Court File and Parties
COURT FILE NO.: FC-23-248 DATE: 2024/08/07 ONTARIO SUPERIOR COURT OF JUSTICE
BETWEEN:
AMANDA LAROCQUE-SEEGOBIN Applicant – and – MOHAMMED NAJIB AL-BAKRI Respondent
Counsel: Valerie Akujobi, for the Applicant Rod Vanier, for the Respondent
HEARD: August 6, 2024, at Ottawa
Reasons for Decision
WILLIAMS J.
[1] The applicant, Amanda Larocque-Seegobin, has brought a motion for child support and spousal support. The applicant also seeks an order that would prohibit the respondent, Mohammed Najib Al-Bakri, from participating in this proceeding, because he has failed to comply with two disclosure orders, an order of Kaufman, A. J. (as he then was) [1] from May 2023 and an order of Swartz J. from June of this year. The applicant also seeks information from a non-party, on whom she served her motion materials.
[2] The applicant asks that an annual income of $100,000 be imputed to the respondent for purposes of calculating support.
[3] The applicant’s position was clearly set out in her factum. In an endorsement dated June 6, 2024, Swartz J. ordered the parties to file factums for this motion. The respondent did not file a factum. I accept the respondent’s counsel’s explanation that the associate tasked with preparing the respondent’s factum left his law firm abruptly, and that it was then too late to prepare a factum in time for the filing deadline. The respondent’s counsel did not, however, explain why no effort was made to comply with Swartz J.’s order either by requesting the applicant’s counsel’s consent to file a factum after the deadline or by seeking leave to file in court.
Background
[4] The applicant is 35 years old. The respondent is 39. They separated on May 1, 2022. They continued to live at the same address until the applicant moved out in the fall of 2022. The parties have a son, who is three years old. The parties share time with their son on an equal basis. The applicant earns slightly more than $55,000/year. The respondent’s income is at the core of this dispute. The parties were together in a common law relationship for 17 years. The applicant characterizes the relationship as abusive, which the respondent denies. I note that on March 16, 2023, Shelston J. granted the applicant’s request for a restraining order.
[5] The respondent paid approximately $170/month in child support to the applicant from February 2023 until May 2023. He has not paid any child support since that time.
Should income be imputed to the respondent?
[6] Although I did not have the benefit of a written argument from the respondent, his position was made clear in his counsel’s oral argument: The respondent says he has no money.
[7] The respondent’s failure to comply fully with the May 2023 and June 2024 disclosure orders combined with questions arising from the documents he has produced make his position difficult to accept.
[8] In her detailed June 6, 2024 endorsement, Swartz J. gave the respondent 30 days to produce all outstanding and relevant disclosure. This included bank statements and very specific and clearly defined documents relating to a restaurant business the respondent became involved in in the second half of 2023.
[9] The respondent produced no new disclosure by the 30-day deadline. He then provided some but incomplete disclosure on July 16, 2024.
[10] The respondent’s counsel suggested that I might give the respondent an additional 60 days to continue his production efforts. In my view, however, this would not be fair to the applicant. The respondent has had ample time to comply with both orders. Kaufman J.’s order was made 15 months ago and has not been complied with. Further, in light of some of the observations I make below, I am not convinced the respondent has been making good faith efforts to date to disclose information that would permit the applicant to ascertain his true financial situation, or that an additional 60 days would make any difference. The respondent cannot have expected a further extension of time; in her June 6, 2024 endorsement, Swartz J. noted that two hours had been spent discussing disclosure that day and ordered that any non-compliance with the terms of her order were to be addressed at the return date of the motion.
[11] In her affidavit of July 23, 2024, and more particularly in a detailed chart attached to the affidavit as Exhibit F, the applicant listed the disclosure the respondent was ordered to produce by Kaufman J. and Swartz J., the disclosure that has been produced to date and the disclosure that remains outstanding. The outstanding disclosure is significant both in terms of quantity and relevance and inferences may be drawn from what is missing. For example:
- The respondent has not produced commission statements for his work as a mortgage broker in 2023. There is evidence that he earned $86,017 in commissions in 2021, $146,000 in commissions in 2022 and $21,122.19 in commissions from January to May 2024. The respondent’s counsel says the respondent’s 2023 commission income is evident from a 2023 corporate tax return. The respondent’s counsel says the respondent’s 2023 income was $29,000. The applicant’s counsel says she has not been able to locate support for the respondent’s counsel’s submission in the disclosure that has been provided. The respondent’s counsel does not suggest the respondent has produced the actual commission statements for 2023.
