Caughlin v. Caughlin, 2023 ONSC 7123

COURT FILE NO.: FC-18-152-0000

DATE: 2023-12-20

SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Renata Lee Templeton Caughlin, Applicant

AND:

Kenneth Blair Caughlin, Respondent

BEFORE: The Honourable Madam Justice R. S. Jain

COUNSEL: Applicant was Self-Represented Melina Feeley, Counsel, for the Respondent

HEARD: May 29, 2023 through to June 2, 2023

Reasons for decision

Introduction & Background

1This Application was commenced in February 2018 – more than five years ago. The litigants may blame the global pandemic for the delay in reaching a trial. However, this matter had been proceeding without making very much progress for two years prior to the Court’s suspension of regular operations during the pandemic.

2The Applicant is fifty-four (54) and the Respondent is fifty-eight (58) years old.

3The parties married on February 14, 1999, and separated after nineteen years on February 6, 2018. They have one child together, namely Bradley born August 12, 2006. At the time of separation, he was eleven years old. At the time of the trial, he was sixteen years old. The parties settled all the parenting issues by way of a Final Consent Order of Eberhard J. dated August 28, 2019. Bradley resides with both parties in their “joint custody.” His primary residence is in accordance with his wishes and preferences.

4This trial came before me on financial issues, namely child support, valuation and equalization of the parties’ business interests, and spousal support. Specifically, the issues in dispute are the determination of the parties’ incomes; determination of retroactive and ongoing child support; the valuation and equalization of each party’s respective businesses; and the Applicant’s claim for retroactive and ongoing spousal support.

5The issues of equalization of the businesses and post-separation adjustments were not complicated. What complicated this matter and caused such significant delay in reaching a final resolution was the high level of conflict, lack of disclosure and lack of trust between the parties. In my view, they used this trial to vent their grievances and complaints and continue to blame each other for all their challenges.

6Both parties used an inordinate amount of time during the trial giving evidence regarding how terrible the other party behaved during the marriage and after the separation. Most of this evidence was irrelevant to the substantive issues before the court. However, it did highlight for me how the high level of conflict and distrust between these parties coupled with the lack of disclosure, were large contributors to the reasons why this matter did not resolve prior to trial.

Issues

7The questions this court must answer are as follows:

1. What are the incomes of the Applicant and Respondent? Should the court impute income to the Applicant and/or Respondent?

2. What is the appropriate quantum of retroactive and/or ongoing child support payable for Bradley?

3. Is the Applicant entitled to spousal support? If so, what is the appropriate quantum of retroactive and/or ongoing spousal support payable by the Respondent to the Applicant?

4. What is the value and equalization of each party’s respective business interests and post-separation adjustments?

Procedural Issues

8The trial commenced on May 29, 2023. For their evidence in chief, the Applicant and Respondent both confirmed they were adopting and relying upon their trial affidavits. The Applicant’s affidavit is dated March 15, 2023 (Exhibit 1 or the Applicant’s affidavit) and the Respondent’s affidavit is dated March 30, 2023 (Exhibit 2, or the Respondent’s affidavit). They also confirmed they would be giving additional oral evidence through evidence in chief and cross-examination. On consent, all other witnesses were struck from the witness list. As a result, certain materials (a letter from one witness and an affidavit from another witness) were removed from the parties’ trial affidavits. Each party filed and relied upon affidavit evidence from their accountant Ms. Sue Bragg. The Applicant’s affidavit from Ms. Bragg was dated March 15, 2023 (Exhibit 3). The Respondent’s affidavit from Ms. Bragg was dated March 31, 2023 (Exhibit 13). Neither party called Ms. Bragg as a witness.

9The Applicant brought an oral motion to remove the Respondent’s counsel Ms. Feeley as solicitor of record for the Respondent due to an alleged conflict of interest. For reasons given on May 30, 2023, the Applicant’s motion to remove Ms. Feeley was dismissed.

10Despite the final consent order on parenting, the Applicant sought to reopen the parenting issues. For reasons given orally during the trial, this request was denied.

Analysis

Child and Spousal Support – Retroactive and Ongoing

Income, Imputation of Income and Entitlement

11For the purposes of determining support in this case, both parties are asking the court to impute income to the other party. Both parties are opposed to having income imputed to themselves. Throughout the trial and in the affidavits of both parties, the evidence regarding the issues of income and child and spousal support were all blended together. I found it impossible to analyse these issues separately. Both parties acknowledge that the Respondent has paid the Applicant support, but they do not agree on the amounts and whether it was child and/or spousal support. Both parties claimed different amounts in their taxes. Further, both parties agreed that the Respondent deducted child support from his payments of spousal support to the Applicant. Again, they do not agree on the amounts.

12Aside from the affidavits of Ms. Bragg, and the disclosure described below, there was a limited amount of financial disclosure submitted to the court during the trial. What was provided was extremely confusing and contradictory. The charts provided by the parties were either illegible or simply did not make any sense. Neither of the parties took the time to go through the charts to explain the information contained in them.

13Neither of the parties took me through their income tax returns to explain or make submissions regarding the reasonableness of their deductions and expenses and what should or should not be added back to their income for the purpose of calculating income for support purposes. The court cannot be expected to act as a lawyer for a party or to sift through a pile of documents and “hunt and peck” for the evidence to support the parties’ positions.

14What follows is a summary of the evidence put before the court by both parties along with my findings regarding the issues of income, imputation and entitlement for child and spousal support.

15The Applicant’s position regarding child support, spousal support and income varied in her materials and evidence. The Applicant says she is entitled to retroactive child support based upon an offsetting of the parties’ incomes. The Applicant says that she needs spousal support to compensate her for the unequal economic consequences of the marriage, and to enable her to finish her education so she can contribute to her own support. At one point in the Applicant’s affidavit at paragraph 48, she asks that the court award her monthly spousal support in the amount of $2,469, which is a mid range of spousal support based on the Respondent’s income of $130,000 in his 2021 Income Tax Return and her income in 2021 in the amount of $27,373. Later in that same paragraph, she said that in the alternative, she was seeking a spousal support amount on the high end based on the Respondent’s imputed income that the court may find just based on the evidence. The Applicant also requested that the court make an order imputing the Respondent with an annual income for support purposes of $162,477 for the years 2018, through to present. This income represented the annual expenses claimed in the Respondent’s March 30, 2023 financial statement.¹ The Applicant asked that the court find her income to be $14,727.47 in accordance with her 2022 T4s. The Applicant submitted that the Respondent owed her retroactive child and spousal support in the total amount of $51,944.58 from February 2018 to present.²

16It is the Respondent’s position that the court should make an order imputing the Applicant with an annual income of $32,000 for each of the years 2019, 2020 and 2021. For the year 2022 and onwards, the Respondent requests an order imputing an annual income to the Applicant in the amount of $45,000. He asks that the court find his income for support purposes to be his CRA line 15000 income as set out in his Income Tax Returns which is currently $121,597. The Respondent submits that he has overpaid child and spousal support since 2018 and asks that there be an order that there are no child or spousal support arrears owing to either party.

17Prior to and during the marriage, the Respondent worked in radio, (he continues to work in radio post separation). When he lost his job at a top-rated radio station, he started a “voice-over business” called KBS Productions. The parties dispute how much the Applicant worked and contributed to the success of the business; however, they do agree that the Respondent was “100% of the talent.”³ Over the course of five or six years, the business became quite successful and was the primary income for the family. The Applicant began pursuing her dream of becoming a professional photographer. The Applicant worked part-time for a local photographer as an assistant until she started her own photography business called Tempo Photography.

18The parties created an umbrella corporation called Caughlin-Templeton Corporation which included both businesses (KBS Productions and Tempo Photography). The Applicant was 49% shareholder and the Respondent was 51% shareholder. From the evidence, it seems that the entire purpose of this Corporation was to reduce the parties’ tax obligations. The parties both submitted affidavits from Ms. Sue Bragg dated March 15, 2023⁴ and March 31, 2023⁵. Ms. Bragg was the accountant for both parties jointly for the Caughlin-Templeton Corporation. She stated that she served as the accountant for the Caughlin-Templeton Corporation for at least 10 years. She stated that “the income in the Caughlin -Templeton Corporation has always been mostly Mr. Caughlin’s. Tempo Photography operated at a loss and that loss helped to reduce the corporation’s tax liabilities.” She went on to say that the Respondent “was always aware of the losses and how they benefited him.” Ms. Bragg continues as the accountant for both parties individually for their new sole proprietorships that were created after the date of separation.

