ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Randa Issa
Applicant Mother
– and –
Ramzy Haidar
Respondent Father
Sarah M. Boulby, for the Applicant Mother
On his own behalf
HEARD: June 4, 5, 6 and 7, 2024
JUSTICE ALEX FINLAYSON
PART I: INTRODUCTION
1Except for a dispute about the enforceability of one clause in Minutes of Settlement concerning a narrow parenting issue, this family law trial concerned only financial issues. Although a number of questions of fact and certain of the parties’ substantive claims settled prior to the start of this trial, there still remained a considerable number of issues to be litigated. Child support, special or extraordinary expenses pursuant to section 7 of the Federal Child Support Guidelines (the “Guidelines”), and spousal support for periods prior to this Order, remained. So did prospective spousal support.
2The determination of the father’s income, and the consequent calculation of past and future support that have to be done, are rendered complicated by a plethora of factors arising out of the fact that the father lives in Switzerland, a jurisdiction in which he pays significantly less tax, compared to Ontario. The father, who could have afforded counsel to assist him at this trial, chose to represent himself, as is his right. While he sometimes looked to the Court for guidance about procedure (which the Court provided), he also took positions that were either lacking in merit, or which he could not prove. In the end, he raised, but then obfuscated, one meritorious argument about the calculation of spousal support.
3The father argued that income should be imputed to the mother, without regard for the reality, that she now has, and will into the unforeseen future have, the sole responsibility to care for the parties’ two children, one of whom has a very high degree of special needs. The father also attempted to prove that the Court should determine his income for spousal support and section expenses on a reduced basis, to account for the alleged higher cost of living in Switzerland. Not only is this not authorized by the income determination provisions of the Guidelines, and not something about which this Court can take judicial notice about (which he nevertheless argued), but he also failed to call the evidence that would have been needed for his argument, had it been a proper one.
4The father did not need to frame his argument about his ability to pay in this fashion. The Court can validly consider the parties’ financial positions as a result of any support Order it makes, when fashioning a support award that is fair to both sides.
5The father failed to provide full information about his 2023 income too, and importantly about his current tax situation. On the one hand, the father’s 2023 Swiss tax return was unavailable until soon before the trial. While that is a function of timing for which the father cannot be faulted, his failure to then disclose it in full once he had it, rests entirely on his shoulders. And when he did in the end produce the tax return translated into English (about three weeks before the start of this trial), he did so after having redacted information about his new spouse, and consequently his new tax rate as a result of his remarriage and relocation to elsewhere in Switzerland.
6The father did not properly instruct his valuator, David Ogilvie, to determine his income for 2023 in the Supplementary Schedules he prepared, either. Even his own expert had to make assumptions about 2023 taxes.
7Finally, while the father’s Excel Spreadsheet that he tendered at the end of the trial does purport to address a valid consideration, about his ability to pay and his financial picture after any support Order that this Court might make, the father did not calculate that cash flow problem properly, based on all sources of income available to him. His attempt to argue based on his “base salary” only, was misleading.
8For her part, the mother chose not to call her valuator to testify, despite having listed him as an expert witness on the Trial Scheduling Endorsement Form. She instead relied on a number of facts about the father’s income in a Statement of Agreed Facts (the “SAF”), as was her right. But the SAF only resolved some facts, needed for portions, but not all of the support analysis. While the SAF does not address the father’s 2023 income and tax rates, because the information needed to do so was not available as just explained, the SAF does not address the components of the father’s income for 2022 in full, either.
9The father’s Guidelines incomes for 2019 to 2022 are set out in the SAF, but in a certain respect, the wording of the SAF is ambiguous. And the methodology underlying the calculations of those incomes is not fully explained, either. The mother’s valuator played a role in determining and applying the methodology, but the mother did not call him to explain it. 1
10The Court asked a number of questions and heard submissions about the proper method for calculating spousal support at the end of the trial, because there were issues about the proper approach to that. While the mother asks the Court to apply the “With Child Support” Formula of the Spousal Support Advisory Guidelines ( the “SSAGs), the established methodology underlying that Formula was not set out in the SAF, nor was spousal support quantified, either. The mother tendered DivorceMate calculations using the father’s grossed up incomes in the SAF, but she inserted those into the software as Ontario earned employment income to calculate spousal support, which it was not. She made no further adjustments to account for the tax issues. She also argued that the father’s valuator created a new, “unprecedented” methodology, when calculating different support scenarios in the supplementary schedules.
11As I explain in more detail below, the “With Child Support Formula” of the SSAGs uses gross incomes for child support and section 7 expenses under the Guidelines. Contrary to what the mother submitted during closing submissions, net incomes are used to calculate spousal support. A further problem, acknowledged right in the body of the SSAGs and repeated in the SSAGs Users Guide, 2016, arises when a payor legitimately2 earns income that is not subject to tax, or that is subject to little tax. The father will not get the benefit of a higher tax deduction at Canadian and Ontario tax rates on the spousal support he pays, because taxes were never paid at that level in the first place. When a payor works and earns income abroad, where he is legitimately subject to a different tax system, and where grossed up income is inserted into DivorceMate without regard for that, the software does not properly net down the income as is required under the “With Child Support” Formula to begin with, and it does not correctly calculate the deductibility of any spousal support paid either. Rather, the software uses Canadian tax rates for both exercises. The effect of using DivorceMate in the circumstances of this case, is to generate higher quantums of spousal support, premised on higher net disposable incomes for the father in the end result than he actually enjoys. This problem is a recognized exception in the SSAGs, that I find warrants adjustments to the mother’s calculations.
12The mother incorrectly calculated the section 7 expenses that she says are owing to her in an Excel Spreadsheet and summary calculation sheet, tendered for closing submissions, also. There are some not insignificant discrepancies in these documents. She failed to fully credit the father for the prior payments he made.
13While this Judgment was under reserve, the Court then realized that the mother neglected to include in her calculations, that in several years since the separation, she had been deducting legal fees from her income when preparing her tax returns. While she is entitled to that deduction, the failure to include it in the calculations alters the outcome. Just like the father, she too has paid little in tax. In fact, she paid no tax in 2020, almost no tax in 2021, no tax in 2022 and no tax in 2023, in part because of this.
14These are just a summary of some of the gaps and errors that the parties left the Court to deal with at the end of this trial. There were more, such as a gap in the evidence about the costs of disposition on the father’s Swiss Pension, that he tried to claim as a deduction in the calculation of his net family property.
15As a result, the Court has grappled to balance the interests of both parties and to come up with a result that is fair and just to both sides. Especially with respect to the calculation of past and future section 7 expenses and spousal support, a more refined analysis and calculations, than what the Court was supplied with, is required.
16The Court could have benefitted from additional expert assistance. Instead, there was no Mr. Ranot, and Mr. Ogilvie’s calculations, while partially helpful, were prepared based using certain assumptions that the father did not prove at trial. There were no tax calculations for the disposition costs on the pension at all.
17The Court considered several options to remedy this, including appointing another expert, but it in the end chose not to do so for several reasons, including the mother’s strenuous objections to it doing that. The result is that the Court has had to resort to a combination of adverse inferences, and otherwise it engaged in laborious support calculations of its own. The final property and support calculations are attached as Schedules “A” through “C” to this Judgment.
18I will give detailed explanations behind my methodology. To the extent that they are lacking in complete precision based on the absence of certain information, the filing of a misleading cash flow chart, or the tendering of inaccurate support calculations, one or the other of the parties, or both of them, need to accept responsibility for that.
PART II: BACKGROUND
19The parties were married for 12 years and 4 months, between December 29, 2006 and their separation on May 3, 2019. The parties lived in Switzerland for most of their marriage. In July of 2016, about 3 years prior to the separation, and with the consent of the father, the mother returned to Ontario, with the parties’ two children, J., now age 11, and V., now age 9. V. was not yet in school when the mother returned here. There was some discussion about the father following suit, but that did not materialize.
20Since their move here, the mother and the children have resided with the maternal grandparents in Markham. The parties are already divorced by Order of Bennett J. dated May 9, 2022.
21The mother did not work during the marriage. She has not done so since the separation. She was, and continues to be, the children’s primary parent. Although there is a settlement that provides for parenting time to the father in Ontario, achieved following a custody and access assessment pursuant to section 30 of the Children’s Law Reform Act, the father has decided he will not come to Canada to exercise it. 3 The mother spends the majority of her time parenting the two children alone, without assistance from the father.
22V. has a high degree of special needs. She has been diagnosed with Autism Spectrum Disorder. Her condition is described in fairly severe terms. The mother describes J. as exceptionally bright, but says that gives rise to a different set of special needs on his part. He was bored in a regular classroom.
23Both children attend an online virtual school through a Catholic school board. Virtual school was initially put in place after the mother’s return to Canada, and after the Covid-19 pandemic struck. The children have continued in a virtual school since the pandemic.
24The mother’s sole parenting responsibilities include her spending 6 days per week supporting V.’s high needs. She supports V. in her online schooling and therapy. She also works with J. in the evenings.
25The mother, who previously had temporary decision-making responsibility respecting both children under the temporary Order of Douglas J. dated November 13, 2019 (and still does now under the Final Minutes of Settlement dated August 22, 2023), has already validly made the decision that this virtual school best suits the children’s needs. While the father disagreed with that decision during this trial, apart from perhaps the financial implications of the choice, the mother’s decision does not concern the Court. Regardless, the evidence that the mother called at this trial, established that both children’s different needs are well served in this educational arrangement.
26The father worked in IT throughout the marriage. He has continued to do so after having chosen to stay in Switzerland. Several years ago, but during the marriage, the father pursued a MBA degree on a part-time basis, funded by his father. The characterization of that advance from the paternal grandfather is the most significant net family property issue in dispute. The MBA is also relevant to support, as the father’s income increased after he obtained it.
27The father had various IT jobs over the course of the marriage, including some periods of prior job loss. His penultimate job was with Pegasystems AG in Zurich. He was terminated from it in late 2021. The father quickly obtained new employment, perhaps in part because he was armed with the MBA. Since January 20, 2022, he is now employed as a “Senior Success Manager” for a company called Sprinklr, also in Zurich.
28The father has re-partnered with a physician, who works for a pharmaceutical company. He did not disclose her income. He then claimed during this trial in response to questions from this Court, that she earns 130,000 CHF, although he did not provide disclosure of that. According to Footnote 3 of Mr. Ogilvie’s Supplementary Schedule 2 (Ex 24), he seems to have told Mr. Ogilvie that she only makes 88,000 CHF.
29The father’s new spouse has two children of her own from a prior relationship, with whom the father now lives. Very little else is known about her, and this new family constellation, particularly the financial and tax implications of this re-marriage.
30Either since his re-marriage, or in any event in more recent times, the father moved from a suburb of Zurich called Thalwil, to a different place in Switzerland. The fact that the father lives elsewhere, and the fact he has re-married, impacts his tax rates apparently in a manner that is adverse to the father, according to him. Other than from the general information that the father elicited from Simone De Turris, an expert on Swiss tax law whom the mother retained, and from the aforementioned Footnote in Mr. Ogilvie’s supplementary schedules/calculations, the true extent of the adverse impact is not known to the Court.
PART III: THE PRIOR PROCEEDINGS
31The mother started this proceeding on June 17, 2019. Some of this Court’s prior temporary Orders, the parties’ SAF, and a Final Consent Order, are relevant to the analysis upon which this Court now embarks.
32The first important event during the prior proceedings in this case was a motion about parenting issues. On November 13, 2019, Douglas J. made a temporary order that the children would reside with the mother, that she would have sole decision-making responsibility after consultation with the father, and that there would be a custody and access assessment by Dr. Irwin Butkowsky. Douglas J. also ordered that the father could have a number of specified visits with the children.
33At this trial, the mother introduced evidence of her concern that the father is a flight risk with the children. That was the case at the time of the prior parenting motion, too. There are seven terms in Douglas J.’s temporary Order, that then addressed the concern.
34In particular:
(a) Douglas J. ordered the father to deposit his Canadian and Swiss passports, and his expired Lebanese passport, with his lawyer, before exercising any parenting time. He allowed these to be returned to the father at the end of each of the periods of his time in Canada, allocated for his visits;
(b) Douglas J. granted a non-removal order;
(c) Douglas J. directed that the Canada Border Services Agency was to be notified before the father exercised his parenting time;
(d) Douglas J. provided that the children’s names were to be added to the “Passport Canada Lookout List”;
(e) Douglas J. ordered that the mother was to retain the children’s identification documents, although the father could have copies of their health cards;
(f) Douglas J. prohibited the father from attending within 1 km of any international airport or border with the children, while they were in his care; and
(g) Douglas J. prohibited the father from applying for or obtaining a new passport, except upon 30 days’ written notice, to the mother.
35It is a similar term to the latter one that Douglas J. ordered, included in the Minutes of Settlement, that is now in dispute. In part because the father has decided not to travel to Ontario to see the children any more, he questions the evidentiary basis for the Court to order such a term, the lack of certainty underlying this term, the breadth of this term, the impact upon his “privacy” and the enforceability of this term.
36The second motion concerned child support, section 7 expenses, and spousal support. According to ¶ 127 of the SAF, between the date of separation and this motion, the father paid child support of $4,000.00 per month. The amount he was paying was too low. By the time of this motion, V. had just been diagnosed with autism but the parties did not then know how expensive V.’s therapy costs would be.
37On December 19, 2019, Kaufman J. ordered the father to pay child support in the monthly amount of $9,436.00 per month, inclusive of section 7 expenses, commencing January 1, 2020. This was based on estimated income of $346,582.00. He ordered the father to pay spousal support in the amount of $2,700.00 per month, also commencing January 1, 2020. He ordered the father to pay child support arrears of $8,046 and arrears of section 7 expenses of $1,198.50, which the mother says brought child support, but not spousal support, back to the date of separation. These arrears amounts were calculated after crediting the father the $4,000.00 that he had been paying in child support, and an additional amount of $2,454.00 voluntarily paid for section 7 expenses. I was told that Kaufman J. chose to order an above Guideline amount of child support given some of the complexities in this case.
38On March 15, 2023, the parties consented to another non-removal Order on a temporary without prejudice basis, in the Order of Bennett J. This Order also permitted the mother to apply for or to renew the children’s documents, including their passports.
39There are two further case management Endorsements of Bennett J. dated March 21, 2023 and August 4, 2023 in the Trial Record that address trial scheduling and other procedural matters. The Trial Scheduling Endorsement Form made provision for certain witnesses, who were not called.
40Finally, leading up to this trial, the parties entered into the SAF, which settled some, but not all important matters of fact. And on the day before the start of this trial, the parties settled some, but not all issues respecting prospective child support and section 7 expenses, and a minor issue about property, by way of the Consent Order of MacPherson J. dated June 3, 2024.
PART IV: WHAT IS AND IS NOT IN DISPUTE AT THIS TRIAL
41There are three different settlement documents before the Court that narrow, but do not fully resolve, the issues in dispute.
42Following Douglas J.’s temporary Order of November 13, 2019, Dr. Irwin Butkowsky undertook a custody and access assessment pursuant to section 30 of the Children’s Law Reform Act. The parenting issues later settled by way of Minutes of Settlement dated August 22, 2023, with the benefit of his lengthy assessment report.
43The Minutes of Settlement have not yet been incorporated into an Order of this Court because of the dispute over the term about the father’s passports. The mother brought a motion for summary judgment to obtain a Final Order incorporating the Minutes, returnable at this trial.
44There is the SAF. As stated above, while it narrows many questions of fact, it does not completely resolve all of the factual matters about which the Court needs to make findings. Nonetheless, it is important to set out in full, the parties’ ultimate agreement as to the father’s incomes, as this was very significant to the arguments, and ultimately for my analysis. It can be found in ¶ 155 of the SAF.
45Paragraph 155 of the SAF reads:
For the purposes of determining Ramzy’s income for support:
a. If it is appropriate to consider the cost of living and the Zurich: Toronto figures from Mercer are an appropriate measure, Ramzy’s income for the years 2019- 2000 inclusive was:
i. 2019: $350,000;
ii. 2020: $410,000;
iii. 2021: $390,000;
iv. 2022: $370,000.
b. If it is not appropriate to consider the cost of living, Ramzy’s income for the years 2019-2022 inclusive was:
i. 2019: $495,000;
ii. 2020: $600,000;
iii. 2021: $570,000;
iv. 2022: $550,000.
46Third, pursuant to the consent Order of MacPherson J. dated June 3, 2024, commencing on June 1, 2024, the father shall pay child support for the two children in the amount of $7,447.00 per month, based on agreed upon Guidelines income of $600,000.00. The children’s prospective section 7 expenses are also defined and fixed, even though spousal support was not determined at the same time. These future expenses will be for autism therapy, dental care, vision care and counselling. With the mother receiving any available tax benefit for the expenses, the agreed upon total to be shared is $40,000.00 per year. Another term in the consent Order provides that the father shall pay the mother $2,104.00 per month, as his contribution to that total annual sum, in addition to table child support.
47The consent Order also provides that the mother shall reimburse the father for $1,580.00 to resolve an issue about a joint GIC. This will be credited to the father, in this Court’s Order. There is a separate amount for 50% of the cost of the assessment, that I was told had been previously agreed to, and has to be credited to the father.
