COURT FILE NO.: FC-17-1336

DATE: 2021/11/29

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

CAROL JEAN WANT

Applicant

– and –

PIERRE ANTOINE GAUTHIER

Respondent

Richard Bowles, Counsel for the Applicant

John E. Summers, Counsel for the Respondent

HEARD: October 4, 6, and 7, 2021 via teleconference

REASONS FOR JUDGMENT

Justice A. Doyle

[1] The main issue in this trial is whether the wife is entitled to spousal support based on the husband’s income from Shopify which represents a substantial increase in income since the parties’ separation.

[2] The parties had a 22 year relationship and have one child who was 20 years old when the parties separated in 2014.

[3] The wife is on long-term disability and her annual income is $30,000 and the husband’s annual income is $250,800.

[4] The wife indicates that all of the husband’s increased post-separation income should be considered in the determination of spousal support and requests spousal support of $8,071 per month with a review when the husband retires, no earlier than his 65th birthday.

[5] The husband argues that none of his increased post-separation income should be considered in the determination of spousal support. Spousal support should be set at $1,559 per month and end when the rollover from his pension to the wife is completed.

[6] A second issue for the court’s determination is whether the parties’ residence at the time of separation should be included in the wife’s net family property, thereby impacting the equalization payment owing to her.

[7] For the reasons set out below, I order the following:

i. The husband will pay to the wife the amount of $189,470.96 as an equalization payment which will be paid by way of a rollover from the husband’s superannuation pension grossed up by a ratio of 1.14 to account for the tax payable by the wife. The parties will execute all documents necessary to effect this transfer;

ii. Commencing January 1, 2021, the husband will pay to the wife spousal support in the amount of $3,800 per month until the completion of the pension rollover. This amount is determined by using the husband’s pension income and 35% of his other earned income;

iii. Using the above formula, the parties will discuss the adjustment of spousal support for 2017-2020 inclusive, taking into account tax issues;

iv. If the parties cannot agree on the adjustment of retroactive spousal support within 30 days from the release of this decision, they are to arrange a hearing before me through the trial coordinator’s office. At the hearing, the parties are directed to provide the court with their submissions on the adjustment of retroactive spousal support and an outline of costs;

v. Commencing on the first day of the month following the pension rollover, subject to my findings below, there will be a review of spousal support paid; and

vi. Spousal support will be suspended and reviewed at the time of the husband’s retirement, which will not occur before he attains the age of 65.

Background

[8] The wife, who is 61 years of age, is in receipt of long-term disability from Carleton University since 2008 and her annual income is $30,000. She suffers from a number of ailments including chronic depression, attention deficit disorder, hypothyroidism, sleep apnea and diabetes, as described in Dr. Ruth Biggar’s letter dated February 21, 2018. Dr. Biggar’s letter dated April 17, 2020, confirmed that the wife’s mental health status had not changed.

[9] The husband is 63 years old. He is in receipt of a pension income from the Government of Canada and is working full time with Shopify. His current annual income is $250,800 consisting of:

i. $72,000 in pension income;

ii. $144,000 in employment income from Shopify;

iii. $10,800 in self-employment income; and

iv. $24,000 in other income.

[10] The parties cohabited from September 1992 and married on February 28, 1997. They have one child, Eric, born November 10, 1994. After the parties’ separation on April 1, 2014, Eric remained with the wife.

[11] At the time of the separation, the parties were living at 118 Fraser Fields Way in Ottawa (“the home”) which was owned by the wife’s father, Leonard Want, who was also residing in the home.

[12] The husband moved out the home on October 1, 2014.

[13] The home had been purchased by Mr. Want on June 14, 2012 for the sum of $357,925. Mr. Want paid the down payment and there was a mortgage registered in Mr. Want’s name in the amount of $300,000, which was secured against title. Until the parties separated two years later, the parties made the mortgage payments and paid the carrying costs and Mr. Want paid them a monthly amount.

[14] Mr. Want passed away on June 8, 2014 and his estate was divided equally between the wife and her sister. As part of the distribution of the estate, the home was sold on November 30, 2018, and the total net sale proceeds of $90,977.00 were paid to the wife.

[15] At the time of the commencement of the parties’ cohabitation, the wife was working as an administrative assistant at Carleton University. She worked in various departments and took a one-year maternity leave when Eric was born.

[16] During the marriage, the husband worked with the federal government for Statistics Canada, first working with the census and then at the School of Public Service. In 2009, the husband became a certified Integral Master Coach and in 2010 began facilitating a management development program for public servants for a company called The Leadership Group.

[17] The husband worked at the federal government until his retirement on October 13, 2013. He started coaching at Shopify in 2013. On March 1, 2014, the work with Shopify was billed through his corporation 8759740 Canada Inc. He would coach individuals and teams within Shopify, and work with the Talent Acceleration program development and maintenance, which included training and coaching methods. He would also facilitate and engaged in other duties.

[18] On January 1, 2017, as required by Shopify, he became a full-time employee with Shopify.

[19] The parties’ respective Line 150 incomes, exclusive of spousal support paid and received from 2017 to 2021, are the following:

• The wife’s main source of income is her taxable Long-Term Disability Payment:

2017: $30,684

2018: $30,684

2019: $30,684

2020: $30,684 + $14,000 Canada Emergency Response Benefit (CERB: financial support provided to individuals and distributed by the federal government due to the COVID pandemic and its consequential negative effect on employment and business)

2021: $30,684.

• The husband’s income is derived from various sources (pension of approximately $70,000 and the balance from salary and other income) and is depicted below:

2017: $191,687

2018: $230,638

2019: $242,687

2020: $323,302

2021: $250,800 (as projected in his financial statement).

[20] The husband provided the following support to the wife:

i. Between April and September 2014, the husband paid the household bills estimated at $2,500 per month;

ii. After the husband left the home, he paid the wife $2,300 per month on a tax-free basis;

iii. At the case conference held on November 24, 2017, the support amount of $2,300 per month was ordered plus an additional $2,500 per month from December 2017 to February 2018; and

iv. The husband continues to pay spousal support in the amount of $2,300 per month.

Divorce

[21] The court grants a divorce on the basis of a one-year separation and that there is no reasonable prospect of reconciliation. A divorce order will be issued.

Issues

[22] The issues for my determination are:

1. Did the wife have a resulting interest in the home that the parties were residing in at the date of separation?

2. Is the wife entitled to spousal support based on a compensatory basis?

3. What is the husband’s income for the purposes of determining spousal support?

4. Is the wife entitled to an adjustment to the amount of spousal support paid by the husband from 2017 to today?

5. Is the wife entitled to double recovery or “double dip” (i.e. receive support based on the husband’s pension income once it has been divided at source even though it has already been included in the division of net family properties)?

6. When should spousal support terminate?

Issue #1: Did the wife have a resulting interest in the home that the parties were residing in at the date of separation?

Introduction

[23] The parties agree that the equalization payment owed by the husband to the wife will be satisfied by way of pension rollover from the husband’s Government of Canada superannuation pension plus a gross-up of 1.14 to account for taxes that the wife will ultimately pay when she is in receipt of the pension income.

[24] The wife indicates that the equalization payment owed by the husband to her is $189,470.96 while the husband indicates the equalization payment should be $144,076.60.

[25] The difference in their positions rests on whether the sale proceeds from the home should be included in the wife’s net family property.

[26] The wife submits that the home was her father’s home - there was never any intention that she was the beneficial owner of the home. Rather, the wife’s father, Mr. Want, and his wife were living in a senior residence when his wife passed away and he wanted to have his own place. He paid the down payment of over $50,000 and made capital improvements.

[27] The parties, who had undergone a Division 1 proposal with creditors, agreed that they could save on rent if they lived with Mr. Want.

[28] Mr. Want’s will indicated that his estate would be divided equally between the wife and her sister and there was no specific bequest that the home would be bequeathed to the wife.

[29] On the other hand, the husband submits that it was the intention of the parties and Mr. Want that the wife would have an interest in the home and to that end they paid the operating costs of the home, including the mortgage, realty taxes, insurance and utilities. It was Mr. Want’s intention that the wife would receive the home when he passed. Consequently, the wife had a resulting trust interest in the home at the date of separation and the sale proceeds of approximately $90,000 must be included in her net family property.

