Toliver v. Koepke, 2012 ABQB 307

Court of Queen ’ s Bench of Alberta Citation: Toliver v. Koepke, 2012 ABQB 307 Date: 20120510 Docket: 4803 132898 Registry: Edmonton Between: Rachelle Ann Toliver Plaintiff - and - Murray Elwood Koepke Defendant Editorial Notice: On behalf of the Government of Alberta personal data identifiers have been removed from this unofficial electronic version of the judgment. _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice D.C. Read _______________________________________________________

Summary:

[ 1 ] The parties were husband and wife. After unhappy differences arose, they separated and started dissolution proceedings respecting their marriage. Both had counsel. After attending a JDR, they met together with their counsel to discuss settlement ("Settlement Meeting"). Ms. Toliver asserts that the parties agreed at that meeting to settle all outstanding issues between them. Mr. Koepke says there was no settlement. By order they proceeded to trial by viva voce evidence on the issue of whether or not a settlement agreement was concluded between the parties.

Facts: [ 2 ] The parties married on October 12, 1996 and divorced on June 26, 2007. It was a second marriage for both. There are two children for whom Mr. Koepke stood in loco parentis . Bridgette was born May [...], 1987 and Nicole was born July [...], 1990. Mr. Koepke also had a daughter, Leanne, from another relationship but she did not live with the parties. [ 3 ] When the parties became engaged, Mr. Koepke put his home up for sale and made plans to move into Ms. Toliver's acreage home in Sherwood Park. Ms. Toliver's home became the parties' matrimonial home ("Matrimonial Home"). [ 4 ] Unfortunately, Mr.

Koepke was in a car accident shortly before the wedding and suffered a serious head injury, along with other injuries. After they married, Mr. Koepke's head injury caused personality changes and behaviour difficulties which led to difficulties in the marriage and with the children. The difficulties caused by the head injury were instrumental in the parties' separation on February 5, 2003. [ 5 ] Because of Mr. Koepke's condition, Ms. Toliver helped him finalize the sale of his home and during the marriage, generally took control of the parties' finances. [ 6 ] At first, the parties were told Mr.

Koepke's injuries would be temporary but eventually, it became apparent they were permanent. Mr. Koepke has not worked since the accident. He received a lump sum WCB impairment award. In addition he receives a monthly disability annuity from WCB. Ms. Toliver continued her employment with the Government of Alberta, working full time. She has contributed to two pensions: one accrued prior to the marriage; contributions to the other commenced before the marriage but continued during the course of the marriage. Ms. Toliver also had RRSPs, a vehicle, and bank accounts.

During the marriage, the mortgage on the Matrimonial Home was paid out. When they first married, the parties purchased a hot tub, which was installed at the Matrimonial Home, to aid Mr. Koepke with his various injuries. Mr. Koepke asserted that part of his WCB impairment award was used to purchase this hot tub. In addition, Mr. Koepke had a small GIC. He asserted, further, a claim for exemptions for the net equity in his home, sold just before the marriage, and for the lump sum WCB payment. [ 7 ] After their separation, Ms. Toliver retained Mr. Barry King as counsel in the divorce and Mr. Koepke retained Ms.

Karen Anderson. Ms. Toliver commenced a divorce and division of matrimonial property action on October 15, 2004. Mr. Koepke commenced a claim for judicial separation and division of matrimonial property on November 10, 2005. The issues between the parties were: division of matrimonial property, exemptions, spousal support for Mr. Koepke; and child support for both Bridgette and Nicole. [ 8 ] There was extensive discovery and disclosure and the parties prepared for trial, set for the beginning of May, 2006.

Just prior to trial, in an effort to settle, the parties attended a judicial dispute resolution meeting ("JDR") before Justice J. Watson (as he then was) on April 5, 2006. Both parties prepared JDR briefs, including property statements, setting out the party's position respecting division of property and other issues. After obtaining some direction from Justice Watson at the JDR, the parties met, together with their counsel, at Ms. Anderson's office during the afternoon of April 6, to discuss possible resolution. [ 9 ] The Settlement Meeting lasted all afternoon. Both Ms. Toliver and Mr.

Koepke gave evidence of what they remembered about that meeting. So too, did Mr. King. Mr. Koepke elected not to call his former counsel Ms. Anderson for reasons I will detail below. [ 10 ] On May 17, 2006, Ms. Anderson filed a Notice of Ceasing to Act. Thereafter, Mr. Koepke was unrepresented for some time before retaining his present counsel.

