Court File and Parties

COURT FILE NO.: FS-14-1295

DATE: 2019-01-25

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: FARHAD QARIZADHA, Applicant

AND: AZMINA QARIZADHA, Respondent

BEFORE: Van Melle, J.

COUNSEL: O.B. Vincents, for the applicant C. Moryto, for the respondent

HEARD: January 7 – 10, 2019

ENDORSEMENT

[1] This is the applicant, Farhad Qarizadha’s motion to change a final order. The respondent, Azmina Qarizadha, resists the motion to change and seeks an order setting aside the 2011 Order of Justice Kaufman on the basis that it was obtained by fraud. Both seek to have spousal and child support varied or terminated.

BACKGROUND

[2] The parties were married on April 2, 1992 and separated on August 23, 2007. They have four children: Manijha born June 6, 1993; Mehria born May 1, 1996; Sarah born September 4, 2000 and Suhail born September 4, 2000.

[3] The parties negotiated and executed a separation agreement dated September 28, 2008. Azmina had custody of the children and Farhad had access. Farhad was to pay child support of $2,170 plus section 7 expenses of $480 per month. He was also to pay spousal support of $450 per month based on an annual income of $100,000.

[4] In 2011 Farhad brought a motion to change his support obligations pursuant to the separation agreement, on the basis that his income had declined from $100,000 to $75,000 and that Azmina was earning an income. On May 6, 2011 the parties settled that motion to change which resulted in Justice Kaufman’s order. Child support was reduced to $1,706 per month. The parties were to share s. 7 expenses in proportion to their incomes with Farhad being attributed an income of $75,000 and Azmina being attributed an income of $25,000. Spousal support was reduced to $150 per month. Arrears were fixed at $12,500 ($20,000 in the case of default of payment). Farhad was to pay $200 per month toward the arrears.

[5] The within motion to change was commenced on March 24, 2014. The material change in circumstances relied upon is Farhad’s reduced income of $26,052. Farhad testified that today he receives assistance from Ontario Works. According to his Financial Statement dated January 5, 2019, his 2017 income was $12,209 and his 2018 income was $8,796.

[6] It is conceded that Manijha is no longer entitled to child support, having stopped school in January 2014. Mehria is entitled to support now, but as she was out of school for one year (either 2016 or 2017) child support will be adjusted to reflect that.

[7] Both parties claim that the other has sources of undisclosed income. Much of the time at trial was used trying to establish these undisclosed sources. Both claim to have health problems. Azmina in particular outlined all the medical issues that she says stop her from spending more time working as a real estate agent.

[8] Pursuant to the Trial Scheduling Endorsement, the evidence in-chief of each party was to be given by way of affidavit. Additionally, each party was allotted 90 minutes of oral evidence, presumably to supplement the evidence in the affidavits. The affidavits of both parties were replete with inadmissible evidence. It should be obvious that when evidence in-chief is to be adduced by way of affidavit, the affidavit should contain only evidence that would be admissible were the parties to give their evidence in-chief orally. For the purposes of this motion to change, I am relying only on evidence that would be properly admissible and disregarding those portions of the affidavits that are inadmissible.

Farhad’s testimony

[9] Farhad’s evidence is that he brought this motion to change primarily because of changes to his financial situation. He worked in door-to-door sales of gas and electricity contracts but was unable to continue when the Government of Ontario banned sales of gas and electricity contracts. Because of his lack of education, (having come to Canada from Iran in 1989 when he was 21 years of age) he claims that he is unable to find work. He drove for Uber for a while, but his car broke down in August 2018 and he could not afford to fix it. He remarried Lisa and had another child, but says he separated from his second wife in 2015, reconciled in 2017 and separated again in 2018. He now lives in one room which he rents from a friend.

[10] Farhad says that when the separation agreement was negotiated in 2008 he was self-employed, earning $100,000 annually. He says that his income changed dramatically in 2011. He was still self-employed as an independent contractor with Eco Energy Home Services, but business had declined which significantly affected his income. He says that despite his change in circumstances he settled the motion to change that he had instituted in 2011 and agreed to pay child support in accordance with an imputed annual income of $75,000.

