NEWMARKET COURT FILE NO.: FC-20-1353-00
DATE: 20210510
ONTARIO
SUPERIOR COURT OF JUSTICE
FAMILY COURT
BETWEEN:
Parmis Kargar Ghaleh Seifi
Applicant
– and –
Ehsan Rezaie Hanji, 2732596 Ontario Inc., Hanjani Commercial Group., 2732585 Ontario Inc., 277917 Ontario Inc., Hossein Rezaei Hanjani, and Taghi Aryafar
Respondents
Judy Piafsky, for the Applicant
Meysa Maleki and Sara Kun, for the Respondent Ehsan Rezaie Hanji
CJ.A Khanlarbig, for the Respondents 2732596 Ontario Inc., Hanjani Commercial Group., 2732585 Ontario Inc., 277917 Ontario Inc., and Hossein Rezaei Hanjani,
Esther Lenkinski, for the Respondent Taghi Aryafar
HEARD: March 30, 2021 - via videoconference
DECISION ON MOTION FOR CHILD AND SPOUSAL SUPPORT
Sutherland J.:
Overview
[1] The applicant/mother, Parmis Kargar Ghaleh Seifi (applicant or mother) has brought an amended motion seeking spousal and child support from the respondent/father, Ehsan Rezaie Hanji (respondent or father) along with the payment of his proportionate share for extraordinary expenses of the children and the obtaining life insurance to secure support in a face amount of not less then $4.1 million dollars. The applicant seeks spousal and child support based on an imputed annual income to the respondent in the amount 1.5 million dollars.
[2] The father opposes the amount requested as imputed annual income. The father does not oppose that he is obligated to pay child and spousal support. He argues that the best evidence before the Court on this motion is that his annual income is $146,655.50 and that the applicant does have income and her income, as she contends, is not zero.
[3] The other respondents did not participate in this motion. The issues in this motion did not concern them or their interest in this proceeding.
Background
[4] The applicant and respondent/father were married on July 25, 2015. They separated on January 25, 2020.
[5] The applicant was born December 11, 1980 (40 years of age) and the respondent/father was born May 23, 1983 (37 years of age).
[6] They have one child of the marriage, Aramiss Rezaei Hanjani (Aramiss) born June 9, 2015 (age five).
[7] The applicant commenced this application on October 23, 2020 and amended her application thereafter.
[8] The respondent filed his Answer dated January 29, 2021.
[9] The applicant is residing with her parents. Aramiss is residing with her.
[10] The respondent resides with his parents. He has parental time with his daughter, though he has not had overnight time with his daughter since July 2020.
[11] The parties have jointly held and separately held property and businesses. The property on Sarah Street has been sold. The Court was advised that $50,000 was disbursed to the applicant.
[12] In July 2020, the respondent/father was charged with numerous criminal offences relating to conduct including assault and choking perpetrated against the applicant. The respondent/father vehemently disputes theses charges.
[13] Neither party has provided an income report to the Court providing an expert opinion as to the respondent’s income. The respondent has provided an affidavit from Mr. Tim Martin of Duff & Phelps Canada Limited. Mr. Martin is a Chartered Professional Accountant. Mr. Martin deposes that the respondent’s income in 2020 from Farsi Catering only is $47,988 to $191,913. Mr. Martin deposes in his affidavit that he is in the process of completing an expert report on the income of the father. The respondent concedes that the income indicated in his Income Tax returns, line 150, does not represent his income for support purposes. His line 150 income for the years provided indicate: 2017 - $10,547; 2018 -$11,540; and, 2019 - $20,000.
Legal Framework - Support
Spousal Support
[14] On a temporary order for spousal support, the Court is governed by subsection 15.2(1) of the Divorce Act[^1] which grants the Court jurisdiction to make an order for spousal support, requiring one spouse to pay the other spouse either a lump sum or periodic sums, in the amount the Court thinks reasonable for the support of the other spouse. Subsection 15.2(2) provides the Court with authority to make a temporary order. Subsection 15.2(4) sets out factors which the Court is to consider on the needs and means of other circumstances of each spouse, and subsection 15.2(6) sets out objectives for spousal support.
[15] Further, in determining spousal support, I agree with the contextual approach as set out in Driscoll v. Driscoll[^2] and Robles v. Kuhn[^3].
