COURT FILE NO.: FC-19-2545
DATE: 2020/10/28
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Suzanne Clydeth Dennis, Applicant
AND
Nicholas William Spears, Respondent
BEFORE: Justice Engelking
COUNSEL: J. Nevada Fenton, for the Applicant
Jillian Allen, for the Respondent
HEARD: October 22, 2020
ENDORSEMENT
[1] This is the Respondent, Mr. Spears’ Motion requesting an order setting aside the noting in default order of Master Fortier dated February 28, 2020 and the final divorce order of Justice Laliberte granted on July 22, 2020 at an uncontested trial.
[2] The Applicant, Ms. Dennis seeks an order dismissing Mr. Spears’ motion.
[3] The parties commenced living together in or about September of 2008 and married on April 11, 2011. Two children were born on of the marriage, Savannah Trinity Spears on January 4, 2009 and Raven Victoria Spears on September 24, 2013.
Procedural History
[4] Ms. Dennis commenced an application for Divorce on December 30, 2019, which application was signed by her on December 20, 2019. In her application for Divorce, Ms. Dennis indicated that the parties have lived separate and apart since May 9, 2019 and also checked off the box under “Important Facts Supporting My Claim For Divorce” which indicates that the spouses “have not lived together again since that date in an unsuccessful attempt to reconcile.” Additionally, in paragraph 3 under the heading “Important Facts Supporting My Other Claims”, Ms. Dennis indicated: “Nicholas and I separated on May 9, 2019. We are currently living separate and apart under the same roof.” Ms. Dennis set out a number of additional claims, which included custody of the children, child support and contribution to section 7 expenses, spousal support, security for support, equalization of the parties’ net family properties and sale of the matrimonial home. With respect to the latter claim, Ms. Dennis provided in paragraph 14 of the “Important Facts Supporting My Other Claims” that while she was prepared to have Mr. Spears purchase her interest in the matrimonial home, she was not sure of his ability to do so financially. She indicated: “Therefore, the house should be listed for sale so that the equity can be extracted.”
[5] Mr. Spears acknowledges that on January 6, 2020, he was served personally with the Application for Divorce and a number of other documents, which included a Case Conference Notice. The Notice confirmed that a Case Conference was scheduled for February 28, 2020. Mr. Spears was also provided with a blank Form 10: Answer and blank Form 13.1 Financial Statement. Notwithstanding that Mr. Spears received these blank documents, he did not serve and file an Answer or Financial Statement.
[6] A Ms. Lauren Rodger of the office of Ms. Dennis’ counsel swore an affidavit on February 19, 2020 indicating that she had made an order, under Order #W942884, for a next day courier with “Personal Touch Courier” to pick up the Case Conference Brief of Ms. Dennis at 8:30 a.m. on February 20, 2020 for delivery to Mr. Nicholas Spears at 14 Eagleview Street, Kanata, Ontario (the address of the matrimonial home). The Order #W942884 indicates on the bottom of the page: “The Order is confirmed and a courier will be at the pickup address shortly (No pickups before 8:30 a.m.)” The court has been provided no proof that the document was indeed picked up, or that it was delivered. Mr. Spears disputes that he was ever served with the Case Conference Brief or confirmation. Ms. Dennis insists that he was, as she recalls seeing the documents which were served sitting on their dining room table on February 20, 2020 (the parties still living separate and apart in the same home, which they continued to do until September 3, 2020.)
[7] Although he was aware of the Case Conference date, Mr. Spears did not attend court and Ms. Dennis requested that he be noted in default. On February 28, 2020, Master Fortier noted in paragraph 4 of her endorsement: “The Respondent has not provided Responding materials although served with the Application and supporting materials on January 6, 2020. The Respondent did not appear at today’s case conference.” In other words, nothing turned on proof of service of the case conference brief, rather, in keeping with the Rules of Family Law, it turned on proof of service of the Application and whether an Answer had been filed. The deadline for Mr. Spears to serve and file his Answer was February 5, 2020. Master Fortier went on to note Mr. Spears in default in paragraph 5 of her endorsement.
[8] Ms. Dennis filed her Affidavit for an uncontested trial on March 11, 2020 and the matter was originally scheduled for an uncontested trial to be heard on April 28, 2020. However, the matter was temporarily adjourned due to the COVID-19 pandemic. It was later rescheduled to be heard on July 22, 2020. On that date, Justice Laliberte granted the Final Divorce Order requested, the contents of which are attached hereto as Schedule “A”. Mr. Spears was not served with the March 11, 2020 Affidavit for an uncontested trial.
[9] Mr. Spears became aware of the Final Order on or about August 9, 2020 after Ms. Dennis told his father to have him check his email accounts. On or about August 13, 2020, Mr. Spears communicated with a legal referral service and scheduled an initial consultation with a lawyer, Ms. Diane Lafleur on August 17, 2020. He retained Ms. Lafleur on that date. Ms. Lafleur received copies of the pertinent documents from the court counter on August 27, 2020, and she prepared a motion seeking an order staying the provisions of Justice Laliberte’s order and deeming the hearing of a motion to set aside the default finding and Final Order urgent. Ms. Dennis and her counsel were served with Mr. Spears’ motion on September 4, 2020.
[10] Justice Audet dealt with Mr. Spears request that the matter be deemed urgent on September 14, 2020. Justice Audet found that Mr. Spears was free to bring his motion requesting an order to set aside the noting in default and the Divorce Order pursuant to Rule 25(19)(d) of the Family Law Rules, but that his motion was not urgent.
[11] The matter was first scheduled before me on October 5, 2020 and then again on October 14, 2020. Mr. Spears requested an adjournment on both dates, the first because his then counsel, Ms. Lafleur, was struggling with the death of a very close friend, and the second because he had changed counsel. The motion proceeded on October 22, 2020.