[ 11 ] No minutes of settlement or other written agreement were ever executed by the parties. [ 12 ] Mr. King continued to act for Ms. Toliver for a period of time afterwards and appeared before Justice F. Slatter (as he then was) on September 15, 2006, on an application to confirm the terms of the settlement agreement which Ms. Toliver asserted the parties had reached and to sever corollary relief to obtain a divorce. [ 13 ] Slatter, J. made an order severing corollary relief and permitting the divorce to proceed as a desk divorce. As well, he ordered discharged a lis pendens filed on behalf of Mr.

Koepke against the Matrimonial Home, that the amount of $115,000 ("Settlement Funds") be paid into trust by Ms. Toliver, and that $5,000 of these funds be released to Mr. Koepke's new counsel once retained. To obtain the funds to pay into Court, Ms. Toliver borrowed $115,000 on a line of credit. This loan attaches the Matrimonial Home as collateral and attracts interest at prime plus one percent. The funds, with the exce ption of the $5,000 released to Mr.

Koepke, were ultimately paid into Court to an interest bearing account where they remain. [ 14 ] On September 13, 2007, Moreau, J. ordered a trial of an issue: whether there was a settlement agreement between the parties. On January 8, 2008, Macklin, J. ordered the matter into case management and assumed case management duties. Mr. King ultimately ceased to act for Ms. Toliver after an order by Justice Macklin and she retained her present counsel. On May 15, 2009, Justice Macklin affirmed that the only issue for trial was "whether an agreement was reached or concluded between the parties".

He specifically ordered that the issue of whether the agreement, if reached, was unconscionable would not be dealt with at this trial but could be at a later time. [ 15 ] These reasons relate, therefore, only to the trial of the issue of whether an agreement was reached or concluded between the parties. [ 16 ] At the commencement of this trial, the parties clarified that the issue was whether or not the parties had reached an agreement as contemplated in s. 8 (

g) of the Matrimonial Property Act , RSA 2000, c. M-8 as am. (the " Act "). It was acknowledged that the requirements of s. 37 and s. 38 of the Act have not been met and that whether the agreement, if reached, was enforceable was not before the Court. [ 17 ] Ms. Toliver asserts that the parties reached agreement at the Settlement Meeting, but that Mr. Koepke has since reneged on the agreement and refuses to put it into effect. Mr. Koepke asserts that no agreement was reached, arguing that the parties were never ad idem respecting fundamental terms. He says, at most, they reached only an agreement to agree.

Alternatively he argues that the terms of the agreement were so uncertain as to be unenforceable. [ 18 ] Mr. Koepke wished to call Ms. Anderson, his former counsel, to give evidence only about her memory of what occurred at the Settlement Meeting. He wished to maintain privilege and disable her from answering any questions about anything either before or after the meeting on the grounds that actions she took were or could be the result of advice and instructions subject to solicitor-client privilege. I issued a mid-trial decision concluding that if Mr. Koepke called Ms.

Anderson as a witness, he could not artificially limit her evidence to only one part of the events. I found that if he called Ms. Anderson he would impliedly release solicitor-client privilege also in respect to events that occurred before, during, and after the Settlement Meeting, including actions Ms. Anderson took on her client ’ s behalf. I found this would be so even though such testimony could reveal her instructions or advice. I found further, that provided Mr. Koepke did not further release privilege because of questions asked of Ms.

Anderson by his counsel, other than this limited release, privilege would otherwise remain intact and no questions could be asked about her advice or his instructions. I gave reasons for this decision verbally at the trial. [ 19 ] Before considering the evidence about what occurred at the Settlement Meeting, I will comment generally on credibility. For all parties, this meeting, occurring some five years previously, was a rather distant memory by the time of trial. Although both Ms. Toliver and Mr. King had made notes, these were incomplete and cryptic.

Both also had a copy of a matrimonial property statement, which evidence showed had been drafted by Ms. Anderson, and each had made notations on their copy. However, both witnesses had difficulties with the meaning of at least some of the numbers and notations in their notes and neither was able to completely answer questions about what values had been agreed to for specific items. Mr. King did not draft any memo to his own file nor write to Ms. Anderson to confirm his understanding of the agreement he says they reached.

[ 20 ] Mr. Koepke took no notes at the meeting and it was clear from his testimony that his memory is poor and his comprehension somewhat limited. The injuries he suffered in the accident have much affected him and, as he said, his thinking was "all mixed up" and his memory about some things continues to be poor. He said that in some areas he believes his memory about what occurred has improved since the Settlement Meeting but agreed that this could be because he had read things or spoken to others.

