Court File and Parties
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Jennifer Barlow Reid, Applicant
AND: David Chad Kulchyski, Respondent
BEFORE: Justice Carolyn Leach
COUNSEL: Christopher Sweeney, for the Applicant Elissa Boyle, for the Respondent
HEARD: January 20, 2026
Endorsement
1This is the Applicant’s motion for:
a. the release of $161,770 from the proceeds of sale of the matrimonial home held in trust by the parties’ real estate counsel on behalf of the Applicant;
b. the release of $250,000 from the proceeds of sale held in trust by the parties’ real estate counsel on behalf of the Respondent as an advance equalization payment; and
c. reimbursement for section 7 expenses in the amount of $48,753.
2The Respondent denies that the Applicant is entitled to the release of the funds held in trust and submits that her claim for retroactive s. 7 expenses is premature. He seeks an order dismissing the motion in its entirety.
Issues to be Determined
3The issues I must determine on this motion are:
a. Should funds be released to the Applicant from her share of the proceeds of sale of the matrimonial home?
b. Should an advance equalization payment be made to the Applicant from the Respondent’s share of the proceeds of sale?
c. Should an order for retroactive payment of section 7 expenses be made at this interim stage of the proceedings?
Background
4The parties were married on August 26, 2000 and separated on January 25, 2024. They have four children, now ages 23, 20, 18 and 15. The 23 year old and the 15 year old live with the Applicant full-time. The two middle children are in university and live with the Applicant when they are not in school.
5The Applicant is an interior designer. When the parties separated, she operated her business through a corporation, Barlow Reid Inc. In early 2025, the corporation filed for bankruptcy. The Respondent is a contractor. He is a shareholder and employee of two corporations through which he operates his business, Douglas Reid Renovations Inc and Douglas Reid Realty Inc.
6The matrimonial home was sold on December 5, 2024. The parties retained Levy Zavet PC as their real estate counsel for the sale. After closing fees and the discharge of mortgages and other charges, the proceeds of sale were approximately $1,300,000. These funds were held in trust with Levy Zavet PC, with approximately $650,000 earmarked for each party at the outset.
7Over the following months, the parties each received interim disbursements from the funds held in trust. In broad strokes, in January 2024, each party received $150,000 plus an additional $20,000 to $40,000 (the parties each set out different figures in their materials). In August 2025, following a DRO conference, the Applicant received a further disbursement of approximately $315,000 and the Respondent received a further disbursement of approximately $115,000. According to the Applicant, the balance remaining in the trust account for the Applicant is $161,770. The balance remaining for the Respondent is approximately $350,000.
8After the matrimonial home was sold, the Applicant entered into a residential lease agreement commencing December 1, 2024, with a fixed term requiring her to vacate the property in February 2026. She deposed that while this was not ideal, the market was tight at the time and she was required to find a home for herself and the children very quickly. She has attempted to extend the tenancy, but her landlord has refused as the property is scheduled to be demolished.
9In November 2025, the Applicant and her partner entered into an agreement of purchase and sale for a residential property, with a scheduled closing date of January 30, 2026. The purchase price of the property is $1,545,000. They have secured financing for $1,100,100 and have paid a deposit of $100,000. The Applicant states that she requires $400,000 to close the purchase. She also says has no savings to draw upon to make up this shortfall.
10For this reason, the Applicant seeks the release of her portion of the remaining funds held by Levy Zavet PC and an advance on her equalization entitlement of $250,000 from the Respondent’s portion of the funds. The Applicant further seeks reimbursement from the Respondent of 65 percent of the s. 7 expenses that she has incurred on behalf of the children since the date of separation.
Issue One: Should funds be released to the Applicant from her share of the proceeds of sale of the matrimonial home?
11The Respondent opposes this relief.
12Section 12 of the Family Law Act, R.S.O. 1990, c. F.3 provides:
In an application under section 7 or 10, if the court considers it necessary for the protection of the other spouse’s interests under this Part, the court may make an interim or final order,
(a) restraining the depletion of a spouse’s property; and
(b) for the possession, delivering up, safekeeping and preservation of the property.
13As title to the home was held jointly, the Applicant is presumptively entitled to half of the proceeds of sale: Afshar v. Mahmoodi, 2016 ONSC 2875, at para. 31. If a party resists the release of funds under s. 12 of the Family Law Act, that party has the onus to show why a preservation order should be made: Godfrey v. Godfrey, 2019 ONSC 3093, at para. 15.
14Accordingly, there must be some evidence to convince me that it is necessary to preserve the Applicant’s property in order to protect the Respondent’s interest in an equalization payment.
15The Respondent, however, is not asserting that the Applicant’s share of the proceeds of sale should be preserved to secure his interest. Indeed, on close review of his materials, he does not appear to dispute the fact that she will likely be entitled to an equalization payment. The issue is the quantum of that payment. Rather, his position is that if her share is fully paid out, then he should be entitled to disbursement of the same amount from his share. He points out that the Applicant has already received $200,000 more than he has in interim disbursements.
