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Posts tagged ‘Blatherwick v. Blatherwick’

Judge Laments a Litany of Lies

liar

Judge Laments a Litany of Lies

Have you ever wondered what it’s like to be a Family Law judge tasked with the job of finding the truth?

The recent Ontario decision in Blatherwick v. Blatherwick illustrates the challenges and frustrations inherent in that job. The couple had been married for just under 40 years. In 1999, they started what turned into a highly successful business in Canada selling Hallowe’en costumes all over the world. After they separated in 2010, the only legal issue for the court related to spousal support and equalization, both of which required an assessment of the husband’s finances. This in turn necessitated analysis of a complex web of multiple key corporations, numerous related companies, and several offshore corporations in which the husband was involved.

The judge lamented the overall course of the litigation this way:

By the time this matter got to trial, these issues were reduced to two highly contentious issues: What is [the husband’s] income? What was the value of his corporate interests at the time of separation?

Four and a half years of litigation, over $2,000,000 in legal and expert fees, and the answer to these two questions are not capable of precise determination. Why?

The judge went on to catalogue in detail the various reasons:

The first is that [the husband] admits there is a “brotherhood of trust” amongst him and his partners in the Seasons Halloween Business. This brotherhood of trust “looks after each other”. During his cross-examination [the husband] responded as follows:

Question: “In the event that one of you get into trouble in matrimonial proceedings, your partners quickly come to the rescue?”

Answer: “Yes”.

The husband had also engaged in “deliberate and flagrant disregard for any and all court orders”, according to the judge, and was “not deterred from pressing on to do whatever he pleased regardless of whether he knew it continued to breach a court order.”

Next, the judge pointed out that the husband was less-than- truthful, and his evidence shifted freely, to suit the circumstances:

The second [reason] is that [the husband] admitted he was a liar and a cheat before Justice Lemon. He was asked at trial whether he conceded at trial that he is a liar and a cheat and carries on business with partners that are the same. His answer was “I concede that”. …

[The husband’s] evidence changed, dramatically and on significant issues, regardless of whether his prior positions were in writing or under oath. Nothing short of fundamental changes in position of cataclysmic proportions were announced by [the husband] at trial. …

The obfuscation of the facts by [the husband] began. Suspension of reality was a phrase that continually came to mind during the evidence.

The difficulty of the judge’s task was also amplified by the nature and scope of the corporate interests held by the husband, and his unwillingness to be forthright about them:

[T]he companies which form the Seasons Halloween Business are located in China and the BVI. Complete financial disclosure was not produced by [the husband]. The little corporate documents that exist are entirely unreliable. [The husband’s] excuses for the lack of disclosure of many documents were fanciful and unbelievable. [The husband] decided to engage in a “catch me if you can” game.

Finally, the judge summed up the source of its frustration this way:

At the end of the trial, it is clear that [the husband] has, and continues to earn, or has available to him, a substantial income. Clearly, [the husband] had no desire to part with a reasonable amount of his income to [the wife] as support. He has gone to great lengths to hide his real income.

At the time of separation, [the husband] corporate interests in the Seasons Halloween Business were complex, stretching from China to the BVI, with sales through many countries in the world. These corporate interests had and have substantial value.

These corporate interests generated and continue to generate large profits for the partners.

[The husband] threatened his wife that she would not be able to “get at” his offshore business interests. He has done everything he can to carry out that threat.

Do you sympathize with the judge’s plight in trying to uncover the truth, when faced with a litigant who is determined not to reveal it? What are your thoughts?

For the full text of the decision, see:

Blatherwick v. Blatherwick, 2015 ONSC 2606, 2015 CarswellOnt 6124

 

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 www.RussellAlexander.com

Is $62,000 in Temporary Monthly Spousal Support Reasonable?

Is $62,000 in Temporary Monthly Spousal Support Reasonable?

In a recent Ontario decision called Blatherwick v. Blatherwick, the court had to consider whether a wife’s existing temporary spousal support – currently at $12,000 per month – should be increased by another $50,000 per month.

The couple had been married for 29 years and had three children in what was a traditional marriage. The husband had been a successful businessman, while the wife stayed at home to care for the children. After separating, they commenced the process of negotiating and untangling their financial affairs, which included an equalization payment of over $1 million to the wife (almost half of which had already been paid to her as an advance) and temporary spousal support payments by the husband to the wife of about $12,000 per month, pending final resolution of the issues at trial.

However, the wife brought an interim application to the court, asking for increased support. Although the husband acknowledged that the wife was entitled to some spousal support, he did not agree with the amount she was seeking – namely $62,000 per month instead of the $12,000 per month he was currently paying.

The wife had arrived at this spousal support figure based on the assertion that (according to her expert) the husband was likely earning an estimated $1.5 million per year in income. This estimate was necessary because the husband had not been particularly forthcoming on the actual figures: Indeed, he had not only been evasive, but by his own admission he had submitted various conflicting and inaccurate income figures to the court, to Canada Revenue Agency, and to Citizenship and Immigration Canada. On this aspect, the motions judge observed:

In order for Mr. Blatherwick’s position to be upheld at trial, not only will he have to be believed but his various business partners will also have to be believed. Given his credibility as conceded above, I need not set out the litany of inconsistencies and dubious documentation proffered by both he and his business partners. This must be left to the enjoyment of the trial judge.

The motions judge then turned to the merits. First of all, the judge observed that although the Spousal Support Advisory Guidelines do not apply once a paying spouse’s annual income exceeds the $350,000 mark, this does not mean that there is a “cap” on the amount of spousal support that can be awarded once that income level is reached. Rather, the Guidelines provide a range of spousal support for the court to consider, depending the parties’ circumstances, need, and ability to pay.

The judge also pointed out that in considering temporary spousal support applications, there is a presumption that the separated spouses should enjoy an equal standard of living and should enjoy a similar lifestyle pending the final resolution of their issues.

Here, the proceedings were in an early stage and the motions judge had to consider the factual evidence as was currently available. After looking at all the facts (and after making further comment on the husband’s “admitted lack of credibility”) the judge imputed to the husband an annual income of $463,000, and increased the wife’s temporary spousal support so that she would receive $20,000 per month. In doing so, the judge observed that the wife “can clearly make ends meet on this amount.”

For the full text of the decision, see:

Blatherwick v. Blatherwick, 2012 ONSC 3606  http://canlii.ca/t/frsxd

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 www.RussellAlexander.com.