference that David is not hiding money. In particular, as I have noted at paragraph 41 above, David’s 2007 tax return shows that he had considerable income from farming operations that year. This income stream would have disappeared long before the parties separated.
[86] In addition, there is the fact that David’s assets are approximately $4 million. He would have received approximately $6.5 million from the sale of the farm and the milk quota. He provided approximately $1 million to Jana. As I will discuss below, the parties also spent a considerable amount of money to renovate the new matrimonial home, and they have also taken trips. The evidence was also clear that David paid for the expenses out of his money, and that Jana has not touched the money that David gave her. As a result, there is no reasonable basis to infer that there was any missing money in this case.
[87] To accept Jana’s submissions that David has hidden accounts would also require me to believe that an investment advisor at RBC and a law firm were engaged in supporting this fraud. It would also require me to conclude that David had lied on his tax returns, even before separation. These assertions are unsupported by any evidence and I reject them.
[88] The investments and other assets that David has disclosed are the entirety of his assets.
b) Deduction for the Dairy Farm
[89] David’s NFP indicates that he is seeking a deduction from his NFP in the sum of $2,700,000.00 as a result of his 1/3 interest in the dairy farm, which he owned prior to marriage. This amount is based on a valuation of the farm performed by Dino Bottero.
[90] Mr. Bottero was qualified as an expert accredited land appraiser. He provided a detailed report, and reviewed that report on the witness stand. His evidence was helpful both in establishing the value of the property as of the date of marriage, and in explaining the transactions that took place after the date of marriage. In particular, he confirmed that a review of the land registry system and other databases
[91] Jana states that this report undervalues the property as at the time of marriage. She argues that the value of the dairy farm should be higher. I attempted to explain to Jana that proving that the property was worth more as of the date of marriage would not assist her.
[92] I reject Jana’s assertion that the property was worth more than the $8,100,000.00 that Mr. Bottero estimated it was worth on July 20th, 2000 for two reasons. First, I found Mr. Bottero’s evidence in terms of how he calculated the value of the farm to be logical, complete and compelling. Second, this evidence was not seriously challenged by Jana on cross-examination, and was not contradicted by any of the evidence that she led in the course of her case.
[93] As a result, David will be entitled to a deduction for the value of the dairy farm as of the date of marriage of $2.7 million.
c) Issues Relating to the Matrimonial Home
[94] Again, the value of the matrimonial home on the date of separation was contested. The value was provided by Rodney Hendren an appraiser who was also qualified as an expert, and had reviewed the property. He confirmed that the house was purchased in May of 2008 for the sum of $985,000.00. The house, when it was purchased, was an 1,100 square foot bungalow on a lot that was just under 100 acres. He testified that the value of the property was $1,700,000.00 as of February of 2018. David does not claim any reduction in this value to reflect the fact that the appraisal was seven months after separation.
[95] As part of considering the value of the matrimonial home, Jana argued that she should be entitled to a constructive trust remedy with respect to the home. Jana testified that David had not put her on title because he was concerned that, if she died first, her mother in Germany might be able to claim an inheritance under German law. I heard no evidence about the law in Germany that would support this conclusion.
[96] David, on the other hand, testified that he didn’t put Jana on title because she hadn’t contributed to the house. Given that the house was purchased with proceeds from David’s share in the dairy farm, this is a more logical statement of what happened, and I accept it.
[97] The leading case on that remedy is Kerr v. Baranow (2011 SCC 10, [2011] 1 S.C.R. 269). In addition, the Ontario Court of Appeal has discussed the constructive trust remedy in Martin v. Sansome (2014 ONCA 14, 118 O.R. (3d) 522). That decision considered the application of the constructive trust remedies to married couples. At paragraph 48, Hoy A.C.J.O. stated:
- The Supreme Court reiterated existing principles of unjust enrichment in Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269 (S.C.C), in the context of a dispute between unmarried persons in domestic relationships. Kerr reaffirmed that where unjust enrichment is established, the first remedy to consider is always a monetary award. A court will impress a proprietary remedy – normally a constructive trust on property – only if the plaintiff satisfied it that monetary award would be insufficient in the circumstances and that there is a sufficiently substantial and direct link between his or her contributions and the acquisition, preservation, maintenance or improvement of the disputed property.
[98] In this particular case, I am satisfied that a trust remedy is not appropriate for three reasons. First, the entirety of the increase in the value of the property between the date of marriage and the date of separation is captured in David’s NFP statement, and will be equalized.
