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When Can You Vary a “Final” Spousal Support Order on an Interim Basis?

 

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When Can You Vary a “Final” Spousal Support Order on an Interim Basis?

The name itself suggests finality:  A Final Order for spousal support.  But under Canadian divorce law, even a Final Order can be changed by the court, if there are new facts that warrant it.  This typically takes place by one of the spouses bringing a Motion to Vary.

However, in some limited circumstances a Final Order can be changed on an interim basis – meaning even before a Motion to Vary can be heard.   The precise circumstances in which this can take place was the focus of a recent Ontario decision called Berta v. Berta.  The court introduced the background this way:

This has been an unhappily lengthy and contentious proceeding. It has been ongoing since 2010. The court file now comprises 21 volumes of the continuing record. That record is stored in seven banker’s boxes, requiring two large carts to haul it into court. There have been numerous motions and trips to the Ontario Court of Appeal in this and related proceedings.

The result of all that paperwork, as well as 9 days of trial time, was that the husband had ultimately been ordered by way of a Final Order for spousal support to pay his wife about $13,800 a month, based on his income which was imputed to be about $645,000 per year.  He had also been ordered to pay the wife $322,125 in costs.  However, he had paid only $73,000 toward that amount so far, and the support arrears alone totalled $480,000.

Instead of paying the rest, the husband applied to the court on an interim basis for an order requiring him to pay only $1,129 per month, until such time as a full Motion to Vary could be heard.  He based this request on numerous grounds amounting to a material change in circumstances, including a downturn in his business, health considerations, the loss of two key clients in his business, and what he called his wife’s “misconduct” in forcing him to buy out her shares in their jointly-owned business.

The wife countered by stating (among other things) that the husband’s business still earned enough net income to pay the full amount of monthly support – he just chose not to pay.  Plus, the husband had not come to court with “clean hands”:  He was currently in arrears, and had not complied with previous court-ordered disclosure, in one case taking 22 months to provide only partial documentation.

This factual background gave the court the opportunity to conclusively establish the proper legal test for varying a Final Order for support on an interim basis, under Canadian Family Law.   After reviewing the various thresholds that had been used by courts in the past – and while adding that the interim variation of Final Orders should not be routine – the court concluded that it could make such an order in this case if the wife makes out a “clear case for relief”.  The relevant factors include:

  1. A strong prima facie case;
  2. A clear case of hardship;
  3. Urgency;
  4. That the moving party (in this case, the husband) has come to court with “clean hands”.

Applying these tests, the court found the husband had simply not made out a case for an interim order.  In particular, he had not demonstrated even a prima facie case around his alleged decline in business earnings and other financial circumstances – let alone a “strong” one.  There was no evidence that the wife had engaged in any misconduct relation to the forced sale of shares, and the price he received was fair.  His claim to be suffering from various health problems was without proof. He also had not demonstrated any urgency, nor that he would suffer any hardship if he had to keep complying with the original Final Order.  The question of “clean hands” was unnecessary to decide, in light of the shortcomings in meeting the other parts of the test.

The court dismissed the husband’s motion.

For the full text of the decision, see:

Berta v. Berta, 2019

Related Article: The Finer Points on Court-Ordered Interim Support

At Russell Alexander Collaborative 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

 

What Constitutes “Hardship” When You Are Well-to-Do?

What Constitutes “Hardship” When You are Well-to-Do?

In determining the proper amount of spousal support that should be awarded after a married couple divorces, the court is guided by various established legal and policy-based principles. One of them is that the support should seek to alleviate economic “hardship” on the part of the spouse who is entitled to receive it.

As with many of the other factors, the concept of “hardship” is relative:  What amounts to hardship in one family setting will be vastly different to what is considered hardship in another.

This dichotomy was well-illustrated in Plese v. Herjavec, which involved the high-profile divorce between Canadian television personality Robert Herjavec (most recently seen on the reality shows Shark Tank and Dragon’s Den) and his wife of 24 years, Diane Plese.