His testimony about what happened at the Settlement Meeting was fragmented, sometimes contradictory and often difficult to follow. He had difficulty recalling sequence of events and much of what occurred at the meeting, according to Ms. Toliver and Mr. King, was not commented upon by Mr. Koepke in his testimony. In contrast, his memory respecting some specific events or subjects, particularly issues about which he felt strong emotion was detailed and specific but seemed illogical in context. [ 21 ] In general, where their accounts differ, I conclude that Mr. King's and Ms.

Toliver's evidence is more reliable and therefore more credible than the evidence of Mr. Koepke. Ms. Anderson's evidence would doubtless have been helpful in resolving contradictions. [ 22 ] Ms. Toliver and Mr. King both testified that the parties used as a foundation for their discussion, the matrimonial property statement originally drafted by Ms. Anderson for the JDR. This statement was called 'sheet one' in the JDR brief and was in the chart form, commonly used for such statements.

In the left hand column was a list of the parties' assets, a list of their liabilities, and a list of suggested tax adjustments to be made. A list of exemptions followed. The statement ended with totals netted after exemptions and with a number termed 'equalization payment'. There were four columns to the right of the first column. The first was headed 'Husband', the second 'Wife', and the third 'total'. Each of these three columns contained numbers. The fourth column did not have a title but appears to contain comments about the date or basis upon which the numbers in the previous three columns were established.

Their evidence was that Ms. Anderson changed some of the numbers on sheet one as a consequence of directions and suggestions made by Justice Watson at the JDR that morning and that the parties used this amended form of sheet one as the basis for their discussions that afternoon. For ease of reference, I will call this document "Amended Sheet One". Mr. Koepke said, at one point in his testimony that he had seen Ms. Anderson prepare Amended Sheet One, although he later contradicted this evidence. [ 23 ] Both Ms. Toliver and Mr.

King said that the guidance offered by Justice Watson at the JDR respecting some issues had enabled the parties to take some issues off the negotiating table. The evidence of all three witnesses was that the parties accepted Justice Watson's suggestion that spousal and child support should be calculated to begin effective December 1, 2004. All testified that they also accepted Justice Watson's suggestion that spousal support for Mr. Koepke should continue until his 55th birthday (June [...], 2015).

As well, they accepted Justice Watson's suggestion that child support for Bridgette, the older child, would be calculated only until June, 2005 when she finished high school but that child support for the younger child, Nicole, would continue until her 22nd birthday (July [...], 2012). [ 24 ] Although neither Mr. King nor Ms. Toliver was certain about the incomes used to establish the amounts of spousal and child support, both had a clear memory of the specific amounts agreed to. Both said the gross amount payable per month for spousal support was $350. For monthly child support until June 2005, Mr.

Koepke would pay $419. When child support became payable for only the younger child, the amount would be $249 per month. They testified, as well, that child support was to be set off against spousal support. This evidence was not contradicted by Mr. Koepke who agreed in his testimony that "Barry and Karen figured out the time periods for spousal and child support". These figures were also those used by Mr. King when he wrote to Mr. Lance Clark, the accountant who had previously valued Ms.

Toliver's pensions, asking him to present value a lump sum set off. [ 25 ] Whether the set off amount was to be paid periodically or as a lump sum remained an issue at the Settlement Meeting and, according to Mr. King, was vigorously debated. It was Ms. Toliver's position that the set off amount should be present valued and paid as a lump sum. It was also her position that the numbers were final and would not change even if there was a change of circumstances. Both Mr. King and Ms. Toliver testified that ultimately a lump sum amount was agreed to. Mr.

King ’ s evidence was that because the parties could not make this calculation themselves at the Settlement Meeting they agreed to retain Mr. Clark jointly to do the necessary calculations. Mr. King later sent Mr. Clark two letters requesting these calculations, copying Ms. Anderson. [ 26 ] Mr. Koepke said he did not agree to have child and spousal support dealt with as a lump sum amount and wanted it paid periodically. He said he also wanted the ability to vary it if, for example, Nicole did not continue in school until age 22. [ 27 ] Both Mr. King and Ms.

Toliver were cross examined extensively about what income numbers had been used in the calculation of spousal and child support amounts. However, Mr. Koepke gave no evidence that the parties ’ income was in any way contentious at the meeting. I am satisfied that there was no disagreement about incomes at the Settlement Meeting. Income information had been exchanged and, indeed, Mr. Koepke ’ s JDR brief attached ChildView calculations with specific numbers for both parties' incomes. I accept Mr. King's evidence that these were the numbers used and they were not contentious.