[99] Second, the improvements that Jana testified she either did or supervised did not add any value to the house. Those improvements included the addition of sunrooms, a geo-thermal heating system, a new garage, new interior finishing (including oak doors) and updated plumbing. Jana testified that she cut the tiles and laid them herself. Mr. Hendren estimated that the cost of these improvements would have been approximately $360,000.00. In addition, Mr. Hendren testified that the investment in geo-thermal heating would take a long time to pay off.
[100] Jana also spent considerable time at trial pointing out that their house was a “leader” in green energy, and that the improvements had been of a high quality. While that may be correct, it does not answer the question of whether these improvements enhanced the value of the matrimonial home.
[101] Mr. Hendren’s testimony, which I accept, was that the more logical approach to this property would have been to bulldoze the existing structure and build a new, custom-built structure.
[102] As a result, any of the improvements that were made to the house did not substantially enhance its value. This is another factor that supports the conclusion that a trust remedy is not appropriate in this case. Jana has not enriched David through her work on the house.
[103] Third, there is the question of the cost of the renovations and the time spent on them. While Jana may have done considerable work on these renovations, substantially all of the money to pay for them came from David’s accounts. This suggests that the distribution of responsibilities was more equal, and that the increase in the value of the house will be fully captured on the NFP statement without a trust remedy.
[104] In addition, there is Jana’s relationship with contractors. It was clear from her evidence that Jana had a low regard for Canadian contractors. It was also clear from the evidence that Jana had driven a number of the contractors away with her aggressive and confrontational approach to the renovation projects. Jana also accused (without any substantiation that I heard) at least one contractor of assaulting her.
[105] Finally, Jana raised a claim that there might have been irregularities in the purchase of the Heart Lake Road house. In particular, Jana notes that there were some differences on some of the documents in terms of the dates for closing. Given that there is no dispute that David has title to the Heart Lake Road home, I fail to see how any irregularities (even if they exist) are relevant to the issues I have to determine.
[106] For the foregoing reasons, there is no basis to conclude that Jana should be entitled to a trust remedy in this case.
d) The Loan From David’s Parents
[107] On David’s NFP, it lists a loan from his parents in the sum of $58,544.95. The question is whether David is entitled to a deduction for this loan as of the date of separation.
[108] In the course of the hearing, I provided the parties with the decisions in Barber v. Magee (2015 ONSC 8054, aff’d 2017 ONCA 558). In the trial decision, D. Fitzpatrick J. sets out a list of criteria (at paragraph 42) that the Court should consider in assessing whether a transaction is a gift or a loan. That list reads as follows:
a. Whether there were any contemporaneous documents evidencing a loan;
b. Whether the manner for repayment is specified;
c. Whether there is security held for the loan;
d. Whether there are advances to one child and not others or advances on equal amounts to various children;
e. Where there has been any demand for payment before the separation of the parties;
f. Whether there has been any partial repayment; and,
g. Whether there was an expectation or likelihood of repayment.
[109] I have concluded that this money was a loan, and that it has been substantiated as such, for the following reasons:
a) There is documentation to establish each of the amounts that was paid by Fern and George on behalf of David. They are all clearly David’s expenses, and are all paid at the RBC branch in Nobleton, which is where David testified that his mother banked. David did not bank in Nobleton.
b) There is a reasonable explanation as to why these amounts were being paid. David was due a tax refund of $74,400.65, and his parents paid these bills on his behalf so that he did not have to cash in his investments.
c) Each of the payments was for a specific bill, rather than it being a gift of money that David then used to either pay a bill or to cover some other expense.
d) The existence of a pending tax refund also satisfies the criteria of the manner of repayment, as well as when the repayment would have taken place.
e) There is no reason for David’s parents to have paid any expenses on his behalf. He has assets in excess of $4 million.
[110] As a result, I am of the view that the $58,544.95 was a loan rather than a gift and should be included on David’s NFP as such.
e) The Promissory Note From Jana
[111] Jana argues that this promissory note was not enforceable because it was not properly signed. In my view, it is not necessary to resolve that issue. David is not seeking to enforce the promissory note from Jana, now or ever.
[112] David’s concession makes sense as, if the note was enforced, it would appear on Jana’s NFP statement as a liability and David’s NFP statement as an asset. Its existence would entitle Jana to additional monies from David to compensate for the note, but she would be obligated to pay off the note. Since the note appears on both financial statements, the additional money would be exactly the value of the note.
