In a very recent family law case, the Ontario Court of Appeal criticized the trial judge’s decision for being inadequate and incomplete in several important respects, and proceeded to make its own Order as to child and spousal support payable.
In this case, the spouses were married for 18 years, and had three children. During the marriage the husband was self-employed as a commercial real estate broker and the wife took care of the children.
After they separated in 2006, they signed a separation agreement obliging the husband to pay a blanket $10,000 per month, as an undifferentiated amount to cover both child and spousal support. A review would take place after two years. In the meanwhile the wife had taken a job as a secretary and was earning about $45,000 per year.
When the two years had expired, the husband instigated the review process but the parties were unable to reach a mediated settlement despite several attempts. They brought the matter court to have their matter resolved.
At the trial, the judge found that the husband had both misled the wife as to his income when they signed the separation agreement, and also failed to accurately disclose his income afterwards for the review process. Still, the trial judge adopted what the husband proposed as a “compromise”: the husband would keep paying the $10,000 per month, but it would notionally be allocated as $2,000 for child support and $8,000 for spousal support.
The trial judge made the Order accordingly; however, the husband later appealed it to the Court of Appeal. He claimed that trial judge’s reasons provided insufficient explanation as to how the appropriate support level – which the husband himself had proposed – had been determined.
The husband’s appeal was successful. First of all, the husband’s “compromise” approach was not a proper foundation upon which the trial judge should have made the child support or spousal support award, since it overvalued spousal support and undervalues child support without any reason or explanation for doing so.
More importantly, the Court of Appeal decided that the trial judge’s reasons for judgment were entirely deficient, in that they:
• failed to explain the proper basis for the support orders made;
• failed to provide justification or explanation for the gap between the $2,000 a month for child support, and the generous $8,000 monthly spousal support award;
• made only general findings about the husband’s income, and didn’t even specify what he determined that income to be;
• failed to provide any justification for departing from the Child Support Guidelines; and
• failed to provide any reason for refusing to apply the Spousal Support Advisory Guidelines.
The Court of Appeal did note that the trial judge had strongly disapproved of the husband’s behaviour during trial, and the fact that he had been under-reporting his earned income and was earning less in commercial real estate than he was capable of. Nonetheless, none of this excused the trial judge’s failure to provide a properly-reasoned legal basis for the award.
Rather than send the matter back to trial, the Court of Appeal went on to determine the proper support amount. In light of the husband’s dishonesty and lack of financial disclosure, the Court attributed an annual income of $250,000 to him. Based on that income level, and applying the Child Support and Spousal Support Guidelines, child support was increased to $4,000, but spousal support was reduced to $4,500.
The Ontario Court of Appeal’s decision in Gagne v. Gagne, 2011 ONCA 188 can be found at: http://bit.ly/fdec5H