19Both parties acknowledge that they had a luxurious lifestyle together during the marriage. They travelled a great deal and the Respondent bought expensive vehicles (Cadillac Escalades) and expensive gifts. The Applicant asserts that the Respondent continues to enjoy the same luxuries after the separation, while she is struggling financially and living below poverty level.⁶ She further asserts that the Respondent misused drugs and that he has depleted family funds to do it.

20The Applicant suspects that the Respondent is hiding income. The Respondent works for a radio station in Turks and Caicos called WIV FM Radio Ltd. He also owns a 3% interest in that company. The Applicant pointed out that in the valuation report of WIV FM Radio Ltd. provided by the Respondent, there is evidence of the Respondent being given “numerous loans, personal expenses and credit cards” that were never recorded in his income, nor on his financial reports as loans.”⁷ She asserts that the Respondent “fails to accurately report his income to the court as a self-employed person. He must declare his WIV Salary/Commission, loans and taxable benefits, and his Bayshore Broadcasting without his KBC Productions business expenses reducing them.”⁸

21The Applicant alleges that the Respondent is receiving voice-over work in Turks and Caicos and that he is also being paid for a Real Estate/Tourist TV business in Turks and Caicos. Her evidence for the allegation about the Real Estate/Tourist TV business was quite thin. It included a screen shot of a text message from the Respondent to his girlfriend bragging about the opportunity. She also attempted to rely on hearsay evidence from Bradley that the Respondent brings home “stacks of cash” from trips, and her own itemized breakdown of the Respondent’s bank statements in 2019.⁹ This is insufficient evidence to support this allegation.

22The Applicant asserts that she dedicated her time in the marriage to building the family business (the Caughlin-Templeton Corporation). She was paid a salary from the business of $60,000 per year and operated a part-time photography studio as a division of that business. She still owns her own photography business Tempo Photography (sole proprietorship).

23At the time of separation, the Applicant was working solely in her photography business. Since separation, the Applicant has attended college to become a social service worker. She indicated that she plans to attend university to complete a social work degree to obtain her B.A. At the time of the trial, the Applicant was a part-time employee working two jobs, one as a taxi dispatcher with Ace Cabs; and one working with people in need at Home Horizon.

24The Applicant asserted that she endured years of emotional, verbal and physical and sexual abuse from the Respondent. She says that at the time of separation, she had no post-secondary education or training other than a part-time non diploma college course in photography. She says that she was completely dependent upon the Respondent for income and support. After the separation, she asserted that she was subjected to emotional, verbal and financial abuse and harassment. She said that since separation, it has been very “hard to make ends meet.” She has no savings and no assets. She asserts that she has no way to provide enough income to pay rent at her minimum wage levels of income. She said that she has been living on OSAP loans and the “fluctuating and unreliable support” that the Respondent has paid. She said that she has resorted to getting food at food banks, loans from family, and suffers “severe financial insecurity.”

25The Applicant stated that she has worked full time all through her life. It is clear from the evidence that she has worked very hard all her life in a few different capacities. She worked full time prior to marriage. During the marriage she assisted in the development and support for the Respondent’s radio and voice-over business KBS Productions and the Caughlin-Templeton Corporation. The level of her involvement and contribution to the Respondent’s business is disputed by the Respondent. However, it is undisputed that she did do the initial bookkeeping for the business.

26In my view, the Applicant’s evidence of her involvement is corroborated by the evidence of Sue Bragg who stated that “Ms. Caughlin handled all the business and accounting matters, as she was the one, whom I dealt with on all accounting issues. There were times I spoke to the bookkeeper, but it was Ms. Caughlin who ran the business and oversaw all the financial matters and the bookkeeper they hired to help.”¹⁰

27During the marriage the Applicant went back to school and got a diploma in photography and opened her own photography studio. After separation, the Applicant went back to school and received a diploma in bookkeeping. She stated that she can do simple income tax returns and that she has done so for some people recently. She gave no evidence as to how much she earned doing this work. She also testified that her photography studio had to close down. However, she admitted that as recently as December 2022, she did approximately four-hundred Christmas Santa photo sessions at approximately $20-25 cash, per person (earning approximately $10,000 cash). She recently completed another diploma program in social services. She currently works part-time as a taxi dispatcher and works 2-3 shifts in a shelter. She stated that she has done all of this while suffering from a debilitating illness called Meniere’s disease, which effects her hearing, balance and causes her nausea. She plans on going back to school again to obtain her B.A. in social work.

28Despite all of this education and experience, the Applicant said that she made minimal income at the beginning of the relationship and after the marriage ended. She was a paid a salary from the family business of $60,000 per year and operated a part time photography studio as a division of the business. She states that at the time of separation she was completely dependant upon the Respondent for income and support. She stated that she earned less than minimum wage every year after the separation. She asserted that after subtracting all support payments that she received, her income from employment and self-employment in 2019 was only $11,722.71; in 2020 was only $308.34; in 2021 was only $21,663.05; and in 2022 was only $14,727.47.

29The Applicant stated in her evidence that the Respondent claimed much higher expenses for his business after separation. She said that the Respondent used his high income in his mortgage application to obtain the mortgage to refinance and purchase her interest in the matrimonial home.

30The Applicant asserts that the Respondent is hiding income and that although she worked throughout the relationship, he has always been the primary income earner in the family. She asserts that the Respondent earned upwards of $300,000 when you add all the perks and “contra” he received. She states that she is in need of spousal support and that the Respondent has the ability to pay it. According to the Applicant, para 98, 99 and 100 of the Respondent’s affidavit show that he has deducted all his business expenses from his salaried pay for spousal support and child support to arrive at the line 15000 income between 2018 and 2022. She asserted that he has also deducted the spousal support that he paid from his income.

31The Applicant’s financial statement dated March 15, 2023 and her Notices of Assessment (NOA) and Reassessment for 2019, 2020 and 2021 are found in Exhibit 4. In the financial statement, the Applicant estimates her 2022 income to be $14,348.76 and her total income from all sources in 2023 is estimated to be $27,129.84. She set out her assets as having a value of $19,582. She further sets out her yearly expenses as totalling $63,187.20. She disclosed debts to OSAP $18,700 and to Arthur and Nancy Coakwell in the amount of $12,000. Her net worth was asserted to be (-$11,118). She stated that her photography business, namely Tempo Photography was carrying on as a sole proprietorship. She stated that she is no longer earning any income from Tempo.

32The Applicant’s NOA’s were attached to her financial statement. In 2019, the Applicant’s total line 15000 income was $53,028. It was reassessed on November 15, 2022 to be $77,344 as a result of her net self employment income (loss) having been disallowed.

33In 2020, the Applicant’s total line 15000 income was $18,950 according to her NOA dated April 22, 2021. It was reassessed on August 30, 2021 to be $28,951 as a result of information her representative gave to the CRA. It was reassessed again on September 7, 2021, but the total income remained the same.

34In 2021, the Applicant’s total line 15000 income was $27,371. The Applicant did not tender her full income tax returns to the court.

35The Respondent requests a finding that all retroactive child and spousal support arrears and overpayments are a “wash.” He asks that the Applicant be imputed an income of $32,000 per year for the years 2019, 2020 and 2021. He further asks that the Applicant’s income for support purposes of the year 2022 onward should be imputed to $45,000 per year and that his income for support purposes be $121,597 per year (his line 15000 in his income tax returns). He asks for an order that he pay the Applicant ongoing spousal support in the amount of $1,477 per month. He says he would waive the Applicant’s child support payment owed to him in the amount of $418 per month (based her being imputed an income of $45,000).

36The Respondent owns three shares in a radio station overseas called WIV FM Radio Ltd. which according to the Respondent, represents 3% of the equity of the business. He also owns his own business called KBC Productions which a sole proprietorship through which he earns money doing “voice over” work for radio/TV. At the time of separation, the Respondent was operating the Caughlin-Templeton Corporation and working solely in his own business and for WIV FM Radio Ltd. The Respondent dissolved the Caughlin-Templeton Corporation after separation. At the time of the trial, the Respondent continued to operate his sole proprietorship KBC Productions and works for WIV FM Radio Ltd. The Respondent owns 3% share of WIV FM Radio Ltd. He is also an employee of a local radio station in Ontario.

