COURT FILE NO.: FS-12-00375231-0003 DATE: 20230331
ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
Victoria Fielding Applicant – and – John Craig Fielding Respondent
Counsel: Gary Joseph and Elissa Gamus, for the Applicant Michael Zalev and Raquel Simpson, for the Respondent
HEARD: November 29, 2022
PINTO J.
Reasons for Decision (Motion to Change)
(The text of the original Reasons for Decision has been corrected as per my endorsement of February 9, 2024)
Overview
[1] Victoria and Craig Fielding were married in June 1993, separated in December 2010, and divorced in April 2014. They have three adult children: Katie, now 26, born in August 1996; and twins Sean and Natalie, now 24, born in August 1998.
[2] The parties were both practicing physicians when they married. Prior to his retirement in December 2021, Craig worked as a plastic surgeon at St. Joseph's Hospital in Toronto. He also had a private office on Bloor Street that closed when he retired. Victoria worked as a urologist until 2007 when she withdrew from practice due to vision problems caused by a degenerative eye condition. She received long term disability benefits until she turned 65 in February 2022. Since the parties' separation in 2010, they have been in family court proceedings almost continuously.
[3] The previous litigation has included:
(a) A 15-day trial in 2013 before Justice McKinnon over parenting issues: Fielding v. Fielding, 2013 ONSC 5102.
(b) A 10-day trial in 2014 before Justice Mesbur over financial issues: Fielding v. Fielding, 2014 ONSC 2272.
(c) Victoria's unsuccessful appeals of the two trial decisions to the Court of Appeal in 2015: Fielding v. Fielding, 2015 ONCA 901.
(d) An 11-day trial in respect of Craig's first Motion to Change before Justice Monahan in 2018: Fielding v. Fielding, 2018 ONSC 5659.
[4] This is my decision concerning the latest chapter in the parties' litigation. Craig brings a Motion to Change to terminate his child support and spousal support obligations now that he has retired. In response, Victoria seeks to double her spousal support payments now that her disability benefits have ended, and to continue to receive child support until Natalie completes her graduate degree in August 2023.
[5] For the reasons that follow, I find that:
a) Craig’s decision to retire effective December 31, 2021 was reasonable. b) Craig’s retirement and the corresponding reduction in his income was a material change in circumstances. c) The termination of Victoria’s long term disability coverage in or around February 2022 was a material change in circumstances. d) Craig is entitled to stop paying spousal support as of December 31, 2021 and should be credited with any overpayments in spousal support he has made to date. e) Victoria is entitled to receive child support in respect of Natalie until August 31, 2023 but not after that date. The child support payments, if any, shall continue to be governed by the Order of Justice Monahan. f) Craig is not required to pay Table child support for Natalie for the months of October 2020, November 2020 and February 2021. g) Craig is required to pay Table child support for Natalie for May to August 2021. h) Craig’s Guidelines income for 2021 is $655,988. i) Craig is required to pay Table child support for Natalie for August 2022 and August 2023. j) Craig’s Guidelines income for 2022 and 2023 shall be based on his income tax returns for the years in question. k) Craig is required to pay $85,565 in s. 7 expenses, and Victoria is required to pay $44,079 in s. 7 expenses for the period 2018 to 2022, inclusive. l) Craig and Victoria are required to pay for s. 7 expenses for Natalie up to August 31, 2023 based upon Craig paying 66% and Victoria paying 34% of the s. 7 expenses which, in turn, shall be no more than $30,000 per year. m) Craig is entitled to terminate his maintenance of Victoria as the beneficiary of extended medical, dental, and life insurance coverage effective April 1, 2023. n) To the extent that Victoria has not already terminated life insurance coverage for Sean and Katie, she is entitled to do so. o) Neither party owes the other any further financial or other disclosure. p) Victoria still owes Craig costs arising from the February 4, 2019 costs decision of Justice Monahan.
The Family Law Proceedings up to 2018
[6] In Justice Monahan's decision at paragraphs 7 to 32, he describes the family law proceedings up to 2018. Some of the key developments were that:
(a) Craig received sole custody of Katie and Sean, and Victoria received sole custody of Natalie. (b) Craig owed Victoria an equalization payment of $1,560,954.74. (c) Craig was ordered to pay spousal support of $10,000 a month for an indefinite period based on an annual income of $850,000, with Victoria's annual income assessed at $220,000. (d) Craig owed Victoria set-off Table child support of $3,633 a month, but this would increase to $4,662 a month when Katie started university away from home in September 2014, and would return to $3,633 a month from May to August if Katie returned home to live with Craig during the summer. (e) Craig would pay for 68% of the children's s. 7 expenses, and Victoria would pay for 32%. (f) Victoria's claims for prejudgment interest and indexed spousal support were dismissed. (g) In November 2016, Craig brought a Motion to Change to vary Justice Mesbur's Order to confirm that he was not required to pay Table child support for the months in which Sean and Natalie were away at university. (h) In response to Craig's Motion to Change, Victoria attempted to re-open almost every aspect of Justice Mesbur's April 2014 Order, including re-litigating the issue of Craig's income for support purposes. (i) Shortly before the trial of the Motion to Change before Justice Monahan, Victoria brought a disclosure motion to allow her expert to conduct a forensic audit of Craig's medical practice. Justice Backhouse dismissed Victoria's disclosure motion. On March 23, 2018, Justice Backhouse ordered Victoria to pay Craig $75,000 in costs for the disclosure motion. She also determined that Craig had behaved reasonably, and Victoria had acted in bad faith.
Justice Monahan's 2018 decision: Craig's First Motion to Change
[7] Following the trial of Craig's first Motion to Change, Justice Monahan found that Craig's disclosure had been sufficient and reasonable.
[8] Justice Monahan rejected Victoria's claim that there had been a material change in circumstances since the spousal support order of Justice Mesbur in 2014. Accordingly, he ordered that Craig continue to pay $10,000 a month in spousal support based on an annual income of $850,000.
[9] Justice Monahan granted Craig's request for an Order confirming that neither party would have to pay Table child support for Sean or Natalie during the school year. He also found that Craig's income for child support purposes was actually lower than the $850,000 a year Craig had agreed to prior to the 2014 trial before Justice Mesbur. He found Craig's Guidelines income for 2018 to be $760,589 based on an average of Craig's Guidelines income for 2015, 2016 and 2017; and Victoria's Guidelines income for 2018 to be $216,961. The income figures were to be utilized for the purposes of calculating Table child support commencing June 1, 2018.
[10] Justice Monahan dismissed Victoria's requests to: (a) significantly increase Craig's child and spousal support payments; (b) have Craig's spousal support payment indexed; and (c) terminate her child support obligations for Katie retroactive to April 2014.
[11] Justice Monahan ordered that, as of January 1, 2018, the s. 7 expenses for Sean and Natalie would be split 66% to be paid by Craig and 34% by Victoria and be limited to: (a) tuition and other mandatory academic fees; (b) academic supplies; (c) housing; (d) uninsured medical expenses; and (e) a lump sum payment of $600 per month during the academic year to cover general living expenses.
[12] On February 4, 2019, Justice Monahan ordered that that the amount of additional table child support and s. 7 expenses that Craig owed Victoria for 2014 to 2017 – $23,582 total for the 48 months in question – would be set off against the $500,000 in legal costs Victoria owed Craig, and ordered Victoria to pay the balance of $476,418 by May 3, 2019: Fielding v. Fielding, 2019 ONSC 833 at para. 4.
[13] Victoria withheld $44,980.28 from the $476,418 in costs that she had been ordered to pay Craig on the basis that he purportedly owed her roughly the same amount of funds in respect of his 66% contribution of $68,000 in new s. 7 expenses.
Developments after 2019
[14] In March 2020, due to the global pandemic, Craig's hospital, St. Joseph's, closed except for urgent cases and remained closed until September 2020. Craig claims that COVID-19 also significantly reduced demand for the types of minor procedures that he was able to do at his office.
[15] In May and July 2020, Craig advised Victoria that his income had declined due to the impact of COVID-19 on his medical practice.
[16] In September 2020, St. Joseph's Hospital started to try to reopen. Craig claims that his department was still not allowed to perform cosmetic procedures and the hospital was unable to resume regular operations due to pandemic related issues. In January 2021, St. Joseph's reduced its operating room capacity by 25% to prepare for a potential new wave of COVID-19 cases. Craig claims that this had a disproportionate effect on his department as many of the surgeries it performed were not considered urgent, and his department ultimately lost another 40% of its already limited operating room time.
[17] On January 20, 2021, Craig provided Victoria with a letter from his financial expert, Steve Ranot, explaining that although Craig's corporate financial statement for the year ending March 31, 2021 was not yet complete, based on the available information, it appeared that Craig's professional income had decreased significantly as a result of COVID-19. Craig also provided Mr. Ranot's updated income report for 2018 to 2019.
[18] On February 5, 2021, Victoria sent Craig another request for disclosure advising that further disclosure requests would follow. She also sent Craig additional receipts for s. 7 expenses, but did not disclose any information about the children's RESPs. Craig responded by reiterating his request for information about the RESPs, and asked Victoria to send him a single request of all the disclosure that she was seeking, so that he could deal with her requests in a comprehensive manner.
[19] In April 2021, Craig advised Victoria that he would be making arrangements to close his office and retire by the time he turned 64 in January 2022, or earlier. He advised that he would be starting a Motion to Change to deal with his decreased income since March 2020, and his upcoming retirement.
[20] Shortly before the Case Conference on August 17, 2021 before a Dispute Resolution Officer (DRO), Victoria agreed to provide disclosure about the children's RESPs. However, Victoria provided a number of reasons why she was unable to produce disclosure. At the end of June 2022, the details of the RESPs were finally produced to Craig.
[21] In December 2021, Craig retired and closed his office.
