NEWMARKET COURT FILE NO.: FC-13-42559-00

DATE: 20210112

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

C.Z.

Applicant

– AND –

J.Y.

Respondent

K. Maurina and S. Kirby, Agents (2020) at the trial for the Applicant

P. Pelman, Counsel (2019) at the trial for the Applicant

Self-represented

HEARD: December 8 and 9, 2020 (with transcript evidence dated June 11, 12, 13 and 14, 2019)

REASONS FOR DECISION

A. Himel J.

I. INTRODUCTION

[1] The applicant (the “wife”) and the respondent (the “husband”) married on September 20, 1995 and separated on December 30, 2011. There are two children of the marriage, CZ (age 17.5) and DY (age 15.5). In accordance with the final Consent Order of Kaufman J. dated April 9, 2018 and corrected by the Order of Douglas J. dated September 10, 2018, the wife has sole custody and primary residence of the children.

[2] The issues before the Court are as follows: (1) property claims (including the equalization of net family property, unequal division, trust claims, notional disposition costs and post-separation adjustments); (2) retroactive and ongoing spousal support and child support (including imputing incomes to each of the parties), and section 7 expenses.

[3] This matter proceeded as a re-hearing. The reasons for decision (the “Reasons”) are derived from transcript evidence that flowed from the initial four-day hearing in June 2019 (the “Original Trial”) and oral evidence from a further two-day hearing in December 2020 (the “Updating Trial”).

II. BACKGROUND FACTS AND LITIGATION HISTORY

[4] The facts as I find them are set out below and will provide context for the analysis. Further facts will be referred to in the analysis as required. Where evidence of significance differs, it will be identified and considered.

[5] At the time of separation the wife was employed at HSBC as a credit risk systems analyst. The husband was employed at ST Micro Electronics as an electrical engineer. The husband also spent time as an active investor whose portfolio had a value of approximately $1,476,307 on the date of separation (and the wife had investments valued at $200,421).

[6] While the parties initially continued to use the joint TD Bank Account, this arrangement ceased in July 2012. The husband voluntarily began paying child support in the monthly amount of $2,525.

[7] The wife was represented by counsel (TM) and an Application was issued on February 1, 2013. The husband was also represented by counsel (PM).

[8] Commencing May 1, 2013, and pursuant to the Consent Order of Kaufman J. dated May 3, 2013 (the “Kaufman J. May 2013 Order”) the husband paid temporary, without prejudice, child support in the amount of $2,525 per month. There are no arrears. To date, spousal support has not been paid.

[9] The parties negotiated an agreement in September 2013 (the “2013 Agreement”). It provides that the wife buy-out the husband’s 50% interest in 128 Fitzgerald Avenue, at the separation date value ($900,000). The 2013 Agreement also states that all investments and other assets are shared equally using valuation date amounts. The house was transferred to the wife. She made a payment ($238,000) and assumed liability for the husband’s one-half interest in the mortgage ($211,919). The investments and other assets were never equalized.

[10] The wife furnished the basement and now has an income-producing unit (the “Basement Apartment”). The most recent tenants paid monthly rent of $1,300.

[11] The husband was laid off of his position as staff engineer following the company’s closure in October 2013. After failing to secure a replacement employment position the husband turned his attention to the growth of his investments.

[12] The husband invested funds from his severance pay, and employment insurance (of approximately $100,000) into his investments (which include stock margin accounts, RRSPs, TFSAs and mutual funds). Otherwise, there has been no new injection of capital since separation into any of the many (currently 17) investment accounts held by the husband.

[13] In early 2015, the husband retained new counsel (LB).

[14] On October 19, 2015, the wife and the maternal grandmother purchased a property municipally known as 105 Carlton Road (Unit 40), Markham (the “Carlton Townhouse”) for the sum of $521,290. They hold the property as joint tenants and the unit rents for $1,900 per month. The wife failed to disclose this asset on her 2016 financial statement.

[15] As noted in the Endorsement of Douglas J. dated August 5, 2016, there was no activity on this file for over two years. At that attendance the wife was represented by her second lawyer (KL). He ordered the parties to exchange Requests for Information within 15 with responses due within 30 days thereafter. Disclosure continued to be an issue at the subsequent Settlement Conference held on August 18, 2017. On that date Douglas J. ordered the parties to execute authorizations/directions to enable the other party to obtain access to third party records.

[16] The husband brought a disclosure motion returnable on December 16, 2016. The wife obtained an adjournment by relying on a forged note from North York Hospital. The note claimed that she needed to take the maternal grandmother to hospital for an eye operation. In January 2016, she filed another forged doctor’s note (from Dr. MW). She describes the forgeries as a “mistake” that she attributes to being self-represented and very scared of the disclosure motion. The motion ultimately proceeded on January 18, 2017.

[17] The parties attended a Trial Scheduling Conference on November 17, 2017, and the wife was assisted by new counsel (EM), who appeared as agent. The wife was granted leave to serve an Amended Application.

[18] Pursuant to the Amended Application the wife made new claims for resulting trust, constructive trust, unjust enrichment, joint family venture and an unequal division of net family property. The wife’s claims are founded on the argument that the husband’s investments, though held in his name alone, are properly joint property as the seed money was derived from joint assets and joint debts. From that day forward the wife has pursued a 50% interest in an asset she refers to as the “Family Investment Portfolio,” or, in the alternative, an unequal division of net family property.

[19] Unbeknownst to the husband, at some time in 2016 or 2017 two pre-construction condominium units (the “Toronto Condos”) were purchased by 2659477 Ontario Inc. (that lists the wife as the secretary and treasurer) and whose sole shareholder is the maternal grandmother. The wife is listed (but has no personal liability) as one of the guarantors and her name is on both mortgages with TD Bank. Unit 1306 is currently tenanted, and Unit 1506 is available for rent at a rate of $2,050 per month.

[20] The wife admits that the maternal grandmother swore an affidavit on January 13, 2017 stating that she is dependent on her daughter for support. The maternal grandmother has a limited income (derived solely from government benefits).

[21] At various times there have been tenants residing in the Basement Apartment and Carlton Townhouse.

[22] In June 2018, the husband paid the wife the sum of $133,439, which is the amount he believes was payable to equalize the parties’ net family property.

[23] In September 2018, the wife lost her job earning $85,000. For seven months she was paid severance and employment insurance in the total amount of $69,421. To date, she has not found a replacement employment position.

[24] During one school year an international student resided with the wife.

[25] In early 2019, the husband became a self-represented litigant.

[26] A four-day trial took place before Mullins J. in June 2019. The wife was represented by counsel (PP) of the same firm as (EM).

[27] Shortly after its conclusion the wife brought a successful motion to re-open the trial and additional documentary evidence was filed. Closing submissions were submitted in August 2019.

[28] On March 5, 2020, Regional Senior Justice Fuerst declared the Original Trial Judgment, and the subsequent costs decision, a nullity. The Judgment was rendered on November 25, 2019, which is beyond the time limitation imposed on a retiring judge. This decision was made pursuant to section 123 of the Courts of Justice Act.[^1] The Court ordered that the re-hearing be presided over by a judge who has not read the decision or had any involvement in the case.

[29] The matter was scheduled for a re-hearing in May 2020, which was delayed because of the impact of the Covid-19 pandemic on the Court.

[30] The parties were unable to settle the dispute at court conferences held in April and November 2020. Consequently, a further two-day trial was held on December 8 and 9, 2020, to provide the parties with the opportunity to provide testimony from June 2019 onwards (and to tender evidence on two specific matters as agreed to by the parties). The transcripts from the Original Trial formed the basis for the remainder of the evidence.

III. PRELIMINARY CONCLUSIONS

[31] This case is best characterized as one of fundamental contradictions. Each party alleges a failure of the opposite party to provide full financial disclosure, being inappropriately and intentionally under-employed, having an income below what is reasonable, and inappropriately minimizing his/her income for tax purposes. Each party maintains that the (relatively low) income attributable to himself/herself is reasonable.

[32] Each party requests that the other be held to admissions made on earlier dates that contradict the positions taken at trial. Each party argues that his/her changes of positions are “mistakes” that are now “corrected.” This litigation has been ongoing for over seven years and the wife has had five different lawyers providing representation/assistance at various times (not including KM’s co-counsel SK). The husband was previously represented by two different lawyers and has been self-represented since early 2019. Therefore, it is not surprising that each party’s position on certain factual and/or the legal issues has changed. In any event, as none of the material facts or findings are based on any of the alleged admissions or corrected mistakes, it is unnecessary to address this distinction.

[33] A polite way to respond to the parties’ contradictory positions is as follows: “you can’t have it both ways.” Each party repeatedly requests the Court to draw adverse inferences and findings against the other that seemingly should not apply to his/her situation. For the most part I decline to do so.

[34] With respect to the property claims, if some or all of the wife’s Family Investment Portfolio arguments are successful then the equalization calculation dramatically changes. The husband’s investments have continued to increase substantially since separation. The investments had an approximate value of $1,476,308 at the date of separation, $3,470,679 at the Original Trial and $4,320,214 today.

[35] The wife’s 2017 added claims (resulting trust, constructive trust, unjust enrichment and joint family venture) as well as the request for an unequal division of net family property are forms of relief that are distinct from those sought in the original Application. In 2013, the wife sought an equalization of net family property, an accounting of the investments controlled by the husband and a retroactive adjustment for the amounts she paid by post-separation on account of the mortgages.

[36] While the parties initially intended to call third party witnesses at the Original Trial, they ultimately declined to do so. Moreover, neither party produced any expert reports respecting employability, calculating and imputing income for support purposes, the valuation of either party’s investments including notional disposition costs, or real estate appraisals for the real property. In other words, the evidentiary record is founded solely on the testimony provided by the husband and wife and the documentary evidence tendered by each of them.

[37] The parties’ written submissions are inflammatory, lengthy and improper (as alleged by one against the other). The arguments conform, in part, with my direction that each party identify the evidentiary basis (in the 2019 transcripts) to support his/her arguments. The wife’s submissions include some (but not all) references, and the husband relies (in part) on statements made and documents tendered at earlier court attendances rather than at the trial. While I did not preside over the Original Trial, I have pieced together the relevant evidence from 2019 and 2020, and I have considered the parties’ respective arguments for the formation of the Reasons.

[38] This case is also marked by allegations of poor credibility and reliability. Each party makes these accusations in the context of financial disclosure and misleading behaviour. Jarvis J. summarizes the relevant considerations when assessing credibility and reliability as follows:[^2]

[28] As has been frequently observed, the assessment of witness credibility is an inexact science, impossible to articulate with precision. For example, a witness may impress the court with the coherence and logic, or common sense, of their narrative but be unreliable due to their interest in the outcome of the case or the lack of probative information. Or a witness may be so interested in a case that they are incapable of making an admission or facilitating the disclosure of information that they perceive as helpful to the other party and harmful to their case. These affect the weight to be given to that evidence. There is, quite simply, no one-size-fits-all template. Several of the many considerations relevant to the weighing and assessment of witness credibility and reliability, and relevant to his case, were comprehensively reviewed in Al-Sajee by Chappel J. who aptly observed that,

…the judge is not required by law to believe or disbelieve a witness’s testimony in its entirety. On the contrary, they may accept none, part or all of a witness’s evidence, and may also attach different weight to different parts of a witness’s evidence (see R. v. D.R., 1996 207 (SCC), [1996] 2 S.C.R. 291 (S.C.C.), at paragraph 93; R. v. J.H., 2005 253 (ON CA), [2005] O.J. No. 39 (Ont. C.A.) at paragraphs 51-56; McIntyre v. Veinot, 2016 NSSC 8 (S.C.), at para. 22).[^14]

[39] I find the husband to be credible and reliable in his testimony. He admitted to omitting the sum of approximately $26,000 (US) in his October 2020 financial statement. The husband coherently explained how he calculated his income and the amounts attributable to his assets as well as notional disposition costs. The husband has a keen memory and a clear paper trail to support his position.

[40] In contrast, I have serious concerns about the wife’s credibility. There are various examples in the transcripts where the wife cannot remember/does not know the answer or is unresponsive to the question. Absent documentary evidence put to the wife during cross-examination, she declined to make admissions. The wife was not forthcoming and often misrepresented material facts.

[41] Some examples of the wife’s concerning actions include: (1) admitting (for the first time) at the Original Trial that she had forged the hospital note and the doctor’s note to delay the husband’s disclosure motion; (2) failing to disclose that CZ moved out of the wife’s home on or about summer 2020, and making a claim for ongoing child support and section 7 expenses for that child; (3) minimizing the increase in value of the matrimonial home and Carlton Townhouse by tendering real estate listings that fail to include the sold prices (which were dramatically higher). The wife also omitted to include properties that were more comparable (in terms of location and property taxes) than the ones she relied upon; (4) failing to include any ownership interest in the Carlton Townhouse in her April 2019 financial statement. She now claims a 50% interest as per the October 2020 financial statement and an 80% interest in her 2019 Income Tax Return (“ITR”); (5) claiming that she earns nominal rental income on the Basement Apartment and Carlton Townhome on account of the significant expenses (as claimed in her 2019 ITR); (6) failing to disclose the two Toronto Condos; and (7) providing unreliable evidence (without documentary support) in respect of a $40,000 (US) loan to her sister, as well as the significant bank deposits and a pre-construction unit down-payment (which she attributes to her friend “Helen”).

[42] All of the above examples and others referred to below came to light only because of the husband’s diligent preparation for trial and his ability to find and present the necessary evidence to effectively attack the wife’s credibility and reliability.

[43] With respect to spousal support and a retroactive adjustment of child support, the wife’s late-date decision to seek a commencement date of September 1, 2016, creates challenges in the assessment of her income. By letter dated April 30, 2019, the wife refuses to produce any financial disclosure that pre-dates 2016 (notwithstanding prior disclosure Orders). At trial she opted to file nominal documentation in respect of her 2012 to 2015 income. Only short excepts from the wife’s 2016 – 2018 ITRs were filed with the Court. The limited evidence before the Court makes it difficult to determine an appropriate income for support purposes.

[44] For these reasons where the parties engage in a “he said/she said” dispute (without reliable corroborating evidence) I prefer the husband’s evidence to that presented by the wife.

IV. THE PROPERTY ISSUES

Are the Property Claims Properly Disposed of by Way of Equalization, Trust Claims, Unjust Enrichment or the 2013 Agreement?