[ 28 ] It was Mr. King's evidence, as well, that the only other point of contention at the meeting respecting support was whether the child support and spousal support figures could be varied in the future on a change of circumstances. His evidence was that ultimately Mr. Koepke agreed with Ms. Toliver ’ s position on this issue: the amounts were final and would not fluctuate even in the event of change in circumstance. [ 29 ] Mr. King said, too, that the parties also ultimately agreed that Ms.

Toliver would pay a lump sum amount adjusted to account for the fact that, unlike periodic payments, lump sum spousal support payment is not deductible. [ 30 ] I find the parties did agree on a number of points respecting spousal and child support, based upon suggestions and directions made by Justice Watson at the JDR. Indeed, there is no dispute between the parties about these terms. Further, the two letters written to Mr. Clark and copied to Ms. Anderson, without comment by her, provide ample support for this conclusion: a. Spousal and child support would both be calculated beginning December 1, 2004; b.

Spousal support for Mr. Koepke would continue until June of 2015 because he reached his 55th birthday on June [...], 2015; c. Spousal support would be payable at $350 per month; d. Child support for the older child Bridgette would cease effective June 30, 2005 as she was by then 18 years of age and finished Grade 12; e. Child support for the younger child Nicole would cease after the July 2012 payment because Nicole would reach her 22nd birthday July [...], 2012; f. While child support was payable for both children, the total amount payable would be $419 per month; g.

When child support became payable for only Nicole, the amount payable would be $249 per month; h. Spousal support and child support would be set off against each other. [ 31 ] Despite Mr. Koepke's evidence that he did not agree, I also conclude that the parties agreed that the amount payable would be paid as a lump sum and present valued. The April 12, 2006 letter to Mr. Clark sent by Mr. King and copied to Ms. Anderson, corroborates Mr. King ’ s evidence that this was the parties' agreement.

This letter begins as follows: ...the parties have agreed to settle this matter on the basis of direction received from Mr. Justice J. Watson at judicial dispute resolution. One of the matters that needs to be obtained is a present value calculation for spousal support payable to Murray Koepke which is to be offset against child support payable by Murray Koepke to Rachelle Toliver. [ 32 ] On behalf of Mr. Koepke, it was argued that because page 2 of this letter goes on to say "Ms. Toliver proposes [emphasis added] to pay a lump sum to Mr.

Koepke that would reflect the present value of the monies" this shows the parties did not reach agreement and Ms. Toliver had merely made a proposal to Mr. Koepke to settle on the descrubed basis. I disagree. When considered as a whole, the meaning of the letter is clear. Mr. King told Mr. Clark the parties had settled and instructed him to make calculations as a result. The letter was copied to Ms. Anderson and there was no evidence that she made any response to this letter, either verbal or written.

I infer from her silence that the contents of this letter did not surprise her as it was in accordance with what the parties had agreed to. It is telling, as well, that the letter instructed Mr. Clark that each party would pay one half of his account for doing these calculations and that this account was ultimately paid 50% by Mr. Koepke and 50% by Ms. Toliver. [ 33 ] I find, in addition, that the parties agreed that there would be no later adjustment to the numbers agreed to, notwithstanding that incomes could change or other changes in circumstances occur.

An agreement to pay a lump sum is inconsistent with any agreement that the numbers agreed to could be varied in the future. I accept Mr. King's evidence that paying a lump sum set off amount was important for his client who was determined to make a final settlement and cut off continuing ties to Mr. Koepke who seemed unwilling to let go. Mr. Koepke's own evidence corroborates Mr. King's insistence on this point. He recalls Mr. King and Ms. Toliver rising as if to leave the meeting at one point and Mr. King saying they would "see them in court" if this issue could not be resolved to their satisfaction.

[ 34 ] On behalf of Mr. Koepke it was argued that the letters to Mr. Clark were evidence that the parties had merely made an agreement to agree and that further work was required to settle specific terms. I disagree. While it is true that the parties did not agree to a precise number at the meeting, they agreed upon a means to determine that number and that is sufficient: Klemke Mining Corporation v. Shell Canada Limited , 2008 ABCA 257 at para 20 . [ 35 ] I conclude, however, that the parties did not agree that the lump sum payment would also be adjusted for income tax. Although Mr.

King said this was their agreement, his first letter to Mr. Clark says the opposite. He says this "We have agreed, for the purposes of the present value calculation to not [sic] factor in the tax benefit accruing to Ms. Toliver for the payment of spousal support". Mr. King made an error in this letter, misstating the birth date of Nicole. He testified that his statement that the parties agreed not to adjust for income tax was another error. I find that not to be so. The error in the child's birth date is merely clerical and could easily have occurred.