[22] On April 4, 2022, the parties attended a Settlement Conference before Justice Horkins who directed the Motion to Change to a motion, rather than a trial.
Craig's Request for Relief on this Motion to Change
[23] Craig commenced the within Motion to Change on May 17, 2021. He asks for an Order declaring that his decision to retire effective December 31, 2021 was reasonable and the corresponding reduction in his income was a material change in circumstances. Relatedly, he seeks an order allowing him to stop paying child and spousal support to Victoria as of December 31, 2021.
[24] Craig seeks an order that Victoria owes him $92,0000 as follows:
(a) Victoria still owes Craig $45,000 of the costs Justice Monahan ordered her to pay on February 4, 2019. (b) Victoria owes Craig $110,000 for the spousal support he has over-paid to her since he retired at the end of December 2021 to November 2022 (plus $10,000 a month for any additional spousal support that he ultimately pays her from December 2022 until I issue my decision in this matter). (c) Craig owes Victoria $5,500 in Table Child support since 2018, and $57,500 for his share of the children's section 7 expenses since 2018.
[25] Craig also seeks an order terminating his obligation as of December 31, 2021 to maintain Victoria as the beneficiary of extended medical, dental, and life insurance coverage.
[26] Craig seeks confirmation from the court that neither party owes further financial disclosure to the other.
[27] Finally, he seeks his legal costs.
Victoria's Request for Relief on this Motion to Change
[28] Victoria's position is that Craig unjustifiably took early retirement and should be continuing to pay her spousal support in an amount greater than previously ordered because:
(a) She stopped receiving her annual Long Term Disability (LTD) payments of $155,000 per year (net) when she turned 65 in February 2022, and she has no current independent income other than spousal support with no Cost of Living Adjustment (COLA). (b) Craig is only supporting one child (Natalie) when he was previously supporting two (Katie and Sean) and child support for Natalie ends in August 2023. (c) Craig's yearly income is historically based on his personal income for the calendar year. His corporate income for his corporation's fiscal year, which ends on March 31, is based on 9 months of the prior year and 3 months of the year in which he is reporting income. He could be earning more income. (d) Craig's realistic retirement age is 67, meaning that his self-employment income would cease in his 68th year. Most plastic surgeons work to the age of 70. (e) Craig has not provided adequate proof of his written retirement notice to his employer. Victoria has been requesting this since July 23, 2021.
[29] Victoria seeks an order that:
(a) Craig's retirement was premature and unreasonable and cannot be relied upon to find a material change of circumstances entitling him to end child and spousal support. (b) She is still owed spousal support based on compensatory and non-compensatory factors. (c) The termination of her LTD payments constitutes a material change of circumstances justifying an increase in spousal support for her. (d) Craig should increase his spousal support payments from $10,000 a month to $20,000 a month starting February 1, 2022, and the payments should be indexed for inflation. (e) Craig's annual income for support purposes for 2022 onwards should be imputed at $800,000 with her income at zero. (f) Craig owes her $222,144.94 based on: (i) Table and section 7 child support arrears pursuant to Justice Monahan's order. [1] (ii) Other Table child support arrears for Natalie (October and November 2020 and February 2021). (iii) Ongoing child support for Natalie for 2023. (g) Craig continue health coverage for her. (h) Craig reduce life insurance coverage for Natalie until August 31, 2022 in the amount of $50,000. (i) Craig provide security for his support obligations by: (i) binding his estate; and (ii) increasing life insurance coverage for her in the amount of $700,000. (j) Craig terminate his life insurance coverage for Sean and Katie. (k) Craig cover her legal costs.
Child Support and s. 7 Expenses
[30] Broadly speaking, the relief sought by the parties pertains to child support, s. 7 expenses, and spousal support issues. I will deal with the child support and s. 7 issues first.
Child Support Issues Agreed Upon
[31] The parties have narrowed the child support issues. They have agreed that:
(a) Sean was no longer entitled to child support as of April 2021. (b) Natalie will not be entitled to child support after August 2023. (c) Sean and Natale received a total of $50,356 from their RESPs since 2018. (d) The report by Steve Ranot, Craig's financial expert, correctly reflects Craig's income for support purposes from 2018 to 2020. (e) The only issue in dispute with respect to Craig's income is whether a $52,300 loan he received from OHIP during the pandemic should be added to his income in 2021.
Child Support Issues Still in Dispute
[32] The parties remain in dispute with respect to the following:
(a) Victoria's claim for Table child support from Craig in respect of Natalie for October 2020, November 2020, February 2021, May to August 2021, August 2022, and August 2023. (b) Victoria's claim for a total of $259,165 in s. 7 expenses from the start of 2018 to 2022. Craig's related request is that, rather than recalculate the apportionment of s. 7 expenses for 2018 to 2022, the court simply use the 66%/34% split that Justice Monahan ordered following the 2018 trial.
[33] Below, I deal with Table child support and s. 7 issues. However, as the analysis of the issues requires a greater understanding of Natalie's educational and personal circumstances, I will review the information about Natalie that is available from an affidavit she provided dated October 24, 2022. Natalie was not cross-examined on this affidavit.
Natalie's Affidavit
[34] Natalie deposed that she is enrolled in a Master of Education program at Queen's University that is a two-year full-time program. The M.Ed. Program has an estimated end date of August 2023. This is the second university program that she has been in enrolled in. Her first program was a concurrent Bachelor of Education / Bachelor of Fine Arts Honours degree program. The completion of both B.Ed. and B.F.A. degrees occurred concurrently over a period of 5 years. The M.Ed. program has 6 terms (Fall, Winter, Summer, Fall, Winter, Summer). She will attend school for the entire time and there are no practicums. She received her Ontario College of Teachers (OCT) certificate on September 7, 2022.
[35] She further deposed that she applied for a Teaching Assistant (TA) position for a course that was about a month long. She received approximately $500 as remuneration. She also applied for an occasional teaching position but did not secure a position. She has applied again for an occasional teaching position but has not received a position as of yet.
[36] She provided the Academic Calendar for the 2022-23 M.Ed. program which states "Normally, full-time students can anticipate needing between eighteen and twenty-four months in order to complete the degree."
[37] As part of her affidavit, she also attached a letter "to whom it may concern" which indicates that:
- She was diagnosed with a learning disability and was given accommodations during high school to support her. At Queen's she has also been approved for various accommodations. Since 2016, she has attended Queen's University and during the school years she has either lived in residence or in an apartment.
- She does not consider herself to be in a common-law relationship, which relationship goes against her beliefs (both religious and personal). She shares her apartment and lease with a roommate who she is financially independent of. They do not have joint property or possessions and do not view themselves as a common law couple. She adds "And with regards to a physical/sexual relationship, do not interact/engage in a manner that suggests we are a married couple."
- When not at university, she lives at her mother's home in Toronto or at her mother's cottage.
Victoria's claim for Table child support from Craig in respect of Natalie for October 2020, November 2020, February 2021, May to August 2021, August 2022, and August 2023
[38] Paragraph 3 of Justice Monahan's order dated September 28, 2018 states:
The child support framework for a child who attends full-time postsecondary school away from home that was established in para. 12 of Mesbur J.'s order dated April 9, 2014 shall apply to [Sean] and [Natalie] for such time as they are in full-time attendance during the academic year such that:
I. In the months of May to August (inclusive), table child support shall be paid for a child who lives with a parent during these months, and no table child support shall be paid for a child who does not live with a parent during these months; and II. In the months of September to April (inclusive), no table child support shall be paid by either parent to the other.
October 2020, November 2020 and February 2021
[39] Victoria submits that there were three months during the school year where Natalie lived with her during her practicums and/or COVID namely, October 2020, November 2020 and February 2021. Victoria submits that, whereas it was typical prior to COVID that university students were away from home during the academic year, that was no longer true during the pandemic. She submits that Craig should pay Table child support for these three months.
[40] Craig does not agree because these months fall into the period September to April (inclusive) where no Table child support is owed by either party to the other.
[41] I agree with Craig's position. A review of Justice Monahan's decision suggests that his order was issued "given the extraordinary difficulties that these parties [had] in resolving relatively straightforward matters regarding their respective obligations for child support." To accede to Victoria's position and allow an exception based on COVID or practicums would significantly detract from the clarity and simplicity of Justice Monahan's order. Paragraph 3-II of Justice Monahan's decision clearly states that no Table child support shall be paid by either parent to the other for the months of September to April (inclusive). I would leave it at that and decline Victoria's request for Table child support during the three months in question.
[42] In the alternative, if Craig is required to pay Table child support for these three months, the parties agree that Craig's Guidelines income for 2020 is $798,772 as determined by Mr. Ranot.
[43] I address the controversy over Craig's Guidelines income for 2021 in the next section.
May to August 2021
[44] There seems to be a disconnect between Craig's position in his October 26, 2022 affidavit where he states that he does not owe any child support for Natalie after April 2021, [2] and his position at the hearing where he seeks an order that child support for Natalie be terminated at the end of April 2022.
[45] In any event, I understand that Craig's position is that he should not have to pay Table child support for Natalie for the period May to August 2021 because he does not believe that Natalie was living with Victoria for these summer months. He relies on evidence that Victoria paid for two months of Natalie's share of the rent for Natalie's apartment in Kingston by way of e-transfers dated June 8 and July 28, 2021. However, Victoria produced the rental lease agreement for Natalie's apartment in Kingston which indicates that the lease ran from August 1, 2021 to July 31, 2022. Victoria submits that on June 8, 2021 she provided Natalie's share of the rental deposit which was $725 (i.e. half of the $1,450 monthly rent) and then, on July 28, 2021, she paid Natalie's share of the August 2021 rent.