[113] The enforcement (or non-enforcement) of the note has no effect on the ultimate disposition of this case. However, to ensure finality, an Order will issue confirming that the resolution of this action extinguishes Jana’s obligations (if any) under this note.
f) Does Jana Own the Assets on the RBC Dominion Statements in her name?
[114] Yes.
[115] On a number of occasions in the trial, Jana stated either that she did not want to access this money or she couldn’t access this money. I have already set out the reasons why I reject the evidence that she could not access this money at paragraphs 29 to 32, above.
[116] In terms of the RBC statements generally, I should note that each party has a US Dollar account. I have converted the value of those accounts into Canadian dollars as of the date of separation based on the exchange rate as of the date of separation. Information on this exchange rate was included in Exhibit 16.
g) What Should be Done With Disposition Costs?
[117] David seeks to have a deduction for the following disposition costs included in the NFP calculation:
a) Real estate commission on the sale of the matrimonial home in the sum of $85,000.00.
b) Legal costs for the closing of the matrimonial home in the sum of $1,500.00
c) Disposition costs for his, and Jana’s, RRSP’s of 33%.
d) Capital Gains regarding investments in the sum of $11,000.00.
[118] I have determined that none of these costs should be included in the NFP calculation.
[119] My analysis starts with the Court of Appeal’s decision in Sengmueller v. Sengmueller ((1994) 1994 CanLII 8711 (ON CA), 17 O.R. (3d) 208 (C.A.)), where McKinlay J.A. stated (at para 18- emphasis added):
In my view, it is equally appropriate to take such costs into account in determining net family property under the Family Law Act if there is satisfactory evidence of a likely disposition date and if it is clear that such costs will be inevitable when the owner disposes of the assets or is deemed to have disposed of them. In my view, for the purposes of determining net family property, any asset is worth (in money terms) only the amount which can be obtained on its realization, regardless of whether the accounting is done as a reduction in the value of the asset, or as a deduction of a liability: the result is the same. While these costs are not liabilities in the balance-sheet sense of the word, they are amounts which the owner will be obliged to satisfy at the time of disposition, and hence, are ultimate liabilities inextricably attached to the assets themselves. This is consistent with McPherson but goes beyond it.
[120] For David to be able to claim these costs, there has to be satisfactory evidence of a likely disposition date, and the costs have to be inevitable. Starting with the real estate commission, I had no evidence that David intended to sell the matrimonial home. Indeed, as will be discussed below, he will have exclusive possession of it, as he is the sole owner of the property.
[121] Similarly, the taxes associated with the RRSP are also a contingent matter that cannot readily be estimated at this time. In any event, both parties are likely to have similar disposition costs for their RRSP’s, at least as estimated by David on his NFP statement.
[122] Finally, there is the claim for capital gains. I have no indication as to what will trigger this gain, when it will be triggered, or how the amount was calculated. Again, the criteria required by Sengmueller, supra are not met.
[123] None of these deductions will be included on the NFP statement.
h) Other Chattels
[124] There was a list of other chattels that each party was claiming a value for. In that respect, I would make the following observations:
a) There was no evidence about some of the items, such as the antique clocks, the Apple computer and the tile saw. As a result, I have simply accepted the numbers on the NFP.
b) There are some items, specifically the Sauna and the toilets, that Jana has claimed as her property. These appear to be fixtures in the house, title to which is in David’s name. As a result, these items will not be included on Jana’s NFP.
c) There were some vehicles and the like that were included on the NFP. While there was some dispute about the value of these vehicles, I did not have any supporting documentation for either claims, and the value of these items is not significant. As a result, and as a result of my concerns about Jana’s credibility and reliability, I accepted the estimates on David’s NFP.
[125] Adjustments for these items have been made on the NFP statement.
[126] I note that all other household contents are to be divided. Given the contentious nature of this proceeding, I remain seized to deal with any issues over the division of the household contents.
i) Conclusion on Equalization
[127] I have set out my conclusions on equalization in the attached Appendix “A”. Based on those conclusions, I have determined that an equalization payment is owing from David to Jana in the sum of $18,968.36.
[128] That equalization payment is to be made within thirty (30) days of the issuance of these reasons. If the parties have any arithmetical disputes with my calculations, they may provide me with written submissions of no more than two (2) double-spaced pages within seven (7) days of the release of these reasons.
[129] For clarity, these submissions are not an opportunity for either party to re-litigate the issues. Instead, they are to address questions of whether I made an addition or subtraction error.
