Reasons for Decision

Introduction

The descriptions “high conflict” and “coercive control” are used a lot these days when discussing family court matters. For this matter, I think we will require another category to capture the character and intensity of the level of conflict and control. The phrase “Divide and Rule” describes a method of maintaining control over one’s subordinates or dependents by encouraging and maintaining dissent between them, thereby preventing them from uniting in opposition, or even holding the ruler or person in charge to a reasonable level of accountability. If we combine all of these descriptors, characteristics, and phrases, we arrive at what in my view is the appropriate description of this matter. For this matter, I would describe it as being characterized by “High Conflict, Division, and Control.”

The parties began cohabiting in September 2002 and had two children together: Joshua Renaldo Maciel, currently 21 years of age (hereinafter “Joshua”), and Alexander Cruz Maciel, currently 16 years of age (hereinafter “Alex”). They were married on July 9, 2016, and separated on September 1, 2019. The Applicant wife is Delia Resendes (hereinafter “the Applicant” or “Delia”), who was 25 years old when she met the Respondent. The Respondent husband is Arnaldo Maciel (hereinafter “the Respondent” or “Arnaldo”), who was 45 at the time he met the Applicant.

At the beginning of the trial, the parties advised the court that they had settled the parenting and decision-making issues for their two children by way of final minutes of settlement. As Joshua was already 20 years old at the time of the trial, the minutes briefly summarized the legal status of the remaining child of the marriage, namely Alex, who is 16 years old. The minutes outline the settlement in two sentences, “the parties shall have joint decision-making authority,” and Alex, “shall reside with the parties in accordance with his views and preferences.” Although the children’s issues are not before this court, it is relevant to note the undisputed fact that the children have gone from residing primarily with the Applicant at the time of separation, to residing primarily with the Respondent. It is further undisputed that Joshua has no relationship with the Applicant, and Alex no longer speaks to her. As will be explained later in the decision, the lack of a relationship and lack of contact between the children and the Applicant has, in my view, some minor relevance to my prior comments regarding the high level of conflict, division and control in this matter.

This trial was, on its surface, about some common financial issues that arise in family court (equalization, determination of income, and retroactive and ongoing spousal and child support). However, after over 4 years of litigation, and 12 days of trial, the court was, in actuality, faced with making decisions on complicated issues such as determining the validity (or not) of the Simcoe Group Trust (hereinafter “the Trust”); determining the Applicant’s unjust enrichment claims; determining whether the Respondent had gifted property to the Applicant and later revoked the gift; determining the Applicant’s claims for unequal division of net family property (hereinafter “NFP”); imputation of income to one or both parties; and determining retroactive and ongoing entitlement for child and spousal support and whether to order lump sum support. It is important to note that the pre-eminent issue in this trial was the determination of whether the Trust is valid or whether it is a sham. This issue had to be determined first, as the court’s findings on this issue have a substantial effect on the outcome of most of the other financial issues in this matter.

It is also important to note that this trial was not reached during three prior trial sittings. The approximately two-year delay in bringing this matter to trial contributed to the increased complications and highly conflicted nature of this trial. During the trial, there were literally piles of very large binders containing tens of thousands of pages of documents sitting behind the counsel table. At the end of the trial, there were 123 Exhibits admitted and entered into the record (three of which were expert reports). A voir dire was held regarding the admissibility of one of the reports. The court received 6 large binders of Exhibits containing thousands of pages of evidence. All of this was tendered in the hopes of making the court’s decision on the issues clear and unequivocal. For the most part, under these stressful circumstances, both counsel behaved civilly with each other, with all the witnesses, and with the court. Although the numerous objections and the voir dire interrupted the flow of the trial, counsel are commended for their effectiveness, cooperation, and professionalism in their presentation during the trial. I shudder to think of how this trial would have proceeded if one or both parties were unrepresented.

Issues

The questions the court must answer are as follows:

1. Is the Trust valid or is it a “sham”? Should the Trust assets and debts be included in the Respondent’s NFP for the purpose of calculating the equalization?
2. What is the equalization? Should the court grant the Applicant’s unjust enrichment claim to the property owned by the Respondent prior to the marriage and prior to the Trust being settled? Did the Respondent gift the Applicant a property known as 1113 Lindy Lane, and if so, did he revoke it?
3. Should the court use the Valuation Date or Date of Sale value for the matrimonial home in the Respondent’s NFP? Should the court grant the Applicant’s claim for unequal division of NFP?
4. What is the income of both the Applicant and the Respondent? Should the court impute income to one or both of them for support purposes?
5. What child support is owed, and to whom?
6. Is the Applicant entitled to spousal support? If so, how much? Should it be periodic or lump sum?

Decision

For the reasons set out below, the court finds that the Trust is a sham, and the Trust assets and debts shall be included in the Respondent’s NFP for the purpose of calculating the equalization. For the purposes of calculating the Respondent’s NFP and the equalization, and as a result of the Trust being found to be a sham, the assets and debts held in the Trust shall be included as part of the Respondent’s Date of Marriage and Date of Separation assets and debts. The Applicant’s claim for unjust enrichment to the property owned by the Respondent prior to the marriage and prior to the Trust being settled shall be dismissed. The Applicant’s claim that the Respondent gifted her the property known as 1113 Lindy Lane shall be dismissed. The Applicant’s claim for Date of Sale value for the matrimonial home and unequal division of NFP shall be granted. The court shall impute income to both the Applicant and Respondent for support purposes. The court finds that the Respondent owes the Applicant retroactive child support and lump sum spousal support.

The remainder of the decision, including detailed findings of fact, legal analysis, and the final order, follows as in the original document.

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