[46] I am satisfied with Victoria's explanation and find that, from May to August 2021, Natalie was living with Victoria. Since Craig appears to have agreed that Natalie continued to be a child of the marriage during this timeframe, and since this summer period is covered by section 3-I of Justice Monahan's order, I find that Craig should pay child support for the May to August 2021 period in respect of Natalie.
[47] The parties disagree about what Craig's 2021 Guidelines income should be. Victoria, relying on her financial expert Paula White, submits that it should be $655,988 because Craig will not ultimately have to pay back an OHIP loan worth $52,343. Craig submits it is $603,645 relying on Mr. Ranot's income report and the fact that OHIP has not cancelled the loan.
[48] Victoria produced an OHIP bulletin that suggests that OHIP will seek to recover the loan from the payee's remittances. However, since Craig has retired, OHIP will never really be able to recover its loan. A loan that is not paid back should be reported as income.
[49] On balance, I am persuaded that Victoria's position is the more likely scenario, particularly as this issue was argued in late November 2022 and Craig had still not paid back, or been contacted by OHIP to pay back the loan. Accordingly, I find that Craig's 2021 Guidelines income is $655,988.
August 2022 and August 2023
[50] Victoria asserts that Natalie lived with her during the month of August 2022 and, as per Justice Monahan's order, Craig should pay Table child support for this month. She further asserts that, as Natalie's lease will terminate in July 2023, Natalie will need to live with her for the month of August 2023. The parties agree that child support for Natalie will end after August 2023.
[51] Craig disagrees and submits that, as of April 2022, Natalie was no longer a child of the marriage under the Divorce Act, R.S.C., 1985, c. 3 (2nd Supp.). He submits that Natalie:
(a) had completed the first year of her M.Ed. program and her 6th year of post-secondary studies in university; (b) turned 23 years old in August 2021 and was living with her boyfriend in Kingston; (c) had at least $50,000 in savings, in addition to having the ability to work and contribute to her own support.
[52] Victoria notes that Justice Monahan declined Craig's request that his child support obligations end upon the completion of the children's undergraduate degrees. At para. 186 of Justice Monahan's Reasons, he held that it was premature to make a determination as to the duration of Sean and/or Natalie's entitlement to child support.
[53] Victoria also notes that the parties are both physicians who spent many years in post-secondary education so it should not be surprising that their children wish to pursue graduate studies. Child support is based on the "conditions, means, needs and other circumstances" of the child, and not on an artificial upper limit on post-secondary education.
[54] Victoria produced a text conversation where Natalie indicated that she was still in "full-time" studies during the second year of her M.Ed. Natalie advised that she was taking an independent study course, as well as a course that encompasses her writing up her Master's project.
[55] I start my analysis by observing that subsection 2(1) (b) of the Divorce Act states that a "child of the marriage" means a child of two spouses or former spouses who, at the material time, is the age of majority or over and under their charge but unable, by reason of illness, disability or other cause, to withdraw from their charge or to obtain the necessaries of life.
[56] In Licata v. Shure, 2022 ONCA 270 at para. 33 the Court of Appeal stated:
When a parent claims child support for a child who is at the age of majority or older, that parent has the onus of proving that the child remains under parental charge. This onus can be satisfied by identifying circumstances such as, for example, the child being enrolled in higher education. [Citations omitted]
[57] In Licata, the Court of Appeal also referenced the Farden factors, which assist in determining whether an individual is a "child of the marriage": Farden v. Farden, 1993 BCSC 2570, 1993 CarswellBC 619, at para. 15.
[58] The Farden factors are:
(1) whether the child is in fact enrolled in a course of studies and whether it is a full time or part time course of studies; (2) whether or not the child has applied for, or is eligible for, student loans or other financial assistance; (3) the career plans of the child, i.e., whether the child has some reasonable and appropriate plan or is simply going to college because there is nothing better to do; (4) the ability of the child to contribute to his own support through part-time employment; (5) the age of the child; (6) the child's past academic performance, whether the child is demonstrating success in the chosen course of studies; (7) what plans the parents made for the education of their children, particularly where those plans were made during cohabitation; (8) at least in the case of a mature child who has reached the age of majority, whether or not the child has unilaterally terminated a relationship from the parent from whom support is sought.
[59] For the reasons that follow, based on the Farden factors and related jurisprudence, I find that Natalie continued to be a child of the marriage past April 1, 2022 and until she completes the second year of her M.Ed. degree in August 2023.
[60] In Makdissi v. Masson, 2017 ONSC 6498, at para. 25, the court stated:
The operative words here are "under their charge" and "unable by reason of … other cause to withdraw from their charge". In short the parent seeking child support must be supporting the child and it must be reasonable for him or her to do so because the child is not able to support him or herself. It is well established that attendance at post-secondary education will satisfy this test but it is rare for the court to find that the obligation to pay support continues once the child has earned two post-secondary degrees. The question however is not whether there is a magical bright line cut-off after one or two university degrees. There is not. The question is whether the parent seeking support remains financially responsible for the adult child and whether or not that is reasonable under all of the circumstances. The key consideration is dependency. [Footnotes omitted.]
[61] I find that Craig agreed to support Natalie during the first year of her M.Ed. Therefore, it is not the case that he considers his child support obligations to have ended because she is pursuing a graduate degree.
[62] The majority of the Farden factors point toward Natalie continuing to be a child of the marriage even though she is presently 24 and will turn 25 in August 2023 when she expects to complete her graduate degree.
[63] I find that Natalie is in a full-time program of studies and that, while she has made some efforts to earn income and support herself, these efforts have not generated sufficient income. I place little weight on the fact that she has a learning disability. Rather, I find that she is and should be focused on completing her M.Ed. project work, which detracts from her being able to earn sufficient income to be independent.
[64] I find that Natalie is living with her boyfriend. The wording of her affidavit is written in a defensive manner. She may not consider herself in a common-law relationship but the evidence suggests that she is living with her boyfriend. There was no evidence that her boyfriend was supporting her which is the real issue.
[65] In case this becomes an issue, I find that Natalie will no longer be a child of the marriage after August 2023 regardless of whether she has completed her M.Ed. degree. I find that, by the end of August 2023, she will have completed 7 years of post-secondary studies. She will be 25 years old. She will have been living away from her parents for many years. The evidence suggests that she has at least $50,000 in savings. By that point, she will no longer be dependent on her parents. She may choose to live with her mother, but that does not qualify her as a child of the marriage.
Victoria's claim for a total of $259,165 in s. 7 expenses from the start of 2018 to 2022
[66] Victoria submits that she paid $259,165 in s. 7 expenses between 2018 to 2022 that Craig should contribute to on a proportionate basis. She submits that the expenses fall into the categories of permissible s. 7 expenses as determined by Justice Monahan.
[67] Craig responds that it is difficult to understand Victoria's s. 7 charts and the hundreds of pages of receipts she has filed in support of her s. 7 claims. It appears that the $259,165 in s. 7 expenses was incurred from the start of 2018 to the end of the first year of Natalie's Master's degree in August 2022.
[68] Craig submits that, even if he were to accept all the claimed expenses as legitimate, $50,356 that Sean and Natalie received from the RESPs (called EAPs in this matter) should be deducted from the $259,165 as this would be consistent with Justice Monahan's direction at paras. 175 and 178 of his 2018 Reasons.
[69] Further, Craig suggests that instead of reviewing the hundreds of pages of receipts that Victoria has filed, which is precisely what Justice Monahan said his Order was designed to avoid, the Court should simply deal with the s. 7 expenses by using the $30,000 a year limit per child that Justice Monahan suggested: see para. 184 of Justice Monahan's Reasons and para. 52 of his Costs Award.
[70] Finally, Craig urges the court to simply use the 66%/34% split that Justice Monahan directed in his Order in terms of the parties' proportionate sharing of s. 7 expenses.
[71] Victoria submits that Justice Monahan did not order a $30,000 cap on s. 7 expenses per child per year. She points out that there is nothing about $30,000 in Justice Monahan's Order. Finally, she submits that, while there is a reference to $30,000 in Justice Monahan's Reasons, reasons do not constitute an order: Singh v. Heft, 2022 ONCA 135 at para. 17.
[72] While I agree with the proposition that reasons do not constitute an order, I find that it is very clear that Justice Monahan intended that the s. 7 expenses be capped at roughly $30,000 per year per child in order to avoid the very problem that now presents itself – Victoria filing a grab-bag of s. 7 expenses, some of which may be legitimate and others that may not be. For instance, included in the list of expenses are questionable items like a sandwich from a Subway chain, and clothing.
[73] The logical starting point is para. 8 of Justice Monahan's Order which states:
- As of January 1, 2018, the permissible s. 7 expenses for each of Sean and Natalie shall be limited to the following: I. tuition and other mandatory academic fees; II. academic supplies (including books, art supplies for Natalie and a computer for each of Sean and Natalie); III. housing, consisting of rent, utilities, Internet, and telephone; IV. uninsured medical expenses actually incurred of up to $1,500 per year per child, including costs for therapy; and V. a lump sum payment of $600 per month during the academic year to cover general living expenses.
[74] Justice Monahan also made it clear at paras. 175 and 178 of his Reasons that s. 7 expenses only kick in once contributions from educational savings plans and scholarships are made. Here, the parties agree that Sean and Natale received a total of $50,356 from their RESPs since 2018.