48But not all of the support and property issues are resolved in this consent Order, though. For example, in regards to retroactive section 7 expenses, the consent Order just lists what V.’s prior therapy costs between 2019 to 2023 were, but the apportionment of these expenses is neither dealt with in the Order, nor is the list of therapy expenses said to be an exhaustive list of all prior section 7 expenses. Although the mother would now have the father pay section 7 expenses for the first several months in 2024 prior to the Order, there are no receipts provided and the Order does not say this. Nor does the consent Order deal with table child support for prior periods, even though this ended up not really being a contentious issue. And, neither prior period nor prospective spousal support settled.
PART V: THE PARTIES’ POSITIONS
49In her draft Order tendered at the end of this trial, the mother asks the Court to order the father to pay spousal support of $12,007.00 per month, commencing June 1, 2024. She says this is the mid-range of the SSAGs, based on the father’s income of $600,000.00, set out in the consent Order of MacPherson J. dated June 3, 2024. To arrive at this sum, the mother used DivorceMate software.
50The mother also seeks “prior period support”4 in the net amount of $406,923.50, also relying on the DivorceMate software and the father’s incomes from ¶155(b) of the SAF. Her prior calculations include not only “prior period” spousal support at the mid-range of the SSAGs in each year between 2019 and the consent Order of MacPherson J., but also the father’s prior child support and section 7 expenses obligations between the date of separation and May 31, 2024. The mother separately prepared an Excel Spreadsheet that purports to credit all of the father’s prior payments, to arrive at this global net sum. There are errors in it.
51Aspects of the father’s positions on the unresolved support issues were not always clear to the Court, including as late as the closing submissions. The Court sometimes asked the father questions about his positions, he answered them, and then he conducted himself or said other things later, as if he hadn’t said what he had earlier said.
52One example relates to his past child support and section 7 expenses. While the father generally agreed that he has an obligation to pay child support and section 7 expenses, commencing upon the separation (but not necessarily to pay section 7 expenses in the proportion claimed by the mother, and not spousal support), this was not apparent throughout. At times I formed the impression that the father was pursuing his cost of living adjustment argument to calculate income for all support issues. But in his trial affidavit sworn May 6, 2024, the father said that the incomes in ¶ 155(b) of the SAF (no cost of living adjustment) were appropriate for table child support. In view of the Court’s ruling on the cost of living issue, any changing positions on this no longer matter.
53By the end of the trial, the father confirmed during submissions, that he agreed, that all of the past section 7 expenses in MacPherson J.’s June 3, 2024 Order, and the additional ones from the SAF and the mother’s trial affidavit, as summarized in the mother’s written closing submissions, were shareable, but he still would have the Court use his incomes determined in ¶ 155(a) to apportion these, because of the cost of living argument. He seemed to be under the impression that he had paid all these anyway, in view of the prior payments.
54Another example comes from the father’s proposed draft Order. It contains a series of terms that depart from the parties’ agreement about future section 7 expenses in MacPherson J.’s consent Order dated June 3, 2024. He included that there should be a review in a couple of years. If this draft Order was prepared prior to the settlement memorialized in the June 3, 2024 consent Order, the father did not then revise it before the end of the trial. Or, to the extent that the father was still pursuing, at the end of this trial, a future review for section 7 expenses, or to the extent that he expects this Court to order any of the other terms in his draft Order that conflict with what MacPherson J. ordered on June 3, 2024 on consent, those claims for relief are dismissed.
55What is clear from the father’s position, is that he believes that he does not owe anything for past child support or section 7 expenses, because of his prior payments, and he says nothing should be ordered for past or prospective spousal support too. The father’s position in respect of the latter, rests on his argument, that the Court should calculate spousal support based on an “individual net disposable income” (“INDI”) to him of $135,000.00 (which takes into account the cost of living issue), and an imputed income of $60,000.00 to the mother. He takes great issue with the fact that the mother is not working. He says that the children should start attending school in-person, or alternatively, the maternal grandparents can look after them (or perhaps even that J. can look after his sister at some point in the near future), while the mother obtains a job and goes to work.
56Even were the Court to adopt both of his positions about his INDI and imputing (which it will not), his own expert calculates that some spousal support would be owing. His alternative position, offered up only in response to questions from the Court during submissions, is that he should pay $1,000.00 per month in spousal support.
57The mother seeks an equalization payment of $86,932.92. She seeks prejudgment interest at 2%, from the date of separation to the date of this Court’s Judgment.
58The father by contrast says that his equalization payment is only $47,114.50, not $86,932.92. As I have already indicated, the most significant issue here that contributes to this spread, concerns the funds that the paternal grandfather advanced to the father several years ago, to complete the MBA program, and whether the advance was a loan or a gift.
59Otherwise, the father wants the Court to deduct the $1,580.00 adjustment that the mother owes him, which is agreed to in MacPherson J.’s June 3, 2024 Order. He also wants a deduction of 50% of the cost of Butkowsky J.’s assessment, in the amount of $21,680.00. Counsel for the mother agreed during submissions, that these were proper credits.
60Finally, in regards to the single parenting issue and the summary judgment motion about it, the father says that he understood the disputed term that requires him to give the mother notice of any passport renewals to apply only if he was going to exercise parenting time. He says that he signed the Minutes without recognizing an error. He makes various other arguments already alluded to, to explain why the disputed term should be severed from the Minutes, and not ordered. The mother frames her counter arguments, mostly based on the law of contract. She says the father is not entitled to rectification. The Court should simply incorporate the entirely of the Minutes of Settlement into an Order as is, according to her.
PART VI: SUMMARY OF THIS COURT’S JUDGMENT
61I intend in this Judgment, to first address the disputed net family property issues, the calculation of the equalization payment, prejudgment interest, and the credits to which the father is entitled under MacPherson J.’s June 3, 2024 Consent Order and for the mother’s share of the custody and access assessment. In view of the parties’ ultimate positions, it is unnecessary for the Court to embark upon any significant analysis of retroactive child support. The calculation of the father’s prior table child support becomes a straight mathematical exercise once the parties’ incomes are determined, which they already are in the SAF. So too would the apportionment of the agreed upon prior section 7 expenses, but for the complications the father raised about the cost of living adjustment.
62The Court intends to adopt the income figures in ¶ 155(b) of the SAF (for 2019 to 2022) for its calculations. The Court also finds that it has no other option but to adopt the mother’s position on his income for 2023, which is the same $600,000.00 figure as that agreed to in the June 3, 2024 Consent Order of MacPherson J. dated June 3, 2024. There is a gap in the evidence about what else the 2023 income might be, and the fault for that lies with the father.
63In my view, there also is very little issue about the determination of the mother’s incomes, and about her entitlement to spousal support, whether for prior periods or prospectively. Nor should there be any serious debate about what duration of spousal support this Court should order. While I will address these issues briefly since they were not agreed to, the real issue as I see it, is quantifying a spousal support award that is fair to both sides, and that the father can afford to pay. The Court’s Judgment substantially focuses on that.
64In so doing, I will explain why the Court is rejecting the cost of living argument that the father has raised. Although the wording is somewhat ambiguous, I do find the parties agreed to use one or the other sets of incomes in either ¶ 155(a) or 155(b) of the SAF for all support. But while they did not agree to use a different income5 for spousal support, they also did not anywhere in it, agree to the application of the SSAGs for spousal support, or if they should be applied, how the appropriate formula under it operates. I intend to engage in a more in depth review of how the “With Child Support” Formula operates and a careful review of the father’s financial position after the payment of child support and section 7 expenses for all years, to demonstrate why the Court intends to Order a different amount of spousal support then what was argued for by both sides.
65Although on their face the quantums in the Court’s Order appear to fall below the SSAG ranges, that is only so if the incorrect calculations that the mother supplied are used as the comparator. Using DivorceMate software exclusively in this case, as the mother has done, does not work. After making necessary adjustments, the Court is crafting an Order that falls at the true mid-point of what the “With Child Support” Formula provides for each of the years in issue. Alternatively, if my approach here is mistaken and the mother’s calculations are sound, then I would have found there to be an exception to the SSAGs in this case.
66To the extent that any of my analysis in this Judgment seems out of order, that is in part a function of the fact that some issues settled, and other did not. Nevertheless, the Court understands that it is to determine both the property issues and child support first, before spousal support.
67In summary, the Court finds:
(a) The father’s claim to deduct notional costs of disposition on his Swiss pension is denied;
(b) The father’s claim to deduct a loan to his father for his MBA at the date of separation is denied;
(c) The father shall therefore pay to the mother an equalization payment of $86,932.32;
(d) The father shall pay to the mother prejudgment interest on the equalization payment, in the amount of $9,226.73;
(e) On consent, the father shall receive the credit of $1,580.00 that is provided for in ¶ 7 of the Order of MacPherson J. dated June 3, 2024;
(f) On consent, the father shall receive a credit of $21,680.00, representing 50% of the cost of Dr. Butkowsky’s assessment;
(g) In full and final satisfaction of retroactive section 7 expenses, the father shall pay to the mother the sum of $45,838.50;
(h) In full and final satisfaction of retroactive spousal support, the father shall pay to the mother the lump sum of $261,590.00;
(i) In addition, the father owes the mother the sum of $58,400.00 for spousal support for the period January 1, 2024 to August 1, 2024;
(j) Commencing September 1, 2024, the father shall pay to the mother spousal support in the amount of $10,000.00 per month;
(k) The Minutes of Settlement dated August 22, 2023 shall be incorporated into a Final Order of this Court in their entirety; and
(l) The lump sums for the equalization payment and support being ordered are subject to a possible further Order about a method of repayment. The Court is prepared to hear limited additional submissions about this.
PART VII: THE CONDUCT OF THIS TRIAL AND THE PARTIES’ MOTIONS TO STRIKE
68Both parties tendered affidavit evidence in partial substitution for examination-in-chief.
69The parties each raised preliminary evidentiary objections to aspects of the other’s affidavit. I indicated I would deal with these objections later on. In view of the Court’s rulings in this Judgment, particularly about the outcome of the cost of living issue, whether to impute an income to the mother, and the father’s 2023 (and prospective) Swiss tax rates, a number of the evidentiary objections are now moot.
70Nevertheless:
(a) In Schedule “A” to the mother’s motion to strike dated May 16, 2024, she lists a number of paragraphs or portions of paragraphs in the father’s trial affidavit, that she characterizes as “inadmissible hearsay statements”. These also include alleged children’s hearsay statements. Not all of the listed statements are necessarily tendered for the truth of their contents. Some of the children’s statements might be admissible under the state of mind exception. Some of the complained of paragraphs, like the use of the words “verbally assault me” are not even statements per se, this could also be an observation of behaviour, or a description of how the father experienced an interaction;
(b) In any event, to the extent that the complained of statements in the father’s trial affidavit emanate from others, were made out of court, and were tendered for the truth of their contents, then I agree they are hearsay. But none of them are being relied upon to decide an issue in this case. They are also not particularly relevant;
(c) In regards to paragraph 113 of Schedule “A”, which references portions of the father’s trial affidavit, where he sets out some strings that he says were attached to the paternal grandfather’s advance for the MBA, this is not necessarily a hearsay statement of the grandfather, either. It could also be evidence from the father, about what he understood his father’s expectation of repayment was. In any event, the paternal grandfather filed an affidavit of his own, testified and was cross-examined. This particular objected to paragraph is also moot as a result of my ruling;
(d) In Schedule “B” of the mother’s motion to strike dated May 16, 2024, she lists various paragraphs or portions of paragraphs from the father’s trial affidavit, said to contain “Inadmissible Opinion Evidence” about the cost of living, whether income should be imputed to the mother, and Swiss tax rates. These issues are all dealt with on their merits elsewhere in this Judgment. As this Court is neither ordering a cost of living adjustment, imputing income, or basing its decision on higher Swiss tax rates in 2023 (or going forward), these objections are likewise all moot. That said, later on, I specifically deal with the problems with the father’s evidence, particularly respecting the cost of living and 2023 tax rate issues; and
(e) In regards to the father’s motion to strike dated May 17, 2024, in which he takes issue with various paragraphs or portions thereof, of the mother’s affidavit sworn May 3, 2024 (and which follows the exact same format as the one from the mother, the day earlier), it is dismissed in its entirety;
(f) In particular, the father takes issue with the statement in the mother’s trial affidavit about him having family members who live in “Hezbollah controlled areas of Lebanon”. While this may or may not be true, these statements are inflammatory. I address this evidence in relation to the motion for summary judgment later on. For the purposes of his motion to strike, these are not hearsay statements though;
(g) On the one hand, the foundation for the mother’s statements about what she believes to be true respecting the advance of funds for the MBA is not adequately fleshed out. Nor are the statements of her belief particularly helpful to my decision. But once again, none of the statements about this listed in Schedule “A” to the father’s motion to strike are necessarily “inadmissible hearsay statements” as he claims; and
(h) In regards to Schedule “B” of the father’s motion, which extracts a portion of ¶ 56 of the mother’s May 3, 2024 affidavit, where she lists various therapy costs that she wants apportioned, this is not “inadmissible opinion evidence”. I question whether the father understood what “inadmissible opinion evidence” meant, when copying the format of the mother’s Notice of Motion to claim that the mother violated this evidentiary rule.
PART VIII: ISSUES AND ANALYSIS RESPECTING EQUALIZATION
71The Comparison NFP Statement tendered by the mother at the end of the trial is attached as Schedule “A” to this Judgment, with certain information redacted (account numbers, etc.). It is slightly different than the one that she tendered at the outset of the trial.
72Already by the start of this trial, there were only a small handful of discrepancies between the parties’ positions. By the end of the trial, these discrepancies narrowed further. What follows is my ruling on the remaining ones, not previously resolved.
A. 2019 Income Taxes that Had Accrued Between January and May 3, 2019
73The father seeks to deduct as a debt at the date of separation, a portion of the income taxes he owed in 2019, in the amount of $7,250. This sum is his tax bill for that year, pro-rated to the period between January 1, 2019 and the date of separation. The mother initially said that the father had not proven this. By the end of the trial, the mother conceded the father’s claim for this deduction.
B. Notional Disposition Costs on the Father’s Swiss Pension
74At both the outset and at the end of the trial, the father claimed a deduction for notional disposition costs on his Swiss pension at 8%, perhaps revised down to 7% at the end of the trial. Although she had listed him as one of her expert witnesses on the TSEF, the mother then decided not to call Simone De Turris to testify. The mother had retained Mr. De Turris to prepare an expert report about the father’s tax rates, prior to the SAF. This did not include disposition costs on the pension. The father nevertheless insisted that he be called, Ms. Boulby did that, he was qualified to give expert opinion evidence in Swiss tax law, and his reports went into evidence. Ms. Boulby otherwise asked few questions of him.
75When the father cross-examined Mr. De Turris, he tried to elicit evidence about these disposition costs. In the end, Mr. De Turris could only guess what the tax might be; he said maybe 7%, but he also said he would need to do actual calculations.
76This is not a proper way to call expert evidence. Expert reports are required prior to a Settlement Conference: see rule 20.2(2) of the Family Law Rules. The Court did not grant leave for the father to tender expert opinion evidence in this fashion. There was also no report. The father did not instruct an expert to prepare this calculation or to produce an expert report in advance of this trial, as he should have. Ms. Boulby had not instructed Mr. De Turris to calculate notional disposition costs.
77So while there was some evidence that the father will incur some tax when the pension is collapsed, the actual amount of deduction was not proven during the trial, and the rules to do so were not followed. The deduction is disallowed: see also Delongte v. Delongte, 2024 ONSC 3454 ¶ 16, 17.
C. The Paternal Grandfather’s 2009 Advance to the Father, to Fund his MBA
78That leaves the funds advanced for the MBA. The precise issue that the Court has to decide, is whether those funds were a gift or a loan.
(1) Applicable Legal Principles
79This dispute engages the presumption of resulting trust. The presumption of resulting trust is a rebuttable presumption and a general rule that applies to gratuitous transfers. Where the transfer is challenged, the presumption allocates the legal burden of proof and places the onus on the transferee to demonstrate that a gift was intended: see Pecore v. Pecore, 2007 SCC 17 ¶ 4, 42-44, 55, 56.
80Yet here, the father and the grandfather are aligned. They both assert that the transfer was not gratuitous, but rather a loan. The father argues that he had to pay his father back, and he did in fact repay it after the separation.
81As I have already said, the mother’s evidence to counter this consists in part of what her belief is. She nevertheless gave some evidence about an alleged discussion the parties had at the time of the advance. More importantly, she has challenged the veracity of the documentation that exists, she points to the absence of certain documentation, and she points to inconsistencies arising in the evidence that the father called about the advance. These are proper considerations to deciding the issue before the Court: see Pecore v. Pecore ¶ 44; see also Barber v. Magee, 2015 ONSC 8054 ¶ 44, 47, 73, aff’d by 2017 ONCA 558.
82To decide the issue, the Court is to start the inquiry with the applicable presumption. It is to weigh all of the evidence in an attempt to ascertain on a balance of probabilities, the transferor’s actual intention at the time of the transfer. The presumption will only determine the result where there is insufficient evidence to rebut it on a balance of probabilities: see Pecore v. Pecore ¶ 44.