However, the sentence that deals with non-deductibility of spousal support is positively stated and is unlikely to have been included in error. I conclude that Ms. Toliver wanted to vary this portion of the agreement reached and so asked Mr. King to write again to Mr. Clark asking him to make this calculation. Other than copying the letter to Mr. Clark to Ms. Anderson, there is no evidence that Ms. Anderson ever formally proposed this variation to Mr. Koepke or that he accepted it. [ 36 ] On behalf of Mr. Koepke, it is argued that this offer to amend rescinds the original agreement.

That is not an accurate statement of the law and that is not what occurred here. The parties negotiated at the meeting. Ultimately, Ms. Toliver made an offer to Mr. Koepke which his counsel accepted when she said "we have a deal". The contract was formed at that time. If later Ms. Toliver sought to vary this contract, this offer to vary was not accepted. However, the original contract remained since there is no evidence the parties agreed to vitiate their original agreement. [ 37 ] With respect to matrimonial property, it was Mr. King's evidence that the parties agreed that Mr.

Koepke's WCB lump sum payment was exempt. Mr. King said they agreed as well, that there would be no exemption respecting the net proceeds of his home sold before the marriage because Mr. Koepke had produced no documents showing that these funds still existed or tracing them into an asset that still existed. Although there had already been extensive disclosure and two separate discoveries, Mr. Koepke testified that he remained concerned that Ms. Toliver had appropriated the $14,000 proceeds of the sale of his home and had appropriated, as well, the lump sum WCB payment. Mr.

Koepke said, at various times in his testimony, that the hot tub was purchased with a portion of either his house sale funds or the lump sum WCB payment. Mr. King's evidence was, that although the parties assumed the hot tub might have been purchased from either of these sources, it was by then so old that it had no value. [ 38 ] The contents of Amended Sheet One corroborate Mr. King ’ s testimony. This document shows the WCB impairment award in the column marked 'Husband' under the subheading "Exemptions".

The item 'Equity in the Husband's House' is not present in Amended Sheet One, although it was part of the original sheet one included in the JDR brief. While the hot tub remains listed under the assets category in Amended Sheet One, its value is listed at '0'. [ 39 ] The Matrimonial Home was appraised before the JDR and Mr. King's testimony was that its value was not contentious. This evidence is corroborated by the matrimonial property statements included in both JDR briefs. [ 40 ] On Mr. King's evidence, the real issue respecting the Matrimonial Home was the value of Ms. Toliver's exemption in this property.

Indeed, Mr. King called the value of Mr. Koepke's share in the Matrimonial Home, the central issue of the Settlement Meeting. Evidence of the parties' positions prior to their meeting can be found in their JDR briefs. To determine Mr. Koepke ’ s interest, the parties first had to establish the exempt value of Ms. Toliver ’ s interest in the Matrimonial Home at the time of the marriage. Mr. Koepke's brief valued Ms. Toliver's exemption at $19,516 while Ms. Toliver's brief claims the entire present value as exempt in her hands. Mr.

King's evidence was that Justice Watson suggested some principles at the JDR which the parties ultimately agreed to. They valued Mr. Koepke's share of the Matrimonial Home on the basis that he was entitled to a share of the increase in value since the marriage which occurred as a result of market forces but excepted out of the increase in value, the increase in equity resulting from Ms. Toliver ’ s mortgage payments on the principal of the loan. Mr.

King ’ s evidence was that this number was determined by first doing a rough calculation to determine the approximate amount owing on the mortgage at the time of the marriage. To do this, they worked back from a 1998 mortgage statement, since a mortgage statement from the date of the marriage was not available from the mortgagee. Using this number as a base, they then calculated the approximate amount paid in principal during the marriage until the mortgage was paid in full. Mr. King thought from reviewing his notes that the number resulting from these calculations was that Ms.

Toliver's exempt interest in the Matrimonial Home was $59,352.92. Mr. King said the parties also agreed that the value of the Matrimonial Home at the date of marriage was $130,000. Mr. King's evidence was that the parties agreed Mr. Koepke would be entitled to 30% of the increase in value based on what Justice Watson had said at the JDR. [ 41 ] I accept this evidence. It is confirmed in Amended Sheet One which the parties worked from that afternoon. This statement has added at the end "plus 30% increase house" with a number beside it. It is confirmed, as well in Mr.