[75] Para. 184 of Justice Monahan's Reasons states:
[184] I would therefore provide a lump-sum payment of $600 per month for each of Sean and Natalie (for a total of $4,800 over the eight months of the academic year) to cover all of their day-to-day living expenses. Combined with the other expenses identified above, this will provide each of Sean and Natalie with approximately $30,000 per year to fund their post-secondary education, which exceeds the estimated costs per year as set out on the Wilfrid Laurier University website.[footnote omitted] If either Sean or Natalie wishes to spend in excess of those amounts, they will have to fund those costs themselves. This is entirely appropriate given that s. 3(2)(b) of the Guidelines requires that the means, in addition to the needs, of a child over the age of majority should be taken into account in determining the appropriate level of child support. (emphasis added)
[76] Further, para. 52 of Justice Monahan's Costs Award states:
[52] Mention should also be made of Craig's May 28, 2018 offer to settle the issue of s. 7 expenses. As described above, Craig offered to simply fix the University expenses for Sean and Natalie at an amount ranging between $22,000 and $28,000 per year. This was a sensible and cost-effective way of resolving the matter, since it would have avoided the necessity of the parties annually reviewing and disputing individual expense items, an exercise which was simply not worth the time or expense involved. In fact, Craig's proposal was similar to that adopted by the court at trial, where I specified certain allowable s. 7 expenses and then provided for a lump-sum payment of $600 per month for each of Sean and Natalie to cover all of their day-to-day living expenses. The result was to provide each of Sean and Natalie with approximately $30,000 per year to fund their postsecondary education, while avoiding the necessity for the parties to have to engage with each other in reviewing individual expense claims. This $30,000 annual expense amount is just slightly above Craig's proposal in his May 28, 2018 offer to fix the annual university costs for each child at up to $28,000. (emphasis added)
[77] With respect to Singh v. Heft, while I agree that an appeal lies from an order and not from the reasons for decision, no party appealed or is trying to appeal Justice Monahan's Motion to Change decision or Costs Award. Instead, this issue is whether this court should strike out in a completely different direction than did Justice Monahan, particularly as he was at pains to try to set the parties on a course that would avoid, or at least reduce, further litigation. I find that it would be highly inadvisable to change course as no particular rationale for doing so was presented by Victoria. I find that the direction that Justice Monahan sets out in his Reasons and Costs Award makes eminent sense. Accordingly, I would address Victoria's claim of $259,165 in s.7 expenses for 2018 to 2022 as follows.
[78] First, I would recognize that the only two children that were eligible for s. 7 expenses from 2018 onwards were Sean and Natalie. Second, I would recognize that Sean had two years and Natalie had four years of expenses for a total of six. Third, I would apply a cap of $30,000 per child per year for s. 7 expenses which amounts to $180,000 (6 x $30,000). Fourth, I would deduct $50,356 which represents the RESP contributions which must first be applied to any eligible expenses to arrive at $129,644. Finally, I would apply the 66%/34% split for s. 7 expenses arising out of Justice Monahan's Order, rather than re-calculate the apportionment of s. 7 expenses based on the parties' incomes between 2018 and 2022.
[79] Doing the above calculations results in Craig being responsible for $85,565 in s. 7 expenses, and Victoria being responsible for $44,079.
Spousal Support
Was Craig justified in retiring when he did?
[80] Craig claims that he decided to retire at the age of 64 for three main reasons:
(a) COVID-19 had a devastating effect on his professional income; (b) COVID-19 made his job intolerable; and (c) The parties had always planned to retire as early as possible.
[81] Craig does not rely on a medical disability for his retirement, albeit he cites his declining health as a factor that contributed to his decision. In questioning, he acknowledged that he was tired of working.
[82] While accepting Craig's right to retire early, Victoria submits that his retirement was premature and unreasonable. She disagrees with each of Craig's reasons for retirement. She submits that Craig's OHIP income remained the same during early, mid, and late stages of the COVID-19 pandemic as it was before the COVID-19 pandemic. She acknowledges that his non-OHIP income was reduced but notes that it was not nil nor what Craig suggested in his questioning. She submits that Craig's information should not be relied upon and does not give an accurate picture of the status of his department in mid-2021. She submits that, during the COVID-19 pandemic, there were other employment opportunities for senior plastic surgeons that Craig failed to take advantage of, and that some of those opportunities would have removed some of the burdens Craig claims he was facing as a self-employed physician.
[83] Victoria also submits that Craig took this "voluntary" step of retirement in the face of her losing her LTD benefits and his knowing that Natalie was still in school and dependent on her parents. She denies that Craig's reasons for retirement are in any way comparable to her own. She asserts that she had no choice to retire at the age of 51 due to a medical disability (i.e. her degenerative eye condition), whereas Craig simply chose to stop working because he no longer felt like doing so, and to avoid his support obligations. She suggests that most plastic surgeons retire at 70 and that it is more realistic for Craig to retire when he is 67.
[84] Craig relies on his financial expert Steve Ranot who provided an updated calculation of Craig's income in a report dated September 8, 2022. Ranot calculated Craig's income as follows:
| Projected 2022 | 2021 | 2020 | 2019 | 2018 | 2017 | 2016 | 2015 | 2014 | |
|---|---|---|---|---|---|---|---|---|---|
| Professional Income | $320,230 | $487,244 | $690,489 | $641,035 | $688,283 | $659,066 | $504,981 | $619,378 | $652,699 |
| Investment Income | $92,127 | $116,401 | $108,283 | $127,236 | $179,735 | $67,647 | $235,231 | $167,472 | $157,516 |
| Income from non-recurring items | $0 | $0 | $0 | $0 | $0 | $0 | $0 | $27,000 | $267,718 |
| $412,357 | $603,645 | $798,772 | $768,270 | $868,018 | $726,713 | $740,212 | $813,850 | $1,077,933 | |
| Rounded | $412,000 | $604,000 | $799,000 | $768,000 | $868,000 | $727,000 | $740,000 | $814,000 | $1,078,000 |
[85] Victoria's financial expert, Paula White, accepts Mr. Ranot's report with three caveats:
(a) She claims that Craig received an OHIP loan of roughly $52,000 in 2020 that she does not believe will ever be repaid. (b) Since Victoria does not accept the legitimacy of Craig's retirement, his income in 2022 onwards should be $800,000 or higher. (c) Craig's income could potentially be higher subject to the expert receiving answers to her outstanding questions.
[86] Section 17 of the Divorce Act permits the variation of an existing support order:
17 (1) A court of competent jurisdiction may make an order varying, rescinding or suspending, retroactively or prospectively,
- (a) a support order or any provision of one, on application by either or both former spouses;
- (b) a parenting order or any provision of one, on application by
- (i) either or both former spouses, or
- (ii) a person, other than a former spouse, who is a parent of the child, stands in the place of a parent or intends to stand in the place of a parent; or
- (c) a contact order or any provision of one, on application by a person to whom the order relates.
Factors for child support order:
(4) Before the court makes a variation order in respect of a child support order, the court shall satisfy itself that a change of circumstances as provided for in the applicable guidelines has occurred since the making of the child support order or the last variation order made in respect of that order.
Factors for spousal support order:
(4.1) Before the court makes a variation order in respect of a spousal support order, the court shall satisfy itself that a change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order or the last variation order made in respect of that order, and, in making the variation order, the court shall take that change into consideration.
[87] In Justice Monahan's 2018 trial decision, he explained the two-step process required before a variation order can be made:
[189] As the Supreme Court of Canada noted in L.M.P. v. L.S., [footnote omitted] an existing support order can be varied pursuant to s. 17 of the Act only when there has been a material change in the conditions, means, needs or other circumstances of either spouse since the making of that order. A two-step process is mandated. First, the Court must determine whether there has been a change in the condition, means, needs or circumstances of either spouse since the order was made. The change must be "material", meaning that it must be a change that, if known at the time, would likely have resulted in different support terms.
[190] What amounts to a material change will depend on the actual circumstances of the parties at the time of the order. In general, a material change must have some degree of continuity and not merely be a temporary set of circumstances. The burden is on the party seeking the variation to establish the material change in circumstances.
[191] Assuming the threshold condition requiring the existence of a material change has been satisfied, the second stage of the analysis is to determine the extent of change in the existing order that is appropriate. A Motion to Change is not a hearing de novo; any variation in the order should be limited to changes justified by the material change, in accordance with the objectives set out in s. 17(7) of the Act.
[88] In St-Jean v. Fidgen, 2017 ONSC 7680 at paras. 37 and 38, Trousdale J. held that a wide variety of factors are considered as to when a support payor may reduce or terminate spousal support upon retirement:
[37] Whether a support payor spouse may seek a reduction or termination of spousal support upon retirement depends on an examination of the individual facts and circumstances of each case which may include: (a) The age of each party at the date of separation and at the current date; (b) The length of the marriage; (c) Whether there were children born of the marriage; (d) The role which each party played in the marriage; (e) The financial circumstances of each party at the date of separation and at the current date including income, expenses, assets and debts; (f) Whether either party has re-partnered; (g) The medical situation of each party if relevant, supported by medical evidence; (h) Whether there has been a material change in circumstances of either party; (i) Whether the spousal support was needs-based support or compensatory support or contractual support or some combination thereof; (j) The period of time subsequent to separation and/or the order that the support payor spouse has paid spousal support; (k) What the intention of the parties was at the date of the order and/or the date of the separation agreement, if ascertainable from the order and/or separation agreement; (l) Whether the order and/or separation agreement dealt with the issue of retirement or with the issue of age of retirement; (m) The reasons for retirement including whether the retirement was voluntary or was beyond the control of the support payor spouse; (n) Whether either party has any economic advantages or disadvantages arising from the marriage or its breakdown; (o) Whether there are 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; (p) Whether there is any economic hardship of the former spouses arising from the breakdown of the marriage; (q) Whether each spouse is or may become economically self-sufficient within a reasonable period of time; (r) What, if any, is the range of spousal support provided for pursuant to the Spousal Support Advisory Guidelines on the parties' incomes at the current time; and (s) Any other relevant circumstance.
[38] In my view, there is no hard and fast rule to be applied in every case about when or at what particular age a support payor is entitled to retire and seek a reduction or termination of spousal support. An examination of the facts of each particular case is required and this examination may result in a different conclusion in different cases depending on the specific facts of each case.