[16] Principles the Court would examine in determining temporary spousal support motions include:
(a) The recipient’s needs of a payor’s ability to pay are seen as a greater significance;
(b) The interim Order would attempt to be sufficient to allow the recipient to continue living at a same standard of living prior to separation if the payor’s income ability to pay also allows it;
(c) The Court should not embark on an in-depth analysis of a party’s circumstances. This should be left to trial. At best, the Court achieves a form of rough justice;
(d) The Court would not over or unduly emphasize any one of the statutory conditions as set out above;
(e) The need to achieve self-sufficiency is often of less significance;
(f) The interim spousal support amount ordered be within the range as suggested by the Spousal Support Advisory Guidelines (“SSAG”) unless exceptional circumstances indicate a variance from those guidelines;
(g) Interim support may be ordered when it can be said a prima facie case for entitlement exists; and
(h) Whether there is a need to resolve uncontested issues of fact, especially those connected with the threshold question such as entitlement, it becomes less than advisable for a court to make an interim order for support.
[17] The above listed is not an exhaustive list but is an indication of what principles the Court should consider in determining spousal support on a contextual analysis.[^4]
[18] The Ontario Court of Appeal has further affirmed in Slongo v. Slongo[^5] that in assessing spousal support, the SSAG’s should not be easily departed from. At paragraph 105, the Court stated:
As already mentioned, the Guidelines, while not binding, should not be lightly departed from. This is in large part because, without them, it is very difficult to establish a principled basis for arriving at a figure for spousal support.
[19] Temporary spousal support is for a finite period of time to provide funds to the recipient for the recipient’s need until trial. At trial, the trial judge will have a full evidentiary record before him or her to ascertain much better the financial realities for both parents flowing from the end of their marriage. The trial judge will have the division of property and the quantum of any equalization payment. If the recipient is granted an equalization payment, the amount of that payment may have an effect on the quantum and duration of any spousal support order the Court may make. Thus, the determination of the quantum of spousal support on a motion is “rough justice”.
[20] The need that the recipient spouse may require is not just the bare minimum to survive.[^6] The amount should attempt to reflect the standard of living of the parties before separation with the reality that there is an increase in living expenses given that the same family income may now have to pay for two households.[^7]
Child Support
[21] Sections 15.1(1), (2), (3) and (4) of the Divorce Act govern child support in a marriage breakdown and states:
Child Support Order
15.1 (1) A court of competent jurisdiction may, on application by either or both spouses, make an order requiring a spouse to pay for the support of any or all children of the marriage.
Interim Order
(2) Where an application is made under subsection (1), the Court may, on application by either or both spouses, make an interim order requiring a spouse to pay for the support of any or all children of the marriage, pending the determination of the application under subsection (1).
Guidelines Apply
(3) A court making an order under subsection (1) or an interim order under subsection (2) shall do so in accordance with the applicable guidelines.
Terms and Conditions
(4) The Court may make an order under subsection (1) or an interim order under subsection (2) for a definite or indefinite period or until a specified event occurs, and may impose terms, conditions or restrictions in connection with the order or interim order as it thinks fit and just.
[22] The Child Support Guidelines indicate the means and process for the calculation of child support. The Child Support Guidelines are mandatory.
[23] Section 16 of the Child Support Guidelines indicates that in the calculation of annual income for the purpose of child support, a spouse’s annual income is determined by using the income set out under the heading “Total Income” in the person’s T1 General tax return.
[24] Section 17 of the Child Support Guidelines deals with situations where there is a pattern of income over the last three years consisting of fluctuations in income.
[25] Section 18 of the Child Support Guidelines deals with shareholders, directors and officers.
[26] Section 19 of the Child Support Guidelines permits the Court to impute income to a parent or spouse.
Imputation of Income and Temporary Orders
[27] Section 19 of the Child Support Guidelines permits the Court to impute income where:
(a) the parent or spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of any child or by the reasonable educational or health needs of the parent or spouse;
(f) the parent or spouse has failed to provide income information when under a legal obligation to do so.