37The Respondent asserts that he had “two sources of income” throughout the marriage, which continue to the present time. First, he does radio and television voice-over work, on a free-lance basis. Also, he is paid a salary and 15% sales commissions as the manager of WIV FM Radio Ltd. He carried on business as KBC Productions during the marriage and all of his expenses and revenues were attributed to the Corporation. Now, KBC is run as a sole proprietorship. WIV FM Radio Ltd. paid him an annual salary of $30,000 USD plus sales commissions. He states that he has never had a raise in his salary. The Respondent states that his freelance work was traditionally his most lucrative income source, but that has changed. He said that his “voice is out of style” and there is lots of competition for voice-over talent, which has reduced his sales “significantly.”¹¹

38The Respondent’s financial statement dated March 30, 2023 is marked as Exhibit 7. In the financial statement, the Respondent states that his gross income from all sources for 2022 was $121,598. His total income from all employment and self-employment sources for 2023 is estimated to be $124,713.96. He set out his yearly expenses as being $162,477.24. He set out values for his assets as being $891.909.38. He disclosed debts totalling $704,907.12 (which included the mortgage on his home, a vehicle loan and a credit card). He set out his net worth as being $187,002.26. He disclosed that he was employed by Bayshore Broadcasting (MAX 97.7 FM Radio). He further disclosed that he was self employed carrying on business under the name of KBC Productions.

39The Respondent’s income tax returns and NOA’s and reassessments for 2018, 2019, 2020 and 2021 are all marked as Exhibits 8, 9, 10 and 11 respectively. In 2018, the Respondent’s gross business income was $69,217.65. His total line 150 income was $109,872. It was reassessed on September 3, 2019, but the income remained the same. In this Income Tax Return, he claimed to have paid spousal support in the amount of $13,510.¹²

40Pages 1 and 2 of the Respondent’s 2019 NOA were missing. According to his income tax return for 2019, the Respondent’s gross business income was $186,599.03. His total line 15000 income was $122,589. In this Income Tax Return, he claimed to have paid spousal support in the amount of $54,048.00.¹³

41According to the Respondent’s income tax return for 2020, the Respondent’s gross business income was $149,188.68. His total line 15000 income was $114,122. In this Income Tax Return he claimed to have paid spousal support in the amount of $28,643.00.¹⁴

42According to the Respondent’s income tax return for 2021, the Respondent’s gross business income was $163,175.97. His total line 15000 income was $130,577. In this Income Tax Return he claimed to have paid spousal support in the amount of $11,171.¹⁵ In the Respondent’s affidavit, he claimed to have paid the Applicant $30,540 in child and spousal support (while the child was living with him). He further asserts that he paid the Applicant $24,830 in spousal support however, the Applicant only claimed to receive $5,710 in spousal support that same year.¹⁶

43According to the Respondent’s income tax return for 2022, the Respondent’s gross business income was $126,245.91 and his employment income was $41,883.24. His total line 15000 income was $121,597.52.

44The Respondent claims that he has “over-paid” the Applicant child and spousal support since 2018. The evidence shows that he has paid the Applicant a mixture of support (sometimes he claims the payments to be child support and/or spousal support with deductions for the child support owed to him by the Applicant). He has deducted the spousal support payments at times to account for the child support owed to him by the Applicant, or to “recoup” the tax savings he lost because he was unable to deduct the voluntary spousal support payments he made.¹⁷ At all times, it seems that he used his line 15000 income and imputed an income of $32,000 to the Applicant to calculate the mid-range spousal support amount.

45Aside from the Respondent’s assertion that his income has reduced significantly, he did not provide any evidence to support this. Further, he did not explain the “loans” from WIV FM Radio or his deductions on his Income Tax Returns.

46The Respondent denies the allegations of abuse made against him. He asserts that it is the Applicant who had mental health issues and threatened and manipulated him. He alleged that it was the Applicant who overspent and depleted the family assets. He asserted that the Applicant’s “overspending was always an issue” in their marriage.¹⁸

47The Respondent asked the court to impute income to the Applicant due to her lack of disclosure and hiding cash income. He asserts that the Applicant is still running Tempo as a cash business. He asserts that the Applicant has undeclared cash income from Tempo Photography due to Tempo’s “cash only policy” and Tempo does not accept debit or credit payments. He points out that the Applicant has not disclosed her 2022 Income Tax Return. He pointed out some direct contradictions in the Applicant’s evidence where she said that she had to close Tempo, yet, she was doing Christmas photo shoots in 2022 and also advertising for Easter photos in March of 2023.¹⁹ He asserts that the Applicant is able bodied and has a long and continuous history of gainful full-time employment. He says that the Applicant “has demonstrated ability to earn significant income. She is an award-winning photographer with many loyal customers. She is highly skilled in bookkeeping and accounting. She works several jobs and attends college on a full-time basis.”²⁰

48The Respondent asserts that he has overpaid support and that the Applicant is not entitled to any retroactive spousal support. He bases the majority of his so called “overpayments” on his claims regarding his income. However, as set out above, it was clear to the court that the Respondent did not understand that as a self-employed person, his line 15000 income as set in his Income Tax Returns is different than the income used to calculate child and spousal support. I find that between 2018 and 2022, the Respondent’s line 15000 income is not a fair or accurate reflection of his income for the calculation of child and spousal support. The Respondent deducted the majority of his home-based business expenses from his salaried pay to arrive at the line 15 000 income as set out in his Income Tax Returns and his affidavit.

49Although the Respondent submitted his Income Tax Returns during the trial, he did not take the court through them or give evidence to show or explain the deductions. The Applicant did not cross examine the Respondent on them either. In fact, neither of the parties took the court through their Income Tax Returns (if they were provided).

50During cross examination, the Respondent acknowledged that from December 2020 until December 2022 he deducted $273 per month from every spousal support payment he made to the Applicant (for child support owed to him). Even though this clearly means that the Applicant paid the Respondent child support (without a court order for same), the Respondent would not admit that she had paid him child support. Throughout the cross-examination, I found the Respondent’s answers stubbornly evasive.

51Section 15.2 of the Divorce Act R.S.C., 1985, c. 3 (2nd Supp.) (hereinafter “the Divorce Act”) sets out the terms and conditions for a spousal support order. The court must consider the condition, means, and needs and other circumstances of each spouse including the length of cohabitation, the functions performed by each spouse and any other orders, agreements or arrangements relating to support. Any order for support should meet the objectives of the Divorce Act as set out in s. 15.2(6).

52The support provisions of the Divorce Act are intended to deal with the economic consequences of the marriage, or its breakdown, for both parties. While spouses have an obligation after the marriage breakdown to contribute to their own support in a manner that is commensurate with their abilities, the ultimate goal is to alleviate the economic disadvantages experienced by one spouse and account for the advantages that were conferred on the other spouse during the marriage. The Divorce Act promotes equitable sharing of the economic consequence of the marriage or its breakdown.²¹

53Section 19(1) of the Child Support Guidelines provides a list of the circumstances in which income can be imputed to a party, including in circumstances in which a party chooses to earn less than he or she is capable of earning or refuses work when capable of working,²² a party unreasonably deducts expenses from his or her income,²³ a party fails to reasonably use property to generate income²⁴ or a party has income which is taxed at a lower rate than employment income.²⁵ The factors itemized in s. 19(1) are not exhaustive, and income has been imputed based on other factors such as lifestyle or career choice, earning history and the availability of student loans.²⁶ It is possible for a payor to have different incomes for the purposes of child support and spousal support. In the imputation of income, for example, income may be more readily imputed for child support than for spousal support. Further, in some cases, the division of property, such as stock options, may require an adjustment of income for spousal support that is not required for child support.

54Parents have a joint, ongoing obligation to support their children. Imputing income is one method by which the court gives effect to the obligation of a party to support his/her dependants, and to support him/herself when they are claiming support from another. In order to meet this obligation, the parties must earn what they are capable of earning. If they fail to do so, they will be found to be intentionally under-employed. See: Drygala v. Pauli, 2002 CanLII 41868 (ON CA), [2002] O.J. No. 3731(Ont. CA).

55The person requesting an imputation of income must establish an evidentiary basis upon which this finding can be made. See: Homsi v. Zaya, 2009 ONCA 322, [2009] O.J. No. 1552. (Ont. C.A.). Once a party seeking the imputation of income presents the evidentiary basis suggesting a prima facie case, the onus shifts to the individual seeking to defend the income position they are taking. See: Lo v. Lo, 2011 ONSC 7663; Charron v. Carriere, 2016 ONSC 4719.