[45] The most significant issue in dispute relates to the considerable increase in the value of the husband’s investments since separation. The wife submits that during the marriage the parties borrowed money to aggressively invest in stocks and mutual funds. It is unlikely that the wife would have pursued trust claims or unjust enrichment if the investments had remained stagnant or if they had fallen in value (on account of changing market conditions, poor investment decisions, bad luck or otherwise).

The Parties’ Positions in Respect of the Property Claims

[46] The wife claims a 50% interest in the current value of the husband’s investments by way of resulting trust. The relevant arguments for consideration are as follows:

(a) the investments that existed on the date of separation and which exist today (in the same or different accounts) were funded by joint loans taken during the marriage (and serviced by joint funds). In September 2011, two TD Bank mortgages (that were secured against the matrimonial home) were taken out in the collective amount of $450,000 (the “Two Mortgages”);

(b) the borrowed funds were deposited into one of the husband’s investment accounts. The accounts were held in his name alone for tax planning purposes;

(c) both before and after the transfer of the matrimonial home to the wife’s name alone, she was solely responsible for servicing the Two Mortgages and, as such, the payments are her direct contributions to the husband’s investment accounts;

(d) the husband never injected additional funds into the investment accounts (other severance/employment insurance benefits that he received in 2013 and 2014); and

(e) there is no evidence the wife intended that her 50% interest in the funds (yielded from the Two Mortgages) be treated as a gift, nor were any real or existing creditors defeated by the advances to the husband.

[47] The wife argues that if her resulting trust claim is denied, the circumstances support a finding of unjust enrichment and warrant an unequal division of net family property on the basis of unconscionability.

[48] While the wife wants to share in the post-valuation date increases in the husband’s investments, she denies that the current value of her assets should be shared as the husband has failed to make such a claim.

[49] With respect to the 2013 Agreement, the wife maintains that she had no independent legal advice respecting same, nor did the 2013 Agreement contemplate any bar to trust claims.

[50] The husband argues that the property claims should be resolved in accordance with the principles of the equalization of net family property for the following reasons:

(a) the parties entered into the 2013 Agreement which provided for a resolution of all property issues. The agreement included a transfer of the matrimonial home from joint names to the wife’s name alone at the separation date value ($900,000) rather than the increased market value (which he estimates at $1,200,000);

(b) the wife’s obligation to assume the husband’s 50% liability for the mortgages was part of the buy-out amount ($238,000 + $211,919 = $450,919) owed to him on account of the transfer. Any expenses incurred by the wife after he vacated the matrimonial home are properly addressed through occupation rent/carrying costs - arguments which the parties abandoned prior to the Original Trial. Given the increased value in the matrimonial home, the wife was more than compensated for any liabilities attributable to the husband;

(c) Ontario’s equalization of net family property regime equalizes all forms of assets and debts at the date of separation. There is no basis to deviate from same, nor any evidence that the parties intended to be partners in any joint family venture after separation;

(d) the parties each held investment portfolios in their respective names, and they have each acquired valuable assets post-separation;

(e) the increase in the value of the husband’s accounts are derived from his hard work (on a part-time and later on a full-time basis) and the calculated investments that he made; and

(f) the wife’s trust claims were brought almost six years after separation. The constructive trust claim was brought after the two-year expiry of the limitation date and, as such, is barred.

Law and Analysis

[51] The Preamble of the Family Law Act,[^3] (the “Act”) describes the legislative purpose as follows:

Whereas it is desirable to encourage and strengthen the role of the family; and whereas for that purpose it is necessary to recognize the equal position of spouses as individuals within marriage and to recognize marriage as a form of partnership; and whereas in support of such recognition it is necessary to provide in law for the orderly and equitable settlement of the affairs of the spouses upon the breakdown of the partnership, and to provide for other mutual obligations in family relationships, including the equitable sharing by parents of responsibility for their children[.]

[52] Sections 4(1) and 5(1) of the Act define and address the equalization of net family property, as follows:

4(1) “net family property” means the value of all the property, except property described in subsection (2), that a spouse owns on the valuation date, after deducting,

(a) the spouse’s debts and other liabilities, and

(b) the value of property, other than a matrimonial home, that the spouse owned on the date of the marriage, after deducting the spouse’s debts and other liabilities, other than debts or liabilities related directly to the acquisition or significant improvement of a matrimonial home, calculated as of the date of the marriage;

4(1.1) The liabilities referred to in clauses (a) and (b) of the definition of “net family property” in subsection (1) include any applicable contingent tax liabilities in respect of the property. 2009, c. 33, Sched. 2, s. 34 (2).

5(1) When a divorce is granted or a marriage is declared a nullity, or when the spouses are separated and there is no reasonable prospect that they will resume cohabitation, the spouse whose net family property is the lesser of the two net family property is entitled to one-half the difference between them. R.S.O. 1990, c. F.3, s. 5 (1).

[53] Section 5(6) of the Act permits the Court to adjust a presumptive equalization of spouses’ net family property in exceptional circumstances.

5(6) The court may award a spouse an amount that is more or less than half the difference between the net family property if the court is of the opinion that equalizing the net family property would be unconscionable, having regard to,

(a) a spouse’s failure to disclose to the other spouse debts or other liabilities existing at the date of the marriage;

(b) the fact that debts or other liabilities claimed in reduction of a spouse’s net family property were incurred recklessly or in bad faith;

(c) the part of a spouse’s net family property that consists of gifts made by the other spouse;

(d) a spouse’s intentional or reckless depletion of his or her net family property;

(e) the fact that the amount a spouse would otherwise receive under subsection (1), (2) or (3) is disproportionately large in relation to a period of cohabitation that is less than five years;

(f) the fact that one spouse has incurred a disproportionately larger amount of debts or other liabilities than the other spouse for the support of the family;

(g) a written agreement between the spouses that is not a domestic contract; or

(h) any other circumstance relating to the acquisition, disposition, preservation, maintenance or improvement of property. R.S.O. 1990, c. F.3, s. 5 (6).

5(7) The purpose of this section is to recognize that child care, household management and financial provision are the joint responsibilities of the spouses and that inherent in the marital relationship there is equal contribution, whether financial or otherwise, by the spouses to the assumption of these responsibilities, entitling each spouse to the equalization of the net family property, subject only to the equitable considerations set out in subsection (6).

[54] Courts have universally accepted that the Act is intended to promote predictability and discourage litigation.[^4] “Ontario deliberately chose a fixed valuation date approach. For most practical purposes, that date is the date of separation.”[^5]

[55] Post-valuation date changes in value can be remedied through trust claims (resulting and constructive) and an unequal division of net family property. Trust claims arise more often in cases involving non-married parties as they are prevented from making equalization claims. Unequal division claims are limited to findings of unconscionability (which is a much higher bar than “unfair or inequitable”) in the context of the equalization of net family property.

[56] There are public policy reasons to avoid deviating from the equalization provisions for married spouses. The regime discourages litigation while providing for an equal sharing of the debts and assets held by the parties for the duration of the marriage.

[57] In Serra v. Serra, the Court of Appeal described Ontario’s property regime (in the context of a discussion about section 5(6)) as follows:

The design of the legislation is to promote the goals of certainty, predictability and finality in the resolution of property matters following the breakdown of marriage. This, in turn, is founded on the central premise articulated in s. 5(7) that "inherent in the marital relationship there is equal contribution, whether financial or otherwise, by the spouses to the assumption of [their joint] responsibilities, entitling each spouse to the equalization of the net family property, subject only to the equitable considerations set out in subsection (6).

[58] During the course of the parties’ 16 year marriage, both parties worked (with the wife taking a maternity leave after each child) and they accumulated considerable assets (a jointly held matrimonial home, joint bank accounts and solely held investments).

[59] As presumed by the Act, during the course of the marriage the parties effectively operated as a “joint venture”. I accept that the parties used joint funds (which were available from their incomes, sole and joint accounts, loans and mortgages) to support the family and to support the husband’s interest in investing.

[60] The parties disagree as to the quantum of funds taken from Two Mortgages and deposited to the husband’s investment accounts. The wife states that the entire value of the mortgages ($450,000) was deposited in the husband’s investment accounts.

[61] The husband’s Amended Answer refers to $450,000 being deposited from the Two Mortgages. The husband states that this reference was merely to clarify where the funds had been deposited (in one rather than several accounts). He states that he did not have the relevant account statements at that time.

[62] Upon review of the investment accounts the husband identifies that the sum of $120,000 was deposited into the iTrade Account, with the amount of $30,000 being repaid to the parties’ joint TD Bank account on the day before separation. There is no evidence that the sum of $450,000 was deposited into any of the investment accounts.

[63] In keeping with the equalization of net family property regime, it is irrelevant whether the sum of $450,000, $120,000 or $90,000 was taken from the Two Mortgages and deposited in the husband’s investments prior to separation.

[64] It is also irrelevant whether all debt attached to the matrimonial home was paid off before the parties obtained the Two Mortgages (as submitted by the wife). Moreover, there is no reason or requirement to look at each party’s investments and attempt to identify how much was derived from their respective employment incomes, or joint or sole accounts, loans or mortgages. Whether there were nominal or significant amounts owing on the Two Mortgages on the date of valuation is also immaterial. That is the beauty of the equalization of net family property regime.

[65] As per Ontario Family Law Property 101, litigants take a “snapshot” of each party’s assets and debts on the date of marriage (nominal/none here) and a “snapshot” of his/her assets and debts on the date of separation. The party with the higher net family property pays the sum equal to one-half of the difference to the other party (subject to special provisions respecting the matrimonial home, trust issues, and notional disposition costs).

[66] The joint family venture ends on the date of separation and parties are presumed to be compensated by the equalization process. To the extent that either party has not been properly compensated because of his/her roles during the marriage, that claim is appropriately addressed through spousal support.

[67] The wife acknowledges in the original Application that during the marriage the parties benefited from an investment return of between $50,000 and $80,000, because the husband is a skilled investor. I agree.

[68] Had the parties opted not to use any loans or mortgages as seed money the pool of available funds for investment purposes would have been less. As a consequence, following equalization they would have each left the marriage with fewer assets (as compared to the Net Family Property calculation attached as Schedule “A”).

[69] Given the value of the husband’s investments on valuation date (which far exceeds the purported loans of $450,000, $120,000 or $ 90,000), and the testimony that his income and bonuses also funded the investments, I decline to find that he made no contribution to his investments during the marriage.

[70] The total amount held in all of the husband’s and the wife’s investments, the jointly held matrimonial home ($900,000), the Two Mortgages ($438,000) and all other assets and debts were subject to equalization. Following a traumatic separation, the wife did not see the husband for eight months. When she commenced her Application in February 2013, the wife sought a restraining order against him. There is no evidence the wife asked the husband to manage her investments or engage in a joint venture following the breakdown of the marriage.

[71] The equalization of net family property issues encourages predictability and finality, which is particularly important in cases involving high conflict. On the facts of this case I find there is no basis to deviate from the “clean break” approach.

[72] For the reasons set out above and as discussed below I conclude that the wife has no trust interest in the post-valuation increase in value of the husband’s investments. I also find that the wife has not met the test set out in section 5(6) of the Act in respect of her claim for an unequal division of net family property.

The Resulting Trust Claim

[73] The Ontario Court of Appeal in Korman v. Korman,[^6] provides a useful summary of the Act, and the relevant caselaw in the context of a case involving a married couple, as follows at paras. 25-27:

[25] For married spouses, the Act provides a comprehensive scheme for resolving financial issues following marriage breakdown. Section 10(1) of the Act authorizes a court to determine questions of title between spouses. This includes considering whether legal title actually reflects beneficial ownership. As indicated by this court in Martin v. Sansome, 2014 ONCA 14, 118 O.R. (3d) 522, at para. 47, citing Rawluk v. Rawluk, 1990 152 (SCC), [1990] 1 S.C.R. 70, “[b]efore property can be equalized under the [Act], a court must first determine the “net family property” of each spouse. This exercise requires first that all questions of title be settled.” In other words, property entitlements must be determined before they can be equalized.

[26] Section 14 of the Act affirms the presumption of a resulting trust in determining questions of ownership between spouses in the context of gratuitous property transfers. Where the presumption is invoked, the party resisting the imposition of a resulting trust is required to disprove the presumption that his or her spouse is the beneficial owner of an interest in the disputed property.

[27] In Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, at paras. 16-19, the Supreme Court confirmed that a traditional resulting trust may arise in the domestic context where, as here, there has been financial contribution to the initial acquisition of a property and a subsequent gratuitous transfer of title to the property. In these circumstances, the actual intention of the transferor is the governing consideration. See also Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at paras. 43-44; Schwartz v. Schwartz, 2012 ONCA 239, 290 O.A.C. 30, at paras. 41-42. Further, the intention of the transferor to make a voluntary and gratuitous transfer is an essential ingredient of a legally valid gift: see McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 401, at para. 24.

[74] As per sections 10(1) and 14 of the Act, the Court has the authority to determine questions of title between spouses and to find that a spouse has gratuitously conveyed property to his/her partner and is entitled to the return of the property. The Court also has the authority to make a finding of resulting trust. However, I decline to do so for the following reasons:

(a) the loans and mortgages placed on the matrimonial home were not gifts or gratuitous transfers by either of them to the other, nor is there any trial evidence to support such a finding. Furthermore, there is no basis to conclude that the mortgages were an effort to defeat creditors. Instead, the decision to fund the husband’s investments via the Two Mortgages supports a finding that the parties held a common intention during the marriage to create financial growth for the benefit of the family;

(b) the increase in value from the original seed money (irrespective of who/how the investments were funded) is shared equally as of the date of separation in accordance with the principles of the equalization of net family property; and

(c) the wife’s representation that she was left with sole responsibility to service the debts created by the mortgages, and that this liability is evidence of her proprietary interest in the investments is patently unreasonable:

i. for the period of time that pre-dated the transfer (January 1, 2012 to September 2013), the wife continued to reside in the matrimonial home with the children. Rather than secure alternate accommodation and pay rent, she chose to remain there. The inter-related issues of occupation rent and liability for carrying costs were pleaded and later abandoned. Any argument about the proper treatment of the wife’s contributions to the Two Mortgages cannot be considered without reviewing these inter-related issues which are not before me; and

ii. for the period of time from the date of the transfer and until the mortgages were repaid, it is incorrect to conclude that the wife’s payments afford her a resulting trust interest in the husband’s investments. In order to fund the buyout of the husband’s interest in the matrimonial home ($450,000), the wife made a payment and assumed the joint debts (for a value of $ 459,000). If, at the date of separation there were no mortgages and the parties had no other assets of value, the wife likely would have arranged financing to buy-out the husband’s interest. The wife is no further behind on account of the mortgages and is, in fact, further ahead given the value of the husband’s investments on valuation date (which are shared).

