IN THE SUPREME COURT OF NOVA SCOTIA
(FAMILY DIVISION)
Citation: MacDonald v. MacDonald, 2004 NSSF 99
Date: October 22, 2004
Docket: SFPAD-030034
Registry: Port Hawkesbury
Between:
Richard Garry MacDonald
Applicant
v.
Kerry Lynn MacDonald
Respondent
Justice: The Honourable Justice Moira Legere-Sers
Heard: October 7, 2004, in Port Hawkesbury, Nova Scotia
Written Decision: October 22, 2004
Counsel: Louise Campbell for Applicant
Harvey McPhee for Respondent
By the Court:
[1] By application dated October, 2003, the Applicant, Richard MacDonald, applied for a variation of the Corollary Relief Judgement dated the 21st day of June, 2001.
[2] The bases of his application is that he has a responsibility in accordance with the Corollary Relief Judgement to pay for three dependent children. He indicates that his oldest child Naomi is 18 years of age and is living with her boyfriend and is no longer dependent within the meaning of the Divorce Act. He has a child who was deceased in July, 2003. He wishes the Corollary Relief Judgement to reflect those changes.
[3] The Respondent, Kerry MacDonald, filed a reply dated the 30th day of September, 2004 requesting (1) that the Corollary Relief Judgement be changed to reflect payment in accordance with the Federal Child Support Guidelines based on her belief that the Respondent’s annual income is $70,620.00.
[4] Ms. MacDonald also requests; (2) that the monthly child support be a consistent amount and not be designed as a two tiered award; (3) she requests an order for contribution to the orthodontic expenses of the dependent child Myron Garry, pursuant to section 7 of the Federal Child Support Guidelines; (4) an Order enforcing paragraph 4(g)(ii) of the Corollary Relief Judgement relating to the division of property which requires the Applicant to pay the second and final installment owing to the Respondent (ie.$2,000.00); (5) the Respondent seeks the Applicant to reimburse her for any medical expenses she has paid, subsequent to the removal of her name from the Applicant’s medical health benefits plan in contravention of paragraph 2(i) of the Corollary Relief Judgement and (6) she seeks an Order requiring the Applicant to pay for the Respondent’s future medical-dental expenses which would otherwise be covered by the plan or to purchase a new medical-dental plan for the Respondent with the same coverage as provided by the Applicant’s plan.
[5] The Corollary Relief Judgement dated 21st day of June, 2001 was entered into as a result of negotiations between the parties. It is their agreed upon Minutes of Settlement.
[6] According to this, the Respondent is deemed to have an annual income of $62,000.00 and required to pay support for the three dependant children of the marriage, Naomi, born […], 1985; Brandon Alexander, born […], 1987 and Myron Garry, born […], 1991. The child support payable was $1,080.00 per month, payable on the 1st day of each and every month.
[7] The Applicant has a history of earning income yearly from two sources. His first source of income is from his trade; his second source of income is from EI benefits. The agreement required that he pay child support based on the extrapolation of the gross amount earned while he is on EI over a twelve month period. At the time of the agreement he was in receipt of EI in the amount of $398.00 per week or gross of $1,592.00 per month. This resulted in a child support payment of $369.00 per month.
[8] There was an extraordinary orthodontic expense bringing the total monthly payment to $439.00 while on EI representing a $70.00 a month payment towards the orthodontic expense and $100.00 when he was working.
[9] This orthodontic expense is paid in full.
[10] There is a dispute as to when Naomi became a child able to withdraw from the support of her parents. Naomi graduated from high school in June, 2003. At the same time on or about April, 2003, she had a baby, was living with her mother and returned to graduate in June, 2003. She did not return to school. She and her boyfriend intermittently have lived with the Respondent off and on up to approximately a few days prior to this variation hearing. At that time, she removed herself from her mother’s residence to live on her own with her boyfriend. While her boyfriend lived with her in the mother’s home, he contributed towards board. I am not aware as to what if any contributions the child’s father has made towards the infant child of Naomi.
