COURT FILE NO.: D14735/15
DATE: 2019 Feb 13
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Rose Lillian White
Applicant
– and –
Roy White
Respondent
M. Massey, for the Applicant
Self-represented
HEARD: January 14, 15, 16, 2019
the honourable Mr. Justice r. J. Nightingale
[1] The applicant wife brings this application against the respondent husband claiming a divorce, equalization of their net family property and spousal support.
[2] The parties were married while residing in England on November 27, 1976 having cohabited prior to that since approximately 1974.
[3] The parties then moved to Canada residing in Ontario. The applicant left the matrimonial home on May 12, 2015. The applicant moved back to England at the end of July 2015 and has continued to reside there since.
[4] There is no possibility of reconciliation between the parties and no collusion in relation to the application for divorce. Accordingly, the application for the divorce is granted based on the one-year separation of the parties which divorce shall be effective 31 days after the date of this decision.
Positions of the Parties
[5] The applicant states that the valuation date for the purposes of calculating the equalization payment is May 12, 2015, the date she left the matrimonial home after she returned from her heart surgery.
[6] She states that she is entitled to an equalization payment of $78,430 and that the respondent, who declared personal bankruptcy in April 2017, should be required by the court to transfer to her his only remaining known assets being his SunLife LIRA account of $36,243 and RRSP of $25.63 to partially satisfy that equalization payment and his spousal support obligations noted below.
[7] She claims entitlement to spousal support based on the respondent’s combined annual income of $62,000 together with retroactive spousal support.
[8] The respondent’s position is that the valuation date is March 26, 2015, the date the applicant first left the matrimonial home before her heart surgery.
[9] He states that the applicant is entitled to an equalization payment representing one-half of his SunLife LIRA account of $36,243 , which he states is his only remaining asset, and one-half of which he is prepared to transfer to her.
[10] He also states that he should not be obligated to provide any spousal support to her or to transfer the remaining half of his SunLife Lira account because of any support obligations.
Valuation Date
[11] The applicant’s evidence is that she was hospitalized in February 2015 after suffering a serious fracture of her ankle which required significant surgery. Her sister from Spain then came to care for her during her recovery at her home and left on March 24, 2015. The applicant soon realized that her jewelry was missing believing her husband was responsible and got into an argument with him in the early morning hours when he became physically and verbally abusive.
[12] She then asked to be taken the next morning to a motel for a short period of time as she was getting ready for her heart surgery because of her serious heart attack that she suffered. She had that surgery at the beginning of April and was hospitalized for three weeks because she needed 24 hour care. She returned to the home on May 10, 2015 and was told by the respondent that he would not care for or support her.
[13] The next day, May 11, she found financial documents in his car which she believed confirmed his withdrawing significant amounts of money from their accounts. That same day he told her that his job had been terminated and he would be receiving severance pay. She asked him how much he would be receiving but he refused to provide her that information. She then decided to leave and did so on May 12.
[14] The respondent’s evidence is that the applicant left the home on March 26 and never returned. He acknowledges her ankle surgery in February 2015 required her hospitalization. He acknowledges that everything was left in the house and that he could not stop her from coming back to the house as she still had her things there.
[15] He did not cross-examine the applicant on her evidence regarding the separation.
[16] In my view, the applicant’s not residing in the matrimonial home because of her heart surgery and hospitalization is not determinative of the issue of when the parties separated. The evidence is not contradicted that she returned to the matrimonial home after the surgery and recovery time required on May 10, 2015. After the further confrontation between the parties regarding the financial documents discovered by the applicant and when the respondent refused to support her and reveal the details of his severance pay that he would be receiving, she then left the next day on May 12, 2015.
[17] That evidence in my view confirms the separation date was May 12, 2015 and not the earlier date of March 26, 2015.
Net Family Property Equalization
[18] As of the date of their marriage, neither party owned any significant assets and all of the assets of the parties were accumulated during the marriage.
[19] The parties at the date of separation jointly owned their matrimonial home located at 20 Bayley Drive Paris, Ontario. That home sold for $375,000 on consent after the parties’ separation. After payment of the parties’ mortgage thereon and other accumulated debts, the net proceeds were divided equally between the parties. The applicant received the sum of approximately $27,000 which she said was used to pay her legal fees. The respondent’s equal share of $27,000 by court order was held in trust by the law firm conducting the sale of the property.
