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Posts from the ‘Costs’ Category

Judge Hopes “Sting” of Paying Full Legal Bill Brings Warring Couple to Their Senses

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Judge Hopes “Sting” of Paying Full Legal Bill Brings Warring Couple to Their Senses

In a brief ruling on costs in an acrimonious family dispute the court tried to restore focus to the separated parents, who had each incurred $15,000 in legal costs for a set of motions and cross-motions that should never have been brought in the first place.

The parents’ motions related to various issues around spousal support, child support, and payments for extraordinary expenses about which they could not agree.  Even considering that the father came out slightly ahead on the motions overall, the court said his “victory is pyrrhic”.

More importantly, the court said that both parents’ behavior “is in dire need of correction,” given their lack of timely disclosure of income information, lack of true attempts at compromise, last-minute demands of each other, and mutual fixation on items that did not advance the resolution of their issues.  (In illustration, the court pointed out that the parents’ discussion about buying a new $99 hockey stick continued over two months).

In explaining the decision to let the parents each bear their own legal costs on the motions, the court began by observing that the dollar-values being fought over were small:

Relative to the value of the file, it is clear that the parties have lost all sight of proportionality. This motion ought never to have been brought. The value of the issues the parties are fighting over is relatively small. The spread between positions of the parties is $20,658. The net judgment is $4,291.07, in Father’s favour.

The court also noted the avalanche of paperwork that needed to be filed in support of these motions:

In comparison to the value of the matter at issue, the record on this Motion to Change is 5 inches thick, setting aside the material filed for the Refraining Order. For this motion alone the parties filed 5 Affidavits appending 50 multi-paged exhibits. In addition, Father filed a case book and memo of argument.

Nor did the potential toll on public resources go unnoticed:

I have no doubt that each parties’ solicitor and client bill will not be less than $15,000.00. I have not attempted to calculate the cost to the public purse, or the effect that this motion had on the availability of court time for other litigants.

The court concluded:

I hope that the sting of each litigant paying his or her full legal bill without recovery from the other will encourage both parties to attempt to resolve their minor issues without the expenditure of large amounts of their and the public’s resources.

For the full text of the decision, see:

Bolland v. Bolland

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Should Real Estate Downtown Be Factored into Realtor’s Income for Support Purposes?

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Should Real Estate Downtown Be Factored into Realtor’s Income for Support Purposes?

Many of you will know that for child and spousal support purposes, the amount of annual income that a support-payor earns is tied to the amount of support that he or she must pay (although this is subject to other considerations as well).  In a recent Family Law case from B.C. the husband, a prominent and highly- successful  real estate agent, argued that the volatility and uncertainty in the real estate market should be factored into assessing his income for use in his divorce proceedings.

As background:  Under federal divorce and child support law, courts extrapolate a support-payor’s income using the past three years of his or her earnings.  In this case, that amount averaged about $2 million per year. The husband’s realty company – of which he was the sole shareholder – had done extremely well, with 7-year earnings of over $13 million.

Nonetheless, the husband claimed that his past earnings were not necessarily reflective of his future earnings, because of the uncertainty in the West Vancouver real estate market in which he worked.   He predicted an imminent downturn sparked by government’s Foreign Buyer’s Tax (among other things), which in turn would impact his ability to pay support for his former wife of 17 years and for their two children.  Although they had lived a lavish lifestyle in the past, he asked the court to take note of a pending market downturn, and adjust his support obligations in a commensurate manner.

As the court explained his argument:

The [agent husband] argues that it would be devastating to him if his income for support purposes is based on an average of the realty company’s past three years’ net income. He says that the real estate market slowed down from 2016 to 2017 and is likely to slow further down in 2018. He argues that the slow down has been caused by the foreign buyer’s tax, the tightening of residential mortgage insurance rules, and the increases to the Bank of Canada interest rate. The [husband] says these have resulted in a general tightening in the mortgage financing marketplace. Further, he says there is a hesitancy in the real estate market due to uncertainty over what steps the NDP government might take, some of which have been announced since the [husband] swore his affidavit.

