Court File and Parties
Court File No.: FC1039/21 Date: 2023/06/15 Superior Court of Justice – Ontario Family Court
Re: Roger Lacroix, Applicant And: Cynthia Meek, Respondent
Before: HENDERSON J.
Counsel: Meredith Rady, for the Applicant In person, for the Respondent
Heard: May 31, 2023
Endorsement
[1] The respondent seeks a temporary order for spousal support which the applicant opposes. He argues that the respondent is seeking to vary an existing interim order without demonstrating a material change in circumstances. He asks that the motion be dismissed.
[2] By way of brief background, the parties were married for thirty years separating July 14, 2021. They have five children and of these two remain in school: C who is 23 is commencing graduate work in September, and S who is 21 has just completed third year university. They live with the applicant, while a third child resides with the respondent but who is otherwise independent. The remaining two children are independent.
[3] The respondent graduated with a degree in pharmacy but has not worked outside the home since 1992. She homeschooled all five children till university.
[4] The applicant is self-employed owning a company which has rights to proprietary software which he wrote years ago. In an earlier decision I wrote in this matter, the respondent described it as “a passive business, with low overhead, since it operates on a renewing subscription model. This has created a steady income stream.”
[5] Pursuant to a consent order dated February 2, 2022, the applicant has been paying $4,126 per month in temporary spousal support. Entitlement is not an issue.
[6] The legal test for variation of a temporary order is not disputed. The jurisprudence supports the view that such motions should be discouraged, that the moving party bears the onus of demonstrating a substantial change in circumstances, and that onus is significant.
[7] The threshold question is whether the order of February 2, 2022, which was made on consent and on a without prejudice basis, is a temporary or a first interim order. If the latter, then the respondent need not show a substantial change in circumstances.
[8] The issue must be placed in the context of the litigation history to date. The application was commenced October 8, 2021. After the respondent filed her Answer, a case conference was scheduled for February 2, 2022. At that case conference, I made the following endorsement:
- Case conference held;
- Parties have agreed on the exchange of disclosure;
- Parties may bring motions if necessary;
- Leave granted for oral questioning to be completed by the settlement conference;
- On consent the applicant shall pay support for the respondent in the amount of $4,126 per month commencing January 1, 2022 on a without prejudice basis; and
- Matter adjourned to May 17, 2022 tbst to determine if disclosure completed for purposes of scheduling a settlement conference.
[9] While it is not clear from the endorsement, the amount of spousal support was drawn from a SSAG calculation attached to the applicant’s case conference brief. The relevant inputs were three children living with the applicant, the applicant’s annual income at $200,000 and the respondent’s at zero. The mid range of spousal support was $4,126.
[10] The parties changed counsel and brought motions for a variety of relief including spousal support. The motions came before me on October 12, 2022. In my endorsement of November 30, 2022, I made two orders at the outset at the request of counsel:
- The divorce was severed; and
- The “review of spousal support based on better income information” was adjourned to another day.
[11] The respondent puts forward two arguments in support of her position that she should not have to bear the onus of establishing a change of circumstances. First, she says she did not consent to the order despite the endorsement. She says there were no discussions with her counsel about the issue and he consented without instruction from her.
[12] I make no determination on that fact. This is not a satisfactory forum in which to determine such an issue especially in the absence of evidence from counsel at the time. I do know the respondent subsequently changed counsel and that no motion has been brought to set the order aside on that basis.
[13] Her second argument is that the February 2, 2022 order should be seen as a first interim or interim interim order as it is “without prejudice”. In that case, she does not need to demonstrate a change of circumstance.
[14] Boswell, J. in Oxley v. Oxley, supra described temporary orders as follows at para. 25 and 26:
[25] Temporary orders for support, as the name suggests, are not final orders. They were formerly known as “interim orders”, referencing the fact that they were intended to cover the interim period between the commencement of proceedings and trial. The Family Law Rules now use the term “temporary” to underscore the notion that they are not intended to be long term solutions. They are by their nature imperfect solutions. They are based on limited and typically untested information. They are meant to provide “a reasonably acceptable solution to a difficult problem until trial”: see Chaitas v. Christopoulos, 2004 ONSC 66352 per Sachs J.