[20] The parties also jointly owned a vacation property in the Bahamas. That property was also sold in February 2018 for $260,000 USD with the consent of the applicant and the respondent’s trustee in bankruptcy after he had declared bankruptcy in April 2017. The applicant received the sum of approximately $31,000 USD being her equal share of the net proceeds of that sale after the parties’ mortgage and other accumulated debts were paid from the proceeds. The respondent’s equal share of approximately $31,000 USD from the sale of that property was provided to his trustee in bankruptcy as was his share of the house sale proceeds.
[21] The evidence indicates that all of the debts paid from the sale proceeds of both properties were either their joint responsibilities or debts that the parties agreed should be paid from those proceeds.
[22] Because of her poor health after her heart surgery and separation, the applicant returned to England at the end of July 2015 so that she could be attended to by her friends taking with her only a suitcase full of clothing. When she returned here in September 2015, she saw that she had she had a minimal amount of the contents of the matrimonial home stored in a storage locker. She stated they had no significant value and the proprietor of the storage unit purchased them for only $600.
[23] At the date of separation, the applicant owned a 2005 BMW motor vehicle which was sold by her to her friend to help cover her legal fees for $5500. Other than a few paintings from the matrimonial home which had little value and which she left in the car for her friend, she took no other assets or contents from the house. Her evidence was that she had significant amounts of jewelry valued at $5000 to $10,000 including sapphire and diamond rings, gold bracelets and pearls left in the house when she was hospitalized and which were gone when she was discharged from the hospital and went to England. Her jewelry has never been returned to her.
[24] Her evidence was that she did not know what happened to the entire contents of their matrimonial home.
[25] In addition to retaining the majority of the household furnishings and contents and his 2007 BMW vehicle worth $12,000 on separation, the husband also kept significant amounts of tools and garage equipment which he evaluated at $2600 in his financial statement and which the applicant states was worth $15,000 in hers.
[26] He also cashed in a Sun Life insurance policy receiving $6560.15 shortly before the separation. He said he used those funds to pay debts but no details or supporting documentation were provided.
[27] He disclosed in his financial statement sworn August 13, 2015 that the value of his Sun Life pension, RRSP’s tax-sheltered and after tax accounts was $170,570.23 as of the valuation date.
[28] The applicant provided a net family property statement calculating the value of the applicant’s net family property at $128,292.33 as of the valuation date. The respondent’s net family property value on the same date was $285,153.92. That net family property statement is attached to this decision as Schedule A. The respondent did not provide his NFP statement.
[29] Both NFP numbers include the particulars of the value of the matrimonial home and Bahamas properties and the debts that were paid from the proceeds of the sales. The respondent’s net family property included the total value of the Sun Life pension plan, RRSP, and other accounts of $170,570.23 but on the parties’ agreement did not include the significant severance package proceeds of $104,469 the respondent received in June 2015 after the parties’ separation.
[30] With those figures the applicant calculated the equalization payment owing to her of $78,430.80. The respondent agrees with that figure and in fact admitted in his bankruptcy documents that it was the proper equalization payment owing to her when he filed for bankruptcy in April 2017. I accordingly accept that that sum of $78,430.80 is the equalization payment owing by the respondent to the applicant.
[31] The applicant obtained an Order of Arrell J of October 13, 2017 adding the bankruptcy trustee as a party to this proceeding for the motion and lifting the stay of proceedings against the respondent. The Order further provided that the applicant could continue her claim for an equalization of the net family property for the purpose of obtaining a remedy against the respondent’s pension, severance payment, registered retirement savings plan, cash surrender value of life insurance policies and all other exempt assets which do not vest in the trustee in bankruptcy. Schreyer v. Schreyer, 2011 SCC 35 (S.C.C.).
[32] The respondent’s evidence was that all that is presently left of the $170,970.23 Sun Life pension and other amounts is the SunLife LIRA account of $36,243 and a small SunLife RRSP of $25.49 (as of September 30, 2018) stating he used the balance of the funds after the parties’ separation to pay debts including some carrying costs for the Bahamas property. However, he produced no details or documents whatsoever to confirm that he had and if so, what debts and the amounts thereof were paid. His evidence was that he has no other funds remaining.
[33] Similarly, he admitted that he spent all of his severance money he received in June 2015 and then declared bankruptcy in April 2017. He provided no evidence as to how that money was spent including whether any of it was used to pay off any debts of his or the applicant. When asked why he didn’t advise the applicant how much severance money he received at the time, his answer was “why would I?” and that there was no reason for her to know that.
