Nichols v Delay, 2012 ABQB 429

Court of Queen ’ s Bench of Alberta Citation: Nichols v Delay, 2012 ABQB 429 Date: 20120709 Docket: FL01 00532 Registry: Calgary Between: Andre Jean-Baptiste Delay Applicant - and - Gail Elizabeth Nichols Respondent _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice C. Jones _______________________________________________________ [ 1 ] This matter came before me on June 6, 2012. Mr. Delay lives in Ontario. His former partner, Ms. Nichols and their 11 year old child, Duncan, live in Alberta. [ 2 ] Mr. Delay commenced an action in Ontario pursuant to the Interjurisdictional Support Orders Act , 2002 Statutes of Ontario 2002,

Chapter 13 . He seeks: 1. variation in ongoing child support from $800 per month to $472 per month. His application states that he seeks a “retroactive

adjustment in the amount of support from 2006 to present”.

Section 4 of his Affidavit of March 28, 2011 says “I am also requesting the Court for a retroactive adjustment of child support from January 1, 2007 to present. . .; 2. extinguishment of his outstanding child support arrears.

As of May 30, 2012 those arrears totalled $5,077.98; 3. if his child support arrears are not extinguished, variation in arrears he must pay from $325 per month to $100 per month; 4. pro-rata payment of travel expenses associated with Duncan's visits to Ontario; and 5. costs on a substantial recovery basis. [ 3 ] He also seeks abridgment of time (though he does not specify in respect of what time period he seeks abridgment) and he seeks leave to amend his pleadings if required. [ 4 ] Division 2 of

Part 3 of the Interjurisdictional Support Orders Act , SA 2002, c. I-3.5 ("ISOA") provides a mechanism by which Mr. Delay’s action commenced in Ontario may be adjudicated in Alberta.

Section 32 of the ISOA allows this Court to: (

a) make a support variation order, (

b) make an interim support variation order and adjourn the hearing to a specified date, (

c) adjourn the hearing to a specified date without making an interim support variation order, or (

d) refuse to make a support variation order. [ 5 ] It also allows this Court to make a support variation order that is retroactive and it permits this Court to direct that support be paid in periodic payments or as a lump sum, or both. [ 6 ]

Section 30 of the ISOA provides that, in considering Mr. Delay's application, this Court must consider: (

a) the evidence given or submitted to the Alberta court, and (

b) the documents sent from the reciprocating jurisdiction. [ 7 ] Mr. Delay's application is a "support variation application", as that term is contemplated by

section 28 (

b) of the ISOA . That provision states that a "support variation application" means, inter alia , documents from a reciprocating jurisdiction corresponding to a support variation application described in section 24(2). Documents and information described in section 24(2) encompass: (

a) the applicant's name and address for service; (

b) a certified copy of the support order that the applicant is applying to vary;

(

c) a copy of the specific statutory or other legal authority on which the applicant's support variation application is based, unless the applicant is relying on the law of the jurisdiction where the respondent ordinarily resides; (

d) the particulars of the variation applied for, which may include a termination of the support order; (

e) the sworn document described in subsection (3); and (

f) any other information or documents required by the regulations. [ 8 ] Mr. Delay has been making child support payments, albeit not at the level he was required by Court Order to make. [ 9 ] Mr. Delay's Affidavit of March 28, 2011, attached to his materials, offers the following justifications for the relief he seeks. 1. Variation in ongoing support from $800 per month to $472 per month, retroactive to 2007. [ 10 ] I have based my judgment on the request to adjust child support retroactive to January 1, 2007, as requested in Mr. Delay’s Affidavit of March 28, 2011.

He claims that child support, based on income of $80,000 imputed to him by this Court on February 10, 2006 ("February, 2006 Order") is not reflective of his actual income since moving to Ontario in 2006. He consented to that Order and was represented at the time. He asserts that the Order imputing income of $80,000 was based on his average income over the previous three years which included a non-recurring withdrawal from his RRSP. He claims never to have made $80,000 since the granting of that Order.

He claims his actual income has been: (a) 2006 - $77, 706 (b) 2007 - $55,459 (c) 2008 - $54,500 (d) 2010 - $16,832 (e) 2011 - $ 4,236 [ 11 ] His T1 Tax Returns and/or Notices of Assessment for those years support those income assertions.

