ENDORSEMENT

COURT FILE NO.: FC-20-1115

DATE: 2021-07-06

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Roberto Santaromita Villa, Applicant

-and-

Melanie Santaromita Villa, Respondent

BEFORE: Justice P MacEachern

COUNSEL: Kevin Kavanaugh, for the Applicant

Self-Represented, for the Respondent

HEARD: June 30, 2021 by videoconference

ENDORSEMENT

[1] This proceeding involves a claim for a divorce under the Divorce Act, corollary relief (spousal support) and claims with respect to property under the Family Law Act and Partition Act.

[2] The Applicant Husband brings a motion seeking:

a. An order for the sale of the jointly owned matrimonial home under the Partition Act, and related relief.

b. Leave to amend his pleadings to claim occupation rent.

[3] The Respondent Wife opposes the Applicant’s motion and brings her own cross-motion for spousal support, exclusive possession, alternative relief if the house is sold for reimbursement of expenses and with respect to the remaining proceedings of sale, and leave to amend her pleadings to include a claim for an unequal division of net family property and unjust enrichment.

[4] The parties were married on September 8, 2001. They separated on April 1, 2018. They do not have any children.

[5] This motion was originally scheduled on March 10, 2021.

Respondent’s Cross-Motion

[6] On June 22, 2021, the Applicant served her cross-motion, seeking alternative relief if the home is listed for sale (with respect to the proceeds of sale), temporary without prejudice spousal support of $1,000 per month, and an order requiring the Applicant to provide a business and income report.

[7] The Respondent’s cross-motion was served by email sent at 4:59:59 pm on Tuesday, June 22, 2021. Under Rule 6(11), service was therefore effective on Wednesday, June 23, 2021 because it was served after 4 pm on June 22, 2021.

[8] On Thursday, June 24, 2021, the Respondent served an amended cross-motion, changing the relief she sought to include exclusive possession of the matrimonial home, spousal support of “at least $1,000”, and leave to amend her pleadings to include a claim for unequal division of NFP and unjust enrichment. The Applicant’s affidavit of service does not state the time this amended notice of motion was served, nor does it attach the first page of the email message to confirm the time sent, which is not in accordance with the rules.

[9] The Applicant objects to the Respondent’s cross-motion being heard because it was not served at least six days before the motion, as required under the Family Law Rules (Rule 14(11)). The Rules require that the Respondent serve her notice of motion by June 22, 2021. Neither her original notice of motion nor amended motion were served by this date.

Respondent’s Request for an Adjournment

[10] At the outset of the motion, I denied the Respondent’s request to adjourn the Applicant’s motion and her cross-motion, for reasons given orally. These reasons include:

a. The Respondent has had ample opportunity to prepare for this motion, and to retain counsel if she wished, because the motion was originally scheduled on March 10, 2021;

b. The Applicant would be prejudiced by an adjournment because the next available motion dates are in the fall of 2021; and

c. I do not find the Applicant’s submission that she needed an adjournment because she was only notified at 5 pm the day before the motion that the lawyer she retained would not appear for her in court, to be credible. This is for several reasons, including:

i. The Applicant previously requested an adjournment for different reasons on June 8, 2021, which the Applicant refused;

ii. The record reflects that the Respondent has had legal advice in this matter for some time;

iii. The Respondent’s lawyer did not file a change of representation with the court, which committed themselves to appearing on this motion; and

iv. The Respondent’s interest in delaying the sale of the home.

Respondent’s Cross-Motion and Affidavits

[11] The Applicant objects to the Respondent’s cross-motion being heard, and her affidavit sworn June 24, 2021 being admitted, due to late filing and because the Applicant has not had an opportunity to respond.

[12] Although the Respondent’s motions were served late, I have reviewed her motion material, including notices of motion, and taken these into consideration in my disposition set out below. I also accepted the Respondent’s financial statement, sworn June 29, 2021, at the hearing of the motion, although this had not been previously filed with the court and had only been served on the Applicant the day before the motion.

Sale of the Matrimonial Home

[13] I am ordering the sale of the matrimonial home for the reasons that follow.

[14] The matrimonial home, located at 65 Chester Crescent, Nepean, Ontario is jointly owned.