[75] For all of these reasons, the wife’s claim for a resulting trust interest of $1,783,052 is dismissed.

The Unjust Enrichment, Constructive Trust and the Unequal Division Claims

[76] The Supreme Court of Canada considered the use of unjust enrichment within the family law context in Kerr v. Baranow.[^7] Justice Cromwell outlined the following three elements that must be satisfied in order for a claim of unjust enrichment to be successful:

1. An enrichment of or benefit to the defendant;
2. Corresponding deprivation of the plaintiff; and
3. The absence of a juristic reason for the enrichment.

[77] The wife submits that the equalization of net family property regime unjustly enriches the husband by allocating to him the entirely of the post-separation date growth in investment value; she suffers a corresponding deprivation on account of the Two Mortgages and other financial contributions made throughout the marriage; and, there is no juristic reason for the enrichment and deprivation. She requests an unequal division of net family property or such other monetary award the Court deems just.

[78] The wife seeks a sharing of the family’s investments although she prefers a monetary award for unjust enrichment/constructive trust or an unequal division. She claims an entitlement to a monetary award reflective of the wealth created as a result of the relationship, which she calculates to be the sum of $1,627,131.

[79] The husband disputes the above relying on the equalization provisions (and policy reasons for same), his efforts to create the post-valuation date increases in value, and the inequity of these arguments (which do not account for the 2013 Agreement, the transfer of the matrimonial home, or the wife’s increased assets).

[80] In Martin v. Sansome,[^8] the Ontario Court of Appeal considered unjust enrichment in the context of section 5(7) of the Act.

The purpose of this [equalization] section is to recognize that child care, household management and financial provision are the joint responsibilities of the spouses and that inherent in the marital relationship there is equal contribution, whether financial or otherwise, by the spouses to the assumption of these responsibilities, entitling each spouse to the equalization of the net family property, subject only to the equitable considerations set out in subsection (6).

[64] In McNamee v. McNamee, 2011 ONCA 533, 106 O.R. (3d) 401, at para. 66 this court stated that, “in the vast majority of cases, any unjust enrichment that arises as the result of a marriage will be fully addressed through the operation of the equalization provisions under the Family Law Act.

[81] Monahan J. recently reviewed the caselaw respecting unjust enrichment and an unequal division of net family property.[^9] The underlying policy of the equalization provisions of the Act is that monetary and non-monetary contributions to the family unit are joint responsibilities of married spouses. These joint contributions are recognized through the entitlement of each spouse to the equalization of net family property, subject only to the equitable considerations set out in section 5(6) of the Act.

[82] In my analysis of the wife’s resulting trust claim I discredit the argument that she was disadvantaged by the joint loans incurred during the marriage (since the “snapshot” approach compensates a party as of the valuation date). I also reject the wife’s claim that her payments on the Two Mortgages are unjust. On the contrary, as stated previously, I find that that the wife benefited from the increased (and increasing) value of the matrimonial home which is now held in her name alone.

[83] In Straub v. Straub,[^10] McKelvey J. rejected the husband’s constructive trust claim for an interest in the matrimonial home (which had increased in value due to market conditions) on the basis that he had contributed to same during the marriage, had paid child support following the separation and had declined to claim occupation rent from the wife. The husband could not identify any specific contribution that he made to the residence after the valuation date.

[84] McKelvey J. also rejected the wife’s construction trust claim for an interest in the husband’s stock portfolio (which had also increased in value due to market conditions). The wife could not point to any specific contribution to the investment account after separation.

[85] I find that following the breakdown of the marriage each party has retained title to substantial assets (including the post-separation date increase in value); consequently, the test for unjust enrichment has not been met. An award of a constructive trust interest would not be appropriate given the benefits afforded by the Act, and the public policy reasons against the routine application of trust claims for married spouses.

[86] Many unjust enrichment cases involving married spouses arise from dramatic post-separation date increases in the value of real property due to changing market conditions.[^11] To the extent that it is challenging for a married spouse to succeed with such a claim, I find that it is far more difficult to succeed where the titled spouse’s efforts account for some or all of the increase in value post-separation.

[87] I accept the husband’s evidence that he has focused considerable time and effort (which he describes as his full-time employment since 2015) conducting research, attending meetings, buying and selling investment interests. Some of these investments are volatile. For example, a 2014 investment in an Ontario Ginseng company was purchased for $0.30 per share, increased to $1.50, when the market price for ginseng sky-rocketed, and then fell to $0.70 per share when tensions arose between Canada and China.

[88] I find that while the husband was somewhat enriched (as per paragraph 89 below), the wife did not suffer a corresponding deprivation. There are many juristic reasons to decline finding unjust enrichment and a corresponding deprivation in these circumstances including: such a finding would promote litigation, an indefinite joint family venture and a lack of predictability (as to the date for the division of assets and the division itself). Moreover, the parties entered into the 2013 Agreement which the husband relied upon when he executed the transfer of the matrimonial home at the separation date value. He did so with the expectation that all of the parties’ assets would be equalized.

[89] To the extent that the husband benefitted from the delay in making the equalization payment of $138,000 (and the additional amount of $29,220) owed to the wife on account of the equalization of net family property, my conclusion would not change for the following reasons:

(a) the wife had the benefit of buying out the husband’s interest in the matrimonial home (September 2013) at the separation date value (December 2011). Given the dramatic increase in value from then and until today (current real estate sale prices of comparable properties would suggest that the home is worth approximately $1,700,000), any enrichment has already been addressed;

(b) the husband would not have had access to the wife’s funds if she had complied with the 2013 Agreement that called for the division of all of the investments and assets; and

(c) pre-judgment interest can address the benefit derived from access to these funds.

Unconscionability

[90] Since I have declined to find unjust enrichment, I need not address the issue of an unequal division of the parties’ net family property. I have considered this issue in any event and I would not make a finding of unconscionability for the reasons that follow.

[91] As stated in Serra v. Serra,

To ensure adherence to the policy choices made by the legislature, and reflected in s. 5(7) and the preamble of the Act, equalization of net family property is the general rule. …Judicial discretion with respect to equalization payments is therefore severely restricted, by statutory design, but it is not eliminated altogether since there is discretion to order an unequal payment where "the court is of the opinion that equalizing the net family properties would be unconscionable": see, for example, Skrlj v. Skrlj, supra, at p. 309 R.F.L.” (para. 57)

[92] An examination into whether the equalization of net family property is unconscionable leads me to consider that the husband transferred his one-half interest in the matrimonial home (for $450,000 rather than his estimated value of $600,000). I also consider whether it is unconscionable to use the current value of the husband’s investments (which attract considerable notional disposition costs) while ignoring the current value of the wife’s investments (including the matrimonial home whose increase in value is tax-free, the Basement Apartment which defrays the wife’s personal income taxes, as well as the Carlton Townhouse which has materially increased in value). Finally, I account for the 2013 Agreement which anticipated that the matrimonial home and that all investments would be equalized at separation date values.

[93] Notwithstanding that the husband’s investments have increased, I do not find that that equalization would be “repugnant to anyone’s sense of justice” or that it would “shock the conscience”[^12] of the Court.

The 2013 Agreement

[94] The Relevant portions of the 2013 Agreement read as follows:

(a) Paragraph 1: “…This transfer is part of asset equalization and will be included in the final divorce settlement.”

(b) Paragraph 2: “The values of all the assets (house, bank/investment accounts etc.) subject to equalization are set on separation date (Dec 31, 2011).”

(c) Paragraph 3: “On the separation date, the matrimonial home is valued at $900,000. Jun Yao and Connie Zhou each is entitled to half of the value ($450,000).”

(d) Paragraph 4: “After the title transfer, Connie Zhou will assume and be solely responsible for the total outstanding mortgage ($423,838.65 as of September 19, 2013) and release Jun Yao’s portion of above said mortgage ($211,919.33).”

(e) Paragraph 5: “The released amount of Jun Yao’s portion of the mortgage ($211,919) assumed by Connie Zhou is applied to purchase Jun Yao’s share of home value.”

(f) Paragraph 6: “After the title transfer, asset equalization finalized and divorce agreement reached, the home will no longer be considered as matrimonial home.”

[95] The wife testified at the Original Trial that she was not represented by counsel when the 2013 Agreement was negotiated by the parties. However, the wife’s admission that TM was her family lawyer at that time, and a receipt confirming legal fees paid in 2013, refute that claim. The husband insisted that the wife review the 2013 Agreement with counsel. She admits that she followed the husband’s instructions and faxed TM a copy. She also acknowledges that the agreement was seen by TM before it was signed.

[96] An email exchange between the parties from September 10 to 18, 2013 confirms that husband was not prepared to make a deal without the lawyers involved. The wife responds that there is insufficient time for the lawyers to draft, and for the parties to sign, an agreement (before the existing mortgage term ends). She is reluctant to pay the cost of a separate agreement. However, the wife confirms that the final separation/divorce agreement will address the transfer and that writes that she has faxed her lawyer with those instructions.

[97] The wife’s fax to TM dated September 16, 2013, outlines the terms of the agreement and states that she agrees to same. A letter from TM to PM dated September 19, 2013 confirms the parties have arrived at a settlement of the issues between them and that the parties will be advising their respective lawyers. He proposes that a call be arranged to discuss same.

[98] The 2013 Agreement is executed on September 20, 2013, which is the date that the mortgage term expired. It is witnessed by two individuals.

[99] On October 13, 2013, TM requested that the husband provide his disclosure brief so that they could resolve the issue of equalization. TM requested same as he contemplated that there may (or may not) be adjustments to the draft NFP he had produced.

[100] As per the transcripts from the Original Trial, aside from a one-off statement about setting aside paragraph 2 (that was not plead nor pursued with supporting caselaw), the wife’s counsel repeatedly states that she is not seeking to set aside the 2013 Agreement.

[101] The wife’s current position is that she does not dispute the validity of the 2013 Agreement. She argues, instead, that the agreement does not speak to either party’s right to make trust claims, claims for an unequal division of net family property, or any other potential property claims. It does not contain any releases or waivers in that regard. Although the agreement states that the values of all assets subject to equalization are based on the date of separation, that term simply restates the provisions of the Act requiring the parties’ net family property to be calculated as at the date of separation. She submits that reading in a waiver of trust and other claims that are not expressly included in this agreement violates the longstanding principles of contractual interpretation.

[102] The husband argues that the 2013 Agreement is legally valid and contemplated the resolution of all property issues. The wife admitted at the Original Trial that paragraph 2 covers everything (in terms of property) and “there were nothing singled out”. He asserts that the two-part test in Miglin v. Miglin.[^13] to determine the validity of a domestic contract has been met.

[103] Since I have determined that the wife’s attempts to deviate from the equalization regime must fail, I need not decide whether the 2013 Agreement is a bar to trust and unjust enrichment claims, or whether it is a domestic contract or otherwise valid.

[104] However, I make the following observations (which will be relevant to my determination respecting costs). The parties’ evidence (and the absence of evidence to the contrary) leads me to conclude as follows:

(a) when the 2013 Agreement was signed, both parties contemplated that it would dictate the resolution of all property claims;

(b) the husband relied on the 2013 Agreement when he followed through with the transfer of the jointly held matrimonial home at the separation date value ($900,000) rather than some higher amount more reflective of market conditions;

(c) there is no evidence that any trust or unjust enrichment claims were contemplated until the wife retained new legal counsel and made the request to amend her pleadings (November 17, 2017);

(d) the wife attempts to “have it both ways”, when she argues that it reasonable that the house, her investments and her assets be valued at separation date, but the husband’s investments ought to be based on current value. This argument is disingenuous, contradicts public policy and is patently unfair; and

(e) the wife’s decision to disregard the 2013 Agreement (or comply with the rules respecting equalization) has had the following consequences: (i) both parties have unnecessarily incurred significant legal costs; (ii) unnecessary conflict has ensued (which no doubt impacts their children); and, (iii) judicial resources have been wasted.

The Limitation Period Issue

[105] The husband posits that the wife’s trust claims are statute barred by the Limitations Act. He relies on McConnell v. Huxtable to support the argument that the two year limitation period applies to married spouses making unjust enrichment claims (respecting assets that are not real property).

[106] The wife objects as the husband did not plead reliance on a limitation period as a cause of action. To support the objection, the wife relies on cases that were determined pursuant to the Rules of Civil Procedure rather than the Family Law Rules (the “Rules”).[^14]

[107] If I had not disposed of the wife’s trust claims on their merits, I would consider her argument respecting procedural fairness. The husband’s decision to raise this issue after the Original Trial denies the wife the opportunity to address same during the hearing or to provide evidence in respect of discoverability.

[108] The Ontario Court of Appeal confirmed in Frick v. Frick[^15] that “parties have the right to know the case they had to meet and the right to a fair opportunity to meet that case.”

[109] Without the benefit of submissions on this issue within the context of the Rules, I am not in the position to determine whether the husband’s Limitation Act argument must fail because he did not plead same.

[110] As to the merits of such a claim (if viable), The Annual Review of Family Law (2019–2020),[^16] states that “the analysis (in McConnell v. Huxtable) would lead one to a conclusion that equitable claims not involving land will be subject to a 2-year limitation period usually running from the date of separation. It is important that lawyers canvas any potential trust claims with their clients early on in their professional relationship to ensure that a limitation period is not missed with respect to an asset that does not involve real estate.”

[111] Since I have disposed of the trust claims on their merit, I need not decide the issue.

The Disposition of the Other Net Family Property Issues

[112] The husband submits that during the Original Trial the parties spent considerable time addressing five net family property issues that the wife no longer pursues. If the wife had corrected the relevant errors earlier, valuable trial time would have been saved.

[113] This issue is a matter properly addressed by the parties in costs submissions rather than at this time.

[114] There are, however, several determinations that must be made before the equalization of net family property can be calculated. They are as set out below.

The $40,000 (US) Loan

[115] On July 30, 2010, wiring instructions were sent to the husband in respect of a loan in the amount of $40,000 (US) payable to the wife’s sister to assist with the purchase of real estate. The husband argues that there is no reasonable explanation for the wife’s decision to send the wiring instructions to him, unless she was the party making the loan.