[11] Farhad says that by March 2012 he was unable to continue as a self- employed contractor as his earnings could no longer support his day to day living expenses. He got a job at a retail store, YM Inc. as a salesperson in March 2012. His employment there was terminated without cause on August 31, 2013. He applied for Employment benefits and received employment insurance of $501 per week.

[12] Sometime in 2014 he was re-employed by Eco Energy at a much lower pay grade. He says that due to financial hardship at this time, he sold his home at Tamarind Vale, Brampton to re-pay debts. He moved into his brother’s house temporarily.

[13] He was selling gas and electricity contracts (door to door) for Eco Energy Home Services and was forced to leave due to the failing market. He then started selling water heaters for Eco Energy (door to door). He says that changes in the laws in Ontario (as detailed above) have made it impossible for him to continue this employment.

[14] He states that he is partially literate in the English Language, being able to speak English, but unable to write it.

[15] From 2009 to 2012 he owned a business known as Seal-A-Deal, which business did well in the first 2 years but declined in 2012 and was eventually closed in 2012 after it stopped being profitable.

[16] He states that he’s borrowed significant amounts of money from his family and friends. In particular from his cousin Rokshana Baryole who appears to have been lending him money since September 14, 2009 until at least 2017.

[17] Farhad testified that when he lives with Lisa they live at 75 Jackson Road. The property was purchased sometime in 2017 for $525,000. Somehow his wife was able to qualify for a mortgage of $420,000. Azmina’s lawyer asked for disclosure related to Farhad’s second wife, Lisa. He asked for the source of the down payment for the house; mortgage application; proof of Lisa’s income for 2 years; details of Farhad’s contribution and a copy of the Agreement of Purchase and Sale. Farhad says he did not provide any of the documentation because Lisa refused to give it to him.

[18] He says that his wife’s relatives assist her in paying for the mortgage and that he pays for groceries and the remaining utilities bills. His wife works at Mary Brown’s.

[19] According to his Notices of Assessment Farhad’s income was as follows:

2007 $33,500 2008 $44,566 2009 $51,200 2010 $29,275 2011 $31,471 2012 $48,055 2013 $62,994 2014 $23,621 2015 $13,320 2016 $15,569 2017 $12,209

[20] After separation, in 2008 Farhad purchased 201 Embassy Drive for $550,000 and sold it in 2011 for $615,000. He purchased 55 Moonstone Place in 2011 for $619,000 and sold it in 2012 for $732,000. He then purchased 4 Tamarind Vale in 2012 for $527,500 and sold it in 2014 for $560,000.

[21] Subsequently Farhad moved into a home in his new wife’s name at 5 Jackson Road, Brampton. In addition to Jackson Road, he continued to rent a basement apartment since May 2017 at 13 Zebra Trail, Brampton.

[22] Farhad qualified for mortgages on all three properties. The mortgage application for a mortgage with TD (on Moonstone property) shows Farhad’s income as $95,000. He is shown as being a Senior Sales Manager with Londoni, which is apparently a gold mining company associated with his cousin Rokshana Bayole. His occupation is “professional”. His assets are listed at $554,500 and liabilities as $70,000. He had a down payment for Moonstone from the sale of existing property of $123,800.

[23] There is another mortgage application signed September, 2011 where Farhad’s income is $93,000. On that document he is shown at the owner of Seal-a-Deal Inc.

[24] There is another mortgage application from July 2012 where Farhad is shown as being a Senior Sales Manager with Londoni Gold Corp. His annual income is shown as $95,000. His assets are listed at $287,500 and his liabilities at $88,420.

[25] When questioned about the mortgage applications his answer was that the documents were filled in by the mortgage broker and he just signed where he was told to sign. He stated at paragraph 19 of his affidavit containing his evidence in-chief:

The Respondent mother is of the impression that I earned $95,000 in 2012, because the Mortgage application for 55 Moonstone Place, the property in which I lived before purchasing 4 Tamarind Vale, states that I worked for Londoni Gold Corp earning an annual income of $95,000. I did not work for Londoni Corp and I did not earn $95,000. The document was used to qualify me for the mortgage. The mortgage broker provided all the documents for the mortgage application and all I did was sign the application.