The Legal Test
[12] In Gray v. Gray, 2017 ONCA 100, the Ontario Court of Appeal found at paragraph 26 that “r. 25(19)(e) includes the authority to set aside an order.” Rule 19 of the Family Law Rules provides:
25(19) The court may, on motion, change an order that,
(a) Was obtained by fraud;
(b) Contains a mistake;
(c) Needs to be changed to deal with a matter that was before the court but that it did not decide;
(d) Was made without notice; or
(e) Was made with notice, if an affected party was not present when the order was made because the notice was inadequate or the party was unable, for a reason satisfactory to the court, to be present. (Emphasis added).
[13] Both parties agree that the test to set aside a final order is as set out by Madam Justice Kristjanson in paragraph 9 of Lin v. Ha, ONSC 6917, relying on the Ontario Court of Appeal case of Mountain View Farms v. McQueen, 2014 ONCA 194 at paragraphs 48 and 49. Justice Kristjanson articulated the test to contain the following five criteria:
a. Was the motion brought promptly after the moving party learned of the default judgment (i.e. timeliness of motion to set aside)?
b. Is there a plausible excuse or explanation for the moving party’s default in complying with the Rules?
c. Has the moving party set out facts that support the conclusion that there is at least an arguable defence on the merits?
d. What is the potential prejudice to the moving party should the motion be dismissed, and the potential prejudice to the party obtaining the Order should the motion be allowed?
e. What is the effect of any order the court might make on the overall integrity of the administration of justice?
Criteria a.
[14] I have little difficulty finding that Mr. Spears acted promptly upon learning of the existence of the final order of Justice Laliberte. Indeed, he acted within days of first becoming aware of the order on August 9, 2020 and had retained counsel by August 17, 2020. Unfortunately, neither Mr. Spears nor his counsel appears to have communicated with either Ms. Dennis or Ms. Fenton prior to serving them with Mr. Spears motion materials on September 3, 2020. Nevertheless, Mr. Spears has acted promptly to seek to set aside the noting in default and Divorce Order once he became aware of them.
Criteria b.
[15] I have much more difficultly reaching a conclusion that Mr. Spears has a plausible excuse or explanation for his default in complying with the Family Law Rules. Mr. Spears’ position is that he was “manipulated and induced by error by the Applicant to not participate in the divorce proceedings”. His evidence is that upon being served with the application for divorce, he had a conversation with Ms. Dennis wherein she told him not to worry about the divorce proceedings and that she had only filed the application “to start negotiating out of court and that if negotiation fails that we would move forward with the divorce proceedings.” Mr. Spears alleges that Ms. Dennis assured him that they were going to resolve matters amicably outside of court and that “the first court date would be cancelled, she would not attend”. The difficulty with these allegations is that Mr. Spears has provided the court with no evidence whatsoever regarding the parties’ attempts to work anything out by negotiation. There was no exchange of financial disclosure, no attempt at communication by Mr. Spears with Ms. Fenton and no evidence of an agreement having been drafted. Indeed, in his affidavit sworn on September 3, 2020, Mr. Spears contradicts his own claim that he and Ms. Dennis had reached or were reaching an agreement on the disposal of the matrimonial home. At paragraph 28 h., Mr. Spears indicates:
I proposed to purchase the financial interest of the Applicant Mother in our jointly own [sic] home. I offered to secure the payment by remortgaging the home to pay her financial interest in the matrimonial home to ensure the children continue to thrive in their childhood home, my offer was rejected; (Emphasis added).
[16] Again, in paragraph 21 of his reply affidavit sworn on September 8, 2020, Mr. Spears indicates: “I offered to settle the issue of the matrimonial home and the Applicant rejected.” If this was indeed the case, that they could not resolve the issues between them, then is seems that proceeding with Ms. Dennis’ application was the logical next step. Why Mr. Spears thought that not to be the case is not entirely clear.
[17] In paragraph 39 of his supplementary affidavit sworn on October 5, 2020, Mr. Spears contradicts his own previous evidence on the matrimonial home by saying: “She agreed to sell me her interest in the matrimonial home; She understood that I wanted to buy it to ensure the children would continue living in the same household they were born in”. (Emphasis added). At paragraph 40 of that same affidavit, Mr. Spears indicates that he and Ms. Dennis discussed custody and access issues and he states: “The Applicant knew that I wanted shared custody of the children.” (Emphasis added). Mr. Spears appears to equate his expression of what he wanted as evincing agreement between him and Ms. Dennis, which it clearly does not. Mr. Spears stated at paragraph 41 of that affidavit: “It is in this context that I did not file an answer, my financial information and did not attend the case conference held on February 28, 2020.”
[18] Ms. Dennis adamantly denies Mr. Spears’ allegations that she misled him or the court in any way. Her evidence, confirmed by an email chain between her and Mr. Spears commencing April 30, 2019 and attached as Exhibit “H” of her affidavit sworn on September 28, 2020, is that she first requested that Mr. Spears complete financial disclosure by no later than May 9, 2019 for the purposes of attending mediation together with Heidi Ruppert. In that email, Ms. Dennis stated: “I can file our taxes for 2018 and use that filing date as the end of our relationship.” As I have indicated above, Ms. Dennis used May 9, 2019 as the parties’ date of separation in her application for divorce and indicated therein that the parties had not reconciled since that date. Ms. Dennis’ evidence is that Mr. Spears did not provide the requested financial form to Ms. Ruppert or her firm, Ruppert McCarthy. Mr. Spears agrees that he did not do so, but says the reason is because he and Ms. Dennis reconciled and continued to live as a couple. Although Mr. Spears states that they presented themselves as such to friends, family, employers and neighbours, he has provided no third-party evidence to this effect. Mr. Spears relies solely on a family photograph taken at Christmas of 2019 which includes him, Ms. Dennis and the children, along with others, as proof that they were living as couple. Ms. Dennis says that they celebrated Christmas as a family for the sake of the children and because they were still residing in the same home, but that they were not living as a couple. Indeed, Ms. Dennis had signed her Divorce Application on December 20, 2019, which was likely a few days before the undated photograph was taken.