The court essentially accepted some – but not all – of the husband’s argument.  It agreed that the upward trajectory of Vancouver-area real estate prices has likely ended, and accepted that the husband had “reason to be pessimistic about the real estate market and hence his income.”

However, the court found it reasonable to conclude that any negative impact has already been felt by now. The court accordingly looked at the husband’s 2017 income figures, together with his income for 2018 thus far, and set the child and spousal support figures accordingly.

For the full text of the decision, see:

Thiessen v Soprovich

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Father Says Kid’s Karate is OK, but MMA is Not; Court Rules on Special Expenses

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Father Says Kid’s Karate is OK, but MMA is Not; Court Rules on Special Expenses

As readers of my Blog will know, under the rules relating to child support in Ontario, parents are obliged to financially support their children, and this duty comes to the forefront when the parents are separated or divorced.

However, there are actually two distinct aspects of that mandatory child support:  1) The one for basic support that is set out in the Child Support Guidelines (CSGs); and 2) the “special or extraordinary expenses” that are allowed for in s. 7 of those same Guidelines.

“Special or extraordinary expenses” are defined to include items such as:

  • Child care expenses incurred as a result of the custodial parent’s employment, illness, disability or education or training for employment
  • The portion of the medical and dental insurance premiums attributable to the child
  • Certain health-related expenses
  • Extraordinary expenses for primary or secondary school education or for any other educational programs that meet the child’s particular needs
  • Expenses for post-secondary education
  • Extraordinary expenses for extracurricular activities

If one parent refuses to agree to pay for a particular special expense, the other parent may have to apply to the court to have a judge make a determination, the legal test being whether it is both “reasonable” and “necessary” in the circumstances.

This was the situation in the very recent case of Newstead v. Hachey, where the court considered whether the child’s Mixed Martial Arts (MMA) training – which the mother had unilaterally enrolled him in – was justifiably a section 7 special expense.   Although the child was also enrolled in Karate, the father thought the MMA training was inappropriate because of its violent focus.  He continued to help pay for it under protest, but asked the court to decide.  The court explained:

While the husband is not happy with certain expenses being incurred by the wife for the children without his consultation or approval, he has not balked at paying.  … He did not agree with the wife’s decision to put [the son] into Mixed Martial Arts.  His view is that while Karate provided a benefit to the child, MMA is different as the only objective of the sport is to hurt or subdue the opponent.  He is afraid that sends the wrong message to [the son], who has had behavioral issues which times included aggression.  Still, despite his protests, the husband is not refusing to contribute to these expenses.

The court pointed out that section 7 of the Guidelines does require the parents to consult or agree to the MMA lessons, but it was a factor the court could take into account in assessing reasonableness:

Section 7 does not specifically require prior consultation for allowable expenses; the test rather is that the expense must be reasonable and necessary.  Section 7(1) of the CSGs says “the court may … provide for an amount”.  The relief, as such, is discretionary.  It follows that a failure or refusal by a claiming parent to discuss the expense with the other parent in advance could bear on the court’s exercise of its discretion in determining whether the expense is reasonable or, for that matter, whether it is necessary.

In the end, the court essentially allowed for the MMA expense to be shared in the overall support calculations, but admonished the wife that she could have those kinds of costs denied in the future simply because she failed to consult with the father beforehand.  The court said:

I encourage the parties and in particular the wife to have these discussions in advance, and simply caution both parties that how they approach future expenditures could impact whether they would be allowed by the court if contested.

For the full text of the decision, see:

Newstead v. Hachey

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Changes to Divorce Act Recommended

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Changes to Divorce Act Recommended

The Canadian Bar Association (CBA), which is the largest professional, nation-wide association for lawyers in Canada, has recently recommended updates to the federal Divorce Act. Put forward by the CBA’s Family Law Section, these suggested changes are aimed at reflecting new realities related to modern-day parenting.
The proposed changes relate to three topics:

• Relocation – Although the test for a court ordering a child to be relocated hinges on the “best interests” of that child, courts are given little guidance on how to apply that test in specific cases. The proposed legislative changes would improve clarity and consistency.

• Child Support in shared parenting situations – The suggested amendments call for the legislation to include a formula for determining child support in shared parenting situations. Currently, the proper approach for courts to apply is complex.