[116] The husband relies on emails between the parties from December 2012 about this loan. In these communications the wife does not deny that she made this loan and advises that the loan was repaid in summer 2012.

[117] The loan was omitted from the wife’s first financial statement. The May 2013 Kaufman J. Order includes a provision that she explain why the loan was not listed.

[118] At the Original Trial the wife testified that loan was made with the maternal grandmother’s money. She denies being a part of the loan transaction and states that she was merely assisting the maternal grandmother who does not speak English well.

[119] Other than the wife’s statement there is no evidence to support such a claim. The wife testified that she does not have a transaction record nor does she remember how she wired the funds.

[120] The wife could have called the maternal grandmother as a witness to confirm the origins of the loan. However, she opted not to do so.

[121] In an apparent contradiction, the wife testifies, “I don’t remember in what form she paid the funds back to us, but like I said in the email, she returned the funds.”

[122] Great care must be taken when relying on the wife’s evidence given the concerns respecting her credibility and reliability. I prefer the husband’s evidence which is supported by the emails over the wife’s poor memory and contradictory evidence.

[123] The husband includes in his submissions a calculation that converts the $40,000 (US) loan to $40,876 CAN (at a rate of $1.02 as of the date of separation). The wife does not refute this calculation and I accept same for the purposes of equalization.

The RRSP Accounts and Missing Investments

[124] The husband alleges that the wife has three hidden RRSP accounts with a separation date value of $30,001.

[125] The wife states that when she was employed at HSBC her group RRSP was managed by Sun Life. She listed a Sun Life RRSP account as an asset worth $9,266. When she stopped working at HSBC, she was required to move the RRSP.

[126] On April 22, 2013, the wife transferred to Foster & Associates the sum of $10,669, which were previously held in a Sun Life RRSP account. The wife also transferred the sum of $18,3777.45 from HSBC. The wife believes that the funds were derived from HSBC severance pay.

[127] The husband relies on transactions that take place after the date of separation (including her departure from HSBC) as evidence that the wife owned the three RRSP accounts before separation.

[128] I accept the wife’s testimony that she moved funds around after separation and may have made some calculation errors in her 2012 and/or 2013 Income Tax Returns. I decline to find that the wife failed to disclose the above accounts as valuation date assets.

[129] With respect to the ING Account, the husband submits that he purchased a Spousal RRSP in the amount of $5,000 prior to separation. The wife denies that she holds this account and testified that she does not receive statements.

[130] However, upon review of the parties’ 2012 joint TD Account statements the wife acknowledged that the sum of $10 per month was transferred to an ING Account.

[131] The husband requests that $5,000 be attributed to the wife since that was the amount of the initial contribution to ING and he has no evidence as to the actual quantum held by that institution on valuation date.

[132] I accept the husband’s evidence and will include the sum of $5,000 in the equalization calculation.

[133] The wife requests an order that the husband cooperate and sign whatever documentation is necessary to permit her to access the funds contained in her spousal RRSP with Great-West Life (account number ending ***3335). That is a reasonable request and I will make that order.

[134] With respect to the husband’s failure to include four US accounts in his October 2020 financial statement, the husband admits same. Given that the husband provided the wife with account statements for these accounts I accept that this was a careless mistake. In any event the omission of $26,000 (US) of current value from the financial statement is irrelevant to the equalization of net family property.

Notional Disposition Costs: RRSPs

[135] The husband requests that the notional disposition costs in respect of his RRSPs be at a rate of 35%. He identifies that the rate ought to account for the probable tax that will be incurred on the disposition, and the discounted present value of the disposition costs.

[136] The wife takes the position that the applicable tax rate for each of them is 25%.

[137] The husband relies on the Kirvan v. Kirvan[^17] a decision that sets the applicable tax rate at 33.7% for the respondent and 26.4% for the applicant. However, the evidence to support that determination came in the form of an expert’s report. No expert evidence has been produced in this case.

[138] While the husband identifies that he plans to withdraw his RRSPs within 10 years after his retirement he provides no retirement date, nor any evidence of any retirement plans as of the date of separation. I am unprepared to make any finding about his retirement or his intentions respecting his RRSPs.

[139] The husband testified that he focuses on growing his investments and avoids dissipating same. He states that if he disposes of the assets at one time the disposition rate would be as high as 50%.

[140] I accept the wife’s argument that there is no evidence to suggest that the husband will have to collapse his RRSPs “all at once”, and no evidence that he contemplated same on the date of separation. At that time the husband was 45 years of age. Given the significant savings he has amassed in other vehicles (TFSAs, investment accounts, etc.), as well as the efforts he has undertaken to ensure tax efficiency (i.e., by maintaining investment loans to allow the ongoing deduction of carrying costs), the evidence suggests he will likely withdraw funds from his RRSPs gradually and in a manner that limits his tax burden as much as possible.

[141] In Townshend v. Townshend,[^18] Kruzick J. found that notional disposition costs take into account a number of factors, most importantly the age of the parties. Courts routinely discount RRSPs by 25%.

[142] I recognize that the wife dissipated some RRSPs in 2019 and paid no taxes on disposition. However, it is inappropriate to rely on hindsight evidence. The determination of notional disposition costs is made as of the date of separation.

[143] I accept that 25% is an appropriate rate for each of the parties in the absence of expert evidence on the notional disposition costs.

Notional Disposition Costs: Unrealized Capital Gains

[144] In accordance with section 4(1.1) of the Act, the husband claims contingent tax liabilities in respect of the unrealized capital gains as of the date of separation. He notes that as compared to the matrimonial home, whose increase in value to the wife is tax-free in accordance with the principle residence exemption, there will be capital gains taxes payable on certain investments once sold.

[145] The wife submits that notional disposition costs should not be attributed on account of the husband’s contingent tax liability since, “you are not paying them.” Moreover, focusing solely on the principal residence designation ignores that the wife pays property tax on the assessed value of the home. The wife argues that the husband arranges his financial affairs to minimize the taxes payable (by writing off interest “carrying charges” and perhaps by carrying forward capitol losses from prior years). For these reasons his claim for notional disposition taxes is self-serving and cannot be relied upon by the Court.

[146] All of the wife’s arguments must fail. They are a further example of her request to “have it both ways.” The payment of property taxes does not detract from the significant benefit afforded to the wife on account of the principle residence exemption.

[147] Unlike the wife’s major asset of value (the matrimonial home), the husband’s major asset of value (his investments) have contingent tax liability. The Act directs the Court to include same in the equalization of net family property.

[148] This approach is confirmed in Sengmeuller v. Sengmueller.[^19] The Court held that if the costs are inherent in an asset, the “value” should be discounted by the tax and/or the disposition costs. Three rules to apply in all cases:

(1) Apply the overriding principle of fairness, i.e., that costs of disposition as well as benefits should be shared equally;

(2) Deal with each case on its own facts, considering the nature of the assets involved, evidence as to the probable timing of their disposition, and the probable tax and other costs of disposition at that time, discounted as of valuation day; and

(3)Deduct disposition costs before arriving at the equalization payment, except in the situation where “it is not clear when, if ever” there will be a realization of the property.

[149] The issue of notional disposition costs was one of the obstacles to the resolution of the property issues in 2013. During the Original Trial the husband submitted a calculation on contingent tax liability that enumerates the book value and separation date value of the investments that would attract capital gains. The husband did not testify about a specific need to dispose of these assets or the timing of same. However, when responding to questions about the investment loans the husband states that he did not have a savings account or chequing account with a large amount of cash. He explained that he borrowed funds for investment purposes. On the date of separation the bulk of the investments were held in the husband’s name, and the matrimonial home was held jointly. The husband produced the calculation for the Original Trial. I accept that he anticipated needing to dissipate at least some of these investments to make the equalization payment.

[150] The husband seeks a finding that 46% is the correct rate of notional disposition costs and he relies on hindsight evidence. The husband realized most of the capital gains from 2013 to 2014 when he sold stocks in anticipation of the purchase of a home, and the upcoming payment on account of the equalization payment. From 2011 to 2014, the husband’s marginal tax rate was 46%. He calculates the tax liability as the amount of $46,732.14 (on taxable capital gains of $101,239.47) and uses the amount paid as evidence as to the appropriateness of the rate.

[151] In Knight v. Knight[^20] the Court found that hindsight evidence should not be relied upon in determining the value of an asset but, rather, ought to calculate the value of that asset based on information that existed at the time of separation.

[152] The Ontario Court of Appeal held in Zavarella v. Zavarella,[^21] that the only permissible use of hindsight evidence is to confirm assumptions that are made on the valuation date.

[153] In the absence of evidence of a firm plan/intention to dissipate these investments following separation, the rate of notional disposition costs must be discounted to address the contingent nature of same and the present value. The husband is astute in the area of tax efficiencies, and he may have capital losses to defray any tax liabilities. It is unclear to what extent the husband planned to dispose of some or all of these investments on the date of separation. He chose not to produce expert evidence on this issue. For these reasons I conclude that a notional dispositions costs rate of 25% is reasonable.

Post Separation Date Withdrawals and Adjustments

[154] The wife requests that the husband provide an accounting of his investment withdrawals and pay the sum of $425,901.29, which is equal to 50% of the funds removed from his investments after separation. She argues that the husband used joint funds to satisfy his child support obligations and to support himself.

[155] Since I have dismissed the wife’s claims to any trust interest in the husband’s investments there is no basis for an accounting, or a sharing of any amounts withdrawn by the husband from January 1, 2012 onwards.

[156] The husband seeks an adjustment in the amount of $22,711 on account of a joint line of credit. The wife admits that she withdrew the sum of $22,000 without the husband’s consent. On February 25, 2013, the husband repaid that amount and interest.

[157] The wife states the parties agreed as follows: (a) this amount is the husband’s share of personal expenses he incurred on the line of credit; or (b) the repayment was in lieu of child support from January to July 2012. She has produced no evidence to support this agreement, nor any credit card or bank statements as back up to the chart that she submitted.

[158] The husband denies any agreement and states that the repayment request was listed on his financial statements.

[159] I note that from January to July 2012, the parties continued to manage their finances jointly by depositing their salaries and bonuses into the TD account and using same to fund the parties’ living and property related expenses. The husband submits that the wife’s arguments are not reasonable. I agree.

[160] The line of credit chart purportedly lists debts incurred to meet each party’s personal needs or the family’s needs. The husband should not be solely liable for the repayment of this debt. It is also unreasonable for the wife to claim that the $22,711 was in lieu of child support when the family continued to operate financially as if the household was intact. The wife cannot “have her cake and eat it too.”

[161] At the Updating Trial the husband acknowledged that he may be responsible for approximately $10,000 of expenses included in the Scotia Bank line of credit. He agrees to be liable for that amount. The wife shall be liable for the balance.

Conclusions in Respect of the Property Claims

[162] I dismiss the wife’s claims for resulting trust, constructive trust, unjust enrichment, joint family venture, an unequal division of net family property and a post-separation date adjustment.

[163] Schedule “A” attached to, and forming part of, these Reasons is a Net Family Property Statement prepared by the Court from the parties’ financial statements as modified by their testimony. Except for the items listed in these Reasons the overall differences between the parties were not significant.

[164] The payment owed by the husband on account of equalization and post-separation date adjustments is $29,220 (after accounting for the 2018 pre-payment of $133,439 and the buy-out of the matrimonial home), plus pre-judgment interest. This shall be paid by the husband within thirty (30) days.

[165] The wife owes the husband the sum of $12,711 on account of the amounts that she withdrew from the parties’ joint Scotia Bank line of credit following separation. This shall be paid by the wife within thirty (30) days.

V. RETROACTIVE AND ONGOING CHILD AND SPOUSAL SUPPORT

What is the Appropriate Amount of Child Support and Spousal Support Payable to the Wife Commencing September 1, 2016?

[166] Both parties allege that a significant income should be imputed to the other, and a low income (the wife)/no income (the husband) be attributed to each of them. This is another example of the parties’ attempts to “have it both ways.”

Law and Analysis

The Parties’ Incomes for Support Purposes

[167] The starting point for this analysis is section 19 and Schedule III of the federal Child Support Guidelines (the “Guidelines”).

The relevant subsections are as follows:

19 (1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following:

(a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;

(e) the spouse’s property is not reasonably utilized to generate income;

(g) the spouse unreasonably deducts expenses from income;

(h) the spouse derives a significant portion of income from dividends, capital gains or other sources that are taxed at a lower rate than employment or business income or that are exempt from tax

Reasonableness of expenses

(2) For the purpose of paragraph (1)(g), the reasonableness of an expense deduction is not solely governed by whether the deduction is permitted under the Income Tax Act.

SCHEDULE III (SECTION 16): ADJUSTMENTS TO INCOME

Dividends from taxable Canadian corporations

5 Replace the taxable amount of dividends from taxable Canadian corporations received by the spouse by the actual amount of those dividends received by the spouse.

Capital gains and capital losses

6 Replace the taxable capital gains realized in a year by the spouse by the actual amount of capital gains realized by the spouse in excess of the spouse’s actual capital losses in that year.

Business investment losses

7 Deduct the actual amount of business investment losses suffered by the spouse during the year.

Carrying charges

8 Deduct the spouse’s carrying charges and interest expenses that are paid by the spouse and that would be deductible under the Income Tax Act.

[168] The leading case that defines intentional under-employment in Ontario is Drygala v. Pauli.[^22] “Intentionally” means a voluntary act. The person required to pay support is intentionally under-employed if that person chooses to earn less than he or she is capable of earning. The person required to pay support is intentionally unemployed when he or she chooses not to work when capable of earning an income.

[169] When imputing income based on intentional under-employment or unemployment, a court must consider what is reasonable in the circumstances. The factors include age, education, experience, skills and health of the parent. The availability of job opportunities, number of available work hours (in light of the parent's overall obligations including educational demands), and a reasonable hourly rate may be considered.

[170] For the reasons that follow I find that each party is intentionally under-employed. I impute a reasonable income to each of them.

[171] The Guidelines specifically contemplate that carrying and interest costs be deducted from investment income. I decline to find that the husband unreasonably deducts these expenses from income.

[172] I accept that income ought to be imputed to the husband since a significant portion of his income from dividends, capital gains or other sources that are taxed at a lower rate than employment or business income. The appropriate amounts are grossed up in my calculations below.