Issue #2- Spousal Support
[130] There are two issues that need to be addressed. First, whether Jana is entitled to spousal support. Second, if she is entitled to spousal support, what the quantum of that support should be. Jana claims spousal support in the amount of $6,000.00 per month. David argues that there should not be any entitlement to spousal support in this case.
a) Entitlement
[131] Jana asserts that she should be entitled to spousal support on both the compensatory basis and on the needs basis. I will address each in turn.
Compensatory Basis
[132] The rationale behind the compensatory basis for spousal support was set out in Moge v. Moge (1992 CanLII 25 (SCC), [1992] 3 S.C.R. 813 at 861) where the Court stated:
Today, though more and more women are working outside the home, such employment continues to play a secondary role and sacrifices continue to be made for the sake of domestic considerations. These sacrifices often impair the ability of the partner who makes them (usually the wife) to maximize her earning potential because she may tend to forego educational and career advancement opportunities. These same sacrifices may also enhance the earning potential of the other spouse (usually the husband) who, because his wife is tending to such matters, is free to pursue economic goals.
[133] In this case, the evidence of Jana’s contributions to the net family venture are limited. I reject Jana’s evidence that she made a significant contribution to the running of the dairy farm for the following reasons:
a) Jana did not describe in any detail what work she actually did.
b) The dairy farm was sold by 2007, and there was no indication that any of the parties engaged in any farming activities thereafter.
c) Jana was working outside of the home until 2008.
d) In the first couple of years of marriage, Jana was waiting for confirmation that she was able to work in Canada.
[134] Similarly, Jana argues that she was required to take care of David when he was sick. She also testified that David used a walker for a period of a year or two. I am not prepared to put significant emphasis on Jana’s testimony for a number of reasons:
a) There was no medical documentation whatsoever to support the extent of David’s medical conditions. I acknowledge that there were some prescription records, but that is all I had.
b) David stated in his evidence that he was referred to at least one specialist in part to placate Jana, rather than because it was necessary.
c) The time when David was allegedly sick absorbed less than two (2) years in the time period from 2007 to 2017.
[135] There is also Jana’s claim that she needed additional medical documentation to establish David’s medical condition in the relevant time period. I also reject this claim for two reasons. First, if Jana had wished to obtain more medical documentation, she could have brought a motion for production before the case management judge. Second, in assessing the entirety of the parties’ marriage, additional evidence on a period of a year or two when David was admittedly having medical issues is of marginal utility.
[136] Finally, there is the house renovation when the parties moved to Heart Lake Road. I have already detailed (at paragraphs 102 to 104, above) my concerns about this renovation. I would also note that this was not the sort of project that would justify giving up full-time employment to manage. It is a simple house renovation.
[137] As a result, I do not accept that Jana is entitled to spousal support on the compensatory basis.
Needs Basis
[138] In Gray v. Gray (2014 ONCA 659), the Court of Appeal provides guidance as to how the needs basis must be considered:
One of the objectives of the Divorce Act is to relieve economic hardship. Need is not measured solely to ensure a subsistence existence, but rather should be assessed through the lens of viewing marriage as an economic partnership. As stated by this court in Marinangeli v. Marinangeli (2003), 2003 CanLII 27673 (ON CA), 66 O.R. (3d) 40 (Ont. C.A.) at para. 74, in determining need, courts ought to be guided in part by the principle that the spouse receiving support is entitled to maintain the standard of living to which she was accustomed at the time cohabitation ceased. The analysis must consider the recipient’s ability to support herself, in light of her income and reasonable expenses.
[139] In this case, there are two factors that must be considered. First, there is the fact that David will have considerably more in assets than Jana after the divorce is complete. His assets are worth approximately four times what Jana’s assets are worth. This suggests that Jana is entitled to support on the needs basis.
[140] Against that factor, I must weigh the fact that Jana has skills (as discussed below), and that she is capable of earning an income. In my view, this factor is not sufficient to counterbalance the difference in asset bases as Jana has been out of the workforce completely for a period of ten (10) years. Given this fact, Jana is entitled to some spousal support in this case.
[141] I should also note that Ms. Iacobelli argued that the Wardlaws are all very frugal, and that there was no need for an award of spousal support. There are two problems with this argument. First, there was no evidence before me to support (or refute) this assertion. Second, this claim about frugality must be matched against the fact that there have been some very expensive house renovations that have been undertaken by the parties prior to separation.