83The evidence of the transferor’s intention “ought to be contemporaneous, or nearly so” to the time of the transfer. The Court can rely on evidence that arises subsequent to the transfer, to the extent that it is relevant to the transferor’s intention at the time of the transfer. However the reliability of that evidence, and the weight to attach to it, must be assessed “guarding against evidence that is self-serving or that tends to reflect a change in intention”: see Pecore v. Pecore ¶ 50, 56-70; see also Bradshaw v. Hougassian, 2024 ONCA 425 ¶ 11, 12.
84At ¶ 42 of Barber v. Magee, 2015 ONSC 8054, Fitzpatrick J., after citing certain other cases, provided a list of factors to consider when determining whether a gift or a loan was intended, which I will apply. These included:
(a) the presence or absence of contemporaneous documents evidencing a loan;
(b) whether the manner for repayment was specified;
(c) whether there was security held for the loan;
(d) whether there were advances to one child and not others or advances on equal amounts to various children;
(e) whether there had been any demand for payment before the separation;
(f) whether there had been any partial repayment; and
(g) whether there was an expectation or likelihood of repayment.
(2) Analysis
85It is not disputed that about two or three years into the marriage, the father began studying towards an MBA on a part-time basis over two years. He did so in Switzerland, through a satellite program of the University of Strathclyde in the United Kingdom.
86The father says that he was not in a position to pay for this program himself. He says he borrowed 62,000 CHF from his father: see ¶ 111 of his trial affidavit sworn May 6, 2024. Also in his trial affidavit, the father says that he was not able to save the money required to pay back his father for several years. Orally he explained that the funds did not come to him directly from his father, but were transferred to him via his brother’s bank account in Dubai.
87The father tendered an “Acknowledgement of Debt” document that he says he prepared himself at the time of the transfer. He says it was signed on January 15, and 19, 2009, by both himself first, and then by his father.
88The father says he signed this document in the presence of a lawyer in Lebanon, named Hani Sleiman. He did not do so in person; video conference technology was used. He says he scanned the document to Mr. Sleiman. The father says that the paternal grandfather then signed it in Mr. Sleiman’s presence, on January 19, 2009.
89The “Acknowledgement of Debt” document says that the advance was for 62,000 CHF. This sum was to be interest free for 10 years, and then 2% interest would be applied. The document is silent as to how the interest was to be calculated, although both the father and then the grandfather claimed this was to be an annual accrual. In any event, the full amount of the debt, plus any interest, was said to have to be repaid in full by January 31, 2020. In other words, the ultimate repayment date was by the 11th year.
90The father tendered affidavits from the paternal grandfather and Mr. Sleiman, both sworn May 4, 2024, to corroborate his characterization of the advance. They each testified and were cross-examined as well.
91The paternal grandfather confirmed that the father asked for the funds. He said the father promised to repay him “in about 10 years’ time in a few lump sums”. He said they agreed to the amount of 62,000 CHF. He said that he contacted Mr. Sleiman “at the beginning of January 2009 to arrange for his services as a lawyer to witness the signing of the acknowledgement of debt between Ramzy and [himself].” He confirmed the father’s evidence about how the document was signed, and that the funds came through his other son’s bank account. He said he specifically instructed the father to pay him back in large lump sums, “because [he] did not want to track multiple small payments,” something that was not in the “Acknowledgement of Debt” document, but rather came out in the oral testimony.
92Mr. Sleiman said in his trial affidavit, that he knew the paternal grandfather through mutual acquaintances. In fact, the father also said that his father selected Mr. Sleiman, because they knew each other (whereas the father did not know any lawyers in Switzerland). The father said this way was “cheaper and quicker” to organize.
93Consistent with the father’s evidence, Mr. Sleiman said that the grandfather contacted him in early January 2009 to witness the document, that the father contacted him to set up a video conference, that he witnessed the father signing the document first over video that the father then scanned the document to him, not by email but over some kind of video conference file sharing, and that the grandfather came in to sign on January 19, 2009. Mr. Sleiman said the grandfather signed the documents in his presence.
94While the mother believes that the father is now claiming this advance to be a loan, to reduce his equalization payment, she also says in her trial affidavit, that the father in the past told her, that the paternal grandfather “offered to pay his university fees for this degree as a gift to him”. It was only after the separation that the father alleged, for the first time, that his father had loaned the money and produced the loan agreement, contrary to what he had previously claimed during the marriage.
95The father chose not to refute this account of an alleged conversation head on. Rather he put argument in his affidavit. He says that the mother assumed that the advance was a gift, and even if he had “told her it was a loan, she would have objected and said it should be a gift”. He could have, but did not, specifically deny that the conversation ever happened. Even had he squarely denied it, he did not in his argument explain why that mother would have claimed the advance should be a gift had he said otherwise at the time, when they were still married. Why would this have mattered to the mother?
96Regardless, I do not decide the issue based on the apparently competing accounts of a prior conversation between the parents. I am left questioning the credibility of the evidence that the father called, particularly about whether the “Acknowledgement of Debt” document was contemporaneously created, and consequently about whether the grandfather’s intention at the time of the transferor was actually to loan funds to his son.
97First of all, there are some discrepancies between the father’s and grandfather’s evidence, and the actual documents. The bank statement relating to the advance (Ex 13) reveals that only 61,700 CHF was transferred on January 21, 2009, not 62,000 CHF.6 Were that the extent of it, I would not deny the father the deduction over this minor discrepancy. However, the father provided bank documents (Ex 14 and 15) showing that he then made two payments to pay off the alleged loan after the date of separation, of 30,000 CHF on August 8, 2019 and of 32,000 CHF on December 1, 2021. The amount repaid was 62,000 CHF, not the 61,700 CHF advanced. While the overage on the repayment is the minor amount (the 300 CHF discrepancy), the second payment made allegedly to clear up this debt, post-dates the ultimate due date in the “Acknowledgement of Debt document” by almost another year. The father did not comply with timing required for ultimate repayment set out in the “Acknowledgement of Debt document” that he produced.
98Because it was not paid back in full after 10 years, there was supposed to be interest. But the grandfather was disinterested in the interest, as expressed during his testimony at trial. When asked about it, the grandfather claimed the intention was for him to get the principal paid back, but the father must have put interest into the document because he lives in Switzerland. He went on to explain that the 2% interest rate must have been chosen because the funds used to give the advance were in CHF. For example, he claimed had there been a different currency used to advance the funds, then the interest rate would have differed. To say the least, the grandfather was less than confident about his intention, when explaining the interest clause.
99It might have been far easier to accept the accounts I heard, had the father and the grandfather just said that the “Acknowledgement of Debt” document contained a rounded rather than a precise amount of the advance that otherwise approximated the quantum of the actual advance, and that is what he repaid. But both went on to tell the Court a story about the reason why 300 CHF more was reflected as loaned and owing in the “Acknowledgement of Debt” document versus what was advanced, and why 300CHF more was repaid after the separation. There was a mid-trial attempt to characterize that additional 300 CHF amount as a part payment of the 2% interest required by the document. This was so even though theoretically the 300 CHF amount might have never been owing at all, had the principal been repaid before 10 years, and even though the grandfather testified that he did not necessarily intend there to be interest at all.
100And given the timing of the ultimate repayment, (after the 11th year/ the ultimate repayment date) the interest owing at 2%, would have been more than 300 CHF. I was also told by both of them, that the father apparently provided some additional sum of cash to the grandfather at some other later point when he went to visit him in Lebanon, even though the grandfather’s affidavit said he wanted large lump sums, and even though the grandfather seemed disinterested in the interest. The father said he did this at some point in 2022. Apparently, this fact has never been asserted in this proceeding before, according to a cross-examination question of Ms. Boulby. There is of course no documentation for this cash repayment, nor was a precise calculation done to confirm the exact amount of the additional cash payment allegedly paid in person and undocumented, to correspond to the total amount of interest owing.
101In regards to the manner in which this “Acknowledgement of Debt document” was signed, Ms. Boulby suggested that it was not the norm to do legal business over video conferencing back in 2009. That was before the pandemic. The father disagreed; so did Mr. Sleiman. The Court does not know what the norm was in Lebanon or in Switzerland at the time. What the Court does know, is that while perhaps Mr. Sleiman was more adept at video conferencing back in 2009, he had great difficulty testifying by zoom at this trial, he had to have his son present to help him with the computer, his internet connection was terrible and he had difficulty hearing.7
102What strikes the Court as even more unusual, is why, given that the grandfather apparently saw fit to arrange for “legal services” from Mr. Sleiman, didn’t he just have this document prepared properly by Mr. Sleiman himself, such as by way of a promissory note or some other valid loan document used in Lebanon. A proper loan document could have been prepared by an actual lawyer, rather than having the father prepare a kitchen table document, and taking it to a lawyer, to be witnessed only. For that matter, anyone could have witnessed the document, if the grandfather and the father really thought that the document needed to be witnessed for some reason. Why was a lawyer required for this?
103In regards to who actually prepared the document, the evidence was also conflicting. Again, the father claimed to have drafted the document. Mr. Sleiman then claimed that he must have prepared the document in Arabic, and the father just translated it into English. Not only is this not what the father had testified, but if that is true, the Court is left wondering why the document needed to be translated into English, given that all parties and Mr. Sleiman speak Arabic.
104Furthermore, when preparing his Swiss tax returns, the father is required to declare the worldwide debts he owes on it. The father failed to include this sum as a debt on any of his tax returns. When confronted with this in cross-examination, he said it slipped his mind. He also tried to blame the person who prepared his tax returns for the omission.
105Finally, there is a history of generosity from the paternal grandfather to the father. For example the paternal grandfather paid for the parties’ wedding, apparently to the tune of 60,000 CHF. He also gifted the father a Mercedes, when J. was born.
D. Conclusions Respecting the Paternal Grandfather’s 2009 Advance to the Father, to Fund his MBA
106In conclusion:
(a) The Court is unable to find that the “Acknowledgement of Debt” document was a contemporaneous document evidencing the loan;
(b) There is conflicting evidence about who drafted the document;
(c) There is no email confirming the document that the father claimed to have drafted was scanned and sent to Mr. Sleiman, because the document was supposedly sent using the video conferencing technology, for which no record of transmission was tendered;
(d) While there are some terms respecting the manner of repayment in the “Acknowledgement of Debt” document, there is no mention that the grandfather only wanted to be paid in large amounts, so as to not have to track small payments. This subsequent evidence emerged in the oral and affidavit evidence at this trial;
(e) There are inconsistencies between the “Acknowledgement of Debt” document and what happened in reality. The father and the paternal grandfather did not follow its terms;
(f) The explanation about the interest paid did not make sense, and some of it was not documented;
(g) There was no evidence of any demands for repayment prior to the separation, and there were no partial repayments;
(h) There was no security for the loan;
(i) The father did not report the advance as a loan on his Swiss tax returns; and
(j) The grandfather had previously been generous with the father.
107The Court finds on a balance of probabilities, that the advance was recast as a loan after the date of separation, a repayment was then made and a document produced, to corroborate this version of events, to reduce the father’s net family property and the equalization payment owing. The Court finds that the grandfather intended to gift the funds. The Court denies the father the deduction he claimed as a loan for the MBA.
E. Equalization Payment and Prejudgment Interest
108The equalization payment that the father owes to the mother is $86,932.92, as set out in the Applicant’s Position on the Comparison Net Family Property Statement at Schedule “A” to this Judgment.
109The father also owes prejudgment interest of $9,226.73 on this amount (i.e.. $86,932.32 x 2% x 1937 days / 365 days (between May 3, 2019 and August 20, 2024)).
110No one provided me with submissions about whether there should be interest on the credits for post-separation amounts mentioned earlier, to be deducted from the prejudgment interest on the equalization payment. No one provided me with calculations either.
PART IX: ISSUES AND ANALYSIS RESPECTING THE DETERMIANTION OF INCOMES, ENTITLEMENT TO SPOUSAL SUPPORT, RETROACTIVITY AND DURATION
A. The Statutory Factors Respecting Spousal Support
111Pursuant to section 15.2(4) of the Divorce Act, in considering making a spousal support order, the Court shall take into consideration the condition, means, needs and other circumstances of each spouse, including:
(a) the length of time the spouses cohabited;
(b) the functions performed by each spouse during cohabitation; and
(c) any order, agreement or arrangement relating to the support of either spouse.
112“The condition, means, needs and other circumstances of each spouse” is a mandatory consideration in a spousal support case. The father’s arguments about the mother’s “condition, means, needs and other circumstances” revolved heavily around his request that the Court impute an income of $60,000.00 to her.8
B. Applicable Legal Principles Concerning the Imputation of Income In Cases of Intentional Under- or Unemployment
113The starting point for the determination of income under the SSAGs is the definition of “income” under the Guidelines: see for example the SSAGs Revised User’s Guide: April 2016, page 18; see also sections 15 to 20 of the Guidelines generally.9
114I do not really need to address sections 15, 16, 17, 18, or 20 of the Guidelines as they pertain to the mother. They are mostly straightforward, or do not apply.
115The father’s imputing argument specifically engages section 19(1)(a) of the Guidelines. It provides that the Court may impute an amount of income to a spouse that it considers “appropriate in the circumstances”, including “(a) 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”.
116The legal principles respecting imputing income under section 19(1)(a) are set out in cases like Drygala v. Pauli, 2002 CanLii 41868, Tillmans v. Tillmans, 2014 ONSC 6773, and Homsi, v. Zaya, 2009 ONCA 311. The principles are well known. I find I do not need to summarize these any further either, but I will apply them.
C. Analysis Respecting the Determination of the Mother’s Incomes
(1) The Mother’s Background and the Circumstances of this Marriage
117The mother is currently 46 years old. Although she is a Canadian and Lebanese citizen, she does not have ties to Lebanon. Except for when she lived in Switzerland during the marriage, the mother has otherwise lived with her family in Markham, since 1986.
118The mother has a Bachelor of Fine Arts Cultural Studies degree from York University, that she obtained prior to the marriage. After she graduated, she worked in marketing for an IT company for a time.
119The mother moved to Switzerland to be with the father upon the marriage. She has not worked outside the home since the marriage in 2006. That is 18 years ago.
120Once in Switzerland, the mother did not speak any of the Swiss languages. While she says she tried to study German, she says the father asked her to quit the lessons because of the cost. In fact, the mother says the parties also agreed that she would not work, and would instead focus on raising the family while the father worked on his career.
121The father disputes this. He says that there was never such an agreement. He says they did not have children until a few years into the marriage; the mother refused to work.
122The mother moved back to Ontario with the children in July of 2016, because she felt isolated in Switzerland, she wanted to be closer to her family, and she wanted the children to be educated here. The mother says she was only supposed to move in with her parents, until the father came here too. She says that the father promised to look for work here in Canada, but never followed through. Instead, he went ahead and obtained Swiss citizenship without her knowledge.
123The father has a different perspective. Ultimately he found that he could not make as much money as he was earning in Switzerland.
124Although the father came to visit from time to time, he did not relocate to Canada. The parties then separated. This arrangement of the mother and the children living with her parents became more permanent.
125To the extent there is a factual dispute about the reasons the mother did not work, what happened prior to her return to Ontario, the extent of the parties’ discussions, and why the father didn’t move to Canada, the resolution of these factual disputes does not drive the result. The fact of the matter is that the mother has been out of the work force for a long period of time, her education is out of date, and most significantly, section 19(1)(a) makes an exception to imputing where the “unemployment is required by the needs of a child of the marriage”.
(2) The Mother is Unemployed Because of Her Child Care Responsibilities
126Indeed, this not a case of a mother who is choosing not to work in favour of collecting support by choice. Her ability to obtain employment now, is very much impacted by the ongoing needs of the children, particularly V. The father’s choice not to exercise any parenting time at all going forward further compounds the adverse financial circumstances in which the mother finds herself.
127There are a number of details in the mother’s trial affidavit about V.’s circumstances, and her needs, that frankly are dispositive of this particular issue about imputing. For example, the mother has to be with V. most of the time. V. has difficulty controlling her emotions and exhibits poor behaviour, whenever there are changes to her routine that cause sensory overload. V. has been in intensive therapy since her diagnosis. She requires both speech and behavioural management therapy. Because of the length of wait lists in Ontario, services are being provided on a private basis.
128V. has had six therapy sessions each week through Speech Inc. On week days, these are 1.5 hours long, and on Saturdays these are 1 hour long. While V. has had a number of professionals involved in her care, the mother only called Linda Thai, a communicative disorders assistant and psychotherapist, who provides both speech and behavioural therapy management to V., to testify. That, along with the mother’s own evidence, was sufficient.
129The Court allowed Ms. Thai to testify as a participant expert to give evidence with respect to V.’s treatment and needs regarding speech therapy and emotional and behavioural regulation, within the meaning of rule 20.2(1) of the Family Law Rules. Ms. Thai’s evidence included a written summary (in the form of a letter) and oral evidence.
130In her letter of April 2, 2024, Ms. Thai explained the frequency of her work with V. She explained that V. had made “significant progress” in terms of her speech and language, and improvements in her behavioural and emotional regulation. However the extent of this improvement is described in terms of her ability to make certain sounds more clearly. She still needs ongoing support to improve her clarity of speech. V.’s emotional and behavioural improvement includes her ability to ask for breaks, which she was taught to do, in 2024 only. She still requires support to stay seated to complete tasks when working. She needs verbal, visual and auditory reminders, and benefits from reduced distractions from both the clinician and her mother. Her language improvement is still only at the level where she can use more words in a sentence, for example increasing from one-word, to seven-word sentences. She can ask to use the bathroom, and share her feelings.