[173] With respect to an income attributable to the wife, I conclude that it is appropriate to impute rental income because she unreasonably deducts expenses on both investment properties and is creating barriers to renting out the Basement Apartment.

The Husband’s Income

[174] In consideration of the approach defined above (allowing for the carrying costs/interest and grossing up the capital gains and dividends), I find that the husband’s 2012 income for support purposes is $190,047 (inclusive of his base salary and bonus of $142,313).

[175] In October 2013, the husband was terminated from his position as an electronic engineer. His income for support purposes was $243,929 (inclusive of his base salary $127,356 and no bonus). He was 47 years of age.

[176] The husband’s 2014 income for support purposes is $358,519 (inclusive of severance pay in the amount of $74,089 and employment insurance of $10,420).

[177] The husband asserts that the significant capital gain income in 2013 and 2014 is attributable to the disposition of (most of) his separation date investments that had unrealized capital gains. The husband anticipated purchasing a home and making the equalization payment (in accordance with the 2013 Agreement). However, the husband states that double dipping is not a concern. He echoes his wife’s assertion that the 2012 – 2015 income is irrelevant as she no longer claims spousal support prior to September 1, 2016.

[178] The husband’s disclosure reveals that he submitted four resumes from late 2013 through 2014, and 22 job applications in 2015 (which resulted in interviews with five companies). He contacted five recruiters from 2015 – 2016, contacted four previous co-workers and appears to have done little, if any, professional networking.

[179] The husband states that he applied for additional employment positions in 2013 and 2014. He does not have a fulsome job search log or back up documentation as he did not appreciate the relevance of same until he obtained new legal counsel (LB) in early 2015.

[180] Throughout this time the husband continued to focus on his investment activities which continued to grow and yield an increasing investment income.

[181] In 2015, the husband opted to no longer pursue employment positions, choosing instead to become an investor on a full-time basis. He decided to forgo the plan to purchase a home (a decision that remains unchanged), choosing instead to use the capital to fund further investments. The husband’s business activities include conducting research, attending meetings and buying and selling investments.

[182] The husband acknowledges that he could have found a position earning $90,000 and admits that his colleagues found positions earning from $100,000 to $115,000.

[183] For the reasons set out below I find that the husband’s 2015 income for support purposes is $297,118 (inclusive of employment insurance of $9,018 and an imputed income of $90,000).

[184] The above findings in respect of the husband’s income do not impact the child and spousal support payable as the wife requests that her retroactive claims commence on September 1, 2016. However, the calculations assist in the determination as to a reasonable imputed income.

[185] The wife states that the husband is intentionally under-employed. She requests that an employment income of $115,000 or $90,000 be imputed to the husband.

[186] The wife alleges that the husband does not work full-time as investing is not a traditional form of employment. Moreover, the husband admits to spending two to three months out of the country each year. From 2012 to 2019, the husband travelled to Norway, Ireland, Spain, Japan, Taiwan, China and the United States.

[187] The wife also disputes the reasonableness of the husband’s decision to decline to pay down separation date investment debt ($436,000) given the interest that continues to accumulate and the significant growth in investment value. She argues that the husband intentionally maintains the investment debt as a tax-savings strategy, in order to claim the carrying costs deduction, thereby reducing his taxable income. While such a strategy for minimizing tax liability may be acceptable for tax purposes, it is not acceptable for support purposes. For these reasons the wife requests that the carrying costs be removed from the calculation of the husband’s income or that income be imputed for unreasonably deducting expenses.

[188] The husband testified that he continues to work during some of his travels (particularly during an extended stay in China to care for his elderly parents), and that the research about potential and existing investments (including site visits to wherever the investments are situated which take place several times a year), is time consuming. He takes three to four weeks of vacation each year.

[189] Relying on schedule III of the Guidelines, the husband argues as follows: (1) the 2019 carrying costs deduction summary and all carrying costs statements issued by the banks and financial institutions confirm that the deductions are directly connected to the husband’s income generating efforts; (2) the husband’s income would be lower if the loans were repaid as less investment income would be generated (presumably on account of the reduced capital available for investment purposes); and, (3) the Schedule III directs the spouse to deduct the carrying charges and interest expense that are deductible under the Income Tax Act.

[190] My findings in respect of the husband’s income for support purposes are as follows, starting with section 19(1) (g) and (h) and moving on section19(1) (a) of the Guidelines.

[191] I dismiss the wife’s section 19(1) (g) argument that the husband unreasonably deducts carrying charges and interest expenses under Schedule III of the Guidelines. The Ontario case that she relies upon, Pollitt v. Pollitt,[^23] is distinguishable on the facts. The Court denied the spouse’s deductions as the interest and carrying charges were incurred to finance an equalization payment. The husband in this matter provides ample evidence that the interest and carrying charges are connected to his business and investment income. Schedule III, section 8 applies to these facts and the amounts are appropriately deducted.

[192] With respect to section 19(1) (h), it is appropriate to gross up the husband’s income to account for the lower rate of taxes attributed to capital gains, dividends or other sources of income as compared to employment or business income.

[193] I find that the husband is intentionally under-employed as per section 19(1) (a). Throughout the marriage the husband worked in a traditional full-time position and his employment status did not change as he became more involved in the investment activities. Following the closure of the company in 2013, the husband’s attempts to find a replacement employment position were not reasonable.

[194] The husband admits that business colleagues in similar circumstances are employed earning 70% to 80% of his income. I accept the wife’s argument that the husband could have found a position in that range. According to the website payscale.com, the upper end range for an engineering job is $90,000, however, the husband previously earned employment income of $142,313 inclusive of a bonus.

[195] There is no evidence that the husband would have ceased his investment activities if he had found traditional employment. From an obligation to pay support perspective it was not reasonable for the husband to decline to pursue a full-time position.

[196] The husband’s time and effort have contributed to the growth in the value of his portfolio. The investments may not have grown as significantly if the husband had less time to devote to his activities because he was also working full-time. I also appreciate the husband chooses to limit his investment withdrawals to the amounts that he requires to support himself (and pay child support). As per the husband’s testimony, investing is like buying an apple tree. You need to harvest the tree to get profits. I accept that if you cut the tree there will be less apples.

[197] However, I do not agree that an income of $140,000 is appropriate for the calculation of the husband’s support obligations for the following reasons:

(a) the husband controls the extent to which he invests in dividend producing assets and those whose value is derived from capital gains. The husband admitted that his 2013 and 2014 earnings were higher than in other years as he disposed of investments and incurred capital gains in advance of a plan to purchase a home. In other words, the husband has control over his income for support purposes;

(b) without imputation the husband’s income for support purposes is relatively stagnant when comparing 2012 ($193,047) to 2019 ($206,713) and does not reflect the husband’s dramatic increase in net worth;

(c) the wife and children have no interest in the husband’s investments. The growth does not impact their lives unless an income is imputed to enable them to benefit from his improved financial circumstances;

(d) as stated by Pazaratz J.,[^24] “parents are required to act responsibly when making financial decisions that may affect the level of child support available. They must not arrange their financial affairs so as to prefer their own interests over those of their children”;

(e) to the extent that the husband used the family’s joint assets and had access to joint debt to fund what has become a highly successful venture, and had the time to focus on this endeavor (given that there were two small children at home) the wife should be compensated. To achieve a fair result, a reasonable amount of income must be imputed to the husband;

(f) the husband should not be permitted to constrain his income in circumstances where the payor has obligations to support the wife (following a 16 year marriage) and two children. To permit otherwise sacrifices the wife’s needs and the children’s needs in favour of the accumulation of the husband’s future wealth;

(g) since shifting his career focus to investments, the husband has paid considerably lower income taxes. In 2012, when the husband was employed full-time and invested on the side, he paid the amount of $36,949 on a line 150 income of $231,814. As of December 31, 2011, his investment portfolio was worth $1,476,308. In contrast, in 2019, the husband paid the amount of $13,473 on a line 150 income of $164,425. The investment portfolio was approximately $3,566,104; and

(h) the husband does not dispute the wife’s calculation that post-separation he has withdrawn the sum of $927,920 from his investment accounts. He used these amounts to support himself, pay child support, cover the costs of his niece’s university education and pay income taxes. On a per year basis the husband has used the equivalent of $103,102 in after tax dollars toward his expenses (and he had access to his employment income, severance and employment from 2012 - 2015). During the same nine year period the husband’s investments have grown dramatically.

[198] The challenge here is to derive a reasonable imputed income to the husband, given the complexities set out above. My calculation is based on the following: (1) for 2012 to 2015 - the husband’s actual income, severance and employment insurance; (2) for 2015 – 2019 - an imputed income of $90,000 to account for under-employment and the husband’s low rate of taxes; (3) treatment of the husband’s investment income as per the Guidelines, including deducting the carrying costs/interest and grossing up the tax savings; and (4) for 2020 onwards - using the information provided for 2019 as that is the best available evidence.

[199] I have attributed an annual employment income of $90,000 for the following reasons: (1) the husband acknowledges that he was doing a good job when he was laid off; (2) his colleagues are earning between $100,000 and $110,000; and (3) accepting a lower level, less stressful and/or part-time position or consulting work would be reasonable in the circumstances to enable the husband to also focus on his investment activities. His income for support purposes is set out in the chart below.

[200] The husband’s annual income for spousal support purposes[^25] is as follows: (a) For 2016,[^26] a gross income of $250,279; (b) For 2017,[^27] a gross income of $233,222; (c) For 2018,[^28] a total income of $261,626; (d) For 2019,[^29] a total gross of $277,693; (e) For 2020,[^30] a gross income of $277,693; and (f) For January 2021[^31] onwards, a gross income of $277,693.

The Wife’s Income

[201] As described by the wife, during the course of her career (1999 to 2018) she was employed conducting hospital supporting data analysis for clinical research, and then as a statistical programmer in the pharmaceutical industry. The wife also spent five years working at HSBC bank retail lending department as a credit risk systems analyst.

[202] It is challenging to determine the wife’s income from September 1, 2016 onwards (which is the requested commencement date for spousal support) as only the 2019 ITR is filed in its entirety. My factual findings are based on the following: (a) oral evidence provided at trial, (2) excerpts from the wife’s tax returns; (3) rental income charts created for the trial; and, (4) two Carlton Townhouse lease agreements.

[203] I note that prior to her being laid off in September 2018, the wife was employed as a Clinical Programmer in Syneos Health Canada. She earned an employment income of approximately $85,000. The wife’s income prior to 2016 cannot be determined as she declined to provide financial disclosure (as her requested start date for the adjusted child support and spousal support is September 1, 2016).

[204] In 2018, the wife earned $78,166 in employment income. After her termination the wife received severance of $59,758 in October.

[205] The wife states that in 2019, she withdrew funds from her RRSPs and cashed in some investments to pay down investment debt, to reduce her monthly payments, and to cover her own and the children’s expenses (including $100,000 in legal fees). I decline to include the wife’s taxable capital gains and RRSP income in the calculation of support.

[206] Between January and September 2020, the line of credit was paid down by $97,000, notwithstanding that the wife states she is in dire financial circumstances and her only income is from government benefits. The wife testified that she is permitted to use Helen’s funds to pay down the line of credit and has access to funds from the mortgage deferral program.

[207] The wife describes her attempts to secure employment as diligent. At trial she relied on a lengthy job search record (although the husband correctly identified that one contact or application may have multiple line entries). The wife confirms that she sent out more than 100 applications in total since losing her job (including 34 in 2019). She points out that the parties attended their Trial Scheduling Conference in April 2019 and had the Original Trial in June 2019.

[208] At the Original Trial the wife was agreeable to imputing employment income at $60,000 and rental income of $11,920, which she explains is 40% of the gross rental income (although my calculation yields the amount of $13,536). However, since the wife continues to be unemployed (18 months after the Original Trial) and since she is no longer earning positive rental income, she proposes that her income be imputed at $35,000 per annum.

[209] The wife submits that after two years of unemployment, she has not been able to obtain employment. Therefore, she is now adjusting her salary expectations and considering further training if the market continues to be unfavourable to her.

[210] The husband asserts that the attributed income is significantly understated for the following reasons: (a) the wife is highly educated with a Master’s Degree obtained from the University of Alberta; (b) the wife was employed in her field for more than 20 years and was a senior level statistical analyst at the time her employment was terminated; (c) minimum wage in Ontario is $14.25 per hour; (d) A junior cashier with little experience at Walmart earns approximately $15 per hour or $30,000 per year; (e) the wife’s attempts to secure employment are unreasonable; (f) the wife receives no income for the roles that she plays (secretary and treasurer) on behalf of 2659477 Ontario Inc. (for which she has no shareholding interest); and (g) rental and business income (in respect of the investment properties) have not be factored into the wife’s proposed income. I agree with all of the above.

[211] An income that is close to minimum wage is highly inappropriate in the circumstances of this case. On average the wife has applied for 3.7 jobs per month (from October 2018 to December 2020). While it is clear that she has spent considerable time and effort in pursuit of this litigation (as has the husband), it is inappropriate to rely on a family law case as a means to justify a party’s failure to actively seek employment (particularly since she has been represented/assisted by counsel).

[212] The wife was 47 years old when she lost her employment position and she is 49 today. In 2020, the wife received employment insurance until March and the CERB benefits (which may need to be repaid).

[213] I find that an imputed income of $60,000 (as per the amount agreeable to the wife at the Original Trial) for 2019, 2020 and on an ongoing basis, is reasonable in the circumstances. That is approximately 70% of the wife’s prior employment income.

[214] I also agree with the husband’s position that an income should be imputed to the wife on account of her investment property interests. I find that for family law purposes the wife is unreasonably deducting expenses from the Basement Apartment, as she writes off 33% or 50% of the mortgage, utilities, internet and other expenses. Most of these expenses are incurred whether or not there are tenants in the basement.

[215] At the Updating Trial the wife testified that she hired a real estate agent and listed the Basement Apartment on Kijiji after the tenants vacated the unit in August 2020. However, the wife subsequently admitted that she has set the rent at $1,850 per month (rather than the prior amount of $1,300) to deter any applications during the pandemic. I note that the Basement Apartment is a full unit and enables the wife to dramatically reduce her income taxes (as she writes off 30% or 50% of the carrying costs and other expenses).

[216] Given the wife’s claim that she is experiencing dire financial circumstances, and the fact that she continues to incur excessively high living expenses ($127,000), the decision to deter further tenants is not reasonable. I am imputing annual rental income of $6,240.

