Woito v. Lajoie (Woito), 2012 ABQB 103

Court of Queen ’ s Bench of Alberta Citation: Woito v. Lajoie (Woito), 2012 ABQB 103 Date: 20120214 Docket: 4803 151881 Registry: Edmonton Between: Robert Wilbert Woito Plaintiff - and - Carole Lucille Lajoie (Aka Carole Lucille Woito) Defendant _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice R.A. Graesser _______________________________________________________ Nature of Application [ 1 ] This is an application by Robert Woito to cancel all arrears in spousal support and set ongoing spousal support at nil. The application is opposed by Ms. Woito.

The application was heard on December 20, 2011. Mr. Woito advised at the commencement of the application that he had made a settlement proposal to Ms. Lajoie and had not heard back from her. Mr. Krys, appearing for Ms. Lajoie, confirmed that a proposal had been made and that he had not been able to get instructions from his client. [ 2 ] The application proceeded to be heard on the merits. I heard arguments from Mr. Woito and from Mr. Krys, and requested further information from Mr. Woito as to his recent bankruptcy as well as for information from the corporation he now works for. I asked Mr.

Krys to advise as to Ms. Lajoie's response to the settlement offer so that I would not have to make a decision on the application

if it was settled. [ 3 ] Mr. Krys has since advised that Mr. Woito's settlement offer has been rejected. Mr. Woito has provided information from the Office of the Superintendent of Bankruptcy that a trustee was appointed for him on June 15, 2009. [ 4 ] Mr. Woito has also filed a supplemental affidavit sworn January 26, 2010 attaching financial statements for his employer for 2010 and 2011. An affidavit was provided by Caroline P. Black sworn January 26, 2012 providing information concerning the company that employed Mr. Woito. [ 5 ] In correspondence to the court since the application was heard, Mr.

Woito asked the Court to direct Ms. Lajoie to provide her financial information from 2005 to present, as well as financial information on Ms. Lajoie's new partner. Mr. Woito stated in his letter of January 3, 2012 that he was making the request because "the courts have allowed Mr. Krys latitude in granting his request for the financial statements of 1468087 Alberta Ltd. based on me being an agent of the corporation. [ 6 ] Before I had the opportunity to reply to Mr.

Woito's request for such financial information, he wrote the Court on January 28, 2012, stating "I wish to end this and ask you to make a decision". [ 7 ] Mr. Woito made no formal application for any production of information from Ms. Lajoie's new partner. There is no proper basis for such an application at this stage, as there is nothing in the evidence before me as to the existence of a new partner for Ms. Lajoie. The new partner issue arises out of Mr.

Woito's submissions and not his affidavit evidence. [ 8 ] The order requiring production of the corporation's financial statements, on the other hand, followed an application with a supporting affidavit from Ms. Lajoie. Mr. Woito was shown on corporate records as "agent of corporation"; thus the previous direction that financial information from the corporation be produced. Background [ 9 ] Mr. Woito and Ms. Lajoie were married in 1984 after approximately 2 years cohabitation. They separated on May 31, 2003. They have two children, now aged 25 and 22.

The corollary relief issues were tried in the Ontario Superior Court of Justice in Thunder Bay, Ontario. After a three day trial in January, 2009, Madam Justice H.M. Pierce issued a lengthy written decision on April 1, 2009 in Court File No. FS-07-0206. [ 10 ] In her judgment, Pierce J. granted Ms. Lajoie retroactive spousal support of $1,500.00 per month from January 1, 2007 to December 31, 2008, and permanent spousal support of $2,500.00 per month commencing January 1, 2009. She awarded Ms. Lajoie an equalization payment of $10,505.89 with respect to the property division.

Costs of some $6,000.00 were also awarded to Ms. Lajoie. This application relates only to the spousal support aspects of the decision. [ 11 ] Pierce J. found that Mr. Woito's base income at the time of trial was $116,307. He was expected to earn overtime, bringing his anticipated total income to $130,000. Ms. Lajoie's projected income was set at $12,000.00 for 2009 (and ongoing). [ 12 ] As for retroactive spousal support, she noted that Ms. Lajoie had not supported the children, who had continued to live with Mr. Woito, after the separation, and she offered no explanation for not pursuing spousal support earlier.