• Updating Divorce Act terminology – The CBA’s proposed changes would see both the Federal Child Support Guidelines and the Divorce Act get updated so that terms such as “custody”, “access” and “best interests of the child” are modernized and replaced with more progressive terms. In particular, the clarity and meaning of the latter term would benefit from incorporating specified factors such as the impact of the child’s cultural, linguistic or spiritual upbringing, as well as the question of whether there is domestic violence in his or her home life.
If for no other reason, from a sheer temporal standpoint this kind of “freshening up” of the Divorce Act is long overdue, since it’s provisions have not been significantly amended for 30 years.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Can Bankrupt Wife Still Claim for Equalization of NFP?

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Can Bankrupt Wife Still Claim for Equalization of NFP?

If a spouse declares bankruptcy, is he or she then prevented from claiming for equalization of Net Family Property (NFP?) under Ontario Family law?

That was the question in Kinsella v. Mills, which involved a couple who had separated after 7 years of marriage. At that point, they signed Minutes of Settlement that finalized the splitting of their financial affairs, which was intended to deal with all issues including spousal support, equalization of NFP and constructive trust claims.  The Settlement reflected the couple’s agreement that the husband would take sole ownership of the matrimonial home and assume all debts and costs, and in return would pay the wife an agreed lump sum, together with a monthly amount.

Less than a year later, the wife declared bankruptcy.  She was automatically discharged nine months later.  The couple’s divorce was formalized a few months after that.

The wife then applied to the court to set aside that Settlement, claiming that it was unfair, signed under duress, and in a situation where she had no independent legal advice and did not know what she was signing. If she was successful, the wife planned to re-launch her claim for equalization of NFP, and wanted it divided unequally in her favour.

The husband resisted, pointing out that after the marriage breakdown he was left with a large amount of debt.  Because of the wife’s bankruptcy, she was released from having to pay it, but he was still saddled with debt that they had rung up together.  Nothing about the Settlement was unfair, in his view.

The court was asked to make a ruling.  It observed that nothing in the Family Law Act or the federal Bankruptcy and Insolvency Act  specifically prevents a spouse from making a claim for equalization of NFP after declaring bankruptcy. However, after examining the interplay between the two, the court concluded that the legislation operated to effectively do so.  The court noted the following:

  • The wife’s claim to any equalization payment from husband fell within the very broad definition of “property” under the bankruptcy legislation.
  • The moment she declared bankruptcy, she was no longer entitled to dispose of or otherwise deal with her property. Instead, it immediately vested in the bankruptcy trustee.
  • Once any equalization claim vested with the trustee – and unless the trustee actually joined the wife in the Family Law proceeding – the wife’s hands were tied.

The court added that this impasse be remedied by the wife being discharged as a bankrupt, but getting the trustee’s consent to go forward, or by firing the trustee.  The Family Court also had no authority to undo the wife’s bankruptcy.

Having found the wife to lack the capacity to bring the equalization claim, the court added that the Settlement itself was not subject to being undone, since there was no evidence of duress.  The wife had also failed to obtain legal advice before signing it, despite being encouraged to do so.

For the full text of the decision, see:

Kinsella v. Mills

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

If You are Divorced in a Foreign Country, Can a Canadian Court Make Orders Too?

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If You are Divorced in a Foreign Country, Can a Canadian Court Make Orders Too?

The facts in Cheng v. Liu are a little unusual, but the core question was this:

If a couple’s divorce is validly granted outside of Canada by a foreign court, does this preclude a Canadian court from later making any corollary orders – such as rulings on issues of support or custody – arising from that same divorce?

The husband, an engineer, was a Canadian citizen who lived in Canada.  The wife lived in China and had never been to Canada.  They got married in China in 2006 and had a daughter who lived with the wife in China her entire life.  They separated about a year after getting married, in around late 2007 or early 2008.

The wife then covered all the legal bases:  She applied in China for a divorce, and custody of their child.  She also applied in Canadian, under the federal Divorce Act, to ask for a divorce, as well as spousal support, child support, and custody.  Finally, also in Canada under the Ontario Family Law Act, she asked for equalization of net family property.