[142] In the result, Jana has an entitlement to spousal support on the needs basis.
b) Quantum
[143] First, I need to establish the income for the parties for the purposes of calculating support. That requires a consideration of how much money each party’s investments are likely to earn on an annual basis. It then requires a consideration of whether each party is going to be able to work and, if so, at what income.
The Investments
[144] The parties each have a line 150 income, as well as deductions from that income. The deductions from the line 150 income are significant in both cases. I heard no explanation from either party as to what the significance of those deductions is. Both of them have claimed similar types of deductions.
[145] I am of the view that the Line 150 income should be used for determining each party’s income (to start) for the following reasons:
a) The presumptive approach is to use the parties line 150 income for calculating child (and spousal) support.
b) There is no evidentiary basis on which I can assess the basis for the various deductions from the parties income.
[146] The documentation filed at trial discloses the following about the parties’ Line 150 Income:
Line 150 Income
| Year | Jana | David |
|---|---|---|
| 2017 | $59,821.00 | $120, 255.00 |
| 2016 | $55,580.04 | $123,116.45 |
| 2015 | $105,180.03 | $286,414.34 |
| 2014 | $47,370.55 | $141.515.50 |
[147] As will be noted, both parties had a much higher income in 2015 than in the other three years. On reviewing the tax returns, it appears that each party had a one-time capital gain that they received in these years. As a result, I do not view 2015 as being a typical year for income purposes for either party.
[148] In addition, I note that David’s income is slowly falling, while Jana’s is slowly rising over time. Part of the reason for that is that David has been using his income to pay the household expenses for both parties, while Jana’s income has been reinvested in more investments because she has refused to touch her accounts at RBC Dominion Securities.
[149] Given these two facts, I am of the view that the Line 150 Income for each party should be used for the calculation of spousal support. It is only, however, a starting point. I must now consider whether income should be imputed to either party, given that neither of them are employed.
The Ability to Work
[150] On this point, I start with David. He is 57 years old, does not have a high school education and had been retired for more than ten years as of the date of separation. Even after equalization, he also has enough investments to earn him a six figure income for the rest of his life. There is no reasonable basis to infer that David will ever go back to work.
[151] Further, there is no basis to infer that David should be obliged to go back to work to increase his income to support Jana. I reach these conclusions for three reasons:
a) David’s age- he is almost 58 years old, which is an age when people think about retirement.
b) David’s level of education. He has not finished high school. Returning to any sort of gainful employment would probably require some upgrading courses.
c) Given that David worked on his parents’ dairy farm all his life, it is not unreasonable for him to have decided to take his share of the profits from the sale of the property and retire.
[152] This brings me to Jana. The circumstances with her are different. In assessing whether income, over and above the amount earned from her investments, should be imputed to Jana, I must consider a number of factors as follows:
a) Jana’s education level
b) What work Jana has performed previously in Canada.
c) Jana’s reasons for not working outside the home after 2008
[153] I start with Jana’s education level. In addition to having finished high school, she testified that she had completed some university level education to become a teacher in East Germany, but did not qualify as a teacher because she disagreed with the system.
[154] She also testified that, after the fall of the Berlin Wall, she went to a co-op program to become a licensed optician. This was a three-year program, and Jana completed this program in two and a half years. Jana offered to provide her certificates to show her various qualifications. I decided that this was not necessary, as Ms. Iacobelli was prepared to accept Jana’s testimony on this point, as am I.
[155] In terms of her work history in Canada, Jana testified that she worked for a company called Woodlore International for three years from April of 2005 to May of 2008. She also testified that she worked at the German Club in Brampton as a server, and had smart serve training. She testified that David asked her to stop working because it was requiring him to pay additional income tax. However, later in her evidence in chief, Jana suggested that she had stopped working because she had been laid off.
[156] I have already set out my concerns (at paragraphs 132 to 137, above) about Jana’s explanations for not working outside of the home between 2008 and the date of separation.
[157] In addition, in cross-examination, Jana acknowledged that she did not make any applications for a job in the time between when the parties separated and trial. She provided a detailed explanation as to why she has not applied for a job:
Q. Did – do you have any medical evidence that you’re unable to work?
A. What do you mean medical evidence?
Q. Have you provided any….
A. I don’t want to work right now, because I want to fight you people. You don’t understand. Now you’re laughing.
Q. I’m not, I’m not laughing.
A. I’m not – like I’m, I’m –I take care….
Q. There’s nothing to laugh about.
A. I, I take care about my husband. I stand up in the -- I get up in the morning. I took care and make sure he have breakfast. We have breakfast together. He goes to his parents and then he comes home and we have supper together, I prepare every day and, and I take care about the house. And meanwhile, meanwhile I be, a be a – try to be self-represented at the, at the courthouse. Every week I go to the filing office and spend the whole day there. I do everything. I do – because I want to be prepared.