[15] There is significant equity in the home. In her financial statement, the Respondent provides a current value for the home of $650,000. The encumbrances on the home total approximately $92,000. This is the main family asset.

[16] A joint owner of real property has a prima facie right to an Order for the sale of the property, unless to do so would be prejudicial to the other owner or would create hardship or injustice. See Martin v. Martin, 1992 7402 (ON CA), [1992] O.J. No. 656 (Ont. C.A.) and Silva v. Silva 1990 6718 (ON CA), [1990 CarswellOnt 319 (Ont. C.A.)], 1990 67180.

[17] In Martin, at para. 26, the Court of Appeal stated that an Order directing the sale of a matrimonial home before trial should only be made where the circumstances of the case make it appropriate in all the circumstances and that "before trial such orders are not granted as a matter of course".

[18] The Respondent has already benefitted from occupying the home since the parties’ separation on April 1, 2018

[19] The Respondent has worked as a legal assistant/law clerk. She reports income in 2020 totaling $49,364. Her financial statement sworn June 29, 2021 reports her current income as $38,712 per year, including spousal support and employment insurance. The Respondent reports, however, that she is working now in a contract position, continues to search for employment and has a job interview in the near future.

[20] The Applicant has been paying spousal support to the Respondent of $1,000 per month since June of 2020, and consents to an order that he continue to do so on a temporary without prejudice basis. This is the amount of spousal support that the Respondent seeks in her notice of motion (served late) and her amended notice of motion, although her amended notice of motion (served later) qualifies this to be a minimum amount.

[21] The Applicant consents to the Respondent receiving 50% of the proceeds of sale of the home, which will provide significant funds to the Respondent.

[22] The only argument advanced by the Respondent to delay the sale of the home is her position that selling the home at this time will leave her homeless, as she will not be able to afford alternative accommodations. I do not accept this submission. The Respondent will be receiving temporary spousal support and 50% of the proceeds from the sale. The evidence before me, that the Respondent does not deny, is that she has taken approximately $20,000 from the Applicant’s business account after separation, of which she has had use and has not repaid. The Applicant also has an ability to earn income. I find that the Applicant is financially capable of funding suitable alternative accommodations if the home is sold.

[23] The Respondent also argues that the market value of rent in Ottawa averages at $1,800, which she will not be able to afford. I also do not accept this submission. The Respondent has not provided any evidence in support of her assertion that monthly rent in Ottawa averages about $1,800, nor the source of her information. Her financial statement sworn June 29, 2021, reports that her current housing expenses in the matrimonial home total approximately $1,800 per month. The Respondent’s financial statement sworn September 25, 2020 reports that her total housing costs in the matrimonial home totaled approximately $2,120 per month. Even if I accept that market rent is $1,800 per month, neither of the Respondent’s financial statements support her assertion that she would not be able to afford this amount given her evidence that she pays a similar amount to stay in the matrimonial home.

[24] I find that the inevitable result at trial will be that the matrimonial home will be sold. The Respondent’s affidavit material supports this. The Respondent’s affidavit sworn June 22, 2021 states that she is not opposing the sale of the home. The Respondent’s affidavit sworn June 24, 2021 does not withdraw the Respondent’s evidence in her June 22, 2021 affidavit, but asserts that she “believes that the sale might prejudice [her] legal rights, and [she] would need more time to discuss the same with a lawyer.” Neither of her affidavits take the position that the home will not inevitably need to be sold.

[25] This matter is not currently on the trial list. The parties have not yet had a settlement conference. Given this, it is likely that a trial in this matter would not be heard until the spring of 2022, at the earliest.

[26] The Respondent has delayed in moving this matter forward. Although ordered to provide financial disclosure within 30 days by Justice Ryan Bell on January 13, 2021[GN(1] , the Respondent did not provide her updated sworn financial statement with supporting documents to the Applicant until the day before this motion. The Respondent acknowledges that she has still not provided bank statements that were ordered by Justice Ryan Bell.