[28] Section 17, 18 and 19 of the Child Support Guidelines are methods by which the Court can give effect to the joint and ongoing obligation of parents to support their children. In order to meet this obligation, the parties must earn what they are capable of earning. If they fail to do so, they will be found out to be intentionally under-employed, as set out in subsection 1(a) of section 19 of the Child Support Guidelines. This section is perceived to be a test of what is reasonable and fair for support. The Ontario Court of Appeal in Drygala v. Pauli[^8], has set out a three-part test to determine whether a payer is intentionally under-employed or unemployed.
[29] The first part of the test is to ask whether the payer is intentionally under-employed or unemployed. There is no need for specific intent to avoid child support obligations before income is imputed. The payer is intentionally under-employed if he or she chooses to earn less than what he or she is capable of earning. The Court must look at whether the act is voluntary or unreasonable.
[30] The second part of the test is, “if the payer is intentionally under-employed, is this by virtue of his or her reasonable educational needs, the needs of the child of the marriage or reasonable health needs?”
[31] Once under-employment or unemployment is established, the onus shifts to the payer to prove one of the exceptions of reasonableness. Parents can take jobs with less money as long as the decision is reasonable. A parent cannot be excused from his or her obligation in furtherance of unrealistic career aspirations. As a general rule, a parent cannot avoid child support obligations by a self-induced reduction of income.[^9]
[32] The third part of the test in Drygala v. Pauli is, “if there is no reasonable excuse for the payer’s under-employment, what income should properly be imputed in the circumstances?” The Court must have regard to the payer’s capacity to earn income in light of such factors as employment history, age, education, skills, health, available employment opportunities, and a standard of living earned during the parents’ relationship. The Court looks at the amount of income the payer could earn if he or she worked to capacity.[^10]
[33] In addition, where the under-employment or unemployment is the result of one’s own actions (an event over which the payer had some control) or misconduct, the support obligation will not be reduced or cancelled. The consequence of a payer’s action should be borne by the payer and not by the payer’s dependents.[^11]
[34] Needless to say, financial disclosure is critical. As in any family law case, financial disclosure is the underpinning of family law litigation and failure to provide financial disclosure will infect all aspects of a family law proceeding. The failure of a party to provide any financial disclosure or timely financial disclosure is a factor the Court may take into consideration in ascertaining a parties’ income for support. The Court may make a negative inference against the party who fails to provide any or timely financial disclosure.[^12]
[35] There is no question that the onus is on the applicant to provide an evidentiary basis for the Court to impute income to the respondent. This burden is not displaced due to the failure of the payor spouse to provide any or timely financial disclosure.[^13] The spouse requesting an imputation of income is still required to provide a factual foundation for the imputation and the amount of income requested.
What is the Income of the Applicant and Respondent?
Position of the Parties
[36] The applicant argues that the respondent’s annual income is 1.5 million dollars based on[^14]:
(a) A text message found at Exhibit “G” of the applicant’s affidavit dated January 7, 2021 where the respondent states: …: “you have to be willing to have a different life style cause I’ve done my numbers amount 1.5 mill is my payout and the past 4-5 years every year we made an investment to added something to our life so technically I have to earn 1.5 mill minimum for us to keep our heads above water and if we wanna make investments and grow at the same time…”;
(b) The respondent has bank accounts, a RBC visa card and TD Access Cards that he has not disclosed;
(c) Withdrawals from bank accounts for loans where there is no indication in his financial statements of these debts;
(d) Failure to list assets on his financial statements such as vehicles;
(e) Income from weekly poker games;
(f) Several cannabis businesses that the respondent is involved in;
(g) Cash envelopes showing amounts of $522,069;
(h) Failure of debt increasing as indicated in his financial statements dated January 29, 2021 and February 11, 2021, after monies paid per Court Order;
(i) A text message indicating that personal bills and expenses are about $55,000 (55K).[^15]
[37] The applicant argues that there is such a lack of financial information by the respondent and much contradictory information of the respondent, that the Court cannot rely on the evidence of the respondent. The Court must accept the respondent’s information in text messages to the applicant that indicates personal expenses of $55,000 or that he must earn 1.5 million dollars a year. As for her income, the applicant deposes that she has no income. The most she has made per year is $40,000. She has in the past made less than $30,000 per year. She is a stay at home mother. She has worked in her father’s accounting business but has not earned more than $30,00 per year.