Legal Principles

[30] In Kerr v. Baranow, 2011 SCC 10, [2011] 1 S.C.R. 269, the Supreme Court of Canada laid out the basic principles of resulting trust:

[17] Resulting trusts arising from gratuitous transfers are the ones relevant to domestic situations. The traditional view was they arose in two types of situations: the gratuitous transfer of property from one partner to the other, and the joint contribution by two partners to the acquisition of property, title to which is in the name of only one of them. In either case, the transfer is gratuitous, in the first case because there was no consideration for the transfer of the property, and in the second case because there was no consideration for the contribution to the acquisition of the property.

[18] The Court’s most recent decision in relation to resulting trusts is consistent with the view that, in these gratuitous transfer situations, the actual intention of the grantor is the governing consideration: Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at paras. 43-44. As Rothstein J. noted at para. 44 of Pecore, where a gratuitous transfer is being challenged, “[t]he trial judge will commence his or her inquiry with the applicable presumption and will weigh all of the evidence in an attempt to ascertain, on a balance of probabilities, the transferor’s actual intention” (emphasis added).

[20] The presumption of resulting trust, however, is neither universal nor irrebuttable. So, for example, in the case of transfers between persons in certain relationships (such as from a parent to a minor child), a presumption of advancement — that is, a presumption that the grantor intended to make a gift — rather than a presumption of resulting trust applies: see Pecore, at paras. 27-41. The presumption of advancement traditionally applied to grants from husband to wife, but the presumption of resulting trust traditionally applied to grants from wife to husband. Whether the application of the presumption of advancement applies to unmarried couples may be more controversial: Oosterhoff, at pp. 681-82. Although the trial judge in Kerr touched on this issue, neither party relies on the presumption of advancement and I need say nothing further about it.

[31] In other words, a resulting trust exists when a party makes a financial contribution to the initial purchase of a property, but then gratuitously transfers their title (i.e. transfers their title for nothing in return) to the other party, with the intention that the transferee holds the transferor’s title for the transferor’s benefit.

[32] It occurs when one party contributes to the purchase of the property but then transfers their interest in the property to the other party for them to hold “in trust” for the transferring party. See paras. 16-19 in Kerr v. Baranow.

[33] In Oudeh v. Prior-Oudeh, 2021 ONSC 3718, 70 E.T.R. (4th) 286, the court described resulting trusts and equitable principles:

[21] Equity recognizes a distinction between legal and beneficial ownership. The beneficial owner of property has been described as "[t]he real owner of property even though it is in someone else's name": Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at para. 4, quoting Csak v. Aumon (1990), 1990 8070 (ON SC), 69 D.L.R. (4th) 567 (Ont. H.C.J.), at p. 570. Where a party holds title to a property but does not have a beneficial interest in that property, it does not form part of that party's net family property for equalization purposes. In Dhillon v. Dhillon, 2014 ONSC 5608, at para. 87, André J. refused to include real estate in India belonging to the husband's mother despite the husband being the sole person registered on title.

[22] In family law proceedings, courts have routinely imposed trusts where it would be inequitable to treat the registered owner of a property as the true owner just because it is held in their name.

Decision

[34] For the reasons that follow, I find that the wife did not have a resulting trust interest in the home.

[35] The property was in Mr. Want’s name. It was never transferred to the wife. Instead, the husband argues that although the father was the legal title owner, the beneficial owner was the wife. There is a paucity of evidence to support this position.

[36] I will deal with the following:

i. Mr. Want’s intentions;

ii. The purchase of the home; and

iii. The carrying costs of the home.

Mr. Want’s Intentions

[37] For the reasons that follow, I do not find that Mr. Want had an intention to create a resulting trust of the home to the wife. The intention of Mr. Want is the only relevant intention that the court must examine. See MacIntyre v. Winter 2021 ONCA 516.

[38] First, as described above, resulting trusts in family law cases usually occur in different circumstances, i.e. the gratuitous transfer of property from one partner to the other, and the joint contribution by two partners to the acquisition of property, title to which is in the name of only one of them. In these gratuitous transfer situations, the actual intention of the grantor is the governing consideration.

[39] The evidence establishes that at the time of the passing of the wife’s mother, the mother and Mr. Want were in a residence. After the mother passed away, the parties discussed with Mr. Want the option of him buying a home and the parties residing with him.

[40] In this way, Mr. Want would have the assistance of his daughter, the wife. He was in a position to buy a home, and in this way, he could provide the parties with a place to live.

[41] A factor that could be considered in support of the husband’s position is that they did it this way as they were not credit worthy and could not obtain a mortgage.

[42] The husband did not lead any other evidence with respect to the intentions of Mr. Want.

[43] If Mr. Want had the intention that the wife be the beneficial owner of the property, then he would have bequeathed the home to her in his will. There was no other documentary evidence that rebuts this finding.

[44] As further discussed below, Mr. Want’s intention that the home was his home is also manifested by the fact that he paid the complete down payment, placed title in his name, continued to make monthly payments and made capital cost improvements.

Acquisition of the Home

[45] Mr. Want and the wife in these proceedings wanted to be together so she could assist her father. The parties were unable to buy a home or arrange financing due to their previous Division 1 proposal.

[46] Mr. Want paid the full down payment of over $50,000, and the title as well as the mortgage was in his name alone.

[47] The father purchased the home and, although it is true that the parties could not purchase a home due to their insolvency status and Division 1 proposal, there is no evidence that he bought it for the wife.

[48] I accept the wife’s evidence on this point. It is reasonable that Mr. Want, who was footing the total cost of the acquisition of the home, would place the home in his own name.

[49] It is reasonable for a father to want to provide a home for his daughter, her spouse and grandchild and seek to have others to live with him when he had just become a widower.

Carrying Costs of the Home

[50] During the cohabitation from September 2012 to the time that the husband moved out in the Fall of 2014, the parties paid for the mortgage, taxes, insurance and utilities.

[51] Their payments were over a two-year period. It is not reasonable for two years’ worth of payments to entitle the wife to a resulting interest in the home.

[52] The father paid them a monthly amount to contribute to the household and he paid for renovations, including the fence and shed.

[53] The parties, in living there, agreed to pay for carrying costs, which they did for less than two years until the husband left the home in the Fall of 2014.

[54] There was no evidence that the parties had paid for any capital improvements or renovations to the home.

[55] There is no logic that by the fact that the parties paying some of the carrying costs, the wife became an owner.

[56] The evidence does not establish that there was an intention that the wife would have an interest in the home upon the demise of her father. The father’s will does not state this. Rather, his will indicates that the residue of his estate would be shared between the wife and her only other sibling, her sister. There is no evidence, documentary or otherwise, that Mr. Want intended that the wife would receive the home. There is also no evidence of an inter vivos gift.

[57] The wife did receive the full sale proceeds, as she has arranged with her sister who was entitled to an equal share of their father’s estate that the wife would receive the full sale proceeds in exchange for something else.

[58] The title holder to the home, Mr. Want, provided the complete down payment. Unlike the cases where a resulting trust has been found, he did indeed provide consideration.

[59] The wife was not the beneficial owner.

[60] The parties’ payment of the mortgage and tax payments was in the form of rent. As stated in Whiteside v. Govindasamy 2021 ONSC 789, “absent a financial contribution to the initial purchase of the property and a gratuitous transfer, a resulting trust cannot exist”.

Conclusion

[61] The evidence falls short of a finding of a resulting trust as described in Pecore v. Pecore, 2007 SCC 17, [2007] 1 S.C.R. 795, at para. 20: “[a] resulting trust arises when title to property is in one party’s name, but that party, because he or she is a fiduciary or gave no value to that property, is under an obligation to return it to the original titled owner”.

[62] The husband has failed to satisfy his onus on the balance of probabilities that the wife had a resulting trust. There is no clear convincing and cogent evidence that establishes this.

[63] Therefore, the sale proceeds from the home will not be included in the wife’s net family property.