[26] Variations of temporary orders are not encouraged. They should not become the focus of the parties’ litigation: Cutaia-Mahler v. Mahler, 2001 ONSC 28138 per Benotto J.. There is, therefore, a heavy onus on a party who seeks to vary a temporary order – essentially replacing one imperfect solution with another imperfect solution - pending trial: Boissy v. Boissy, 2008 ONSC 37900 per Shaw J.. A substantial change in circumstances is typically necessary before a variation to a temporary order will be granted: Biddle v. Biddle, 2005 ONSC 5000 per Blishen J.
[15] However, it must be recognized that not all temporary orders in the family law context are intended to carry an issue until trial. Family law issues are by their very nature evolving over the course of litigation. It is common practice that as financial disclosure is made, or parenting time develops, orders are put into place to get the parties to the next step, often long before trial. These orders are variably described as “interim interim”, “first interim”, “temporary without prejudice.”
[16] Acknowledgment of the utility of these types of orders is based on sound policy reasons. As Price, J. held in Ceho v. Ceho, 2015 ONSC 5285, starting at para. 85:
[85] To require a party to establish that a “material change of circumstances” has occurred since a “temporary temporary and without prejudice order” was made would not promote the primary objective of resolving disputes fairly in the most timely and least expensive manner. Rather, it would discourage the temporary settlement of disputes pending counselling, or questioning, or a clinical investigation by the OCL. Parties would be more likely to argue the issues prematurely in order to avoid a presumption arising from the status quo in the future. They would be less willing to adjourn a motion in the interest of counselling, or questioning, or OCL investigation, if they thought that the court, upon the return of the motion, would require proof of a material change of circumstances before it would consider the results of those steps.
[17] Ceho was cited by the respondent. In support of the view that “without prejudice” does not insulate from the change of circumstance threshold, the applicant relies on the decision of Coats, J. in Stolp v. Stolp, 2021 ONSC 3365. The subject order in that case was described as being on an “interim without prejudice basis.” Coats, J. held that the phrase “without prejudice” did not provide a lower threshold for change and at para. 24 she wrote:
There seems to be a suggestion in the Applicant’s factum that, because Doi J. used the words “on an interim without prejudice basis,” this presents a lower threshold to the Applicant’s attempt to vary same. I disagree. Doi J.’s order was clearly interim as it was to be in place until trial. At para. 21, he references that the Respondent has brought her motion “for interim support until trial.” At para. 25, in explaining his approach to determining the Applicant’s income, he states that “[i]t also recognizes the apparent discrepancies between the parties’ income estimates which I expect would likely require further factual and credibility findings based on a more developed evidentiary record that can only be resolved at trial.” His use of the words “without prejudice” simply refers to the fact that a trial judge may determine incomes to be in different amounts and, therefore, order different support levels, including retroactively.
[18] In my view the two decisions are not to be read as contradictory. I do not read the Stolp decision as standing for the principle that the term “without prejudice” can never be used to avoid the material change test. A review of the analysis of Coats, J., rather, reveals that her conclusion was more restricted. She considered the language used by the judge in rendering the interim without prejudice order. She appropriately concluded that on the reading of that decision the intent was that the order was intended to take the issue to trial.
[19] In my view, the underlying principle from Stolp is that to determine the true nature of a temporary order the court must discern the intent behind the order in the event of ambiguity. The court should consider the wording of the order itself but also the broader factual context to assist in interpretation. Depending on that interpretation, the material change test may or may not need be applied.
[20] The question for the present case is whether the order was intended to take the parties to trial or to a point down the road when spousal support may be reviewed. Taking into account the terms of the order and the broader context, the order in my view was intended to be a first temporary order. The order was made on consent at a case conference. To the extent disclosure was agreed it had clearly not been made. It was anticipated that it would be completed before the parties scheduled a settlement conference.
[21] Looking further at the pleadings, the respondent had put the applicant’s income at issue stating that she was unaware of his income. The applicant pointed to passages in the respondent’s case conference brief where she speculated on his income which was a lot more than he was disclosing. I need not comment on the propriety of references to the applicant’s comments in her otherwise confidential case conference except to say that it emphasized her concern about the applicant under reporting his income.