Meanwhile, the Chinese court granted the wife her divorce and awarded her sole custody of the child.  The wife’s other Ontario-based claims were still pending.

The husband, faced with all of these competing actions requiring his response, asked the Ontario court to suspend (or “stay”) the proceedings so that the entire matter could be determined in China.  This led to several rulings and some procedural wrangling, and ultimately a hearing before the Ontario Court of Appeal for its determination.

Against this complicated background the Ontario Court of Appeal had a simple question to consider:  In light of the Chinese divorce order, could a Canadian court make additional orders relating to child support, spousal support, and equalization of property?

The Court’s conclusion was mixed:  The divorce-related issues were closed for consideration, but the child support issues were still up for an Ontario Family court to rule on.

On the first point – and based on longstanding precedent that considered the provisions of the federal Divorce Act – the law states that once the foreign Chinese court had made a valid divorce order, this removes the authority of the Ontario court to hear and determine corollary matters.  So on the remaining divorce-related issues, the Ontario court had no authority.

However, the situation under the provincial Family Law Act was different:  the Ontario court could still rule on questions relating to child support, since the foreign court in China had not already done so in its divorce order.   The Family Law Act allowed child support claims to be made even after a divorce, and the foreign divorce order had no impact on that.  Indeed, the whole purpose for the Ontario legislation was to ensure that parents provide financial support for their dependent children.  Allowing the Ontario court to continuing to make orders under the Family Law Act even though the Divorce Act provisions had been trumped was actually a harmonious outcome to ensure child support would be covered.

For the full text of the decision, see:

Cheng v. Liu

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

 

Thinking of Doing Some Cyber-Sleuthing? Think Again

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Thinking of Doing Some Cyber-Sleuthing? Think Again

I wrote a recent Blog about the admissibility of surreptitiously-recorded telephone conversations in Family law proceedings.  I have also written several times on how courts approach the admission of Facebook evidence.

Particularly in nasty divorce and custody disputes, it is likely that courts will have to grapple with these kinds of issues regularly, given how easy its become for spouses to try to secretly gather evidence against each other, using a Smartphone, keystroke logger, spyware, etc.

But for the average embattled spouse locked in bitter litigation, how effective is this as an evidence-gathering mechanism for use in Family court?

The answer:  Not very.

Under Canadian law, secretly-gathered computer data, emails, internet history, video, audio and similar evidence is generally not admissible in routine Family law hearings, except in unusual circumstances and only after a court has held a separate mini-hearing, called a voir dire, on the specific issue.  Overall, the odds are not very good that such evidence will be admitted.

Case in point:  In a called T. (T.) v. J.(T.) the court considered a situation where the husband had hacked into his wife’s private email, using the password she had allowed him to have when the marriage was in happier times.   The emails disclosed what was, in the court’s words, “an arguably disturbing exchange between [the wife] and her lawyer, which could be interpreted as evidencing some potential risk or threat to his safety.”  Still, the court found the husband’s email hacking was not only unjustified, it was a clear violation of the wife’s privacy rights.  The court also concluded that the email evidence irrelevant and inadmissible.

Similarly, in a decision in U. (A.J.) v. U. (G.S.) the court considered whether to admit evidence that the husband had collected through the use of spyware he had illegally installed on his former wife’s laptop.  The evidence showed the wife’s activities on internet chat rooms, and established that she had engaged in extra-marital sex.  The court examined the issue in the context of the couple’s dispute over custody and access issues, ultimately concluding that the affair and the online activity was out-of-character for the wife, and was not reflective of her ability to parent the children of the marriage.  The court added that it would be “a rare case” that illegally-obtained evidence should be admitted, and only after the trial judge holds a hearing to determine its admissibility.  The burden was always on the party seeking to enter such evidence to establish “a compelling reason to do so.”

For the full text of the decisions, see:

(A.J.) v. U. (G.S.)

(T.) v. J. (T.)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

 

Custody Battle Gone Very Wrong:  Mom’s Cellphone Tracker Shows How Misguided Dad Really Is

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Custody Battle Gone Very Wrong:  Mom’s Cellphone Tracker Shows How Misguided Dad Really Is

I have reported previously about a case called M.M.B. (V.) v. C.M.V., the background facts of which are not terribly unique:  After their split in 2013 the parents had agreed to a “parallel parenting” and equal-time arrangement for their three children.  The mother now claimed that in the time since, the father had been engaging in a concerted effort to alienate her from them.  She asked for sole custody and an order that the father undergo therapy.

