AJC v. TCC, 2011 ABQB 780

Court of Queen ’ s Bench of Alberta Citation: AJC v. TCC, 2011 ABQB 780 Date: 20111213 Docket: 4801 126843 Registry: Calgary Between: AJC also known as AJC-C Plaintiff - and - TCC Defendant Editorial Notice: On behalf of the Government of Alberta identifying information has been removed from this unofficial electronic version of the judgment. _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice R. J. Hall _______________________________________________________ [ 1 ] In this matter the Applicant mother seeks: (

a) Joint custody of the six year old child of the marriage, with her having primary parenting and residential day to day care and control;

(

b) A determination of the income of the husband or alternatively an imputation of the income of the husband for purposes of determining child support; (

c) A determination of s. 3 Child Support going forward; (

d) A determination of child support arrears; (

e) A determination as to what expenses qualify as s. 7 Extraordinary Expenses and the father’s proportionate share of those expenses; (

f) Confirmation of the Respondent’s obligation to make RESP contributions; (

g) A determination of spousal support arrears; and (

h) Severance of the divorce from corollary relief matters so that the divorce can proceed as a desk divorce. [ 2 ] The parties were married in February, 2004 and separated January, 2006. There is one 6 year old child of the marriage. [ 3 ] The parties entered into a Custody, Support and Property Agreement on April 24, 2007. Subsequent to entering that Agreement issues arose with respect to the parenting of the child, child support, spousal support and the matter of unsold merchandise in the company business run by the parties.

The parties agreed to mediate those issues; those matters that they were not able to agree upon were arbitrated under the Arbitration Act of Alberta. A decision was made by the arbitrator dealing with all matters. Primary care of the infant child was given to the mother. A parenting plan was set out. Child support and spousal support was determined. [ 4 ] Since then, however, the Respondent has indicated that he wishes to have shared parenting of the child on a 50 - 50 basis. The Respondent has not paid the full amounts awarded as child support and as spousal support.

The Respondent maintains that his income has decreased significantly from what was expected at the time of the arbitration, and that therefore his child support obligations and spousal support obligations should be revisited. The Respondent has not filed any cross application. He is self-represented. [ 5 ] The decision of the Arbitrator is as effective as if was an order of the Court.

However, the court can revisit issues of child care, child support, and spousal support if there has been a material change in circumstances that justifies a change or an adjustment to a previous court order, or to the arbitration award. (

a) Should The Applicant Continue To Have Primary Parenting Responsibilities? What Should be the Parenting Plan? [ 6 ] The Applicant has put forth medical evidence showing that the child suffers from extreme anxiety, has severely delayed social language skills, profound fine motor delay, poor gross motor skills and a cardiac murmur, amongst other diagnoses. The child’s paediatrician gives the opinion that the child is significantly impaired by these diagnoses and that they affect his life on a daily basis, academically, emotionally and behaviourally.

A report from the paediatrician indicates that the child requires stability within his home and school and that big changes in his routine would not be good for him. [ 7 ] The Respondent argues that he and the child have a very strong relationship and that he should be entitled to his full 50% share of parenting the child.

[ 8 ] This Court disagrees with the Respondent. The Court’s main concern is the best interests of the child. The medical report cautions against big changes in the child’s routine, and the request by the father for a change to 50/50 parenting would amount to such a big change. [ 9 ] Further, there has been no material change in circumstances brought to the Court’s attention that would justify the Court changing the decision of the Arbitrator in this matter. [ 10 ] The Arbitrator set out a parenting

schedule with which the Applicant is in agreement, and which the Court endorses. The parties shall have joint custody of the child. The Applicant shall have residential day to day care and control of the child. Parenting time with the Respondent shall be as follows: i. Alternate weekends from noon Thursday to 7:00 p.m. on Sunday or 6:00 p.m. on Monday in the event the weekend is a long weekend. ii.

Alternate Wednesdays during the week the Husband does not have alternate weekend access from noon to 7:00 p.m. when he is not out of town but if he is for a similar period of time as can be mutually agreed between the parties. iii. Two to three hours twice per week during the week that the Husband does not have alternate weekends when he is in town. iv.

Two consecutive weeks in the month of July and August for both parties in the event either of them wish to go on a holiday with the travelling parent to provide the non-travelling parent with a full travel itinerary along with the contact information and a notarized Consent to Travel to be provided by the non-travelling parent to the travelling parent. v. The right of first refusal for the parent not having the child in their care in the event that the parent who would normally have the child in their care is unable to care for the child.

In the event that the parent who would not have the child in their care is unable to care for the child then the parent who has the child in their care will make the child care arrangements at their own expense. vi. An equal sharing of Christmas holidays and the child’s spring break. vii. Other and alternate times as can be agreed upon by the parties. viii. Telephone contact between the child and the non-residential parent on a daily basis with such telephone access to take place in private. (

b) Income of the Respondent [ 11 ] The Arbitrator awarded child support of $425.00 per month to be paid by the Respondent to the Applicant. That amount translates under the Federal Child Support Guidelines to an income being imputed to the Respondent of $50,000.00 per annum. [ 12 ] The Applicant argues that, in his bankruptcy proceedings the Respondent indicated his expectation that he would earn $4,000.00 per month, net of taxes, on a go forward basis. The Applicant says that, grossed up for income taxes, that would result in a line 150 income of $56,657.00.

