Witwicki v Seifner, 2013 ABQB 354

Court of Queen ’ s Bench of Alberta Citation: Witwicki v Seifner, 2013 ABQB 354 Date: 20130620 Docket: 4803 116213 Registry: Edmonton Between: Jacqueline Michelle Witwicki Applicant/Defendant - and - Gerhard Julius Seifner Respondent/Plaintiff _______________________________________________________ Memorandum of Decision of the Honourable Mr. Justice M. David Gates _______________________________________________________ I.

Introduction [ 1 ] The Applicant, Jacqueline Witwicki, seeks retroactive child support in the amount of $38,952 on the grounds that the Respondent, Gerhard Siefner, failed to comply with the terms of a consent order between the parties, granted by Bielby J. (as she then was) on November 10, 2008. Specifically, the Applicant says that the Respondent failed to provide his detailed financial information on an annual basis as required by the Bielby order.

The Respondent resists this application on the basis that retroactive child support would amount to a “ windfall ” for the Applicant in light of the fact that the one child of the marriage, Ciara Adriana Seifner ( “ Ciara ” ), currently 16 years of age, has been residing with the Respondent on a full-time basis since February 2011. It is common ground between the parties that the Respondent ’ s child support table amounts would have been $38,952 more than the amount he actually paid if he had

disclosed his actual income from 2008 to 2011. II. Facts [ 2 ] The parties have one child of the marriage, Ciara, born on August 15, 1996. [ 3 ] After the parties divorced, Ciara lived with the Applicant for a number of years. In February 2011, she moved in with the Respondent. There was a period of time between April 2012 and June 2012 when she moved back to live with the Applicant. However, Ciara returned to live with the Respondent in June 2012. [ 4 ] The most recent order dealing with child support between the parties is a consent order granted by Bielby J on November 10, 2008. The

preamble to the order set the Applicant ’ s Guideline Income for 2007 at $23,023 and the Respondent ’ s at $202,931. [ 5 ] The 2008 order required the Respondent to pay $1,760 per month to the Applicant as s. 3 child support, starting on November 1, 2008.

The Respondent was also required to pay $11,204.70 to the Applicant as a “ retroactive adjustment ” for 2006 and 2007. [ 6 ] The order also contained the standard requirement that each party was to make on-going financial disclosure by exchanging complete copies of their income tax returns every year on or before June 30, as long as Ciara continued to be a child of the marriage. [ 7 ] The order also dealt with the parties ’ respective responsibilities relative to s. 7 expenses.

In particular, the order deemed any expense relating to an organized extracurricular activity in amount of more than $600 as a s. 7 expense. Likewise, the Respondent was required to pay his proportionate share (89.81%) of any uninsured orthodontics expenses related to Ciara. Finally, the order directed that the Applicant was to reimburse the Respondent for 10.19% of any s. 7 expense incurred by the Respondent. III. Issue [ 8 ] The issue on this application is narrow.

The Respondent concedes that if the Applicant is entitled to a retroactive child support award, then both the Applicant ’ s assertion of quantum and the date of retroactivity is not disputed. The only issue is, accordingly, whether the Applicant is entitled to an award of retroactive child support. IV. Position of the Parties (

A) Applicant [ 9 ] The Applicant says that the Respondent has not historically provided his annual income information and only provided it after the Applicant ’ s counsel brought a formal financial disclosure application. In response to the Notice to Disclose, the Respondent provided his 2008, 2009, 2010, and 2011 tax returns. Based on the Notices of Assessment attached to the Applicant ’ s affidavit, the respondent ’ s income from 2008-2011 was: 2008: $ 254,553 2009: $ 275,000

2010: $ 374,999 2011: $ 441,149 As previously noted, the 2008 order determined child support on the basis of a guideline income of $202,931. By 2011, the Respondent ’ s guideline income had more than doubled. [ 10 ] The Applicant contends that she is entitled to the retroactive award for the following reasons:

(1) The Applicant provided primary care of Ciara from January 2008 until Ciara moved in with the Respondent in February 2011. The retroactive award therefore constitutes the amount that was due and owing to the Applicant as child support during the years in question.