Ms. Woito had earned between $8,000.00 and $12,000.00. She found that Mr. Woito had earned $129,163.00 in 2007 and $136,130.00 in 2008. She noted that Mr. Woito had received a second class stationary engineering ticket in 2008. She awarded retroactive spousal support to January 1, 2007 at $1,500.00 per month, characterizing Ms. Lajoie as having lived at a "subsistent level."

[ 13 ] It appears that little of the spousal support has ever been paid. According to Mr. Woito's application, he owes $124,811.97 and is paying $800.00 on arrears. [ 14 ] Mr. Woito's affidavit sworn December 2, 2011 states that he expects to earn $30,000.00 "this year". His affidavit states that he will be looking for employment in his field "now that he has his driver's licence back" (presumably referring to the suspension of his licence because of Maintenance Enforcement Program actions). [ 15 ] He stated that he has been doing volunteer work building trails and doing community services.

He attached his T 4 for 2009, showing employment income of $61,514.56 and his tax return for 2010 showing income of $10,382.00. [ 16 ] He stated that his health has declined, and attached chart notes from his doctor showing that he had high blood pressure in August 2010 and November 2010, noting "bad divorce" and "discussed divorce of wife in Quebec". [ 17 ] Mr. Woito's confirming letter for the application, dated December 2, 2011, provides background on the matter, including concerns over the Pierce J.'s decision.

He chronicles his difficulties since the April 1, 2009 decision. [ 18 ] He stated that the April 1, 2009 put him in financial stress, and that caused a relationship breakdown and to him quitting his job. Since quitting his job, he did volunteer work as he did not consider himself mentally fit to work. He began to work again in the fall of 2010. Position of Parties Mr. Woito [ 19 ] Mr. Woito argues that he cannot afford to pay the spousal support as ordered, and that he could never afford to pay it. He argues that Ms. Woito is capable of providing for herself as she has been able to upgrade her skills.

The latter was a position taken at trial, and which was rejected by Pierce J. Ms. Lajoie [ 20 ] Ms. Lajoie opposes the application, and asks that it be dismissed. [ 21 ] Mr. Krys, on behalf of Ms. Lajoie, argues that there has been no unforeseeable, non-transitory and significant change in circumstances. He notes that Mr. Woito has not proven that he suffered from a mental illness, and there is no evidence that Mr. Woito sought mental health care to maintain his job. [ 22 ] He also argues that Mr.

Woito voluntarily quit his $137,000 per year job, and even if he was suffering from some mental illness, that illness has ceased since at least February, 2011 when he began to apply for power engineering positions again. [ 23 ] Mr. Krys also argued that Mr. Woito has not substantiated the absence of an interest in the company he was working for, or that the company was not making substantial sums. That argument has fallen away, having regard to the production of the company's financial statements after the application was heard. Law

[24] The starting point in the legal analysis relating to variation in spousal support orders is s. 17(4.1)of the Divorce Act, R.S.C.1985, c. 3 (2nd supp.) which states: Factors for spousal support order

(4.1) Before the court makes a variation order in respect of a spousal support order, the court shall satisfy itself that a change in thecondition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order or thelast variation order made in respect of that order, and, in making the variation order, the court shall take that change into consideration. [25] The starting point in the case law is Moge v. Moge, (SCC), [1992] 3 S.C.R. 813.

This is not a situation whereone of the parties is seeking to vary an order that resulted from an agreement of the parties, as was the case in Miglin v. Miglin, 2003SCC 24 and the recent decisions in L.M.P. v. L.S., 2011 SCC 64 and R.P. v. R.C., 2011 SCC 65. [26] As a result, the test is whether or not there has been a material change in circumstances since the time of the April 1, 2009decision. [27] Material change is defined at para. XX in Sopinka J.'s decision in Willick v.