- Although specifically ordered to do so by Swartz J., the respondent has not produced income and expense statements for the restaurant, lease agreements relating to the restaurant or documentary evidence in support of his affidavit evidence that the business was evicted from the leased premises for non-payment of rent.
- The respondent has not produced all of his bank statements. Missing statements include those from July to December 2023, when the respondent’s involvement in the restaurant business appears to have begun.
[12] The respondent’s counsel argues that given the respondent’s commission income was $21,122.19 in the first five months of this year, his gross commission income for the year should be considered to be in the $50,000 range on an annual basis. The respondent’s counsel submits that even on a gross basis, the respondent is earning less than the applicant.
[13] In his affidavit, the respondent says his financial situation deteriorated after 2022 because of “the high interest rate environment we now see in the Canadian economy.” That is the full extent of his explanation.
[14] Although the respondent’s counsel conceded that, on the evidence, it would be reasonable to conclude that the respondent will earn gross annual commissions of approximately $50,000 this year, in his affidavit, the respondent says that “in order to find a way forward” he has enrolled in school full-time. This news appeared to have come as a surprise to the applicant, who says that when the parties appeared before Swartz J. on June 6, 2024, the respondent did not mention any plans to return to school. The respondent attached enrolment documents to his affidavit. The documents show he has enrolled in a human resources management course with the Canadian College of Business, Science & Technology.
[15] The respondent says he has also applied for a student loan.
[16] The enrolment documents are dated July 3, 2024, three days before the disclosure production deadline under Swartz J.’s order. The respondent says the course he is taking in online and will last one year.
[17] The respondent did not explain whether, in order to take this course, he has abandoned his work as a mortgage broker entirely, if so, why he has done so, or whether he plans to continue to work on a full-time or part-time basis.
[18] The respondent’s disclosure with respect to the restaurant business also raises questions. The respondent says he became involved in the restaurant in the fall of 2023. He says that because of non-payment of rent, the landlord changed the locks on June 1, 2024, and gave him and his partner a notice of eviction. The respondent says he has had nothing to do with the restaurant since that date. The respondent produced a letter dated June 1, 2024, which he described as a notice of eviction. The letter was not a notice of eviction. The letter said that the respondent and his partner had informed the landlord that they would be unable to pay rent for June 2024. The landlord demanded payment and threatened eviction. However, the landlord also said he remained open to finding an amicable resolution and asked that the respondent and his partner to arrange a meeting with him. There is no evidence before me of an eviction.
[19] Other financial information disclosed by the respondent also raises more questions than it answers. For example, in a financial statement sworn in March 2023, the respondent said he owned a 2004 Lamborghini worth $70,000, a Sea Doo worth $5,000 and a Hyundai Santa Fe worth $36,000. In a December 2023 financial statement, the respondent said the Lamborghini was sold and the Sea Doo needed repairs and he described the Hyundai as “leased.” He did not indicate how much he had been paid for the Lamborghini and there was no indication of any associated improvement in his cash situation. Neither the Lamborghini, the Sea Doo nor the Hyundai appear on a financial statement the respondent swore on May 31, 2024. The respondent’s counsel said the Lamborghini was sold to pay a debt. However, there was no evidence in respect of the debt and no evidence to support the counsel’s statement in any event. Despite the reference to a Sea Doo in two of the financial statements, the respondent’s counsel said the respondent had never owned a boat, information which only could have come from the respondent. In an affidavit sworn July 26, 2024, the respondent referred to funds he spent on repairs to his BMW X6. There is no reference to this vehicle in any of his financial statements. His May 2024 financial statement does not refer to any car lease payments.
[20] Timely disclosure of financial information is the linchpin of a just and effective family law system. (*Colucci v. Colucci*, 2021 SCC 24, at para. 4).