His 2009 T1 shows line 150 income of $58,050. [ 12 ] His Affidavit of May 22, 2012 indicates that he obtained employment in 2012 and that, as of May 10, 2012, his year to date income is $14,909. [ 13 ] He moved to Ontario in July of 2006 and claims he was required to accept substantially lower income of approximately $50,000 in his field as an electrician, presumably because the job market in Ontario was not as remunerative as that which existed in Alberta at the time. [ 14 ] He claims to have moved to Ontario because his widowed mother required his assistance.

He claims to have made regular payments based on his actual income but not as would have been required at the imputed income level. [ 15 ] He also asserts that he has made direct deposits of $4,730.25 to Duncan's bank account for amounts related to hockey, school

outings and clothing. [ 16 ] He states in his Affidavit of March 28, 2011 that his ongoing child support should be based on his actual gross annual income which he estimates to be $55,000. He asserts that he commenced self-employment in 2010 because his then employer would not likely be able to provide him with sufficient hours. His venture was not successful and in 2012 he began to work for Richard Gladu Electrical. [ 17 ] He cohabits with his new partner and her two children.

His new partner and one of her children contribute financially to the household's expenses and he has provided some information regarding incomes which those two individuals earn. [ 18 ] His materials included a household budget. That budget asserts that his share of household expenses, together with other expenses which he alone bears, total $5,844.88 per month. [ 19 ] He claims to have attempted to vary the February 10, 2006 Order through the interjurisdictional process but ran into difficulties and gave up. [ 20 ] Ms. Nichols responds to Mr. Delay's assertions in her Affidavit of June 1, 2012.

She asserts that: a. She agreed to ongoing child support in the amount of $800 per month and the arrears Mr. Delay was ordered to pay by virtue of the February 10, 2006 Order, notwithstanding that she believed that she was entitled to receive more based on Mr. Delay's prior income levels. She claim that she made those concessions because of: i. Mr. Delay’s payments totalling $7,450 for 2004 and 2005; ii. Mr. Delay's agreement to pay retroactive child support in the amount of $7,800 at the rate of $325 per month; iii. Mr.

Delay's access costs of $300 per month in respect of travel between Leduc and Langdon Alberta; and iv. threats she claims were made by Mr. Delay to not pay any support. b. She accepted $116 per month less for 2006 child support than she believes she was entitled to receive, based on Mr. Delay's income. c. In total, she believes that she "gave up" child support which she was otherwise entitled to receive in the amount of $7,298 for 2004-2006. d. Duncan would suffer hardship if support payments of less than $800 per month were ordered. e. Mr.

Delay is living in his mother's former home, with three individuals two of whom are earning an income. f. She disputes the extent of deposits which Mr. Delay claims to have made to Duncan's bank account and the use to which those monies were put. g. Her ability to contribute to Duncan's support has been compromised because she has been receiving only disability payments and not working since October 2010.

h. Duncan's hockey related expenses represent a significant

section 7 expense which she believes are important to Duncan’s growth and development. 2. Extinguishment of Mr. Delay ’s outstanding child support arrears. [ 21 ] Mr. Delay asserts that his child support obligations should be adjusted retroactively to January 1, 2007, in light of his actual income during that period, with the effect that his arrears would largely disappear. [ 22 ] He asserts that, for the period 2006 to 2010, his child support arrears would have only been $1,497, if he had been required to pay support based on his actual income and not imputed income of $80,000.

He asserts that he would have actually overpaid had his support obligations for those years been calculated as if he were a payor resident in Alberta, as opposed to Ontario. [ 23 ] Ms. Nichols, in her Affidavit of June 1, 2012, asserts at para. 15. that: a. Duncan would suffer hardship if arrears are reduced or extinguished. b. She agreed to contribute to travel expenses on the understanding that Mr. Delay would pay support at the agreed upon level and she continued to do so until Easter of 2009, notwithstanding that Mr. Delay was in default, until she could no longer afford to do so. [ 24 ] Ms.

Nichols makes the point that she has conducted herself in accordance with expectations of support which the February, 2006 Order directed. She argues that it would be unfair to retroactively reduce Mr. Delay's child support obligations in light of what she considers to be her reasonable expectations. 3. If Mr. Delay ’s child support arrears are not extinguished, variation in arrears he must pay from $325 per month to $100 per month. [ 25 ] Presumably, Mr.