[19] Ms. Dennis’ evidence is that it was due precisely to Mr. Spears’ failure to provide financial disclosure and to participate in negotiations with her to resolve the outstanding issues of the breakdown of the marriage that she ultimately had to retain counsel and file the divorce application. Even after being served with the application, Mr. Spears did not provide any financial disclosure to Ms. Dennis. In his original materials in support of this motion (his September 3, 2020 affidavit), Mr. Spears provided only three recent paystubs as evidence of his income. In his supplementary affidavit of October 5, 2020, Mr. Spears indicated that he had found his 2019 T4 and sought permission to file it. While Mr. Spears had identified his income to be $56,400 in paragraphs 29 and 77 of his September 3, 2020 affidavit, his 2019 T4 identified his employment income to be $69,366.89. After some correspondence between the parties about a missing Exhibit “L” to his October 5, 2020 affidavit (which is also missing from the court copy), Mr. Spears also produced his 2017 CRA Notice of Assessment, which evinced a Line 150 income of $80,316. Mr. Spears has never produced his 2018 T4 or his 2018 or 2019 Income Tax Returns or Notices of Assessment. He asserts that Ms. Dennis should be aware of his income because she historically prepared their tax returns. Ms. Dennis indicates that while she did historically prepare their tax returns, she did not keep copies of Mr. Spears’ returns, and that she ceased preparing his returns after the 2018 tax year because they were separated. That she did cease is entirely consistent with her position on the date of separation.
[20] For reasons that are not entirely clear, Mr. Spears has identified January 13, 2020 as their date of separation. This is notwithstanding that Ms. Dennis signed an Application for Divorce on December 20, 2019 (which identified their date of separation as May 9, 2019), filed it with the court on December 30, 2019 and served it on Mr. Spears on January 6, 2020. It is Mr. Spears position that Ms. Dennis has committed fraud by obtaining the divorce on July 22, 2020, because, according to him, the parties had not lived separate and apart for more than one year as is required by the Divorce Act. On the evidence before me, it seems that in Mr. Spears mind, the relationship was not over until he accepted it was over, which appears to be on or about January 13, 2020. The law does not require, however, that the parties be ad idem about when a relationship is over. According to Ms. Dennis’ evidence, it was likely over even before the May 9, 2019 date of separation that she communicated to Mr. Spears, both in their email exchange of April 30, 2019 through May 7, 2019 (in which she asked for him to complete the task of filing out the required financial form by May 9, 2019) and in her application for Divorce. On a balance of probabilities, I find that the date of separation is, at least, May 9, 2019.
[21] While I accept that Mr. Spears may have felt “blind-sided” when he received the divorce application on January 6, 2020, as he attested in paragraph 62 of his September 3, 2020 affidavit, it was still his (sole) responsibility to respond to the application and participate in the court proceedings. This is particularly so if he was of the view that the separation date Ms. Dennis used in her application was not the correct one. Mr. Spears’ position that Ms. Dennis was advising him that she did not intend to proceed with the case conference, moreover, is completely inconsistent with her preparation of a Case Conference Brief, and her arrangement for service of it on him by courier, whether he acknowledges receiving it or not.
[22] I accept Ms. Dennis’ evidence that she was simply trying to get matters resolved, originally through mediation or negotiation and later by court application. Mr. Spears did not respond to either overture of Ms. Dennis. Mr. Spears attempts to lay the blame for that at the feet of Ms. Dennis, rather than take responsibility for the fact that he did not do anything that was required of him, including ever contacting Ms. Fenton. (It appears likely that he did not do his 2019 Income Tax Return after Ms. Dennis ceased doing it for him as well). I find that Ms. Dennis’ evidence as to the course of events is more credible, because it is more consistent. As a result, I do not find that Mr. Spears has a plausible excuse or explanation for his failure to comply with the Rules.
Criteria c.
[23] Mr. Spears submits that he has an arguable defense on the merits of the application on the issues of the date of separation, his income for child support purposes, his contribution to section 7 expenses, custody of the children, spousal support and equalization of the parties’ net family properties.
[24] With respect to the first issue, I have already determined that Mr. Spears does not have an arguable defense on the date of separation, which I have found for the purposes of this motion to be May 9, 2019.
[25] With respect to his income for child support purposes, Mr. Spears submits that Ms. Dennis incorrectly identified, and Justice Laliberte incorrectly ordered, it to be $79,000 per year. As indicated above, Mr. Spears has never produced his 2018 or 2019 Income Tax Returns or Notices of Assessment. What he has produced are his 2017 Notice of Assessment, which notes a Line 150 income of $80,316 and his 2019 T4, which notes employment income of $69,366.89. Ms. Dennis’ evidence is that she identified $79,000 per year as Mr. Spears’ income as that was what she recollected it to be in the past. In this, she was correct, having reviewed Mr. Spears’ 2017 Notice of Assessment. Although neither she nor the court received information about Mr. Spears 2018 income, he has provided no explanation as to why his 2019 income was $10,000 lower than his 2017 income. Additionally, Ms. Dennis does not know if Mr. Spears employment income is his total income or whether he may have some investment income which should be included.