(2) The Applicant ’ s evidence in her affidavit was that Ciara was cared for using child support, together with supplementary resources from both the Applicant ’ s income as well as that of her new husband in order to meet Ciara ’ s needs and wants. As a result of spending more than the support received, the Applicant gave up various discretionary expenses for herself to ensure Ciara could have a lifestyle similar to what she had when the parties were married. The Applicant submits that child support is meant to be commensurate with the standard of living of the parents.

Further, the Applicant asserts that she is under no legal obligation to account to the Respondent for money she has spent on Ciara, or otherwise to provide an accounting to the Respondent for any or all child support payments.

(3) The Applicant says that she still provides money to Ciara and incurs expenses for her during the time they continue to spend together.

(4) The Applicant rejects the Respondent ’ s characterization of his unfulfilled child support obligations as a windfall. Ciara was in the Applicant ’ s primary care in the years that the amount was payable. It follows that the Applicant is entitled to receive this amount, regardless of Ciara ’ s current principle residence, given the Applicant ’ s on-going obligation to support her child. Furthermore, the Applicant says that she should not be required to account for how the retroactive award would be spent.

She maintains that Ciara will benefit from this award because she continues to be a child of the marriage and, as such, will continue to spend time with, and require the support of, both parents. [ 11 ] Finally, the Applicant suggests that the Respondent is in a unique position as a partner at a large Edmonton law firm where at least a portion of his practice is in the field of family law. His employment therefore affords him a unique understanding of his legal obligations towards his child. (

B) Respondent [ 12 ] The Respondent objects to a retroactive award on the basis that Ciara currently lives with him, not the Applicant, and that any retroactive award would constitute a windfall to the Applicant. Alternatively if some amount is payable, he argues it should be placed in trust for the child. In this regard, he invites the Court to use its authority under

section 15.1(4) of the Divorce Act , RSC, 1985, c 3 (2 nd Supp) to impose conditions on the making of any retroactive order. [ 13 ] The Respondent urges the Court to dismiss this application and order no retroactive child support for the following reasons:

(1) Ciara lives with the Respondent and is likely to continue living with the Respondent for the foreseeable future. The Respondent ’ s main concern is that this application is for a significant lump sum award from the home of the Respondent, where the child is currently living and being supported, to the home where the child used to live.

(2) The Respondent acknowledged in his affidavit that his income has increased since 2008. However, the Respondent stated that his daughter has not been going without anything she needed. He was also covering additional expenses for her from time to time.

(3) Finally, the Respondent argues that the Applicant should be required to demonstrate how a retroactive award would benefit the child.The Respondent also argued that there is no evidence the Applicant spent money over and above the child support amount he paid eachmonth to benefit Ciara. V. Legislation [14] Section 17(1) of the Divorce Act provides: 17

(1) A court of competent jurisdiction may make an order varying, rescinding or suspending, prospectively or retroactively, (

a) a support order or any provision thereof on application by either or both former spouses; VI. Analysis [15] Child support is the right of the child and it should provide the child with the "same standard of living they enjoyed whentheir parents were together" (DBS v SRG, 2006 SCC 37 at para 38). [16] Parents have an obligation to support their children commensurate with their income. Where a payor parent has not increasedthe child support payments to correspond with their income, they have not fulfilled their obligation to their children (DBS at paras 48,54).

Even where the payor has made payments that are consistent with a court order, if those payments did not increase when they shouldhave, the payor parent has not fulfilled the obligation to his or her children (DBS at para 68). [17] Retroactive awards enforce an obligation that existed at the relevant time in question and that should already have beenfulfilled (DBS at para 68). Both parents have financial obligations to their child, which exist from the time a child is born (MacMinn vMacMinn, (1995) (AB CA), 174 AR 261 at para 15 (ABCA)).

The use of the term “retroactive” may therefore bemisleading because the obligation to provide support to a child has always been present. [18] A court may order a retroactive child support award where there has been a court order for child support, but the amount hasbeen inadequate (DBS at para 62). Here, there was a prior court order made by Bielby J.