In the context of determining the appropriate amount of spousal support to which the wife should be entitled, the court wrote:

Spousal support is also designed to relieve economic hardship.  What is “hardship” in the context of this family?  I need to look at the pre-separation lifestyle of the family to understand this context.

At the date of separation, the parties lived in a 22,000 square foot home (not counting the basement) with an indoor pool, ballroom, tennis court, tea house, and ten-car garage housing numerous luxury vehicles. The home was located on more than 2 acres in one of the most exclusive areas of Toronto.  The parties owned a ski chalet in Caledon, a luxurious vacation property in Florida, boats and other water craft and a Muskoka cottage.

The former couple’s lifestyle was commensurately extravagant, as the court described:

The family travelled extensively.  Family holidays were often taken using THG’s private jet, which Ms. Plese described as one that can fly “over the ocean”.  Holidays included European destinations.  On a holiday in Greece, the parties rented a yacht and staff to sail the family around the Greek Isles.  Ms. Plese testified that if the aircraft was being used for THG business, and she wished to take a trip, Mr. Herjavec would charter a private plane for her.   Mr. Herjavec did not refute this evidence.

Ms. Plese’s financial statement shows she owns considerable expensive jewellery from Cartier.  At valuation day it was worth over $428,000.  Ms. Plese says this figure reflect roughly half of what it cost.  Again, I heard no evidence to the contrary.

Mr. Herjavec testified he spent $100,000 on a piano for High Point, but, since no one in the family could play, invested a further $25,000 on a device that would play the piano.  Mr. Herjavec owned and operated numerous luxury cars. The middle child, Skye, received a car for her 16th birthday.  The children were educated at exclusive private schools.  The two girls attended elite American universities.  Both older children have pursued post-graduate studies, at no personal financial cost to them.  The family lived a rarified existence of privilege and luxury.

It is telling that [their daughter] Skye, when asked whether it was true she enjoyed luxurious holidays with her family, simply answered:

I mean they were just vacations to me, I don’t – it depends on how you see them.

Skye was then asked how she saw them. She answered:

I was going on vacation with my family … it depends what you – like that’s how I grew up, that’s – it was a vacation with my family is how I saw it.

In awarding support, the court had to examine the post-split downgraded lifestyle that the wife was now living, in light of the divorce after a longstanding marriage.  The court explained:

Ms. Plese testified that her lifestyle has suffered since the breakdown of the marriage.  For example, instead of travelling by private jet, she flies with commercial airlines.  Instead of staying in a suite of rooms at luxurious hotels, she now stays in a single hotel room.   I have no evidence that Mr. Herjavec has experienced any similar reduction in his lifestyle.

I conclude that without spousal support, Ms. Plese will have suffered economic hardship as a result of the end of the marriage.

For the full text of the decision, see:

Plese v. Herjavec, 2018 

At Russell Alexander Collaborative 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

What is the Resolution Evolution – the Path to Peace?

What is the Resolution Evolution – the Path to Peace?

The Resolution Evolution – the Path to Peace is an OCLF/OAFM Conference and your opportunity to take advantage of world-class training close to home, to meet and network with other collaborative professionals, and to socialize with our professional colleagues.

The conference will run May 2, 3 & 4, 2019 at the Brookstreet Hotel, Ottawa, Ontario.

To register or learn more, click here.

Are Some People Genetically Destined for Divorce?

Are Some People Genetically Destined for Divorce?

Some surmise that children of divorce may experience a greater chance of divorce when they grow up because of their environment. Recent studies and news reports suggest that when it comes to divorce history may indeed repeat itself but not for the reasons you may think.

Studies and prior literature emphasized that divorce was transmitted across generations psychologically and as a result of environmental factors.

However, recent studies  “contradict that, suggesting that genetic factors are more important.”

Jessica Salvatore, Ph.D. reports that:

The study’s findings are notable because they diverge from the predominant narrative in divorce literature, which suggests that the offspring of divorced parents are more likely to get divorced themselves because they see their parents struggling to manage conflict or lacking the necessary commitment, and they grow up to internalize that behavior and replicate it in their own relationships.