131The mother has also observed improvements. For example, the mother too, cited the fact that V. used to be non-verbal and gave one-word answers to questions, but she now makes “seven-word sentences”. While V.’s emotional regulation has improved since the start of therapy, according to the mother, V. still hits, scratches, bites and punches, both the mother, her brother, and herself, when she experiences frustration. V. still has overwhelming feelings of dysregulation or restlessness when she is not able to effectively communicate or express her needs or wants.
132Therefore, I find that while there have been positive developments, one must be careful not to misinterpret Ms. Thai’s use of the words “significant progress” in her April 2, 2024 letter. “Significant progress” is a comparator term, that must be measured from where V. started.
133The evidence as a whole reveals that V. was very delayed. There is still more work to do. For example Ms. Thai explained that she is now working on helping V. express her feelings using words as opposed to emotional reactions. She would also like to see V. be able to tell a story on her own. While she is now able to formulate some sentences, her sentences are still choppy, and she cannot formulate an entire paragraph. Sometimes her grammar is incorrect, and sometimes what she says doesn’t make sense.
134V. continues to attend virtually through a school of virtual learning with the Toronto Catholic District School Board. V. has an Individual Education Plan. Virtual learning has allowed for the accommodation of V.’s needs. She receives one to one academic support, care and attention, and it also accommodates her intensive daily speech and behavioural therapy, with minimal transitions. While the school day normally runs from 8:30 AM to 3 PM, V. attends six days each week instead; her class schedule is adjusted to accommodate her therapy schedule. This would not happen in a regular setting.
135The mother is actively involved in V.’s schooling and therapies. For example, the mother sits by V.’s side constantly while she is attending virtual school, to help her stay focused and seated, to help manage her emotions and speech, and to help guide her from one subject or task to the next. Aside from that, V. requires constant vigilance, support and supervision in respect of all her daily needs. Ms. Thai confirmed that the mother plays a large role in helping her to do her work with V. For example, she too confirmed that the mother ensures that V. is able to stay focused during their work together. She helps her use language, such as by using verbal prompting, and modelling, during Ms. Thai’s sessions.
136Regarding J., he is in grade 6 at the same virtual school. The mother describes J. as an exceptionally bright child, who is thriving academically, she says because of the rich academic content of this school. The mother says that when he attended the local elementary school before, he complained, which the mother attributed to J. being ahead of the pace in the traditional school program. While the mother devotes much time to V., she also works with J. in the evenings, on his school-work.
137The father’s cross-examinations, including that of Ms. Thai, focused in part on suggesting that the children should return to school in person, and that V. in particular should have more in person socialization in different settings, or at least, that this should be tried. Ms. Thai did not opine that this might work for V. What she clearly maintained though, is that the current format for her therapy serves her well. She also expressed concern about V. being overstimulated in a school setting, and having setbacks.
138Incidentally, that is not an issue before the Court, insofar as the decision to implement one form of education or therapy over another is concerned. Decision-making responsibility is resolved, on consent. I suppose a court could say, in spite of that, that the mother’s exercise of her decision-making responsibility is not reasonable. While the choice of school would still be ultimately up to the mother, it could say the father should not bear the financial consequences of that choice. But the Court will not do so in a case of this nature, because the evidence does not support such a finding.
139In addition to the fact that the mother has the legal authority to make this decision, the evidence called at trial supports the wisdom of her decision respecting the manner in which she is parenting these children, including her educational and therapeutic choices for them.
(3) The Mother’s Financial and Other Circumstances
140The mother says she has no income other than child and spousal support, and a small amount of investment income. Her tax returns for 2019 to 2023 reveal this. That other income ranges between a low of about $1,500 and a high of about $4,100.00 in these years. Neither the mother (nor the father’s expert) included these amounts as income to the mother in their support calculations. While these do not have a great impact in the end result, I find they should have been included. The specific amounts in each year are included in the Court’s calculations. For 2024, I have included the same amounts from 2023, as an estimate. To be clear, with or without these adjustments, the mother’s other income is still minimal and she needs support. She clearly relies on child and spousal support to make ends meet.
141The mother did not mention, or include in her DivorceMate calculations, that between 2020 and 2023, she deducted legal fees on her taxes, incurred in connection with this case.10 In part because of this, the mother paid no tax in 3 of the 4 years, and almost no tax in the other year.
142Now, the mother did not seek to deduct these legal fees as Schedule III deductions in the determination of her income, which would have the effect of reducing her contribution towards section 7 expenses and increasing spousal support, in the software’s calculations. There is conflicting case law about whether legal fees are Schedule III deductions from Guidelines income. One line of cases says that they are, subject to possibly being added back under section 19(1) of the Guidelines.11 Another line of cases, including one previously authored by this Court,12 does not provide for a Schedule III adjustment, and hence no need to consider any imputing. However the deduction of legal fees, when input into DivorceMate, still reduces ones taxes, increases cash flow and consequently reduces the spousal support that the “With Child Support” Formula of the SSAGs would otherwise calculate.
143Following the development of this divergence in the case law, DivorceMate now contains two different input boxes for these expenses, depending on which approach is taken. As she did not seek to deduct her legal fees as a Schedule III deduction, there was no argument about the propriety of this, and therefore no need for me to consider this, or whether to impute the deduction back, any further. While it was her choice not to seek a Guidelines income deduction under Schedule III, at a minimum, her calculations ought to have inputted the deduction as an input in DivorceMate under “Carrying charges not impacting Guidelines income”, to ensure that the “With Child Support” Formula calculation was accurate. In this Court’s calculations, the fees for 2020 through 2023 are treated in that fashion.
144I imagine there will be further legal fees deducted for 2024 given that this case continued in 2024, and went to trial, but I do not yet know what they are. Beyond that, these should end. Therefore, I do not make any further adjustment for this in the 2024 calculations. In any event, it would not be appropriate to have such a deduction for the purposes of going forward support after 2024, when legal fees will not be incurred any more.
145Otherwise in regards to her financial circumstances, the mother and the children live with her parents. Since the mother started to receive support, she now contributes $2,000.00 per month towards the expenses associated with living in her parents’ home. She would like to live on her own at some point. In cross-examination, she testified that she didn’t pay these $2,000.00 monthly sums initially, because she couldn’t afford to pay for legal fees. The father claimed this was a disclosure issue on the part of both the mother and her parents, but during Ms. Boulby’s cross-examination of him, it was revealed that the mother had previously produced her bank statements showing these payments. The complaint remained that there ought to have been disclosure of her parents’ circumstances.
D. Analysis Respecting the Specific Factors in Section 15.2(4) of the Divorce Act As They Pertain to the Mother
146The analysis respecting the specific factors in section 15.2(4) as they pertain to the mother is straightforward.
(1) Section 15.2(4)(a): the Length of Cohabitation
147The marriage was 12 years and 4 months long. While duration is dealt with later on in the Court’s analysis and calculations, and although this was more of a medium length marriage as opposed to a longer term one, when considered alongside the other factors and evidence that I have highlighted, there have been clear economic advantages to the father, and disadvantages to the mother.
(2) Section 15.2(4)(b): the Functions Performed by Each Spouse During Cohabitation
148The mother stayed at home and cared for the children. This enabled the father to work and to continue to build his career during the marriage and post-separation. He was also able to further his education and increase his income, as a result of the parties’ arrangement.
(3) Section 15.2(4)(c)
149There is no order, agreement or arrangement relating to the support of either spouse.
E. Findings and Conclusions Respecting the Statutory Factors in Section 15.2(4) of the Divorce Act and the Determination of the Mother’s Incomes
150I find there is no merit to the father’s argument that income should be imputed to the mother. The circumstances of this marriage had an economic impact on both spouses. The mother relocated to Switzerland where she did not speak the languages. She then cared for the children, one of whom now has a high degree of special needs. She continues to do so. Quite apart from the fact that the mother has been out of the workforce for a number of years and the fact that the father did not prove any ability on her part to just start earning $60,000.00 (whether immediately or after a 6 month grace period from the date of separation as he argued), the Court finds the father’s position, that the mother should just send these children to in person school, or delegate the care of these children to the grandparents, or V.’s care to J. at some point in the near future, or some combination thereof, coupled with his own choice not to travel to Ontario and participate in the parenting, is advanced with a certain amount of audacity.
151The father’s position, that income should be imputed to the mother, is completely unreasonable in these circumstances. It is insensitive and harsh, in view of his children’s needs. It shows a significant lack of insight on his part. The evidence about V.’s needs and how the mother is meeting them, was unshaken at this trial. The father did not even obtain any significant admissions in cross-examination, that her parents are helping her in a material way with her parenting responsibilities.
152And in regards to the father’s argument, that the mother has not produced disclosure respecting her parents’ circumstances, while the failure to produce disclosure can be a basis to impute, for example under section 19(1) (f), I do not find this to be so in this case. The mother thought her return to live with her parents was temporary; that turned out not to be so. It is not unreasonable for the mother to be contributing towards the household expenses until she gets a place of her own, now that she receives support. Incidentally, this non-disclosure (to the extent it even counts as non-disclosure13), is not in any way on the same footing as the father’s own failure to disclose his new spouse’s income. This is not a quid pro quo situation.
153In stark contrast, the father’s failure to produce relevant financial information about his new relationship, is far more significant, especially after he squarely placed the cost of living and Swiss tax rates into issue, as reasons militating against a spousal support Order. Obviously, the father’s new spouse’s income, the extent to which they are sharing expenses, and the impact of his new spouse’s income on his tax rates are relevant to assessing the very arguments that he raised. These facts are also important when it comes to the correct calculation of support.
F. The Father’s “Condition, Means, Needs and Other Circumstances”
154In my view, the real issues in this case concern the father’s circumstances.
(1) The Components of the Father’s Current Income
155The father’s income consists of base pay, and quarterly bonuses, if he is eligible for them. According to ¶ 102 and 103 of the SAF, the father’s base salary is 180,000 CHF since March 2022, and in addition, he is “entitled to a variable compensation package worth a targeted 25% of his annual base salary, as well as stock ownership”. The SAF does not say whether the father is entitled to ongoing grants of stock. But according to ¶ 82 of the father’s trial affidavit sworn May 6, 2024, the father’s annual salary is now even higher. It now sits 186,300 CHF, which he converts to $281,313.00 CAD using an exchange rate of 1.51. This is exclusive of his bonuses and other compensation.14
156On his financial statement sworn May 6, 2024, the father then said his total 2023 income was actually 270,618 CHF, which he converted to $406,576 CAD, this time using an exchange rate of 1.5024. He also repeated this total income in CHF on a spreadsheet that he supplied for his closing submissions, although in it, he made cash flow calculations and arguments using his base salary only, to the tune of several thousands of dollars less each month.
(2) Exchange Rates
157The father has been paid in Swiss Francs throughout this marriage, and post-separation. Although there have been fluctuating exchange rates in the past, a Swiss Franc is currently worth about 50% more when expressed in Canadian currency. The parties advised the Court that the current exchange rate is that 1 CHF sits at about 1.5 CAD. And most of the agreed upon exchange rates required for the purposes of the analysis under section 20 of the Guidelines, are set out in the SAF.
(3) The Methodology Underlying the Parties’ Agreements About the Father’s Guidelines Incomes Between 2019 and 2022 in the SAF
158As I have already set out verbatim, the parties’ ultimate agreement respecting the father’s incomes for 2019 to 2022, is memorialized in ¶155 of the SAF, but the methodologies used to get there are not in the SAF. I would have thought, based the SAF and the father’s statement in his trial affidavit (subject only to this cost of living argument), that in accordance with the usual manner in which income is determined under the Guidelines, the father’s Swiss franc income had been converted into Canadian dollars, perhaps some other adjustments had to be made to account for different deductions in Switzerland as compared to those in Canada, and then that income was grossed up to account for the lower tax rates in Switzerland, so as to put the father in the same position as an Ontario employee/payor. However when I asked certain questions about the source of the figures in the SAF, Ms. Boulby said told the Court that a compromise had been reached.
159The mother did not call her valuator, Mr. Ranot to testify, even though he prepared some of the analysis that turned into ¶ 155. It would have been helpful to have been given some clarity about the methodology underlying the numbers in ¶155, in view of the manner in which spousal support is then determined when using the SSAGs, the inaccuracies in the mother’s DivorceMate calculations, and the fact that the Court had to do its own calculations.
160Regardless, while there might have been some compromise, and except for the cost of living deduction in ¶ 155(a), I infer that ¶ 155 of the SAF generally follows the methodology in the Guidelines for the determination of incomes, because:
(a) This is a typical approach to the determination of income. If the mother intends the Guidelines and then the SSAGs to apply (which she does), then it is reasonable to assume that the approach to the determination of income that is required by those, was followed;
(b) Many paragraphs in the SAF seem to have been quite deliberately included. They are facts needed to calculate income using this typical approach;
(c) For example, at ¶ 90 of the SAF, the parties agree that the father’s “…income tax rate in Switzerland is considerably lower than the equivalent Canadian income tax rate based on his income year-over-year in Switzerland”. This is consistent with the language in section 19(1)(c) of the Guidelines. Such a finding would be required, for there to be a gross up under that section;
(d) Paragraphs 91 to 95 of the SAF set out the Bank Canada’s average annual exchange rates to convert CHF into CAD between 2018 and 2022. This is consistent with the case law that interprets section 20(1) of the Guidelines;
(e) Paragraphs 104 to 110 of the SAF, and paragraphs 117 to 120, set out the father’s incomes between 2018 and 2021 in CHF, having regard to certain adjustments in Switzerland. This is consistent with what is required to determine incomes;
(f) Paragraphs 121 to 124 of the SAF convert the incomes in paragraphs 117 to 120 (i.e.. his gross incomes inclusive of state pension contributions, employment insurance contributions and payments to his employer pension plan, less taxes and government withholdings akin to CPP and EI for Canadian tax payers) into CAD using the exchange rates in paragraphs 91 to 95. This is consistent with what is required to determine incomes;
(g) Paragraph 112 of the SAF states that child and spousal support payments in Switzerland are tax deductible to the support payor. Such a finding of fact would be required for the purposes of section 19(1)(c) of the Guidelines, if one of the reasons for there being “significantly lower taxes” in Switzerland stems from the fact that child support paid is deductible, as opposed to in Ontario, where it is not;
(h) Paragraphs 113 to 116 set out what the father actually deducted as support paid on his Swiss tax returns for 2018 to 2021. Such a finding of fact would also be required for the purposes of section 19(1)(c) of the Guidelines;
(i) Despite the fact that the father’s valuator, Mr. Ogilvie, accounted for the father’s cost of living argument, he also grossed up the father’s income to arrive at a Canadian Equivalent Gross Income, as explained in paragraph 21 of his Report dated September 18, 2023;
(j) According to his Report, Mr. Ogilvie relied upon one of Mr. Ranot’s Reports; and
(k) At ¶ 64 to 66 of his trial affidavit, the father himself says that his income was grossed up, because of the lower tax rates in Switzerland. He says that it was Mr. Ranot, not Mr. Ogilvie, who calculated a gross up15 and that “on application of the formula set out in the FCSG, my income for the purposes of guideline child support is accurately valued in Mr. Ranot’s Report”.
(4) The Father’s Guidelines Incomes for 2019 to 2023
161In light of the father’s latter statement in ¶ 66 of his trial affidavit, the resolution of which scenario in ¶ 155 of the SAF the Court should select for the father’s incomes, and the resolution of retroactivity, at least for table child support, becomes easy. Not much by way further analysis is required.
162Paragraph 155(b) of the SAF sets out the father’s Guidelines incomes for 2019 to 2022. The determination of the father’s income for the purposes of ongoing child support is already dealt with in MacPherson J.’s Order of June 3, 2024 (i.e.. $600,000.00).
163Although 2023 is not dealt with in the SAF and it would have been helpful to have Mr. Ranot’s evidence and reports before the Court for prior years to see if the Court could extrapolate something from it, it is ultimately the father’s obligation to determine his income; not the mother’s. In the end, all the Court was given in terms of expert evidence, was Mr. Ogilvie’s calculations of the father’s Individual Net Disposable Income (“INDI”) for 2023, in a supplementary schedule, and even then, Mr. Ogilvie deducted a cost of living factor. This is not the father’s Guidelines (grossed up) income for child support. Therefore, in the absence of an appropriate submission from the father for child support for 2023, and in view of his withholding of some of the information from his 2023 tax return, I intend to adopt the mother’s position for 2023. That means I will use the same $600,000.00 income for 2023, and for the first 5 months of 2024 until the commencement date in MacPherson J.’s Order, as was used in that Order for the purposes of prospective child support commencing in June of 2024. When referring to the withholding of information from the 2023 tax return and in otherwise taking this approach, I rely on section 19(1)(f) of the Guidelines.
164But because at ¶ 67 and 68 of his trial affidavit, the father says that he does not agree to use this grossed up income for spousal support, or for section 7 expenses, on account of the higher cost of living in Switzerland, I go on to analyze these arguments below. I also address his other, more valid argument, that the Court should consider his financial position after any Order of this Court, and what he can actually afford to pay, after child support.