[22] And there was a basis for her concern. She was aware he was self-employed and therefore could control his income. In his financial statement sworn October 8, 2021, the applicant disclosed his previous year’s income as $115,184. In the budget part of the statement, he said his current income was $84,864. By the case conference, he produced a SSAG calculation based on an annual income of $200,000. The mid range spousal support was $4,126.
[23] At the time of the order then, it was evident that the applicant’s income was at issue, the parties had not exchanged disclosure and motions were contemplated. By that time, the parties were also aware that the applicant had moved from the matrimonial home and had no independent income. Leaving aside the issue of her consent, it would seem to me to make eminent sense for her to try to get some cash flow on an interim without prejudice basis at the earliest possible opportunity without having to bring a motion. The consent order was without prejudice to reviewing the support when there was better evidence of the applicant’s true income. My endorsement clearly contemplates the parties bringing motions.
[24] The parties brought their motions. As I have indicated, in my endorsement of November 30, 2022, I made an order to adjourn the respondent’s motion for “a review of spousal support based on better income information.” That better income information came in the form of an expert income evaluation conducted on behalf of the applicant. The applicant’s income according to that report was determined to be: 2019: $329,659 2020: $361,245 2021: $373,532
[25] While the respondent still questions these figures, she was prepared to accept them for the purposes of this motion. She based her SSAG calculation on the applicant’s 2021 income of $373,532.
[26] If anything, these income figures support the respondent’s misgivings at the time. They support the view that the original order was subject to review upon further disclosure and an income evaluation.
[27] In my respectful view, this is not a case of replacing an imperfect solution with another. The first order was based on an income about half of what the applicant’s own expert shows it to be. This is too large a discrepancy. There is no reason why the respondent should wait till trial to receive this difference by way of a retroactive award. It is at least 18 months until a trial. A settlement conference is scheduled in late November and a trial will follow a year later on current scheduling.
[28] Therefore, I find that, despite the able submissions of the applicant’s counsel, that the February 2, 2022 order was made without prejudice to spousal support being reviewed upon better income information from the applicant. That better income information has been received and now the review may proceed.
[29] In the event I were to agree with the respondent, the applicant submitted that for income purposes I should average the three years incomes. I would if I thought there was some fluctuation year to year. There is no fluctuation and on the basis of the evidence, there appears in fact an upward trajectory. Therefore, for the purposes of calculating spousal support, I will use the applicant’s income of 2021 in the amount of $373,532.
[30] For the purposes of input into the SSAG calculation, the applicant is claiming two dependent children. The respondent argues that there is only one, namely S, going into the fourth-year university. I agree with the respondent. The child C has now been accepted into a post graduate programme for which it is not disputed she will receive significant funding.
[31] The respondent is not working and has not worked outside the home since 1992. Although she has a degree in pharmacy, she is also 58 years of age.
[32] At this time, I am not prepared to impute income to the respondent. For SSAG calculation purposes, her income is therefore zero.
[33] The respondent produced a SSAG calculation (exhibit “H” to be her affidavit sworn May 13, 2023) based on the applicant’s income of $373,532 and her income at zero. She has also apportioned $12,000 for S’s post-secondary school costs with a tuition credit of $7,000 to the applicant. The consequent ranges are $8,570 low, $9,998 mid, and $11,426 high.
[34] Chapter 11 of the SSAGs references a ceiling income of $350,000, above which the formulas do not necessarily apply. The SSAG User Guide, when discussing the ceiling, cites several cases where if the income is not too far above the $350,000 ceiling, courts frequently order support at the low end of the range (see for example Dymon v. Bains, 2013 ONSC 915).
[35] I have considered the factors and objectives in s. 15.2(4) and s. 15.2(6) of the Divorce Act, in the context of variation motion, the respondent’s budget set out in her financial statement, and the applicant’s ability to pay. I order therefore that commencing June 1, 2023, the applicant shall pay support to the respondent in the amount of $8,570 per month. The respondent requests the order be retroactive to January 1, 2022. I am not prepared to do so and leave that issue to trial.
[36] If parties are unable to agree on costs, then the respondent shall make written submissions within 15 days and the applicant shall respond within 15 days thereafter. Submissions shall not exceed five pages not including offers to settle and bills of costs.
“ Justice Paul J. Henderson ” Justice Paul J. Henderson Date: June 15, 2023