[64] Accordingly, the husband owes an equalization payment to the wife in the amount of $189,470.96, which will be satisfied by a pension rollover from the husband’s government of Canada pension for that amount grossed up by 1.14 to account for tax payable by the wife when she begins receiving pension amounts.

Issue #2: Is the wife entitled to spousal support based on a compensatory basis?

Introduction

[65] The parties agree that the wife’s entitlement is based on need due to the length of the marriage and the disparity of the incomes of the parties.

[66] However, the wife submits that her entitlement is also based on compensatory grounds.

[67] The husband submits that there were no economic disadvantages to the wife, she did not make any sacrifices to her career and the support is needs based only.

[68] In accordance with the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.)and the Spousal Support Advisory Guidelines (“SSAG”), the basis for entitlement to spousal support is important to the determination of the quantum and duration of spousal support and to what extent the wife can benefit from any post-separation increases in the husband’s income.

[69] For the reasons set out below, I find that the wife’s entitlement to spousal support is largely based on need with a small compensatory element.

Legal Framework

[70] The starting point is s.15.2(1) of the Divorce Act which sets out the court’s jurisdiction to make a final spousal support order:

15.2 (1) A court of competent jurisdiction may, on application by either or both spouses, make an order requiring a spouse to secure or pay, or to secure and pay, such lump sum or periodic sums, or such lump sum and periodic sums, as the court thinks reasonable for the support of the other spouse.

[71] Subsection 15.2(4) directs the court to take into consideration the “condition, means, needs and other circumstances of each spouse”. It reads as follows:

(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 cohabited;

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

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

(5) In making an order under subsection (1) or an interim order under subsection (2), the court shall not take into consideration any misconduct of a spouse in relation to the marriage.

(6) An order made under subsection (1) or an interim order under subsection (2) that provides for the support of a spouse should

(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;

(b) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;

(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and

(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.

[72] These statutory objectives must be considered when the court considers entitlement, quantum and duration of spousal support.

[73] In the leading Supreme Court of Canada decisions of Moge v. Moge, 1992 25 (SCC), [1992] 3 S.C.R. 813, and Bracklow v. Bracklow, 1999 715 (SCC), [1999] 1 S.C.R. 420, the court held that spousal support entitlement must be determined in accordance with the Divorce Act with consideration to the following models: (1) compensatory support, which primarily relates to the first two objectives of the Divorce Act; (2) non-compensatory support, which primarily relates to the third and fourth objectives; and (3) contractual support. Entitlement may be established on more than one ground.

[74] In Bracklow, at para. 23, the court emphasized the needs based model of support, where the primary burden of meeting the needs of the spouse falls on the former spouse rather than the state. Support is aimed at narrowing the gap between the parties’ needs and means upon a breakdown of the marriage.

[75] On the other hand, the compensatory basis for spousal support entitlement recognizes that upon marriage breakdown, there should be an equitable distribution between the parties of the economic consequences of the marriage. Compensatory support recognizes sacrifices, contributions and benefits of the parties during their interconnected economic lives.

[76] Moge and Bracklow set out the following examples of compensatory support:

a) A spouse's education, career development or earning potential have been impeded as a result of the marriage because, for example:

a. A spouse has withdrawn from the workforce, delays entry into the workforce, or otherwise defers pursuing a career or economic independence to provide care for children and/or spouse;

b. A spouse's education or career development has been negatively affected by frequent moves to permit the other spouse to pursue these opportunities;

c. A spouse has an actual loss of seniority, promotion, training or pension benefits resulting from absence from the workforce for family reasons;

b) A spouse has contributed financially either directly or indirectly to assist the other spouse in his or her education or career development.

The SSAG set out following examples of economic disadvantage:

1. Home with children full-time or part-time

2. Secondary earner

3. Primary caregiver of the children after separation

4. Moving for payor’s career

5. Support for payor’s education or training

6. Working in family business

One needs to ask where the recipient would be if he or she continued in the labour market, not where he or she was years ago.

[77] At para. 32 of Bracklow, the Supreme Court stated, that while it is important to acknowledge and encourage self-sufficiency, it is also critical to recognize that “the goals of actual independence are impeded by patterns of marital dependence”. The Court stated that marriage is an “economic partnership” based on mutual support. The legislation requires courts to consider compensatory factors and the “needs” and “means” of the parties. “It is rather a matter of applying the relevant factors and striking the balance that best achieves justice in the particular case before the court”.

[78] At para. 40 of Bracklow, the Supreme Court stated that “Even if a spouse has foregone no career opportunities or has not otherwise been handicapped by the marriage, the court is required to consider that spouse’s actual ability to fend for himself or herself and the effort that has been made to do so, including efforts after the marriage breakdown”. The Court states that the legislation requires a consideration of the parties’ financial positions “not just those related to compensation”. The provisions of the Divorce Act require the court to consider the “condition, means, needs and other circumstances of each spouse”. “…they invite an inquiry that goes beyond compensation to the actual situation of the parties at the time of the application”.

[79] Therefore, all of the statutory objectives set out in (6) must be considered as no one objective is paramount, but the court has discretion to determine the weight that should be placed on each objective based on the parties’ circumstances: see Bracklow and Moge.

[80] In Moge, at p. 870, the court stated that “the longer the relationship endures, the closer the economic union, the greater will be the presumptive claim to equal standards of living upon its dissolution”.

Analysis

[81] This court finds that the wife’s entitlement is based on need, as the support obligation arises from the marriage relationship itself as the wife is unable to become self-sufficient. Under this model, spousal support is based on economic hardship resulting from the breakdown of the marriage.

[82] In contrast, compensatory support is premised on a marriage being a joint endeavor and seeks to alleviate economic disadvantage by taking into account all the circumstances of the parties, including the advantages conferred on either spouse during the marriage. It is concerned with an equitable sharing of the benefits of the marriage.

[83] The court will examine the advantages and disadvantages the parties experienced and the roles assumed during the marriage.

[84] For the reasons that follow, the court finds that there was an advantage conferred on the husband as articulated in Moge.

[85] I find that the wife’s claim for spousal support has a small compensatory element based on the following findings:

1. The husband’s career coaching and trajectory as a coach commenced during the marriage and cohabitation in 2008.

2. In 2009, the husband became a certified Integral Master Coach, and in 2010, began facilitating a management development program for public servants for a company called The Leadership Group.

3. He started coaching at Shopify in 2013 and on March 1, 2014, he started a contract through his corporation 8759740 Canada Inc. with Shopify whereby he would coach individual and teams within Shopify, and work with the Talent Acceleration program development and maintenance, which included training and coaching methods. He would also facilitate and engage in other duties. On January 1, 2017, he became a full-time employee of Shopify.

4. Therefore, his career and coaching had its roots in the marriage, where he commenced taking courses and building connections with people.

5. The wife’s contributions to this career path are rooted in being at home when he was away, supporting his decision to train in this new career so that the couple would have other income when he retired; and direct contribution in driving him on occasions. For example:

i. His visits with the Stevensons in Chelsea and work on their management project were done in the evenings while the wife remained at home caring for Eric which is an indirect contribution to his career;

ii. The evidence of the wife’s close friend, Ms. Dawn Beech, corroborates the wife’s role of being at home when the husband was out for training or networking. Ms. Beech talked to the wife every day and was familiar with the details of her life. Even though she moved away from the wife’s neighbourhood in 2008 and would not have been next-door to the wife and husband during this period of time, I find her evidence credible and reliable. She did not exaggerate her evidence, was a matter of fact and her answers did not attempt to embellish her observations;

iii. The wife’s contribution, although not significant, is manifested in her being home when he was on courses, some of which took place outside of work hours; for example at the hotel on Elgin Street with some occurring on Saturdays; she also drove him at times;

iv. The wife was taking care of the household when he went to Chelsea. The husband admitted to spending one overnight there when they were working on a project with a deadline; and

v. What is most significant with the husband’s decision to proceed with this career path was the discussion between the parties that this was going to be a new source of income when he retired at age 55, which would occur in 2014; The couple had discussed and agreed that his decision to proceed in this fashion would benefit the family; In that way, the wife was supportive of his decision to spend time away from the family in order to embark on this new career.