[38] The respondent, as indicated previously, does not dispute that his income in his Income Tax return does not indicate his income for support purposes. He contends that his income for support purposes is $146, 655.50 per year.
[39] He directs the Court to the Affidavit of Mr. Martin that indicates his income from the records that Mr. Martin has reviewed indicate an annual income for support. Though, this report is not an opinion, but a brief indication given the information provided.
[40] The respondent also states that the applicant’s father is his and the applicant’s accountant. The applicant’s father and she are aware of his financial situation. The respondent also deposes that he has not been able to obtain his financial records from the applicant’s father, though he has requested such information numerous times. The respondent deposes that he is not withholding financial information and is unable to provide the information due to the conduct of the applicant’s father. An affidavit from the applicant’s father has not been provided for this motion.
[41] The respondent further directs the Court to the applicant’s initial notice of motion wherein she requested an imputed income of $550,000. He contends that he does not earn anywhere near $550,000, not to mention 1.5 million. He argues that the applicant has the onus of providing evidence that support an imputation of income of 1.5 million dollars. The applicant, he contends, has failed to meet the onus. The applicant’s evidence is not evidence but speculation. He further reminds the Court that Canada, like the rest of the world, are in the middle of a pandemic. This pandemic has been disastrous on certain businesses, particularly business in entertainment, such as restaurants. He reminds the Court that his businesses of food have been hit hard by the pandemic and he has had to shift business to that of take out. The cannabis businesses are in the process of opening and have not been engaged in business that long. Lastly, he argues that the applicant has income that she has not disclosed. He argues that in January 2020, the applicant had deposits of $12,663.28 from monies earned through the Airbnb’s; not to mention the monies that the respondent has paid to the applicant pursuant to Orders of this Court.
[42] Accordingly, the respondent argues that the quantum of child and spousal support should be based on an income of $145,655.50 with income attributed to the applicant. He should be given credit for monies made to the applicant per previous court orders.
Analysis
[43] The onus is on the applicant to provide evidence that supports a finding of the Court that, on a temporary basis, the respondent’s imputed income is 1.5 million dollars.
[44] There is no dispute that the respondent’s income for support purposes is not what is set out in his Income Tax returns. The question becomes what is his income for temporary support?
[45] The Court is not persuaded from the evidence provided by the applicant on this motion that the respondent’s income is 1.5 million dollars. At best, for this motion, the applicant’s assertions are speculation. The Court does not put much weight on the text messages of the respondent to prove that his income for support is 1.5 million dollars. The text messages do not convey that the respondent’s income for support purposes is 1.5 million dollars. The text messages presented can also indicate, at the time the messages were sent, that the respondent may have an overall business income of 1.5 million dollars to keep the businesses and properties afloat.
[46] In addition, the pandemic has affected the businesses and Airbnb rentals. There is no dispute in fact between the applicant and the respondent that the pandemic has negatively affected the restaurant businesses and the rental of properties. So, the Court is not persuaded that even if the respondent’s income is 1.5 million dollars given the text messages, that his income is the same at the time of this motion given the pandemic.
[47] In reviewing the financial statements of the parties, the living expenses indicated are as follows:
(a) The applicant:
November 16, 2020 - monthly expenses - $21,352 - yearly - $256,224;
January 2, 2021 - monthly expenses - $24,007.47 - yearly - $288,090.84.
(b) The respondent:
January 29, 2021 - monthly expenses - $15,533.99 - yearly - $186,407.88.
[48] The applicant has expenses set forth that the Court does not take into consideration on this motion. These include legal fees, vacation, property insurance, mortgage, landscaping and snow removal, car repairs, parking, the respondent’s vehicle, hair care, entertainment/recreation, school fees (a Section 7 expense). If the Court removes these expenses, the monthly amount comes closer to the monthly amounts deposed by the respondent.
[49] The living expenses indicated by the respondent include expenses for the family. In Part 5 - Debts and Other Obligations in the respondent’s financial statement filed, it indicates that the respondent has increased his debt from the debt of separation by $411,000, being a loan from Mr. Taghu Aryafar. The reasons and specifics of the increase in the loan debt has not been revealed. A cheque from respondent’s mother was provided in the amount of $14,000 to assist the respondent in paying the support ordered by the Court. The respondent deposes that he “will have to continue borrowing funds to pay support and meet expenses.”[^16] The Court is aware that the Sarah property has been sold and there is no expense related to that property.