Willick, (SCC), [1994] 3 S.C.R.670: In deciding whether the conditions for variation exist, it is common ground that the change must be a material change of circumstances.This means a change, such that, if known at the time, would likely have resulted in different terms. The corollary to this is that if thematter which is relied on as constituting a change was known at the relevant time it cannot be relied on as the basis for variation. [28] That test was confirmed as being appropriate for spousal support variation claims in G.(L.) v.

B.(G.), (SCC),[1995] 3 S.C.R. 370, at paras. 48: 48 Variation of support orders is governed by s. 17 of the current Act. Section 17(4) states that before it varies a support order "thecourt shall satisfy itself that there has been a change in the condition, means, needs or other circumstances of either former spouse or ofany child of the marriage". This provision applies to any variation of a support order, whether in favour of a spouse or of the children.Consequently, the test developed in Willick v.

Willick, (SCC), [1994] 3 S.C.R. 670, in connection with support forchildren applies mutatis mutandis to the variation of spousal support. To begin with, the judge must determine whether there has been achange in the parties' situation since the last support order. [29] The court went on to discuss the nature of such changes in paras. 49 - 51: 49 What sort of change is appropriate? Willick, supra, explained what is meant by "change".

Sopinka J. said the following (at p. 688): In deciding whether the conditions for variation exist, it is common ground that the change must be a material change of circumstances.This means a change, such that, if known at the time, would likely have resulted in different terms.

The corollary to this is that if thematter which is relied on as constituting a change was known at the relevant time it cannot be relied on as the basis for variation. 50 In that same decision I made the following observations (at pp. 733 34): In my view, having regard for the wording of s. 17(4) of the Act, the preliminary threshold test ensures that . . . support orders will not be

In my view, having regard for the wording of s. 17(4) of the Act, the preliminary threshold test ensures that . . . support orders will not bereassessed by courts anytime a change, however minimal, occurs in the circumstances of the parties or their children. This approachrecognizes the value in some degree of certainty and stability between the parties. Parties must be encouraged to settle their difficultieswithout coming before the courts on each and every occasion.

Nonetheless, the threshold test cannot be applied properly unless thesufficiency of the change in circumstances is evaluated against the backdrop of the particular facts of the case at hand. It is important topoint out that the Act does not qualify "change" but merely states that "the court shall satisfy itself that there has been a change". . . .[Emphasis in original.] 51 As to what change is sufficient, I went on to say (at p. 734): To begin with, "sufficiency" of the "change" must be defined in terms of the parties' overall financial situation.

Moreover, the fact that achange was objectively foreseeable does not necessarily mean that it was contemplated by the parties. Finally, although any changewhich is not contemplated may be considered by a judge to be sufficient, it is obvious that not every change will justify variation.

Mostimportantly, however, and notwithstanding the above observations, while the onus of proving the sufficiency of the change in condition,means, needs or other circumstances rests upon the applicant . . ., the diversity of possible scenarios in family law dictates that courtsmaintain a flexible standard of judicial discretion which does not artificially limit the adaptability of the Divorce Act provisions.[Emphasis in original.] [30] The test for material change was recently confirmed in L.M.P. v. L.S., where Willick and G.(L.) v.

B.(G.) were cited withapproval by the majority at paras. 30-34. [31] At para. 35, the majority held: 35 In general, a material change must have some degree of continuity, and not merely be a temporary set of circumstances (seeMarinangeli v. Marinangeli, (2003), (ON CA), 66 O.R. (3d) 40, at para. 49). Certain other factors can assist a courtin determining whether a particular change is material. The subsequent conduct of the parties, for example, may provide indications as towhether they considered a particular change to be material (see MacPherson J.A., dissenting in part, in P. (

S) v. P. (R.), 2011 ONCA 336,332 D.L.R. (4th) 385, at paras. 54 and 63). [32] It is clear that the onus of proving a material or sufficient change in circumstances is on the applicant on the application, soMr. Woito bears the burden of proving that there have been material changes in the parties' circumstances since the April 1, 2009decision. Analysis [33] Mr. Woito claims that the change in his earnings amounts to a material change in circumstances. There is no doubt that hisincome in 2009 declined by more than 50% from his income in 2008. His income changed because he gave up his well paying job.