[86] However, the wife did not sacrifice her career or move to allow the husband to gain education in coaching for which he now receives substantial remuneration.

[87] I find the wife’s compensatory entitlement is on the low end of the spectrum because:

1. The wife was an administrative assistant at Carleton University at the time of the commencement of the relationship in 1992. She was an administrative assistant during the marriage until she began receiving long-term disability payments in 2008;

2. The wife did not make any sacrifices in her career as a result of the husband embarking on his coaching in 2008, as at that time she no longer had a career;

3. She did not move to benefit the husband’s career;

4. There were no economic disadvantages to her career or her future prospects in employment as a result of the husband taking on his new career;

5. Although the individual coaching was commenced during the marriage there were significant changes to his level of coaching after he worked with Shopify. His employer required him to revamp his style of coaching. He took courses and read books and learned to take into account the business objectives of private industry and the needs of the high-tech industry rather than using his approach of focussing on the individual objectives or personal goals;

6. The parties equally shared in the household responsibilities and the caring of Eric until 2008, when the wife went on long-term disability. The husband took on more responsibility during some points of her illness. Even though as I find above, she took on some responsibilities when he was away, I accept she was not in a position to take on a majority of the household responsibilities and take care of Eric when she was ill;

7. Dr. Biggar’s medical letters dated February 21, 2018 and April 17, 2020 were filed to provide details of the wife’s illness. In the letter dated February 21, 2018, the wife tells the doctor that during the marriage, the husband took over the cooking, cleaning, shopping and household responsibilities. The court notes that these statements were recorded by the doctor and that she did not testify at trial. The court places little weight on this statement:

− The statement is hearsay, and the doctor was not cross-examined;

− The doctor was not specific with respect to the date;

− There was evidence from both parties that when the wife was working full time, the household and child care duties were equally distributed; and

− This should be contrasted with the evidence supplied by Ms. Beech that the wife did not completely abdicate her household responsibilities after 2008 when she became disabled and in fact, the wife was tasked with more of the household duties when the husband was embarking on his new coaching training and career.

8. When the husband embarked on his new career path, I accept that he continued to assist in the household duties and with their son. He did not abdicate his responsibilities.

[88] For these reasons I find that the wife’s entitlement to spousal support is largely based on need with a small component of compensatory support.

Issue #3: What is the husband’s income for the purposes of determining spousal support?

Legal principles

[89] I have decided that the wife does have some compensatory element of entitlement which would entitle her to some of the husband’s increased post-separation income.

[90] But, I also find that her right to share in this post-separation income is rooted in her needs, the lengthy relationship and the husband’s ability to pay.

[91] Some previous cases stipulate that a spouse’s entitlement to spousal support on the other spouse’s increased income is only permitted if entitlement is based on compensatory grounds.

[92] However, as will be discussed below, the determination of spousal support is an exercise of discretion and requires a balancing and careful consideration of the factors and objectives set out in the Divorce Act.

[93] Each case turns on its own facts.

[94] A careful review of the recent trends in the case law shows a more flexible approach to the sharing of increased post-separation income. That is, a sharing can occur even in cases of non-compensatory support.

[95] I will review some of the cases that have discussed the sharing of increased post-separation income, then discuss Professor Thompson’s recent critique and finally review some of the recent case law.

Earlier cases

[96] Firstly, the principle set out in Patton-Casse v. Casse. 2012 ONCA 709, 298 O.A.C. 111, the Ontario Court of Appeal continues to apply. The Ontario Court of Appeal mandates a court to determine if there a connection between the post-separation income and the efforts of the payee spouse during the marriage. It said:

[26] In our view, it was open to the appeal judge to intervene. As he pointed out, in spite of evidence before him that Casse’s post-separation income was attributable to effectively new employment, the arbitrator failed to consider, as he should have, the question of what part of Casse’s post-2005 period was disconnected from Patton’s efforts during the marriage. The appeal judge put it this way: “His failure to do so is a reviewable error, as post-separation increases in income have to at least be analyzed in order to determine whether they are related to the marriage: see the annotation by James G. MacLeod to Rozen v. Rozen, 2003 Carswell B.C. 1564 (C.A.) where the author states:

Automatically sharing post-separation increases in income as akin to treating a job as if it were a family asset, shareable in specie. Rather than doing so as a matter of course, courts should investigate whether there is sufficient relationship between the increased income and the payee’s efforts during marriage to justify allowing him or her to share in the increase.

[97] Many cases have stated that a spouse should share in the increased income of the other spouse, if the support is compensatory. Support will almost always be calculated based on what the payor is then earning unless the payor has embarked on an entirely different career unrelated to the career pursued during the course of the marriage: see Epstein’s This Week in Family Law, Family Law Newsletter, January 28 2014, where Aaron Franks and Michael Zalev discuss the case of R.L. v. L.A.B., 2013 PESC 24, 342 Ndld. & P.E.I.R. 220.

[98] To share in post-separation increases in income, the wife must show that she had contributed to the acquisition of the other spouse's skills or credentials, thus contributing to his ability to earn the increased income. The court noted that such contribution need not be "tangible and explicit": Sawchuk v. Sawchuk, 2010 ABQB 5, 79 R.F.L. (6th) 135, at para. 30..

[99] If the increase in salary is founded in expertise and seniority established during the marriage and no intervening event or events are the cause of the increase, then the increase is to be included unless the recipient's role during marriage necessitates a different determination. If an event after separation is the reason for the increase, in whole or in part, then the increase may be excluded from consideration, also in whole or in part: Judd v. Judd, 2010 BCSC 153, 83 R.F.L. (6th) 314.

[100] The court commented on a spouse’s entitlement to share in post-separation increases in income when the parties’ career arcs were established prior to marriage and were not affected by compensatory factors (e.g. father was lawyer, mother was teacher). As such, retroactive claim for increased spousal support were denied in Hersey v. Hersey, 2016 ONCA 494, 87 R.F.L. (7th) 272. In that case, the Ontario Court of Appeal dismissed an appeal from a decision which relied on Thompson v. Thompson 2013 ONSC 550 (which will be discussed in further detail below). However, that case is distinguished from this case as the lower court found that the careers of the parties were established prior to the marriage, there had been no significant changes in the careers of either, there were no finding regarding child care responsibilities. In addition, the lower court did not accept that the recipient spouse’s medical condition was such that it prevented her from working full-time. In addition, her financial statement did not include the current value of the house she had acquired soon after the separation or her pension which were both significant assets.

[101] The Revised Spousal Support Guidelines section on “Post-separation income of payor increased” discuss that if there are regular small increases of income after separation, support can be increased with cost of living indexes: Carol Rogerson & Rollie Thompson, Spousal Support Advisory Guidelines: The Revised User’s Guide (Ottawa: Department of Justice Canada, 2016), at pp. 82-86.

[102] Where the payor's income increases significantly, the authors summarized the law at p. 83:

In the SSAG (at 14.3), we stated in summary form, in a short section on the topic:

Some rough notion of causation is applied to post-separation income increases for the payor, in determining whether the income increase should be reflected in increased spousal support and, if it should, by how much. It all depends on the length of the marriage, the roles adopted during the marriage, the time elapsed between the date of separation and the subsequent income increase, and the reason for the income increase (new job vs. promotion with same employer, or career continuation vs. new venture).

That word "causation" has often been read without the preceding words "some rough notion of causation". It would be better to describe it as a "link" or "connection", between the marriage and the increase after separation.

[103] The parties here referred extensively to Justice Chappel’s observations in Thompson v. Thompson, where she stated that a spouse can only share in a spouse’s increased post-separation income if the entitlement of support is rooted in compensatory grounds.

[104] This case has been referred to and followed by many cases across country.

[105] I take a different approach.

[106] As will be discussed below, Thompson has been critiqued by Professor Rollie Thompson, and Justice Chappel has now tweaked these principles in Kinsella v. Mills. 2020 ONSC 4785, 44 R.F.L. (8th) 1, so that there is no hard and fast rule that a spouse can only share in increased post-separation income if their entitlement is rooted in compensatory elements. Rather, the Court must return to the principles set out in the Divorce Act.