(5) Whether It is Appropriate to Consider the Cost of Living Between Zurich and Toronto in the Determination of the Father’s Income
165The Court agrees with the mother, that there is no basis in law, for a downward adjustment to the father’s Guidelines incomes, to account for a higher cost of living in Switzerland. This issue was settled almost two decades ago, in McGouran v. Connelly, 2006 CanLII 7668 (ON CA), [2006] O.J. No 993 (C.A.).16
166At ¶ 22 to 30 of that decision, the Ontario Court of Appeal upheld the decision of a trial judge, not to determine income in this fashion, for a number of reasons. Specifically:
(a) Trial courts across Canada have interpreted section 20 of the Guidelines in the same way;
(b) Section 19 of the Guidelines empowers the Court to impute additional income to a spouse; it does not allow the Court to impute a reduced income in the same way;
(c) Section 19(1)(c) pertains to non-resident spouses. It provides for imputing income where effective tax rates are significantly lower than those in Canada. It says nothing about cost of living;
(d) In fact, nowhere do the Guidelines say that a higher cost of living is a factor to consider;17;
(e) As a matter of statutory interpretation, the omission of cost of living suggests that it was not intended that any such adjustment be made;
(f) The table amounts to not even take intra-provincial or inter-provincial discrepancies in the cost of living into account when a payor lives in another city within a province or in another province. It makes sense, that section 20, which deals with payor spouses who live outside Canada, be interpreted in a consistent manner; and
(g) There would be the need for extensive evidence in each case, if courts were to begin to recognize and adjust for discrepancies in the cost of living just to calculate income. The exercise would become “cumbersome, expensive and potentially unworkable”.
(6) Whether there is Some Other Discretion to Consider Cost of Living in the Analysis
167The Ontario Court of Appeal left open the possibility that the Court might consider cost of living in an undue hardship case. That is not what was before me.
168To the extent that one might extend that to any support case where there is some discretion, for example when considering the father’s “means, needs and other circumstances” under section 15.2(4) of the Divorce Act, or perhaps when considering the father’s “means” under section 7 of the Guidelines as the father argued, the father did not prove the underlying facts required for the Court to embark upon this analysis.
169For example, in his trial affidavit, the father says that the cost of living in Switzerland is “notoriously high”. He talks about the pace of inflation. He also talks about various expenses that he incurs in Switzerland. He says that even though his taxes are lower (upon which fact the gross up was already based), these other higher costs that he incurs offset the lower tax rates. He also said at this trial, that his tax rates will now be higher going forward because of his re-marriage.
170The father obtained from a different valuator with a different firm (whom he did not call to testify), select cost of living reports and indices for Zurich and Toronto, purchased from the consulting company Mercer LLC. He then gave these to Mr. Ogilvie and instructed him to take these into account in preparing his analysis. He also sought to file these reports and indices as exhibits at this trial. The father says that this data is “trusted by governments as well as large multinational enterprises that use the reports to quantify salaries and benefits for employees in different global labour markets based on this objective data”.
171Many of these statements are the subject of the mother’s objections, raised in both her motion to strike portions of the father’s trial affidavit, and at other times during this trial.
172There are a number of problems with this evidence. While the father can certainly give evidence about the expenses that he incurs living in Switzerland, a great deal of the father’s other statements cannot come through him; it is the domain of an expert, as the mother quite correctly pointed out in her motion to strike. And Mr. Ogilvie’s evidence did not establish these facts, or the basis to admit the Mercer LLP documents as exhibits.
173For example, Mr. Ogilvie testified that the cost of living surveys were conducted by Mercer LLP for the purposes of establishing equivalent compensation packages for ex-pats in both private and public sectors, to help come up with competitive compensation packages when employees move abroad. Mr. Ogilvie was aware that Mercer LLP is a global professional services firm, and that as part of the consulting work they do, they provide these types of surveys to their clients. While Mr. Ogilvie generally accepted the Mercer LLP data as a reliable source to establish the cost of living factor (but also in the context of this executive compensation issue), he did not satisfy me that the documents are reliable for the purpose that confronts the Court.
174Moreover, for some reason the father selected Zurich and Toronto as the two comparator cities, and for only two of the years in issue, even though he lives in a suburb of Zurich and the mother lives in Markham. I do not know whether more focused reports exist with data for the precise locations in which the parties actually live, or what the impact is of the father having selected only two years. For example, while Mr. Ogilvie testified that he assumed a linear path between the two dates, perhaps there were fluctuations to the cost of living in the years between 2019 and 2023. It seems to me that this engages the precise problem that the Ontario Court of Appeal flagged at ¶ 29 of McGouran v. Connelly, that Toronto and Zurich may not be proper comparators, that there may be fluctuations between cities within a province (or in the case of Switzerland, as between cities or suburbs within that country) and that the “cumbersome, expensive and potentially unworkable” evidence and analysis may very well have to be more laser focused than that upon which the father supplied.
175Now at ¶ 12 of P. (L.S.). v. P. (J.R.), 2002 SKQB 27, Wilkinson J. left open the possibility for a payor like the father in this case before me, to make another of the arguments that the father now makes, that his higher costs offset his lower taxes: see ¶ 12.18 It appears this argument was one of the other reasons behind the father insisting on the mother calling Mr. De Turris. But Mr. De Turris’ reports do not address this particular issue.
176Mr. De Turris’s oral testimony did not assist the father either. He did not say that a number of the items that the father claimed to pay in Switzerland were in lieu of lower taxes. Rather he characterized many of the items to which the father referred, like highway tolls, a yearly registration fee for a car, TV and Radio fees and municipal garbage fees (which incidentally, were minor in nature and are also incurred here, if one drives on Highway 407, or orders Rogers or Bell Service, or creates more than the usual weekly or bi-weekly allotment for garbage to be removed curbside) as consumption items or services. The father’s statement that some other expenses he incurs offset the lower tax rates was not proven.
177In regards to the father’s next claim about his new tax situation (i.e.. that he will going forward have to pay more taxes because of his re-marriage), I note again, that it is already an agreed fact, that Swiss tax rates are significantly lower than in Canada, and the father’s Guidelines income for all years, including going forward, took that into account, regardless of the cost of living factor. In any event, while the father may very well incur higher taxes as a result of his re-marriage, the extent of this was not proven either. While Mr. De Turris did confirm that married couples file their taxes jointly in Switzerland, they are subject to higher rates, and tax rates vary depending on where one lives, he did not say what those rates were. In fact, he blurted out during his testimony that “no one told me that you need to have a lecture in tax…” and “I’m sitting here on an island”.19
178Mr. De Turris testified that there needs to be an individualized analysis. Neither he, nor anyone else, was instructed to calculate this. Quite to the contrary as I have said, the father redacted his 2023 tax return and omitted the very information that would have been required to consider this argument. I refer again to the timing requirements for expert reports in rule 20.2(2) of the Family Law Rules. With the benefit of hindsight, the Court queries the utility in the father having insisted on calling Mr. De Turris to testify, to answer questions about the nature of certain expenditures incurred in Switzerland, or to give general information about the Swiss tax system for married couples.
179And to the extent that there is a higher cost of living, I do not even know how it impacts this particular father. Yet again here, the responsibility for that rests with this father due to his choice to withhold information about his new spouse, her income, and their allegedly higher tax rates. Whether living in a dual income household and sharing expenses defrays any higher cost of living, the Court does not really know in any way that has been properly tested.
180Finally, the father did not need to pursue all these arguments for the purposes of section 7 expenses or spousal support or retroactivity. It is always open to the Court to consider the financial positions of the parties’ consequent upon any potential Order it is considering making, before arriving at the end result. The Court can do this based upon the parties’ financial statements, and the properly admissible evidence.
G. Analysis Respecting Entitlement to Spousal Support
181Before turning to the Court’s calculations and the father’s remaining issue, I will close out entitlement, and address duration and retroactivity, briefly. The circumstances of this case also lead me to the conclusion, that there should have been very little debate about the mother’s entitlement to spousal support, yet the father argued that no past or future spousal support should be paid for various reasons. Having already rejected his imputing argument (to the mother), I now find the mother has a strong compensatory and needs based claim for spousal support.
182In particular, pursuant to section 15.2(6), my order should:
(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;
(b) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;
(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and
(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.
183Applying those objectives (and at the risk of repeating what I have already said):
(a) The father was advantaged by the marriage, by the mother’s move to Switzerland, a country that was foreign to her, and by the parties’ choices, including the mother’s assumption of the parental responsibilities;
(b) Although he says that the family was under financial strain during the marriage due to the mother not working (and some other conduct that he attributes to her), in his trial affidavit sworn May 6, 2024, the father has detailed the progression in his income over the course of the marriage, some of which I have already alluded to;
(c) The father was able to obtain his MBA, after which his income increased. At ¶ 20, he describes that his income increased from about 100,000 CHF per year between 2005 and 2008, to the time he had his penultimate job at Pegasystems. By the year of separation, the father’s was earning 211,000 CHF, a fact which is agreed upon in ¶ 97 of the SAF;
(d) Although the father was laid off from Pegasystems on November 26, 2021, he was able to secure new employment right away, before the severance period to which he was entitled ended. His new job came with increased income;
(e) These choices that both parties made in the marriage allowed the father to work, to build his career, and further his education. He continues to be able to work and earn increased income as a result;
(f) The mother was disadvantaged by the marriage and its breakdown. The mother stayed at home during the marriage. Without spousal support, she no longer shares in the income that the father earns;
(g) The mother is solely responsible for the care of the children, even though there is a joint parental obligation. Especially given V.’s needs, this is a significant benefit to the father. He has time to go out and work, earn an income, continue his career, and enjoy his life without the same responsibilities that the mother experiences; and
(h) It is not reasonable to expect the mother to attain any measure of self-sufficiency any time soon, based on the circumstances just described.
H. Analysis Respecting Duration
184Consequently, there should also be no serious issue about duration. The SSAGs call for an indefinite spousal support order in this case subject to variation and possibly review, with a minimum duration of around 6.16 years and a maximum duration of around 12.33 years from the date of separation.
185The mother candidly admitted that she does not have a plan at the moment for her future self-sufficiency. Despite that, I nevertheless agree with the mother, that there is no ability to predict when and if the time commitments required to meet her parental responsibilities will “cease or moderate”.
186Not only is the fact that the mother cannot participate in the work force at this time dispositive of the father’s imputing argument, it is also very relevant to duration. As I just said, it is not reasonable to expect this to occur any time soon, in light of the evidence the Court heard about V.’s needs in particular. The Court does not intend to craft a support order sought by the father, whether based on imputed income to the mother or some time limited or reviewable duration, that presumes this can or will occur at some specified point.
187I have specifically considered, but have rejected ordering a review for the same reasons. There is no specific material uncertainty to review at some specified point in the future: see Leskun v. Leskun, 2006 SCC 25 ¶ 36, 37. If V.’s development progresses to the point that that is no longer so, or that is so to a lesser extent, then support may be varied under section 17 of the Divorce Act. I would imagine that a material change to the father’s income, or in the exchange rates used to determine its Canadian dollar equivalent, would also count.
I. Analysis Respecting “Prior Period” Spousal Support
188Finally, counsel for the mother has asked the Court to commence its child and spousal support Orders as of the date of separation. In so doing, she characterized the mother’s claim for past spousal support (and for prior child support too), as “prior period support” as opposed to “retroactive” support.
189The mother relies on ¶ 21-23 of MacKinnon v. MacKinnon, 2005 CanLII 13191 (ON CA), 2005 CarswellOnt 1536 (C.A.) for this proposition, where the Ontario Court of Appeal said that post-application support is not retroactive support that usually requires a more robust retroactivity analysis. Rather, absent any unusual reason arising from the factors and objectives set out in the Divorce Act, where a person requests financial disclosure in preparation for the negotiation or litigation of a support claim and then proceeds reasonable to the disposition of the claim, she is entitled to prospective support from the date of notice that a claim is being pursued.
190But in Kerr v. Baranow, 2011 SCC 10, Cromwell J. may have taken a different approach to this question, although perhaps only somewhat. At ¶ 206, he wrote that he preferred “not to venture into the semantics of the word “retroactive”, but he nevertheless relied on relevant factors that “come into play where support is sought in relation to a period predating the Order”, just as Bastarache J. did when considering prior child support in D.B.S. v. S.R.G., 2006 SCC 37.
191Cromwell J. wrote that the relevant factors are the needs of the recipient, the conduct of the payor, the reason for the delay in seeking support, and any hardship the retroactive award may occasion on the payor spouse: see ¶ 207. The Court must also be concerned about the certainty of a payor’s legal obligations; the possibility of an order that reaches back into the past makes it more difficult to plan one’s affairs, and a sizeable award may impose financial hardship. Another concern relates to placing proper incentives on an applicant to proceed with her claim promptly.
192But at ¶ 211, Cromwell J. nevertheless cited MacKinnon v. MacKinnon, for the proposition that the mother relies upon, that the “usual commencement date” is the commencement of a proceeding, absent a reason not to make the order effective as of that date. Cromwell J. said that where an order is sought from the commencement of the proceedings, this will be a significant factor in how the relevant considerations are weighed.
193While there ended up being little issue about the commencement date for child support and section 7 expenses, based on the father’s positions and his prior payments, that wasn’t so for spousal support. But there should not have been a debate. The parties separated on May 3, 2019. This preceded the commencement of the proceeding by just under two months. In other words, the mother commenced this proceeding almost immediately after the separation.
194She then prosecuted her claim with relative speed. For example, the Court observes that there was a motion brought by the end of 2019, a few months after the commencement date. Kaufman J. did not order spousal support at the time; he structured the interim award differently. The mother explains that the child support Kaufman J. ordered was based on the father’s income of $346,582.00 “without any adjustment for the low tax he pays”, and with no separate provision for section 7 expenses, “knowing that [the father] would get a tax deduction for the full amount”. But she also says that Kaufman J. ordered an above Guideline amount. In any event, the mother says that retroactive spousal support, and the correct grossed up amount of income, were left to trial. Paragraph 15 of Kaufman J.’s Order does say that retroactive spousal support was preserved.
195The Court also observes that the Covid-19 pandemic intervened. At some point, the parties each participated in a custody and access assessment. The parties each obtained expert evidence. This case was eventually called to trial in the spring of 2024. Delay is not a serious concern, under the circumstances.
196I also find that the amount that Kaufman J. ordered was too low, not in respect of child support, but in respect of section 7 expenses and spousal support. This is not because the Court made a calculation error, but because the father’s financial circumstances were not then fully known. Nor was the amount of section 7 expenses that would later be incurred.
197In the result, the mother has gone without the correct level of support while the parties dealt with the parenting issues, explored the income issues with their experts, and while they otherwise worked to get this on to trial.
198In regards to the mother’s need, according to her financial statement sworn May 3, 2024, the mother does not have a great amount of savings. The majority of her savings emanated from the settlement of a personal injury lawsuit. While she has about $41,000.00 in other accounts, she owes well over $100,000.00 to her brothers for legal and expert fees.
199The father did not save in a more liquid fashion, but he has made significant post-separation contributions to his pension. According to his Financial Statement sworn May 6, 2024, his pension accumulated (in gross dollars) by almost $400,000.00 from the date of separation. He has also enjoyed the benefit of a greater share of his income over the past four years.
200In regards to the father’s ability to pay a lump sum, that is of course a competing concern. The issue that Cromwell J. identified, that a retroactive award disturbs the certainty of one’s financial obligations, could theoretically be said to exist here. But the father’s interest in certainty is less; certainly he knew, or ought to have known, that Kaufman J.’s Order could be adjusted at trial. It specifically preserved spousal support at a time that was just a few months after the separation.
201In any event, two of the ways the Court can address the impact of a retroactive order, is to first ensure that it is correctly calculated (more specifically here, not adopt incorrect over-calculations). The Court also has discretion respecting repayment terms. But there are gaps in the evidence and the submissions, once again at this trial, in respect of this latter issue.
202At ¶ 10 of his Order dated December 18, 2019, Kaufman J. ordered the father to provide the details about how a Swiss pension is divided. If this disclosure was provided, then information about it was neither included in the SAF nor called at this trial. Despite this, I will still give the parties, and the father in particular, one more chance, to assist the Court before it completely finalizes this matter, to see if any impact of the lump sum can be better managed.
203In conclusion, I find that the mother has a valid claim for spousal support as of the date of the application. The date of separation precedes that, but because it is very close. I intend to commence spousal support as of the date of separation, also to be consistent with child support. The Court’s Order makes provision for limited additional submissions on this point on the issue of repayment.
PART X: THE CALCULATION OF CHILD SUPPORT AND SECTION 7 EXPENSES
204I turn now to the quantification of the various support claims.
A. Table Child Support
205Based on the incomes in ¶155(b) of the SAF, the Court’s income determination for 2023 and 2024, and the agreed upon level of income in the consent Order of MacPherson J. dated June 3, 2024, the father’s child support obligation from the date of separation to May 1, 2024, was:
| Year | Income | Monthly Amount | Annual Totals |
|---|---|---|---|
| 2019 | $495,000.00 | $6,217.00 | $49,736.00 (8 months only – May to December, 2019) |
| 2020 | $600,000.00 | $7,477.00 | $89,724.00 |
| 2021 | $570,000.00 | $7,117.00 | $86,124.00 |
| 2022 | $550,000.00 | $6,877.00 | $82,524.00 |
| 2023 | $600,000.00 | $7,477.00 | $89,724.00 |
| 2024 | $600,000.00 | $7,477.00 | $37,385.00 (5 months only – January to May, 2024) |
| TOTAL | $435,217.00 |
206From this amount, the father is entitled to a credit for his prior payments of child support. The mother’s chart captures the $4,000.00 per month in voluntary payments that the father paid between May and December, 2019 until the Order of Kaufman J. dated December 18, 2019 (8 months x $4,000.00 = $32,000.00). This is also agreed in ¶ 125 of the SAF.