[27] I do not find that the sale of the matrimonial home will prejudice the Respondent’s equalization claims. The evidence before me does not support that there will be an equalization payment owed to the Respondent because of the value of the Applicant’s business. The Applicant is a painter. The evidence before me supports that the Applicant’s business, which was operated as a sole proprietorship during the marriage, is personal in nature, based on his skill and personal relationships, and is not transferrable. I am not making a final determination of the value of the parties’ net families properties, which will be done at trial, but only finding that the Respondent has not established, on a balance of properties, that an equalization payment will be owed to her and which will be prejudiced by the sale of the home.

[28] I do not find that the sale of the matrimonial home prejudices the Respondent’s possession rights. The Respondent does not currently have exclusive possession of the home and only sought exclusive possession, three years after separation, in her amended motion served late on June 24, 2021.

[29] Section 24(3) of the Family Law Act sets out the criteria to consider when determining whether to make an order for the exclusive possession of the matrimonial home. The Respondent does not assert any factors in support of her claim for exclusive possession, other than her assertion that she cannot afford alternate accommodation and would therefore be homeless. For the same reasons given above, I do not find that the Respondent has met the onus on her to prove that she cannot find alternate, suitable and affordable accommodations if the home was sold. I have also considered the other factors under s.24(3), none of which support an order for exclusive possession being made. The Respondent’s motion for exclusive possession is dismissed.

[30] I do not find that the sale of the matrimonial home is prejudicial to the Respondent or would create hardship or injustice for her.

[31] In considering all the circumstances before me, I am ordering the sale of the matrimonial home. The sale of the home is the inevitable result at trial and there is no reason to further delay the sale. A further delay will only prejudice the Applicant and prolong this litigation.

[32] I am also ordering terms for the sale of the home, as sought by the Applicant in his notice of motion. I find these terms are fair and reasonable and provide a mechanism for the sale of the home to proceed.

Respondent’s Claim for Reimbursement of House Expenses

[33] If the house is sold, the Respondent seeks reimbursement of approximately $18,000 for mortgage payments, property taxes, home insurance, and a new dryer and alarm system.

[34] I am not ordering reimbursement of these expenses from the sale proceeds at this time. The determination of whether the Respondent is entitled to be reimbursed for these expenses, including whether such expenses are offset by the benefit she received from occupying the home, and issues related to whether there was a delay in listing the home for sale, are best determined at trial.

Proceeds of Sale

[35] The Applicant consents to the Respondent receiving 50% of the net proceeds of sale from the home, with him receiving the other half of the proceeds, subject to a small hold back if I order a valuation of his business. If I order a valuation of his business, he suggests hold back of $35,000 is more than enough to secure any amount that may be owed to the Respondent. In support, the Applicant has filed a Net Family Property Statement that calculates that the equalization payment owed to the Respondent is $22,150, which has been paid in full by the Respondent taking $20,000 from his business account and the transfer of her vehicle to her name.

[36] The Respondent seeks a hold back of $70,000 from the Applicant’s share. In support of this figure, she states that a sizable equalization payment is owed to her. However, the Applicant [GN(2] has not provided any evidence to support that a sizable equalization payment will be owed to her. She has not filed her own net family property statement or taken issue with any figures in the Applicant’s net family property statement, except to argue that his business is worth more. I deal with the issue of the value of the Applicant’s business more fully below. I find that the Applicant [GN(3] has not provided an evidentiary basis to support the value of the Applicant’s business being worth more than what he states in the net family property statement. I do not find that there is a basis to require a hold back of the Applicant’s share of the house proceeds to secure a potential equalization owed to the Respondent.

[37] I also do not find that it is reasonable or necessary to hold back a portion of the Applicant’s share of the sale proceeds as security for the Applicant’s [GN(4] claim for reimbursement for the house expenses. The Respondent’s evidence on this motion is that the market value of renting similar accommodations to the matrimonial home is $1,800 per month, which supports the Applicant’s position that the Respondent received a significant benefit from occupying the house, which should offset the expenses she paid in doing so. Again, I am not making a finding determination of the Respondent’s right to reimbursement – this will need to be determined at trial. However, I do not find that the Respondent’s claim to reimbursement is prejudiced by releasing the Applicant’s share of the sale proceeds to him.

Temporary Without Prejudice Spousal Support

[38] The Applicant consents to an order for him to pay temporary without prejudice spousal support to the Applicant of $1,000 per month.

[39] Both parties acknowledge this is the spousal support that has been paid since July of 2020, and I have therefore made the order below as of that date, with credit to the Applicant for the amounts that have been paid.