[The study] analyzed Swedish population registries and found that people who were adopted resembled their biological — but not adoptive — parents and siblings in their histories of divorce.

By recognizing the role that genetics plays in the intergenerational transmission of divorce, therapists may be able to better identify more appropriate targets when helping distressed couples, Salvatore states:

“At present, the bulk of evidence on why divorce runs in families points to the idea that growing up with divorced parents weakens your commitment to and the interpersonal skills needed for marriage. So, if a distressed couple shows up in a therapist’s office and finds, as part of learning about the partners’ family histories, that one partner comes from a divorced family, then the therapist may make boosting commitment or strengthening interpersonal skills a focus of their clinical efforts.”

So how does free will and fault play into divorce in light of these findings?

In Ontario, we operate a no-fault divorce process:

Under the Divorce Act, you do not need to prove that your spouse was at fault in order to get a divorce. If the reason you are asking for a divorce is marriage breakdown, shown by one year of living apart, either of you can request a divorce. It does not matter which one of you decided to leave. In fact, the law gives you the choice of applying to the court together to ask for a divorce.
However, if the reason you are asking for a divorce is marriage breakdown because of adultery or mental or physical cruelty, you will have to have proof of what happened.

As a result, someone’s genetic disposition, as it relates divorce, will not shape the outcome of the divorce proceeding. But as Dr Salvatore’s study suggest, this information would be helpful in therapy and focusing clinical efforts on boosting commitment or strengthening interpersonal skills.

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.

Is $122,858 USD a Month Enough to Live On?

 

Is $122,858 USD a Month Enough to Live On?

Recently it was reported that Tracey Hejailan-Amon was granted $122,858 USD as temporary monthly support. This is in addition to a lump-sum payment of $1,262,121. However, Tracey Hejailan-Amon says it “isn’t enough”.

Her husband Maurice Alain is apparently worth $1.4 billion.

The support order was made by a Monaco Court, but the wife would like to have the case heard in New York. Her lawyer stated that the wife:

“maintains that she was never domiciled in Monaco … [Maurice] contends that Tracey’s shoe collection … was in the Monaco home and this constitutes proof that she was a Monaco domiciliary. This case is a ‘shoe-in’ for the record books in Monaco — it’s well beyond the ‘War of Roses,’ it’s the ‘War of Louboutins.’ ”

This case, and the high monetary awards, are similar to the Bitcoin cases we recently wrote about and also the case where the wife claimed support that included a wine budget of over $10,000 where the court considered:

 a large figured that had been included in the mother’s annual budget for wine.:

There is a claim of £10,555 per annum for “Wine”. The child is aged seven and does not consume the wine. This appears to be a mixture of wine supplied by the mother to the parents of children when they visit her home, and some general entertaining.

So what do you think?

Would a $122,858 USD a month be enough to meet your budget or would you request more?

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

Husband’s Decision to Return to School Full-Time was Unreasonable – Ordered to Cough Up Arrears

back-to-school-pig

Husband’s Decision to Return to School Full-Time was Unreasonable – Ordered to Cough Up Arrears

In a recent Ontario case, the court was asked to consider two interesting claims by a husband who was looking to avoid paying support arrears: 1) that he couldn’t earn more money because he was “blacklisted” in his industry; and 2) that his post-bankruptcy decision to go back to school full-time was reasonable.

The background facts were these: The husband had been paying about $800 per month in spousal support based on an annual income of about $56,000. For several years, his income had hovered around that point, but he lost his job in 2009, and claimed that he could not find work in the construction industry anywhere in the Greater Toronto Area because his “name in the industry was tarnished”. He claimed that in order to do manual work, he would have to join the union. He therefore did not pursue any manual labour jobs in construction.