[26] Monthly child support for two children based on an annual income of $79,000 is $1,196 per month and is what Justice Laliberte ordered. Monthly child support for two children based on an annual income of $69,300 is $1,056 per month. The difference is $140 per month. Even if Mr. Spears had provided all the required disclosure to come to a proper determination of his CRA Line 150 income for the year 2019, which he has not, the difference is negligible. Additionally, the Divorce Order of July 22, 2020 contains a provision for annual adjustment of child support at paragraph 8 as follows:
- Commencing in May of 2020 and each year thereafter, the parties shall adjust the Table amount of child support and proportionate sharing of section 7 expenses to be paid in a calendar year based on the parties’ actual incomes from the preceding year. They shall provide one another with a copy of his/her income tax return, as filed, for the prior calendar year (the “applicable calendar year”) and their Notice of assessment. The parties shall then determine the appropriate Table amount of the parties’ child support obligation for the applicable calendar year, in accordance with the Child Support Guidelines and is shall be payable commencing June 1st.
[27] According to this provision, had Mr. Spears provided the appropriate documentation to Ms. Dennis, his child support payment could have been adjusted as of June 1st, 2020. Presumably, it may still be adjusted by the parties once Mr. Spears has provided the required documentation. This being the case, I do not find that Mr. Spears has set out facts that support the conclusion that there is an arguable defence on the issue of child support.
[28] Similarly, on the issue of Mr. Spears’ contribution to section 7 expenses, he submits that his arguable defence against paying the $164 per month ordered by Justice Laliberte is that there are no such expenses. Mr. Spears’ submits that the children do not attend daycare; rather they are cared for by Ms. Dennis’ parents, if required, and that the children did not attend camp this year. Ms. Dennis does not dispute this; rather she indicates that she estimated what the expenses would be as of September 2020, if the children were attending school and she returned to work full-time, which she had not done to the point of the order due to COVID-19. Ms. Dennis’ position in this regard is bolstered by the wording of the Divorce Order, which provides at paragraph 6:
- Provided the children are in school, commencing September 1, 2020, the Respondent shall pay to the Applicant as set monthly Order requiring the Respondent to pay to the Applicant a set monthly of [sic] $164.00 payment to cover the following regular and recurring section 7 expenses:
a) Child care for Savannah during the school year in the amount of $6,225.00
b) Child care for Raven during the school year in the amount of $6,225.00
c) Childcare/camp expenses for both children in the amount of $3,600.00 ($200.00 per week per child). (Emphasis added).
[29] Ms. Dennis also agrees that the children did not attend summer camp in 2020, again due to COVID-19, but they did so in 2019 and she deposes that she was projecting what the cost would be in the future, given that Mr. Spears had not participated and her order from the uncontested trial would be a final one upon which she would have to be reliant for the future. Ms. Dennis indicates in her material that because she ended up having to leave the matrimonial home, even though she had an order for exclusive possession, and move in with her parents, daycare has not been required. She is prepared to make an adjustment to the final order in this regard, but that this can be done on consent of the parties. Additionally, Mr. Spears’ contributions to section 7 expenses are subject to the same annual adjustment provision, as set out above, as is child support. For the same reasons, Mr. Spears has not made out an arguable defense on the issue of section 7 expenses.
[30] With regards to custody of the children, Mr. Spears submits that he is a caring and devoted father and was an equally involved parent to the children as was Ms. Dennis. It is his position that there should be a shared custody and shared parenting regime in place.
[31] The Divorce Order provides for Ms. Dennis to have primary residence and sole custody of the children, as well as sole authority to sign any legal documents and to travel with the children internationally without requiring Mr. Spears’ consent. Mr. Spears is to “have reasonable access with the children upon reasonable notice.” In her Affidavit for Uncontested Trial sworn on March 11, 2020, Ms. Dennis identified herself as the primary caregiver of the children since their respective births and indicated that she has “tended to all their emotional and physical needs with minimal support for the Respondent.” Ms. Dennis also indicated that after the birth of the children and until 2018, she only worked part-time outside of the home, while Mr. Spears was the main breadwinner for the family.
[32] Because Ms. Dennis obtained an order for the sale of the matrimonial home on July 22, 2020, she was also awarded exclusive possession of the home effective August 3, 2020, for the purpose of readying it for sale. Despite that Mr. Spears became aware of this on August 9, 2020, he did not vacate the home, as he was required to by the order of Justice Laliberte. Ms. Dennis claims that Mr. Spears persistently discussed adult issues with or in front of the children during the month of August. On September 3, 2020 Ms. Dennis left the matrimonial home with the children as she did not feel comfortable with them remaining around Mr. Spears due to an incident which occurred on that date. According to Ms. Dennis’ evidence, Mr. Spears “repeatedly” stated in front of the children that he was going to kill himself. Mr. Spears’ evidence is that this was misconstrued when he stated to Savannah: “what’s the point in living” if he is losing custody of the children. Ms. Dennis states that Mr. Spears then locked himself in a room with Raven and would not open the door. The police were called to the home twice on that date, and as a result, a referral was made to the CAS of Ottawa. The Society interviewed Ms. Dennis, Mr. Spears and the children privately and separately, and verified that “the children were put at risk of emotional harm from exposure to ongoing post separation caregiver conflict.” According to a letter from Child Protection Worker, Sherri Mackie, to the parents dated September 25, 2020, “The children disclosed feeling scared about both incidents.” The Society nevertheless made the decision to close the family’s file based on the facts that: 1) the parties were involved with Family Court; 2) the parents are living apart and access is being arranged through them; 3) this was the family’s first involvement with the Society and the incident was isolated; 4) the parents acknowledge the impact of adult conflict on the children; and 6) the children speak positively about both parents.
[33] On September 7, 2020, Ms. Dennis returned to the home to pick up some items for the children and found the locks to have been changed by Mr. Spears, this in the face of an order that she had exclusive possession of the home. Ms. Dennis had, in fact, to involve the Sheriff’s Office to enforce the order of Justice Laliberte, and on September 15th, 2020 a Notice to Vacate the premises by no later than September 23, 2020 was served on Mr. Spears. He finally vacated the home on September 22, 2020, almost two months after he was ordered by Justice Laliberte to do so.