Q. Ms. Wardlaw, if….
A. And when it is over, when, when everything is -- when it does after the right way, when – like we wouldn’t be here if you would not fill out the registration with – under Shaw Wardlaw. We wouldn’t be here if you wouldn’t fill out multiple applications, we wouldn’t be here when you have two clearance certificates. We wouldn’t be here….
[158] In my view, this explanation demonstrates that Jana has made this trial her life’s work for the past year and a half, and that she had no intention of looking for a job after separation.
[159] In my view, then, she is underemployed and I should impute income to her. The question becomes how much income should be imputed to her.
[160] I start with the fact that, under the Ontario Employment Standards Act 2000 S.O. 2000 c. 41, section 23.1 sets out the minimum wage as $14.00 per hour. Over a 40-hour week, this produces an annual income of $29,120.00. In my view, this is the minimum income that I should impute to Jana.
[161] However, Jana’s income earning potential must also take into account the fact that she has skills as an optician, a server and a factory worker. This suggests an amount that is higher than the minimum wage.
[162] I must balance Jana’s skills with the fact that she has been out of the workplace for a period of ten (10) years. As a result, I am of the view that imputing income to Jana in the sum of $35,000.00 per year is appropriate.
The SSAG Calculations
[163] Based on these numbers, I ran SSAG calculations for the quantum of spousal support that would be payable by David to Jana.
[164] I have based the calculation of spousal support on the parties’ 2017 incomes. As I have noted at paragraph 148, David’s income has been slowly falling, while Jana’s has been slowly rising over the past few years. As a result, their 2017 income is a reasonable estimate of what they will earn, now that Jana has to take responsibility for her own expenses. In addition, I have imputed $35,000.00 to Jana for the income she should be making. That imputation starts January 1st, 2020, which gives Jana almost three months to find a job.
[165] This produces a support range of $540.00 to $721.00. I note that, in Mason v. Mason (2016 ONCA 725 at para. 52), the Court of Appeal cited with approval the passage in the SSAG’s that suggests that if the recipient receives a large amount of property, the low end of the range may be more appropriate.
[166] In this case, Jana will have received (over the course of the marriage) property that generates an income of nearly $60,000.00 per year. As a result, I am of the view that the low end of the range is appropriate for the support payments in this case.
[167] I also note that Jana does not have to leave the matrimonial home until December 7th, 2019, and that she has not (as far as the evidence shows) had to pay any expenses in the time that she has lived in the home. Therefore, there is no entitlement to retroactive spousal support, and the first payment does not have to be made until January 1st, 2020.
[168] As a final matter, this has been a high conflict case. As a result, I have determined that I would like to hear submissions from the parties about whether the monthly spousal support payments should be converted to a lump sum. Those submissions shall be heard on November 19th, 2019 at 9:00 a.m. for one hour. The parties are welcome to agree on an alternate date, and may file casebooks in advance. The parties are also welcome to discuss this issue through counsel and see if they can reach a resolution.
Issue #3- Possession of the Matrimonial Home
[169] Each party seeks exclusive possession of the matrimonial home. However, I have rejected Jana’s claim for a trust interest in the matrimonial home. As a result, the title to the matrimonial home remains in David’s name.
[170] Section 19 of the Family Law Act states:
- POSSESSION OF MATRIMONIAL HOME – (1) Both spouses have equal right to possession of a matrimonial home.
(2) IDEM – when only one of the spouses has an interest in a matrimonial home, the other spouse’s right of possession,
(a) is personal as against the first spouse; and
(b) ends when they cease to be spouses, unless a separation agreement or court order provides otherwise.
[171] The granting of the divorce, combined with this provision and the fact that David has sole title to the matrimonial home means that he is entitled to sole possession of the matrimonial home. See Lorenzen v. Desjardins (2017 ONSC 1932 at paras 199 to 205).
[172] However, I acknowledge that the parties have been living in the matrimonial home continuously since the separation. As a result, it is appropriate to provide Jana with a period in which she can find new accommodations, either to rent or to purchase.
[173] As a result, Jana is required to vacate the matrimonial home sixty (60) days from the date that these reasons are released.