207The mother’s chart also captures the payments of $9,436.00 that Kaufman J. ordered commencing January 1, 2020 (53 months x $9,436.00 = $500,108.00). This is also captured in part in ¶ 128, 129, and 130 of the SAF. Although the SAF says nothing about payments made in 2023 or 2024 to date, the mother’s chart agrees that the father paid during this period, too.
208However, the mother’s chart does not capture the additional payment of $8,046.00 that Kaufman J. ordered at ¶ 12 of his Order. While ¶ 127 of the SAF says that the father was ordered to pay this, it says nothing about whether it was paid or not. The mother nevertheless credited the father with this sum, in a separate document entitled “Summary of Support Arrears May 2019 – May 2024). As I did not hear any evidence that the father defaulted on the court Order and as the mother included this amount in the summary document, I intend to give him credit for this, too.
209Therefore, I find the father paid $540,154.00 in child support. On this math, he overpaid to the tune of $104,937.00.
210I will apply this as a credit to the section 7 expenses, below. The result of me doing that reveals, that it is not correct to say, that nothing is owing on account of section 7 expenses in the bottom line. V.’s therapy expenses were quite high, and even with this credit and Kaufman J.’s above Guideline and section 7 expenses order, there was a shortfall.
B. Section 7 Expenses
211As set out in the SAF, the Consent Order of MacPherson J. dated June 3, 2024, and the mother’s trial affidavit sworn May 3, 2024, and as summarized at ¶ 76, 77 and 79 of the mother’s written closing submissions, the children’s section 7 expenses are mostly health related.20 They are:
Therapy for V. 2019: $9,762.50 2020: $54,802.50 2021: $44,020.00 2022: $40,175.00 2023: $39,185.00
J.’s Counselling 2020: $2,200 2021: $1,430
Dental Expenses 2022: $254.00 2023: $489.60
Vision Expenses 2022: $772.00 2023: $532.00
212Although the Court asked questions, I heard no evidence at this trial about any tax benefits or other funds that the mother in the past received, or were available to her, to fund the expensive autism related section 7 expenses. There are no deductions related to that therefore. However, while the list above mirrors what she put in her written closing submission at ¶ 76, 77 and 79, in the mother’s Excel Spreadsheet that she submitted with her closing submissions, the section 7 expenses are inaccurate; so are the ones that she input into her DivorceMate calculations.
213For example, in the chart she says that the section 7 expenses for 2019 were $10,465.04. This appears to come from ¶ 141 of the SAF, that says the children’s therapy costs were $10,465.00. However there are no therapy costs specifically delineated for J. that year, and the parties later agreed in the consent Order of MacPherson J. that the therapy costs for V. were $9,762.50 in 2019. There are other such discrepancies.
214The above numbers, that the Court orders to be shared, total $193,622.60, whereas the mother’s chart say that the section 7 expenses amounted to $208,249.08. This is a $14,626.48 discrepancy, that the Court is correcting.
215In regards to the quantum that the Court finds the father owes, except for the going forward section 7 expenses, the apportionment for which is already fixed in MacPherson J.’s consent Order of June 3, 2024 (agreed to before spousal support was determined), the amount of his contribution is impacted by spousal support. When engaging in the cumbersome process of calculating the support issues in this case, whenever the Court made a change to spousal support to adjust for cash flow, the amount of the section 7 expenses changed.
216This happens because to calculate incomes for section 7 expenses, spousal support paid to the other spouse is deducted from the father’s income. It is included in the mother’s incomes for apportionment. There are also certain other adjustments for benefits as explained in section 3.1 of Schedule III of the Guidelines.
217I nevertheless mention this here, to make it clear, that the Court’s apportionment of section 7 expenses, is a function of both the use of the father’s incomes in ¶ 155(b) of the SAF, the Court’s determination of the mother’s incomes as required by the Guidelines, and the amount of spousal support, expressed below. In other words, spousal support has been taken into account when determining the section 7 apportionment and vice versa.
218Based on the Court’s calculations, I find the father owes the following amounts for section 7 expenses:
2019: N/A 2020: $4,052.00 per month, or $48,624.00 the year 2021: $3,155.00 per month, or $37,860.00 for the year 2022: $2,901.00 per month, or $34,812.00 for the year 2023: $2,761.00 per month, or $33,132.00 for the year
219This totals $154,428.00
220After deducting the amounts of $1,198.50 and $2,454.00 that is set out at ¶ 13 of Kaufman J.’s Order dated December 18, 2019, also contained in ¶ 137, 138 and 140 of the SAF (the former amount of which the mother’s chart and summary document did not credit the father), and the excess of $104,937.00 referred to above, the I find the father owes the mother the sum of $45,838.50 on account of retroactive section 7 expenses.
221For the reasons already expressed, the Court makes no further Order on account of section 7 expenses for the first part of 2024.
PART XI: THE CALCULATION OF SPOUSAL SUPPORT
A. The Father’s Cash Flow Argument
222Quite apart from the cost of living argument, there is a different argument that the father made about spousal support, that the Court finds does have some merit, even in spite of the evidentiary gaps in this case. At ¶ 79 of his trial affidavit, the father says that already after paying support at the current level (i.e. that under the interim order), he is left with only 35% of his “gross base salary”, from which he still has to pay taxes at a later stage, because taxes are not deducted at source. He says he can barely afford to pay for his rent, health insurance premiums, and food. By the time of his closing submissions, in an Excel spreadsheet of his own, the father revised his percentage and said he was only left with 26%. In other words, he says he cannot afford to pay more support than what is already in place, and meet his expenses.
223Although this argument, differently framed, that the Court should take into account the parties’ financial positions, is a proper one, the father’s presentation of it was misleading. The strength of this argument was weakened by the following:
(a) The father is entitled to receive quarterly bonuses, if certain metrics are met, and other compensation. He does not just receive his base salary;
(b) The father admitted that he received almost all of the quarterly bonuses since obtaining his current job;
(c) As the Court’s calculations in Schedule “C” reveal, the taxes that he pays have been in decline year over year, with the possible exception of 2023,21 as both child and spousal support are tax deductible in Switzerland. For example, by 2022, the father only paid 11,320 CHF (see Mr. Ogilvie’s Supplementary Schedule 2, Ex 24), converted to $15,428.00 CAD at an exchange rate of 1.3629 (see ¶ 95 of the SAF for the exchange rate), whereas his taxes in prior years was higher; and
(d) As the father pays more support, for example after this Court’s Order, this will pull his future taxes owing further downward, consistently with the trend between 2019 and 2022 (see again Mr. Ogilvie’s Supplementary Schedule 2, Ex 24).
224The Court wishes the father in this Judgment to be specifically made aware, that it would have been far easier for the Court to simply cite these factors, and his other problematic withholding of evidence expressed elsewhere in this Judgment, and just accept the mother’s DivorceMate calculations. Perhaps that was even an option open to this Court: see for example Delongte v. Delongte ¶ 13-17. However I nevertheless gave the father’s argument careful and serious consideration, because the Court is of the view that the mother’s calculations contain errors, and adopting them would result in an unfair outcome, despite the father’s conduct. The Court should not just make a support Order based on what it views to be incorrect calculations that would have the effect of consuming a too great amount of a payor’s disposable income, just because the payor has been less than helpful in the presentation of his own case.
225What my inquiry summarized at Schedule “C” to this Judgment reveals, is that although the father exaggerated and misrepresented the financial impact of the already existing Order, the total package now sought by the mother would in fact leave him with between a low of 32% and no more than 39% of his net pay (after taking into account his variable compensation). When compared to the mother, and even though she has the two children in her care, she would have 60% or more of the parties’ combined net disposable incomes (“NDI”) in each of 2019, 2020, 2021, 2022 and 2024. The “With Child Support” Formula does not normally contemplate this.
(1) How the “With Child Support” Formula Operates
226There is no dispute in this case that the “With Child Support” Formula applies. Not only did the mother tender DivorceMate calculations purporting to use this formula, but there are children, and the spouse against whom spousal support is sought, is also paying child support: see Chapter 8, page 72 of the SSAGs dated July 2008. At the end of this trial, the mother inaccurately stated what goes into this formula, and how it operates.
227The SSAGs in general are built on the core concept of income sharing. They look to the incomes of the parties and rely on a mathematical formula to determine the portion of spousal incomes to be shared. The amount of income to be shared and how it is apportioned depends on the formula adopted: see Chapter 3.1, page 27 of the original document dated July 2008.
228In cross-examination, Ms. Boulby asked Mr. Ogilvie to admit that the “standard approach” for both child support and spousal support is “to start” with the provisions of the Guidelines “which would be gross income”. While Mr. Ogilvie agreed, and Ms. Boulby then argued that gross incomes are used for spousal support, that is not the end of the analysis when one uses the “With Child Support” Formula under the SSAGs.
229“From a technical perspective”… “because of tax and benefit issues”, and unlike the “Without Child Support” Formula, the “With Child Support” Formula uses “net rather than gross incomes” when it gets to the calculation of spousal support: see Chapter 8, page 72. This is repeated in Chapter 8.2, page 72. Also unlike the “Without Child Support” formula, it divides the pool of combined net incomes between the two spouses, not just the difference between gross incomes. The pool of net incomes that is divided is referred to as “individual net disposable income” or “INDI”.22
230At page 75, the SSAGs again say that the formula, “…must use net income. While gross income would be simpler to understand, calculate and implement, nothing remains simple once child support has to be considered. Different tax treatment demands more detailed after-tax calculations, and ability to pay must be more accurately assessed”.
231Indeed, the following description of the formula is contained in a text box on page 76 of the SSAGs, which I repeat verbatim:
232Professors Rogerson and Thompson go on to explain at pages 76 and 77, that the starting point is indeed Guidelines income, as was done in this case. But what was not done in the SAF or fully in the mother’s submissions, is from that, each spouses’ contributions towards child support is backed out in the “With Child Support” Formula. For the payor, that means the table amount, plus any contributions to section 7 expenses. For the recipient, that means a notional amount, plus contributions to section 7 expenses. Normally the software does that, when it works properly.
233Next, income taxes and other deductions must be subtracted from both parties’ incomes to obtain net incomes. As spousal support is transferred from one spouse to another, because of tax effects, the size of the total pool of INDI changes slightly, which complicates the calculations. Normally the software does this, through a process of looking at a number of hypothetical scenarios, or “iterations” until the correct result is reached.
234In this exercise, federal and provincial income taxes, EI premiums, and CPP contributions are permissible deductions. Any Schedule III adjustments, such as for union dues, should have already been made in the determination of Guidelines income. Health insurance, group life insurance and other benefits plans should also be recognized. The authors of the SSAGs concluded that deductions for mandatory pension contributions are not an automatic deduction. Government benefits and refundable credits are included in the INDI calculation.
235Once this calculation is undertaken, as the Chapter 8.32, pages 77 and 78 explain, each spouses’ INDIs are added together. Again, then one must “iterate”, or estimate hypothetical spousal support repeatedly, to arrive at an amount that leaves the lower income recipient spouse with between 40 and 46 % of the pool. While this can be done manually, it is challenging to do so. This is more complicated when there are section 7 expenses, as already explained. Normally, the software does this too.
236And while the authors explain at pages 78 and 79 that NDI is not the formula, the INDI ranges of between 40 to 46% nevertheless produce a NDI of between 52 to 58% in favour of the recipient under this formula. The middle of that in this case, would be 45% (father) and 55% (mother): see also K. v. H., 2024 ONSC 1612 ¶ 78.
237While in a different case the DivorceMate software might be adequate to figure this all out, here the software does not accurately adjust for a number of these items, nor does it arrive at an accurate outcome of INDI and consequently NDI, when there is a payor who is in Switzerland, subject to a whole different set of deductions, and where that payor does not get to deduct support paid at Canadian and Ontario rates.
(2) The Problem With Payors Who Legitimately Earn Non-Taxable Income
238The latter problem about deductibility is expanded upon in Chapter 12.8 of the SSAGs, at pages 130 to 132. There, Professors Rogerson and Thompson say that where payors legitimately receive their income on a non-taxable basis (or extrapolating from that, where they pay less tax than the Ontario norm), the non-deductibility (or lesser deductibility) of spousal support can pose a problem for a payor’s ability to pay. The “non-taxable payor is unable to pay the [same] gross amount of spousal support that would be required of a payor with the benefits of deductibility”.
239This is then elaborated upon, again, in Chapter 6 of the Revised Users Guide, 2016. At page 21 of that document, the professors clarify that non-taxable income should be grossed up for child support, but not for spousal support under the “With Child Support Formula”. And specifically, at Chapter 12 (j.1), page 68, the authors say this should be done where a payor resides in a country, where he does not enjoy the full benefit of deductibility as a Canadian payor would. This particular problem was referred to by the Court in James v. Torrens, 2007 SKQB 2019, where grossed up income was used for child support but a more nuanced, albeit not fully explained analysis, was done for spousal support: see ¶ 5 and 8. See also the recent decision of McGee J. in K. v. H., 3035 ONSC 3972 ¶ 7.
240Another example of the problem of reflexively using the software and inputting grossed up income into an inappropriate DivorceMate input field, was acknowledged by Sager J. in R.N. v. C.S., 2020 ONCJ 263 (although done in a different yet still analogous way). In R.N. v. C.S., Sager J. was with the calculation of gross Guidelines income for child support (as opposed to applying the “With Child Support” Formula for spousal support). Nevertheless, at ¶ 106, she wrote, “[t]he mother is seeking a monthly child support payment (not including spousal support) that in one year exceeds the father’s monthly disposable income and in other years makes up anywhere from approximately 60% to 95% of it.” Notably, Sager J. was confronted with some of the same problems that presented in this case: a disorganized presentation by the father, and non-disclosure. She nevertheless recognized the issue, and awarded a remedy.
241Sager J. chose to address the issue by making an adjustment to income, grossing up only some but not all of the payor’s non-taxable sources of income to achieve a just result, as opposed to adjusting quantum in the end result. This is an approach I cannot take, because I am not dealing with child support only and the incomes are agreed to in the SAF. But I still refer to this case as it is another example in which a court was alive to the financial positions of the parties after any order that the Court might make, and determined that needed to be remedied.
(3) Whether It is Appropriate to Use DivorceMate Software In this Case
242The mother’s insertion of the father’s grossed up income into DivorceMate as Ontario employment income is problematic. It does not correctly net out the grossed up amount to achieve the after tax amount as required by the “With Child Support” Formula before “interating” to find the correct quantums of spousal support. It cannot possibly account for his foreign taxes when it comes to considering deductibility and the consequent amounts left over to him, as required in Step 2 of the formula (repeated in the aforementioned text box) since the software is built around the Canadian taxation system. The Court spent some time trying to work with the software to see if there was a way to make a reasonable adjustment or to override it; if there is a way, I did not discover it.
243That said, the DivorceMate software is not completely useless in a case of this nature. It works well to calculate child support. Once the Court did manual “iterations” of its own, hypothetical amounts for spousal support could put into DivorceMate, to get an accurate picture of the mother’s NDI, as she is subject to taxes here. After manually calculating the father’s net incomes, the end result emerged. 23
244The Court found it could calculate the after tax benefit of spousal support to the mother using DivorceMate for any retroactive analysis, for the same reasons. The after tax cost of net spousal support for the father would be inaccurate with Divorcemate for the same reasons (different deductibility). But the Court found that could be manually calculated too.24
(4) The Several Less than Ideal Options Before the Court, that It Does Not Adopt
245Before determining that the Court could resolve this case based on the record before it, the Court first considered a number of other options, in view of these problems.
246First, I considered whether the Court could or should undertake all of the calculations from scratch, without using the software at all, like what Mr. Ogilvie embarked upon doing. This was not feasible given the number of years for which calculations are required and the fact that the parties themselves each felt the need to retain experts. Frankly this is also the job of the parties and counsel, if expert assistance is not going to be sourced. It would have been helpful to have had that expert assistance, but the father instructed Mr. Ogilvie to do something else, the mother did not call Mr. Ranot to testify, and I presume, but do not know for certain, that during his pre-trial mandate, he did not adjust for any of the above.
247Second, the Court also briefly considered, as Sager J. did, whether to use a different income for the father, to remedy the situation. Relatedly, the Court considered whether to use the $350,000.00 soft cap exception that the SSAGs also might provide for in a case of this nature. However, I have declined to do so. I have already explained how the Court relies on Sager J.’s decision. To elaborate on what I already said about how the Court has treated Sager J.’s decision, I do not venture into the terrain of a different income determination because:
(a) On the one hand, notably absent from ¶ 155 of the SAF (which uses of the words “income for support”) is clarity about whether “support” is meant to be child or spousal support, or both. But on the other hand, in view of the father’s argument for a downward cost of living adjustment from the numbers in ¶ 155(b), I find his position was that at most, he intended by his agreement in the SAF for there to be these two different sets of incomes, one of which was to be selected by the Court depending on the cost of living argument. The parties did not intend there to be a third income for spousal support, if he lost on the cost of living argument;
(b) No one asked me to find a third income for the purposes of spousal support. Even the father, in arguing for a particular INDI, started with gross income. The INDI is just that gross income adjusted as the “With Child Support” Formula requires; it is not a different “income”; and
(c) Therefore, were I to use a different income, it might violate the terms of the parties’ agreement in ¶ 155 of the SAF.