Thompson case

[107] To demonstrate the evolution of this principle, it is worthwhile to repeat the often-cited principles set out in Thompson:

[100] The Respondent’s position respecting spousal support is premised on the assumption that he should be permitted to benefit from alleged increases in the Applicant’s income since the parties’ separation in June 2009. This position raises difficult questions regarding the relevant timing for income determination in spousal support cases, and the circumstances in which a recipient spouse should be permitted to reap the benefits of the payor’s post- separation income increases.

[101] In addressing this issue, it is helpful to compare the approaches which the Ontario Court of Appeal adopted in two cases. In the 2003 decision of Marinangeli v. Marinangeli, where the facts indicate that the Respondent wife had a compensatory spousal support claim, the court made the following comments respecting need and ability to pay:

“In determining need, the court is to be guided by the principle that the spouse receiving support is entitled to receive the support that would allow her to maintain the standard of living to which she was accustomed at the time cohabitation ceased. In addition, there is jurisprudence to the effect that a spouse is entitled to an increase in the standard of living such as would have occurred in normal course of cohabitation. See MacDougall v. MacDougall (1973), 1973 1940 (ON SC), 11 R.F.L. 266, 1973 CarswellOnt 130 (Ont. S.C.) per Henry, J. See also Linton v. Linton (1990), 1990 2597 (ON CA), 1 O.R. 3d 1 (Ont. C.A.). At the same time the court must guard against redistributing the payor’s capital in the guise of support.”

[102] By contrast, in Fisher v. Fisher, where the Court of Appeal was dealing with a non-compensatory support claim, Lang, J.A. did not consider the payor spouse’s post-separation income in determining the spousal support claim. Rather, she averaged out the spouses’ respective incomes during the three years prior to separation and in the year of separation. These two cases provide a backdrop against which to analyse the issue of post-separation increases in a payor’s income, and they suggest that a fundamental consideration in determining how to treat such increases is whether the spousal support claim is based on compensatory or non-compensatory grounds.

[103] The authors of the SSAG and the cases decided since the guidelines were introduced have established that the treatment of post-separation increases in a payor’s earnings in spousal support cases is ultimately a matter of discretion for the court, to be undertaken having regard for the unique circumstances of each case and the general factors and objectives underlying spousal support. Upon considering these factors and objectives and the relevant case-law, I conclude that the following general principles should guide and inform the court’s exercise of discretion on this issue:

a) A spouse is not automatically entitled to increased spousal support when a spouse’s post–separation income increases.

b) The right to share in post-separation income increases does not typically arise in cases involving non-compensatory claims, since the primary focus of such claims is the standard of living enjoyed during the relationship.

c) Compensatory support claims may provide a foundation for entitlement to share in post-separation income increases in certain circumstances. The strength of the compensatory claim and the nature of the recipient’s contributions appear to be the major factors which may tip the balance either for or against an entitlement to share in the increased income.

d) The recipient spouse may be permitted to share in post-separation increases in earnings if they can demonstrate that they made contributions that can be directly linked to the payor’s post-separation success. The nature of the contributions does not have to be explicit, such as contribution to the payor’s education or training. The question of whether the contributions made by the recipient specifically influenced the payor’s post-separation success will depend on the unique facts of every case.

e) A spousal support award is more likely to take into account post-separation income increases where the relationship was long-term, the parties’ personal and financial affairs became completely integrated during the course of the marriage and the recipient’s sacrifices and contributions for the sake of the family and resulting benefits to the payor have been longstanding and significant. When this type of long history of contribution and sacrifice by a recipient spouse exists, the court will be more likely to find a connection between the recipient spouse’s role in the relationship and the payor’s ability to achieve higher earnings following the separation.

f) In determining whether the contributions of the recipient were sufficient, the court should consider such factors as whether the parties divided their family responsibilities in a manner that indicated they were making a joint investment in one career, and whether there was a temporal link between the marriage and the income increase with no intervening change in the payor’s career.

g) If the skills and credentials that led to the post-separation income increase were obtained and developed during the relationship while the recipient spouse was subordinating their career for the sake of the family, there is a greater likelihood of the recipient deriving the benefit of post-separation income increases.

h) By contrast, the likelihood of sharing in such increases lessens if the evidence indicates that the payor spouse acquired and developed the skills and credentials that led to the increase in income during the post-separation period, or if the income increase is related to an event that occurred during the post separation period.

i) Assuming primary responsibility for child care and household duties, without any evidence of having sacrificed personal educational or career plans, will likely not be sufficient to ground an entitlement to benefit from post-separation income increases.

j) Evidence that the post-separation income increase has evolved as a result of a different type of job acquired post-separation, a reorganization of the payor’s employment arrangement with new responsibilities, or that the increase is a result of significant lifestyle changes which the payor has made since the separation may militate against a finding that the recipient should share in the increase.

k) Where the payor’s post-separation advancement is related primarily to luck or connections which they made on his own, rather than on contributions from the recipient, the claim for a share in post-separation income increases will be more difficult.

l) The court may also consider the amount of time that has elapsed since separation as an indicator of whether the recipient’s contributions during the marriage are causally related to the post–separation income increases.

m) Evidence that the payor also made contributions to the recipient’s career advancement, or that the recipient has not made reasonable steps towards achieving self-sufficiency are also factors that may preclude an award that takes into account post separation income increases.[Citations omitted.]

Professor Rollie Thompson’s critique

[108] Professor Rollie Thompson provided a critique in “Post-Separation Increases in Payor Income and Spousal Support” (2020) 39 CFLQ 185, at p.15:

The Thompson principles are a good start, but some need to be worded more carefully (principles (b), (d)) and others should just be deleted (principles (i) and (m)). The frequent use of Thompson, not just in Ontario, but across the country, makes these tweaks important.

Principle (b) should add the following sentence at the end, to give it better balance: "Strong non-compensatory claims can lead to sharing, for example in some long-term relationships and in some cases of disability or illness." Principle (d) should start off more emphatically, i.e. "The recipient spouse will usually be permitted to share . . . if they can demonstrate that they made contributions that can be directly linked . . . ."

Respecting principle (i), not only should it be deleted, but there needs to be an emphatic statement, as is found in most of the case law across the country, that both "direct" and "indirect" contributions (like child care) can give rise to sharing the payor's post-separation increase. Sawchuk is no longer good law, if it ever was.

Okay, enough of the principles, what about the results, the trends, since 2016? In general, the analysis and factors suggested in the Revised User's Guide (see Appendix A) continue to animate the recent cases, consistent with the case law identified in the RUG. The "no sharing" bullets should probably give more emphasis to lapse of time (last on the list, but it should move up) and should add as a situation, "delayed retroactive claims". The recent "full or substantial sharing" cases are entirely consistent with the factors listed in the RUG. One small point: one factor noted there is "strong compensatory claims based on the assumption of primary responsibility for child-rearing", to which should be added, "whether before or after separation". We sometimes forget the compensatory claim arising from disproportionate post-separation child care, a point well-made in the recent cases of Cameron and Nieuwenhuysen.

The recent Ontario cases sort into the two ends of the post-separation spectrum, either "full or substantial sharing" or "no sharing". Lost in this dichotomy is that many cases can or should involve some degree of partial sharing, to recognize a mix of post-separation factors. Partial sharing is explicitly recognized more often in the cases outside of Ontario, and Ontario would do well to keep such intermediate resolutions in mind. To end on a practical note, sometimes that partial sharing is accomplished by the use of location in the range. The lower end of the higher post-separation SSAG range can be used to dial back the degree of sharing. You can get more flexibility by using the higher post-separation range than the alternative — using the separation date incomes and then the higher end of that range. Much depends upon how big is the post-separation increase in income. Where the increase is not large, you may even find some overlap between the two ranges.

What the last five years of cases don't tell us is almost as important. We don't see some of the more compelling non-compensatory claims for sharing, like long interdependent relationships without children or the illness and disability cases. Or longer relationships with children where both parents work full-time and parent equally. What if the income increases in these cases take place closer to separation and reflect a continuation of previous employment, training and experience during the relationship? These are the "hard" cases on the post-separation issue, the non-compensatory cases which will require a more careful inquiry into the facts and likely will expose differences of opinion and policy. [Citations omitted.]