King's handwritten notes where the following calculation appears:

232,000 59,352. 92 __________ 172,647.08 x .3 ____________ 51,794.12 [ 42 ] During cross examination, it was suggested that these numbers were not indicative of an agreement but simply recorded an offer or counter offer which Mr. King then took to Ms. Anderson. Mr. King adamantly denied this and said that the parties were working together with Amended Sheet One and with the numbers and that the values they reached were an agreement and not an offer. [ 43 ] Mr. Koepke's evidence with respect to the portion of the value of the Matrimonial Home he thought had been agreed to was a bit confusing but confirmed Mr.

King ’ s evidence to some degree. He said he understood that the lawyers were trying to work backward to calculate how much was owed on the mortgage on the date of the marriage and that once they determined this, they subtracted it from the value of the Matrimonial Home at the date of marriage. He also understood they used the appraisal to obtain the present value of the home. He understood that the present value less the amount the lawyers determined resulted in a number and said he thought he was to get 30% of this. However, he thought that number was $56,000.

What was important from his evidence was that he did not seem to dispute that the parties had reached an agreement about the value of his interest in the Matrimonial Home. [ 44 ] I find that the parties accepted what Justice Watson had to say on this issue and used it as the basis for their agreement. The copy of Amended Sheet One which Mr. King testified he wrote on during the course of the Settlement Meeting has a handwritten number in the Husband's column of $51,794.12. This number also appears in Mr. King's handwritten notes. Further, Mr.

Koepke's evidence is confirmatory although I find his memory is faulty respecting the value of his interest. His description of the calculation he understood was made, would not yield the number that he says he remembers. However, that Mr. Koepke remembers a number different from the one that Mr. King testified to is unimportant. I have concluded that what the parties agreed to a lump sum total and the calculations they did to establish values attached to individual items were simply for the purposes of establishing this lump sum total and were not vital to their agreement. [ 45 ] Mr.

King said that debts were not a real issue as the parties did not have much debt. Each agreed to assume their own debts. [ 46 ] Both Mr. King and Ms. Toliver testified that after much discussion the parties agreed that Ms. Toliver would pay Mr. Koepke a global amount of $110,000 as a property equalization amount. Ms. Toliver's copy of Amended Sheet One corroborates this to some extent. The words "lump sum" are written and underlined in the margin beside the various asset items. The number of $110,000 occurs no where in either of their notes. What does appear on Mr.

King's copy of the matrimonial property statement under the subheading equalization payment to Husband is the number $106,676.12. The number $120,692.70 has been stricken out on this statement. It was Mr. King ’ s evidence that $106,676.12 was the number Mr. King came to after his calculations. $120,692.70 was the number Ms. Anderson calculated. It was Mr. King ’ s evidence, which I accept, that the parties resolved this difference by agreeing to a lump sum equalization payment of $110,000. [ 47 ] Mr. Koepke's evidence was that he had never heard the figure $110,000 in connection with the agreement until Mr.

King's evidence at trial and that the figure of $106,676.12 was also not discussed with him by Ms. Anderson. He did not clearly articulate a number he thought had been agreed to. [ 48 ] Mr. King's evidence was that disclosure again became an issue during the course of the meeting, as it had been throughout. It was his view that Ms. Toliver had disclosed all assets before the JDR. Based upon the evidence of Ms. Toliver, what seems to have been still at issue was a President's Choice joint account or a credit card. It was Mr. King's evidence that he was frustrated when Mr.

Koepke raised what he considered to be a minor or irrelevant issue so late in the game. In trying to convince Mr. Koepke to set aside his concern that there be further disclosure, he said to Mr. Koepke something to the effect that they should "get this done or settled today" so that he could have his money "tomorrow".

[ 49 ] On Mr. King's evidence the parties continued their negotiations after this comment until sometime later, when he and Ms. Toliver left the negotiation room so that Mr. Koepke could speak with Ms. Anderson. About half an hour later they were called back into the room and, according to Mr. King, Ms. Anderson said "we have a deal". He testified that he assumed they shook hands as this was his normal practice but could not recall this. He did recall that he and Ms. Anderson then agreed that he would draft the divorce documents and Ms. Anderson would draft the minutes of settlement and he and Ms.

Toliver then left. [ 50 ] Mr. Koepke does recall shaking Mr. King ’ s hand but said he did not shake either Ms. Anderson ’ s or Ms. Toliver ’ s hands because “ I was not making a deal with them ” . [ 51 ] Mr. King said he had several discussions with Ms. Anderson over the next few weeks, when he called her to find out what progress was being made on the minutes of settlement. However, when he spoke to her, Ms. Anderson told him she was having difficulty with her client and could not get instructions. Ms.