Healso declared bankruptcy in June, 2009. These are all significant changes in his circumstances. The fact that there have been significantchanges does not, however, automatically entitle Mr. Woito to a variation in support. [34] The court must also analyze the reason for the changes. And in considering the effect of the changes, the court must alsoconsider whether the changes are permanent or temporary. Here, the evidence suggests that Mr. Woito may be able to regain his formertype of employment as a power engineer, so that his present earning expectations of $30,000.00 per year may be temporary. [35] Mr.

Woito acknowledges that he quit his job. His explanation for doing so is that he was so upset at the April 1, 2009 decisionand the economic impact it had on him, he could not sleep. That in turn caused the relationship he was in to fail, and his troubled mentalstate caused him to be concerned for his and his co-workers' safety on the job. So he quit his well paying job.

He was then not in a fitmental state for the balance of 2009 and most of 2010 to seek gainful employment. [36] His explanation is not supported by any evidence other than an excerpt from his doctor's chart in 2010 that he was sufferingfrom high blood pressure. There is no evidence from 2009, and no indication that Mr. Woito sought treatment for his disturbed mentalcondition. There is also no medical or independent evidence suggesting that Mr. Woito was not fit for gainful employment, or

employment in his field as a power engineer, for any period, let alone from April, 2009 to February, 2011. [ 37 ] The impression from his affidavit and his brief letter is that he was so upset by the April 1, 2009 decision that he could not focus on anything else. Within a short time, he quit his job and filed for bankruptcy. [ 38 ] A significant issue that is not resolved by the evidence in this matter is the extent to which Mr. Woito's response to Pierce J.'s decision can be used as a material change in circumstances.

Absent medical or other independent evidence recognizing the response, the effect of the response and potentially explaining the absence of treatment for the response, I do not see that Mr. Woito's self-description and analysis of his situation can be used to justify his quitting his job and putting himself in a financial position where he was unable to meet his obligations. [ 39 ] There is nothing in the evidence before me, and there is nothing in Pierce J.'s decision, suggesting that Mr.

Woito was in a difficult way with his creditors at the time of the trial, or that his financial position had deteriorated after the parties separated. He had an income of over $130,000. per year, and had enjoyed a similar income for some time before the trial. Mr. Woito was given credit in the property aspect of the trial for payment of joint debts by him, and the equalization payment ordered was $10,500.00. [ 40 ] If it is determined that Mr.

Woito was simply upset with the decision and decided to quit his job and go bankrupt to thwart collection of the amounts ordered, that circumstance is unlikely to amount to a material change in circumstances under s. 17(4.1) of the Divorce Act or within the definition in Willick which would relieve Mr. Woito from all or any significant part of the award against him. [ 41 ] There are three aspects to this case. First, there is the issue of retroactive support, that is the support ordered by Pierce J. to the date of trial.

Second, there is the issue of arrears to the date of the application to vary resulting from the support ordered following the trial. Thirdly, there is the issue of ongoing support following this application. Support to the Date of Trial [ 42 ] The effect of her decision was to award Ms. Lajoie $36,000.00 in retroactive support to December 31, 2008, and then an additional $10,000.00 to and including the date of trial. In addition to the $10,500.00 equalization payment, Mr. Woito was immediately indebted to Ms. Lajoie in the amount of another $46,000.00. [ 43 ] There is no evidence that Mr.

Woito appealed the Ontario decision, or that he took any steps to make arrangements for payment or paid anything. Instead, in short order after the decision, he quit his job and declared bankruptcy. [ 44 ] Mr. Woito cannot succeed in this court to vary or reduce the amount of retroactive support ordered by Pierce J. to the date of her decision. To vary the retroactive award would essentially be an end run around the decision. His circumstances had not changed between the trial and the decision, as it appears that it was the decision itself that triggered Mr.