Delay believes that there is a greater prospect of him being able to discharge these arrears in a timely fashion if he is able to pay at the lower amount. [ 26 ] Ms. Nichols states at para. 19 of her Affidavit of June 1, 2012 that Mr. Delay is voluntarily unemployed or underemployed in order to reduce his child support obligations. Ms. Nichols would have me impute income to Mr. Delay pursuant to section 19(1)(

a) of the Alberta Child Support Guidelines. She asserts that Mr. Delay is capable of earning at least $55,000 in Ontario. In argument, her counsel asserted that Mr. Delay is capable of paying support based on an income of $66,092 for 2012. She appears to arrive at that number with reference to Exhibit "A" of Mr. Delay's Affidavit of May 22, 2012. There, Mr. Delay reports income of $2,542.18. I assume that pay stub represents a two week pay period though I have not verified that assumption. Multiplying $2,542 by 26 yields $66,092. [ 27 ] Ms. Nichols asserts that Mr. Delay chose to quit his job and move to Ontario.

She referred to a number of authorities for the proposition that I should impute income to Mr. Delay, based on intentional underemployment. They include: a. V.L.W. v. J.E.W , 2007 ABQB 358 ; b. Mercer v. Mercer , 2004 ABQB 551 ;

c. Drygala v. Pauli, ; 61 O.R. (3d) 711; d. Barker v. Barker, 2005 BCCA 177; e. Cole v. Cole, ; 144 A.C.W.S. (3d) 298; f. Rodrigues v. de Sousa, 2008 ONCJ 807 , 69 R.F.L. (6th) 449; g. Eirabie v. Eirabie, 2010 ONSC 6507; and h. Ruszczak v. Scherbluk, 2012 ONCJ 14. [28] V.L.W. v. J.E.W and Mercer v. Mercer would appear to be particularly relevant as they are Alberta decisions. However,

section 31 of the ISOA provides that:

(1) In determining the entitlement to receive or to continue to receive support for a child, the Alberta court must first apply the lawof the jurisdiction in which the child ordinarily resides, but if the child is not entitled to support under that law, the Alberta court mustapply the law of Alberta.

(2) In determining the amount of support for a child, the Alberta court must apply the law of the jurisdiction where the person liableto pay the support ordinarily resides. [29] It is arguable that: 1. imputation of income to Mr. Delay is a matter involving determination of "amount" (as opposed to Duncan's "entitlement"); and 2. section 31(2) is a direction to apply the laws of Ontario (as opposed to Alberta) to the question of whether or not to impute an"amount" of income to him. [30] I do not, however, believe

section 31 was intended to guide choice of law in cases involving imputation of income undersection 19(1)(

a) of the Alberta Child Support Guidelines or its Ontario equivalent, which is substantively identical. Rather, I believe thatsection 31 was intended to address choice of law in situations where it is necessary to determine (

i) if a child fulfills the requirementsnecessary to entitle that child to support (section 31(1)) and, (ii) what the payor's obligation will be based on the applicable table (section31(2)). [31] Choice of applicable law makes a difference. Alberta cases have arguably articulated a stricter test in imputing income thanappears to be the case in Ontario. In that regard, see the decisions of our Court of Appeal in Hunt v. Smolis-Hunt ABCA 299 and Taylorv. Taylor 2009 ABCA 354. Neither case was offered as authority in Ms. Nichol's brief. In my view, the two Alberta cases, V.L.W. v.J.E.W and Mercer v.

Mercer, advocate an approach which permits the intention to avoid child support obligations to be inferred from acombination of: 1. the decision to pursue a particular occupational path; and

2. knowledge that a particular choice will adversely affect the ability to discharge a child support obligation. [ 32 ] Their joint presence allows the Court to invoke the bad faith test in Smolis-Hunt and allow intention to avoid child support obligations to be inferred. [ 33 ] Both of these Alberta cases predate the Court of Appeal's decision in Taylor v. Taylor and neither of them are cited in that decision. The following extracts from the Court of Appeal's decision in that case examine the determination of intention to avoid child support obligations: …s. 19(1)(

a) requires proof of a specific intention to undermine or avoid support payments or proof of circumstances which permit the court to infer that the payor's intention is to undermine or avoid his or her support obligations. This principle arises from the plain reading of s. 19(1)(a), which states that the spouse who is called on to pay support must be intentionally under-employed or unemployed: Smolis-Hunt at para. 42. [para. 12] The third relevant principle from Smolis-Hunt is that persons who are involved in divorce proceedings are entitled to change employment.