[21] The *Child Support Guidelines* allow for imputation of income to a spouse in several situations, including where “the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse” (s. 19(1)(a)) and where "the spouse has failed to provide income information when under a legal obligation to do so" (s. 19(1)(f)).
[22] Parents have an obligation to support their children. To meet this obligation, they must earn what they are capable of earning. If they fail to do so, they will be found to be intentionally under-employed: *Drygala v. Pauli* (2002), 61 O.R. (3d) 771 (C.A.).
[23] In para. 23 of Drygala, the Court of Appeal set out a three-part test for determining whether income should be imputed on the basis of intentional under-employment or unemployment as follows:
- Is the spouse intentionally under-employed or unemployed?
- If so, is the intentional under-employment or unemployment required by virtue of his reasonable educational needs?
- If the answer to question #1 is negative, what income is appropriately imputed in the circumstances?
[24] Though the court in Drygala dealt with imputing income for the purposes of child support, this test is equally applicable to claims for spousal support: *Crowe v. McIntyre*, 2014 ONSC 7106.
[25] The onus is on the party seeking to impute income to establish that the other party is intentionally unemployed or under-employed. This must be established on an evidentiary basis. 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. Although underemployment requires a voluntary act by the payor, there is no need to establish a specific intent to evade child support obligation. When an employment decision results in reduced or no child support being paid, it needs to be justified in a compelling way. (*Abumatar v. Hamda*, 2021 ONSC 2165, at para. 28).
[26] In this case, the respondent has clearly failed to provide complete income information, despite having been clearly ordered to do so in May 2023 and again in June 2024. It is, therefore, open to me to impute income under s. 19(1)(f) of the *Child Support Guidelines*.
[27] I am also satisfied that, in these circumstances, I may also impute income under s. 19(1)(a) of the *Child Support Guidelines*. The applicant has shown that the respondent was capable of earning commissions of $86,017 in 2021 and $146,000 in 2022. The respondent was funding a lifestyle that was not frugal: In March 2023, he owned a 2004 Lamborghini worth $70,000. Somewhere along the way he acquired a BMW X6. The respondent began to operate a restaurant in late 2023 and says he has not had any involvement in the restaurant since June 1, 2024. Now he says that “to find a way forward”, he is enrolled in school on a full-time basis. The respondent has not provided compelling evidence to satisfy me that his intentional under-employment or unemployment is required by virtue of his reasonable educational needs or any other legitimate reason. While I question the respondent’s assertion that he has no money, I am satisfied that he is intentionally under-employed or unemployed.
[28] For these reasons, I have concluded that it is appropriate to impute income to the respondent.
If income is imputed, what is the appropriate amount?
[29] The respondent’s counsel submitted that, because the respondent earned $21,122.19 in commissions from January to May 2024, it would be reasonable to assume that his commissions this year on an annual basis would be $50,000.
[30] As I mentioned above, the respondent admitted that he earned $146,000 in commissions as a mortgage broker in 2022. While he says that this was an unusually good year and that his financial situation has since deteriorated significantly because of high interest rates, he did not provide any information about his business or how or why it was affected by the higher rates nor did he produce any commission statements for 2023, although he was able to produce statements for the first five months of 2024.
[31] Given the level of the respondent’s commission income in 2021 ($86,017) and 2022 ($146,000), his failure to disclose his 2023 commission statements, his failure to disclose bank statements from July to December 2023, his lack of disclosure overall and the questions raised by disclosure he has provided, I am satisfied that imputation of income to the respondent in the amount of $100,000 would be appropriate and fair in this case. Acknowledging the respondent’s evidence that he had a very good year in 2022, $100,000 is two-thirds of the amount of his commissions in 2022; it also recognizes that he would have been required to pay some expenses from the gross commissions. His expenses appear to be modest. His commission statement from January to May 2024, for example, shows expenses of at most $977 on commissions of $21,122.19.
[32] I am satisfied that the respondent has the capacity to earn income at the $100,000 level, given his past experience and the lifestyle he was able to fund at least pre-separation. There is no evidence of any health or family-related reason why he is not capable of doing so.
How much child support should be payable?