[217] With respect to the Carlton Townhouse, the wife declared (as per her 2019 ITR) that she receives 100% of the gross rent and is liable for 80% of the tax deductible expenses. However, she has also provided sworn evidence that she holds a 50% interest (at the Updating Trial) and a 0% interest (as per her 2019 financial statement).

[218] The mother and maternal grandmother hold the property as joint tenants. In order to purchase the property in 2015, a mortgage was placed on the townhouse ($240,000), the wife obtained a line of credit against the matrimonial home ($260,000) and a cash down-payment was made ($21,000).

[219] The significant expenses attributed to the Basement Apartment and Carlton Townhouse account for 93.4% of the wife’s 2019 declared gross rental income of $36,000. A net rental income of $2,376 is unreasonable for family law purposes. The wife admits that she estimates annual gross rental income for tax purposes. She makes mistakes on the declared business expenses, as confirmed by the 2018 Markham Tax Bill which is lower than the claimed expense. Therefore, the net revenue claimed is unreliable and unreasonable for family law purposes.

[220] I opt to use an amount equal to 40% of gross rental income in my determination of the wife’s income. This accords with the wife’s position at the Original Trial, the husband’s position in closing submissions and is reasonable as per the caselaw.[^32]

[221] I attribute a net rental income to the wife on account of the Basement Apartment ($6,240 per year commencing 2016) and (an 80% interest in) the Carlton Townhouse ($7,296 per year commencing 2017 due to tenancy issues in 2016). For 2018, I use a slightly lower amount as per the wife’s ITR on account of some unclear and undefined rental expenses (40% of $29,800 rather than $33,840).

[222] The wife may have additional rental income that may be attributable to her on account of two Toronto Condos. The husband discovered these units after the Original Trial. Based on the evidence provided at the Updating Trial, my findings are as follows: (1) the two Toronto Condos were purchased pre-construction by a corporation that lists her as secretary and treasurer. She is not a shareholder of the corporation; (2) the maternal grandmother fully funded the deposits (either $104,00 according to the wife or $174,000 according to the husband). I note that no evidence was provided to support this claim; (3) the maternal grandmother is financially dependant on the wife. She does not pay rent or contribute to the household expenses. This information is contained in an affidavit sworn by the maternal grandmother on January 13, 2017. The maternal grandmother explained that the 2015 investment in the Carlton Townhouse caused her to become dependant on the wife. I query how the maternal grandmother could afford to make the eight deposits on the two Toronto Condos starting in 2016 or 2017; (4) the units rent out for approximately $1,950 to $2,050 per month; (5) while unit 1506 has been vacant (for an unknown amount of time), the listing states that it is only available as of February 1, 2021; (6) the rent is paid to the maternal grandmother’s personal account; (7) the wife is listed as a guarantor and named on both TD Bank mortgages (although she states there is no personal liability as they are owned by a corporation); and (8) the wife admits that the decision to set up a corporation to own the Toronto Condos, and the consequential commercial loan (with a “ridiculous” interest rate of 10%) was designed to prevent the husband from learning of these assets. She feels compelled to register any new property in this way to avoid further disclosure demands and litigation with the husband.

[223] The husband claims that the wife has a 100% interest in the two Toronto Condos. There is insufficient evidence to support this finding, or to determine what rental income, if any, should be attributable to the wife. This issue was raised for the first time at the Updating Trial, and neither party called the maternal grandmother to provide evidence on this issue.

[224] He alleges that the wife has under-reported her income to Revenue Canada for the past 10 years. As a consequence, she has paid little or no taxes.

[225] For example, the wife claimed carrying costs/interest (including legal fees and what appears to be an erroneous deduction of the entirety of the B2B mutual fund loan). Deduction for these items amounts to $154,124. The net result is that the wife claimed a taxable income of $0 and obtained a tax refund of $19,676. The wife denies under-reporting her income and attributes any issues with her Income Tax Returns to “mistakes”, yet she continues to file using Turbo Tax rather than consulting a professional for assistance.

[226] Though problematic from a credibility perspective, I am not prepared to impute an income to the wife on account of the above.

[227] The husband requests that income be imputed to the wife on account of a homestay business. The wife acknowledges that in one school year (including 2017) a high school student resided at her home and paid rent. There is no evidence to contradict the wife’s position that there have been no further students. The wife’s 2017 ITR declares gross business income of $5,200, on account of the homestay student. I find that the wife’s related business expenses are unreasonable and unrelated to hosting a student. However, I recognize that there are costs to hosting the student.

[228] Given the wife’s evidence that the student resided with her over the course of one school year, I attribute 40% of the gross business income to wife for 2017 in the annual amount of $2,080. As no evidence was proffered as to whether the student was present in 2016 or 2018, I decline to impute an income during either of those years. Moreover, while the wife’s April 29,2019 financial statement includes a gross monthly revenue of $850 on account of a bed and breakfast, there is no evidence in her 2019 ITR of same, and she denies having a student at that time. I decline to impute an income as there is insufficient evidence to support an annual amount that would be appropriate.

[229] The husband requests that the wife’s annual income for support purposes be imputed at $125,600. This amount includes imputed income of $85,340 which is equal to the wife’s last employment position. It also includes net annual rental income of $40,260, which assumes the wife’s 100% interest in the Basement Apartment, Carlton Townhome and two Toronto Condos, a 100% occupancy in each unit and no commission/leasing fees. In the alternative he requests that the wife’s annual income be imputed to $85,340.

[230] I have addressed the wife’s 2020 and ongoing income by imputing employment income of $60,000 and net rental income of $14,166. I decline to make any other adjustments to her income.

[231] The wife’s annual income for support purposes is as follows: (a) For 2016,[^33] a gross income of $91,240; (b) For 2017,[^34] a gross income of $101,246; (c) For 2018,[^35] a gross income of $151,765; (d) For 2019,[^36] a gross income of $84,877; (e) For 2020,[^37] a gross income of $74,166; and (f) For January 2021[^38] onwards, a gross income of $74,166.

The Wife’s Claim for Spousal Support

[232] The wife seeks an order for indefinite periodic spousal support or lump sum support on a compensatory and/or non-compensatory basis. At the Original Trial the wife sought an order for support in the mid-range of the Spousal Support Guidelines, (“SSAG”), however, the wife now requests spousal support in the high range.

[233] The husband argues that the wife has no financial need and has been appropriately compensated. The wife retains the matrimonial home which has increased in value from $512,000 (when purchased in 2007) to $900,000 (December 31, 2011) to $1,200,000 (the husband’s estimated October 2013 value), to approximately $1,700,000 (December 2020, as per comparable properties). She has furnished the basement to produce an income-earning rental property.

[234] The wife holds an 80% interest (or perhaps an 50% interest) in the Carlton Townhouse whose value has increased from $521,000 to approximately $770,000 (based on a comparable unit in the complex that has a lower rate of property tax). The wife may have a trust or other interest in the two Toronto Condos, which have a combined value of approximately $970,000 (as per a comparable unit in the building).

[235] Finally, the wife also has significant unaccounted for deposits in her bank accounts and has entered into a pre-construction purchase agreement for another property. The wife responds that the deposits and down-payment belong to her friend Helen. I agree with the husband’s concerns that the wife’s statements are suspicious and not believable.

[236] The Court has jurisdiction to make a spousal support order pursuant to section 15.2(1) of the Divorce Act.[^39]

[237] The guiding factors for a court to consider when making a spousal support order are set out in section 15.2(4) are as follows:

Factors

(4) In making an order under subsection (1) or an interim order under subsection (2), the court shall take into consideration the condition, means, needs and other circumstances of each spouse, including

(a) the length of time the spouses;

(b) the functions performed by each spouse during cohabitation, and

(c) any order, agreement or arrangement relating to support of either spouse

[238] The “condition” of a spouse includes such factors as their age, health, needs, obligations, dependants and their station in life. A spouse’s “means” encompasses all financial resources, capital assets, income from employment and any other source from which the spouse derives gains or benefits.[^40]

[239] The Ontario Court of Appeal determined that the factors and objectives outlined in the Divorce Act require a balancing of “the parties’ circumstances, including the duration of the parties’ cohabitation, their ages, their incomes and prospective incomes, the effects of equalization, the stages of their careers, contributions to the marital standard of living, participation in household responsibilities, the absence of child-care obligations, [and] the parties’ reasonable expectations.”[^41]

[240] The Supreme Court of Canada held that all of the stated objectives in section 15.2(6) of the Divorce Act must be considered since no single objective is paramount. However, trial judges have a significant amount of discretion to determine the weight that should be placed on each objective based on the particular circumstances of the parties. The purpose of spousal support is to relieve economic hardship that results from marriage or its breakdown.[^42]

[241] There are three conceptual bases for entitlement to spousal support:

(a) compensatory: This is in recognition that upon marriage breakdown, there should be an equitable distribution between the parties of the economic consequences of the marriage. Specifically, compensatory support is intended to compensate a spouse upon relationship breakdown for contributions made to the relationship and to recognize sacrifices made and the advantages to one spouse and disadvantages to the other, both during and after the breakdown of that relationship. It is to compensate for foregone careers and missed opportunities during the marriage, and to serve as reimbursement for hardships accrued as a result of the marriage breakdown;

(b) contractual: This entitlement may arise from express or implied agreements between spouses that purport to either create or negate a spousal support obligation; and

(c) non-compensatory: This entitlement arises as result of the needs of a spouse, even if that need does not arise as a result of the roles adopted during marriage. This basis for spousal support is founded on the view that marriage is a relationship involving mutual obligations and interdependence that may be difficult to unravel when the marriage breaks down.[^43]

[242] With respect to compensatory spousal support, Nolan J. stated the following in Friedl v. Friedl,[^44]:

The court in DelGuidice v. Menard,[^45] provides a concise description of compensatory spousal support: it is “intended to address a recipient’s economic loss or disadvantage or the recipient’s uncompensated conferral of an economic benefit on the payor, arising out of the respective roles assumed during the marriage.” Most often, the economic disadvantages suffered by a spousal support claimant will be in the form of foregone opportunities for career or educational advancement, and will usually stem from the parties’ decision that the claimant spouse will be primarily responsible for the care of the parties’ children in the performance of associated domestic duties.

[243] The wife came to Canada in January of 1996 on a full scholarship that paid her tuition and living expenses. She received a Master’s degree from the University of Alberta and holds a Master’s equivalent education in the field of Nutrition and Immunology. She has never been employed in her field of study and testified that she could not commit to the lab requirements on account of her familial responsibilities.

[244] The husband found his first job at the end of 1998 in Mississauga. Subsequently, the wife left her profession in biotech and moved to Toronto so that the parties could stay together.

[245] The wife testified that she took extended maternity leaves. CZ was four years of when she returned to the workforce on a full-time basis.

[246] At the Original Trial, the husband did not suggest or dispute that the wife was the primary caregiver for the children. While the parties disagree about who is to blame for the husband’s limited parenting time, he does not disagree that following separation it has not been extensive.

[247] Previously, the children spent time with the husband for a few hours on a weekly basis. The children have not stayed overnight at the husband’s home for a long time. There has been no in-person parenting time since the commencement of the Covid-19 pandemic.

[248] I accept the wife’s argument in favor of compensatory and non-compensatory entitlement. I also find that the husband benefited from the wife’s roles during the marriage as it provided him with the opportunity and time to initiate investment activities. The loans and mortgages on the matrimonial home provided the seed money that led to the substantial investment portfolio which has continued to grow dramatically since separation.

[249] The wife’s compensatory claim persuades me that it is appropriate to use the husband’s increased income for support purposes (as compared to his separation date income). I have considered the wife’s requests to apply the high range of the SSAG calculations and her request for an award of indefinite support. However, I have determined that the SSAG mid-range and the mid-point (12 years) are appropriate for the following reasons:

(a) the husband’s astute investment acumen provides a higher equalization payment as compared to an alternative scenario wherein the husband never pursued these activities during the marriage. As part of the equalization regime she shared in the significant value of these investments;

(b) the wife’s request to commence spousal support as of September 1, 2016 (which the husband attributes to her desire to withhold prejudicial financial disclosure) results in the utilization of higher income amounts for the husband (as per my calculations for 2016 onwards) and lower income amounts for the wife (as of 2019);

(c) the wife was compensated by the transfer of the matrimonial home at the separation date value rather than the 2013 or current value. If the property had continued to be held jointly and, as part of this trial was ordered to be sold, the husband’s one-half interest may have been worth at least $850,000 (as per the comparable properties);

(d) the wife has been able to leverage the equity in the matrimonial home to furnish the Basement Apartment, to purchase the Carlton Property and perhaps as an investment in the two Toronto Condos;

(e) by supporting the maternal grandmother and providing her with a place to live (at the matrimonial home), they collectively hold an investment portfolio of four units; and

(f) the wife has entered into an Agreement of Purchase and Sale for another property (although I am unable to determine what interest, if any, would be attributable to her (by title or in trust)).

Year	Husband’s Income for Spousal Support	Wife’s Income for Spousal Support	Annual Taxable Amount	Annual After-Tax Benefit to Wife
2016 (Sept +)	$252,279	$91,240	Sept onwards $12,360	Sept onwards $7,000
2017	$233,222	$101,246	$22,857	$12,935
2018	$261,626	$151,765	$14,723	$7,660
2019	$277,693	$84,877	$48,564	$28,313
2020	$277,693	$74,166	$51,521	$32,003
2021	$277,693	$74,166	n/a	n/a
Total Owing:				$87,911

[250] I am awarding periodic spousal support. The amount owing from 2016 to 2020 of $87,911, shall be paid in the after-tax value to the wife (since the support will not be tax deductible to the husband or taxable to her). This shall be paid within thirty (30) days.

[251] For the period from January 1, 2021 to December 31, 2028, the husband shall pay support on a monthly basis in the amount of $4,293, which shall be tax deductible to him and taxable to the wife.

[252] I note that the older child CZ is not currently a child of the marriage, however, I am not prepared to increase the spousal support on that basis for three reasons: (a) the wife should not benefit from the child’s early voluntary withdrawal from her control due to parent-teen conflict; (b) the husband has stated his intention to support CZ directly and I have included the sum of $7,000 for that purpose. I am reinstating the child support on the assumption that the child is returning to the wife’s home; and, (c) there is little difference between the adjusted child support amount for one child ($2,476), and the amount of support she received ($2,525).