56The court will usually draw an adverse inference against a party for his or her failure to comply with their disclosure obligations and impute income. See Smith v. Pellegrini, 2008 CanLII 46927 (ON SC), [2008] O.J. No. 3616, (Ont. S.C.); Maimone v. Maimone, 2009 CanLII 25981 (ON SC), [2009] O.J. No. 2140, (Ont. S.C.).

57An individual must make full and complete financial disclosure to ensure that the information required to make a decision on the issue is before the court. Charron v. Carriere, 2016 ONSC 4719.

58Further, a person’s lifestyle can provide the basis for imputing income. See: Aitken v. Aitken [2003] O.J. No. 2780 (SCJ); Jonas v. Jonas, [2002] O.J. No. 2117 (SCJ); Price v. Reid, 2013 ONCJ 373.

59The court may consider pre-tax corporate income, together with line 15000 income over the previous 3 years to determine income if the court believes the line 15000 income of the payor does not adequately reflect income. This approach is also consistent with the fundamental object of the Guidelines, which is to ensure fairness to both spouses, and to their children, in determining what amount of money is in fact reasonably available for the payment of support. See Mason v. Mason, 2016 ONCA 725. The court finds that this approach is equally applicable when dealing with spousal support.

60On at least two occasions, the Respondent offered, and the Applicant accepted spousal support in the amount of $3438 per month (the Graham Order in September 2018 and the Separation Agreement in July 2019). Then, on December 19, 2019, the child support and spousal support were reduced (on consent).

61In my view, based upon the evidence of both parties and the evidence of Ms. Bragg, there is a prima facie case for a compensatory spousal support entitlement based on the roles assumed during the marriage, the length of the marriage, and the incomes of the parties. It is clear to the court that the Respondent was the primary income earner for the family and that the Applicant was dependent upon him financially. Further, although the Applicant works, she has been unable to support herself after separation. Therefore, it is clear to the court that the Applicant’s entitlement for spousal support is both compensatory and mean/needs.

62Adverse inferences may be made by the court in circumstances when a party has not provided adequate disclosure. When the court is determining “income” for support purposes, the presumption is to first look at the payor’s income as it appears on his or her line 15000 of their income tax return. The onus is on the person requesting an imputation of income to establish an evidentiary basis for such a finding.²⁷ The Applicant has asked the court to impute income to the Respondent and order that he pay retroactive child and spousal support based on that imputed income of either $130,000 or $162,477. The court cannot impute an income to the Respondent where there are no reasonable facts or evidence to support it.

63In my view, the Applicant failed to provide sufficient evidence to the court to support making a finding that the Respondent’s income is $162,477. Granted, there is some inconsistency in the Respondent’s lifestyle and income (i.e. his expenses exceed his income). His financial statement did not show that he was incurring debts to make up for the differences. At the same time, the Respondent has failed to provide sufficient evidence to the court regarding the alleged income he wishes to impute to the Applicant. There is also inconsistency in the Applicant’s lifestyle and income (i.e. her expenses exceed her income) however, she has incurred debts (student loans and personal loans) to make up for the differences.

64On numerous occasions, the Court of Appeal has reiterated the significance of non-disclosure in family court and referred to it as the “cancer” of family law.²⁸ The consequences of failing to disclose vary. I found there were serious credibility issues with both the Applicant’s and the Respondent’s evidence and their assertions due to the lack of disclosure.²⁹

65Despite this, I find that the Applicant’s evidence was somewhat more credible than the Respondent. Her submissions were corroborated by Ms. Bragg. The Applicant also took the time to go through the Respondent’s bank statements to show that the Respondent had a higher level of income than he claimed. I find her request to impute an income of $130,000 to the Respondent is reasonable. However, she did not take a reasonable position when it came to valuing her photography business income. She unreasonably requested that an income of less than minimum wage be imputed to her and she did not provide adequate disclosure of her cash income from photography.

66I am not satisfied with the evidence before the Court regarding the Applicant’s ability to earn an income. I do not accept that she is disabled or unable to work as suggested by the Applicant, nor that she is able to work and earn a significant income as suggested by the Respondent. The Applicant has an obligation to work to capacity and absent evidence to the contrary, the Court will impute a minimum wage full-time income to the Applicant. The court notes that this is the income the Respondent sought to impute to the Applicant.

67The Applicant has been attending school and working part-time and receiving inconsistent amounts of support. She intends on attending further education to better her prospects for income and employment and be more self-sufficient. I find it appropriate to impute an income of $32,000 to her for the years 2021, 2022, 2023 and onwards.

68I am further not satisfied with the evidence before the court regarding the Respondent’s income. I do not accept that his line 15000 income in his Income Tax Returns is an accurate reflection of his income for support purposes. At the same time, using his expenses set out in his financial statement to impute income of $162,477 is not reliable either. Both parties financial statements show that their living expenses exceed their incomes.

69In reviewing the Respondent’s Income Tax Returns and his financial statement, I find it appropriate to grant the Applicant’s request to impute an income of $130,000 to the Respondent. This shall be used for 2021, 2022, 2023 and onwards. The court notes that this is the income the Applicant sought to impute to the Respondent.

Retroactive and Ongoing Child and Spousal Support

70The parties dispute the retroactive and ongoing child support for Bradley. It is very difficult, if not impossible, for the court to accurately piece together all that has occurred between these parties since they separated in February 2018. There are over five years of allegations, multiple court appearances, negotiations, temporary orders and partial final orders to sift through. What follows is my best attempt of summarizing the litigation history and some of the undisputed facts that are relevant to the issues of support.

71On February 6, 2018 the Application was issued along with an urgent ex parte motion. Vallee J. made an Ex Parte Order on February 6, 2018. On February 15, 2018, Sutherland J. varied the Ex Parte Order of Justice Vallee. He terminated the restraining order and made a “nesting” order and other various orders regarding parenting and maintenance of the “status quo” financially (the Sutherland Order). The Application was amended on March 8, 2018.

72On September 19, 2018, Graham J. made a consent order (without prejudice) for the Respondent to pay the Applicant child support in the amount of $1066 per month and spousal support in the amount of $3,438 per month (the Graham Order). He further made other orders regarding a process for division of the personal property and contents of the home. Neither parties’ incomes are mentioned in the Graham J. endorsement of September 19, 2018, or in the Graham Order.

73On January 16, 2019 the parties entered into minutes of settlement with the assistance of counsel regarding disclosure. On July 16, 2019 the parties entered into a partial Separation Agreement regarding temporary child and spousal support and the payment of debts, property division and the transfer of the Applicant’s interest in the matrimonial home to the Respondent (the Separation Agreement). The Separation Agreement repeated and reconfirmed the same amounts to be paid for child and spousal support as set out in the Graham Order. Again, neither parties incomes were mentioned in the Separation Agreement.

74On August 28, 2019 the parties agreed to a final order for shared “week about” parenting time (the “Eberhard Order”). The child and spousal support were reduced on consent (without prejudice) in the Order of McDermot J. dated December 19, 2019. The child support was reduced to $571 per month (based upon offsetting the Applicant’s income of $45,000 and the Respondent’s income of $109,978). The spousal support was reduced to $2,493 per month and the payments ended on June 17, 2020 when the amount was to be reviewed.

75The best evidence available to the court supports a finding that Bradley was in the shared equal care of each party until November 2020, when they both acknowledge that Bradley went to live with the Respondent. Both parties made serious and terrible allegations about the other regarding how Bradley had become involved in the adult and legal issues after separation. As the parenting issues have been resolved and Bradley is now sixteen years old, I am not going to detail all the horrible things both parties said about the other. There is simply no need or relevance. The children’s aid society and the police were all involved at different times. Charges were laid and eventually withdrawn. Suffice it to say, I have no doubt that the parenting issues and high level of conflict have caused both parties and the child significant heartbreak and emotional harm. Although there remains a dispute about how long Bradley followed the 50/50 parenting schedule after separation, both parties agree that in or around November 2020, Bradley stopped residing with both parties equally. Therefore, based on that undisputed fact, I find that on or around November 13, 2020, Bradley began to reside primarily with the Respondent. In my view, it is clear to the court that Bradley was caught in the middle of his parents’ conflict and remained so for years after the separation.

