This Month In Nova Scotia Family Law – April 2024

Hanak v Hanak, 2024 NSCA 44

Judge: Justice Elizabeth Van den Eynden
Subject: Appeal of an Interim Order, Imputation of Income, Fresh Evidence

Summary: Mr. Hanak sought leave to appeal from an interim order, which imputed his income at $200,000 for the purpose of determining his support obligations. He argued instead that his annual income should be set at $46,000 based on his "guesstimate". He sought to admit fresh evidence of his income. It was clear that the application for leave, and the appeal itself, hinged on his ability to admit fresh evidence about his income.

Mr. Hanak operates a motel business. At an interim hearing, Justice Forgeron imputed his income at $200,000 based on the parties' lifestyle, and Mr. Hanak's failure to produce his income tax return or statements of business expenses. Justice Forgeron rejected Mr. Hanak's argument that Ms. Hanak had prevented his financial disclosure.

In requesting leave to appeal from the interim decision, Mr. Hanak sought to introduce an affidavit repeating his allegations that Ms. Hanak prevented the disclosure of financial information at the interim hearing, and an affidavit of the accountant who assisted him in completing his 2022 tax return after the interim hearing.

The Judge found that the fresh evidence did not pass the due diligence assessment and the motion should be dismissed.

White v Bradley, 2024 NSCA 46

Judge: Justice Elizabeth Van den Eynden
Subject: Child support, Imputation of income

Summary: Mr. White sought to overturn the trial Judge's determination of child support regarding the child T. He also submitted that income was improperly imputed to Ms. Bradley and that the Judge was biased against him.

The trial judge found that T did not live with Ms. Bradley after January 2020, which is when Mr. White's child support was to end. T enrolled in an upgrading program until 2022 and then graduated and worked full time. Mr. White wanted Ms. Bradley to contribute to retroactive medical expenses for T, reimburse Mr. White for child support amounts he paid, contribute to T's prospective post-secondary education costs and pay him costs related to certain expenses and lost wages.

Upon reviewing the record, the Court of Appeal was satisfied that the trial Judge appropriately weighed the evidence regarding where T lived and applied the correct determination of a effective date. There was also no error regarding her assessment that T was employed on a full-time basis and there was insufficient evidence to award costs for future educational pursuits. The Court also found that Mr. White's submissions about an error in the assessment of Ms. Bradley's income were without evidence and unpersuasive. The same was said for his arguments about medical expenses and request to have Ms. Bradley repay Mr. White for child support she received from January 2020 – October 2022.

Mr. White's submissions regarding bias suggested that he viewed determinations which did not go his way as being the result of judicial bias. The judge found that there was no merit to this claim, especially as there were no errors of law or factual findings made by Justice Jollimore.

CB v. AB, 2024 NSSC 91

Judge: Justice Lee Anne MacLeod-Archer
Subject: Divorce, Division of Assets and Debts, Parenting Arrangements, Material Change, Child Support, Non-Taxable Income

Summary: The parties were married for nine years. There are two children of the marriage, they are nine and six years old.

When the parties initially separated, they remained living under the same roof and shared parenting of the children. Once the parties completely separated, the children remained in the matrimonial home with their mother.

The mother sought an order for a deferred division of the value of the matrimonial home until she was in a position to buy-out the father. The father opposed the division deferral and stated that the mother is not able to buy him out and suggests that her buy-out being deferred constituted an unequal division. The Court found that it was in the best interest of the children to allow the mother thirty days from the date of the decision to purchase the father's interest. If the mother does not complete the sale within thirty days, the father can purchase her interest instead.

The mother requested a variation to the parenting arrangement to allow her an overnight with the children on Saturday every second week. The father objected to this and wished to maintain the current schedule and not disrupt the children's routine. The Court declined variation and found that the mother did not meet the onus of proving a material change since the consent order was negotiated and issued in 2021. The mother's change in work status was not considered material, in that she was planning to return to school on full-time basis within months of the settlement in 2021, and now works full-time. The Court stated that both scenarios require her to be out of the home Monday to Friday and that the anticipated change in status was known to the parties in 2021.

The father is a member of a First Nations Band and works on reserve, meaning he does not pay income tax and his reported income must be grossed up. The mother argued that the father receives money from the Band throughout the year which he denies. The father reported receiving $200 per child at Christmas and the mother did not provide any proof of additional payments. The Court declined to impute these payments as income.

The father claimed compensation for overpayment of child support since 2022. The mother's reported income for 2022 was $38,916 and $45,891 for 2023. The father's reported income for 2022 was $44,941 and $49,886 for 2023. Both parties argued that an order for straight set-off of child support under section 9 of the Child Support Guidelines was appropriate. The Court found that the father overpaid child support in 2022 by $954 and $1,302 in 2023, totaling $2,257 in overpayment and that the overpayment be deducted from future payments

The Court found that the father owes the mother for childcare dating back to 2021 as set out in section 7(3) of the Child Support Guidelines. The Court calculated the amount owing based on the net childcare expense after considering the subsidy the mother received for childcare, finding that the entire subsidy by the province ($3,101) should be deducted.