[34] Ms. Dennis became quite concerned about these actions of Mr. Spears, finding them not to be in the best interests of the children. To her, they only reinforced that a sole custody order to her was the right one. Mr. Spears’ evidence is that he “calmly told” Ms. Dennis to await the decision on his motion requesting a determination of urgency, and she did not like it. Again, Mr. Spears appears to have done what he wished, as opposed to what was required of him. He ought to have complied with the order that had been granted while at the same time pursuing his quest to set it aside. He did not do that.
[35] Nevertheless, it is possible that Mr. Spears has set out facts that support the conclusion that there is at least an arguable defence made out the issue of custody/parenting time with the children. The question becomes to what degree either Mr. Spears or Ms. Dennis will be prejudiced if an order setting aside the noting in default and the Divorce Order is or is not made, which issue I will deal with below.
[36] With respect to the issue of Ms. Dennis’ entitlement (or lack thereof) to compensatory and non-compensatory spousal support, Mr. Spears has provided no evidence which would satisfy me that he has made out an arguable defense to that suggestion. Ms. Dennis took maternity leaves for both children. She only returned to full-time work sometime in 2018. In 2018, Ms. Dennis made an income of $22,572. In 2019, she made an income of $39,888. Ms. Dennis deposed that in much of 2020 she has been off work caring for the children due to the pandemic. She estimates her income to be approximately $20,000 to date in 2020 through a combination of employment income and CERB. Even in her best year, 2019, Ms. Dennis, made around half of Mr. Spears’ income. This is an eight-year marriage and 10 and ½ year relationship. Mr. Spears has provided no facts that would support that Ms. Dennis would not be entitled to spousal support on either a compensatory or non-compensatory basis. Additionally, the Divorce Order provides for only $1 per month to be paid in spousal support and includes a provision that “it may be changed if there is a material change in circumstances, even if the change was foreseen or foreseeable.” Hence, Mr. Spears will always have the option to make arguments on the appropriate quantum and duration of spousal support upon a material change occurring.
[37] Finally, with respect to the equalization payment and the transferable amount of Mr. Spears pension, I have received no evidence from Mr. Spears that would suggest that outcomes would be different on those issues if fully litigated. On the equalization, Mr. Spears alleges that Ms. Dennis only included one half of the value of a bank account she holds jointly with her mother, rather than the full amount. If, however, the account is jointly held, as is evinced by Exhibit “E” to Ms. Dennis’ affidavit of October 6, 2020, then it is appropriate that she has included one half of the balance as of the date of separation on her net family property statement. Additionally, if Mr. Spears is a pension holder, which as an employee of Canada Post he is, pursuant to the Family Law Act, Ms. Dennis will be entitled to one half of the Family Law Value of the pension from April 23, 2011 to May 9, 2019. Mr. Spears has never provided evidence of the value of his net family property, nor has he presented any facts which would suggest that Ms. Dennis would not be entitled to one half of the Family Law Value of his pension. Hence, I find that he has no made out an arguable defence on the issues of equalization of the division of his pension.
Criteria d.
Potential Prejudice to Mr. Spears
[38] Mr. Spears submits that the prejudice to him if the default order is not set aside includes:
a. Paying child support at a table amount based on an income that is $10,000 more than what he makes;
b. Being required to pay for non-existent section 7 expenses;
c. Having his income garnished by the Family Responsibility Office (“FRO”) pursuant to the Divorce Order, including enforcement of $2,250 in costs enforceable as support;
d. Going from being an active participant in the children’s lives to essentially being shut out;
e. Having no ability to have the children’s voices heard through a request for involvement of the Office of the Children’s Lawyer;
f. Having no input regarding the sale of the matrimonial home; and,
g. Having no input into the numbers presented for equalization and post-separation expenses related to the matrimonial home.
[39] Based on my reasons and findings already made above, I find that there is little to no prejudice to Mr. Spears regarding child support, section 7 contributions, enforcement by FRO and equalization of the parties’ net family properties.
[40] I do find that there is some potential prejudice to Mr. Spears in relation to the issues of custody of and parenting time with the children if the order is not set aside. This is particularly so considering Section 16(10) of the Divorce Act, which provides that the court is to give effect to the principle that a child of the marriage should have as much contact with each spouse as is consistent with the best interests of the child. Having said that, Mr. Spears has provided little in the way of evidence that would assist the court in coming to the determination that the children’s best interests would be served by some order other than that made on July 22, 2020. Although access by Mr. Spears to the children is not specified in that order, in response to his suggestion of a shared parenting schedule, Ms. Dennis has proposed that he have the children every second weekend from Friday after school to Sunday evening. This, as well as his daily telephone calls with the children which he describes in paragraph 100 of his affidavit of October 5, 2020, would, of course, reduce the risk of Mr. Spears being “shut out” of the children’s lives.
[41] The parties have since the commencement of this motion agreed that the matrimonial home will be sold, as is evinced by my endorsement of October 14, 2020 on Mr. Spears adjournment request. The parties have also agreed upon a minimum listing price, and Ms. Dennis, who is currently empowered by the order to solely list the home and execute any offer for purchase and sale, attests to the fact that she will take the best possible price offered, which is in both her own and Mr. Spears’ interests. The final order, moreover, provides for the proceeds of the sale to be divided equally between the parties (after some adjustments and the equalization payment are accounted for). On this basis, I do not find that Mr. Spears would be prejudiced by the order not being set aside on the grounds that he has no say in the sale of the matrimonial home.