Post-Thompson

[109] At para. 431, Chappel J. in Kinsella refined the principles in Thompson, thereby acknowledging that a right to post-separation income is not restricted to compensatory spousal support cases. She states one factor to consider:

The basis of a spouse's entitlement to spousal support is an important consideration. In both compensatory and non-compensatory cases, the court's assessment of the needs of the recipient and ability of the payor spouse to pay are significant factors that should inform the court's analysis regarding sharing of post-separation income increases (Hartshorne v. Hartshorne, 2010 BCCA 327 (C.A.), at para. 56 ("Hartshorne 2010"). However, in cases involving non-compensatory claims, the focus tends to be on maintaining a reasonable standard of living as measured by the standard enjoyed during the relationship, and this is a factor which may impact the decision as to whether a recipient should benefit from the payor's post-separation income increases (A.A.M. v. R.P.K., 2010 ONSC 930 (S.C.J.); Kohan v. Kohan, 2016 ABCA 125 (C.A.); T.N.F. v. M.V.J.A., 2018 ONSC 3310 (S.C.J.)). Nonetheless, the circumstances of each case must be carefully considered to ensure a just outcome, having regard for all of the objectives and factors outlined in the relevant legislation. The needs of the recipient spouse are always a very important part of the spousal support analysis and may support a sharing of post-separate income increases in purely needs-based claims in appropriate circumstances. For instance, a long-term relationship involving financial dependence by the recipient spouse coupled with evidence of significant ongoing need may support sharing of post-separation income increases. Even in shorter or mid-length relationships, a strong non-compensatory claim based on factors such as illness, disability or other considerations may support some sharing of income increases to ease the transition to a new post-separation reality.

[110] In Nieuwenhuysen v. Nieuwenhuysen, 2019 ONSC 4775, at para. 47, the court found thatthe wife was entitled to share in the husband’s post-separation increases in income because her entitlement was based on compensatory grounds, it was a long-term relationship where the parties’ personal and financial affairs were completely integrated and the continual increases in the Husband’s income were attributable to a job that was obtained when the family still lived together in the matrimonial home (even though they were living separate and apart).

Decision

[111] The above development of the law in spousal support confirms that for a spouse to share in the other spouse’s post-separation increases in income, the court should embark on the following steps:

i. Review whether there is some link between the recipient spouse’s efforts and the post-separation increases in income;

o The recipient spouse will usually be permitted to share if they can demonstrate that they made contributions that can be directly linked to the increased income;

o If there is a link which includes the recipient spouse’s direct and indirect contributions, then the recipient spouse’s spousal support is based on a compensatory elements and he/she will be entitled to share in some or all of the post-separation income;

o Both direct and indirect contributions (like child care) can give rise to sharing the payor's post-separation increase, whether before or after separation.

ii. Consider the time elapsed since the date of separation;

iii. Consider the reason for the subsequent income increase (new job vs. promotion with same employer, or career continuation vs. new venture);

iv. Consider whether there are other compensatory elements. While there may be a weak link between the recipient wife’s efforts, e.g. he/she made no sacrifices, did not lose career opportunities, did not move for the spouse’s career, there may still be elements of a compensatory nature, such as the career trajectory started as here during the marriage. In these cases, the recipient spouse may be entitled to share in some of the post-separation income increases;

v. Consider whether there is a strong non-compensatory claim, seen for example in some cases of long-term relationships and disability or illness. These cases open the possibility for the sharing of the post-separation income.

vi. Consider sharing post-separation increases of income’s objective of maintaining a reasonable standard of living, as measured by the standard enjoyed during the relationship;

vii. Consider if the income increases take place closer to separation and reflect a continuation of previous employment, training and experience during the relationship; and

viii. Carefully inquire into the facts for some non-compensatory cases.

[112] Here, the wife will be entitled to share in the husband’s post-separation increased income because:

i. She has a small component of compensatory support entitlement;

ii. She had both "direct" and "indirect" contributions (like child care) that can give rise to sharing the payor's post-separation increases;

iii. There were indirect contributions, such as being home with the child when the husband was out working with Leadership group or courses, and being supportive for his new career; there was ample evidence from the wife that was corroborated by Dawn Marie Beech, her past neighbour and current friend, that she was home taking care of the house and child when he was out developing his new career path; and

iv. She had a strong non-compensatory claim, i.e. the wife’s need is great.

[113] How does this translate into determining the quantum of spousal support?

[114] This is not an “all or nothing” scenario.

[115] In determining the range, the court could consider the following:

i. The parties’ financial statements, including the parties’ disposable income, assets, debts, etc.

ii. The parties’ current conditions, means and circumstances;

iii. Whether there are fluctuations in income and whether averaging is appropriate;

iv. Whether the spouse has a dire need for support. This may move the needle to the higher end;

v. Whether there is a low compensatory element. This may move the needle to the lower end;

vi. The length of the relationship;

vii. Whether this is an initial application or a variation and how much time has passed since the date of separation;

viii. How long the payor spouse has been paying spousal support;

ix. The financial impact of the division of property on the parties’ respective financial situations;

x. The objectives and factors set out in the Divorce Act; and

xi. The SSAG’s.

[116] The wife’s financial statement shows the following:

i. An income of approximately $30,684;

ii. Her monthly expenses are:

− $2,040 in rent;

− $300 in home insurance;

− $780 for debts;

− $380 for her car loan;

− $400 for drugs, which includes Eric’s ADHD medication;

− $84 for psychotherapy; and

− $310 for car insurance (which includes Eric);

iii. Her expenses surpass her income:

− She lives with her 27 year old son;

− Eric is not working nor contributing financially to the home;

− She is the sole supporter in the household;

− Her bank accounts have a balance of $2,366;

− Her outstanding debts are $124,000:

• Personal loans of over $18,000;

• Debt to Canada Revenue Agency for $24,000;

• Legal fees of $17,000;

• Dentist fees of $1,885; and

• Credit card debts;

− She services the debts at $780 per month; and

− She has little discretionary spending for entertainment, vacation, alcohol/tobacco/gifts.

[117] The wife was in a long-term relationship of 22 years;

i. She has a disability and has a very low income; and

ii. She will be receiving an equalization payment by way of rollover which will not have any immediate financial impact on her until she converts the retirement funds into an income producing vehicle.

[118] The court notes that the wife did liquidate assets in order to reduce her debt load yet, the husband was critical that she could have done more in managing her finances. I find that based on her level of income received, that she did indeed attempt to manage to her ongoing expenses. Undoubtedly, her living expenses and debts which were not met by the income she received created a financial burden to her that caused her stress.

[119] On the other hand, the husband’s financial statement shows:

i. The husband has a substantial income;

ii. He does not own the home he lives in and has no mortgage payments;

iii. He contributes $2,000 per month towards the household expenses;

iv. He lives with his partner who earns $3,700 per month and contributes $2,500 per month towards the household;

v. His expenses include $1,500 per month for alcohol/tobacco/entertainment and gifts;

vi. He spends $1,000 per month for vacation;

vii. He states he pays $4,000 per month for debts. However, compared to the wife, he has few debts:

o RBC of $20,000;

o Visa of $5,000; and

o RBC of $12,000;

viii. He has his pension valued at twice the maximum transferrable amount of $767,251; and

ix. It is odd that in his financial statement, he declares no other assets other than some investments. I find it incredulous that the husband does not declare any assets at all: such as a bank account, a piece of jewellery, furniture, electronic equipment, artwork, etc.

[120] All of his income cannot be used in determining the wife’s spousal support. I have found that some of the trajectory of his career did change after the separation. He became a full-time employee and learned new skills in his coaching practice. He took courses, learned different methodologies and changed his manner of working to comply with his employer’s expectations.

[121] In addition, he only became a full-time employee in 2017, which was four years after separation. His income did substantially increase at that time.

[122] Yet, the wife of a 22 year relationship should be entitled to share some of the fruits of his labor. Her financial statement shows dire need. Her evidence shows how challenging it is for her to make ends meet. She is required to attend pawn shops and sell her personal items.