[33] In her factum, the applicant has requested an order that the respondent pay child support for their son in the amount of $397 per month, commencing May 1, 2023, based on an income of $100,000 imputed to the respondent and the applicant’s income of $55,619.
[34] The respondent shall pay the applicant child support in the amount of $397 per month, commencing May 1, 2023.
Section 7 Expenses
[35] The parties shall share Section 7 Expenses, proportionate to these incomes, i.e. $100,000 for the respondent and $55,619 for the applicant.
Is the applicant entitled to interim spousal support?
[36] The applicant has requested interim spousal support in the amount of $500 per month. She says that, at this time, she is not seeking past spousal support.
[37] The parties were not married. The applicant’s request is under the *Family Law Act*.
[38] The applicant seeks spousal support on a non-compensatory basis. The applicant says she is in dire financial need. She says she was required to leave the matrimonial home because of the respondent’s abuse and was required to start over, while caring for the parties’ son 50 per cent of the time. The applicant says her work hours have been reduced by her employer. She also says the respondent’s disregard for court orders has required her to incur unnecessary legal fees.
[39] The respondent questions the applicant’s claim that she has a need for spousal support. He notes that she has not received any spousal support to date. The respondent denies that abuse played a role in their relationship.
[40] The purpose of interim spousal support is to make reasonably adequate provisions pending trial. The order may be adjusted at trial, upward or downward, based on a more complete evidentiary record.
[41] The applicant has satisfied me that she is entitled to needs-based support on an interim basis. She left the matrimonial home and has been required to set up a new home for herself and the parties’ son. She says her work hours have been cut back. The respondent’s imputed income is significantly higher than hers. The DivorceMate calculations the applicant has filed shows that, assuming the imputed income of $100,000 for the respondent, the applicant’s income of $55,619 and child support of $397, mid-range support would be $344 and high-range support would be $1,001.
[42] In my view, interim spousal support at the mid-range amount of $344 would be appropriate. The respondent shall pay spousal support in the amount of $344/month commencing August 1, 2024.
Should the respondent be prohibited from further participation in the litigation due to his failure to disclose?
[43] The applicant requested an order under s. 1(8) of the *Family Law Rules* prohibiting the respondent from further participation in this proceeding due to his failure to comply with the disclosure orders.
[44] I am not prepared to make such an order at this time. At this time, I am of the view that a costs order would be a more appropriate response to the respondent’s non-compliance. I am inclined to agree with the respondent’s counsel’s submission that, for now at least, it is preferable for the respondent to be participating in the proceeding than not. This decision is, however, without prejudice to the applicant’s right to renew her request in the future if the respondent’s non-compliance continues.
Should an order be made against the lender?
[45] The respondent has produced a loan agreement for $50,000 he said he borrowed for the restaurant. When the applicant’s counsel contacted Adil Rahman, the lender named in the agreement, to request further information, Mr. Rahman did not reply. Shortly afterward, however, someone from the respondent’s counsel’s office (not Mr. Vanier) wrote to the applicant’s counsel and asked her to identify members of her family who had dealings with the lender. The relevance and appropriateness of such an inquiry are not immediately obvious to me. The applicant’s counsel said she had no knowledge that any members of her family had had any dealings with the lender.
[46] The applicant served her motion materials on Mr. Rahman. The applicant seeks an order compelling Mr. Rahman to confirm that funds were in fact advanced to the respondent. Mr. Rahman is not a party to the proceeding. The *Family Law Rules* provide a procedure for questioning or obtaining disclosure of information from non-parties. The applicant’s request for relief against Mr. Rahman is denied.
Costs
[47] The applicant shall file a costs outline and brief (no more than three pages) written costs submissions within seven days. The respondent shall file a costs outline and brief (no more than three pages) responding submissions within seven days of receipt of the applicant’s outline and submission. The applicant may, at her option, file a brief (no more than two pages) reply submissions within seven days of receipt of the respondent’s costs outline and submission.
[48] The timelines for the costs outlines and submissions may be extended by the parties on consent, with notice to me at scj.assistants@ontario.ca.
Madam Justice Heather Williams Released: August 7, 2024
[1] Kaufman J. was an associate justice at the time he made the order. Going forward, I will refer to him as Kaufman J., as he is now.