[50] In contrast, the applicant has not provided in her evidence a clear indication of income she has received from one of the Airbnb’s in 2020. There appears to be no question that the applicant did receive monies. It appears that the applicant has received substantial income in 2020, over $100,000. But what is not apparent from the evidence provided on this motion is what proportion of the income did the applicant receive after deducting carrying costs for the Airbnb property.
[51] Needless to say, the quality of financial information at this stage is not ideal. There are many questions that remain outstanding to determine the income of both the applicant and the respondent. Further financial disclosure is required with any expert income reports provided and probably questioning.
[52] At the motion stage, there is an element of “rough justice” that the Court must partake in to ascertain an income of both the applicant and respondent for support purposes.
[53] The best evidence the Court has is the living expenses indicated in the sworn financial statements provided by both parties keeping in mind the pandemic and that the family is no longer living under one roof. The Court is aware that the respondent may be increasing debt to pay for expenses for the family and his business. Without the specifics of the debt and where the funds from the debt were allocated, it is difficult for the Court to determine that the debt incurred was actually incurred and for what purpose. In affect, what specific expenses did the loaned money pay? Were the funds used for living expenses or for something else, like business investments?
[54] This leaves the Court with the dilemma of fixing income with less than ideal evidentiary records where both parties agree child and spousal support should be paid.
[55] The Court has come to a conclusion in rough justice that the reasonable income of the respondent, given the living expenses indicated is $285,000. This is roughly calculated using a monthly living expenses amount of $17,500 which is grossed up for taxes by 35%.
[56] For the applicant, the Court is not convinced that for 2021 that income should be attributed to her. Given the pandemic and the evidence provided, the Court is not persuaded that the applicant could earn an income with a small child at home.
Spousal Support
[57] Thus, the respondent should pay spousal support to the applicant based on his yearly income of $285,000 and no income to the applicant. For the calculation of spousal support, using the SSAGs, is low end $6,474, mid range $7,201 and high end $7,949. In the circumstances for this motion, the Court concludes that the mid range is applicable. The calculation for spousal support is $ 7,201 per month.
Child Support and Section 7 Expenses.
[58] For child support, using the Child Support Guidelines for one child with an annual income of $285,000, the monthly amount is $2,271. No particulars have been provided for Section 7 expenses. Accordingly, I adjourn the issue of Section 7 expenses to be adjudicated later.
Commencement Date
[59] The applicant requests that the commencement date for support be the date of separation. The Court is not convinced that the commencement date should be the date of separation. There are far too many unknowns concerning the financial situation of the applicant and respondent. The respondent did receive payment toward support as ordered by the Court for January and February 2021 of $24,000 and $12,000. The applicant also did receive income from an Airbnb in 2020. With a fuller evidentiary record, the trial judge will be better suited to determine a more evidentiary conclusion on income of the applicant and respondent taking into consideration any equalization payment to be paid.
[60] Hence, due to the amounts ordered and paid by the respondent, the Court orders that the support payments herein commence April 1, 2021.
Life Insurance as Security for Support
[61] The applicant argues that the Court has jurisdiction to make an order that the respondent obtain life insurance and request such an order that the respondent obtain life insurance in the amount of 4.1 million dollars. The applicant directs the Court to the Ontario Court of Appeal decision in Katz v. Katz.[^17]
[62] In Katz, the Court of Appeal reviewed section 34(1) of the Family Law Act. Section 34 (1) (i) indicates that under an application for support under section 33, a Court may make an interim order “requiring that a spouse who has a policy of life insurance as defined under the Insurance Act designate the other spouse or a child as the beneficiary irrevocably.”
[63] Though the Court of Appeal did indicate that under section 34(1)(k), the Court has broad discretion to order a spouse to obtain an insurance policy to secure payment of a support order. The Court of Appeal also indicated that no such provision is in the Divorce Act.
[64] On this motion, there was no evidence provided that the respondent has an existing policy of insurance. In his financial statement, the respondent does not indicate that he is paying for an existing policy of life insurance. In the applicant’s financial statement there is no indication that life insurance is being paid on the life of the respondent.