[123] In contrast, the husband’s monthly budget shows many discretionary expenses. He admits to regularly buying a bottle or two of wine at a cost of $100 when frequenting restaurants.

[124] The husband is certainly entitled to spend money on entertainment. However, he continues to have spousal support obligations to his wife.

[125] When considering the factors and objectives of the Divorce Act and given the long-term relationship, there must be some consideration for the wife’s needs and his ability to pay.

[126] At this time, I find that an appropriate level of support is to use all his pension income plus 35% of the husband’s other income when determining spousal support. She would be entitled to the higher range of the SSAG given her high needs, his ability to pay and the long-term relationship.

[127] Based on the SSAG, this would amount to ongoing spousal support of $3800 per month commencing January 1, 2021 until the pension rollover occurs.

Issue #4: Is the wife entitled to an adjustment to the amount of spousal support paid by the husband from 2017 (when the application was commenced) to today?

Introduction

[128] For the reasons that follow, spousal support will be adjusted in accordance with the formula set out above.

[129] The wife submits that there should be an adjustment of spousal support retroactive to 2017, the date that her application was commenced.

[130] Her position is that she should share in all of the husband’s increased post-separation income. Taking into account that there will be no tax treatment of any spousal support payments, the wife submits that the husband owes the following:

• 2017: $5,380;

• 2018: $30,720;

• 2019: $37,716; and

• 2020: $45,562.

[131] The husband submits that he only owes the amount of $1,420 for 2017 as he has paid the appropriate level of support throughout.

Legal Principles

[132] Kerr sets out following principles for retroactive spousal support:

1. D.B.S. factors apply as modified for spousal support (circumstances of the spouse are relevant as opposed to circumstances of the child).

2. Presumptively, the date of the claim being issued is the start date for support, unless there is a reason to order otherwise.

3. The failure to bring a temporary motion should not be penalized, as we should be encouraging people to avoid the cost of bringing temporary motions. This is particularly the case where the claimant moves the matter quickly to trial after obtaining disclosure.

4. At para. 208 the court states: “Spousal support has a different legal foundation than child support. A parent-child relationship is a fiduciary relationship of presumed dependency and the obligation of both parents to support the child arises at birth. It that sense, the entitlement to child support is “automatic” and both parents must put their child’s interests ahead of their own in negotiating and litigating child support. Child support is the right of the child, not of the parent seeking support on the child’s behalf, and the basic amount of child support under the Divorce Act, R.S.C. 1985, c.3 (2nd Supp), (as well as many provincial child support statutes) now depends on the income of the payor and not on a highly discretionary balancing of means and needs. These aspects of child support reduce somewhat the strength of concerns about lack of notice and lack of diligence in seeking child support. With respect to notice, the payor parent is or should be aware of the obligation to provide support commensurate with his or her income. As for delay, the right to support is the child’s and therefore it is the child’s, not the other parent’s position that is prejudiced by lack of diligence on the part of the parent seeking child support: see D.B.S., at paras. 36-39, 47-48, 59, 80 and 100-104. In contrast, there is no presumptive entitlement to spousal support and, unlike child support, the spouse is in general not under any legal obligation to look out for the separated spouse’s legal interests. Thus, concerns about notice, delay and misconduct generally carry more weight in relation to claims for spousal support”.

5. At para. 212, the court states that “D.B.S. emphasized the need for flexibility and a holistic view of each matter on its own merits; the same flexibility is appropriate when dealing with “retroactive” spousal support.”

[133] Regarding tax issues, the court must discount the award based on the payor’s inability to deduct it.

[134] In Charron v. Carrière, 2016 ONSC 7523, 86 R.F.L. (7th) 108, the court netted down the retroactive support award by the mid-point of the parties’ respective tax rates.

[135] In accordance with the Court of Appeal’s observations in Fielding v. Fielding, 2015 ONCA 901, 129 O.R. (3d) 65,it is reasonable to apply a deduction to this amount to account for the tax consequences of the retroactive payment. In Fatahi-Ghandehari v. Wilson, 2021 ONSC 3547, the court applied a 20% rate where the payor reported low income and the recipient no income..

Decision

[136] It is appropriate that there be an adjustment of spousal support from 2017 for the following reasons:

i. The husband had formal notice of the spousal support claim since the commencement of the action in 2017;

ii. The quantum of spousal support was discussed throughout the litigation and the husband was aware that the wife was not content with the level of spousal support she was receiving of $2,300 per month;

iii. He was aware of his obligation;

iv. It would not be a hardship to him, as he has substantial income sources and has the ability to pay;

v. Her need is great; and

vi. She has incurred numerous debts in large part due to underpayment of spousal support.

[137] The formula for ongoing support is to use the husband’s total pension income plus 35% of his other income.

[138] The parties are to complete the calculations for 2017, 2018, 2019 and 2020 using the parties’ respective incomes as set out above, i.e. based on pension income plus 35% of his other income using the high end of SSAG to make the adjustments.

[139] The parties are to consider the tax implications to the payments owed for 2017 2018, 2019 and 2020 and make the necessary tax adjustments as set out in Charron using the mid-point of the parties’ tax rates unless the parties agree otherwise.

[140] Once the parties have calculated the amount owing, they are to discuss and attempt to resolve the timing of the payment.

[141] If the parties are unable to agree on these issues within 30 days from this decision, they can request an audience before me through the trial coordinator’s office. I will also determine the costs of any further steps with respect to these issues at the time of that hearing. Counsel are directed to bring a bill of costs with them at the hearing.

Issue #5: Is the wife entitled to double dip (i.e. receive support based on the husband’s pension income that has already been included in the division of net family properties)?

Introduction

[142] The wife submits that she is entitled to spousal support from the husband’s pension income as there are exceptions to double dipping as set out in Boston v. Boston, 2001 SCC 43, [2001] 2 SCR 413.

[143] The husband argues that his pension income that he will receive after the pension rollover represents his share of his pension and the wife has already received her portion of the pension accrued during the marriage.

[144] The court was not given the amount of pension income that he will be receiving once the rollover is made.

[145] After the pension rollover occurs and hence the level of the husband’s pension income has been reduced, that is the firstday of the month after the division, the spousal support will need to be adjusted.

[146] As will be discussed below, considering the circumstances of this case, notably the wife’s high need for support and the husband’s ability to pay, the court finds that there should be some double dipping.

Legal Framework

[147] In Boston, the Supreme Court stated:

54. When a pension is dealt with by the lump-sum method, the pension-holding spouse (here the husband) must transfer real assets to the payee spouse (here the wife) in order to equalize matrimonial property. The wife can use these real assets immediately. Under a compensatory spousal support order or agreement, the wife has an obligation to use these assets in an income-producing way. She need not dedicate the equalization assets to investment immediately on receiving them; however, she must use them to generate income when the pension-holding spouse retires. The ideal would be if the payee spouse generated sufficient income or savings from her capital assets to equal the payor spouse’s pension income. In any event, the payee spouse must use the assets received on equalization to create a “pension” to provide for her future support.

55. This requirement is based on the principle that, as far as it is reasonable, the payee spouse should attempt to generate economic self-sufficiency. Self-sufficiency is only one factor of many that is weighed. It is obvious that in most cases of long-term marriage, the goal of self-sufficiency is decidedly difficult to attain, particularly for spouses who remained at home during the marriage. Self-sufficiency will often not be practicable largely due to the residual effects of being outside the labour market for a protracted period of time. In addition, there are factors to consider such as age, education and parenting responsibilities. Consequently, it is often unreasonable to expect the payee spouse to earn an income from employment after separation or divorce.

56. However, where the payee spouse receives assets on equalization in exchange for a part of her former spouse’s pension entitlement, she must use those assets in a reasonable attempt to generate income at least by the time the pension starts to pay out. The reason for this requirement is clear. The payee spouse cannot save the assets that she receives upon equalization and choose instead to live on the liquidation of the payor spouse’s pension when he retires. If she were permitted to do so, the payee spouse would accumulate an estate while the payor spouse’s estate is liquidating.