Azmina’s testimony

[26] Azmina says that she trained as a real estate agent in 2006 but that she was not earning an income at the time of separation. She says that she used her share of the proceeds from the sale of the matrimonial home to purchase the home where she and the children still live today at 90 Via Romano Way, Brampton.

[27] She says that since May 6, 2011 she has been raising the children largely on the child support, spousal support and arrears payments that she received from Farhad, but has been experiencing financial difficulties since he reduced the amount of support to $1,000 per month.

[28] She says that she has severe physical and medical [sic] impairments that have limited her ability to earn income while caring for her children. She has had to rely on her family for financial help, mostly in the form of loans from her mother, brother and sister’s husband from time to time. Her brother, Mohamed Bakar Somani testified at trial to corroborate the fact that she has received significant loans from him, her mother and her sister and brother-in-law. Mr. Somani explained that he tried to track everything on a spreadsheet but it did not capture all of the money that she had received from her family. He felt it was approximately 90% accurate. The spreadsheet documents loans as of November 2017 of $214,000. Mr. Somani gave his testimony in a very forthright manner and I found him to be extremely credible.

[29] She seeks to have spousal support increased to reflect the Spousal Support Advisory Guidelines and to offset any reduction in child support associated with one of the children no longer being dependent.

[30] In her affidavit containing her evidence in chief Azmina says that her medical issues are:

Dislocation of her tailbone; cervical spine disease affecting the C6-C7 region of her lower neck; carpel tunnel syndrome; epilepsy; myasthenia gravis [mysthnia glavis in her affidavit] hyperthyroidism; and depression.

[31] She says that surgery was recommended but she was so fearful of the risks associated with the surgery that after much consideration she could not proceed. She did not set out the risks, so I am unable to assess whether or not her fears were reasonable.

[32] She testified that although she is able to work she requires a great deal of rest which hampers her ability to work full-time.

[33] Dr. Benjamen testified on Azmina’s behalf. She has been Azmina’s doctor since 2007. She outlined Azmina’s medical issues. She said that Azmina has severe degenerative disease; some evidence of C7 nerve impingement; neck pain; stiffness; difficulty with lifting her arms; difficulty turning her neck; difficulty sleeping; carpel tunnel which is moderate to severe; sciatica; osteoarthritis; history of epilepsy and myasthenia gravis.

[34] She said that Azmina had experienced grand mal seizures and absence seizures (where she would blank out for a couple of seconds.) She testified that as far as she knew Azmina had not experienced any epileptic seizures for the last seven years.

[35] She said that the myasthenia gravis was mild and was just being monitored. Azmina was not taking any medication for myasthenia gravis or for epilepsy.

[36] Dr. Benjamen’s testimony was helpful. Although I accept that Azmina has had the issues she describes, there is nothing in the evidence to suggest that she is not able to work as a real estate agent at the present time. Thus I am not going to increase the spousal support payable to Azmina.

ADVERSE INFERENCE

[37] Azmina asks that I find an adverse inference against Farhad based on his failure to call witnesses who could have clarified the situation. She says that Farhad should have called Rokshana Bayole, his brother - Farzad Qarizadha, Michael Sifontes and his present wife, Lisa Qarizadha. I agree. These witnesses all reside locally. Their testimony would have been extremely helpful. The failure to call these witnesses does lead me to draw an adverse inference. Farhad was well aware that Azmina’s position is that he is receiving funds from Rokshana Bayole and from Michael Sifontes because he works for them. He is aware that Azmina claims that Farhad’s brother Farzad purchased properties for Farhad.

[38] Farhad’s testimony regarding the mortgage applications is just not credible. Farhad could also have called the mortgage broker as a witness and indeed could have produced the entire mortgage broker file. I do not believe that the mortgage broker would have confirmed Farhad’s evidence regarding the mortgage applications. If Farhad’s testimony is true, that would constitute mortgage fraud by all involved, which is of course a very serious allegation.

[39] Farhad testified that from 2009 to 2012, he owned a business called Seal-A-Deal which did well in the first 2 years, but declined in 2012 and was eventually closed in 2012. He says that he has been borrowing money from family and friends in order to continue making the support payments. And yet during this time he qualified for and made monthly payments on mortgages at Embassy Drive and Moonstone Place.