248But using the grossed up incomes in ¶ 155(b) is not the end of the analysis for spousal support, as already explained.
249Third, I seriously considered ordering a court appointed expert. But I ultimately chose not to do this either, because:
(a) The mother could have, but chose not to call Mr. Ranot;
(b) The mother was not even going to call Mr. De Turris, until the father insisted on it. The father did not ask Mr. De Turris much by way of useful questions, and he could not get the evidence about his 2023 tax rates this way anyway, given his approach to his 2023 tax return and his failure to procure an expert report about these taxes;
(c) Under the circumstances, it would have been necessary to make a disclosure order for the unredacted return, to which the mother already objected mid-trial on fairness grounds, and appoint two experts, one to address the missing tax information and another to then do the support calculations;
(d) The mother has objected to the Court appointing an expert, for reasons of costs; and
(e) Importantly, there was already helpful data within Mr. Ogilvie’s reports and calculations, from which the Court could extract, to do its own calculations, notwithstanding the father’s instructions to him, to deduct a cost of living factor.
(5) Another Option: Consider a Support Award at the Lower End of the Range
250The mother’s principal argument, was that the Court should order the mid-range of the SSAGs, but using her calculations, because of the nature of the mother’s compensatory claim and other factors: see also K. v. H. ¶ 78. Ms. Boulby stated that the mother could have asked for the high range, but taking into account that the child support and the fact that there are section 7 expenses, it seemed appropriate to pursue the mid-range number.
251I nevertheless considered, as Ms. Boulby submitted might be done, whether just to make a downward adjustment to the spousal support within the ranges set out in the mother’s DivorceMate calculations, to compensate for these tax issues. But I have not opted to do that either.
252First of all, the mother did not really concede that it would be appropriate for the Court to do this; rather this was proposed as a hypothetical option to the Court in response to its questions. For example, in saying that this could be done, Ms. Boulby still submitted that the fact that the father has a new spouse, who is a high income earner, is also relevant to the Court not taking this approach. To this I would add there is no good reason to impose “work incentives” or “self-sufficiency incentives” on the mother: see Chapter 9 of the SSAGs; see also the Revised Users Guide, 2016, pages 45-48; see also K. v. H. ¶ 77, which might be a different reason to order the low range.
253More importantly in my view, I do not find this suggestion, to the extent that it was in fact made, to be satisfactory anyway. The ranges themselves on the mother’s calculations are not accurate, so pushing the quantum of towards the lower end, is not principled. It does not address my concern about the father’s ability to pay. I find the ultimate order should be based on the most accurate assessment of ability to pay, in view of the deductibility problem.
(6) The Court’s Approach
254Ultimately, as I have already said, what the Court embarked upon, was to use DivorceMate where it could, and to undertake manual calculations to adjust for the father’s circumstances. The parties should be aware that it has taken the Court several hours over multiple days to digest the arguments, analyze the evidence and undertake calculations, to craft what the Court believes to be the correct result.
255The Court does not see itself as using different incomes for the father from those agreed to in the SAF as the starting point on any of its calculations. As the “With Child Support” Formula requires, the Court is starting with the mother’s position (gross income) but making the adjustments that the “With Child Support” Formula actually directs, to ascertain what the reality of the parties’ financial positions will in the end be.
256On its face, the Court’s calculations appear to fall below the ranges in the mother’s DivorceMate calculations. But that is not so when the real numbers are determined. The Court has searched for the true mid-range. Alternatively, if I am mistaken, and I have in fact departed from the ranges, then I would have found that there should be an exception to the application of the SSAGs because of the deductibility. In saying this, I rely on Paul v. Paul, 2008 NSSC 124, where the Court opted to order an amount of spousal support that was below the SSAGs ranges.25
B. The Court’s Calculations
257Schedules “B” and “C” provide the details of how the Court used a combination of DivorceMate and manual calculations.
258Schedule “B” contains the Court’s DivorceMate calculations. These calculations depict several things.
259First, these re-create the mother’s position, that the grossed up incomes from ¶ 155(b) of the SAF, plus $600,000.00 for 2023 and 2024 going forward, should be inputted as employment income. But they have been modified to include the correct determination of her incomes (with the investment incomes), the correct tax deductions (legal fees between 2020 and 2023), the correct inputs for section 7 expenses. DivorceMate accurately depicts what the mother’s NDI would be (in dollars, not as a percentage) for any of the quantums of spousal support in the various scenarios in the DivorceMate calculations, but not the father’s. The Court has done this as a starting point for comparison purposes.
260Schedule “C” then contains two sets of calculations for each year. The first calculation for each year calculates and puts into a chart what both party’s NDIs (in dollars and as a percentage of the combined NDIs) would be, if the mother’s position, above, were to be adopted. The mother’s NDI (in dollars) is just transposed from DivorceMate; the father’s NDI had to be manually calculated. The parties’ respective percentages of the combined NDIs had to be manually calculated.
261To do the manual calculation of the father’s NDI (in dollars), the Court did not rely on any data that didn’t emanate from an exhibit or that wasn’t otherwise proven at this trial. There are over 100 footnotes that painstakingly reveal the source of each input.
262To calculate the father’s NDIs under this scenario though, one cannot end with the grossed up incomes in ¶ 155(b) of the SAF, because DivorceMate does not net it down properly, and because of his different deductions in Switzerland. Fortunately, the father’s net equivalent incomes for 2019 to 2021, before the gross up that turned into ¶ 155(b), were already in the SAF for some, but not all of the years. Where that information was missing in whole or in part from the SAF (i.e.. for 2022, 2023 and 2024), it was available in the Mr. Ogilvie’s Supplementary Schedules (Ex 24), or in the case of 2024, extrapolated from what I did with 2023, after adjusting for the different amount of section 7 expenses in MacPherson J.’s Order.
263Helpfully, in Schedule 1.1 of his Supplementary Schedules (Ex 24), Mr. Ogilvie also estimated that tax deductibility for the father’s increased spousal support payments, for all years, using Swiss tax rates.26 While Mr. Ogilvie did so based on assumed spousal support payments that the Court is not necessarily ordering, and while the particular tax refund might change somewhat as the amount of spousal support changes, this is the best evidence the Court has about deductibility. The Court found it was able to extract a reasonable tax enough rebate from Mr. Ogilvie’s calculations, convert it into a percentage, and then adjust the father’s gross spousal support into a net to figure out his true cash flow after the payment of support, to figure out what he will actually have left after the payment of all forms of support, in net dollars.27
264The Court did not use Mr. Ogilvie’s tax calculation for 2023 because it was based on an assumption about the father’s current tax situation, that the father chose to withhold from the mother and the Court. Therefore, I instead adopted the tax calculation from 2022, for both 2023 and 2024.
265The second calculation for each year in Schedule “C” shows what amount of spousal support will leave the parties at the true midpoint (i.e.. the 45%-55% NDI split). To figure that out, the Court had to “iterate” (i.e. try out a series of sample calculations on DivorceMate to get the mother’s NDI as a percentage of the combined NDIs to really fall at 55%, and manual ones to get the father’s at 45%). Each change to spousal support changed the apportionment of section 7 expenses, slightly. Eventually the numbers worked.
266Finally, page 15 of Schedule “C” calculates the lump sum that is owing. As a lump sum in full and final satisfaction of prior spousal support, this is a net number to the mother. The mother argued that the Court should use her after tax benefit of spousal support to calculate the lump sum. This would have been the easiest approach, because again, in the mother’s case, the DivorceMate software accurately calculates that after tax benefit.
267On the one hand, there is some suggestion in the evidence (or based on the Court’s adverse inference (see Footnote 26)), that the father can deduct any retroactive support, and so his support paid does not need to be netted down. On the other hand, this is not a situation, like in K. v. H., where there is a payor who did not in the past pay spousal support, or (with the exception of 2023), where there is a payor who inaccurately disclosed his income: see again K. v. H. ¶ 82. Rather, temporary spousal support was ordered early on in this case; the Court made the best order it saw fit based on the record before it at the time.
268Since then, the cost of the section 7 expenses emerged. Both sides retained valuators. The father has also lost out on some other tax deductibility in this trial because of problems of proof, such as the costs of disposition that may attach to his pension, and perhaps in the 2023 calculations. Despite the fact that the father is the ‘maker of his own misfortune here’, I am prepared to take that into account in this limited way to try to balance these things out. And regardless of the apparent deductibility of any retroactive support by the father, it is not just the father who enjoyed low tax rates; so did the mother and she did not include her legal fees. The end result is that there is not a huge divergence between the two sets of numbers.
269In the end, the Court finds that its task now is to adjust for what was done in the past, following the fleshing out of the evidence at the trial. Therefore I have chosen to use the mid points between the mother’s after tax benefit and the father’s after tax cost of spousal support, for the reasons that I have just expressed.
270Because DivorceMate does not accurately calculate the father’s after tax cost of spousal support, the Court was nevertheless able calculate it, a simple mathematical exercise, of taking the same tax rate that was used to determine the father’s cash flow, and applying it to the gross number. The details of those calculations are explained in the Chart on page 15, and the footnotes thereto. The mid point between the mother’s after tax benefit and the father’s after tax cost was an even simpler calculation.
271However, for 2020, 2021, 2022 and 2023, the Court had to prepared an extra support scenario to accurately figure out the net numbers. That is because the father already paid $2,700.00 in each of these years.
272Rather than undertake yet another set of calculations to figure out the net value of the $2,700.00 payments in 2020 to 2023, and then deduct that net amount from the net value of the total gross amounts of spousal support being ordered, I simply deducted the gross amount of the $2,700.00 prior payments from the gross spousal support payment being ordered, and then netted down the net of those two numbers. This required less calculations.
273The $2,700.00 reduction to the gross spousal support being ordered can be seen in the 5th support scenario in each of the 2020, 2021, 2022 and 2023 DivorceMate calculations at Schedule “B”, as can the mother’s after tax benefit of that. Again, the father’s after tax cost is manually calculated, in Schedule “C”.
274I did not do this extra scenario for 2019, because the father did not make prior tax dedutible payments pay in 2019, so there was no need. And the parties have not filed their taxes yet for 2024, so they can deal with the already paid $2,700.00 monthly amounts in 2024 to date, next year when they do file.
275In the result, I find that the father owes the mother a lump sum of $261,590.00 for the period between May 1, 2019 and December 31, 2023. The calculations for 2024 are also set out in the applicable DivorceMate for that year in Schedule “B”, and on in Schedule “C”. The sum being ordered is $10,000.00 per month. Because he already paid $2,700 for the first months of this year (and I assume also in July and August), the father owes a further amount of $58,400 so far this year, not $80,000.00. I make separate provision for the taxability of the 2024 amounts in the Order, based on what I said in the previous paragraph.
C. The Parties’ Budgets As A Litmus Test
276I also verified the reasonableness of this approach, with reference to the prospective amount being ordered, and compared it to the parties’ budgets in the financial statements they filed for this trial, as a litmus test to see whether they could meet their expenditures or proposed expenditures.
277The prospective for monthly spousal support of $10,000.00, when combined with child support and section 7 expenses in MacPherson J.’s Consent Order of June 3, 2024, leaves the mother annually with $176,820.00 after tax. Her budget on her financial statement sworn May 3, 2024 is $138,360.00 annually. While the annual amount of combined support being ordered exceeds her budget, that is not necessarily inappropriate given the nature of her support claim, the fact she has the two children in her care, and the fact that the father is now in a dual income household.
278Moreover, a number of the mother’s budget items are modest. The most “extravagant” expenditures pertain to the children. While the section 7 expenses for therapy as expressed in the Consent Order of MacPherson J. dated June 3, 2024 have decreased somewhat since 2019, and the parties agreed to fix an annual amount going forward, with the father’s share apportioned monthly, the agreed to total amount is closer to the lower amount of past section 7 expenses in the Consent Order, and they were just for therapy expenses. I am concerned that there will be others in the future, that aren’t being shared. Therefore the rest will come solely out of the mother’s pocket, and therefore out of her spousal support.
279Costs have not been determined yet. The Court makes no comment upon that until it sees any offers and hears the submissions. But depending on the outcome of that, it may be that the mother will have to pay legal fees, or her debts incurred for legal fees reflected on her financial statement sworn May 3, 2024, or some of them, out of her pocket, too.
280The mother also has very modest housing expenses. But she has also prepared a proposed budget, attached to her financial statement sworn May 3, 2024, that provides for a higher amount for rent than the contribution she currently makes to her parents for their housing expenses, and higher utilities expenses and other household expenses, like groceries, as if she weren’t living with her parents. In her trial affidavit sworn May 3, 2024, the mother says that the “real difference between [her] actual and proposed budget is that [she wishes] to have [her] own home with the children.” While her parents have been “extraordinarily generous”, she would like to live independently from them. This is reasonable.
281The mother’s proposed budget is for $242,544.00 per year. If the proposed budget is adopted rather than the actual there is no longer an overage; there is a shortfall of about $65,000.00 Now the details of this proposed budget were not particularly parsed through during this trial. And it was not just housing expenses that increased. One of the items that increased for example, that the mother did not highlight, was a budget item for vacations, which increase may not be realistic.
282In regards to the father, my Order leaves him with at least $146,736.00, and possibly more if he gets a further tax break from any of the increased support payments as his expert opined. When the Court backs out the amounts listed on his financial statement sworn May 6, 2024 in the section “automatic deductions”, which deductions were already taken into account in coming up with his NDI, the support payments that are already accounted for in the Court’s calculations (also already taken into account in NDI), and legal fees, which I know very little about (but should no longer be incurred once this case is over), he has a shortfall of $58,764.00.
283By comparison, he says he spends more than what the mother proposes to spend for rent. He says he spends about the same as the mother, just for his own share of groceries (not including his new spouse or her children), even though the mother has two children in her care. His budget for meals outside the home is double what the mother proposes. He also proposed sums for vacations, although only half of what the mother proposed to spend.
284More significantly, he is also living with his new spouse. The father claims not to have included any of his spouses expenses in his budget. The Court does not find this to be credible. Even if it is true, the Court does not find it to be reasonable that she does not contribute to their joint housing expenses, which means the father’s budget is inflated. It is also not reasonable, if the spouse is not contributing to housing, that the father then sometimes pays for her children’s entertainment in an unspecified amount, which he apparently buried in his own entertainment budget of $900.00 per month.
285As it turns out, if the Court takes both sides budgets completely at face value, they both have a similar budget shortfall. Both sides may need to make adjustments to their spending, or in the mother’s case, to her proposed budget.
286In conclusion, the Court’s calculations have ameliorated the father’s complaint about his limited left over net pay to some degree, although I appreciate probably not to the degree that he expects. But his expectations that he pay no spousal support, or alternatively $1,000.00 per month, are not reasonable. The Court is not prepared to go any further, given the circumstances of this relationship, the factors that the Court has already summarized respecting the strength of the mother’s support claims, and the fact that the mother has the two children in her care. The outcome is also in my view consistent with what the “With Child Support” Formula provides for, in that it leaves the parties with a roughly 45%-55% NDI split, calculated to the best of my ability.
PART XII: THE MOTHER’S MOTION FOR SUMMARY JUDGMENT RESPECTING PARNTING
A. Background
287The mother brings a summary judgment motion to enforce Minutes of Settlement dated August 22, 2023 respecting the parenting issues. This motion arose as follows.
288Following the custody and access assessment, and following a Trial Scheduling Conference on August 4, 2023, the mother served an Offer to Settle dated August 11, 2023. The father made a counter proposal by email dated August 12, 2023 at 4:46 AM, that he would accept the mother’s offer if she agreed to pay one half of the costs of the assessment as a credit to him in the equalization payment that he would owe her. The mother accepted the counter proposal at 4:32 PM the same day. Ms. Boulby wrote, “[m]y client agrees to your proposal below. I will draft minutes of settlement and send them to you tomorrow”.
289Ms. Boulby sent the draft Minutes on August 13, 2023 at 10:02 PM, also by email. Ms. Boulby asked the father to sign these in front of a witness, said she would arrange for the mother to sign, and said she would then file these with the Court. On August 14, 2023, the father told Ms. Boulby that he was travelling that week, and that “Karen”, who I understand was a lawyer then assisting him, was on vacation. He said the soonest he could get the document signed in front of a witness would be on Monday, August 21st.
290The Minutes were in fact signed by the father (electronically) on August 21, 2023. The mother signed them on August 22, 2023. On August 23, 2023, someone in Ms. Boulby’s office sent the father a fully signed copy of the Minutes, along with a typed up draft Order. She asked the father to sign a consent to the draft Order, so that it could be filed with the Court to obtain an actual Final Order.
291The following day, the father objected to the first sentence of ¶ 18. The sentence objected to is worded in the same way in the draft Order, the Offer to Settle and the Minutes. It is also the exact same wording as that which Douglas J. had ordered in ¶11 of the temporary Order dated November 13, 2019, that had been in place for almost four years at that point. The disputed sentence reads:
Ramzy shall not apply for obtain a new passport except on 30 days’ written notice to Randa.