[89] I find that Craig was entitled to retire when he did and that his retirement constitutes a material change of circumstances under section 17(4.1) of the Divorce Act.
[90] On the personal side, I note that Craig decided to retire just before his 64th birthday. He had been working as a physician for 40 years and at St. Joseph's Hospital for 35 years. On Craig's age alone, I find this a reasonable age to retire and place little weight on Victoria's anecdotal evidence that most plastic surgeons retire at 70. She presented no rationale for why it was acceptable for him to retire at 67, but not at 64.
[91] I note that, at the trial before Justice Mesbur in 2014, Craig testified that he "certainly [did] not see [himself] working past sixty-five years of age," and Justice Mesbur noted this in para. 213 of her judgment.
[92] I disagree with Victoria that there is some uncertainty about whether, when, or how Craig retired. In his Motion to Change before me, Craig produced a printout of his member status at the College of Physicians and Surgeons of Ontario (CPSO) which confirmed his resignation from membership as of February 2, 2022. Craig also produced a printout of his Office Closure Notice indicating that his office is permanently closed as of December 24, 2021.
[93] Craig explained that there was a 34% decline in his professional corporation's gross professional revenue between fiscal 2020 and fiscal 2021. [3]
[94] The financial evidence suggests that COVID-19 had a significant impact on Craig's income, albeit I would not characterize it as "devastating." Mr. Ranot found Craig's income for 2019 to 2022 to be:
| 2019 | 2020 | 2021 | 2022 |
|---|---|---|---|
| $768,000 | $799,000 | $604,000 | $412,000 |
[95] Even if I added a contentious $52,000 loan from OHIP back into Craig's income for 2021, on the reasoning that OHIP will not realistically expect Craig to pay back the loan, that takes his income for 2021 to $656,000, which is significantly less than the $850,000 income that Craig's spousal support payments have been based on since Justice Mesbur's decision in 2014. It is also considerably less than the $760,589 Guidelines income that Justice Monahan premised Craig's child support calculations on.
[96] While I find it more challenging to assess the true impact that COVID-19 had on Craig's professional practice, I accept his overall argument that COVID-19 created a number of financial, operational, and administrative burdens on his professional life. I accept that he had to work longer hours to generate reduced levels of income. I accept that the "on again, off again" hospital closures, staffing issues, policy changes, and heightened risk of contracting and exposing family member to COVID-19 created a strong rationale to take early retirement. As Chief of the plastic surgery department at St. Joseph's, a position that he held until July 2021, I accept that he had added administrative responsibilities due to COVID-19. He deposed that he constantly had to fight with hospital management to try, without much success, to get more operating room time for all members of his department, including himself.
[97] I accept Craig’s evidence that the impact of COVID-19 on his professional life and income was not transitory and lasted from the onset of the pandemic in March 2020 to the time of his retirement in December 2021. The material change in circumstances had a sufficient degree of continuity.
[98] I do not accept Victoria's submission that Craig retired largely in an attempt to avoid his financial obligations towards her and the children. Victoria simply recycles many of the same arguments that she has raised in the litigation before Justice Mesbur and Justice Monahan which the court rejected. For instance, at Schedule C (Victoria's attempts to resolve some of the issues) and Schedule D (Craig's Income Disclosure is Contradictory) of her factum, Victoria provides a number of points detailing how difficult and unreasonable Craig has been throughout the litigation. Once again, Victoria alleges that Craig has not been forthcoming with his disclosure or information about his health issues, and unreasonable about the legal positions that he has taken. I find many of these arguments are "process" arguments that do not substantively refute why, at the age of almost 64, it was unreasonable for Craig to retire. Ultimately, Victoria's suggestion that Craig's realistic retirement age is 67 is based on speculation and she adduced no objective evidence to support this assertion.
[99] A payor's retirement is a material change in circumstances if the decision to retire was reasonable in all of the circumstances: Smith v. Nicholson, 2016 ONSC 2743 at para. 92; Walts v. Walts, 2016 ONSC 4777 at paras. 19-20.
[100] Some of the other St-Jean factors that lead to the conclusion that Craig's decision to retire was reasonable are that:
(a) Craig kept Victoria apprised of the impact that COVID-19 was having on his practice, and formally notified her of his plan to retire more than 8 months before doing so. (b) While Craig never relied on the argument that health factors prevented him from working, I accept that, given the nature of Craig's job - being required to stand and operate for long periods of time - his concern over his declining health was a legitimate factor in favour of taking an earlier retirement. (c) This was a 17-year marriage, the parties separated in 2010 and Craig has been paying support for 12 years. Victoria received a significant equalization payment following the financial trial in 2014 and a further 9 years since then has passed. (d) With respect to the children, they are now adults and two of them, Katie and Sean, are independent.
[101] As some of the factors relate to whether and to what extent there is economic hardship on Victoria as the support recipient, or whether Victoria ought to have been self-sufficient by now, I will turn to the evidence in respect of those factors.
Should Craig's Spousal Support Payment to Victoria end?
[102] The parties agree that, once a support payor has established a material change in circumstances, the appropriate level of support is governed by the Supreme Court of Canada's decision in L.M.P v. L.S., 2011 SCC 64, [2011] 3 S.C.R. 775 at para. 50:
[50] In short, once a material change in circumstances has been established, the variation order should "properly reflec[t] the objectives set out in s. 17(7), . . . [take] account of the material changes in circumstances, [and] conside[r] the existence of the separation agreement and its terms as a relevant factor" (Hickey, at para. 27). A court should limit itself to making the variation which is appropriate in light of the change. The task should not be approached as if it were an initial application for support under s. 15.2 of the Divorce Act.
[103] I accept that, just because Craig has retired and his professional income has ceased which has caused a material change in circumstances, it does not necessarily follow that he should be entitled to reduce, let alone terminate, his spousal support to Victoria. However, the question is whether, in the revised circumstances of the parties, it would be appropriate to terminate spousal support for Victoria.
[104] From 2014 to date, Craig has been paying Victoria $10,000 a month in spousal support based on an imputed annual income of $850,000. Craig agreed to the $850,000 figure shortly before the trial before Justice Mesbur in 2014 and she used that figure for spousal support purposes. Following Craig's first Motion to Change trial in 2018, Justice Monahan did not order any changes to spousal support.
[105] Craig relies on a number of arguments to end his spousal support of Victoria effective December 31, 2021. These include that:
(a) Victoria's net worth is significantly greater than his. (b) Victoria has mismanaged her finances and refused to take reasonable steps towards self-sufficiency. (c) Victoria is capable of earning more investment income than Craig, and Craig's investment income will continue to be approximately $125,000 annually.
[106] Victoria disagrees with all of Craig's arguments and submits, inter alia, that:
(a) There has been a material change of circumstances on her side as she ceased receiving LTD income of approximately $240,000 ($155,000 net) per year in February 2022. (b) As Sean ceased being a child of the marriage for support purposes in May 2021, Natalie started her second program of education, a Master's in Education, in September 2021 which will end in September 2023 warranting a change in child support (Table and s. 7). (c) Craig has re-partnered and remarried in 2017, whereas she has not.
Dispute over the parties' Net Worth
Craig's Net Worth
[107] In Craig's October 21, 2022 Financial Statement, he claims a net worth of approximately $4,052,000. He claims that his net worth is based on:
(a) His solely owned home in Toronto on Fishleigh Drive, with a net value of approximately $1,032,000. (b) His 50% interest in a cottage located on Cressy Bayside in Picton, Ontario jointly owned with his wife with a net value of approximately $364,000. (c) His vehicles which have a value of roughly $27,000. (d) His personal investments with RBC that have a net value of approximately $287,000. (e) His bank accounts that have a value of $38,000. (f) His RRSPs with RBC and MD Management that have a net value of approximately $1,000,000. (g) His interest in his professional corporation (Dr. Craig Fielding Medicine Professional Corporation) with a value of $1,764,372 as of March 31, 2022 as determined by Mr. Ranot. Craig adds, however, that his corporation's value has fallen to approximately $1,564,000 since March 31, 2022 because one of its primary assets, an investment portfolio with BC Wealth Management, has fallen by more than $260,000. (h) He has credit card debt of $9,229. (i) He has a significant debt of $250,000 based on a loan to his wife, the funds from which he used to pay down a tax debt.
[108] By contrast, Victoria submits that the correct value for Craig's net worth is $5,244,925.41. She arrives at this figure based on:
| Item | Craig’s Value | Victoria’s Value | Difference |
|---|---|---|---|
| Craig’s home on Fishleigh Ave. | $1,031,835.94 | $1,017,145.94 | -$14,690 |
| Craig’s interest in his cottage | $363,604 (based on 50% ownership with current wife) | $1,057,955 | $694,351 |
| Craig’s personal investments with RBC | $287,162.23 | $287,162.23 | $0 |
| RRSPs (with RBC and MD Management) | $999,505.83 | $999,505.83 ($805,484.25 + $194,021.58) | $0 |
| Craig’s interest in his professional corporation | $1,564,372 | $1,764,372 | $200,000 |
| Bank Accounts | $38,049.69 | $38,049.69 | $0 |
| Cars | $27,388.50 | $27,388.50 | None |
| Adjustment [4] | $0 | $100,625.00 | $100,625.00 |
| Debts – Loan from Craig’s wife | -$250,000 | $0 | $250,000 |
| Debts – RBC Credit Line | -$9,229.09 | -$9,229.09 | $0 |
| $4,052,689.10 | $5,244,925.41 | $1,192,236.31 |
[109] The parties' different approaches to the valuation of Craig's interest in his cottage contributes a difference of $694,351. Victoria has produced an appraisal of Craig's cottage by Steven Morralee, CRA, as of June 22, 2022 indicating that the market value of the cottage is $1,400,000. Once notional costs of disposition, legal fees, and capital gains of 25% are applied to the market value, Victoria calculates that the net value of Craig's interest in his cottage is $1,057,955.00. Also, notwithstanding that Craig jointly owns the cottage with his current wife, Victoria assigns 100% of the full value of the cottage to Craig, since it was purchased before he married his wife who did not contribute to it.