[34] After separation, he sold his 2007 BMW for $7000 and then leased a new Nissan motor vehicle. He provided no accounting as to where that $7000 went after he sold the vehicle.
[35] His evidence was that he did not file for bankruptcy for spite even though the major unsecured debt was the $78,430 equalization payment owing to her.
[36] Accordingly, the respondent shall pay to the applicant the sum of $78,430 as her equalization payment.
[37] It is clear that given the respondent’s conduct in disposing of almost all his assets and his bankruptcy, it is necessary to protect the applicant’s equalization payment by requiring the transfer of 50% of the respondent’s remaining SunLife Lira and RRSP accounts.
[38] Accordingly, pursuant to Section 10.1 of the Family Law Act, in order to partially satisfy the respondent’s equalization payment owing to the applicant, the respondent shall transfer to and vest in the name of the applicant one-half of the value of the amounts in the respondent’s SunLife RRSP account # L2432837 and SunLife LIRA account # L3131826. The respondent is required to cooperate fully with the administrator of those accounts and promptly sign all necessary documentation to give effect to this order.
Spousal Support Claim
[39] The applicant is 62 years of age and the respondent is 63. Their total cohabitation including prior to their marriage was approximately 42 years before they separated in May 2015.
[40] During the marriage after the parties moved to Canada, the respondent husband was the main income earner of the family unit being gainfully and fully employed at all times during the marriage. He earned approximately $102,000 to $106,000 annually in income from his employer Siemens for the last few years of their marriage.
[41] The applicant also worked for a number of years prior to the parties’ separation as a broker for her leasing company earning approximately $50,000 per year. In approximately 2007, she had an exceptional year earning approximately $300,000 when she removed substantial funds to purchase the parties’ Bahamas property at considerable income tax expense which was then being paid over time and of which approximately $55,000 was still owing on separation in 2015.
[42] Her 2013 and 2014 income tax returns prepared by the respondent confirmed she had no income from her leasing business although she candidly admitted that there might have been a small amount of income she earned in those years.
[43] The applicant was responsible as the primary caregiver raising their child who is now an independent adult and also did all the cooking for the family unit. The parties shared and jointly performed other usual living tasks including grocery shopping and housecleaning. The respondent conceded that it was a traditional marriage where the parties pooled all their resources.
[44] They enjoyed a good lifestyle while residing and working together as a family being able to take two or three vacations per year and purchase the vacation property in the Bahamas which was intended to be their retirement home. They both drove new expensive cars.
[45] Unfortunately, as indicated above, the applicant had a serious injury to her ankle fracturing it in a fall in February 2015. She then suffered a serious heart attack requiring triple bypass heart surgery which included removing a vein from her left arm area to repair the heart but causing some damage to the tendon in her arm.
[46] She has difficulty walking any significant distance and suffers significant pain the following day if she does. She is constantly out of breath and also suffers from high blood pressure which makes her heart condition worse. She could not travel to Ontario for the court hearing and gave her evidence by court order at trial via Skype. The left arm is weakened rendering her unable to lift and carry heavy items.
[47] Her doctors have advised her that she should not be working.
[48] Despite that advice, due to her poor financial position, she has attempted to find work and has applied for various jobs in England but has not been successful. The reasons for that are because of her age, her disabling medical and physical condition and the state of the job market where she resides as there are hundreds of applications for any advertised job. She cannot work in England as a leasing broker as there are no similar businesses in England. Leasing businesses there do not have income tax advantages for leasing vehicles unlike Ontario.
[49] She has not been able to do any kind of work and it is not likely that she ever will because of these factors and in particular because of her state of health.
[50] Her only source of income other than temporary monthly spousal support being paid by the respondent is her Canada Pension benefits which total $461 per month or $5071 per year. She is not entitled to any government benefits in England as she has not resided there for the required minimum 15 years.
[51] By temporary consent Order of Parayeski J of August 13, 2016, the respondent was ordered to pay her $1250 per month in spousal support but based on his annual income of $37,440 annually and her annual income of $2500.
[52] Even with that temporary support, she is not able to rent her own place because of a lack of funds and presently resides in an apartment in England with her friend who is helping her out. She presently contributes to the rent and in addition pays for half of the costs for the gas and property taxes.
[53] She has no money left over for other living expenses and is not even able to purchase clothing. She does not have a car not being able to afford one which makes it more difficult for her to enjoy life or be able to work because of her poor medical condition.
