Cole (Hearn) v. Cole, 2011 ABQB 607

Court of Queen ’ s Bench of Alberta Citation: Cole (Hearn) v. Cole, 2011 ABQB 607 Date: 20111003 Docket: 4801 114581 Registry: Calgary Between: Wendy Suzanne Cole Also Known As Wendy Suzanne Hearn Plaintiff - and - Anthony John Hedley Cole Defendant _______________________________________________________ Memorandum of Judgment of the Honourable Mr. Justice P.J. McIntyre _______________________________________________________ [ 1 ] This is a high conflict matrimonial matter. I am the case management judge. At issue are child support payments and

section 7 expenses. Ms. Hearn asks for payment of $55,713 “arrears” of

section 7 expenses from September 2001 and $266,060.00 plus interest for “outstanding child support payments” from July 2005 to April 30, 2011. I use quotation marks because Mr. Cole is up-to-date with child support payments based on the Order of Justice A. B. Sulatycky dated July 5, 2005, which does not require Mr. Cole to pay

section 7 expenses. His obligations in addition to child support are more extensive than

section 7 expenses, as I will discuss below. A printout from the Maintenance Enforcement Program shows nothing owing. Mr. Cole says that nothing is owing on

section 7s, or otherwise, that no child support should have been paid when the daughter was at University, that he should be reimbursed for those payments, and that no child support should be paid when the children (now 19 and 18) are at school. [ 2 ] Sulatycky J. heard the trial in this matter in 2005. The trial lasted seven days. Custody and access, child support payments, ongoing

section 7 expenses, spousal support, and matrimonial property were at issue. Neither party was represented by counsel. A bilateral assessment had been prepared by Dr. Stephen Edwards, a court-appointed psychologist. Witnesses included Dr. Edwards and

Michael Ward, a minister with Central United Church, and the parties. The children, then aged 13 and 11, were interviewed by Sulatycky J in his private chambers. He was impressed by the children, and asked that they be in court for his trial decision. Nothing negative would be said of the parents. [ 3 ] Dr. Edwards’s bilateral assessment was 54 pages long. At page 53, he said he was concerned about Ms. Hearn’s psychological status. Earlier in the report he spoke of the financial conflict between the parties.

At page 6, under the heading “some broad conclusions” he stated: “the mother consistently complained of her and the children being in dire financial straits, the father being responsible for it and the children suffering considerably. It is no exaggeration to say that [the mother] is obsessed with this theme, that she perceives herself as having no responsibility and that she is very angry about it.” At page 9, he noted a therapist’s report that the mother could be extremely demanding, accusatory, and relentless.

She pursued issues “endlessly” and would not give up. “Wendy Cole could be very self-possessed and self-righteous, as well as obsessive.” At page 25, he stated: “the mother is rigid, self-righteous, angry and immersed in the victim role to the point she has no insight as to the impact of her behaviour and feelings on the father and the children. This is so despite Wendy Cole giving lip service to the interparental conflict harming [the children]”. In my view these themes continue. [ 4 ] Sulatycky J. gave an oral decision July 5, 2005.

He asked that there be counsel for the children, and that counsel attend his decision, and so Ms. Dale Hensley, counsel with Children’s Legal and Education Resource Centre, attended his decision. Sulatycky J. began by calling the situation between the parties an “extraordinary one”. He noted that Dr. Edwards said that extraordinary parenting arrangements are required and stated: “That is what is called for in this case”. He did not follow Dr. Edwards’ recommendation of sole custody to Mr. Cole. (Mr. Cole had suggested joint custody.) He granted joint custody with shared parenting, however he held that Mr.

Cole was better placed to make decisions for the children, and that he would be given sole and exclusive decision-making authority for the children’s education, health, and general welfare. Mr. Cole was required to pay for all the children’s extra needs because he was responsible for all of the children’s extracurricular activities. Ms. Hearn was not to have financial responsibility for orthodontic care, healthcare, extracurricular activities, school expenses and so forth.