[42] The Divorce Order of Justice Laliberte provides that both parties are to pay expenses for gas, electricity, water/sewer, mortgage and property tax on the matrimonial home equally until it is sold. Mr. Spears submits that is will be prejudiced by this if the order is not set aside. Both parties have presented “numbers” regarding the payment of expenses relating to the matrimonial home. Mr. Spears states that Ms. Dennis has never paid the mortgage or property taxes on the home. Ms. Dennis does not dispute that but indicates that she has historically paid for other expenses relating to the home such as groceries, home phone, cable and internet, electricity, water and gas, while Mr. Spears has paid the mortgage, home insurance and property taxes. According to her evidence, the house expenses she paid have amounted to approximately $1,150 per month while those Mr. Spears has paid have amounted to $1,281 per month, or roughly equal amounts. Mr. Spears has not countered that evidence. In these circumstances, I cannot see how Mr. Spears would be prejudiced by an order that requires him to continue to be responsible for one half of the expenses relating to the matrimonial home, as he has always been, pending its sale.
Potential Prejudice to Ms. Dennis
[43] Ms. Dennis submits that she would be prejudiced by the default order being set aside by having to essentially commence her litigation all over again, even though she did everything she was supposed to do in the first instance. She submits that she would be prejudiced by not being in receipt of the support to which the children are entitled or the equalization payment and pension division to which she is entitled, and the children would be prejudiced by not having the security of a final order regarding the parenting issues.
[44] Ms. Dennis’ position is that the prejudice to her, after having undertaken the expense of preparing for and attending at the uncontested trial, outweighs any prejudice there may be to Mr. Spears of leaving the order in place. She submits that based on Mr. Spears evidence in this motion, little would change in terms of final outcome if the process was commenced all over again.
[45] Ms. Dennis submits, moreover, that if there is any prejudice to Mr. Spears, it is of his own making as a result of his own choice not to participate in the proceedings.
[46] Finally, Ms. Dennis submits any prejudice which the court may find exists with respect to the issues of custody and access can properly be addressed by way of a Motion to Change by Mr. Spears. With this, I agree.
Criteria e.
[47] Mr. Spears relies upon Rule 2 of the Family Law Rules to support his position that the default order needs to be set aside. Ms. Dennis also relies upon it to support that it should not. Rule 2 provides:
Rule 2: INTERPRETATION
PRIMARY OBJECTIVE
(2) The primary objective of these rules is to enable the court to deal with cases justly. O. Reg. 114/99, r. 2(2).
DEALING WITH CASES JUSTLY
(3) Dealing with cases justly includes,
(a) ensuring that the procedure is fair to all parties;
(b) saving expense and time;
(c) dealing with the case in ways that are appropriate to its importance and complexity;
(d) giving appropriate court resources to the case while taking account of the need to give resources to other cases. O. Reg 114/99, r. 2(3).
[48] Mr. Spears is of the view that not setting aside the order of Justice Laliberte would not be dealing with the case justly. Mr. Spears relies on the cases of Naseem v. Saddiqui, 2018 ONCJ 141, Lin v. Ha, supra, Chambers v. Johnson, 2002 CanLII 61138, Schryver v. Schryver and Johal v. Sangha, 2016 ONSC 6791 in support of his position.
[49] In Naseem, Justice Spence denied the father’s motion to set aside a default judgment based on his lack of defence in his pleadings. In so doing, however, Justice Spence stated at paragraph 33:
[33] Courts almost always prefer to decide cases on the merits rather than on a default basis. And because of that, in a motion such as this, reasonable latitude should be afforded to the moving party, in an effort to decide the case on the merits, and thereby do justice to the parties.
[50] Notwithstanding his deference to latitude, Justice Spence found that the father had “fallen far short of persuading the court that the interests of justice require the court to set aside the default order”. Justice Spence found this on the basis that the father did not have a reasonable excuse or explanation for his failure to comply with the Family Law Rules and because the father had recourse to a remedy by seeking an order for specified access by application pursuant to the Children’s Law Reform Act. In this case, I have found that Mr. Spears has not provided a plausible excuse or explanation for his default in complying with the Rules, and have also found that the remedy of a Motion to Change is available to him on the parenting issues.
[51] In Lin v. Ha, Justice Kristjanson stated at paragraph 48: “the very basis of a motion to set aside a default proceeding is that it is in the interests of justice, in that a party did not have notice of proceedings or has offered a reasonable explanation for non-participation, and has established a plausible defence.” In this case, I have found that Mr. Spears has not offered a reasonable explanation for non-participation, nor has he established a plausible defence on the issues.
[52] In Chambers, Justice Little noted at paragraph 5:
I acknowledge the fundamental principle that the court must act fairly and be seen to act fairly between the parties and to determine the best interests of the child. In such a case as this, the best interest of the child are better met by a hearing on the merits with evidence tendered by both parties…Any potential prejudice to the applicant can be addressed by a consideration of retroactivity of the orders for child support and spousal support.
[53] This was, however, after Justice Little indicated that he or she was “satisfied on the basis of the evidence that the respondent had made an inadvertent series of errors” which led to his non-participation. In this case, I have made no such finding. I agree that the best interests of children are better met by having a hearing on the merits with evidence tendered by both parties. That is why the Rules of Family Law exist and what they are intended to achieve. If a party fails to comply with them, the Rules themselves provide for the path to uncontested trial, and it cannot be seen to be unfair to uphold a decision resulting from that path being followed.
[54] In Schryver, Justice Murray found at paragraph 37 that it would be a denial of natural justice and of basic fairness to the respondent to not set aside the order. However, this is a case where the respondent had been participating in the court proceedings for three years, but failed to file an Answer to an Application which was, in essence, rectifying an earlier misstep by the applicant. The court found as a fact at paragraph 31 that “the respondent did not appreciate that a new process had been started which required an answer in order to protect his right to participate”. In this case, Mr. Spears knew he had to file an answer to participate. He did not do so, and as I have indicated earlier, he attempted to lay the blame for that at the feet of Ms. Dennis.