[11] The Applicant believes Naomi should be determined to be an independent child as of June, 2003 and the Respondent believes she should have been supported by them, legally pursuant to the Child Support Guidelines, until November, 2003.
[12] The second child Brandon, is deceased. Obviously his tragic death has been difficult for both parents to bear. There would no longer be child support payment for Brandon after July, 2003.
[13] Myron, they agree continues to be a dependent child and Myron needs orthodontic work. The Applicant agrees that he should continue to pay in accordance with the guidelines for Myron and he will pay his pro rated share of the orthodontic expenses providing he receives receipts for the work done.
[14] The Applicant believes, based on his current income, that there is an over payment due to him and he asked the Court to consider the overpayment. The Respondent believes that there has been an underpayment and seeks to have that, as well as the $2,000.00 under the Corollary Relief Judgement, paid to her. The Respondent seeks consistency primarily because the Applicant has not abided by Court Order to provide his change in employment status on a timely basis. This has resulted in leaving the Respondent with the responsibility to pursue the Applicant for payment and for financial information from the Applicant. The Applicant found himself in a serious situation of arrears.
[15] The Applicant indicates he will no longer be reticent to provide documentation on a regular basis. It is notable that full disclosure was only received one month prior to this hearing date.
[16] For example, the Applicant was to provide information to the Respondent when he obtained employment in Alberta and provide his pay stubs. He was also to inform the Respondent of the amount he is to receive, pursuant to any claim he may file, at any time for employment insurance benefits within 20 days of filing the claim for benefits and he failed to do so.
[17] Further, he was required to promptly notify the Respondent and the Maintenance Enforcement Program of any changes in his employment status, income and place of residence and supply, if directed or requested, any vouchers as to his income.
[18] Further, the Applicant and the Respondent were to file and exchange copies of their Income Tax Returns for the preceding year by June 30th of each and every year.
[19] The Applicant has failed to comply with these directions.
[20] Disclosure only came one month prior to today’s date as a result of Court direction. Mr. MacDonald has disclosed his income to be as follows:
1998 - $70,594.00 (self employed) Canada Post (employment $47,740.00; EI $9,813.00; other $222.76)
1999 - $55,327.00
2000 - $63,037.00 (employment $47,704.00; EI $9,013.00)
2001 - $57,740.00
2002 - $56,826.00 (employment $43,776.00; EI $12,803.00; other $247.00)
2003 - $70,620.00 (employment $63,867.00; EI $6,505.00; other $247.00)
[21] There is a history of lay-offs and Employment Income associated with his line of work as a construction pipe fitter. Historically, he travels to any part of Canada in order to obtain work . In the year 2004, since Mr. MacDonald’s application, he has experienced the most prolonged period of unemployment. Commencing February, 2004 he received $413.00 per week on EI for a total to September 4, 2004 of $11,151.00. He anticipates leaving for Calgary shortly to determine whether he can be hired on through a Union hall.
[22] He has maintained his health benefits for the children and for the Respondent up to November 19, 2003. The Applicant responded to an inquiry from his company for an update on his dependent’s for his medical plan. He advised them that he was living common-law. They removed the Respondent from the plan. He advised the Dentist and the Respondent began to be charged for medical expenses.
[23] The Applicant proposes the date in which his oldest child is considered independent is June, 2003. July, 2003 for his second child and acknowledges the continuation of a child support Order for the third child. Based on those dates, he believes that he has over paid child support by $7,063.00 and over paid dental by $1,150.00 for a total over payment of $8,213.00.
[24] The current circumstances of Ms. MacDonald are difficult. She has maintained a place for Naomi while she had her baby and subsequently as she moved in and out of her household. She acknowledges that as of October, 2004 Naomi is no longer a dependent. She advises that she takes medication for depression and that her business, which is a hairdresser, has been significantly affected by the depression she experienced immediately after her son’s death. She is now working again and shows a taxable income from 2003 of $7,579.80. For the past four to five years previous to that she has earned $11,00.00 to $12,000.00.