Section 7 payments were not to be paid by either side because Mr. Cole was responsible for all the activities and all costs. Sulatycky J., was aware the family income was almost $500,000 a year when Mr. Cole cashed in some of his stock options. Without the stock options the joint earnings were roughly $250,000 a year, yet he ordered an amount of $800 a month for both children. At transcript page 17 he stated that because of the disparity in their income earning ability and because this was an extraordinary arrangement being ordered, his Order would not be in accordance with the child support guidelines. Thus he ordered Mr. Cole to pay $800 per month for both children with no

section 7s to be paid by either party. Mr. Cole was to be responsible for all the children’s extracurricular activities and payment of them. The parties were required to put $15,000 in trust for the children’s ongoing activities, $10,000 from Mr. Cole and $5000 from Ms. Hearn. The trial decision was not appealed. [ 5 ]

Section 7 expenses were obviously a very difficult issue at the trial. They continue to be a difficult issue despite Sulatycky J.’s best efforts. At page 17 of his decision he noted that because Mr. Cole was responsible for all the children’s extracurricular activities,

section 7 expenses would not become an issue. There were issues relating to outstanding

section 7 expenses up to the date of the trial, but those matters were to be decided by Justice C. Kenny. There had been an earlier Consent Order dated July 22, 2003, by Justice P. Chrumka that split

section 7 expenses 60/40. By Order dated September 20, 2005 Kenny J. identified

section 7 expenses payable up to July 30, 2005 and required Mr. Cole to pay 60% of the monies owing until December 2004 and a further 60% of the amounts incurred up to July 30, 2005. This order was slightly amended on October 7, 2005 to reflect a payment by Mr. Cole of $515.87. [ 6 ] Disclosure of the parties’ respective incomes has been a problem in this case. Ms. Hearn did not provide the documents requested in the Notice to Disclose. By Order dated March 7, 2005 Justice B. Rawlins ordered disclosure. At transcript page 14 of the July 5, 2005 decision Sulatycky J. noted that Ms.

Hearn had not given complete disclosure whereas Mr. Cole had provided “elaborate and extensive disclosure”. Mr. Cole and Ms. Hearn made no disclosure to each other after the trial. [ 7 ] The trial decision did not end the conflict between the parties. Sulatycky J. continued to case manage the file. By Order dated April 25, 2006 he provided that only Ms. Hensley could make applications on behalf of the children. At a hearing on March 7, 2007 he removed Ms. Hearn from the courtroom because of her behaviour in court. He resigned as case manager because of Ms. Hearn’s allegations of bias.

He stated at transcript page 15: “Ms. Hensley is best suited to look after the needs of the children. The two of you are terrible terrible parents, the worst I’ve seen. The most intelligent couple, and the worst parents have seen in 25 years on the bench.” [ 8 ] I was appointed case manager in 2007. At a case management meeting on May 7, 2009 I directed that two issues be dealt with: whether Ms. Hearn could bring applications on children’s issues and whether case management was appropriate. On November 6 Kenny J. directed that an application ostensibly made by the male child for his own child support and

section 7 expenses be directed to me as case management judge. By order dated 16 December 2009 I made an Order to allow applications for child support and

section 7 expenses by the parents, if there were changed circumstances. However, any affidavit was restricted to the following: a. change in circumstances, in particular, how much time each child has spent with each parent.

b. Expenses not paid by Mr. Cole. c. Expenses paid by Mr. Cole. As a condition precedent to Ms. Hearn filing this Notice of Motion and Affidavit, I required full disclosure of her income in the last 5 years, supported by full copies of her income tax returns, together with Notices of Assessment and Reassessment. On receipt from Ms. Hearn, Mr. Cole would provide the same within one month. The mechanism in my 16 December Order required sending to me an unfiled motion and affidavit. The other side would then have a chance to comment before I would grant leave to allow such a motion.

Child management issues could only be brought by Dale Hensley, counsel for the children. Case management would continue. [ 9 ] The first Notice of Motion by Ms. Hearn and supporting affidavit ranged from change of circumstance (paragraph 1), to comments in paragraph 10 about statements made to “the judge at our divorce”, to a diatribe against the system of justice in paragraphs 12 - 16. [ 10 ] Ms. Hearn ultimately provided disclosure to me February 7, 2011. Despite my requirement that she provide disclosure to Mr Cole she refused to do so at his request until I had repeated my requirement to her. Mr.

Cole learned of Ms. Hearn’s income from 2005 on. Her five year average income presented at trial was $32,811, the highest being 48,060 in 2004. As will be seen, her income changed dramatically after that. [ 11 ] I summarize the line 150 income of the parties from their tax returns as follows: 2005 2006 2007 2008 2009 2010 Ms. Hearn 178,111 317,404 156,932 200,565 330,872 49,997 Mr. Cole 560,242 415,008 173,157 289,694 218,776 457,389 Ms. Hearn also provided one set of financial statements of her numbered company for the year ended July 31, 2010.