[54] She was only able to go to Spain for a short holiday with her son when her sister paid for her flight and her son paid for everything else.
[55] She is required to borrow monies on a regular basis from friends including various times where she receives $150 per week. If she doesn’t receive her spousal support cheque from FRO in a timely fashion, she is required to live on beans and toast for food until it does.
[56] At the time of the parties’ separation in May 2015, the respondent spouse received notice from his employer that his job was going to be terminated in June 2015. He was advised that he would receive severance pay which turned out to be a total lump sum payment of $104,469 gross which he eventually received in June 2015.
[57] His 2015 income tax return and supporting slips confirmed that he earned $101,230 as salary, $46,000 in income from his RRSP he cashed in and $58,782 in other income for a total of $206,051 which would have included this severance pay received.
[58] He did not produce prior to or at trial his income tax returns for 2016 or 2017.
[59] He obtained a job in March 2016 eight months after his employment at Siemens was terminated. He produced a paystub confirming that he earned approximately $16,600 as of July 22, 2016 from that employment where he earned $18 per hour. He stated that his income tax returns were with his trustee in bankruptcy but he made no effort to obtain and disclose them to the applicant or provide them to the Court in evidence.
[60] He did produce recent paystubs for 2018 confirming his total employment income for 2018 of approximately $56,000. He stated he obtained his present employment at the beginning of January 2018 now earning $25 per hour plus overtime and other benefits. He also received $6000 Canada Pension Plan income in 2018.
[61] Parayeski J’s temporary Order of August 13, 2016 requiring the respondent to pay monthly spousal support of $1250 per month commencing August 1, 2016 was based on the respondent’s then annual income of $37,400.
[62] That Order did not deal with the issue of retroactive spousal support from July 1, 2015 to the end of July 2016 and it is now necessary to consider that obligation of the respondent.
[63] For that time period of July 1, 2015 to July 1, 2016, the respondent in effect received lump sum payments of approximately $104,469 gross from his employer Siemens as a severance package to replace his income that he would have received during that time period had he continued his employment. That income for that period is commensurate with the annual income the respondent enjoyed before the separation of the parties and termination of his employment. Wilkinson v. Wilkinson 1996 8084 (ONSC).
[64] The SSAG guidelines confirm his low, mid and high range monthly support obligations of $3187, $3718 and $4053 respectively based on that income and the applicant’s income of approximately $2500.
[65] There is some evidence that the respondent used some of that income to pay for some family debts. Giving some consideration to that position and the circumstances of the parties described above, the appropriate amount of spousal support that the respondent would be required to pay to the applicant during that time period is $3200 per month commencing July 1, 2015 to and including July 1, 2016. Those support arrears accordingly would have accumulated for that time period in the amount of $41,600.
[66] In my view, given that the respondent received his severance package as a lump sum, the immediate need for some capital by the applicant that could have been paid originally from that lump sum severance payment, and the income tax consequences of a lump sum payment versus an award of periodic spousal support, this is an appropriate case where the respondent shall be ordered to pay to the applicant the sum of $25,000 as a lump sum spousal support award for that time period of July 1, 2015 to and including July 1, 2016.
[67] The temporary Order of Parayeski J regarding the respondent’s spousal support obligations was appropriate until his income increased significantly as of January 1, 2018 when he started to earn $56,000 annually plus his receipt of approximately $6000 Canada Pension Plan benefits for a total annual income of $62,000. The applicant’s 2018 income is only approximately $5000 in Canada Pension benefits.
[68] The respondent states that he has some medical issues with diabetes but nevertheless is able to continue with his appointment on a full-time basis which includes significant travel by car.
[69] In my view, the evidence is clear in this case because of the long marriage of the parties, the childcare and household duties of the applicant wife during the marriage, her dependency on the support of the respondent because of his significantly higher income during the marriage, and her age and present medical disability from working now, the applicant is entitled to significant spousal support. Moge v. Moge, 1992 25 (SCC), [1992] 3 R.C.S.813; Bracklow v. Bracklow, 1999 715 (SCC), [1999] 1 S.C.R. 420.
[70] Although the respondent’s evidence was that he has continued to work full time since the separation and that the applicant’s health was not his problem, it is certainly most relevant with respect to his obligation provide for her support because of her medical disability.
[71] The SSAG guidelines confirm her entitlement to support on a monthly basis in the low, midrange and high amounts of $1,781, $2,078 and $2,238 based on his annual income of $62,000 and her annual income of approximately $5000.