[40] I am not prepared to make an order for more spousal support to be paid at this time.

[41] There are several reasons for this, including that the Respondent’s original notice of motion and affidavit sworn June 22, 2021 only seeks spousal support of $1,000 per month. This is also the amount of interim spousal support sought by the Respondent in her oral submissions on this motion. In oral submissions, the Respondent sought $1,000 per month in interim spousal support, pending the Applicant providing further information about his current income through his corporation, which is dealt with below.

[42] The Respondent also failed to serve her sworn financial statements until the day before this motion, and she still owes outstanding disclosure. Much of the disclosure that has been provided was only provided the day before the motion, including, for example, her list of job searches.

[43] The Respondent’s amended notice of motion seeks spousal support of “at least $1,000 per month” but does not state the amount she seeks. In her affidavit sworn June 24, 2021, the Respondent states that she believes the Applicant has the ability to pay higher support and suggests the mid-range support payable if his income is $129,557 is $2,104 per month. This material was served late, and the Applicant has not had an opportunity to file an affidavit in response.

[44] In addition, the Respondent does not provide an evidentiary basis to support such an income being imputed to the Applicant at this time. She simply asserts that he unreasonably deducts expenses from his income and then suggests spousal support based on his gross revenue figures. The Applicant’s statement sworn June 24, 2021 includes a current income and expense statement for his business, which sets out his expenses.

[45] I do not find, on the evidence before me, that there is an evidentiary basis to impute additional income to the Applicant.

Business and Income Valuation

[46] The Respondent seeks an order requiring the Applicant to provide a valuation of his business and income for support purposes.

[47] I am not ordering the Applicant to provide a business valuation for the value of his business on the date of separation.

[48] The Applicant is required to provide evidence to establish the value of his business at the date of separation. I do not find, on the evidence before me, that this requires him to provide a business valuation. The Applicant is a painter. His business paints houses and commercial space. The Applicant has provided affidavit evidence that his business is personal in nature, reliant in his personal skills and relationships, and is not transferable. This evidence supports the value that the Applicant has provided for his business. The Respondent has not provided an evidentiary basis that supports me concluding that the evidence put forward by the Applicant is insufficient to establish the value of his business asset.

[49] With respect to an income report, the Applicant incorporated his business in May of 2020, after separation. The Applicant states that he incorporated for tax reasons, which supports my finding that the Applicant’s current income, which is relevant to spousal support, is not established simply by providing his personal income tax return and corporate financial statements. Additional information is required.

[50] Each party is obligated to make full and frank disclosure regarding their financial circumstances, that is relevant to the issues in dispute, and is reasonable, necessary and proportional. The Applicant’s obligation is to make full and frank proportional disclosure related to his income, so that his income for spousal support purposes can be determined, including any benefits that he may receive from his corporation though payments to non-arm’s length third parties, expenses deducted through the business, or tax savings.

[51] Because the Applicant has now incorporated for tax reasons and his current income is relevant to the Respondent’s claim for spousal support, I find that it is reasonable and proportional to require the Applicant to provide an income report from a qualified accountant, setting out his income for spousal support purpose for 2020, being the year in which he incorporated. In doing so, I have assumed that such a report can be prepared at a reasonable cost, such as a few thousand dollars. When I compare that cost to the cost of this litigation, the amounts in issue in this litigation, the proceeds that are expected from the sale of the matrimonial home, and the cost savings from having better evidence on the Applicant’s current income, I find that it is reasonable and proportional to make this order. If I am wrong, and such a report is prohibitively expensive, the issue of whether such a report is required can be returned before me.

Leave to Amend Pleadings

[52] Both parties seek to amend their pleadings and consent to the other doing so. The orders made below for these amendments are on consent.

Disposition

[53] For the above reason, I make the orders set out below.

Pursuant to the Partition Act

[54] The jointly owed matrimonial home located at 65 Chester Crescent will be listed for sale.

[55] No later than seventy-two hours after release of the Court’s endorsement, the Respondent will provide to the Applicant’s solicitor by email a list of three real estate agents to list the home for sale. Within twenty-four hours of receipt of the list, the Applicant, through his solicitor, will confirm, by email to the Respondent, the Applicant’s choice from the three agents. If the Applicant does not, for any reason, so confirm his choice of agent, the Respondent shall pick one of the three agents to list the home.