Revenue was said to be $36,701, with net earnings for the year and retained earnings at the end of the year $18,162. No income tax filing was provided. [ 12 ] Neither Mr. Cole nor Ms. Hearn was represented by counsel in various case management meetings. Ms. Hearn drafted her affidavit and notice of motion herself, but later retained well-known matrimonial counsel John Soby, QC, to argue this matter. Her affidavit, sworn on June 16, 2011, was broader in scope than the terms of my direction.

The headings included background, changes in payments for activities, changes in parenting responsibilities, changes in primary parenting time, changes in financial circumstances, and additional concerns. She appended an affidavit from her son that he had earlier filed asking that his father pay $50,000 for a BMW SUV. She also appended a statement from Sylvain Renaud who purported to review spreadsheets prepared by Ms. Hearn. There was a reference to a “monthly reward calculation”. I did not understand it. Counsel was not able to help me on the meaning. One spreadsheet prepared by Ms.

Hearn for “expenses not paid and paid for by Mr. Cole” started September 2001. The 2 nd spreadsheet, entitled “support not paid and paid by Mr. Cole” commenced September 2002. The latter was based on a weighted average of Ms. Hearn’s view of custody. [ 13 ] Mr. Cole’s affidavits describes payments he had made to support the children in their extracurricular activities over the years.

Among other payments, he described $2,500 for the son to attend the National Sport Development Program for hockey (April 30, 2009, paragraph 19), and a semester at University of Vitoria for the daughter, comprising, tuition, residency and books (April 7, 2011, paragraph 5).He disputed Ms. Hearn’s allegations as to what time was spent with what parent. In his argument he made reference to previously filed affidavits that disputed allegations made by Ms. Hearn.

[ 14 ] Sulatycky J. was made aware at the trial that Mr. Cole had a large income with stock options available to him from time to time. His 2004 income was $356, 041. Ms. Hearn’s average income had been $32,000 a year, but in 2005 she was earning roughly $100,000 a year (July 5, 2005 decision, page 8, line 5). At page 13 of his decision, Sulatycky J. referred to family income of $500,00 a year when stock options were cashed, and $250,000 when they were not. Her income has changed substantially, as has his. His income has stayed in the parameters understood by Sulatycky J. Conclusion Ms. Hearn [ 15 ] Mr.

Soby set out Ms. Hearn’s positions succinctly in his brief. I will deal with them in the order they are set out.

Section 7 Expenses [ 16 ] Ms. Hearn says she has not been compensated for

section 7 or other expenses she has incurred since September 2001. She says that she did not get a chance to address

section 7 expenses prior to 2005. She says Sulatycky J. instructed her in the July 2005 hearing to compile

section 7 expenses and they would be addressed. I have reviewed the Order from July 5, 2005 and the transcript. I find no such instruction. I find that Ms. Hearn has been compensated for

section 7 expenses she incurred up to and including July 30, 2005, as identified in the Order of Kenny J. dated September 20, 2005. This Order was not appealed. Much of Ms. Hearn’s arguments are attempts to re-argue that which has been decided. [ 17 ] After July 1, 2005, pursuant to the trial decision of Sulatycky J., Ms. Hearn had no responsibility for

section 7 expenses, extracurricular activities, or ongoing activities, nor did she have the right to incur any such expenses and demand payment of Mr. Cole. [ 18 ] In short, Ms. Hearn had neither the responsibility to pay

section 7 or other expenses nor the right to incur them with an expectation of repayment. Sulatycky J.’s decision was not appealed. Nothing in the affidavit evidence suggests that circumstances have changed such that Sulatycky J.’s Order on

section 7 and other expenses, should change. Base Support [ 19 ] Ms. Hearn claims a material change in circumstances for base support. [ 20 ] In my view, the only material change in circumstances are the profound changes to Ms. Hearn’s income, something she did not disclose until required to by this Court. [ 21 ] The transcripts of case management meetings are replete with Ms. Hearn’s claims of poverty, yet nowhere did she disclose her income.