[110] I find that the correct net value of the cottage should be based on Mr. Morralee's appraisal, namely $1,057,955 since Craig only provided a letter of opinion by comparison. But, given Craig's joint ownership with his wife, Craig's interest in his cottage should be 50% of this figure, namely $528,977.50.
[111] The other significant deviation in the parties' calculation of Craig's net worth arises from the different approaches to the valuation of Craig's medical corporation. I prefer using the net figure of $1,764,372 as of March 31, 2022, rather than Craig's lower figure of $1,564,000. I find that Craig provided an insufficient reason, the drop in one of the securities, for using the lower number and that the higher figure should prevail.
[112] I would permit Craig to claim a $250,000 loan from his wife based on the demand note dated September 20, 2022 and the bank documentation he produced in this proceeding.
[113] I would also not make further adjustments to Craig's income to account for the $100,625 that Mr. Ranot allowed as a loan owed to a former employee.
[114] Accordingly, I determine that Craig's net worth is $4,418,062.60 or roughly $4.4 million based on the following:
| Item | Craig’s Value | Victoria’s Value | Court Determined Amount |
|---|---|---|---|
| Craig’s home on Fishleigh Ave. | $1,031,835.94 | $1,017,145.94 | $1,031,835.94 |
| Craig’s interest in his cottage | $363,604 (based on 50% ownership with current wife) | $1,057,955 | $528,977.50 |
| Craig’s personal investments with RBC | $287,162.23 | $287,162.23 | $287,162.23 |
| RRSPs (with RBC and MD Management) | $999,505.83 | $999,505.83 ($805,484.25 + $194,021.58) | $999,505.83 |
| Craig’s interest in his professional corporation | $1,564,372 | $1,764,372 | $1,764,372 |
| Bank Accounts | $38,049.69 | $38,049.69 | $38,049.69 |
| Cars | $27,388.50 | $27,388.50 | $27,388.50 |
| Adjustment [5] | $0 | $100,625.00 | $0 |
| Debts – Loan from Craig’s wife | -$250,000 | $0 | -$250,000 |
| Debts – RBC Credit Line | -$9,229.09 | -$9,229.09 | -$9,229.09 |
| $4,052,689.10 | $5,244,925.41 | $4,418,062.60 |
Victoria's Net Worth
[115] At the hearing of the within Motion to Change, Craig's counsel handed up two charts showing Victoria's Net Worth as calculated by her versus Craig. The first chart was based on Victoria's March 30, 2022 Financial Statement and the second chart was based on her October 26, 2022 Financial Statement.
| Financial Statement | Victoria's Calculation | Craig's Calculation |
|---|---|---|
| March 30, 2022 | $2,720,923 | $6,226,990 |
| October 26, 2022 | $3,330,887 | $5,757,444 |
[116] The difference in the parties' calculations of Victoria's net worth is primarily attributable to:
(a) Craig assigning a significantly higher appraisal value to Victoria's High Park home; and (b) Craig removing Victoria's alleged capital gains taxes on her cottage and Binbrook property, and notional disposition costs on her financial investments.
[117] I will examine each of these factors and decide which party's approach is correct.
The Correct Value of Victoria's Home in High Park, Toronto
[118] Focusing on the value of her High Park home, Victoria submits that she provided proof of the value of the property as follows:
| Date | Who Completed | Type | Value |
|---|---|---|---|
| May 1, 2022 | Natalia Fortes, Broker, Fortes Realty Inc., Brokerage | Letter of Opinion | $2,750,000 to $2,900,000 |
| August 26, 2022 | Monte Walls Burris, Broker of Record, Keller Williams Referred Urban, Trust Realty Group, Brokerage | Comparative Market Analysis | $2,900,00 to $3,000,000 |
| August 31, 2022 | Marco Cupido, CRA, Frontier Real Estate Appraisal Services | Appraisal | $3,100,000 |
[119] Additionally, Victoria swore a financial statement where, relying on an appraisal by Mr. Cupido, she deposed that the correct value of her High Park home is $3,100,000.
[120] Craig disagrees with Victoria's appraisal and submits that the correct value of the High Park home is $4,855,000 based on an appraisal report from Jim Parthenis of Carrington Appraisals dated August 12, 2022. Victoria's residence is a large, 2-1/2 storey single detached home with 7 bedrooms that sits on a 63' x 150' foot corner lot in the High Park area of Toronto.
[121] Victoria criticizes Mr. Parthenis for:
(a) spending very little time in the home before arriving at his figure; (b) not listening to her comments about the home, including that it had a two-car + storage room, not a three-car garage as he reported; (c) not inspecting the basement or the third floor, and not entering many rooms; and (d) relying on improper comparative properties.
[122] I decline to rely on Victoria's criticism of Mr. Parthenis' appraisal, or the earlier reports from Monte Walls Burris and Natalia Fortes. None of these parties are professional appraisers or qualified to provide opinion evidence. Instead, I prefer to focus on the differences between Mr. Parthenis' appraisal which came in at $4,855,000, and Mr. Cupido's appraisal which was $3,100,000. In my view, only Mr. Parthenis and Mr. Cupido are entitled to provide opinion evidence as experts in property appraisal. Both of them signed an Acknowledgement of Expert's Duty form.
[123] Mr. Parthenis was asked by Craig's counsel to provide a critique of Mr. Cupido's report. In his critique, Mr. Parthenis disagrees with Mr. Cupido's appraisal for several reasons:
(a) Mr. Cupido included a Cost Approach calculation in his appraisal when it was not applicable in the case of this home. The Cost Approach is a method whereby the value of the land and the construction costs of the structure are calculated separately and then added together to provide the market value. This methodology is used primarily in rural areas where comparable properties are difficult to find or are non-existent. It does not apply to developed neighbourhoods in the GTA where established communities provide a sufficient number of sales required to estimate the market value. (b) The most widely used methodology for single family residential homes like the subject home is the Direct Sales Comparison approach - that is, comparing the subject to similar homes that have sold in the area and then making adjustments of relevant features to reflect the differences between the subject and the comparables. (c) Mr. Cupido used a land value of $1,900,000 but did not include sales data to support his land value estimate. The comparable land value sales that Mr. Parthenis obtained clearly showed a land value of $3,420,000 which is substantially higher than Mr. Cupido's $1,900,000 figure. (d) Mr. Cupido inaccurately designated Victoria's home as being in Roncesvalles with two of the comparable homes (#1, #2) being in High Park. In fact, Victoria's home is in High Park and the two comparable homes are in Swansea, which is generally not as desirable a location as High Park. (e) The building cost factor that Mr. Cupido used in his Direct Sales Comparison approach was vastly different from the cost he used in his Cost Approach. (f) Mr. Cupido made several adjustments that were not required and, in some cases, he failed to make adjustments that were needed. (g) The discrepancies and exclusions resulted in a final estimate of value that was lower than what the real estate market in the subject area was shown to support.
[124] In her November 7, 2022 affidavit, Victoria refers to the fact that Monte Walls Burris advised her of inaccuracies in Mr. Parthenis' critique report. Mr. Burris is the broker who had provided a Comparative Market Analysis which concluded that the value of the home was between $2.9 and $3.0M. Mr. Burris' comments were based on his own personal observations which Victoria adopted in her affidavit as true.
[125] I am not prepared to rely on Mr. Burris' comments criticizing Mr. Parthenis' critique of Mr. Cupido’s report. First, Mr. Burris' comments as described by Victoria in her affidavit and as referred to in oral argument by Victoria's counsel do not, in fact, address Mr. Parthenis' concerns with Mr. Cupido's report. Instead, the comments relate to Mr. Parthenis' choice of comparable properties. Second, Mr. Burris' comments were not reduced to writing, and I am not prepared to rely on Victoria's description of Mr. Burris' comments. Finally, my overarching concern is that opinion evidence should not be conveyed to the court by non-experts.
[126] Accordingly, I return to the discrepancy between Mr. Parthenis and Mr. Cupido's appraisal. Mr. Parthenis' critique of Mr. Cupido's appraisal was dated October 18, 2022. The within Motion to Change was argued on November 29, 2022. There was no evidence before me that Mr. Cupido sought to respond to Mr. Parthenis' critique. I found it strange that, rather than have Mr. Cupido defend his own report, Victoria chose to have Mr. Burris comment on Mr. Parthenis' critique of Mr. Cupido’s report. Further, I note that Mr. Parthenis was the expert that the parties used for the trial in 2014. Mr. Parthenis has been qualified on multiple occasions to give expert evidence before this court. Mr. Cupido has been qualified on two occasions, but his expert opinion was not accepted on those occasions. [6] As it stands, I find Mr. Parthenis' appraisal more reliable given the concerns he expressed about Mr. Cupido's report. Accordingly, I find that the correct appraisal value of Victoria's High Park home is $4,855,000.
[127] Parenthetically, I note that in 2014, the High Park home was valued at $2.1 million: para. 193 of Justice Mesbur's decision. I confess to having some difficulty believing that in 2022, some 8 years later, the house had gone up by only $1.0 million to $3.1 million which was Mr. Cupido's estimate. I confirm, however, that I am relying on Mr. Parthenis’ expert appraisal.