Instead, he worked at various jobs until he declared bankruptcy in 2011, then went back to school full-time for the Law Clerk/Paralegal Program. Although he did not finish the program, he intended to do so on a part-time basis, aiming to complete it in 2015. His income therefore dropped for a few years to near $20,000, and he was currently working at a building supply store and expecting to earn $35,000 in 2013. (As an aside, the husband also admitted to spending $175,000 in less than 2 years, with $30,000 being spent towards a condominium, and $145,000 going toward three lawyers for his file.)

The wife, who earned about the same amount as a funeral home receptionist, asked the court to enforce the arrears in spousal support that had accumulated in the past few years, and also asked to have income imputed to the under-earning husband. She claimed that his decision to go back to school full-time to become a Law Clerk or Paralegal was unreasonable in the circumstances, given that it meant he would not be able to meet his obligations to support his family.

The court concluded that it was indeed unreasonable for the husband to go back to school full-time, and that in any event he had not made a diligent effort to complete the program and find employment in the field. He was also under-earning even in the work he did have at present. Still, the court declined to impute the full $65,000 income to him; rather it assumed he could have been earning just over $40,000 per year. As for the husband’s contention that his name had been tarnished, the court said:

The husband’s position that he was blacklisted from ever being hired in the construction industry is speculation and conjecture. It is difficult to accept that testimony without some corroboration. The construction industry in the GTA is a large industry and it is difficult to understand how he could be blacklisted throughout the entirety of that industry. I also cannot accept that [the husband] would have been unable to work in the construction industry in some other capacity other than as a Project Co-ordinator or Manager.

As a result, the court adjusted the support accordingly and ordered the husband to pay a portion of arrears, pointing out that an order for him to pay full arrears would “crush” him.

For the full text of the decision, see:

Bozzelli v. Bozzelli (2014), 2014 ONSC 254 http://canlii.ca/t/g2psf

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.

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We are seeking an Associate Lawyer to join our team. A minimum of 2 years post-call experience in family law is required. Compensation will include a salary plus incentive based compensation. Our offices are located close to the GTA in Whitby, Markham & the City of Kawartha Lakes.

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Should Support Be Extended When the Recipient Spouse Loses Their Job?

In a recent case called Lawder v. Windsor, the court grappled with the issue of whether a support-paying spouse should have to pay for a longer period if the other spouse unexpectedly loses his or her job.

The couple had divorced in 1998 after 16 years of marriage. In 2000, the husband had been ordered by the court to pay $800 in monthly spousal support to the wife. He continued to make those payments until 2012, when he applied to the court for an order terminating his support obligations.

The husband claimed that in the circumstances, 12 years of paying support had been enough: he was now 56 years old and retired (he took an early retirement option as part of his termination due from a long-held job due to downsizing), and was two part-time jobs earning about $10 an hour. He also received a pension.

On the other hand the wife, now aged 51, was also employed and had enjoyed a steady increase to her income in the past five years. Unbeknownst to the husband, her income during that period rose from $38,000 to over $62,000 in 2012.

The glitch, however, was that the wife had recently lost her job due to corporate restructuring. She had received a termination package, but on the grounds that she was now unemployed she wanted the husband to continue paying support. (The court pointed out that she had provided no proof that she was actively looking for work, however).

The court considered the circumstances, and declined to extend support; it terminated the husband’s support obligations effective one month hence.

The court reasoned that spousal support was designed in part to compensate the wife for any economic disadvantage that she had suffered as a result of the marriage or its breakdown. That goal had been achieved through the husband paying support since 2007; the job loss now had nothing to do with the marriage or its breakdown.

Further, it was clear that the wife had achieved economic self-sufficiency: she had gotten a good job with a high degree of responsibility, and her income had increased steadily in the past five years alone. She had also never asked for a review of the support order and had never taken advantage of its built-in indexing of support amount.

In short: The wife’s recent job loss was not a good reason for extending support now; there was nothing to suggest that her temporary unemployment would affect her self-sufficiency in the bigger picture, and any short-term financial setback was something she could address through her own efforts and diligence.

For the full text of the decision, see:

Lawder v. Windsor, 2013 ONSC 5948  http://canlii.ca/t/g0qb3

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.

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