[25] She advises that when Naomi’s boyfriend stayed with her, he paid $50.00 a week rent. She seeks reimbursement for her medical expenses. More importantly she seeks a consistent Order that does not require her to seek disclosure from the Applicant. She indicates that she is unable to pay retroactive maintenance. She believes Naomi should be taken off the Order as of November 1, 2003.
[26] Circumstances have changed radically since the Corollary Relief Judgement in this situation. The oldest child Naomi turned 19 on February 18, 2004. Fortunately, she graduated from high school despite having to take a short leave to have her own baby. She has not embarked on any further educational programs which would have continued her dependancy within the definition of the Divorce Act. She has lived mostly with her mother during her child’s early infant stage and thereafter moved in and out of her mother’s home with her boyfriend. While he lived there he paid board of $50.00 a week . Naomi was not in a position to contribute. Obviously the Respondent supported these young adults out of her own sense of moral obligation.
[27] The oldest daughter has no plans to recommence her education. Her gross income from March, 2004 to September, 2004 is $7,527.00. Payments for her will cease effective September 1, 2003.
[28] Payment for their second child will cease effective July 31, 2003. I have no information as to any special expenses associated with his death. If they existed they were not mentioned. Should that be an issues the parties may apply to resolve that at a later date.
[29] This leaves the youngest child who remains a dependant. The extraordinary expense is orthodontic work. This expense will be shared pro rata by the Applicant and Respondent for the year 2003 in accordance with their annual incomes. And in the same manner in 2004-2005 in accordance with their annualized incomes. For the purposes of this expense, the Applicant’s 2003 income will be as declared and 2004 income will $62,000.00. The Respondent’s 2003 income is as declared and 2004 income will be provided by December 20th 2004.
[30] Any reimbursement required shall be paid by the Applicant within 30days of the receipt for services or bills being tendered. Any costs associated with obtaining reimbursement, including legal fees should that be required to obtain reimbursement, will be considered a recoverable cost subject to taxing.
[31] The support payable for the 2003 year is as follows:
January to July 31 - $1,203.00 by 6 months = $7,218.00
August - $922.00 by 1 month = $922.00
September to December - $570.00 by 4 months = $2,280.00 January to October/04 - $172.00 by 10 months = $1,720.00
TOTAL: $ 12,140.00
[32] I do not have access to an updated record of payments from the Maintenance Enforcement Program. The Applicant completed some calculations base on times and annual salary. I have not accepted this as accurate. The 2003 year annual income ought to be the total income.
[33] The current Employment Insurance income is higher than the amount in the Corollary Relief Judgement. I have used the most current weekly income of $413.00 for a monthly payment of $172. 00.
[34] The Applicant asks that I set the future amount to reflect a two tiered income level. He admits he has not complied with the disclosure requirements set out in the Corollary Relief Judgement and has not provided timely notice regarding employment. This leaves the Respondent in the constant position of having to seek out the exact figures herself or through the Maintenance Enforcement Program . In addition he has failed to disclose income until one month ago.
[35] I note that since this application, in October, the Applicant has been on EI benefits. He testified he would be going to Calgary for work shortly after the hearing. He wants to pay based on his current EI and agreed that when he returns to work he will pay based on an annual income of $62,000.00.
[36] I have averaged out his income over the last 6 years and the last three years. $62,000.00 is a fair estimate of his average annual earnings. He does not want the support based on his last years income of $70,620.00 as he believes this is unusually high.
[37] He did not file extensive financial information. He lives in a home with his partner and rents out the basement apartment to a friend without maximizing the benefits, as one would think he might, if he were in serious need of income.
[38] It is his habit to earn significant income from his trade when he works and when work is available. Each year he has supplemented his income with EI. In fact while this year his EI is $11,151.00, in 2002 he has EI income of $12,803.00 and still earned $43,726.00 for a total of $56,826.00. There is time in this year for him to bring himself to his average, depending on where he gets work. It is also his custom to move to places inside Canada to find work. This is the nature of his trade.