[40] Azmina believes that Lisa and Farhad are not separated. Farhad testified that he spends a great deal of time with Lisa and that their daughter, who is 6 years old, does not know they are separated. His testimony regarding the circumstances under which his present wife purchased 75 Jackson is also not credible. Particularly when Farhad acknowledged that Lisa’s income from Mary Brown’s has been as follows:

2011 $11,000 2012 1200 (from UCCB) 2013 6,991.21 2014 1,200

[41] Unfortunately Lisa was not called as a witness at trial so none of the questions relating to her relationship with Farhad were satisfactorily answered.

[42] A comparison of Farhad’s last two Financial Statements shows a reduction in the loans payable to family and friends of $4,000. Farhad’s Financial Statement sworn December 27, 2017 shows debts to family and friends in the amount of $88,000. His Financial Statement sworn January 5, 2019 shows debts to family and friends of $84,000.

[43] There is no explanation as to where the funds to pay down the loans came from. In any event, I do not accept his testimony regarding loans from family and friends.

[44] I do not accept Farhad’s claim that he cannot earn as much money as he once did because of the Ontario Government’s change in regulations. There was little, if any, evidence regarding Farhad’s genuine attempts to find other employment. I suspect that is because he does in fact do work, and get paid, for his cousin, Ms. Bayole and for Mr. Sifontes as well. This is bolstered by the mortgage applications and the fact that there is no satisfactory explanation as to why Londoni would be on the application as his employer.

[45] I do not accept that there has been a material change of circumstances insofar as the incomes of the parties are concerned. I do not accept that Farhad is not earning $75,000 as was imputed to him in 2011. An examination of his Notices of Assessment throughout the years, demonstrates that he never claimed as income as much as the $100,000 he admits to earning when the parties first separated, or the $75,000 that he agreed be imputed to him in 2011. The incomes on his Notices of Assessment have not changed dramatically.

[46] I accept that the children of the marriage are older and are well able to look after themselves physically. I accept that although Azmina has some physical issues, she is able to work full-time and support herself. I accept that child support will have to be recalculated keeping in mind that Manijha left school in January 2014 and Mehria did not go to school for a one year period.

[47] Azmina claims that there are outstanding arrears and there may well be. I asked Azmina’s counsel what the arrears were and if the arrears were under the order of Justice Kaufman. This is important because the order stipulated that the arrears would go from $12,500 to $20,000 if he were in default of his support obligation. [In the event of a default in payment of the ongoing support and/or the arrears of support for a period greater than 30 days the full amount of the arrears owing at the time of settlement in the amount of $20,000 less any payments made shall be due and owing.] Counsel’s response was that it depended on how payments were allocated. Payments should be allocated to the oldest arrears first. I have no evidence as to when arrears accrued, or indeed what the arrears are. Farhad seeks to have all arrears wiped out, but I will not do so as again, I have no satisfactory evidence on this issue.

[48] Azmina seeks to have the order of Justice Kaufman set aside and have child and spousal support recalculated from the date of the order. She says in her pleadings:

a. The Applicant misled the Court and the Respondent in obtaining a reduction in his support obligations pursuant to the Order of Justice Kaufman dated May 6, 2011. Based on his representations to the Court and the Respondent he was able to secure a reduction based

on a reduced income from $100,000 to $75,000. Just a few months later the Applicant applied for a mortgage and stated his income as $93,000 per year. The following year he purchased another home and in that mortgage application he stated his income as $95,000 per year.

b. The Respondent believes the Applicant secured the reduction in support payable in the May 6, 2011 Order by fraudulent misrepresentation and it ought to be set aside and replaced with the previous order based on the Applicant’s income as stated in the party’s [sic] separation agreement of $100,000 which was filed with the Court on September 1, 2009.

[49] In support of the claim to have the 2011 order set aside Azmina relies on the case of Mohamed v. Mohamed, 2018 ONCJ 530. Justice Sherr said:

47 Setting aside an order under clause 25 (19) (a) requires a high threshold. Fraud within this clause does not have a special meaning outside of the common law. A moving party must clearly prove that the other party knowingly or recklessly made a false statement with knowledge of the falsehood and did so with wrongful intent. See: Hatuka v. Segal, 2017 CarswellOnt 14911 (Ont. S.C.J.), per Justice Heather McGee.