Anderson ceased to act a short time later. [ 52 ] I find on all the evidence that the parties did agree to settle matrimonial property on the basis that an equalization payment of $110,000 would be made by Ms. Toliver to Mr. Koepke. On the evidence of Mr. King, I am satisfied that this amount was a compromise between the $106,676 value established for this payment by Mr. King's calculations and the $120,000 value Ms. Anderson set out in Amended Sheet One. As counsel for Mr. Koepke, Ms.

Anderson had authority to settle on his behalf during the course of court proceedings and I find she did so, by saying "we have a deal". This is so notwithstanding the failure to comply with s. 37 and s. 38 of the Act : see for example Smith v. Haworth , 2003 ABQB 477 . [ 53 ] The settlement amount was global but loosely based upon a total of the values of all of the non-exempt assets except the Matrimonial Home to be left in Ms. Toliver's hands less those left in Mr. Koepke's hands. Added to that number was the approximate value of Mr.

Koepke ’ s interest in the Matrimonial Home, determined by a rough calculation of 30% of the market value portion of the increase in value of the Matrimonial Home since the marriage. From this number, the parties agreed to subtract $2,000, half the value of a GIC in the amount of $4,000 held by Mr. Koepke, which would then be his property. The total amount of the equalization payment would therefore be $108,000. [ 54 ] Mr. Koepke's evidence that he had never heard the number $110,000 before hearing Mr. King's testimony at trial is simply not believable. I note, for instance, that Mr.

Koepke was present in Court during the application made before Justice Slatter. The transcript from that hearing was made an exhibit by consent and in those proceedings, both Mr. King and Justice Slatter mentioned this figure numerous times as the number that had been agreed to and Mr. Koepke did not object, although he said later in the hearing that he thought another number had also been considered. Mr. Koepke ’ s real concern at the hearing before Slatter, J was that the money had not been paid to him the day after the Settlement Meeting. [ 55 ] Mr. Koepke has a vivid memory of Mr.

King telling him that if he made an agreement today, he would have the money tomorrow. He recalled that this was the last thing that Mr. King said before he and Ms. Toliver left the meeting. Mr. Koepke regarded this comment as extremely important and seems to have taken it literally. [ 56 ] I find, however, that Mr. Koepke's memory is faulty when he says this was the last thing Mr. King said at the meeting. As was clear from his cross examination, it has been difficult for Mr. Koepke to keep separate what he remembers happening at the meeting and what he has read or talked about since.

While I have no doubt that Mr. King did make this comment, I prefer instead his evidence that it was simply a figure of speech, made in the course of negotiations and well before the parties reached agreement, in an effort to point out to Mr. Koepke that he should not become fixed on minor issues such as the disclosure and should, instead, concentrate on trying to achieve an agreement so that he could get his settlement money. Mr. King did not mean literally that the money would be available the next day and no reasonable person would have thought that would be so, in the circumstances. Ms.

Toliver did not have that amount of money in cash and it must have been clear to everyone, even if it was not specifically stated, that the only asset from which she could generate that amount of cash was the Matrimonial Home on which she would need to obtain financing to pay the settlement amount. After this comment was made, Mr. Koepke had every opportunity to discuss it with Ms. Anderson. Although she did not testify, and we do not know what her evidence would have been, I am confident that no lawyer would have told Mr.

Koepke, if asked, that the statement was literally true and he could expect the money the next day. I am equally confident that had it been key to his acceptance or a condition precedent to the operation of the agreement, Mr. Koepke would have discussed it with his counsel. I conclude therefore that it was neither a condition precedent to the operation of the agreement nor a fundamental term that the equalization payment be made to Mr. Koepke the day after the Settlement Meeting. Indeed, it would be impossible for this to have occurred. However, the fact that Mr.

Koepke expected funds would be paid to him the next day and wondered why he had not signed anything tells me he

thought they had reached a settlement. I note, as well, his evidence from discovery made a read-in at trial: Q - But you believe that you had an agreement A - Correct. [ 57 ] Mr. Koepke's testimony about the GIC also confirms his understanding that he had made an agreement. He said he understood the GIC was to be split 50/50 with Ms. Toliver. He cashed it when it matured and put the funds into his own bank account. He said he did so only because he thought that Ms. Toliver would take it all if he put it into their joint account. However, he said he knew he had agreed to share the GIC with Ms.

Toliver 50/50. [ 58 ] That the parties reached an agreement is confirmed, as well, by the fact the matter was taken off the trial list. The letter doing so said in part "this will confirm that this matter has been settled". This letter was copied to Ms. Anderson, who was still on the record at that point, and who made no comment. On behalf of Mr. Koepke it was suggested that this fact is neutral as the parties could have decided to take the matter off the list for many different reasons, including that it would cost too much to take it to trial. I disagree.