Woito's subsequent problems. [ 45 ] I make no comment on the effect Mr. Woito's June, 2009 bankruptcy had on the amount owed to Ms. Lajoie and whether any portion of the support ordered by Pierce J. was discharged. That is a matter for the bankruptcy court. [ 46 ] It is clear that at least a year's worth of arrears would survive bankruptcy, and bankruptcy by itself would have no impact on the ongoing spousal support obligation. [ 47 ] Mr. Woito has not satisfied me that there has been a material change in his circumstances between April 1, 2009 and his bankruptcy in June, 2009.

He may well have become upset and obsessed with Pierce J.'s decision to the point of distraction and poor mental health, and driving his blood pressure up, but in the absence of clear medical evidence relating to that period, I do not see that the circumstances amounted to a material change in circumstances, considering the "permanent" part of the Willick test, between April 1,

2009 and June 15, 2009 when he declared bankruptcy. [ 48 ] Mr. Woito did not immediately quit his job; the T-4 from his employer suggest that he worked about half of 2009 as he earned $61,514.56. That suggests that he may have worked until approximately June of 2009. In any event, it is not unreasonable, on his $61,500.00 income for that part of the year, for him to be obliged to pay $15,000.00 (6 months at $2,500.00 per month) to Ms. Lajoie. [ 49 ] I make no adjustment for the period from the decision until the date of bankruptcy. [ 50 ] I make no decision on the level of Mr.

Woito's arrears to the date of his bankruptcy. That will have to be determined in other proceedings, if there is an issue. I do hold, however that whatever those arrears are, they are not affected by subsequent changes in circumstances of either party. The arrears surviving bankruptcy, accruing to the date of bankruptcy, are not varied and may be enforced. Payment of $800.00 per month on the arrears does not seem unreasonable. Arrears from Trial to Variation Application [ 51 ] The second issue is the question of arrears from the date of Pierce J.'s decision to the date of this application.

Ongoing support at $2,500.00 per month from May 1, 2009 to December, 2011 totals $70,000.00. Over that period, Mr. Woito's evidence is that he made approximately $25,000.00 from employment, apart from what he made before he quit his job in 2009 after the decision. [ 52 ] While his circumstances have changed as a result of the job loss and bankruptcy, Mr. Woito has not met the onus of proving that there has been a material change in his circumstances to warrant a variation in his spousal support obligations.

He bears the onus, and the evidence he has put forward does not satisfy me that he is entitled to any variation. [ 53 ] I am, however, satisfied that there may have been a material change in Ms. Lajoie's circumstances. Pierce J. described Ms. Lajoie as living in subsistent conditions. She referred to "an impoverished lifestyle" in another portion of her judgment. At the time of the trial, there was no evidence that Ms. Lajoie was living with anyone else. She now apparently has a new partner, according to Mr.

Woito's materials. [ 54 ] Although the spousal support was described as "permanent", Pierce J. noted in para. 100 of her decision that if Ms. Lajoie's circumstances materially change, there might be a variation application. [ 55 ] Having a new partner may be a material change, depending on the nature of the relationship and the ability of the new partner to contribute to household expenses. Ms. Lajoie's needs may have been reduced (or met other than through support from Mr. Woito). [ 56 ] In his submissions on this application, Mr. Krys, on behalf of Ms. Lajoie, asked the court to either dismiss Mr.

Woito's application or to adjourn it "to give him (Mr. Woito) an opportunity to provide better evidence of his mental history". [ 57 ] That is appropriate, in the circumstances of this case. It is also appropriate, having regard to the fact that Ms.Lajoie's circumstances may have changed as a result of having a new partner, for her circumstances to be explored as well. [ 58 ] Mr. Woito requested production of financial information from Ms. Lajoie's new partner.

That request is not part of the application before me as there is no specific application filed in that regard, nor is there any affidavit evidence as to Ms. Lajoie having a new partner. There is no information as to when the new partner entered Ms. Lajoie's life and what date there may have been a material change to her circumstances. [ 59 ] Production of financial information from the new partner was not argued before me, and I decline to order it in the absence of Ms. Lajoie facing a properly-filed application and supporting materials in that regard, and without the opportunity to consider the

application (or request) and respond. [ 60 ] Nevertheless, in the absence of medical or other independent evidence from Mr. Woito as to his mental state following the decision and its impact on his ability to earn a living, and evidence as to the existence of a new partner for Ms. Lajoie (and his contribution if any to her cost of living), there is not enough information for me to make any determination on whether there should be a variation in spousal support from the date of bankruptcy to the date of the application. [ 61 ] In that regard, Mr. Woito's application is adjourned sine die .