The Court concluded that the net sum owing from the mother to the father is $1,047.50. If the mother does not buy-out the father's interest, the amount she owes him must be deducted from his payment on closing if he buys her interest.

Matheson v Matheson, 2024 NSSC 19

Judge: Justice Daniel Ingersoll
Subject: Variation Application, Post-Secondary Education, Spousal Support

Summary: Karen and Brian Matheson separated in 2012 after a 24 year marriage and they divorced in 2021. Ms. Matheson received spousal support from 2014 until Mr. Matheson retired in 2021.

Ms. Matheson argued that she was underpaid in spousal support between 2014 and 2021 and Mr. Matheson should continue to pay spousal support indefinitely, that she and Mr. Matheson should each contribute $15, 000 toward their daughter's university debt, and that she should not be liable for half the CRA debt accrued during the marriage.

Mr. Matheson argued that the minutes of settlement did not require him to pay spousal support after he retired. The minutes of settlement however do not say this, they relieve him of his obligation to pay $4,500 of spousal support monthly upon his retirement and are silent on whether Ms. Matheson will be entitled to any spousal support after his retirement. The minutes of settlement provided that either party can automatically apply for a review of spousal support once Mr. Matheson's pension has been divided, which has occurred. The Court found that Ms. Matheson's need for spousal support ended when she began receiving her share of Mr. Matheson's pension, as she is able to maintain her pre-separation lifestyle without spousal support.

Regarding historical spousal support, the Minutes of Settlement do no confer a retrospective right of review. However, Ms. Matheson claimed that she was entitled to a historic assessment of spousal support because Mr. Matheson's failure to retire and subsequent income increase created a material change in circumstances. The Judge accepted that a material change in circumstances had occurred. The Judge also found that Mr. Matheson had failed to meet his disclosure obligations which delayed Ms. Matheson from taking appropriate steps to seek retroactive spousal support. Based on the updated disclosure Justice Ingersoll found that Mr. Matheson had underpaid Ms. Matheson, and ordered him to pay $34,476 within 30 days of the decision.

Ms. Matheson argued that since the parties paid for their son's undergraduate and law degree, they should pay for their daughter's undergraduate and MBA. The daughter had funded her own MBA, and accrued $30,000 in debt. The Judge found that the Minutes of Settlement did not terminate the parties' obligation to continue to contribute to the daughter's education.

The Court found that the daughter was a child of the marriage while pursuing her MBA, and ordered the parties to pay her tuition expenses of $27,000 in proportion to their respective incomes.

The judge was unable to find that Ms. Matheson was not responsible for half the CRA debt. This debt was completed under the Minutes of Settlement with both parties agreeing to full disclosure. As a result, there is not a claim that Mr. Matheson withheld information.

Griffin v Griffin, 2024 NSSC 123

Judge: Justice Lee Anne MacLeod-Archer
Subject: Divorce, Division of Assets, Child support, Spousal support

Summary: The parties were married for 13 years and have two children, aged 15 and 20. The parties have been living separate and apart for almost 4 years.

The parties both moved out of the matrimonial home. The Court ordered it sold.

Mr. Griffin argued that because he owned the vacant lot (where the parties built their home) before their marriage, it ought to be exempt from division. However, he led no evidence in support of a claim under s. 13 of the Matrimonial Property Act. The court ordered the proceeds of sale equally divided.

The parties agreed that both children are dependent. The parties had agreed in the Interim Order that Mr. Griffin was to pay child support directly to their older daughter and the balance to Ms. Griffin for their son's support. The parties did not seek for this order to be changed and so the Judge directed that Mr. Griffin was to pay $750 a month to the daughter and $1,553.55 to Ms. Griffin. The Judge declined to set termination dates for the child support on the basis that there are too many unknowns regarding the children's future.

Mr. Griffin sought a credit for amounts overpaid in child support, as a result of his payment towards mortgage, property tax, credit card payments and vehicle loans. The Judge found that the third party payments would not be considered child support. Retroactive support was ordered for a period of time when Mr. Griffin failed to pay support.

During the marriage Mr. Griffin was the sole earner, although Ms. Griffin pursued education to become a paralegal and is now pursuing education to become a social worker. Ms. Griffin was found to be entitled to spousal support on a compensatory basis and a non-compensatory basis because even if she had secured work as a paralegal she would still be earning less than Mr. Griffin would as a skilled tradesperson. The Judge imputed a part time income to Ms. Griffin on the basis that while she is in school she could be working part time as many students do. Given the means and needs of the parties, Justice MacLeod-Archer awarded spousal support at the low end of the sale, assessing Ms. Griffin as being owed $2,500 per month.