Dispute over removing alleged capital gains taxes on Victoria's property, and notional disposition costs on her financial investments
[128] Craig submits that since Victoria has incurred significant legal fees and now has at least $1,459,536 in non-capital losses based on her tax filings, Victoria can use them to avoid paying taxes when she sells her properties and starts drawing on her investments and RRSPs. Accordingly, the removal of the notional capital gains taxes on Victoria's property, and notional disposition costs on investments, would increase her net worth.
[129] Victoria submits that she can carry her non-capital losses for the next 20 years. She argues that the court simply does not have evidence about her intentions to use those non-capital losses against her capital gains and notional disposition costs, and whether, at the material time, the non-capital losses would be available to her.
[130] I find that if Craig wished to rely on Victoria's non-capital losses in this litigation, there should have been some evidence on that point, either based on questioning Victoria or bringing forth expert evidence. As Craig's counsel pointed to no evidence on this point, other than the fact of the non-capital losses being available based on Victoria's tax return, I am disinclined to permit Craig to significantly increase Victoria's net worth based on the use of the non-capital losses.
[131] In conclusion, with respect to the calculation of Victoria's net worth, I would use Mr. Parthenis' appraisal of Victoria's High Park home which is $4,855,000, and I would not reduce Victoria's capital gains and notional disposition costs to zero due to the alleged availability of her non-capital losses.
Calculation of Victoria's Net Worth
[132] Based on my findings, I calculate Victoria's net worth to be $4,894,943 or approximately $4.9 million based on the following items:
| Victoria’s Home | ||
| Home on High Park Boulevard in Toronto | $4,855,000 | |
| RBC Mortgage | -$1,839,335 | |
| RBC Home Line Credit | -$97,000 | |
| Notional disposition costs | -$242,750 | |
| Subtotal | $2,675,915 | |
| Victoria’s Cottage | ||
| Cottage in Maple Leaf, Ontario | $662,500 | |
| Notional Disposition Costs | -33,125 | |
| Notional Capital Gains Taxes | -$163,875 | |
| Subtotal | $465,500 | |
| Victoria’s Other Property | ||
| Property in Binbrook, Ontario | $650,000 | |
| Notional Disposition Costs | -$32,500 | |
| Notional Capital Gains Taxes | -$64,500 | |
| Subtotal | $553,000 | |
| Vehicles and Boats | ||
| Toyota Venza and Bayliner | $9,080 | |
| Bank Accounts | ||
| RBC, CIBC, Scotiabank accounts | $214,365 | |
| Notional Disposition Costs on Investments | -$4,000 | |
| Subtotal | $210,365 | |
| RRSPs | ||
| RBC RRSP 0034 | $1,294,720 | |
| Notional disposition costs on RBC RRSP 0034 (20%) | -$258,944 | |
| MD Management RRSP 1616 | $318,204 | |
| Notional disposition costs on MD Management RRSP 1616 (20%) | -$63,641 | |
| Subtotal | $1,290,339 | |
| Credit Cards | ||
| Various Credit Cards | -$153,560 | |
| Other Debts | ||
| Neo Financial | -$153,201 | |
| Jag Arora | -$2,495 | |
| Sub-total | -$155,696 | |
| Total: | $4,894,943 |
[133] In the alternative, if I was wrong to rely on Mr. Parthenis' appraisal of Victoria's home in High Park and I should have used Mr. Cupido's appraisal of $3.1 million, and I still permitted Victoria to reduce her net worth by including capital gains and notional disposition costs, her net worth would be $3,227,693.
[134] Conversely, and also in the alternative, if I was not wrong to rely on Mr. Parthenis' appraisal but wrong to disallow the application of Victoria's non-capital losses, her net worth would be $4,894,943 + $863,335 (total capital gains and disposition losses) = $5,758,278 or roughly $5.7 million.
[135] In sum, I conclude that Victoria's net worth is roughly $4.9 million and Craig's net worth is $4.4 million. Therefore, while I disagree with Craig that Victoria's net worth is significantly greater than his, I agree that her net worth is somewhat greater than his.
Has Victoria has mismanaged her finances and refused to take reasonable steps towards self-sufficiency?
[136] Another argument of Craig's pertaining to why spousal support should terminate is that Victoria has mismanaged her finances and refused to take reasonable steps towards self-sufficiency. Pursuant to s. 17(7) (d) of the Divorce Act, a variation order is supposed to "in so far as practicable, promote the self-sufficiency of each former spouse within a reasonable period of time."
[137] In Boston v. Boston, 2001 SCC 43, [2001] 2 S.C.R. 413 at para. 54, the Supreme Court of Canada held that "as far as it is reasonable, the payee spouse should attempt to generate economic self-sufficiency." In Aquila v. Aquila, 2016 MBCA 33, 326 Man. R. (2d) 193 at para. 66, the Manitoba Court of Appeal held that "[p]rudent financial planning is to be expected from anyone appearing in family court," and that "courts should not condone irresponsible financial behaviour or enable unrealistic expectations". Also see Garnet v. Garnet, 2016 ONSC 5922 at para. 99; Haworth v. Haworth, 2018 ONSC 159 at para. 37, varied on other grounds at 2018 ONCA 1055, 145 O.R. (3d) 74; and M.B. v. S.B.B., 2018 ONSC 4893 at para. 133.
[138] Craig submits that this was a 17-year marriage, the parties separated in 2010, he has been paying support for 12 years since 2014, and Victoria has done nothing to become self-sufficient. He notes that she is living in a "5,000 square foot mansion with 7-bedrooms" that, according to her March 20, 2022 Financial Statement costs more than $106,000 a year to maintain. Craig suggests that there is no reason for Victoria to continue to live in such a home particularly when, according to Mr. Parthenis' appraisal, the home could be sold for $4,855,000. The net proceeds of sale would total approximately $2.67 million, and those funds could be used to purchase a less expensive home and still leave Victoria significant capital to invest and generate income, and reduce her annual expenses. Even if Mr. Cupido's lower appraisal of $3.1 million is adopted, she would still have net proceeds of approximately $1.0 million from the sale of the home alone.
[139] Craig argues that, not only has Victoria refused to sell her expensive and large High Park home, she has allowed it and her other properties to fall into disrepair.
[140] Craig acknowledges that Victoria stopped receiving disability benefits when she turned 65 in February 2022. Her only sources of income since that time have been the support payments she receives from Craig and her investment income. He suggests that according to Victoria's income tax returns, from 2018 to 2021 she earned an average of $134,000 a year from her investments.
[141] Craig also relies on ss. 19(1)(e) and 19(1)(g) of the Child Support Guidelines to suggest that Victoria's "property is not reasonably utilized to generate income", and she "unreasonably deducts expenses from income." Also see Mason v. Mason, 2016 ONCA 725, 132 O.R. (3d) 641 at para. 192, and Berta v. Berta, 2017 ONCA 874, 138 O.R. (3d) 81 for examples where courts have imputed parties with a reasonable rate of return on their capital.
[142] I note that Justice Monahan held, at para. 73 of his Reasons:
The determination of whether a spouse is "reasonably" dealing with his or her assets to generate income is an objective test. [footnote omitted] Reasonableness must be determined having regard to the entire context, including the extent to which a spouse is in fact generating income from their assets
[143] Victoria's counsel strongly disputes that Victoria has been irresponsible with her finances or that her continued occupancy of the High Park home is unwarranted. While acknowledging the Boston line of authority, Victoria's counsel reminds the court that Justice Mesbur made an award of indefinite spousal support to a recipient who has a permanent disability. Victoria also argues that she is entitled to live in a home that is consistent with the lifestyle that the parties enjoyed during marriage.
[144] In looking at the various factors to consider whether and to what extent to vary the spousal support order from 2014, I find it instructive to review some of the judicial commentary from Justice Mesbur and Justice Monahan:
[145] In Justice Mesbur's 2014 decision, she stated:
- Vicki testified that she and Craig focused their financial plans on being able to retire in their early fifties. (para. 10)
- The family's lifestyle was neither "modest" nor "luxurious." It was, however, more than comfortable, with no money worries at all. The family wanted for nothing, and Vicki and Craig were able to save and invest, and build up their net worth, without impinging in any way on the family's lifestyle." (para. 31)
- After equalization, each of the parties left the marriage with similar capital resources (para. 181)
- This was a reasonably lengthy marriage of just over 17 years. (para. 193)
- Vicki is entitled to spousal support, whether on a compensatory model of support or a needs-based model. (para. 208)
- Vicki's disability income will terminate when she turns 65. Craig expects to retire by the time he is 65 or so. As I see it, either or both of these events might warrant a review of spousal support. I have no idea what other circumstances might occur between now and then that could have a bearing on the issue of spousal support. (para. 213)
[146] Finally, under the heading "Duration of spousal support," Justice Mesbur declined to order either an automatic termination or review of spousal support, and left any change to be dependent on a material change of circumstances occurring.
[147] At para. 293 of Justice Monahan's 2018 trial decision he commented that:
In this case, the matrimonial home is a substantial three-story property of over 5,000 square feet, valued at over $2 million in 2014. It has seven bedrooms and a three-car garage. At the time of the trial before Mesbur J., it was contemplated that the property would be sold and Victoria would move to more modest accommodations. Instead, Victoria decided to purchase Craig's interest in the property because she hoped that retaining the family home would induce the children to return to live with her. While that was certainly her choice to make, it was a personal choice as opposed to one that was required by circumstances beyond her control and cannot constitute a "material change" for spousal support purposes.