Had the parties determined that they did not wish to pursue the trial option because of expense, the obvious choice would have been to adjourn the trial, not to remove it from the list. [ 59 ] Mr. Koepke's evidence was that no one told him there would not be a trial and he showed up at the Court House on the date the trial was scheduled to begin. I accept that he did come to the Court House that day but I find it unlikely that he thought the trial would actually proceed. Ms. Anderson was still his solicitor of record, albeit that it is clear there was some difficulty between the two of them by then.

I would be astonished if Ms. Anderson had not told her client that she would not attend the first day of trial to represent him and the trial would be taken off the list. Why Mr. Koepke attended at Court on what would have been the first day of trial is unclear to me but I do not take this as evidence that an agreement was not reached at the Settlement Meeting. [ 60 ] As I have already said, disclosure was a recurring theme during the management of this file. However, it is clear from documents made exhibits that many efforts were made by Ms. Toliver to provide complete disclosure.

I am satisfied from the JDR briefs and from Amended Sheet One as well that extensive disclosure had been provided. Certainly the parties were prepared to go into a JDR and then into settlement negotiations based on the disclosure they had. In addition, the trial had been set down and the start date was imminent. None of these steps would have occurred had it been Ms. Anderson's opinion that disclosure was inadequate. That Mr.

Koepke thought there were further stones left unturned and his wish to obtain further information is not indicative that the parties were not in a position to reach or did not, in fact, reach agreement. [ 61 ] In considering whether the parties' agreement has sufficient certainty of terms, I am entitled to consider the 'commercial' context known to the participants: Klemke Mining Corporation v. Shell Canada Limited , 2008 ABCA 257 at para 18 .

The parties here were faced with a 'fish or cut bait' situation: there had been extensive discovery and disclosure; they were facing an expensive trial; they had now heard the comments of a JDR judge chosen to give them an opinion. Mr. Toliver testified that she wanted to settle and said that when she asked Mr. Koepke at the beginning of the meeting, he agreed that he did as well. A four way meeting between counsel and parties is a well recognized way of achieving settlement in family law matters.

Equalization payments based upon detailed matrimonial property statements are also a quite normal method of settling matrimonial property. The law as it relates to child support and matrimonial property is quite clear. Factors to be considered in determining spousal support are also clear. This was the 'commercial context' in which the Settlement Meeting took place. It was these parties' last chance to settle before trial. [ 62 ] In the result, I conclude that the parties intended to contract and the essential terms of their agreement were clear.

They did, in other words, reach consensus ad idem and made an agreement on spousal support, child support, and on matrimonial property in the following terms: a. Spousal and child support would both be calculated beginning December 1, 2004; b. Spousal support for Mr. Koepke would continue until June of 2015 because he reached his 55th birthday on June [...], 2015; c. Spousal support would be payable at $350 per month; d. Child support for the older child Bridgette would cease effective June 30, 2005 as she was 18 years of age and finished Grade 12; e.

Child support for the younger child Nicole would cease after the July 2012 payment because Nicole will reach her 22nd birthday July [...], 2012;

f. While child support was payable for both children, the total amount payable was $419 per month; g. When child support became payable for only Nicole, the amount payable would be $249 per month; h. Spousal support and child support would be set off against one another and paid as a lump sum. i. Matrimonial property would be settled on the basis that Ms. Toliver would pay Mr. Koepke as a lump sum $110,000 less $2,000 for her portion of the GIC for a total lump sum payment of $108,000. [ 63 ] Mr.

Koepke may have suffered from what is sometimes called "buyer's remorse" sometime after the agreement was reached but that does not alter the fact that through his counsel, he entered into a settlement agreement with Ms. Toliver. [ 64 ] The agreement in respect to matrimonial property is not in writing and the provisions of the Act set out in s. 37 and 38 have not been met.

It is, however, an agreement which may be considered pursuant to s. 8 of the Act . [ 65 ] Their agreement respecting child and spousal support does not have the same compliance problems and is enforceable. [ 66 ] Costs may be spoken to if required. Heard from April 30 th to May 3 rd , 2012. Dated at the City of Edmonton, Alberta this 9 th day of May, 2012. D.C. Read J.C.Q.B.A. Appearances: Michele J. Reeves Attia Reeves Tensfeldt Snow for the Plaintiff Thomas E. Plupek & June K. Koska for the Defendant