Individuals, including those obliged to pay support, are free to pursue work that provides not only income but also a sense of self-worth and emotional well-being. [para. 14] Intent to evade support obligations may be found where the unemployment, underemployment or other acts of the person obliged to pay support indicate a deliberate refusal to live up to the obligation to support one's children: Smolis-Hunt at para. 73. [para. 15] The paying parent's history of support payments is a relevant factor in inferring the requisite intention: Smolis-Hunt at paras. 74-75.

In the context of a parent who has generally paid support on time and in appropriate amounts, as opposed to a parent who has never paid or has paid only sporadically, a change of employment is less likely to be considered a deliberate attempt to evade child support. In any event, courts should be careful not to infer intentional evasion of support obligations from legitimate disputes about amount or timing. [para. 16] [ 34 ] These quotes suggest to me that choice and knowledge of consequence of choice are not sufficient to find the intention required by section 19(1)(

a) to impute income. Choice, together with knowledge of consequence will, however, be sufficient where the circumstances allow the court to conclude that a desire to compromise one's ability to pay support underlies the decision to pursue a particular course of action. [ 35 ] Restated in its simplest terms, I conclude from the decision is Taylor v. Taylor that cause and effect are not sufficient to allow the court to impute income. The "effect" must be impairment of a payor's ability to pay support but that impairment must also have been the intended result.

Intent cannot, as stated in Mercer , simply be inferred from the natural consequences of the payor's actions. [ 36 ] Ontario law would appear to be different. Justice Kenny notes in V.L.W. v. J.E.W that the Ontario Court of Appeal in Drygala . v. Pauli (2002), R.F.L. (5th) 293 interpreted the word "intentionally" in section 19(1)(

a) not to relate to the effect (compromised ability to pay child support), but rather to the act (choosing not to work when capable of earning an income) which gave rise to the effect. If the choice is voluntary and child support is compromised, the requisite intention exists. [ 37 ] In Ontario it would appear that bad faith, in the sense that a payor deliberately sets out to avoid fulfilling what would otherwise be his child support obligation, need not be found to exist in identifying the intention required to impute income. [see para 22 of Justice Kenny's decision].

As Kenny, J. notes at the end of para 23 of her decision, under Ontario law "an intention to avoid child support is not required". [ 38 ] As noted at para 28 of the decision in Drygala :

The parent required to pay is intentionally under-employed if that parent chooses to earn less than he or she is capable of earning. [ 39 ] Having reviewed the facts, I am not satisfied that Mr. Delay "chose to earn less than he is capable of earning" as that phrase is understood in Drygala . Implicit in each of the other Ontario decisions cited by Ms. Nichols is a finding that the payor acted unreasonably in the circumstances. [ 40 ] Rather, I accept Mr. Delay’s assertion that he moved to Ontario to assist his widowed mother.

I have no reason to disbelieve his evidence that he started his own business because he believed that his prospects with his then current employer were limited. When it became evident to him that self-employment was not viable, he secured new employment. He has consistently made child support payments at levels which he believed his actual income would support. I have seen no evidence of bad faith. [ 41 ] In

summary, whether I apply Ontario or Alberta law to the question of whether or not Mr. Delay is intentionally underemployed, I come to the same conclusion. I am not satisfied that Mr. Delay purposefully sought to undermine his child support obligations and I am not entirely satisfied that he chose to earn less than he was capable of earning. He was, in large measure, affected by the circumstances he found himself in. Accordingly, I am satisfied that those circumstances cannot be attributed entirely to his free choice. [ 42 ] On balance, I am satisfied that Mr. Delay chose to move to Ontario to assist his mother.

He did not choose a lower paying job over a higher paying job. It may be argued that obtaining employment at lower income than he might have enjoyed in Alberta was not the choice he made. It was a consequence of the choice he made which was to move to Ontario to assist his mother. [ 43 ] However, I do not completely embrace this articulation of events. Mr. Delay had other choices available to him. He might have waited until he was let go from O/A D.G. Electric. He might have sought employment with another company providing electrical services.