[148] The questioning of Victoria revealed that:
(a) She has had 12 years, since 2010, to plan for the end of the payments from her disability insurance. (b) She never met with a financial planner. (c) She has only met once since 2010 with an investment advisor. (d) She hired a company to try to get a permit for the potential renovation of the second floor of her garage and to work on the basement around 2017 or 2018, but the company did not do any work. (e) Over the last three to five years, she renovated a bathroom on the third floor of her home and has been very slowly making other renovations to the third floor. (f) She does not know when the third floor will be ready to rent out. (g) She has not obtained any advice about what she may get for the rental of the third floor or the basement. (h) Binbrook, her parent's house, is flooded badly. It has flooded two or three times. She has asked some contacts of her father and neighbours to help her fix the property. (i) Since her father passed away in 2019, she has spent $85,000 fixing up and maintaining the Binbrook property. She would like to rent it out but does not know what it will cost to make it livable. She has not made any written plans with respect to the potential renovation of Binbrook. (j) Regarding Binbrook, she is doing most of the maintenance work herself or getting it for free. She has not spoken to a real estate agent about Binbrook. She does not plan on selling it. (k) Despite Craig's counsel writing to her counsel on March 14 and August 18, 2022 suggesting that she needed to meet with a financial planner and take steps to reduce her expenses by selling her High Park and Binbrook properties, she has taken no steps. (l) She appears to have dissipated about $484,000 over seven months in 2022. She refused to provide the bank and credit card statements to Craig's counsel, or to explain how much of the drop was attributable to the investment market or otherwise. (m) She has not hired a real estate agent to look into selling any of her properties and downsizing. She plans to live in her High Park home into her 90s. Her plan is to renovate rather than sell to get increased income.
[149] A major aspect of this case is that Victoria has known, since 2010, that her disability benefits would run out at the age of 65. She has known that Craig intended on retiring at around the age of 65. She had known that she ought to have downsized from the 7-bedroom house that she is living in, particularly since Justice Monahan's 2018 decision says so, and given that the children were attending out of town universities.
[150] Instead, the evidence is that Victoria has done almost nothing about financial planning or downsizing. She fully intends to occupy the High Park home well into her 80s and 90s which is currently costing her $106,000 per year, while moving very slowly in terms of renting out the third floor or basement. And, now that her disability payments have run out, she looks to Craig to not only continue paying spousal support, but double his monthly payments.
[151] When it comes to her Binbrook property, Victoria's conduct also makes little sense. It has been repeatedly flooded. When her father passed away in 2019, she received $85,000 which she sunk into that property. But she is nowhere near fixing it up or renting it out. Once again, she has no plan on selling it either.
[152] So the context in which Victoria requests further support is that she is sitting on three properties, a $4.85 million 7-bedroom house in Toronto, a cottage, and Binbrook; her net worth is greater than Craig's; she has met with an investment advisor only once since 2010; she has never met with a financial planner and, notwithstanding that Craig's counsel wrote to her and suggested that she meet with professional advisors, she has done essentially nothing.
[153] On the other side of the coin, Victoria is now 66, she has a medical disability, Craig has paid 12 years of spousal support against a 17-year marriage, and there is a combined compensatory and needs based aspect to Victoria's spousal support entitlement.
[154] In suggesting that Victoria has been irresponsible in her conduct, Craig relies on the Court of Appeal's decision in Choquette v. Choquette, 2019 ONCA 306. The facts in Choquette were succinctly described in T.I.R. v. C.F.J.D., 2020 ONSC 8140:
[27] The parties in [Choquette] separated after a 15-year marriage. Spousal support was set at $4,750 per month premised on the appellant rejoining the workforce quickly. Twenty-two years later the appellant still had not returned to work. At the same time, the respondent's income had increased from about $390,000 to over $1 million annually. The appellant had purchased rental properties which she operated at a loss and her net worth had increased from about $200,000 after leaving the marriage to about $780,000. The variation hearing judge found that the appellant had not made a serious attempt to find work and determined that it would be appropriate to terminate her entitlement to spousal support.
[28] In the Court of Appeal the appellant argued that if it was ever possible for her to become self-sufficient, it was not now a realistic objective at age 62 when her professional qualifications were stale. The Court concluded that termination of spousal support was preferable to a reduction because any economic hardship arising from the breakdown of the marriage had long been addressed through the provision of support, and any current hardship was not the result of the marriage or its breakdown, but her own choices (para. 19). (emphasis added)
[155] While each case turns on its own particular facts, the cited cases illustrate that in appropriate situations, entitlement to indefinite spousal support does not necessarily equate to perpetual spousal support: T.I.R. v. C.F.J.D., 2020 ONSC 8140, at para. 29.
[156] Victoria submits that her compensatory and needs bases for entitlement continue to exist and that the disparity in the parties’ incomes and income-producing assets is indicative of her suffering economic disadvantage arising from her role during the parties’ long-term marriage and its breakdown: Schulstad v. Schulstad, 2017 ONCA 95, at para. 51.
[157] Schulstad counsels that, in addition to looking at the parties’ net worth, I should also examine their income and the provisions of the Spousal Support Advisory Guidelines (“SSAGs”) when considering Craig’s request to terminate spousal support.
[158] The SSAGs provide a number of factors to consider in determining the appropriate quantum of support within the ranges. The three most relevant factors in this case are the strength of the appellant’s compensatory claim, her needs, and the respondent’s needs and ability to pay: Schulstad, at para. 53.
[159] I find that now that her disability benefits have terminated, Victoria’s only source of income, other than spousal support, is her investment income. I have not taken into account the fact that, according to Craig, Victoria is also eligible to convert her RRSP to a RRIF and to apply for CPP and OAS, which she has apparently not done.
[160] Craig submits that, based on Victoria’s income tax returns from 2018 to 2021, she earned an average of $134,000 a year from her investments. Craig submits that she could earn significantly more if she started taking reasonable steps to use her substantial capital base to earn income.
[161] Relying on Mr. Ranot’s income report, Craig states that he earned an average of $125,000 a year from his investments from 2018 to 2022. He submits that it is reasonable to assume that he will be able to keep earning approximately $125,000 a year from his investments. Victoria does not disagree with Craig’s estimate of his annual investment income, but she returns to her overall argument that it was premature for Craig to have retired in the first place.
[162] Having found earlier that it was reasonable for Craig to retire in December 2021, and accepting that he will only have investment income unless he starts to draw on his capital, I find that the Victoria’s financial situation is someone better than Craig’s. I find that Victoria’s net worth is $4.9 million and her annual investment income is $134,000. Craig’s net worth is approximately $4.4 million and his annual investment income is $125,000.
[163] With respect to the three most important relevant SSAGs factors, I find that Victoria’s compensatory claim is not at the high end. In Justice Mesbur’s decision, she rejected Victoria’s characterization of the marriage as one in which she did everything and Craig did nothing. But Justice Mesbur did accept that, after the birth of the children, Victoria’s practice never regained its pre-children vigour: paras. 195-197. I also note that, unlike Schulstad, which was a 24-year marriage, here the parties were married for 17 years and it cannot be said that Victoria sacrificed her career to support Craig’s career.
[164] I find that Victoria’s needs can be met if she acts in a more responsible manner with her properties, particularly her High Park home and Binsbrook. Accordingly, this is not a situation where, following Craig’s retirement and the loss of spousal support from Craig, Victoria’s reasonable needs will go unmet. As noted in the SSAG: Revised Users Guide at page 98, entitlement to non-compensatory support does not involve a permanent guarantee of the marital standard of living in medium-length marriage cases.
[165] While I accept that there has been a material change of circumstances on Victoria’s side occasioned by the termination of her disability benefits, the material change on Craig’s side resulting from his retirement means that the circumstances of both parties had changed. As per Choquette, I find that any economic hardship arising from the breakdown of the marriage has long been addressed through the provision of support by Craig for 12 years, and any current hardship is not the result of the marriage or its breakdown, but as a result of Victoria’s improvident decisions.
[166] For all the above reasons, I find that the appropriate response to the parties’ changed circumstances, is to terminate spousal support for Victoria, rather than reduce it or step it down until termination. The circumstances of the parties, keeping in mind their significant wealth, calls for finality and disengagement, not tinkering of their support arrangement. Victoria’s support should be terminated effective the end of December 2021 when Craig retired.
[167] As I have found no basis for Craig to have continued his spousal support payments past December 2021, I find that Craig has overpaid spousal support by $10,000 a month from January 2022 to the present. Since Craig is a support payor whose spousal support payments were tax deductible, a reconciliation may be required in respect of his overpayments. If the parties are unable to agree on the appropriate reconciliation, they may write to me through my judicial assistant.
Order and Costs
[168] I request that the parties send me a draft order approved as to form and content based on the foregoing. If the parties are in dispute with respect to the proposed order, they may contact the court.
[169] On the issue of costs, if the parties are unable to agree on costs before April 14, 2023, the parties shall deliver costs submissions by that date, limited to three pages, double spaced, not including the Bill of Costs, Offers to Settle and Authorities (which should be hyperlinked).
[170] The Draft Order and Costs Submissions should be directed to my Judicial Assistant, Patricia Lyon-McIndoo’s e-mail address at Patricia.Lyon-McIndoo@ontario.ca.
Footnotes:
[1] Victoria acknowledges owing Craig the sum of $44,840.28 for costs from the Order of Justice Monahan dated April 4, 2019. She undertakes to provide Craig with payment of those costs contemporaneously with the payment of arrears.
[2] Para. 62 of his October 26, 2022 affidavit.
[3] This was based on projecting the nine months that he worked for his medical corporation in 2021 over 12 months.
[4] Victoria adds back $100,625 to the value of Craig’s corporation that Mr. Ranot had deducted in respect of a loan that Craig claims is owed to a former employee, Leslie Campbell.
[5] Victoria adds back $100,625 to the value of Craig’s corporation that Mr. Ranot had deducted in respect of a loan that Craig claims is owed to a former employee, Leslie Campbell.
[6] Pechmann v. Sarah Ann Pechmann Trust, 2013 ONSC 4661 at para. 17 (c); Rudky v. Kaybaki, 2015 ONSC 6431 at paras. 46-47.
Released: March 31, 2023 Pinto J.