Court File and Parties
COURT FILE NO.: FC322/16 DATE: 2024/02/05
ONTARIO SUPERIOR COURT OF JUSTICE
FAMILY COURT
BETWEEN:
Beatrice Joyce-Corvaglia Unrepresented Applicant
- and -
Lawrence Marco Corvaglia Gary S. Joseph / Stephen P. Kirby (as agents) Respondent
HEARD: In Chambers, on written submissions
T. PRICE, J.
Endorsement
[1] I was contacted on January 11, 2024 by counsel retained post-trial by Mr. Corvaglia. (Holman v. Holman, 2015 ONCA 552 at footnote 1)
[2] He indicated that, in determining the arrears of spousal support owed by Mr. Corvaglia to Ms. Joyce-Corvaglia (Joyce-Corvaglia v. Corvaglia, 2023 ONSC 5368), I did not take into consideration the fact that the lump sum retroactive spousal support owed by Mr. Corvaglia would not be tax-deductible to him whereas, had the monthly payments been made at the time they were due, Mr. Corvaglia would have been entitled to deduct the payments from his income tax for each year they were being paid.
[3] Having scheduled an appearance to discuss this matter with Ms. Joyce-Corvaglia and counsel for Mr. Corvaglia, I set timelines for submissions by the parties about this issue.
[4] In her submissions, Ms. Joyce-Corvaglia advised of her opposition to Mr. Corvaglia’s request for the “netting down” of the lump-sum payment for arrears of spousal support. She also requested that a number of other issues which were not addressed at trial by either party be made part of any correcting endorsement that I might make. As I noted in paragraph 173 of my judgment, there were a number of issues which were not before me at trial and upon which neither party led any evidence. Accordingly, her request with respect to those other issues is not being addressed in this correcting endorsement.
[5] As counsel for Mr. Corvaglia noted, the “netting down” of retroactive spousal support payments to account for their different tax treatment has been done on multiple occasions by trial courts in Ontario (Thompson v. Thompson, 2013 ONSC 5500; Hume v. Tomlinson, 2015 ONSC 843; Jacob v. Jacob, 2017 ONSC 2497; Ghent v. Busse, 2021 ONSC 3278), and approved by appeal courts in Alberta, New Brunswick, and British Columbia (Samilova v. Mahnic, 2014 ABCA 65; P.(B.) v. T.(A.), 2014 NBCA 51; Robinson v. Robinson, 2012 BCCA 497).
[6] The Ontario Court of Appeal has held that trial judges are not responsible for addressing the income tax implications of support payments in orders that they make, especially when that issue is not addressed at trial, as was the case here, and that a trial judge has discretion to determine whether or not support payments should be reduced retroactively to account for notional tax reductions. (Fielding v. Fielding, 2015 ONCA 901; Barn v. Dhillon, 2023 ONCA 654)
[7] Mr. Corvaglia has requested the “netting down” of his retroactive spousal support despite not having paid it when due. He seeks discretionary relief. Having weighed the relief he seeks against the question of whether I should exercise my discretion in his favour, I have concluded that, were I to not exercise my discretion in his favour, I would be penalizing him simply because he stopped paying spousal support.
[8] The more appropriate way to address his failure to pay spousal support through previous years would be to award pre-judgment interest on the unpaid amounts. I have reviewed Ms. Joyce-Corvaglia’s application and note that she did not make a claim for pre-judgment interest. To award it at this time would be to impose a remedy on Mr. Corvaglia about which no claim was made and about which he had no notice. I decline to do so.
[9] In all of the circumstances, my Reasons at 2023 ONSC 5368 were amended to reflect Mr. Corvaglia’s requested relief with respect to “netting down” the arrears of spousal support that he owes to Ms. Joyce-Corvaglia.
[10] The formal judgment, as issued and entered, was directed to be amended accordingly.
[11] The following amendment was incorporated as Paragraph 192.1 of my Reasons for Judgment in Joyce-Corvaglia v. Corvaglia, 2023 ONSC 5368:
[12] [192.1] Based upon the authorities provided to me by counsel for Mr. Corvaglia following the Release of my Reasons for Judgment, I have determined that it is appropriate to “net down” the lump-sum arrears that Mr. Corvaglia is to pay to Ms. Joyce to account for a notional tax deduction that would have been available to him had the payments been made on an ongoing and regular basis when they were due. The netted-down figures are set out in the following chart:
| Year | Total Support - Netted Down for Tax |
|---|---|
| 2014 | $ 3,120.00 |
| 2015 | $ 10,092.00 |
| 2016 | $ 1,209.00 |
| 2016 | $ 2,808.00 |
| 2017 | $ 12,918.00 |
| 2018 | $ 13,074.00 |
| 2019 | $ 11,688.00 |
| 2020 | $ 11,424.00 |
| 2021 | $ 12,354.00 |
| 2022 | $ 12,342.00 |
| 2023 | $ 9,306.00 |
| Minus after tax value of Support Paid per paragraph 179 of the original Reasons for Judgment | -$ 9,936.00 |
| Total Retroactive Support Payable (after tax) | $ 90,399.00 |
[13] Paragraph 10(c) of my Reasons at 2023 ONSC 5368 was also amended to include the Total Retroactive Support Payable (after tax), as was Paragraph 193, to which was also added the words, “netted down for income tax purposes.”
“Justice T. Price”
Justice T. Price
Released: February 5, 2024
COURT FILE NO.: FC322/16 DATE: 2024/02/05 ONTARIO SUPERIOR COURT OF JUSTICE FAMILY COURT BETWEEN: Beatrice Joyce-Corvaglia Applicant
- and - Lawrence Marco Corvaglia Respondent REASONS FOR JUDGMENT T. PRICE, J.
Released: February 5, 2024