76The McDermot Order does not mention child tax benefits (CTB’s), however, the Applicant claims that she accepted the reduced spousal support amount set out in the McDermot Order because the Respondent agreed that the Applicant would still receive 100% of the CTB’s. The Respondent denies this. To be clear, this court has no authority to order the Applicant receive 100% of CTB’s or to change Revenue Canada’s rules regarding retroactive or ongoing entitlement to CTB’s. All that the court can do is make a finding of fact that the parties were sharing time with Bradley during this time period, (between February 15, 2018 and November 13, 2020). I note however, that both the Graham Order and the McDermot Order regarding child support and spousal support were made on a “without prejudice” basis. Therefore, the child and spousal support are subject to retroactive adjustment by this Court subject to the verification of the parties’ incomes (and/or imputation of incomes).

77The Sutherland Order granted each of the parties possession of the matrimonial home with the child for a specified schedule to enable them to “nest” and have shared time with the child in the matrimonial home. It further ordered the Respondent to “pay the reasonable cost of either an apartment or hotel room and food for the Applicant Mother” when the Respondent was in possession of the matrimonial home. The Order specified that the matrimonial home expenses were to “continue to be paid as usual – status quo on payment of living expenses to continue.” The Applicant asserts that the Respondent didn’t comply with the Sutherland Order. She said that the Respondent did not pay all of the expenses for the matrimonial home or the reasonable costs of a private apartment/hotel/Airbnb and/or food for the Applicant. The Applicant asserts that the Respondent broke her personal items in the matrimonial home and left notes for her in personal drawers calling her names. She further asserts that she felt unsafe, harassed and abused by the Respondent as she heard from Bradley that the Respondent threatened to kill the Applicant by contaminating objects and/or areas of the house with things that the Applicant was highly allergic to.

78The Respondent stopped paying the Applicant the $2,493 spousal support in June 2020 (in accordance with the McDermot Order). However, he continued paying the Applicant some voluntary support, (the exact amounts are in dispute - and it is unclear whether it was treated or claimed as child or spousal support). Both parties agree that the Respondent deducted amounts from his voluntary support payments (sometimes for taxes, health benefits or child support).

79The Eberhard Order confirmed that Bradley was residing primarily with the Respondent as of November 2020. As of March 2023, the Applicant voluntarily terminated child support being paid to her through the Family Responsibility Office.

80Based upon my finding above that the Applicant’s income is imputed to be $32,000 and the Respondent’s income is imputed to be $130,000. I have found that the parties shared parenting time for Bradley from separation until November 2020. Therefore, I will use those incomes to calculate retroactive child support payable by the Applicant and retroactive high end spousal support payable by the Respondent from July 2020 onwards.

81In my view, the Respondent is not opposed to the Applicant’s entitlement to spousal support. What he is opposed to is the amount. Based upon the conflicting evidence regarding the nesting agreement and the consent orders and payments from September 2018 until November 2020, I am not going to make a finding of retroactive support arrears or overpayments for the period from separation in February 2018 to the month of June 2020.

82Based on the conflicting evidence of income, payments made and the residence of the child and the consent orders, I find it fair to find there are no arrears, retroactive underpayments or overpayments of child and/or spousal support owed for the years 2018, 2019, and the first six months of 2020. That period of time shall be a “wash” as requested by the Respondent.

83According to the McDermot Order, spousal support was to be “reviewed” in June 2020. As I have already discussed earlier, I have found that the Applicant is entitled to spousal support. I am satisfied with the Applicant’s efforts to contribute to her own support, however, I recognize that she may never become completely self-supporting. The Respondent on the other hand is still enjoying the same or similar work and lifestyle as he did during the marriage. He is doing work that may not necessarily require retirement any time soon. As will be seen below, the equalization payment and post-separation adjustments will not make a significant difference to the Applicant’s financial situation or reduce her need for support. In my view, given the Applicant’s health issues and her dependence upon the Respondent for support as the primary income earner, the Applicant is entitled to indefinite spousal support in the high range of the SSAG’s. I find that the Respondent should have commenced paying the Applicant in July 2020 using the high end spousal support calculation based upon an imputed income of $32,000 to the Applicant and $130,000 to the Respondent. The amount that should have been paid by the Respondent to the Applicant is $2476 and the child support payable by the Applicant to the Respondent should have been $273 per month – making a net spousal support payment of $2203 per month from July 2020 to present. I find that the Respondent should have paid the Applicant spousal support between July 2020 and December 2023, (42 months x $2203 which equals $92,526.

84According to the Respondent’s evidence, he says he paid the Applicant voluntary spousal support in 2020, 2021, 2022 and 2023. The evidence of what was paid and whether it was claimed as spousal support is contradictory. The Applicant and Respondent’s assertions and claims in their Income Tax Returns are all different. The Respondent says he paid the amount of $13,395 from July 2020 to December 2020.³⁰ According to the Respondent’s charts, he paid the Applicant $17,645 in combined spousal support and child support in 2021. However, in his affidavit, he claims to have paid the Applicant $30,540 in child and spousal support (while Bradley was living primarily with him) but the Applicant only claimed $5,710 in spousal support received in 2021. Additionally, the Respondent’s chart indicates that he paid the Applicant $15,371 in combined spousal support and child support in 2022. Plus, he says he made 3 payments of $571 in 2023 totalling $1713. All of these payments add up to $48,124 payments.

85The Respondent indicated to the court that he already reduced his payments by approximately $4000 to reflect the tax savings he missed out on in 2020 by way of his voluntary payments.³¹ He further deducted child support from his spousal support payments. For this reason, I find there is no retroactive child support owed by the Applicant to Respondent.

86I found the Applicant’s charts setting out the payments were either illegible, or confusing. She did not provide me with copies of her income tax returns to show how much she claimed for child and/or spousal support payments received. In the absence of better evidence, I relied upon the Respondent’s evidence of payments.

87Therefore, I find that the Respondent has paid the Applicant spousal support from July 2020 until present in the amount of $48,124. When you subtract the amount of $48,124 from the amount of spousal support owed $92,526, the retroactive spousal support that was not paid equals $44,402. Therefore, I find the Respondent owes the Applicant retroactive arrears of spousal support in the amount of $44,402 representing the period from July 2020 to December 2023.

88Retroactive arrears of spousal support are hereby set at a total of $44,402 which shall be paid to the Applicant by the Respondent at a rate of $600.00 per month until fully paid. This amount shall be added to $2203 monthly spousal support payment and shall be taxable income to the Applicant and a deduction for the Respondent.

89Based upon all of the above, commencing January 1, 2024, the Applicant shall pay the Respondent $273 per month child support for Bradley and the Respondent shall pay the Applicant high end spousal support in the amount of $2,476. As a result of the offset of child and spousal support, the Respondent shall deduct the $273 per month from his spousal support payment and just pay the Applicant the sum of $2203.00 until the child is no longer a dependant. In addition, commencing January 1, 2024, the Respondent shall pay $2203 per month spousal support to the Applicant, plus $600.00 for arrears until fully paid totalling $2803.00 per month. When Bradley is no longer a dependent child the Respondent shall no longer deduct $273 per month from the spousal support payment. The spousal support payment shall go up to $2476 when Bradley is no longer a dependent, (plus the $600 per month in arrears until they are totally paid).

Equalization and Post-Separation Adjustments

90In accordance with their Partial Separation Agreement dated July 16, 2019, the parties have settled and/or equalized all of their property (except with respect to their business interests in the Caughlin-Templeton Corporation and WIV FM Radio Ltd.).

91The Caughlin-Templeton Corporation was owned by both parties with the Applicant owning 49% and the Respondent owning 51%. The Corporation was dissolved after the parties separated and two new “sole proprietorships” were created. The Applicant’s new company is Tempo Photography and the Respondent’s new company is KBC Productions.

92The Respondent owns shares in a radio station WIV FM Radio Ltd. in Turks and Caicos. On January 16, 2019, the parties agreed to temporary Minutes of Settlement. Both the Applicant and Respondent were represented by counsel in the negotiation and execution of the Minutes of Settlement. Pursuant to para. 2 (iii) of these Minutes, the Respondent was required to obtain a valuation of his interest in WIV FM Radio Ltd. and the Applicant was required to obtain a valuation of her photography equipment used at Tempo Photography.

93On August 13, 2020, the Respondent obtained a valuation of his interest in WIV FM by Mr. Drexwell Seymour, CPA, MBA, a partner in HLB Certified Public Accountants of Turks and Caicos. Mr. Seymour valued the Respondent’s 3% ownership interest in WIV FM Radio Ltd. at $12,123.42 USD, which he says is $15,927.81 in Canadian dollars. The Respondent has claimed that value in his financial statement.