[55] In Johal, the Court found at paragraph 17 that it was possible “that the Respondent convinced himself that reconciliation would take place, and that he need not defend the Application”. However, this was after the Court reviewed transcripts of taped conversations between the parties that evinced reconciliation had been at some point discussed. In Johal, Justice Bloom notes in paragraph 13 that the Respondent alleged that “he was prevented by the Applicant from …[filing an answer] by an intentional and well planned fraudulent misrepresentation…” Justice Bloom noted in paragraph 14: “An allegation of fraud is a serious one…” and in concluding as he or she did in paragraph 17, was careful to say that “the Applicant did not defraud him into that belief.” In this case, Mr. Spears has alleged that he was “manipulated and induced by error by the Applicant to not participate in the divorce proceedings”. This too is a serious allegation, and one which requires concrete evidence to prove. Mr. Spears has provided no such evidence. Rather, the evidence before me shows that Mr. Spears did not provide financial disclosure to Ms. Dennis pursuant to her request in May of 2019, did not provide financial disclosure to her in response to her Application for Divorce, did not file his own Answer and Financial Statement[^1], did not attend the Case Conference, did not contact Ms. Fenton and did not comply with the order of Justice Laliberte with respect to exclusive possession of the matrimonial home to Ms. Dennis. Mr. Spears cannot now simply seek to shift the blame for his lack of action or adherence to the Rules and Divorce Order onto Ms. Dennis.
[56] For all of the above reasons, the Respondent’s motion is dismissed.
Costs
[57] If the parties are unable to agree on liability and quantum of costs for the motion by November 15, 2020, written submissions of no more than three double-spaced, type-written pages, along with Offers to Settle and bills of costs may be submitted to me at 10-day intervals and I shall make an order.
Justice Engelking
Date: October 28, 2020
SCHEDULE “A”
[1] On July 22, 2020, the Honourable Justice Laliberte signed the Final Divorce Order. In it, the Court ordered as follows:
Custody
The Applicant mother, Suzanne Clydeth Dennis, shall have primary residence and sole custody of the children of the relationship, namely, Savannah Trinity Spears, born January 4, 2009 (“Savannah”) and Raven Victoria Spears, September 24, 2013 (“Raven”)(collectively, the “children”).
The Applicant shall have the sole authority to sign any legal documents pertaining to the children, including but not limited to medical or dental directions or consents, school registration, passport applications or renewals, third party consents, etc.
The Applicant shall be permitted to travel internationally with the children without the written consent of the Respondent Father and she shall have the sole authority to sign travel consents for all international travel relating to the children.
The Respondent shall have reasonable access with the children upon reasonable notice.
Child Support
Commencing on August 1, 2020, the Respondent father, Nicholas William Spears, shall pay to the Applicant child support for two children in the amount of $1,196.00 per month based on an estimated income of $79,000.00.
Provided the children are in school, commencing September 1, 2020, the Respondent shall pay to the Applicant a set monthly Order requiring the Respondent to pay to the Applicant a set monthly of $164.00 payment to cover the following regular and recurring section 7 expenses:
a) Child care for Savannah during the school year in the amount of $6,225.00
b) Child care for Raven during the school year in the amount of $6,225.00
c) Childcare/Camp expenses for both children in the amount of $3,600.00 ($200.00 per week per child).
In addition to the expenses above, the Respondent shall pay to the Applicant his proportionate share of the children’s section 7 expenses which are not set out above, which shall include any medical or dental expenses for the children not covered by insurance.
Commencing in May 2020 and each year thereafter, the parties shall adjust the Table amount of child support and proportionate sharing of section 7 expenses to be paid in a calendar year based on the parties’ actual incomes from the preceding year. They shall provide one another with a copy of his/her income tax return, as filed, for the prior calendar year (the “applicable calendar year”) and their Notice of Assessment. The parties shall then determine the appropriate Table amount of the parties’ child support obligation for the applicable calendar year, in accordance with the Child Support Guidelines and it shall be payable commencing June 1st.
The Respondent shall maintain a life insurance on his life in the amount of $200,000.00 to secure his child support obligations and to maintain the Applicant as irrevocable beneficiary in trust for the children. If the life insurance policy or policies are not in force when the Respondent dies, then the Respondent's obligation to pay support shall survive his death and shall be a first charge on the Respondent's estate.
Health Coverage
If available through his employment, the Respondent shall maintain the children on his medical, extended health and dental coverage for as long as it is available to him for the children’s benefit.
The Respondent shall provide the Applicant with all information necessary for the service provider to submit claims electronically to the insurer. This information shall include, but not be exclusive to, the name of the insurance provider and any policy/group number.
If possible, a separate account shall be created for Savannah and Raven, which would allow the Applicant to submit claims and be reimbursed directly for expenses paid by her on the behalf of the children, including the ability to log in and submit claims electronically (provided that an account only for Savannah and Raven can be created which limits the information only to the children and not the Respondent or his other beneficiaries).
Whenever possible, and in the event that they cannot submit claims directly as set out above, the parties shall:
a) cooperate to ensure maximum coverage of expenses;
b) promptly submit receipts given to them by the other to the insurer; and
c) immediately endorse the reimbursement cheques from the insurer to the party who originally incurred the expense and deliver them to them.
All medical expenses for the child not covered by either party’s extended health insurance and which exceed $100.00 annually, are special or extraordinary expenses and shall be paid according to the applicable special or extraordinary expense sections above.
Within 30 days of the of the effective date of this Order, the Respondent shall provide:
a) proof of his life insurance policy, including the amount and designated beneficiaries; and
b) the medical coverage information set out above.