[65] Furthermore, there was no evidence provided that the respondent qualifies for life insurance and the premium amount of such a policy of life insurance.
[66] Given the lack of evidence, the Court is not inclined to grant the order requested concerning a policy of life insurance.
Disposition
[67] The temporary Order is as follows:
(a) The respondent shall pay a monthly amount of spousal support to the applicant in the amount of $7,201 commencing April 1, 2021;
(b) The respondent shall pay a monthly amount of child support for the child in the amount of $ 2,271 commencing April 1, 2021;
(c) The respondent will continue to pay the second mortgage on 188 Spadina Avenue TH4 Toronto, as long as the applicant and/or respondent have an interest in said property.
(d) The issue of Section 7 expenses is adjourned sine die returnable on 14 day’s notice.
(e) The request for life insurance is dismissed.
(f) SDO to issue.
[68] If the parties cannot agree on costs, then the applicant is to serve and file her written submissions for costs within 14 days from the date of this decision, and the respondent will have 14 days thereafter to serve and file his submissions. There is no right for any reply submissions. The submissions are to be no more than three pages, double-spaced, exclusive of any costs outline, case law and offers to settle. Submissions are to be filed with the Court. If no submissions are received within the time period set out herein, an order will be made that there will be no costs.
Justice P.W. Sutherland
Released: May 10, 2021
[^1]: R.S.C. 1985, c 3 (2nd Supp) [^2]: 2009 CarswellOnt 793 [^3]: 2009 BCSC 1163, [2009] BCJ No. 1699 [^4]: Supra, footnotes 1 and 3; Charbonneau v. Charbonneau, 2014 CarswellOnt 5211 (SCJ); Pitchforth v. Pitchforth, 2009 CarswellOnt 4866 (SCJ) [^5]: 2017 ONCA 272, para. 105 [^6]: Lebovic v. Lebovic, 2001 CarswellOnt 1160; Riad v. Riad, 2002 ABCA 254; Billings v. Billings, 2004 CarswellOnt 295 (SCJ) [^7]: Marinangeli v. Marinangeli, 2003 CarswellOnt 2692 (CA)., para. 74 [^8]: 2002 CanLII 41868 (ON CA), [2002] O.J. No. 3731. [^9]: Hanson v. Hanson, 1999 CanLII 6307, Depace v. Michienzi, 2000 CanLII 22560 (ON SC), [2000] O.J. No. 453 (Ont. Fam. Ct.), and Gobin v. Gobin, 2009 ONCJ 245, [2009] O.J. No. 2191 (OCJ). [^10]: Lawson v. Lawson, 2006 CanLII 26573 (ONCA). [^11]: Maurucci v. Maurucci, 2001, CarswellOnt 4349 (SCJ), Sherwood v. Sherwood, (2006) 2006 CanLII 40795 (ON SC), O.J. No. 4860 (SCJ), and Aboagye v. Sakyi, [2002] O.J. No. 575 (OCJ); Lindeman v. Deloges 2020 CarswellOnt 579 (OCJ) paras. 29-31. [^12]: Pustai v. Pustai 2018 CarswellOnt 22491 (CA); Leitch v. Novac 2020 CarswellOnt 5201 (CA), leave to appeal dismissed, 2020 CarswellOnt 16731 (SCC). [^13]: Dunford v. Hamel 2018 ONSC 3427, at para. 52. [^14]: Much of this is summarized in the applicant’s affidavit dated February 16, 2021. [^15]: Paragraph 17, Exhibit “G” affidavit of the applicant dated January 7, 2021. [^16]: Affidavit dated February 5, 2021, at para 72. [^17]: 2014 CarswellOnt 11375 (CA), at paras 66-74.
NEWMARKET COURT FILE NO.: FC-20-1353-00
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Parmis Kargar Ghaleh Seifi
Applicant
– and –
Ehsan Rezaie Hanji, 2732596 Ontario Inc., Hanjani Commercial Group., 2732585 Ontario Inc., 277917 Ontario Inc., Hossein Rezaei Hanjani, and Taghi Aryafarq
Respondents
DECISION ON MOTION FOR CHILD AND SPOUSAL SUPPORT
Justice P.W. Sutherland
Released: May 10, 2021