JC v BW, 2024 NSSC 95

Judge: Justice Samuel Moreau
Subject: Late Evidence, Variation Application, Change in Circumstances, Child Support

Summary: The parties are parents of three children, P, R and G. The Applicant sought a change in child support on the basis of a change in employment. However, the Applicant's evidence was struck on the basis that it was submitted late and would cause prejudice to the respondent if accepted. The hearing proceeded on the Respondent's evidence.

Since the previous Order for support, the Applicant has left the military and now works with Carle Solutions Inc, which is a business he started, and his fiancé is the director of. The Judge accepted that this constituted a material change in circumstances. However, the Judge was without evidence about his income since filing the Notice of Variation Application or financial information per the Order for Disclosure. The Judge did not have any evidence from which to impute income derived from Carle Solutions Inc. The Judge accepted that there was a material change in circumstances but stated that the Applicant should not benefit from his non-compliance.

The Judge found that income should be imputed to the Applicant because he failed to comply with court deadlines as directed. As such the Judge imputed the Applicant's figure by increasing the Applicant's 2016 income by 8%. He ordered that the applicant should pay the Ontario (where the applicant is now based) child support table amount of $1,417.28 a month.

Anthony v Anthony, 2024 NSSC 100

Judge: Justice Theresa M Forgeron
Subject: Motion for Disclosure, Controlling Interest in Corporation

Summary: The parties were married for 31 one years and had two children together. The parties separated in August 2021 and the children were no longer dependent. When the parties married they had a marriage contract which stipulated how the businesses and properties were to be divided.

Ms. Anthony requested extensive disclosure from Mr. Anthony, both personally and from business which she claims are owned or partially owned by him. Mr. Anthony claims that some of the business do not exist and that he cannot disclosure information from companies that he does not control. He also categorized her requests as fishing expeditions and states that the volume of information requested offends the principle of proportionality.

Ms. Anthony argued that the disclosure would help determine if the marriage contract was overly harsh, the value of the unpaid work she provided to the businesses, the financial consequences arising from her disproportionate payment to the family expenses and the amount of money which was transferred out of joint accounts into business accounts.

The judge found that Mr. Anthony could be ordered to disclose information and documents from companies where he is a non-controlling shareholder on the basis that there is no separate rule for non-controlling parties. The obligation to produce rests on Mr. Anthony and not the companies and it is Mr. Anthony who is involved in the divorce litigation in which spousal support is claimed. Furthermore, case law supports Ms. Anthony's position. The Judge granted the disclosure requests for Mr. Anthony's tax returns and personal banking records but not his credit report because that is not relevant to the litigation.

For businesses where there is evidence that Mr. Anthony owns shares and that the business still exists corporate records were ordered to be disclosed.

Ward v Murphy, 2024 NSSC 117

Judge: Honourable Justice Theresa M Forgeron
Subject: Costs

Summary: Both parties seek costs stemming from two lengthy variation hearings. Mr. Ward argued that he should be awarded costs of $32,938 plus $1,955 for his accountant's fees because he was the successful party. Ms. Murphy sought costs of $32,938 based on her success, her favourable settlement offer, and Mr. Ward's poor litigation conduct.

The parties have a 9 year history of litigation about their 9 year old son. In 2017, Justice Gregan heard an 11 day trial and issued an order. In 2018, Mr. Ward filed a variation application, which was determined in 2021, and costs were later awarded. Mr. Ward appealed both decisions. The Court of Appeal directed a re-hearing of a substantive issue and costs. Justice Forgeron determined the issues for re-hearing.

The parties disagreed as to who was the successful party. Ms. Murphy was successful on the issue of imputation of personal income, the issue of the holdback fee and the leave requirement. The parties had mixed success on the imputation of available corporate income for child support purposes. Overall, Ms. Murphy was the successful party and so costs are payable to her.

The court did not accept Ms. Murphy's request to apply the 'rule of thumb' because no evidence of legal accounts were provided. The Court applied the tariffs of the Civil Procedure Rules, and determined that costs of $6,000 were payable under the tariffs.

The judge increased the costs award by additional $2,000 in costs on the basis of a settlement offer by Ms. Murphy.

Justice Forgeron determined that Mr. Ward's litigation conduct unduly and inappropriately increased the time it took for a hearing. This included attempting to lead evidence on issues not before the court, treating counsel with disrespect, blaming court staff for perceived bias, failing to accept evidentiary rulings, and failing to be organized for the process of marking exhibits. The costs award was increased by a further $8,000.

Ultimately, Mr. Ward was ordered to pay costs of $16,000 to Ms. Murphy, less $750 of accountant's fees for the accountant's discovery expense. This award is to be paid in $500 monthly installments.

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