94On August 18, 2019 the Applicant was ordered to “provide a complete list of all photography equipment owned on the date of separation.”³² The Applicant has never disclosed whether an appraisal of the photography equipment was ever completed. The Applicant has not provided the Respondent with a list of photography equipment. Instead, the Applicant has taken the position that it is unreasonable for the Respondent to request a valuation of the photography equipment. In her correspondence to the Respondent on March 17, 2023, the Applicant stated the following:

I will not be able to obtain a valuation of the equipment of Tempo Photography for the same reasons I had disclosed in Justice Eberhard’s court. You had complete access to the values of these items as they were assets of the corporation you controlled and were documents in the final dispersion of corporate assets when you chose to dissolve the corporation. It is unreasonable to require me to pay over $3,000 to provide you values for equipment your corporation purchased. All depreciated values are noted in the corporate books, and the value of the dispersion of same is noted in the appendix attached to Ms. Bragg’s affidavit.³³

95According to Ms. Bragg, upon the Respondent dissolving the corporation, she distributed the photography assets to the Applicant’s new company, Tempo Photography, and the KBC Productions assets to the Respondent’s new company KBC Productions. Currently, the Applicant still owns Tempo Photography and the Respondent still owns KBC Productions.

96According to Ms. Bragg, “the only tangible assets of the corporation, over its life, were the listed business equipment and Mr. Caughlin’s 2012 Cadillac.”³⁴ Some of the equipment listed as assets of the corporation belonged to Tempo Photography and some equipment belonged to KBC Productions. Neither of the parties provided valuations or disclosure to help prove the value of the corporation or of their equipment. Neither of the parties carry any inventory of any value.

97Ms. Bragg indicated that the equipment (such as a camera and flash and photo printer) that belonged to Tempo Photography “does not hold much value.”³⁵ She described the equipment as “old” and “dated.” There were other pieces of equipment that were not readily identified as belonging to KBC Productions or Tempo Photography such as “lap tops, TV, iPads and computers). She went on to say that the Respondent “received more assets out of the corporation than Ms. Caughlin, as he took the company car and all of the cash assets and accounts receivable. He also had more in shareholder loans (personal expenses paid from the corporation) in the final 18 months than Mr. Caughlin did. Ms. Caughlin had no shareholder loans at the date of separation, she had shareholder contributions that increased with the personal payment of the business debts.”³⁶

98However, in her second affidavit dated March 31, 2023, Ms. Bragg stated the following at paragraphs 9, 10 and 11:

9. Mr. Caughlin advises me that the 2012 Cadillac Escalade that was listed as a corporate asset, was included in computation of the division of the parties Net Family Property that underpinned the equalization payment under the Partial Separation Agreement.

10. Mr. Caughlin advises me that the Applicant’s interest in the contents of Tempo was not included as an asset for her in the calculations underlying the division of the parties Net Family Property.

11. If the information in paragraphs 9, and 10 above is true, then I am no longer in a position to say that “Mr. Caughlin received more assets out of the corporation than Ms. Caughlin”, as I did in paragraph nine of my affidavit sworn March 15, 2023 because I do not understand how the division of Net Family Property could list corporate assets, such as the 2012 Cadillac, in addition to any value that may have been attached to the shares of Caughlin-Templeton Corporation.

99According to the Partial Separation Agreement, the Respondent paid the Applicant an equalization payment in the amount of $79,000. Paragraph 6.3 of the Partial Separation Agreement states that,

This payment is a negotiated amount that is inclusive of any equalization payment and/or post-separation adjustments owing from one party to the other, including any adjustments owing for interest and penalties accrued on debts and liabilities since the date of separation and represents a full and final resolution of claims under Part 1 of the Family Law Act arising from the breakdown of the parties’ marriage, with the exception of the parties’ interests in The Caughlin-Templeton Corporation and WIV FM Radio Ltd., which the parties intend to equalize separately.

100Neither of the parties provided the court with the Net Family Property calculation that was used to calculate the equalization payment in the Partial Separation Agreement. Nowhere in the Partial Separation Agreement was there a mention of the 2012 Cadillac Escalade or its value being included in the equalization payment. Nowhere in the Partial Separation Agreement was there a mention of the value of the Caughlin-Templeton Corporation, Tempo Photography equipment or KBC Productions equipment or its value being included in the equalization payment. The Partial Separation Agreement specified that the Applicant was to transfer her interest in the matrimonial home to the Respondent in return for the Respondent paying her $79,000 and paying out and discharging numerous debts. The Agreement provided a list of debts that the Respondent was to pay and/or discharge. These included many jointly held credit cards, loans, and a line of credit. Important to note, the list of debts to be paid by the Respondent also included:

Para. 6.4 (l) The Caughlin-Templeton Corporation’s corporate debts, including:

(i) Corporate HST owing;

(ii) Corporate taxes owing;

(iii) Payroll taxes owing;

(iv) Accounting fees owing; and

(v) Legal fees owing.

101The $79,000 equalization payment was made and the matrimonial home was transferred. The court can only assume that all the listed debts were paid and/or discharged. The mortgage commitment and trust ledger provided by the Respondent for the refinance does indicate that a significant number of debts were paid.

102Additionally, the Partial Separation Agreement states that the parties shall be “solely responsible for their own personal debts and liabilities.” The Agreement goes on to list several credit cards (5) solely in the Applicant’s name, and (1) credit card solely in the Respondent’s name, in addition to the Applicant’s and Respondent’s separate CRA tax liability.

103The Respondent requested an order that there shall be no further claims or accounting for any other property, or any business’s inclusive of but not limited to Tempo Photography, KBS Productions, WIV FM Radio, or the Caughlin-Tempo Corporation. Basically, he requests there be no further equalization or post-separation adjustments at all.

104In my view, there is no evidence that the Partial Separation Agreement contemplated equalization payment and/or calculation that included corporate assets, such as the 2012 Cadillac, in addition to any value that may have been attached to the shares of Caughlin-Templeton Corporation in the division of Net Family Property. In fact, the Agreement clearly states the opposite, that the Caughlin-Templeton Corporation and the shares in WIV FM Radio Ltd. would be equalized separately. Therefore, I cannot grant the Respondent’s request that there be no further equalization or post-separation adjustments.

105The Applicant asserted that she is entitled to an “unequal division of our corporate assets as well as credit for all corporate debts that I had personally.” According to the Applicant, the Respondent owes her an equalization payment in relation to WIV FM Radio shares, as well as equalization and “post-separation adjustments” in relation to the Caughlin-Templeton Corporation. These include: $21,445.14 which she asserts represents the Respondent’s 51% share towards the Caughlin-Templeton Corporation debt, (which the Applicant claims was paid solely by the Applicant after separation); $9,803.07 which represents the Applicant’s 49% share in the corporate receivables that the Applicant claims the Respondent diverted from the corporation; $7,962.60 which represents the Respondent’s 51% share in the shareholder loans he withdrew from the Corporation post-separation. Also, in lieu of a share of ownership in the Respondent’s shares in WIV FM Radio Ltd., the Applicant asks that the Respondent pay her $20,000 for the buyout of her interest in the shares. All of this totals a payment of $59,210.81 from the Respondent to the Applicant as full and final settlement of equalization and post-separation adjustments.

106Ms. Bragg confirmed in her affidavit dated March 15, 2023 that two credit cards in Ms. Caughlin’s sole name held “balances that were almost entirely business expenses” and Mr. Caughlin also had “a personal credit card that had a large portion of business expenses.”³⁷ She went on to say that when both parties “paid these credit cards on their own (Ms. Caughlin’s were via a consumer proposal and Mr. Caughlin’s upon refinancing his home), they were logged as shareholder contributions by each and should have been repaid to the shareholders on dissolution of the corporation. These unpaid shareholder contributions were used by each party as losses in subsequent years, but Ms. Caughlin was left with the majority of the debt in her name.”³⁸

107During the Applicant’s cross examination of the Respondent, she asked him questions regarding the valuation of his shares in WIV FM Radio Ltd. She also asked him questions regarding the business income and finances for KBS Productions, Tempo Photography and the Caughlin-Templeton Corporation. The Respondent acknowledged that the Applicant did do the personal and business bookkeeping. He denied or minimized any insinuation that the Applicant helped “build” the business or that she was in any way “responsible” for his “success.” He simply said repeatedly that “finances were not my forte.” He agreed that the Caughlin-Templeton Corporation was created for “tax purposes.” It was clear to the court that the Respondent did not understand that as a self-employed person, his line 15000 income as set out in his Income Tax Returns is different than the income used to calculate child and spousal support.