16I am not satisfied that it is necessary to preserve the Applicant’s share of the net proceeds of sale in order to protect the Respondent’s potential interest in an equalization payment. I am also not convinced that the release of the Applicant’s funds should be conditional on the release of equivalent funds from the Respondent’s share. The two issues are separate.
17Accordingly, the Applicant’s request for the release of the balance of her funds held in trust is granted.
Issue Two: Should an advance equalization payment be made to the Applicant from the Respondent’s share of the proceeds of sale?
18The Applicant seeks an advance equalization payment of $250,000 from the Respondent’s share of the proceeds of sale. The Respondent opposes this relief.
19As noted by McGee J. in Stork v. Stork, there is no statutory basis upon which a court may order one party to pay the other a sum as an advance on a claim for an equalization payment: 2015 ONSC 312, 55 R.F.L. (7th) 448, at para. 15. Starting with Zagdanski v. Zagdanski, 2001 27981 (ON SC), [2001], 55 O.R. (3d) 6 (S.C.), a line of case law has established that an advance may be ordered based on the exercise of the inherent jurisdiction of the court. Further to para. 27 of Stork v. Stork, the factors upon which an order for the advance of monies towards an equalization payment ought to be made are:
a. There is certainty that the person seeking the advance will receive an equalization payment of at least that amount;
b. There is a need and a reasonable requirement for the funds; and
c. It is just and fair to both parties to do so in the circumstances.
20The key question in this case is whether there is certainty that the Applicant will receive an equalization payment of at least $250,000. As Lane J. noted at para. 40 of Zagdanski “what is happening here is simply an advance of the applicant’s own money.” In my view, an advance cannot be made where the requisite certainty does not exist. For the reasons below, I am not satisfied that the Applicant has established that she will almost certainly receive an equalization payment of at least $250,000.
Positions of the Parties
21In calculating the potential equalization payment, the Applicant relies upon on a financial statement the Respondent swore on July 14, 2025 at the outset of the litigation, and an initial valuation of his corporate interests, she concludes that the Respondent’s Net Family Property (NFP) is approximately $1,300,000. When set against her NFP of $661,030 (based on her most recent financial statement), this would yield an equalization payment of about $330,000. In the Applicant’s view, this is the minimum equalization payment that she will be entitled to; once further valuations are conducted of the Respondent’s assets, she expects that the equalization payment will rise significantly.
22The Respondent states that the Applicant has exaggerated the potential equalization payment. He relies on the NFP calculation in his most recent financial statement sworn on January 14, 2026, which incorporates the final valuation of his corporate interests. In this financial statement, he states his NFP to be $735,823.63. The Respondent further asserts that the Applicant has not yet produced relevant disclosure to support her calculation of NFP and that there are a number of post-separation adjustments that must be considered. In sum, his position is that there is considerable doubt that any equalization payment owed to the Applicant will exceed the $250,000 advance she seeks.
Calculation of the Respondent’s Net Family Property
23In argument, the Applicant raised a preliminary issue about the approach taken by the Respondent in his January 14, 2026 financial statement. In Part 5 of the statement, the Respondent lists a shareholder loan owing to Douglas Reid Renovations Inc. as one of his sole debts. On the valuation date, the value of this loan is stated to be $458,935. The current balance of the loan is approximately $53,000. The loan is characterized as “borrowed funds from Douglas Reid Renovations Inc. by parties towards joint household expenses post-separation, section 7 expenses, and other miscellaneous items”. Douglas Reid Renovations Inc is one of two corporations that the Respondent uses to operate his business. He holds 51 percent of its shares. In submissions, counsel for the Applicant advised that this loan was advanced by the corporation days before the couple separated.
24The Applicant asserts that the Respondent has failed to properly account for this loan in the financial statement and accordingly has understated his NFP. Notably, the financial statement does not identify where the loaned funds were deposited. In submissions, counsel for the Respondent advised that the funds were deposited into the parties’ joint account and then applied against the parties’ joint line of credit. I note that while both parties referenced the line of credits on their financial statements (each describing a balance of over $400,000 on valuation day), neither party actually accounted for it when calculating their valuation date debts and liabilities.
25Both counsel state that since the separation, both parties have made incremental payments towards the loan. Counsel for the Respondent states that this issue can be addressed when post-separation adjustments are calculated.
26I agree with counsel for the Applicant that the way in which the loan is addressed in the Respondent’s financial statement artificially depresses his NFP. The Respondent deposes that the Applicant agreed to repay part of the loan as it was to cover family expenses. If the parties were jointly liable for the loan, then the Respondent should have declared only his 50 percent share as a debt. Alternatively, if he was the only party actually liable for the shareholder loan, but his position was that the Applicant was responsible for 50 percent of its repayment, then the Applicant’s 50 percent share should have been characterized as an asset he owned on the valuation date in Part 4(f): Money Owed to You section of his financial statement. Under either method, the Respondent’s NFP increases by $229,467.40 When added to his current NFP of $735,823.63 and brings his total NFP to $965,291.03.