The Table Amount of Child Support Payable

[253] The Kaufman J. May 2013 Consent Order provides that the husband pay child support in the monthly amount of $2,525, on a without prejudice basis commencing May 1, 2013.

[254] The wife seeks an order that child support be adjusted retroactive to September 1, 2016.

[255] The husband believes that he has overpaid child support.

[256] Following the conclusion of the Updating Trial on December 9, 2020, the husband learned from the York Region Children’s Aid Society (the “Society”) that CZ had moved to a friend’s home in June 2020. This is not disputed by the wife who attributes the change to parent-teen conflict.

[257] I have reviewed the affidavit materials provided by the parties in respect of the status of CZ as a child of the marriage[^46] for the purposes of child support. Given that CZ voluntarily withdrew from parental control on June 16, 2020, the child support should have terminated, or, at a minimum, it should have been suspended on consent.

[258] Instead, the wife failed to disclose the child’s changed residential status and continued to accept the support payments. Moreover, the wife filed a financial statement sworn October 15, 2020, stating that she has two children who live in the home. That was untrue.

[259] During a December 15, 2020, meeting arranged by the Society, CZ disclosed that she had not paid the friend’s family any room or board but was providing assistance with babysitting, cooking and housekeeping. The child obtained a part-time job on some weekends to support herself. The Society arranged a Voluntary Youth Service Agreement that provided some financial assistance on December 31, 2020.

[260] The wife’s actions are highly problematic, as is the decision to hide the child’s changed circumstances from the husband and from the Court. A better approach would have been to engage with the child in counselling and communicate with the husband to explore whether CZ could reside in his care. I do not accept that the wife could not afford to pay for counselling services (which is an undisputed section 7 expenses in any event).

[261] The husband argues that the CZ ought to have been supported during this period. He believes that the wife should have provided the child with one-half of the table amount that she received. The wife’s failure to do so resulted in the host family being denied any financial contribution for room and board. The wife attests that she only recently learned that the child and the Society had not paid room and board. She consequently provided the family with the sum of $5,000. The wife states that she directly and indirectly provided CZ with cash and supplies in the approximate amount of $2,000. I accept that these payments should be considered in the calculation of child support.

[262] As per the wife’s recent affidavit, the child is currently quarantining at one of the Toronto Condos, with the intention of returning to her home on January 17, 2021. On the assumption that the child will be residing primarily with the wife as by January 31, 2021, I am suspending the child support from July 1, 2020 and reinstating it on February 1, 2021. During this period the child support shall be adjusted so that the husband is only liable for the table amount payable for one child plus $7,000 on behalf of CZ.

[263] If the above assumption about the child returning to the wife’s primary care is incorrect, the parties are directed to include this information in the affidavits that will accompany their costs submissions. I will then correct this mistake.

[264] The parties are directed to inform the FRO, and to adjust the amount of child support payable, if either child’s status as a child of the marriage changes at any time.[^47]

Year	Husband’s Income for Child Support[^48]	Child Support Payable	Child Support Paid	Amount Owing
2016 (Sept +)	$280,029	$34,176[^49]	$30,300	$3,876
2017	$244,747	$38,568	$30,300	$8,268
2018	$283,755	$44,184	$30,300	$13,884
2019	$314,155	$48,468	$30,300	$18,264
2020 (Jan-June)	$313,523	$24,234	$15,150	$9,084
2020 (July – Dec)	$313,523	$21,856[^50]	$15,150	$6,706
2020 (Jan)	$313,523	$2,476	$2,525	($49)
Total Owing:				$60,033

[265] As per the chart below, the husband owes the amount of $60,033 on account of adjusted child support, which shall be paid within thirty (30) days.

[266] Commencing February 1, 2021, the table amount for two children is $4,039 per month.

The Section 7 Expenses

[267] The Kaufman J. May 2013 Consent Order provides that the husband will pay 60% of specific section 7 expenses, on a without prejudice basis, and other expenses as agreed. In consideration of the parties’ current incomes for support purposes (including spousal support), I am adjusting the ratio. The section 7 expenses shall be shared on a 68% (husband) and 32% (wife) basis.

[268] I find that following the Consent Order conflict arose between the parties about section 7 expenses. The husband had no way to verify that the wife actually incurred the expenses. Over time he determined that she was falsifying receipts (including hockey camps claimed in an amount that was considerably higher than the wife’s receipts) and making improper claims for section 7 expenses (including childcare when the children were ages 12 and 14). The husband alleges he has over-paid section 7 expenses. The wife denies all of the above.

[269] After receiving contribution requests without proper receipts, the husband contacted (or wanted to contact) the third party providers. The wife stopped providing this information as he was harassing the providers (which he denies and alleges is in violation of the Kaufman J. April 9, 2018 Order).

[270] The wife complains that the husband contributed very little to the children’s section 7 expenses but admits that she stopped filing her claims with the FRO (which was the process that had been agreed to by the parties). She states that the husband disputed every claim that she filed with the FRO.

[271] Neither party called third party evidence in respect of the section 7 expenses. The wife ultimately decided to forgo her claims except for the amounts agreed to by the husband and from 2018 onwards. For example, the wife did not pursue her request for $40,828 of section 7 arrears that is listed in her 2016 Net Family Property Statement. She also abandoned her claim for hockey camp expenses, soccer and scouts. I note that the husband produced receipts from each organization that differed from those that were provided by the wife to him and/or the FRO. The alleged falsification of receipts was never proven however, it is suspicious that the wife opted not to pursue any of the disputed section 7 expenses prior to 2018 (which rendered the anticipated third party testimony irrelevant to the determination of arrears).

[272] The wife has now withdrawn her request for a contribution to a $2,800 French Immersion Summer program organized by Cegep De Jonquiere. At the Updating Trial the wife attempted to rely on the T4A income slip issued to the child, CZ as a receipt for her request for a proportionate share of $2,800. This was not an appropriate section 7 request as the child received a bursary of $2,800 to cover the expense (which is treated as taxable income as per the T4A). I accept the husband’s evidence that the only expense that qualifies as a section 7 expense is a registration fee of $275. I echo his concern that the wife’s testimony was misleading and inaccurate.

[273] While the wife sets out a request in the amount of $5,013 (from 2016 to 2018), I was unable to find any agreement respecting same. For that reason, I order the husband to pay the sum of $3,409 (68%) of the expenses with receipts that were submitted at the Original Trial and at the Updating Trial.

[274] If the wife seeks a contribution to a child’s psychological she must provide a proper receipt from the psychologist.

[275] The wife seeks an ongoing payment of $400 per month on account of section 7 expenses, to avoid future conflict with the husband. Given her admission that there are no current section 7 expenses such a request is inappropriate.

[276] The husband recently incurred a section 7 expense on behalf of CZ for the payment of university applications in the amount of $400. He has provided a receipt for same. The wife is liable for $128 (32%) on account of this expense.

[277] The parties seek directions in respect of the children’s post-secondary expenses and ongoing child support during that timeframe. I decline to make specific orders in respect of the amounts to be paid as it premature to conclude where each child may reside at the relevant time.

[278] The husband advises that the amount of $104,000 is currently held in two RESPs for the children.

[279] I provide the parties with the following guidance with respect to support once either child (who is a child of the marriage) attends a post-secondary educational institution. If either child resides with either parent full-time (and does not incur expenses for an apartment or residence), the payor should pay the table amount to the recipient parent. If the child resides with a parent during the summer and school breaks, then a reasonable approach is for child support to be paid for 5/12 months.[^51] In either scenario, the RESPs are not typically used to pay the table amount of support but for the child’s tuition, residence/rent, food, books, transportation, computer and other incidentals.

[280] Given the amount of distrust between the parties, aside from the table amount (if applicable), all payments shall be made to the third party providers (university, landlord) or to the child.

[281] Any amounts towards the child’s post-secondary expenses that are not covered by the RESPs, should be shared by the parties in accordance with their incomes for support purposes (which includes spousal support), unless either child obtains loans or bursaries to defray the costs. As stated above, I am setting the section 7 proportions at 68 % (husband) and 32 % (wife).

[282] With respect to the wife’s request for a contribution to each child’s graduate degree, it is premature to address that issue at this time.

[283] If the parties cannot agree on the post-secondary expenses, I suggest that they attend at mediation or mediation/arbitration with a senior family lawyer or a retired judge to resolve this matter.

Security for Support

[284] The wife requests an order requiring the husband to obtain life insurance to secure his child support and spousal support obligations. I decline to do so as there are ample assets available to comply with the husband’s obligations and he is in full compliance with his monthly child support payments.

[285] The husband’s child support (table amount and section 7 expenses) and spousal support obligations shall be a first charge on his estate.

VI. THE DIVORCE

[286] The husband filed affidavit materials to support the granting of the parties’ divorce.

[287] At the Updating Trial the wife provided testimony to form the evidentiary basis for the divorce.

[288] The divorce is granted.

VII. PRE-JUDGMENT INTEREST AND COSTS

[289] The parties are requested to provide submissions as to the amount of pre-judgment interest payable on the 2018 equalization advance ($133,439) and on the additional amount owed pursuant to this Judgment ($29,220).

[290] With respect to costs, there has been divided success. The husband is mostly successful on the property issues, and the wife is somewhat successful (in terms of certain relief sought but not quantum) in respect of the support issues. The parties are encouraged to resolve the issue of costs on consent.

[291] If the parties are unable to resolve pre-judgment interest and/or costs by January 20, 2021 the following is ordered:

1. The husband shall deliver his submissions by January 29, 2021.
2. The wife shall deliver her submissions by February 8, 2021.
3. Reply (if any) from the husband by February 12, 2021.
4. Submissions shall be double-spaced (12-font Times New Roman) and, in the case of (1) and (2) above, limited to five pages: reply is limited to two pages. They shall form part of the Continuing Record.
5. Materials shall be filed through the Family Submissions Online Portal and a second copy emailed to the Judicial Assistant (Nurit.suzana@Ontario.ca) when they have filed their submissions.
6. Offers to Settle, Bills of Costs, calculations of pre-judgment interest and any list (with hyperlinks) of authorities upon which a party may wish to rely shall be filed by the deadlines above but not form part of the Continuing Record.

VI. FINAL CONCLUSIONS

[292] This family exemplifies the impact of conflict on children. The husband’s parenting time since separation (when the children were ages six and eight) has been limited. From the onset of the Covid-19 pandemic and until the Updating Trial only virtual contact had taken place. Parent-teen conflict between the wife and the child did not bring the parents together but led to CZ moving to a friend’s home. The wife declined to share this information with the husband, the child did not feel ready to do so, and the Society intervened to provide support for the child. For several months the only in-person contact between CZ and anyone in the family was with her younger sister, DY. As adults, how will CZ and DY describe their childhood?

[293] What is the opportunity cost of the incessant pursuit of this litigation about the family’s finances? At a minimum it is the ability to provide themselves and their children with the chance to have some measure of closure and peace. In the context of a cost and benefit analysis, the value of finality ought not to be ignored.

VII. DISPOSITION

[294] Order to go in accordance with the draft Order and Divorce Order signed by me this day.

[295] A summary of the required payments are as follows:

(a) The husband shall pay the following amounts to the wife within thirty (30) days;

i. the sum of $29,220, on account of the equalization payment owed (after accounting for the post-separation date adjustments);

ii. the sum of $87,911, on account of retroactive spousal support from September 1, 2016 to December 31, 2020, inclusive;

iii. the sum of $60,033, on account of retroactive child support from September 1, 2016 to January 31, 2021, inclusive; and

iv. the sum of $3,281, on account of retroactive section 7 expenses from 2018 to January 31, 2021 (which includes a credit for the wife’s share of the university applications).

(b) The wife shall pay the following amounts to the husband within thirty (30) days;

i. the sum of $12,711, on account of the amounts that she withdrew from the parties’ joint Scotia Bank line of credit following separation.

[296] Commencing on February 1, 2021 and on the first day of each month thereafter, the Respondent shall pay Child Support Guidelines (“Guidelines”) table amount of child support in the amount of $4,039 per month for the following children, CZ, born ___2003, and DY, born on __2005. The Respondent’s imputed income for child support purposes is $313,523.

[297] Child support shall end for either child when she is no longer a child of the marriage as defined by the Divorce Act. The recipient shall notify the payor immediately if either child is no longer a child of the marriage for support purposes.

[298] For as long as child support is to be paid, the parties shall exchange updated income disclosure in the form of their respective Income Tax Returns and Notices of Assessment for the previous tax year by June 1^st annually, pursuant to section 24.1 of the Guidelines. Any required adjustment to the Guideline child support payable or the parties’ proportionate shares of the Children’s section 7 expenses shall take effect as of July 1^st each year.

[299] The parties shall review the ongoing Guideline child support payable (if any), and the payment of each child’s post-secondary education (if any), on or before May 2^nd of the year that each Child reaches the age of majority (18 years of age).

[300] If either Child enrolls in a full-time post-secondary education program and resides primarily with either party after they reach the age of majority (18 years of age), Guideline child support may continue to be payable for that Child to the party with whom they primarily reside, until such time as the Child no longer primarily resides with either parent or support is otherwise terminated as per paragraph 297 above.

[301] The section 7 expenses shall be shared on a 68% (husband) and 32% (wife) basis as follows:

(a) the section 7 expenses shall be as agreed to by both parties, in writing, in advance and such consent shall not be unreasonably withheld;

(b) a full, proper and legible copy of the receipt for the section 7 expense, containing the full contact information of the service provider, shall be provided to the other party within seven (7) days;

(c) upon request by the other party, the party incurring the section 7 expense shall provide any required consent or authorization for the other party to contact the service provider to verify the section 7 expense; and

(d) subject to the above criteria being met, the other party shall reimburse the party who incurred the expense within seven (7) days.

[302] The following expenses qualify as section 7 expenses, subject to paragraph 301 above:

(a) music lessons (up to $2,000 per year per child unless otherwise agreed to by the parties);

(b) spring/summer camp programs (up to $2,000 per year per child unless otherwise agreed to by the parties);

(c) tutoring;

(d) sports and music training;

(e) counselling/psychologist/psychiatrist; and

(f) uninsured medical expenses for the children or, alternatively, the children’s portion of medical coverage obtained by the Applicant on their behalf.