[148] The payee spouse’s need and the payor spouse’s ability to pay are always factors which a court considers when determining spousal support: see s. 33(9) of the Family Law Act, R.S.O. 1990, c. F.3. Another issue is the extent, if any, of “double recovery”.

[149] However, the Supreme Court in Boston left it open that in some cases, double recovery could be permitted:

65. Despite these general rules, double recovery cannot always be avoided. In certain circumstances, a pension which has previously been equalized can also be viewed as a maintenance asset. Double recovery may be permitted where the payor spouse has the ability to pay, where the payee spouse has made a reasonable effort to use the equalized assets in an income-producing way and, despite this, an economic hardship from the marriage or its breakdown persists. Double recovery may also be permitted in spousal support orders/agreements based mainly on need as opposed to compensation, which is not the case in this appeal.

[150] In summary, the Supreme Court held at para. 63 that double dipping – allowing “the payee spouse to reap the benefit of the pension both as an asset and then again as a source of income” – is “generally unfair”, particularly where the payee spouse retains the asset and does not make a reasonable attempt to convert it into income. The decision notes that courts should therefore focus on the assets of the payor spouse that were not subject to division when assessing that spouse’s ability to pay support. The court went on to state, however, that double dipping cannot always be avoided, and may be reasonable in some circumstances: namely, “where the payor spouse has the ability to pay, where the payee spouse has made a reasonable effort to use the equalized assets in an income-producing way and, despite this, an economic hardship from the marriage or its breakdown persists”: at para. 65. Thus, double-dipping is to be avoided, but cannot be ruled out in all cases.

[151] In the recent case of Melis v. Zwanenburg, 2017 ONSC 613, 92 R.F.L. (7th) 159, the Ontario Superior Court of Justice again considered the issue of double-dipping. Justice Beaudoin found that the husband was entitled to continue to receive spousal support and double dip.. The parties were married for 18 years and the wife was ordered to pay the husband spousal support in the amount of $3,200 per month. The husband received an equalization payment, including a lump sum amount from the wife’s federal government pension of approximately $217,000. When the wife subsequently retired, she sought a variation in the spousal support amount, given the change in her income.

[152] The court held that the husband was entitled to continuing support, as he had “sacrificed his career to take care of the [sic] their child and allow [the wife] to further her own career”: at para. 25. The central issue in the case was whether, in determining the quantum of support, the court would take into account the portion of the pension retained by the wife following the division of the pension at the time of the parties’ marriage breakdown. Citing Boston v. Boston, the court held that it was required to focus on the portion of the wife’s assets that were not part of the equalization, in determining the amount of support payable. While the court found that the husband had in fact made a reasonable effort to produce an income from the assets he received for equalization, it nevertheless held that an appropriate support order could be made without taking into account the portion of the wife’s pension that she retained. Therefore, the court did not have to resort to “double-dipping” in order to make an appropriate support order. Boston v. Boston remains good law: double-dipping is generally to be avoided but may be permitted in certain circumstances.

[153] In Senek v. Senek, 2014 MBCA 67, 46 R.F.L. (7th) 1,the Manitoba Court of Appeal ruled that, despite a material change in circumstance where the husband had recently retired, the wife was entitled to “double-dip” and receive spousal support from her husband’s pension simply on the basis of necessity. Therefore, when a court is faced with the dilemma of awarding a double-recovery of spousal support, the court will render a decision based on principles such as fairness and necessity. The court refers to Major J. in Boston where he stated that double recovery can occur when spousal support is based on compensatory grounds. The court also referred to S.K.M. v. F.E.M., 2012 PECA 3, 319 Nfld. & P.E.I.R., at para. 91 : “simply put, the challenge is to avoid double recovery when it is fair to do so. This is not to say that in all cases double recovery will be eliminated because, in some cases double recovery may be the only fair way to continue support”: see also Cymbalisty v. Cymbalisty, 2003 MBCA 138, 180 Man. R. (2d) 112, at para. 37.

[154] In S.K.M., the wife had a need and relied heavily on spousal support.

Decision

[155] I borrow from the words of Major J. in para. 65 of Boston, the fact that “an economic hardship from the marriage or its breakdown persists” will entitle the wife to double dip even if a portion of it will have to come from the equalized part of the husband’s pension.

[156] Based on the evidence, this case fits into an exception to the general rule of avoiding double dipping because:

• The wife continues to be in dire need of spousal support;

• She has economic hardship;

• She is in poor health;

• She has limited income; and

• The husband has the ability to pay as he has other substantial income;

[157] The court was not provided with actuarial evidence regarding the pension values and the effect of the rollover on the amount of income that the husband will receive.

[158] The court has the following evidence:

• The rollover with the tax gross up will be approximately $215,996.89, but there may be interest accrued on that amount by the time that the rollover is made;

• The husband’s financial statement indicates that the value of his pension (which is not the family law pension value) is twice the maximum transferrable amount, which is the government’s figure and not a static figure - $767,251;

• This would leave approximately $550,000 in the husband’s pension plan;

• There is no evidence before me of what that this will mean for his pension income, but if one third of his pension is distributed, then one can assume his pension will be reduced by one third;

• His pension income will be approximately $50,000; and

• The court is not aware of what portion of that $50,000 has already been equalized.

[159] I also note that the wife has no other significant assets other than her RRSP.

[160] Therefore, based on the facts before me, the court finds that there should be some double recovery.

[161] However, as stated above, the court does not have a full record to determine how much double dipping should occur.

[162] The parties are encouraged to resolve this issue once the pension rollover occurs, taking into account my findings above.

[163] In the event that they cannot agree, then the parties may seek an audience before me to determine what portion of the husband’s pension will be available for spousal support. Costs outlines must be provided at the hearing.

When should spousal support end?

Introduction

[164] Retirement may be a ground of review in an order or agreement, especially where the retirement is likely to occur in the near future as a “genuine and material uncertainty”, to use the language of Leskun v. Leskun, 2006 SCC 25, [2006] 1. S.C.R. 920, at para. 37. In these cases, there is no need to prove a “material change”.

[165] The wife submits that the husband should continue to pay spousal support until he retires from his employment, provided that it is not before he turns 65 years of age, at which time, spousal support will be suspended pending a review of continued entitlement.

[166] The husband submits that support should be terminated once the equalization payment is paid through the rollover of his pension, as then the pension will have been equalized and any income from his pension will be from an equalized asset.

Decision

[167] Duration and quantum of support are separate and interrelated tools available to courts to best achieve the purposes of spousal support as set out in the Divorce Act.

[168] The SSAG’s use the length of the relationship to categorize cohabitation:

a. A short-term cohabitation is less than five years;

b. A medium-term cohabitation is from five to nineteen years; and

c. A long-term cohabitation is twenty years or longer.

[169] The court orders that spousal support will be suspended and reviewed when the husband retires, which will not occur sooner than his 65th birthday.

[170] There is a high need for support and the small compensatory element permits the wife to share in this post-separation income. The husband will continue to earn a substantial income from his Shopify employment and other benefits accrued from that employment. The post-separation income should also be shared given the length of the relationship, the roles played in the marriage, the wife’s inability to become self-sufficient due to her disability and her dire need and increasing debt load.

[171] Therefore, spousal support will continue until the husband retires, which will not be earlier than age 65.

[172] Regarding security for spousal support, so long as the husband must pay spousal support, he will designate the wife as irrevocable beneficiary of his life insurance policy with the government of Canada with a face value of $216,000. He will provide proof of this designation within 30 days from the date of this judgment.

[173] If the parties cannot agree on the issue of costs, then the wife may provide her two page costs submissions along with any offers to settle and bill of costs by December 20, 2021, and the husband may provide his two page costs submissions along with any offers to settle and bill of costs by January 10, 2022. The wife may file her one-page reply by January 20, 2022.

Justice A. Doyle

Released: November 29, 2021

COURT FILE NO.: FC-17-1336

DATE: 2021/11/29

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

CAROL JEAN WANT

Applicant

– and –

PIERRE ANTOINE GAUTHIER

Respondent

REASONS FOR JUDGMENT

Doyle J.

Released: November 29, 2021