108I find during the Respondent’s evidence and while he was being cross-examined, he tried to minimize the Applicants contribution and/or value in the marriage and involvement in the businesses. I found his evidence was either evasive or contradicting. He seemed to blame the Applicant for his own lack of understanding regarding the finances, and for the debts, or claimed he was ignorant of the finances. However, Ms. Bragg confirmed that the valuation of all the corporate assets has “always been available to both Mr. Caughlin (and Ms. Caughlin) as majority owner of the corporation. He was also given a final distribution breakdown. Mr. Caughlin has always had access to the corporate book though QuickBooks, as has Ms. Caughlin, my accounting firm, and their own bookkeeper.”³⁹ She further confirmed that the Respondent was “aware of all credit cards and had access to the books to always see their charges. Any claims he makes that he knew nothing about the credit cards would be false. They are all documented in the corporate books.”⁴⁰

109The Respondent provided the valuation which speaks to the issue of the value of his shares in the WIV FM Radio Ltd. As pointed out by the Applicant, and acknowledged by the Respondent during cross-examination, the valuation provided by the Respondent contains some errors and omissions. Unfortunately, the Applicant did not provide a valuation of her own, nor did she provide a critique of the Respondent’s valuation.

110The Applicant and the Respondent assert competing values for the Respondent’s 3% ownership stake of a radio station. The Applicant, while arguing the shares are worth more than the Respondent has submitted, did not submit a critique, or offer her own valuation. She did not provide any evidentiary basis for her request for a payment of $20,000 to equalize these shares.

111Cases where there is insufficient disclosure and/or where one party has misled the court often cause problems for assigning value to assets, often leading the court to make guesses based on the limited information available. A litigant’s failure to fulfill their family law disclosure obligations can be relevant to the court’s equalization decision. Courts have drawn adverse inferences from a party’s failure to provide disclosure and/ or their efforts to mislead the court. These inferences can lead to the court preferring the evidence of another party and using that evidence to assign value. Nevertheless, even where only limited evidence of value is available, any value chosen by the court must have a basis in evidence before it, even if ‘rough justice’ is required to choose the final number.

112Alternatively, the court can eschew the process of valuing property by using its statutory or equitable jurisdiction to order property be sold, partitioned, vested, or held in trust to fulfill the necessary equalization. Where an asset has no value or an opaque value, the court could order it held in trust, to be sold or partitioned between the parties. In other circumstances, where the process of valuation for one asset has been frustrated by a party, the court may be able to achieve a fair equalization by assigning 100% of that frustrated item to the difficult party, and 100% of one or more other properties to the opposing party.

113I agree that the Respondent’s valuation of the 3% ownership interest in WIV FM Radio contains discrepancies. However, it is the only evidence I have regarding its value. At the same time, I do not have a satisfactory evidentiary basis to make a finding regarding the value of the 3% ownership interest in favour of the Applicant’s purported value. The 3% interest clearly has a value, and it would be prejudicial to the Applicant not to equalize this asset.

114I am not satisfied with the evidence of the Applicant to assign a higher value to the Respondent’s 3% shares in WIV FM Radio, than that of the valuation provided by the Respondent. I find that the value of the Respondent’s shares in WIV FM Radio Ltd. is $15,927 and the Applicant is entitled to 50% being $7,963.50.

115In the midst of the trial, the Respondent sought to present an email from a lawyer who would explain the value of his shares in the WIV FM Radio Ltd. This email was objected to by the Applicant. I did not allow the email to be reviewed or entered into evidence. I found it highly suspicious that after five years of litigation, on the eve of trial, the Respondent suddenly received an email that he said would finally explain the value of the radio station shares. There was no way to verify the validity or authenticity of the information contained in the email. I found that would amount to a significant prejudice to the Applicant to allow the Respondent to ambush the Applicant by submitting evidence so late in the day, when she would have no opportunity to respond or cross-examine the author.

116I am further not satisfied with the evidence regarding the Applicant’s claim for the corporate debts she claimed to have paid through her personal credit cards. The Partial Separation Agreement indicated that both parties were responsible for their personal credit cards. Both parties may have had some business expenses on their credit cards. However, they did not include any clause in the Partial Separation Agreement separating out a portion that would be paid by the Respondent solely (as part of the corporate debts that the Respondent was supposed to pay pursuant to para. 6.2 (i) in the Partial Separation Agreement). Based on the evidence before me, I cannot distinguish between the personal credit cards with business expenses or personal expenses. Therefore, I am not granting the Applicant’s request that the Respondent pay her $21,445.14 which represents the Respondent’s 51% share towards the Caughlin-Templeton Corporation debt, (which the Applicant claims was paid solely by the Applicant after separation).

117I am not satisfied with the evidence of the Respondent that Caughlin-Templeton Corporation or its assets were equalized in the Partial Separation Agreement. I find the Respondent took very unreasonable positions in response to requests for disclosure, especially regarding the equalization of Caughlin-Templeton Corporation and the post-separation adjustments. I found that the Respondent’s evidence-in-chief and his answers during cross-examination about disclosure were evasive and/or non-responsive. Even when faced with proof of the discrepancies and/or inaccuracies in the evidence, his explanations were unreasonable and/or unhelpful. I found that the Respondent exhibited an air of self-importance, like he was the “talent” and therefore, he should not be expected to provide explanations or disclosure.

118I found the evidence of the Applicant more credible than the Respondent regarding the disbursement of the assets, shareholder loans and financials as set out in the balance sheets of the Corporation and attached as Exhibit “A” in Sue Bragg’s affidavit dated March 15, 2023.⁴¹ As a result, I find that any doubts about the Respondent’s evidence resulting from the inadequacy of his disclosure had to be resolved in the Applicant’s favour.⁴² For these reasons, I accept the Applicant’s evidence regarding the post-separation adjustments for the receivables and shareholder loans. I find that the Respondent owes the Applicant 49% of the Caughlin-Templeton Corporation receivables in the amount of $9,803.07 and payment of the Respondent’s 51% share in the shareholder loans that he withdrew from the Corporation post separation in the amount of $7,962.60. Therefore, based on all of the above, I find that the Respondent owes the Applicant a total of $25,729.17, (which is $7,963.50 + $9,803.07 + $7,962.60) as full and final settlement of the parties’ property issues including equalization and post-separation adjustments for the Caughlin-Templeton Corporation and WIV FM Radio Ltd.

119Even though the “equipment” for both the parties businesses has not been valued, I am satisfied with the evidence to find that the sole proprietorships that are now owned personally by the parties along with their equipment are of relatively equal value, and therefore, they are a “wash”. KBS Productions and Tempo Photography are both sole proprietorships and their primary value is the “talent” i.e. the Respondent is the talent behind KBS Productions, the Applicant is the talent behind Tempo Photography. I was given no evidence that either of these businesses have any value that can be divided.

120For all the of the above reasons, I find the Applicant is entitled to an equalization and post-separation adjustments payment of $25,729.17.

Order

121For the reasons set out above, Final Order to go:

1. On or by 30 days from the date of this Order, the Respondent shall pay the Applicant equalization and post-separation adjustments payment totalling $25,729.17 based upon the following:

(a) The Respondent shall pay the Applicant 50% of his 3% interest in WIV FM Radio Ltd. in the amount of $7,963.50.

(b) The Respondent shall pay the Applicant her 49% share in the corporate receivables in the amount of $9,803.07 ;

(c) The Respondent shall pay the Applicant a total of $7,962.60, which is the Respondent’s 51% share in the shareholder loans he withdrew from the corporation post-separation.

2. After the above payments have been made in full, there shall be no further claims or accounting of any other property or business’s inclusive of, but not limited to Tempo Photography, KBC Productions, WIV FM Radio, or the Caughlin-Templeton Corporation. The Respondent shall have no further interest in Tempo Photography and the Applicant shall have no further interest in WVIF Radio (the Respondent’s shares) or KBC Productions. The payment of $25,729.17 in post-separation adjustments and equalization represents a full and final resolution of claims under Part 1 of the Family Law Act arising from the breakdown of the parties marriage.

3. The Applicant’s annual income shall be imputed to be $32,000 and the Respondent’s annual income shall be imputed to be $130,000.

4. Commencing January 1, 2024 and on each first of the month thereafter, the Applicant shall pay the Respondent $273 per month child support for the child Bradley Albert Graham Caughlin, born August 12, 2006.

5. The Respondent may claim the Canada Child Benefit, the refundable child’s GST/HST credits, the Ontario Child Benefit, commencing December 1, 2020.