[56] If the Respondent does not provide a list of three agents to the Applicant within the stipulated time frame, the Applicant shall pick the agent, and the Applicant’s solicitor shall notify the Respondent through email.

[57] The agent chosen pursuant to 55. and 56. above shall be contacted by the party who chose the agent.

[58] No more than seven days after notification of choice of agent pursuant to 55. and 56. above, the parties shall sign a listing agreement with the agent chosen.

[59] The parties shall not be bound to accept the agent’s recommendations for repair, improvement, staging, etc. of the home, and shall only affect those items on which they mutually agree.

[60] The parties will list the home at the price recommended by the listing agent, and follow the listing agent’s recommendations with respect to showings, timing of offers, etc.

[61] The Respondent will maintain the home in a clean and show-ready appearance during the listing period and will make the home available for showings at the listing agent’s request, including upon short notice, being a minimum of 3 hours. [GN(5]

[62] Unless specifically recommended otherwise by the listing agent, or unless they both agree otherwise in writing, including by email[GN(6] , the parties shall accept the highest unconditional offer received within 48 hours of the date for acceptance of offers, as specified in the listing.

[63] The parties shall use a real estate lawyer recommended by the listing agent to complete the transaction.

[64] Upon completion of the sale, the net proceeds of sale after paying the encumbrances on title, the real estate fee, adjustments and the legal fees related to the sale, and any other amounts agreed on by both parties in writing, the balance of the net proceeds shall be equally divided between the parties.

[65] The issues of whether the Respondent is entitled to reimbursement respecting expenses she paid on the home, and the Applicant’s claim to occupation rent, shall be determined at trial.

Pursuant to the Divorce Act

[66] Commencing July 1, 2020, the Applicant shall pay temporary without prejudice spousal support to the Respondent of $1,000 per month.

[67] The Applicant has been paying spousal support to the Respondent of $1,000 per month since July 1, 2020, which amounts shall be credited to the above obligation.

Pursuant to the Family Law Rules

[68] Within 30 days, the Applicant may amend his Application to include a claim for occupation rent from the date of separation.

[69] Thereafter, within 30 days of being served with the Applicant’s Amended Application, the Respondent may serve her Amended Answer responding to the claim for occupation rent and including a claim for unequal division and unjust enrichment.

[70] The Applicant may then file a Reply within the time periods provided under the rules.

[71] The Respondent shall provide her outstanding disclosure, including the bank statements ordered by Justice Ryan Bell on January 13, 2021, as soon as possible and no later than 30 days from June 30, 2021.

[72] The Applicant shall provide an income report from a qualified accountant, setting out his income for spousal support purposes for the year 2020. For this purpose, within 30 days, the Applicant shall retain an accountant to prepare this report and provide confirmation to the Respondent that he has done so, and the expected completion date for the report.

Costs

[73] If the parties cannot agree on this motion's costs, the Applicant may file submissions concerning costs on or before July 16, 2021. The Respondent may file submissions concerning costs on or before July 23, 2021. Both parties' cost submissions shall be no more than three pages in length, plus any offers to settle and bills of costs, and shall be spaced one point five spaces apart, with no less than 12-point font.

Justice P MacEachern

Date: July 6, 2021

COURT FILE NO.: FC-20-1115

DATE: 2021-07-06

ONTARIO

SUPERIOR COURT OF JUSTICE

RE: Roberto Santaromita Villa, Applicant

-and-

Melanie Santaromita Villa, Respondent

BEFORE: Justice P MacEachern

COUNSEL: Kevin Kavanaugh, for the Applicant

Self-Represented, for the Respondent

ENDORSEMENT

Justice P MacEachern

Released: July 6, 2021

[GN(1]Possibly awkward structure. “Although ordered by Justice Ryan Bell to provide financial disclosure within 30 days of the decision made January 13, 2021,…”?

[GN(2]Respondent?

[GN(3]Respondent?

[GN(4]Respondent?

[GN(5]Parentheses ( ) instead of [ ] ?

[GN(6]Parentheses ( ) instead of [ ] ?