Spousal Support
The Applicant is entitled to spousal support on a compensatory and non-compensatory basis.
The Respondent shall be required to pay to the Applicant spousal support of $1.00 per year.
Spousal support may be changed if there is a material change in circumstances, even if the change was foreseen or foreseeable.
Sale of the Matrimonial Home
The jointly owned home located at 14 Eagleview Street, Kanata, ON, K2M 2R2, shall immediately be listed for sale with a real estate agent of the Applicant’s choice.
Within two weeks, the Respondent shall vacate the matrimonial home so that the Applicant may prepare the home for listing.
In the event that the Respondent does not vacate the home as required, a Writ of Possession shall issue permitting the Sheriff to remove him from the premises.
The Applicant shall have exclusive possession of the jointly owned home until its sale. Both parties shall continue to pay the following expenses for the home equally until the closing date of the sale of the home:
a) Gas: $100.00
b) Electricity: $100.00
c) Water/Sewer: $90
d) Mortgage: $ 1,034.16
e) Property Tax: $247.28
- The Applicant shall have the sole signing authority to sign any documents relating to the sale, including the following:
a) the listing agreement, including the listing price;
b) offers to purchase received;
c) agreements for purchase and sale.
The Applicant shall be permitted to retain a lawyer of her choice to deal with the sale.
The following expenses be paid from the matrimonial home sale proceeds:
a) Real estate commission, if any;
b) Adjustment for taxes, utilities, municipal fees or levies;
c) Amount required to discharge encumbrances;
d) Legal fees and disbursement relating to the sale;
e) All other sale adjustments.
There is an equalization payment owing from the Respondent to the Applicant in the amount of $3,998.22. This payment is taken into account in paragraph 26 below.
The remaining net proceeds of sale shall be shared by the parties equally, subject to the Applicant receiving the following amounts from the Respondent’s 50% of the net proceeds:
a) The equalization payment of $3,998.22;
b) Any amounts paid the Applicant on the Respondent’s behalf for the expenses set out at paragraph 21 above;
c) Costs of $2,250.00, which represents the costs awarded minus amounts to be enforced through FRO per paragraph 37 below.
Pension Division
The maximum transferrable amount shall be transferred from the Respondent Husband’s Canada Post pension (herein after referred to as the Plan) to the Applicant Wife’s pension or registered savings. In order to do so, the Respondent Husband’s pension must be valued with a Family Law Value Report.
The Applicant Wife shall submit the Application for Family Law Value. The Application will be based on the following facts:
a) The Respondent Husband is a member of the Plan;
b) The Respondent Husband was born on August 31, 1978;
c) The Applicant Wife was born on January 4, 1981;
d) The starting date is April 23, 2011, which is the parties' date of marriage;
e) The Family Law Valuation Date is May 9, 2019, which is the date of separation of the parties, for the purpose of their pension valuation; and
f) No payment of an instalment of the Respondent Husband's pension benefits was due on or before the Family Law Valuation Date.
The maximum transferrable amount of the Family Law Value of the Respondent Husband's pension interests that may be assigned and transferred to the Applicant Wife from the Plan shall be determined by the Family Law Value Report.
The maximum transferrable amount of the Family Law Value of the Respondent Husband's pension interests, plus interest/investment earnings from the Family Law Valuation Date of May 9, 2019, to the beginning of the month in which the transfer is made, shall be transferred to the Applicant Wife in a lump sum (the "Lump Sum Transfer") as set out in this section.
The Plan Administrator will make the Lump Sum Transfer to the Applicant Wife's RPP or LIRA, the details of which shall be provided by the Applicant Wife.
Within 10 days of receipt of the FSCO Form 4B Statement of Family Law Value from the Plan Administrator, the Applicant Wife will complete and file with the Plan Administrator, a Pension Form 5 (Application to Transfer the Family Law Value), to effect the Lump Sum Transfer.
The Respondent Husband shall not do anything to cause his pension to cease to be available for division in accordance with this Order. In the event that the Respondent Husband does jeopardize the availability of his pension for division in accordance with this Order, the Applicant Wife’s right to seek a sanction or remedy are preserved.
If the Applicant Wife dies before the Respondent Husband and before the Lump Sum Transfer under the PBA is completed, the Lump Sum Transfer will be paid to the Applicant Wife's estate.
The Lump Sum Transfer shall be in before-tax dollars.
Once the provisions relating to the matrimonial home and the pension transfer have been completed, all property issues between the parties are settled in full and final satisfaction of all claims under Part I of the Family Law Act.
The Respondent shall pay costs to the Applicant in the sum of $4,500.00, which shall be payable within 30 days, 50% of which ($2,250.00) shall be designated in pursuit of support and shall be enforced by the Family Responsibility Office.
Unless this Order is withdrawn from the office of the Director of the Family Responsibility Office, it shall be enforced by the Director and the amounts owing under this order shall be paid to the Director, who shall pay them to the person to whom they are owed.
The Order bears post-judgment interest at the rate of 2% per annum effective from the date of this Order. Where there is default in payment, the payment in default shall bear interest only from the date of default.
COURT FILE NO.: FC-19-2545
DATE: 2020/10/28
ONTARIO
SUPERIOR COURT OF JUSTICE
RE: Suzanne Clydeth Dennis, Applicant
AND
Nicholas William Spears, Respondent
BEFORE: Justice Engelking
COUNSEL: J. Nevada Fenton, for the Applicant
Jillian Allen, for the Respondent
ENDORSEMENT
Engelking J.
Released: October 28, 2020
[^1]: Mr. Spears appended a draft Answer, Financial Statement and Affidavit in Support of Claim for Custody or Access to his Factum, but I did not review them as they are not properly before the court.