He might have considered moving to a new location where the prospects of finding work were better. He may, in fact, have investigated some or all of these options and none of them may have been feasible. However, his affidavit evidence does not address those possibilities. Instead, he chose to start his own business and his income dropped. [ 44 ] In the result, I direct that Mr. Delay's

section 3 table support obligations be recomputed for the years 2007 to and including 2011, using the Ontario tables for the applicable years, based on the following income levels: (a) 2007 - $55,459; (b) 2008 - $54,500; (c) 2009 - $58,050; (d) 2010 - $45,000 imputed; (e) 2011 - $40,000 imputed; To the extent that this recalculation determines that he has paid more in respect of his child support obligations than this recalculation would have otherwise required him to pay, any such “overpayment” shall be deemed to have been paid by him on account of additional periodic child support.

Should any arrears continue to be owing after this recalculation, they shall be discharged by him at the rate of $200.00 per month commencing August 1, 2012. [ 45 ] Notwithstanding my adjustment to

section 3 table support arising by virtue of the re-computation directed above, I further direct that Mr. Delay’s obligation to pay

section 7 expenses remains at the level of $139.00 per month up to and including the month of October, 2010, whereupon that obligation terminates. [ 46 ] For 2012, his child support obligations will be based on income, which I impute to him, of $55,000. That amount is consistent with his assertions in his Affidavit of March 28, 2011 and I believe he is capable of earning that level of income. Mr. Delay and Ms.

Nichols will pursue annual adjustments to Mr. Delay’s obligation to pay

section 3 child support, based on his actual earnings. Ms. Nichols is at liberty to make an application to vary support if she believes that his actions going forward are such as to warrant imputation of income or if his actual earnings turn out to be greater than $55,000. 4. Pro-rata payment of travel expenses associated with Duncan's visits to Ontario. [ 47 ] Mr. Delay asserts that Ms. Nichols unreasonably objects to his oldest daughter accompanying Duncan on visits to Ontario. [ 48 ] Ms. Nichols does not believe Mr. Delay’s oldest daughter is an appropriate person with whom to entrust Duncan's care.

She points out that Mr. Delay chose to move to Ontario in 2006 and she asserts that he should consequently be responsible for all travel costs. I am mindful of the fact that the Order of Judge O’Gorman of December 8, 2006 contemplated Mr. Delay’s move to Ontario when it assigned some of the travel expenses to Ms. Nichols. I am, however, of the view that Ms. Nichol’s limited income earning capacity in light of her physical injuries places a burden on her in meeting what would have otherwise been her share of expenses. [ 49 ] I accept Ms. Nichols’ arguments in this regard. Until further Court order, Mr.

Delay shall be responsible for Duncan's travel expenses.

Section 7 Hockey Expenses [ 50 ] Ms. Nichols sought affirmation that Duncan's

section 7 hockey expenses be borne by the parties in proportion to their incomes. It is not evident to me that Mr. Delay was aware that Ms. Nichols would be making such an application. No representations were made by him in that regard. Accordingly, I am not prepared to consider her request at this time. She is at liberty to make application, on proper notice to Mr. Delay, to determine if past and ongoing hockey expenses constitute appropriate

section 7 expenses for which Mr. Delay should be proportionately responsible. He may then offer his views with respect to the nature and quantum of this expense. 6. Costs on a substantial recovery basis. [ 51 ] Both parties have enjoyed partial success. Each party shall bear their own costs. 7. Other matters. [ 52 ] Ms. Young of Family Justice Services, provided the Court with a very helpful

summary of the parties' positions on various matters. She observed that the Court might be inclined to consider invoking the hardship provisions of

section 10 of the Alberta Child Support Guidelines in order to provide Mr. Delay with some relief. I note that application of those provisions requires either or both of the parties to specifically seek such relief. Neither party sought the application of this provision and, accordingly, I consider it unnecessary under the circumstances to consider it further. Heard on the 6th day of June, 2012. Dated at the City of Calgary, Alberta this 9th day of July, 2012.

C. Jones J.C.Q.B.A. Appearances: Andre Jean-Baptiste Delay for the Applicant - Self Represented Hildebrand Wilde for the Respondent Wendy Young, Family Justice Services