6. Child support shall be terminated for the child, Bradley Albert Graham Caughlin, born August 12, 2006, when:

a. Bradley ceases to be a “child” as defined in the Divorce Act;

b. Bradley no longer lives with the Respondent Father 40% of the time. This includes Bradley living away from home or school, summer employment or vacation.

c. Bradley turns 18, unless Bradley is unable to become self-supporting due to illness, disability, education or other cause;

d. Bradley becomes self-supporting;

e. Bradley obtains one post-secondary degree or diploma;

f. Bradley marries;

g. Bradley dies; or

h. A party dies.

7. The parties shall adjust the Table amount of child support paid each calendar year based on the parties’ actual income for the calendar year as follows:

a. On or before June 1st of each year, commencing in the year 2025, the parties shall exchange income information (such as T4s, Income Tax Returns, and Notice of Assessment) of the prior calendar year.

b. If Bradley resides less than 40% of the time with the Respondent Father, the parties shall adjust the child support within 30 days of the change in schedule. The Respondent Father is required to pay the Applicant Mother child support in accordance with his line 15000 income of the previous year.

c. If the parties do not agree with the child support adjustment, they shall retain counsel to calculate the new child support amount.

8. The parties shall share the child’s section 7 special and extraordinary expenses in accordance with the Child Support Guidelines.

a. The Respondent Father’s proportionate share of section 7 expenses is 80% and the Applicant/Mother’s proportionate share of section 7 expenses is 20%.

b. The parties shall consent in writing prior to incurring such expenses. The parties shall not unreasonably withhold their consent.

c. The parties shall pay their proportionate share of the child’s section 7 special and extraordinary expenses within 5 days of receiving an original invoice or receipt of the after-tax expense from the other party.

d. Upon Bradley starting post-secondary education, Bradley shall apply for bursaries, scholarships, OSAP and or any personal loans prior to the parties sharing the remainder post-secondary education expenses. The parties shall only pay towards the remainder of Bradley post-secondary education expenses in accordance with the proportionate share in accordance with their income at the time.

9. Commencing January 1, 2024 and on each first of the month thereafter, the Respondent shall pay the Applicant high end spousal support in the amount of $2,476.

10. As a result of the offset of child and spousal support, the Respondent shall deduct the $273 per month from his spousal support payment and just pay the Applicant the sum of $2203.00 until the child is no longer a dependant.

11. Arrears of retroactive spousal support owed by the Respondent to the Applicant are set in the amount of $$44,402. These arrears shall be paid by the Respondent to the Applicant at a rate of $600 per month commencing January 1, 2024 until fully paid. To be clear, commencing January 1, 2024, the Respondent shall pay $2203 per month spousal support to the Applicant, plus $600.00 for arrears totalling $2803.00 per month. When Bradley is no longer a dependent child the Respondent shall no longer deduct $273 per month from the spousal support payment. The spousal support payment shall go up to $2476 when Bradley is no longer a dependent, plus the $600 per month in arrears until the arrears are totally paid.

12. After the above amounts are paid, there shall be no further claims concerning retroactive underpayments and/or overpayments of child and spousal support.

13. SDO to Issue.

14. The Respondent Father shall maintain medical, extended health and dental insurance coverage for the Applicant Mother and Bradley as long as it is available to him from his employment. The Respondent Father shall make available, at all times, access to the filing portal, including current passwords, so that the Applicant Mother may file claims for herself and Bradley. The Respondent Father must make reimbursement to the Applicant Mother within 24 hours from receipt of funds from the insurer. The Respondent Father shall repay the Applicant Mother for any expense or loss she incurs because of the Respondent Father’s failure to maintain or access the extended health or dental coverage as required by this Order.

15. If the Applicant Mother obtains a medical, extended health or dental insurance coverage plan through an employer that is equal to or better than the Applicant Fathers, she will notify the Respondent Father of such, and he may then remove her from his medical, extended health or dental insurance. If the Applicant Mother obtains coverage lesser than the Respondent Father currently has, she will allow the Applicant Father to utilize her plan for any portions of the child, Bradley’s, medical or dental expenses that were not covered by his plan. Reimbursement will be made by the Applicant Mother to the Respondent Father within 24 hours of the receipt of funds to her from the insurer.

Costs

122If counsel cannot agree on costs, I will receive written submissions on a 7 day turnaround, commencing with the Applicant on January 12, 2024, followed by the Respondent’s submissions on January 19, 2024, then the Applicant’s reply submissions, if any, on January 26, 2024. Cost submissions shall be no more than 4 pages in length (12 pt font size, regular 1 inch margins, 1.5 spacing), exclusive of any costs outline or offers to settle. All costs submissions shall be delivered via email through my judicial assistant at barriejudsec@ontario.ca. If no submissions are received within 30 days from the date of this endorsement, the issue of costs will be deemed to have been settled between the parties.

R. S. Jain J.

Footnotes

1. 1Exhibit 7
2. 2Applicant’s affidavit dated March 15, 2023 para. 49
3. 3Applicant’s affidavit dated March 15, 2023, para. 16
4. 4Exhibit 3
5. 5Exhibit 13
6. 6Applicant’s affidavit dated March 15, 2023, para. 6
7. 7Applicant’s Affidavit dated March 15, 2023 para. 33, Exhibit “E” - The valuation states that the “fair market value” of the entire business WIV FM Radio Ltd. is $404,114. The valuation shows that for three years in a row, the WIV FM Radio Ltd. loaned thousands of dollars to KBC. In 2018 the loan was $5,245.55. In 2019 and 2020 there were loans of $20,000 in each year. Further, “KC” was paid commissions and management fees in each of those years as well. The printing is unclear so I cannot read the exact amounts, however, in 2018 “KC” received approximately $21,000 in commissions plus $30,000 management fee. In 2019 “KC” received approximately $27,000 in commissions and $40,000 in management fees. In 2020 “KC” received approximately $23,000 in commissions and $30,000 in management fees. There is no evidence that these loans are required to be paid back or have been paid back, yet the Respondent does not claim this as income.
8. 8Applicant’s Affidavit dated March 15, 2023 para. 34
9. 9Applicant’s Affidavit dated March 15, 2023 paras. 39-47
10. 10Affidavit of Sue Bragg dated March 15, 2023 para. 12.
11. 11Respondent’s Affidavit paras. 100-103
12. 12Exhibit 8
13. 13Exhibit 9
14. 14Exhibit 10
15. 15Exhibit 11
16. 16Respondent’s Affidavit at para. 131
17. 17Respondent’s Affidavit at para. 193-204
18. 18Respondent’s Affidavit at para. 63
19. 19Respondent’s Affidavit paras. 111-119
20. 20Respondent’s Affidavit para. 122
21. 21Moge v. Moge 1992 CanLII 25 (SCC), [1992] 3 S.C.R. 813
22. 22Martel vs. Martel, 2007, SKQB 227
23. 23Shaw vs. Shaw, (1997), 1997 CanLII 22924 (MB QB), 120 Man.R. (2d) 310 (Q.B.)
24. 24Boston v. Boston, 2001 SCC 43
25. 25Orser v. Grant, 2000 CanLII 4367 (ON CA), [2000] O.J. No. 1669 (Ont. S.C.)
26. 26Bac v. Dobelle, 2007 ONCA 304
27. 27Bak v. Dobell, 2007 ONCA 304, 86 O.R. (3d) 196.
28. 28Leitch v. Novac, 2020 ONCA 257, 150 O.R. (3d) 587, at para. 44.
29. 29See Whiteside, v. Govindasamy, 2021 ONSC 789, 2021, at para. 46.
30. 30Respondent’s Affidavit dated March 30, 2023 para. 184
31. 31Respondent Affidavit dated March 30, 2023 para .196
32. 32Endorsement dated August 28, 2019 para. 15
33. 33Affidavit of Respondent dated March 31, 2023, Exhibit “O”
34. 34Affidavit of Sue Bragg dated March 31, 2023 para. 5
35. 35Affidavit of Sue Bragg dated March 15, 2023 para. 8
36. 36Affidavit of Sue Bragg dated March 15, 2023 para. 9
37. 37Affidavit of Sue Bragg dated March 15, 2023 para. 7
38. 38Ibid
39. 39Ibid para.5.
40. 40Ibid para. 11.
41. 41Exhibit 3, Affidavit of Sue Bragg dated March 15, 2023
42. 42See Whiteside, at para. 46.