292In fact, the settlement documents and the draft Order repeated a number of other terms that Douglas J. included in the temporary Order, to prevent the children’s removal from Ontario by the father. In particular, although not necessarily identically worded, all of these documents have a non removal term, a requirement to notify the CBSA before the father exercises parenting time with the children, the requirement to add the children to the Passport Canada Lookout List, and a prohibition on the father attending within 1 km of an international airport or border with the children.
293In any event, the father now wrote that the sentence about the passports “has to be removed” because “it is none of your client’s business as to when I renew my own passport”. He then said he would sign “the amendment document” once sent.
294On August 26, 2023, Ms. Boulby wrote back to the father, saying that the issue was resolved by way of an accepted Offer to Settle, that had been incorporated into Minutes, that the father had already signed. She said that he could not change the term. She also said that she would bring a motion to Bennett J. if the issue did not resolve. The father then responded again on August 28, 2023, and claimed that he had agreed to this term inadvertently, and that Ms. Boulby had added this term, without notifying him, like she had otherwise done at some point in the past respecting “the Dr. Butkowsky conditions”.
295The father went on to attack Ms. Boulby’s professionalism, referring to the Rules of Professional Conduct. He said there was no valid reason for this term, which was “in no way connected to parenting” and that he “would not be exercising parenting time with [the] children”. Yet in his affidavit sworn September 6, 2023, filed in response to the mother’s motion for summary judgment, the father’s version of events is that he was the one who made a mistake when he read the documents, including even when he signed the documents in the presence of the lawyer who was helping him. He says he only intended this clause to apply if he was seeing the children, which he is not going to do. That was his mistake, not anything that Ms. Boulby had done.
B. Analysis
296In my view, the resolution of this issue is straightforward. I considered the father’s arguments about this term, that it is not necessary and overbroad, since he won’t be seeing the children, and that it is uncertain, cumbersome, a violation of his privacy, and unenforceable. I do not accept any of these arguments.
297First of all, in regards to the father’s failure to sign the consent to a draft Order, at most this was a subsequent performance obligation, and not a condition precedent to an agreement, the terms of which were already agreed to in signed Minutes: see for example MacRae v. Simpson, 2002 CanLii 2723 ¶ 24. It is also something the Court can dispense with under the Family Law Rules.
298Second, in regards to the necessity of this term, clearly, a number of terms in Douglas J.’s 2019 Order, and in the subsequent settlement documents are directed at preventing against the children’s removal from Ontario. The father did not object to any of those other ones; only the passport term. While I recognize that perhaps the father isn’t bothered by these other terms as many apply only if he sees the children, not all of them do. For example, the children are being placed on a watch list regardless if he sees them or not. A concerned parent might have feelings about this. Yet no one seriously suggested that the Court should not Order these other terms. To the contrary both sides agreed that the balance of the Order should be granted.
299In regards to the father’s arguments about the alleged uncertainty, cumbersome and unenforceable nature of this term, the uncertainty argument arises from the fact that the parties do not at this time know for how long it will operate. That is a function of how long the children will be children of the marriage. The recent decision of the Ontario Court of Appeal in J.F.R. v. K.L.L., 2024 ONCA 520, might even add to this “uncertainty” in the case of V. But all parenting Orders are “uncertain” in the sense that they operate into the future, unless varied, until they no longer operate as a result of a change to a child’ status. The father needs to get some legal advice about how long the terms applies if he continues to have questions about this. Although this was discussed during the submissions, it is really not for the Court, or Ms. Boulby, to explain it to him.
300The term is also not cumbersome. The father exaggerated this in argument. There is nothing in the settlement that prevents the father from obtaining a new passport; rather he just has to send a quick communication to the mother and tell her if he does. Moreover, passports last for several years at a time. In reality, this obligation will be infrequent.
301I did not find persuasive the father’s argument, about what might happen if he loses a passport and then forgets to tell the mother that he renewed that lost one. Why exactly should he forget? In any event, although in correspondence he sent to Ms. Boulby dated September 4, 2023, the father raised this concern about being in “technical” breach of an order, the consequences for any errors or mistakes made, as opposed to deliberate breaches of a term in an Order, are not the same.
302At the same time, the father also seemed to blatantly suggest to the Court that he would not comply with this term, if it is ordered. That would not be a technical breach. And while the father may not be subject to the supervision of the Court on this point, since he is out of the jurisdiction and the Court’s contempt powers are limited, the father may very well have to come back before the Court in the future to seek financial relief. He undermined the credibility of his stated concern about “technical breaches” when he seemed to suggest that he would blatantly not comply. He would be well advised to be in compliance with all Orders of this Court.
303The father’s privacy argument is a weak one; this case concerns children. Furthermore, the father might very well have a change of heart after the release of this decision, or at some later point beyond that, and he might decide to start seeing the children again. I nevertheless considered, as the father asked, whether to re-write the term, to make it apply in this situation only. But carried to its logical conclusion, why then couldn’t some of the other non-removal terms or even some of the other parenting terms then be re-written too? Or why are some of the other terms in the Minutes even there anymore at all, if he doesn’t have that change of heart? For example, if the father is not going to have anything to do with the children going forward, then why must the mother still consult with him as set out in ¶ 2 of the draft Order? Why should the father still get access to documents as set out in ¶ 4? Why is it necessary to make provision for a process for the father to be reunited with the children as set out in ¶ 14, now that he has declared that he will not be following the process? Should those terms be deleted? Or maybe only be Ordered, if the father decides to start coming to Ontario? This underscores the problem with cherry-picking, and it exposes the can of worms the father is trying to open.
304The Court is supposed to give respect to parental autonomy and intention as reflected in their agreements: see for example Heim v. Heim, 2011 ONSC 129 ¶ 14. Now in the case of settlement agreements involving children, this is subject to a best interests’ analysis, where a term is not consistent with those interests: see for example section 56(1) of the Family law Act, or paragraph 16.6(1). But the father did not make a valid best interests’ argument rooted in any evidence that might engage either of these statutory provisions, either.
305While the mother argues that the father’s claim, that he wasn’t aware of the meaning of the term, is not credible (given that it had been in multiple documents previously and the father signed the Minutes in the presence of a lawyer)28, if I give him the benefit of the doubt, this is a case of unilateral mistake. In which case, I also agree with the mother, that the father did not make out a case for rectification in that scenario: see Heim v. Heim ¶ 18, citing Performance Industries Ltd. v. Sylvan Lake Golf & Tennis Club Ltd., 2002 SCC 19.
306This is not a situation of an oral agreement that was not documented properly; the entire sequence of events leading up the Minutes, followed by the objection to the draft Order, was done in writing, beginning with an Offer to Settle.
307Finally, were the Court deciding the passport term (and the other non-removal and related terms for that matter) on the merits in a hypothetical scenario where agreements about parenting issues had not been reached, it might have found that the evidence about the so called flight risk to be lacking. For example, as indicated earlier, some of the evidence tendered by the mother at this trial was inflammatory, such as the statement about Hezbollah.
308This has upset the father, understandably. At ¶ 22 of his affidavit sworn September 6, 2023, that father points out that he has lived in Switzerland for 22 years, he is employed there, and he is remarried there.
309For the benefit of the father, it is the Court’s view that it was entirely unnecessary for the mother to have gone down this unfortunate path of inflaming the dispute by talking about Hezbollah, and in so doing, the mother probably made the dispute worse. The mother could have simply said that Lebanon is not a signatory to the Hague Convention, as she said in her Reply affidavit sworn September 7, 2023, and so her options in the event of an abduction would have been restricted.
310However, even where the Court agrees with some of the father’s frustrations about this evidence, the Court is not deciding the issue afresh, as if there had been no agreement. And the Court does not know what the evidence might have been on all of these issues, not just the passport one, had there not been a settlement, and a full blown parenting trial.
C. Conclusion Respecting the Summary Judgment Motion
311There shall be a final Order based on the entirety of the Minutes of Settlement dated August 22, 2023.
PART XIII: OTHER
312MacPherson J.’s Final Order of June 3, 2024 has both the temporary and final boxes at the top of page 1 checked off. Ms. Boulby asked me to clarify this.
313I find the Order checked off the temporary box, only because only some, but not all issues settled. This included the section 7 expenses listed in ¶ 6. They were neither an exhaustive list, nor were they apportioned yet.
314Very clearly, all of the other items that are in the Order, were not litigated at this trial, and were agreed to coming into the trial, to narrow issues. I find that ¶ 1 to 5, and 7 to 11 of this Order, are final.
PART XIV: ORDER
315I make the following Final Orders:
Equalization Payment Under the Family Law Act
(a) The father’s claim to deduct notional costs of disposition on his Swiss pension is denied;
(b) The father’s claim to deduct a loan to his father for his MBA at the date of separation is denied;
(c) The father shall pay to the mother an equalization payment of $86,932.32;
Prejudgment Interest Under the Courts of Justice Act
(d) The father shall pay to the mother prejudgment interest on the equalization payment, in the amount of $9,226.73;
Post-Separation Adjustments As A Credit to Equalization
(e) On consent, the father shall receive the credit of $1,580.00 that is provided for in ¶ 7 of the Order of MacPherson J. dated June 3, 2024;
(f) On consent, the father shall receive a credit of $21,680.00, representing 50% of the cost of Dr. Butkowsky’s assessment;
(g) The net amount owing for the equalization payment and prejudgment interest, less these credits, is therefore $72,899.05;
Section 7 Expenses Under the Divorce Act and the Federal Child Support Guidelines
(h) In full and final satisfaction of retroactive section 7 expenses, the father shall pay to the mother the sum of $45,838.50;
Retroactive and Prospective Spousal Support Under the Divorce Act
(i) In full and final satisfaction of retroactive spousal support, the father shall pay to the mother the lump sum of $261,590.00. As a lump sum, this amount is net of tax to the mother, and does not need to be included in her income pursuant to the Income Tax Act;
(j) In addition, the shall pay to the mother the sum of $58,400.00 for spousal support for the period January 1, 2024 to August 1, 2024;
(k) Commencing September 1, 2024, the father shall pay to the mother spousal support in the amount of $10,000.00 per month;
(l) I understand the 2024 amounts to be deductible to the father in Switzerland, and they shall be included in the mother’s Canadian income. Because the amount of $58,400.00 in paragraph (j) for the first 8 months of 2024 was calculated after deducting the $2,700 per month that the father paid pursuant to the temporary Order of Kaufman J. dated December 18, 2019, and assuming this Order is complied with in full, the mother shall include the sum of $120,000.00 in her taxes when she files for 2024, and likewise in future years;
(m) The lump sum amount of support for prior periods, and the net equalization payment, is subject to further Order about a method of payment, if either party decides to make submissions;
(n) If he has not done so already, the father shall comply with ¶ 10 of Kaufman J.’s Order dated December 18, 2019, which required him to provide the method for money to be taken out of his Swiss pension. That information shall be filed with the Court if either party makes submissions about a payment method;
(o) The Minutes of Settlement dated August 22, 2023 shall be incorporated into a Final Order of this Court in their entirety. The draft Final Order attached to the 14B Motion dated August 29, 2023 at Tab 1 of the mother’s Motion Record filed at the outset of this trial, shall issue, without the requirement for any further approval of the father, or a signed consent to the draft Order issuing;
Other Terms Under the Courts of Justice Act and the Family Responsibility and Support Arrears Enforcement Act, 1996
(p) This Order bears postjudgment interest at the rate prescribed in the applicable regulation to the Courts of Justice Act. The standard postjudgment interest clause shall be included in the Order to be entered.
(q) The standard FRO clause for support enforcement shall be included in the Order to be entered.
Costs and Additional Submissions
(r) If the parties cannot agree, the mother may file costs submissions in writing limited to 5 pages, double spaced, plus a Bill of Costs and copies of Offers to Settle. Case law need not be filed but may be cited in the submissions. If the mother intends to make submissions about payment method, she may have an additional page to do so. These submissions are to be field on or before September 23, 2024;
(s) The father may file costs submissions and any submissions about payment method, subject to the same page limits and attachments, by October 21, 2024; and
(t) It is the Court’s intention to deal with costs and payment method in writing. However the Court reserves the right to require oral submissions upon reviewing what is filed in writing.
Justice Alex Finlayson
Released: August 20, 2024
COURT FILE NO.: FC-19-58798-00
ONTARIO
SUPERIOR COURT OF JUSTICE
BETWEEN:
Randa Issa
Applicant Mother
– and –
Ramzy Haidar
Respondent Father
REASONS FOR JUDGMENT
Justice Alex Finlayson
Released: August 20, 2024
Footnotes
- The Court was nevertheless able to determine this, by a combined reading of a number of paragraphs of the SAF, and from other evidence tendered at this trial.
- Professors Rogerson and Thompson distinguish this situation, from one where a payor earns non-taxable income illegitimately, such as from illegal activity.
- The father says his decision is based on the cost to travel to Canada, the cost of any professional fees associated with the plan to which he agreed, and the amount of time he would have to spend here, to comply with that plan. While he says these costs would be prohibitive, he did not make any arguments that his support should be adjusted downward to take them into account.
- The mother’s use of the word “prior period” support is because she says that most of the claim pertains to support after the date of the application, which is different from “retroactive” support. To the extent that I have used the words “prior period” as opposed to “retroactive” in this Judgment, or vice versa, I find the distinction, if one exists, does make a material difference.
- For example, a third and different amount of income.
- The paternal grandfather’s affidavit also confirms that 61,700 CHF was transferred, not 62,000 CHF.
- The father had also requested a French Interpreter for Mr. Sleiman, even though French is his second language. The Court made provision for him to come back and testify again on a second day, with an Arabic interpreter, the language in which he is most comfortable, and instructed his son to ensure that there would be a better internet connection.
- To be clear, the determination of the mother’s incomes also impacts other issues in this case, such as the calculation of her share of the past section 7 expenses to be apportioned. Although I deal with this income issue here in the analysis about spousal support, the result applies otherwise where the Court considers the mother’s incomes, such as for section 7 expenses.
- Guidelines income is also used for section 7 expenses. See also the previous Footnote.
- Legal fees are entered into one’s tax return in the line item for “carrying charges, interest expenses and other expenses”. The mother did not supply the corresponding “Worksheet” that describes the nature of this deduction for all of the years that she claimed the deduction; she did for 2021. It describes the deduction as for legal fees. I infer that her deductions for 2020, 2022, and 2023 were also for legal fees, in the absence of another explanation.
- See for example McBennett v. Danis, 2021 ONSC 3610.
- See S.B. v. V.H., 2019 ONCJ 694; see also SSAG FAQs 2022.
- For example, within the meaning of section 19(1)(f), does the mother have a legal obligation to disclose it?
- The father made the same omission when arguing an inability to pay at times during this trial. He sometimes made reference to his base salary without the variable compensation.
- I gather this is referable to the figures in ¶ 155(b) of the SAF.
- See also Ferguson c. Thorne, 2007 NBBR 66 ¶ 106; and B. (A.D.) v. M. (S.A.), 2006 NSSC 201 ¶ 29-31.
- The only possible exception is section 20(2) which the Court of Appeal did not reference. Perhaps it was enacted subsequently. It provides the Court with some discretion where someone lives in a country that has effective rates of income tax that are significantly higher than those applicable in the province in which the other spouse habitually resides. This is not the situation in this case before me.
- However I note this with some caution, as this decision pre-dates the Ontario Court of Appeal’s decision in McGouran v. Connelly, which is binding on this Court. And the decision in P. (L.S.). v. P. (J.R.) did not actually give effect to the argument, as the premise was not proven with evidence.
- Mr. De Turris was apparently on vacation when this trial occurred; he testified by zoom from some island, apparently.
- There is reference to other expenses for the children, in the nature of activities (for example piano lessons/animation courses, and summer camp) in the mother’s financial statement sworn May 3, 2024, or in the proposed budget attached thereto, although any contribution from the father towards these in the future was not included in the Consent Order of MacPherson J. dated June 3, 2024, and they were not claimed for prior periods in the summary in the mother’s written closing submissions.
- (if in fact the father now pays higher taxes because of his re-marriage, which he did not prove)
- Incidentally, this is what Mr. Ogilvie attempted to manually calculate, albeit with the inclusion of a downward cost of living factor.
- The Court eventually concluded this was possible in this case through a combination of drawing adverse inferences and otherwise by extracting data from a number of the exhibits. This may not be possible in other cases where there were no experts to begin with, or a SAF, or even more gaps in the evidence.
- See the previous Footnote.
- In Paul v. Paul, the Court ordered only about 22% of the low range. To be clear, I do not go that low.
- The Court did not hear any evidence about how retroactive support payments are treated in Switzerland, for example whether they can be deducted, in what tax year and so on. The Court assumes, based on Mr. Ogilvie’s approach, that the father can deduct any increased support ordered for the past. By taking into account some tax deductibility, this benefits the mother in the calculations, because it increases the father’s cash flow. To the extent I need to do so, I would draw an adverse inference against the father on this point. If he wished to argue otherwise, he should have called expert evidence about it.
- The Court also wishes to highlight that Mr. Ogilvie already deducted the father’s taxes paid on previous support paid. This is also reflected in the SAF for a number of the years. The Court did not have to re do that, and the prior deductions are already taken into account in the calculations.
- The Court also observes that this lawyer was not called to testify, nor was her file on this issue produced. That could have been required, since the father put his state of mind into issue.