48 In M. (P.) v. M. (S.), 2014 ONCJ 541 (Ont. C.J.), at paragraphs 36 to 38, this court reviewed the jurisprudence about requests to set aside orders on the ground of fraud and noted the following:

a) The fraud alleged must be proved on a reasonable balance of probability. The more serious the fraud, the more cogent the evidence is required.

b) The fraud must be material, going to the foundation of the case.

c) The evidence of fraud must not have been known at the time of trial by the party seeking to rely on it. The party must show that there has been a new discovery of something material, in the sense that fresh facts have been found, which, by themselves or in combination with previously known facts, would provide a basis for setting aside the order.

d) If a litigant wishes to challenge a procedural irregularity in a court order or pleading, they should do so promptly. They should not be taking substantive steps in a case and waiting until a later time to proceed with the procedural challenge. This is known as the "fresh step principle". While the "fresh step" principle is not an absolute bar to the court considering a procedural attack on an order after a substantive step is taken in a case, consideration of the principle is consistent with the primary objective in rule 2 when determining whether it is just in the circumstances to set aside or change an order.

49 The court also has the authority to set aside a consent order where there are proven grounds of common mistake, misrepresentation, fraud or any other ground which would invalidate a contract. See: Joshi v. Joshi, 2014 ONSC 4677 (Ont. S.C.J.); Webster v. Suteu, 2015 ONCJ 538 (Ont. C.J.).

[50] The misrepresentation relied on is the failure to advise that Farhad had entered into an agreement of purchase and sale for a house, at the time that the consent underlying the order of Justice Kaufman was entered into. Farhad testified that he did not disclose the fact of the agreement because he was not yet the owner of the house as the transaction had not been completed. I am not satisfied that if this was in fact a misrepresentation that it meets the threshold required to set aside a consent order. I am not satisfied that had Azmina known about the pending transaction, she would not have entered into the consent upon which Justice Kaufman’s order is based.

DECISION

[51] Farhad has not established a material change in circumstances. His motion to vary is dismissed. There should, however, be adjustments to the child support payable. The child support is to be varied and recalculated to reflect the following:

1. The fact that Manijha stopped being entitled to child support as of January 2014.
2. The fact that Mehria was not entitled to child support for the one year period that she was not in school.
3. Subject to the above variations, Farhad should be paying the table amount of child support for three children.

[52] Azmina has not established that there should be a variation to the Order of Justice Kaufman. Her motion is dismissed as well.

[53] I asked counsel to put any relevant Offers to Settle and Costs’ Outline in an envelope to be opened by me after I had made a decision.

[54] Neither party’s offer equals or betters my decision. I note however, that Farhad made an offer dated October 18, 2017 that he would continue to pay child support for the children eligible for support, based on an imputed income of $78,000. He wanted to terminate spousal support as at October 1, 2017. In my view this is a reasonable offer and very close to the actual amount (when one takes the tax consequences of spousal support into account) to what Azmina is getting under Justice Kaufman’s Order. Had the offer been accepted, both parties would have avoided legal fees for the last fifteen months.

[55] Farhad’s Bill of Costs is 86,417.86.

[56] Azmina’s Bill of Costs is $158,269.42.

[57] Without doing a minute examination of the respective Bills of Costs, I assume that at least one half of the amounts relate to work done after October, 2017. Had Farhad’s offer been accepted, the parties would have saved at least $120,000. This is most unfortunate as it was clear to me that the parties are not in a financial position to expend this kind of money on legal fees in a case such as this.

[58] Although it would have been wise for Azmina to have accepted Farhad’s offer of October, 2017, I find as well, that Farhad’s counsel’s conduct in cross-examining Azmina about many of her gas purchases, did not serve to advance Farhad’s case and took up a great deal of trial time. Thus, given that neither party was successful at trial, there shall be no order as to costs.

Van Melle, J.

Date: January 25, 2019

COURT FILE NO.: FS-14-1295

DATE: 20190125

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: FARHAD QARIZADHA, Applicant

AND: AZMINA QARIZADHA, Respondent

BEFORE: VAN MELLE J.

COUNSEL: O.B. Vincents, for the applicant C. Moryto, for the respondent

ENDORSEMENT

Van Melle J.

DATE: January 25, 2019