Issue #4- Non-Harassment Orders
[174] Each party seeks a non-harassment order. I start with Jana’s request for this relief. Given the evidence that I heard at trial, there is no basis for Jana’s request for a non-harassment Order. I heard of no conduct that David (or his parents) have engaged in that would justify a non-harassment Order being made against them. The evidence was clear that David did not wish for Jana to be part of his life anymore.
[175] Given this evidence, it is clear that no harassment order is necessary for David. I anticipate that David will not initiate any contact with Jana once this proceeding is over and she has moved out.
[176] This brings me to David’s request for a non-harassment Order. The evidence on this issue was inconsistent. At some points in his testimony, David suggested that he was not afraid of Jana. On other occasions, he qualified that he was not afraid of her if she behaved herself and was not aggressive.
[177] David also described life with Jana in the following terms:
a) Friends do not come to visit because Jana alienates them.
b) He found it difficult to live with Jana because she yells all the time.
c) He found it difficult to live with Jana because she gets into disputes over even minor service related issues.
[178] In my view, these concerns are not enough to justify a non-harassment Order, especially given the inconsistencies in David’s evidence on this point.
[179] However, it was also clear that Jana might not comply with the Court’s Orders. Indeed, the very last exchange she had with Ms. Iacobelli was as follows:
Q. Okay, just -- nobody knows what’s going to happen at the end of this trial. But we’re, we’re, we’re, we’re -- we know Mr. Justice Lemay is going to do the very best he can for all of us. But if you were ordered -- at the end of this trial, by order of our trial judge, if you were ordered to leave the Heart Lake Road property, would you do so voluntarily?
A: I’d have to think about it. That’s my answer.
[180] In light of this answer, I am of the view that some additional Orders will be necessary to ensure that the Orders I have made are carried out. Specifically, the Caledon Police are directed to assist in the removal of Jana from the matrimonial home on December 7th, 2019 if she has not left the property at that point.
Issue #5- Costs Already Paid
[181] There are two costs issues. First, whether costs of this litigation should be paid by one side or the other. Second, whether Jana should reimburse David for three different sets of legal costs in this case.
[182] In terms of the costs of the litigation, I had Ms. Iacobelli file her bill of costs at the conclusion of final argument. However, I have not made any decision regarding costs as I now need to see whether either party has made an offer to settle that might affect the outcome of my costs decision. I have set out a process for addressing the costs issue in the next section.
[183] Then, there are three discrete legal costs that David is seeking reimbursement of, as follows:
a) A total of $6,000.00 for Jana to obtain evidence from Ms. Martha McCarthy, a family law lawyer in Toronto. These amounts were paid on Jana’s behalf by David.
b) $500.00 in costs that was awarded to David on November 27th, 2017. This amount was paid to Prouse Dash and Crouch through the parties joint visa card, which David then paid off. In other words, David paid the costs that the Court had awarded against Jana.
c) $1,500.00 in costs awarded by Bielby J., payable at the conclusion of the trial, on September 11th, 2018. These costs were awarded as a result of Jana bringing, and losing, a motion about the clearance certificate.
[184] I am of the view that these costs should all be paid by Jana. They are expenses for pursuing this litigation that are properly paid by Jana. She will have sixty (60) days from the date that these reasons are released to pay these costs orders.
Conclusion
[185] For the foregoing reasons, I order as follows:
a) The parties are to be divorced thirty-one (31) days after the date that these reasons are released.
b) There is no basis to investigate the sale of the dairy farm previously owned by David and his parents.
c) There are no other procedural issues that are required to be addressed before a final decision in this matter can be given.
d) Any obligations that Jana had under the promissory note dated July 3rd, 2012 are extinguished effective immediately.
e) The investment accounts bearing Jana’s name are her property, and control of those accounts rests solely with Jana. In the event that there are difficulties in identifying those accounts, or in obtaining control over them, I retain jurisdiction to address those issues.
f) An equalization payment of $18,968.36 is payable from David to Jana within thirty (30) days of the release of these reasons.
g) If there are any arithmetical disputes in this matter, either party has seven (7) calendar days from today’s date to provide written submissions of no more than two (2) double-spaced pages.
h) The contents of the house are to be divided between the parties. I retain jurisdiction to address any issues relating to the division of household chattels.
i) Subject to the next two paragraphs, David is to commence paying spousal support in the sum of $540.00 per month on January 1st, 2020. This is an interim order pending the appearance described in the next paragraph.
j) The parties are to appear before me on November 19th, 2019 at 9:00 a.m. for a one hour appearance to make submissions on whether I should convert that interim spousal support amount into a lump sum payment.
k) On a final basis, there shall be no retroactive spousal support payable by either party to the other.
l) David is awarded sole possession of the matrimonial home at 19704 Heart Lake Road, and Jana is to vacate the home by no later than December 7th, 2019.
m) The Caledon Police, and such other police forces that are necessary, are to enforce the Order in the previous paragraph.
n) Jana is to pay to David the sum of $8,000.00 inclusive of HST on account of various legal costs that have accumulated in this proceeding. For clarity, this amount does not include any costs award flowing from the trial as I have reserved on that issue.