This is all the more startling when we see that her 2005 income was more than her previous four years income; that her income in 2006 was $317,404 and that her income in 2009 was $330,872. Her average income from 2005 to 2009 was over $200,000. [ 22 ] Mr. Cole’s income was substantial in 2005, $560,242, but it included $307,185 from stock options that had already been treated as matrimonial property by Sulatycky J. in his 5 July 2005 Order (see Appendix “A”) and thus cannot be considered income. Further, Mr.

Cole’s income was understood by Sulatycky J to be substantial. [ 23 ] I do not find there to have been a material change in circumstance on Mr. Cole’s part from that understood by Sulatycky J.

Primary Care [ 24 ] Ms. Hearn says the relationship with the children is no longer shared custody, and that the children spend more than 60% of the time with her. Mr. Cole says that the relationship has been and remains one of shared custody, except for a recent dispute with his son, and that his son is attending school and will be in residence at SAIT, paid for by his father, this September. [ 25 ] There is competing affidavit evidence as to which child spends more time with the affiant parent. These conflicts do not support the notion that custody is no longer shared.

The son has not been with his father for the last months, following a dispute. He is now in residence at SAIT. In the context of the time spent by each child over the years with the parents, this recent change is not significant. Indeed, the original Order called for the son to spend more time with Mr. Cole than Ms. Hearn. I hold custody of the children between the parents remains shared, as contemplated in Sulatycky J.’s Order. Blameworthy Conduct [ 26 ] Each party alleges blameworthy conduct on the other for failing to disclose income. [ 27 ] On balance, Ms.

Hearn’s failure to disclose income is the most egregious. She did not provide complete disclosure prior to trial, refused to provide Mr. Cole with her income even after producing it to me, but most importantly, did not disclose income of $317, 000 in 2006 and $330,000 in 2009. So while in 2009, Mr. Cole was making less than Ms. Hearn, he was paying child support and all expenses. [ 28 ] I was startled by Ms. Hearn’s level of income, summarized in paragraph 11 above, after hearing much about poverty.

Even now, in her June 16, 2011 affidavit she says in para 27: “For the last two years the kids and I have lived well below the poverty line.” Yet her 2010 income was $49,997 and her numbered company owed $29, 776 to her. Further, on March 25, 2010 she paid, she says, $1,105.40 for ski gear for her son, and said she incurred $3,000 expenses driving him to school. One who lives below the poverty line doesn’t pay $1,000 for skis and spend $3,000 driving a teenager to school. [ 29 ] In any event, blameworthy conduct is an issue about when retroactive payments might commence.

As will be seen, I do not consider any retroactive payments appropriate. Children [ 30 ] Ms. Hearn says the children have suffered from Mr. Cole’s actions regarding child support. These children have not suffered from Mr. Cole’s level of child support as Ms. Hern claims, unless failure to provide the son with a BMW SUV can be so considered. It is not by me. [ 31 ] All the children’s financial needs are being well provided by Mr. Cole. Mr. Cole [ 32 ] Mr. Cole, who says he was surprised by Ms.

Hearn’s level of income after years of not knowing it, says that no further child support should be paid, and that none should have been paid when the daughter was at university. [ 33 ] I refer to Sulatycky J.’s decision. This case was, he held, a unique circumstance. Justice Bastarache, in DBS v. SRS [2006] 2. S.C.R. 23, noted at paragraph. 99: “At all times, a court should strive for a holistic view of the matter and decide each case on the basis of its particular factual matrix.” That is what Sulatycky J. tried to do. The fact that the litigation has not ceased is not the fault of his Order but rather Ms.

Hearn’s unwillingness to accept Sulatycky and Kenny JJ.’s rulings.

[ 34 ] The unique circumstances have not changed since Sulatycky J.’s Order of July 5, 2005. These circumstances require that Mr. Cole continue to have decision making power about matters for which he is obliged to pay 100 percent, pursuant to the July 5, 2005 Order. For greater clarity this now includes the children’s post-secondary education, including residency costs. [ 35 ] I dismiss Ms. Hearn’s application. I dismiss Mr. Cole’s counter-application. I order that Mr.

Cole continue to pay $800.00 per month child support, plus education and other extraordinary and ongoing expenses for the children, for so long as they remain children of the marriage. Heard on the 11 th and 12 th days of July, 2011. Dated at the City of Calgary, Alberta this 2nd day of October, 2011. P.J. McIntyre J.C.Q.B.A. Appearances: John C. Soby Q.C. Soby Boyden Lenz for Wendy Hearn Anthony Cole Self Represented