Ongoing Spousal Support [ 62 ] Mr. Woito's circumstances may have materially changed. Ms. Lajoie's circumstances may have changed too. As a result, there is insufficient information for me to make a decision on ongoing spousal support. In the trial before Pierce. J. in 2009, Ms. Lajoie established her entitlement to spousal support on the basis of compensatory support as well as need.

Having regard to the length of the marriage and the ages of the parties, Pierce J. described her order as "permanent" with no time limits, leaving variation to s. 17(4.1) and material change in circumstances. [ 63 ] The issue of compensatory entitlement was already decided by Pierce J. and is res judicata . Quantum and duration may be adjusted based on any material changes in the party's circumstances. But that will have to be on a fuller evidentiary foundation. Mr. Woito's application to vary ongoing support is also adjourned sine die .

Summary [ 64 ] Mr. Woito's application to vary Pierce J.'s order of April 1, 2009 is dismissed as it relates to the period to June 15, 2009, the date of bankruptcy. [ 65 ] This decision does not address the amount of spousal support, either the retroactive support ordered to December 31, 2008 or the ongoing spousal support ordered from January 1, 2009, which survived Mr. Woito's bankruptcy. [ 66 ] That may be something that can be worked out through the Maintenance Enforcement Program; otherwise Mr.

Woito may have to make an application for a determination of the amount of spousal support which survived his bankruptcy. [ 67 ] Mr. Woito's application to vary spousal support as it relates to the period after June 15, 2009 is adjourned sine die . [ 68 ] For that application to be heard on its merits, Mr. Woito will require further medical or independent evidence supporting his claims that he was mentally (or medically) not fit for employment after June, 2009, and for what period, and the extent to which his health may affect his employability and earning capacity in the future.

Further evidence from him is necessary to establish the existence of a new partner for Ms. Lajoie. In such circumstances, Ms. Lajoie may be required to provide evidence of her new partner's ability to contribute to her ongoing cost of living. I make no finding to that effect at this stage. The nature and extent of any such disclosure is left to be determined by a properly prepared application supported by appropriate evidence. [ 69 ] I make no direction on timing or any steps. It is up to Mr.

Woito to decide if he wishes to pursue the application further, and if so, the nature and extent of any further evidence he wishes to adduce. Ms. Lajoie needs to respond only after such further evidence is introduced by Mr. Woito, or he brings an application to compel disclosure of financial information from Ms. Lajoie and/or her new partner.

[ 70 ] Both Mr. Woito and Mr. Krys indicated at the December 2010 application that there were some settlement discussions. I encourage the parties to continue those discussions. Stay [ 71 ] The matter of any ongoing stay or enforcement was not argued before me. On the arrears, I see no reason at this stage to interfere with the stay of enforcement remaining in place on condition that payments of $800.00 per month on the arrears continue. I make no finding as to what those arrears are. [ 72 ] As to ongoing spousal support, Mr.

Woito's obligations as ordered by Pierce J. continue as they have not been varied in this decision. Those payments are $2,500.00 per month. In my view, ongoing payments should be stayed until March 31, 2012 to allow for further settlement discussions. Failing settlement, there should be some time for Mr. Woito to put forward additional evidence to support his application, and to bring an application for production of financial information from Ms.

Lajoie and her new partner. [ 73 ] An application for a stay of enforcement beyond March 31, 2012 should be brought on proper notice and with appropriate supporting materials. I will seize myself with the procedural aspects of the variation application (including production issues) and any stay applications pending the hearing of the variation application. I do not seize myself with the variation application itself. Heard on the 20 th day of December, 2011. Dated at the City of Edmonton, Alberta this 13 th day of February, 2012. R.A. Graesser J.C.Q.B.A.

Appearances: Robert Woito appeared on his own behalf William Krys for the Defendant