What’s more noteworthy is the rather epic court ruling in their case, which spanned over 1200 paragraphs, where the court recounted a dizzying array of tactics by each of the parents; overwhelmingly, however, the ruling focused on the misconduct of the father, who the court repeatedly noted had viewed himself as being “in a war” with his former spouse and determined to “win” at all costs.

Among the many accusations of rather mind-boggling misconduct on his part, one of the more interesting ones involved him using an app installed on the mother’s own cell phone to “track” her location.  As the court explained the gist of the mother’s testimony:

During the last two years of the relationship prior to separation, her evidence is that the [father] became more volatile and threw things at or near her. The [mother] testified that he was obsessed with the idea that she was having an affair. Her evidence is that she had never had an affair during the marriage.

 She further testified that the [father] had a constant need to be “in control” and that he utilized a feature on her cell phone to be able to track her whereabouts. Two examples that she cited were, on one occasion when she attended at a lawyer’s office in July 2011, he telephoned her four times during her appointment with the lawyer, knowing exactly where she was at the time. The second example she gave happened in August 2011. They were in New York for a few days and she left early to return to school. While the [mother] was still in New York, she claims that he was able to track her whereabouts and knew that she had taken a different route home. She says that she did so in order to look at possible housing for her and the children. He accused her that she was travelling to a residence for purposes of having an affair.

 As further proof that he was tracking her whereabouts through her cell phone, she indicated that she, as a result of these situations, learned that there was a “track my phone” feature on her phone which she then disabled. Shortly thereafter, however, she testified that he insisted on having her cell phone for some unrelated purpose. When he returned it to her she noticed that that the tracker had been reconnected. …

 When asked about the allegation of tracking the [mother] on her cell phone, his explanation for his knowledge of her going to a lawyer is that their cleaning lady told him this in July 2011 when the [mother] was going to the lawyer.

 When asked about the feature of “find my phone” so that he could allegedly track her whereabouts from his phone, he has a very “plausible” explanation. He claims that because he was using his phone for Association work they jointly downloaded this app so that she would be able to find his phone in the event that he lost it.

 Regarding the knowledge that he had that the [mother] was on a different route on the way home from New York City, the [father] once again has a “plausible” explanation. His brother who is a real estate agent, by happenstance, was showing a house across the road from where the [mother] was driving. His brother took it upon himself to call the [father] to report that he had seen his vehicle, thinking that it was the [father] but of course it was the [mother].

 This court views each of these explanations with a great deal of cynicism.

That cynicism was borne from many other conflicting and incredible explanations by the father, including one piece of “smoking gun” evidence noted by the court several hundred paragraphs later:

In response to the [mother’s] concern that the [father] was tracking her and the children’s whereabouts, the [father’s] response is somewhat contradictory. On the one hand, he “denied this” and stated that he “doesn’t care where she goes”. On the other hand, on several occasions, he admitted to “wanting to locate the children and not her”, which he believes to be a safety issue. He said he ”was able to locate the children by their cell phone devices”.

 This was an admission by the [father] that the court finds is consistent with the evidence given by the [mother] at trial; that she knew that the [father] was tracking her movements through her cell phone. The court finds that this is inconsistent with the [father’s] “explanations” of how he knew the [mother’s] whereabouts on two separate occasions at about the time of the separation. He specifically denied under oath at trial that he was tracking her whereabouts through her cell phone. Undoubtedly, he had forgotten what he said during the assessment, or did not expect this court would take the time to read all of the exhibits.

Particularly as it relates to the father’s highly misguided win-at-all-costs focus, the M.M.B. (V.) v. C.M.V. decision is a virtual judicial textbook on “How Not to Behave” in the post-separation phase.  It could be interesting reading for those who can get through the 1,200-paragraph judgment.

For the full-text of the decision, see

M.M.B. (V.) v. C.M.V.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com