[303] The parties shall share in the cost of the children’s post-secondary educations inclusive of the first degree (and additional degrees as agreed to by the parties or ordered by the Court), as follows:

(a) post-secondary expenses that are not funded by the two RESP accounts (Account#: 1458 5290248, Balance: $48,066.82 Account#: 1458 5448125, Balance: $56,061.99) shall be shared proportionately (Respondent (68%) and Applicant (32%)), unless otherwise agreed to by the parties or ordered by the Court; and

(b) all education expense payments from these accounts shall be made directly to the education institutions, the landlord or directly to the child. The expenses include:

i. tuition and related school/administration fees;

ii. residence or similar accommodation if the children are not residing in residence;

iii. books;

iv. meal plans or similar food budget if the children are not residing in residence;

v. one laptop;

vi. cell phone and a phone plan; and

vii. travel to and from school for holidays.

[304] Commencing January 1, 2021 to December 31, 2028, the husband shall pay periodic spousal support on a monthly basis in the amount of $4,293, with the payments indexed annually. The spousal support shall be tax deductible to the husband and taxable to the wife.

[305] Spousal support shall terminate on December 31, 2028, unless the Court makes a different order upon finding a material change in circumstances that warrants a different amount of spousal support or a different termination date.

[306] The child and spousal support obligations shall be secured by way of a first charge on the husband’s estate.

[307] The husband shall cooperate and sign whatever documentation is necessary to permit the wife to access the funds contained in her spousal RRSP with Great-West Life (account number ending ***3335).

[308] Directions respecting submissions in respect of pre-judgment interest and costs are contained in paragraph 291 above.

[309] All other claims made by the Applicant pursuant to her Amended Application dated November 21, 2017 and made by the Respondent pursuant to his Amended Answer dated December 21, 2017 are hereby dismissed.

Justice A. Himel

Date: January 12, 2021

Schedule “A” – C.Z. and J.Y.

ONTARIO

Court File Number: FC-13-42559-00

Superior Court of Justice, Family Court at 50 Eagle Street West, Newmarket, Ontario, L3Y 6B1

Form 13B: Net Family Property Statement

Applicant(s): C.Z.

Respondent(s): J.Y.

The valuation date for the following material is (date): Dec 30, 2011

The date of marriage is (date): September 20, 1995

Table 1: Value Of Assets Owned on Valuation Date

PART 4(a): LAND

Nature & Type of Ownership	Address of Property	APPLICANT	RESPONDENT
Matrimonial Home	Markham, ON	$450,000.00	$450,000.00
15. Totals: Value of Land		$450,000.00	$450,000.00

PART 4(b): GENERAL HOUSEHOLD ITEMS AND VEHICLES

Item	Description	APPLICANT	RESPONDENT
Household goods & furniture
Cars, boats, vehicles	1999 Honda Odyssey	$1,000.00
Jewellery, art, electronics, tools, sports & hobby, equipment
Other special items
16. Totals: Value of General Household Items and Vehicles		$1,000.00	$0.00

PART 4(c): BANK ACCOUNTS AND SAVINGS, SECURITIES AND PENSIONS

Category	Institution	Account Number	APPLICANT	RESPONDENT
Stock				$586,456.00
Stock and Mutual Fund				$122,336.57
RRSP				$127,658.35
Locked-in RRSP				$46,100.14
Mutual Fund				$91,996.14
Mutual Fund				$96,957.39
Mutual Fund				$45,423.17
Mutual Fund				$123,306.54
Mutual Fund				$130,858.14
TFSA				$59,534.72
RRSP				$18,869.08
Joint Chequing Account			$25,775.42	$25,775.42
RRSP			$28,179.28
TFSA			$9,260.04
RRSP			$56,536.92
Stock			$18,729.00
RRSP			$1,204.79
RRSP			$9,243.88
RRSP			$7,945.71
Investment			$37,000.91
Joint Chequing Account			$1,036.12	$1,036.12
RRSP			$5,000.00
Joint Savings			$508.64	$508.64
17. Totals: Value of Accounts And Savings			$200,420.71	$1,476,816.42

PART 4(d): LIFE AND DISABILITY INSURANCE

Company, Type & Policy No.	Owner	Beneficiary	Face Amount ($)	APPLICANT	RESPONDENT
18. Totals: Cash Surrender Value Of Insurance Policies				$0.00	$0.00

PART 4(e): BUSINESS INTERESTS

Name of Firm or Company	Interests	APPLICANT	RESPONDENT
19. Totals: Value Of Business Interests		$0.00	$0.00

PART 4(f): MONEY OWED TO YOU

Details	APPLICANT	RESPONDENT
Money Owed to You – Loan to Applicant’s sister (USD40,000 converted to CAD based on exchange rate of 1.0219 on Dec 30, 2011)	$40,876.00
20. Totals: Money Owed To You	$40,876.00	$0.00

PART 4(g): OTHER PROPERTY

Category	Details	APPLICANT	RESPONDENT
21. Totals: Value Of Other Property		$0.00	$0.00
22. VALUE OF PROPERTY OWNED ON THE VALUATION DATE, (TOTAL 1) (Add: items [15] to [21])		$692,296.71	$1,926,816.42

Table 2: Value Of Debts and Liabilities on Valuation Date

PART 5: DEBTS AND OTHER LIABILITIES

Category	Details	APPLICANT	RESPONDENT
Mortgage on Matrimonial Home	Bank Mortgage Account# (Amount at transfer $211,919.33)	$220,703.45	$220,703.45
Loan	Investment Loan Account#		$86,552.42
Loan	Investment Loan / Solution Banking #		$100,245.00
Loan	Investment Loan Account#		$100,462.16
Loan	Investment Loan Account#		$99,303.41
Loan	Investment Loan Account#		$49,115.55
Loan	Investment Loan Account#		$49,078.01
Disposition Costs on RRSPs (25%)		$25,777.65	$48,156.89
Contingent Tax Liabilities – Unrealized Capital Gain ($101,239.47 at 25%)			$25,309.86
Disposition Costs on Undisclosed RRSP	Disposition Costs on Undisclosed Standard Life RRSP
Disposition Costs on Undisclosed RRSP		$1,250.00
23. Totals: Debts And Other Liabilities, (TOTAL 2)		$296,809.11	$729,848.74

Table 3: Net value on date of marriage of property

PART 6: PROPERTY, DEBTS AND OTHER LIABILITIES ON DATE OF MARRIAGE

Category and Details	APPLICANT	RESPONDENT
Land (exclude matrimonial home owned on the date of marriage, unless sold before date of separation).
General household items and vehicles
Bank accounts and savings
Life and disability insurance
Business interests
Money owed to you
Other property
3(a) TOTAL OF PROPERTY ITEMS	$0.00	$0.00
Debts and other liabilities (Specify)
3(b) TOTAL OF DEBTS ITEMS	$0.00	$0.00
24. NET VALUE OF PROPERTY OWNED ON DATE OF MARRIAGE, (NET TOTAL 3)	$0.00	$0.00

Table 4: PART 7: VALUE OF PROPERTY EXCLUDED UNDER SUBS. 4(2) OF "FAMILY LAW ACT"

Item	APPLICANT	RESPONDENT
Gift or inheritance from third person
Income from property expressly excluded by donor/testator
Damages and settlements for personal injuries, etc.
Life insurance proceeds
Traced property
Excluded property by spousal agreement
Other Excluded Property
26. TOTALS: VALUE OF EXCLUDED PROPERTY, (TOTAL 4)	$0.00	$0.00

Summary

	APPLICANT	RESPONDENT
TOTAL 2: Debts and Other Liabilities (item 23)	$296,809.11	$729,848.74
TOTAL 3: Value of Property Owned on the Date of Marriage (item 24)	$0.00	$0.00
TOTAL 4: Value of Excluded Property (item 26)	$0.00	$0.00
TOTAL 5: (TOTAL 2 + TOTAL 3 + TOTAL 4)	$296,809.11	$729,848.74
TOTAL 1: Value of Property Owned on Valuation Date (item 22)	$692,296.71	$1,926,816.42
TOTAL 5: (from above)	$296,809.11	$729,848.74
TOTAL 6: NET FAMILY PROPERTY (Subtract: TOTAL 1 minus TOTAL 5)	$395,487.60	$1,196,967.68

EQUALIZATION PAYMENTS

Applicant Pays Respondent	Respondent Pays Applicant
$0.00	$400,740.04

Post Separation Adjustments October 2013 Transfer of MH to wife, value of $450,000 October 2013, the parties completed a buy-out of husband’s ½ interest in the matrimonial home. The wife assumed the husband’s liability for the two mortgages and she paid the sum of $238,080.67 June 2018, husband made an advance equalization of $133,439.47 Outstanding payment owed: $400,740.04 - $238,080.67- $133,439.47 = $29,220

[^1]: RSO 1990, cC.43.

[^2]: Jayawickrema v. Jayawickrema, 2020 ONSC 2492, at para. 28.

[^3]: R.S.O. 1990, c.F.3, s. 5(1).

[^4]: Ward v. Ward, (2012) 2012 ONCA 462, 111 O.R. (3d) 81 (Ont. C.A.) at para. 25.

[^5]: Serra at para. 41.

[^6]: 2015 ONCA 578.

[^7]: 2011 SCC 10 at para. 32.

[^8]: 2014 ONCA 14. This principle was confirmed in Symmons v. Symmons, 2012 ONCA 747.

[^9]: Manchanda v. Thethi, 2019 ONSC 1749 at para. 54.

[^10]: Straub v. Straub, 2013 ONSC 1713, affirmed 2013 ONCA 721.

[^11]: See for example, Martin v. Sansome, supra and Manchanda v. Thethi, Straub v. Straub, 2013 ONSC 1713, affirmed 2013 ONCA 721.

[^12]: Smith v. Smith, 2012 ONSC 1116, at para. 23.

[^13]: Miglin v. Miglin, 2003 SCC 24, [2003] 1 S.C.R. 303.

[^14]: Free v. McPherson, 2013 ONSC 7416, para. 27 and S. (W.E.) v. P. (M.M.), 2000 16831 (ON CA), 50 O.R. (3d) 70 (2000) at paras. 35-38.

[^15]: 2016 ONCA 799, at para. 29 citing Rodaro v. Royal Bank of Canada (2002), 2002 41834 (ON CA), 59 O.R. (3d) 74 (C.A.), at para. 61, parties have “the right to know the case they had to meet and the right to a fair opportunity to meet that case.” See also Labatt Brewing Company Limited v. NHL Enterprises Canada, L.P., 2011 ONCA 511, 106 O.R. (3d) 677, at paras. 5-9.

[^16]: J. McLeod and A. Mamo, 2020 Thomson Reuters Canada Limited at page 951.

[^17]: Kirvan, 2016 ONSC 7712, [2016] O.J. No. 6360.

[^18]: 2020 ONSC 6405 at para. 39, rev’d on other grounds, citing Downe v. Downe, 2005 6783 (ON CA), [2005] O.J. No. 1005 (S.C.J.).

[^19]: (1994), 1994 8711 (ON CA), 2 R.F.L. (4^th) 232 at para. 33.

[^20]: 2018 ONSC 3294, [2018] O.J. No. 2771, at para. 171. See also Kirvan, supra note 15 at para. 106.

[^21]: Zavarella, 2013 ONCA 720, 117 O.R. (3d) 641.

[^22]: Drygala v. Pauli, 2002 41868 (ON CA), para. 28.

[^23]: 2010 ONSC 167, at para. 138.

[^24]: Jackson v. Mayerle, at para. 715.

[^25]: These amounts are derived from Divorcemate Tools One calculations.

[^26]: Imputed Employment ($90,000) + CND Dividends grossed up ($112,218) + Interest/Investment ($471) + Taxable Capital Gains grossed up ($40,205) + Other ($81) – Carrying Costs/Interest ($43,031).

[^27]: Imputed Employment ($90,000) + CND Dividends grossed up ($111,338) + Interest/Investment ($3,053) + Taxable Capital Gains grossed up ($29,630) + Other ($229) – Carrying Costs/Interest ($45,431).

[^28]: Imputed Employment ($90,000) + CND Dividends grossed up ($94,475) + Interest/Investment ($1,413) + Taxable Capital Gains grossed up ($50,856) + Other ($41) – Carrying Costs/Interest ($52,292).

[^29]: Imputed Employment ($60,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^30]: Imputed Employment ($60,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^31]: Imputed Employment ($60,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^32]: See for example, Eager v. Graves, 2002 45014 (ONCA) at para. 9 (40%) and Wilkinson v. Wilkinson, 2008 ONCJ 96 at para. 26 (45%).

[^33]: Employment ($85,000) + Basement Apartment ($6,240).

[^34]: Employment ($85,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926) + Student ($2,080).

[^35]: Employment ($78,167) + Other Income - Severance ($59,758) + Taxable Dividends ($1,012) + Rental Income (0.4 x $ 29,800 = $11,920) + RRSP income ($1,187).

[^36]: Imputed Employment ($60,000) + Employment Insurance ($10,711) Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^37]: Imputed Employment ($60,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^38]: Imputed Employment ($60,000) + Basement Apartment ($6,240) + Carlton Townhouse ($7,926).

[^39]: Divorce Act, R.S.C. 1985, c. 3 (2nd Supp), as am., sections 15.2(1) and 15.2(4)

[^40]: Bracklow v. Bracklow, 1999 715 (SCC), [1999] 1 S.C.R. 420 (S.C.C.), paras. 36 and 39; Smith v. Smith, 2012 CarswellOnt 3113 (S.C.J.), para. 69.

[^41]: Fisher v. Fisher, 2008 ONCA 11, 2008 CarswellOnt 43 (C.A.), at para. 84.

[^42]: Moge v. Moge, 1992 25 (SCC), [1992] 3 S.C.R. 813 (S.C.C.), at paras. 44, 53-54; Bracklow v. Bracklow, supra, at para. 35; Smith v. Smith, supra, at para. 70.

[^43]: Smith v. Smith, supra, at para. 72.

[^44]: 2012 ONSC 6337.

[^45]: 2012 ONSC 2756 at para. 53.

[^46]: Divorce Act, R.S.C. 1985, s.2.

[^47]: In this case the support should be adjusted on consent to the amount of $2,476 per month.

[^48]: These amounts are derived from Divorcemate Tools One calculations.

[^49]: ($2,525 x 8) + ($3,494 x 4).

[^50]: $14,856 + $7,000.

[^51]: For example, if CZ returns home and goes away to school in September 2021 but continues to reside with the mother during summer and school breaks the pro-rated payment over 12 months ($4,039 x 5) + ($2,476 x 7) = $37,527 is per year or $3,127 per month.