The Applicant seeks to have the Respondent’s income imputed at that amount. [ 13 ] The Respondent maintains that his business has suffered significantly, to the point where he was forced to enter into bankruptcy. He notes that his income tax returns have been produced and that they show income in 2008 of $31,825.00, in 2009 of

$23,830.00, and in 2010 an income of $85.33. He maintains that his income earning ability at present is approximately $20,000.00 per year, and he argues that his income should be set at that amount for purposes of calculations of child support and spousal support. [ 14 ] The Respondent states that his declaration in his bankruptcy proceedings of income of $4,000.00 net per month was his best estimate at the time but it has not proven to be achievable. [ 15 ] The Applicant questions the veracity of the income tax returns filed by the Respondent, asking how he could possibly survive on an income of $85.00 in 2010.

It is not alleged by the Applicant that the Respondent is deliberately under-employed; rather, she maintains his income is under-reported. [ 16 ] The Respondent is very experienced in his industry of sales of beautician and hair care products, a position in which he has demonstrated the ability to earn income of $50,000.00 per year in previous years. The Respondent maintains that his income earning ability has been affected by recession and, for various reasons which he details in his affidavit he is facing difficulties in getting back on his feet.

He admits that his debts have been extinguished as a result of his bankruptcy. [ 17 ] The level of income alleged by the Respondent is far lower than what should be anticipated a healthy male experienced in the industry should be able to achieve. I am not prepared to accept the Respondent’s position that he can only earn $20,000.00 per annum. I impute the Respondent’s income at $50,000.00 per annum. (

c) Section 3 Child Support Going Forward [ 18 ] In accordance with the child support guidelines, the Respondent shall pay $425.00 per month as s. 3 child support to the Applicant. (

d) Child Support Arrears [ 19 ] The Respondent was required by the arbitration decision to pay $425.00 per month in s. 3 child support payments. He did so until July, 2010. At that time he reduced his payments to $180.00 per month, without any order permitting him to do so. He is therefore in arrears in the amount of $4,390.00 in such s. 3 child support. There shall be judgment in such amount for these arrears. (

e) What Are the

Section 7 Expenses and What is the Respondent’s Share? [ 20 ]

Section 7 expenses shall be considered as all health and medical expenses including prescriptions, and the child’s school fees, extra incidentals at school and the milk program, which school costs total $454.00 per year. The Applicant’s annual income is set at $24,000.00. The s. 7 expenses shall therefore be split between the Applicant at 33% and the Respondent at 67%. (

f) RESP Payment Obligations of the Respondent [ 21 ] In the Agreement between the parties reached April 30, 2007, there was a provision in paragraph 41: The parties agree that they shall each make contributions to an RESP account for the Child in the sum of $1,000.00 per year commencing in 2009 and continuing for so long as allowable under the RESP program guidelines. [ 22 ] That provision in the Agreement was not altered or effected by the decision of the Arbitrator. It continues to be a contractual

obligation of the Respondent. The Respondent says that he has not made those payments, maintaining that he could not afford to do so. [ 23 ] Nevertheless, the Respondent had undertaken that obligation and is contractually obliged to make those payments. He is in arrears in the payments for 2009 and 2010. He has a continuing obligation to make the payments in the future. (

g) Spousal Support [ 24 ] The arbitration award directed that the Respondent pay spousal support in the amount of $1,000.00 per month for 40 months. This is an unusually high award given the age of the Applicant and the length of the marriage (under 2 years). However, it is explained, to some extent in the Arbitrator’s reasoning, that it is not so much an award of spousal support as it is a division of inventory owned by the two parties at the time of the marriage collapse.

The spousal support payments were intended to be payment to the Applicant of her share of that inventory, such payment to be made over time. [ 25 ] The Applicant maintains that the Arbitrator’s award should be upheld in that regard and not revisited, as it is filed as a spousal support award, but in fact was a retirement of a matrimonial debt. [ 26 ] The Respondent acknowledges that the spousal support award was intended to deal with this inventory issue. He maintains, however, that he has not been able to sell the inventory.

He offers to transfer the inventory to the Applicant in retirement of this obligation. [ 27 ] It seems to be that nobody wants the inventory. It is getting more and more dated, and there is a lot of work involved in trying to sell it, at an unknown price. [ 28 ] Were this a spousal support award, the Court would review it. However, in that circumstance, the Court would not be able to identify any material change in circumstances that would warrant adjusting that award. [ 29 ] In the event that this is an award dealing with matrimonial property, it is not an award which the Court is at liberty to disturb.

The arbitration award is a final one, and it was never appealed. [ 30 ] Therefore, on either basis, this Court finds that the Respondent has a continuing obligation to the Applicant to make payments in the amount of $1,000.00 per month. The Respondent has made some payments to the Applicant, but he is in arrears in the amount of $11,000.00. The Applicant shall have an award of spousal support arrears in the amount of $11,000.00. Spousal support shall be ongoing at the rate of $1,000.00 per month until the expiry of the 40 months ordered by the Arbitrator. (

h) Severance of the Divorce Proceedings [ 31 ] The parties have indicated their agreement that the divorce proceedings be severed from the corollary relief issues, and I have accordingly made that order. (

i) Costs [ 32 ] The Applicant has been successful in this application. The Applicant is awarded costs of this Special Application in the amount of $750.00 plus reasonable disbursements incurred.

Heard on the 1st day of December, 2011. Dated at the City of Calgary, Alberta this 13th day of December, 2011. R. J. Hall J.C.Q.B.A. Appearances: Margaret Bodeau-Tang of Spier Harben for the Plaintiff/Applicant TCC - Self-represented for the Defendant/Respondent