[186] At this point, I have the bill of costs from David’s counsel. The parties are required to complete their costs submissions. This will be done in writing in accordance with the following timetable:
a) Each party shall serve and file their written submissions on costs within twenty-one (21) days of the release of these reasons. Those submissions are not to be more than three (3) single-spaced pages, exclusive of case-law and offers to settle.
b) Each party shall have an additional fourteen (14) days to provide reply submissions. Those submissions are not to be more than one (1) single-spaced page, exclusive of case law.
[187] Finally, the Orders I have set out in paragraph 184 should be clear, and should easily be converted to a Court Order. In any event, however, Jana’s approval of the Order as to form and content is dispensed with. Ms. Iacobelli is free to take out the Order with the Court office in due course.
LEMAY J
Released: October 8, 2019
Corrected: January 28, 2020
Appendix “A”
Wardlaw v. Wardlaw Net Family Property (“NFP”) Statement
1. Value of Assets Owned on Valuation date
a) Land
| Property | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| 19704 Heart Lake Road | $1,700,000.00 | |
| Total | $1,700,000.00 |
b) General Household Items and Vehicles
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| 2005 Dodge Pickup | $2,000.00 | |
| 2011 Chevrolet Pickup | $5,000.00 | |
| Kubota Lawn Mower | $5,000.00 | |
| Apple Computer | $3,000.00 | |
| Tile Cutting Machine | $200.00 | |
| Antique Clocks | $1,000.00 | |
| Totals | $12,000.00 | $4,200.00 |
c) Bank Accounts, Securities, Savings
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| U.S. Dollar Investment Account | $1,051,166.10 | |
| RBC Dominion Securities- Investment | $1,091,855.68 | |
| RBC Dominion Securities- TFSA | $67,130.60 | |
| RBC Dominion Securities-RRSP | $55,275.96 | |
| RBC Royal Bank Account | $1,453.28 | |
| U.S. Dollar Investment Account | $600,540.76 | |
| RBC Dominion Securities- TFSA | $59,511.51 | |
| RBC Dominion Securities- Investment Account | $606,926.35 | |
| Totals | $2,266,881.62 | $1,266,978.62 |
d) Life and Disability Insurance
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| Sun Life Financial- Whole Life Policy (Cash surrender value) | $13,502.39 | |
| Total | $13,502.39 |
e) Money Owing
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| Tax refund (2016) | $74,400.65 |
2. Value of Debts and Other Liabilities on Valuation Date
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| Personal Loan- G. & F. Wardlaw | $58,544.95 | |
| Credit Card- Joint Visa | $1,334.42 | $1,334.42 |
| Credit Card- RBC | $875.63 | |
| Totals | $59,879.37 | $2,210.05 |
3. Property, Debts and Other Liabilities as of the Date of Marriage
| Item | Value on Applicant’s NFP | Value on Respondent’s NFP |
|---|---|---|
| Dairy Farm- MacGillivray Road | $2,700,000.00 |
4. Calculation
Applicant’s NFP
Value of Property as of Date of Separation- $4,066,784.66
Deductions- Value of debts and other liabilities- $59,879.37
Value of property as of date of marriage- $2,700,000.00
Applicant’s NFP- $1,306,905.29
Respondent’s NFP
Value of Property as of Date of Separation- $1,271,178.62
Deductions- Value of Debts and other liabilities- $2,210.05
Respondent’s NFP- $1,268,968.57
Difference-$37,936.72
Applicant pays Respondent half of difference- $18,968.36
COURT FILE NO.: FS-17-90445-00
DATE: 2019 10 08
CORRECTED: 2020 01 28
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
David Shaw Wardlaw
Applicant
- and -
Jana Wardlaw
Respondent
REASONS FOR JUDGMENT
LEMAY J
Released: October 8, 2019
Corrected: January 28, 2020