[39] Mr. MacDonald admits he owes the Respondent $2000.00 from the property division and has not paid that yet. His reasoning for his failure to pay the remaining $2000.00, in accordance with their contract signed in June 21, 2001, is not sound. His interpretation of the contract is not the interpretation I would draw. In the event the Respondent has to take legal proceedings to recover this amount, the Respondent may face costs of recovery. In the event he has another, more sound reason, he should advance it.
[40] He also admits that he no longer reimburses Ms. MacDonald for her medical as required in the agreement. These decisions, on his part, create uncertainly in the financial reality of the custodial household.
[41] The Applicant now seeks relief from the requirement he provide medical coverage. The Respondent seeks to enforce the payment of $2000.00. In reviewing the agreement it is clear there were transfers of property to satisfy spousal support claims. The $2000.00 is part and parcel of that agreement.
[42] Both parties were represented by counsel. The requirement set out in 2(i) to continue to provide medical coverage for both the Respondent and the children while employed and coverage is available during employment is not ambiguous. There is no termination date. It is not for Courts to lightly interfere with agreements entered into in good faith between adult persons, particularly where both parties are represented by counsel, and the agreement is not unduly harsh. The agreement was an overall settlement package addressing all issues outstanding.
[43] Mr. MacDonald will live by the agreement and provide coverage while he is employed. He will reimburse the Applicant for any procedures undertaken when employed. Should he be underemployed he will not obtain relief from this provision. That is why notice to the Respondent is so critical. She can plan in advance those procedures that can and will be covered.
[44] While I have information that one spouse has been substituted for another on the Applicant’s plan, it may be he can reinstate one for the other or provide accordingly. If not he will pay for a plan of equivalent value or reimburse directly the expenses within 30 days of receiving a receipt.
[45] This coverage however ought not to be considered a benefit for life. The Corollary Relief Judgement was signed in 2001. It is premature to consider a variation of this portion of the agreement this early in the life of the agreement.
[46] I have no evidence that would suggest that provision of this in accordance to the agreed terms of the contract is now an onerous provision.
[47] Ms. MacDonald experienced a reduction in income subsequent to the death of her son. Traditionally she earns $11,000.00 - $12,000.00 annually. In 2003 she earned $7,579.80. She also absorbed the responsibility for her daughter.
[48] Based on the above I have accepted that from January to October due to this prolonged period of unemployment, the child support owning will be in accordance with the EI.
[49] However, Mr. MacDonald is able to make long range plans. He pays now only for one child. He is able to make plans for what he knows is an inevitable situation, that is that he will be working during part of the year and receiving EI benefits during the rest. I have not been convinced that he has exhausted all income earning possibilities.
[50] Once he recommences employment, based on the average income, he will pay not at the highest rate, rather at his average yearly wage in the amount of $62,000.00 on a monthly basis throughout the year.
[51] He will immediately file with the Respondent the particulars of his employment and file with her each year by May 15th a complete copy of his Income Tax Return. He will then advise the Maintenance Enforcement Program immediately and reinstate his payment based on an average of $62,000.00 in the months that he is employed .
[52] In the 2005 year should his income increase he shall immediately make arrangements to adjust the child support amount.
[53] While the dependant child remains a child, any default on the part of the Applicant directly affects the finances in the Respondent’s household. In the event there is further default, the Court could consider an award in excess of the guideline amount to ensure the financial instability in the Respondent’s house does not affect the financial stability for the child.
[54] The Applicant is to keep the child covered on his health insurance plan while employed and unemployed. In the event he is unable to do so, the health care costs relating to the child shall be considered section 7 expenses.
[55] Counsel for the Applicant shall draft the order. The parties may set the matter down for a docket appearance in the event they cannot agree on the terms.
[56] Each party shall bear their own costs.
Justice M. Legere-Sers
A Justice of the Supreme Court Family Division