[72] In my view, the applicant should not be required to live in the abject poverty conditions in which she is presently required to live because of her medical condition and the failure of the respondent to provide reasonable spouse support for her as well as his refusal or failure to provide her with her appropriate equalization payment.
[73] The respondent shall pay to the applicant spousal support in the amount of $1900 per month commencing January 1, 2018 on an indefinite basis based on his annual income of $62,000 and the applicant’s annual income of $5000.
[74] It is not appropriate in these circumstances given the applicant’s need for spousal support and the long-term marriage of the parties to limit the respondent’s spousal support obligations until he reaches the age of 65 years. There is no evidence that the respondent will not be working after the age of 65 or that there is any mandatory retirement age with his employer.
[75] The respondent shall be entitled to credit for all support payments made by him to the applicant since the date of the Order of Parayeski J of August 13, 2016.
[76] Even after credit is allowed to the respondent for these payments made, there are still substantial spousal support arrears outstanding to the applicant as determined by this Order.
[77] In particular, there is outstanding order of lump sum spouse support of $25,000 owing by the respondent to the applicant for the time period of July 1, 2015 to July 1, 2016.
[78] Given the applicant’s dire financial circumstances and inability to provide for her own support due to her medical condition, the respondent’s ability to continue to work and his failure to provide for the applicant’s equalization payment prior to his bankruptcy, protecting her spousal support claims against the remaining one-half of the respondent’s SunLife LIRA and SunLife RRSP accounts is necessary to ensure compliance with the respondent’s lump sum spousal support obligation. Belton v. Belton 2010 ONSC 2400; Trick v. Trick 2006 22926 ONCA.
[79] It would appear that given that this is a divorce order for spousal support, an assignment order with respect to the respondent’s SunLife Lira and RRSP in favour of the applicant is not likely available to the applicant. Trick, above, @ para 51.
[80] However, the phrase “enforceable in Ontario” in Section 66 of the Pension Benefits Act includes both Divorce Act and Family Law Act orders for support for the purpose of execution. Trick, @ para 52. Accordingly, an order is granted that the applicant is entitled to the garnishment of 50% of the respondent’s SunLife Lira # L3131826 and SunLife RRSP # L2432837 on account of arrears of his spousal support obligations to the applicant.
Conclusion
[81] For the reasons set out above, a final order shall issue as follows:
a) A divorce order shall issue to be effective 31 days after the date of this decision.
b) The respondent shall pay to the applicant an equalization payment of $78,243.
c) 50% of the funds in the respondent’s Lira and RRSP accounts with Sun Life shall be transferred to and vested in the name of the applicant Rose Lillian White on account of the property equalization payment due to the applicant in the amount of $78,243.
d) The applicant is entitled to the garnishment of 50% of the respondent’s SunLife Lira and SunLife RRSP on account of his arrears of his spousal support obligations to the applicant.
e) The respondent shall cooperate and execute any forms and necessary documents required by SunLife to give effect to the transfer failing which the applicant shall be entitled to sign those forms on behalf of or as agent for the respondent.
f) The respondent shall pay to the applicant a lump sum for spousal support in the amount of $25,000 for the time period commencing July 1, 2015 to and including July 1, 2016.
g) The respondent shall pay to the applicant spousal support in the monthly amount of $1250 commencing August 1, 2016.
h) The respondent shall pay to the applicant spousal support in the monthly amount of $1900 commencing January 1, 2018 based on the respondent’s income of $62,000 and the applicant’s income of $5000.
i) The respondent shall be credited against his spousal support obligations with all support payments made by him to the applicant pursuant to the temporary Order of Parayeski J of August 13, 2016.
j) The parties shall exchange copies of their income tax returns and notices of assessment by June 1 of each year.
k) A support deduction order shall issue.
[82] If the parties are unable to resolve the issue of costs of this proceeding, the applicant shall provide brief submissions of no more than three pages in length together with a bill of costs and any relevant offers to settle within 10 days from the date of this decision.
[83] The respondent shall be similarly to respond within 10 days thereafter.
[84] If no submissions are received within these timelines, the parties will be deemed to have resolved the issue of costs.
The Honourable Justice R.J. Nightingale
Released: February 13, 2019
White v. White, 2019 ONSC 994
COURT FILE NO.: D14735/15
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Rose Lillian White
Applicant
– and –
Roy White
Respondent
REASONS FOR JUDGMENT
The Honourable Mr. Justice R. J. Nightingale
Released: February 13, 2019