27To mirror this approach, the Applicant’s NFP must also be calculated in a manner that takes the loan into account. This would increase the Applicant’s valuation date debts and liabilities by $229,467.40, and thus reduce her NFP to $431,562.60.
Analysis
28Based on the above, the resulting equalization payment would be $266,864.21. This amount exceeds the $250,000 advance that the Applicant seeks by a very slim margin. It is also the best-case scenario for the Applicant, as it rests on an assumption that the parties each bear equal liability for the loan. There is no evidence as to what portion of the loan the Applicant agreed to repay.
29I am not persuaded that the actual equalization payment that will be owed is likely to be higher than $266,864.21. There is simply not enough information to allow me to make that determination. The Applicant disputes the Respondent’s business valuator’s conclusion that the combined value of both corporations is $396,700. The Applicant expresses confidence that once a proper expert evaluation has been completed, the values of these corporations will be significantly higher and the resultant equalization payment owed to her will be closer to $800,000. However, there is no evidence before me to support that contention.
30Further, there are a number of financial issues that remain in dispute. The Respondent’s evidence is that he has received only partial financial disclosure from the Applicant and accordingly cannot properly evaluate her declared NFP. Some of the items in dispute include: the value of the Applicant’s corporation on the date of separation (the Respondent questions the Applicant’s contention that it was insolvent); whether that corporation was jointly owned by the parties or solely owned by the Applicant; the value of artwork, furniture and jewellery retained by the Applicant after the separation; and an alleged unfulfilled commitment by the Applicant to pay the Respondent $15,833 from her 50 percent of the net proceeds of sale on closing of the transaction.. The Respondent states that he and the Applicant continued to comingle their finances after separation and that there are numerous expenses that arose after the date of separation that must be reconciled. He has also claimed an unequal division of net family property on the basis that the Applicant recklessly depleted assets during the marriage.
31I am unable to determine whether there is any merit to the Respondent’s allegations. However, based upon my review of the conflicting affidavit material, I am not satisfied that there is a certainty, or almost certainty, that the Applicant will be entitled to an ultimate equalization amount of at least $250,000.
32Further to Stork v. Stork, the next factor that I must consider is whether there is a need and a reasonable requirement for the funds. I accept that the Applicant requires additional funds to close on the purchase of her new home and that there could be significant consequences if she is not able to do so. The difficulty is that she is asking to be advanced funds to which she does not have a clear entitlement. I also accept that it would be best for the children if there were a clear plan for where they will reside after January 30, 2026. Regrettably, this does not change the fact that the Applicant may have entered into an agreement to purchase a home that she could not afford.
33The final factor to consider is whether it is just and fair to both parties to advance the funds in the circumstances. If there was the requisite degree of certainty that the Applicant would be entitled to an equalization payment exceeding $250,000, I would have no difficulty concluding that it would be just and fair to advance the funds to allow her to purchase this home. In the absence of that certainty, I must conclude that it would be unjust and unfair to the Respondent to pay out his portion of the net proceeds of sale to the Respondent when there is a possibility that, ultimately, she will not be entitled to the portion of these funds.
34The Applicant’s request for an advance is therefore dismissed.
Issue Three: Should an order for retroactive payment of section 7 expenses be made at this interim stage?
35The Applicant states that she has incurred approximately $96,066.65 in s. 7 expenses for the children as of the date of separation. She seeks an order requiring the Respondent to reimburse her in an amount proportionate to their respective incomes. Her sworn affidavit attaches an excel spreadsheet setting out a variety of different expenses. It is not possible to discern from this document whether all of these expenses would fall within the six enumerated heads of relief under s. 7.
36The Respondent’s evidence is that many of these claimed expenses may have been paid when the initial disbursement was made in January 2025 from the proceeds of sale of the matrimonial home. He also states that he himself has paid for s. 7 expenses that also must be split between the parties. The Respondent has requested receipts to back up the expenses, which is reasonable as the Applicant has not provided these receipts to date.
37In my view, there are too many unresolved factual issues for me to make a retroactive order with respect to the payment of s. 7 expenses. This is a matter that should be dealt with at trial.
ORDER
38For the reasons above, I order that the Applicant, Jennifer Barlow Reid, shall be entitled to the release of $166,587.31, representing the balance of her portion of the net proceeds of sale of the former matrimonial home, being held in trust by Levy Zavet PC.
39The balance of the relief sought on the motion is dismissed.
COSTS
40If either party wishes to pursue a claim for costs in connection with this motion, they may serve and file written submissions in accordance with r. 24(19) of the Family Law Rules.
Justice Carolyn Leach
Date: January 23, 2026