There is no dispute that there has been anincrease in the Respondent's income without a corresponding increase in the amount of child support paid. [19] Bastarache J. writing for the majority in DBS set out a number of factors a court should consider when exercising itsdiscretion to award retroactive child support:

(1) The reasonableness of the explanation as to why the additional child support was not sought earlier;

(2) Conduct of the payor parent;

(3) Circumstances of the child; and

(4) Any hardship to be occasioned by a retroactive award. (

A) The DBS Factors

(1) Reasonable excuse why support was not sought earlier

[ 20 ] Unreasonable delay by the recipient parent in applying for support is merely a factor to consider in this analysis. It does not eliminate the payor parent's obligation to pay child support: DBS (at para 104 ).When considering the reasonableness of the recipient parent's behaviour, Bastarache J. stated that the court may look to the conduct of the payor parent (at para 102). [ 21 ] In Bidwell v Bidwell , 2011 ABQB 261 Burrows J. considered an application for retroactive child support.

The recipient parent served the payor parent with notices to disclose financial information on three separate occasions in 2007, 2008 and 2010. The payor provided disclosure each time such a request was made. However, the recipient did not bring an application to vary child support until early January 2010, which application was not actually heard until March 29, 2011.

Notwithstanding that the payor provided the requested financial disclosure, and the recipient did not bring the application to until much later, Burrows J. found that the failure to seek variation by the respondent did not relieve the payor of the obligation to increase his child support payments as his income increased (at para 10). As a result, the payor was required to pay retroactive child support. [ 22 ] Here, the Applicant has demonstrated that she took steps to obtain the Respondent ’ s finanical information.

In the Applicant ’ s affidavits she has stated that she was required to retain a lawyer for several years in order to deal with the issues which arose from attempting to obtain the Respondent ’ s disclosure. She stated that the Respondent has not provided his income information to her, unless compelled to do so.

While the Respondent argues in his affidavit that he had asked the Applicant if she wanted his tax information and she said that it was not necessary, the Applicant asserts she has never declined to accept the Respondent ’ s income information. [ 23 ] Under the circumstances, and having particular regard to tone and content of the Respondent ’ s email messages to the Applicant that are before me, I am of the view that there is a high degree of moral blameworthiness in the behaviour of the Respondent.

As a member of the Law Society of Alberta engaged in the practice of law, at least a portion of which was in the field of family law, he had to have been fully aware of his obligations under the terms of the 2008 consent order to provide annual financial disclosure to the Applicant.

(2) Conduct of the payor parent [ 24 ] In DBS , Bastarache J. characterized blameworthy conduct as "anything that privileges the payor parent's own interests over his/her children's right to an appropriate amount of support" (para 106). If a payor parent knowingly avoids his support obligation to his child, he should not be allowed to profit from such conduct.

A conscious choice to ignore his obligation may still constitute blameworthy conduct even where the payor parent has not done anything to actively to avoid the obligation (at para 107). [ 25 ] Where a payor parent has a reasonably held belief that he is meeting his support obligations, his actions may not constitute blameworthy conduct.

Bastarache J stated that a court may consider a previous court order in determining whether the payor parent had a reasonably held belief that he was meeting his support obligations (at para 108). [ 26 ] In LL v GB , 2008 ABQB 536 , Graesser J. awarded retroactive support for two children who were 21 and 25 at the time of the order and had both completed a few years of post-secondary education.

Graesser J. found the payor had a significant increase in his income for at least 7 years but did not disclose his gross income to the recipient, despite being required to do so by various demands, orders and the separation agreement between the parties (at para 78). Graesser J. held that the payor can not have misunderstood the recipients intention to increase maintenance and that “ [h]e cannot use his stonewalling and his disregard of his disclosure obligations under the separation agreement and the Order as an excuse for not paying retroactive maintenance ” (at para 111).

As a result, Graesser J. found that the payor ’ s conduct was blameworthy for the following reasons: he put his own interests ahead of his children ’ s right to an appropriate level of support; he had no reason to believe he was adequately supporting his children; and he ignored the obligation under the Order to provide timely financial disclosure (at para 127). [ 27 ] Counsel for the Respondent argues that between his monthly child support payments and what he incurred by way of additional expense for the support of Ciara, it was reasonable for him to assume his child's needs were being fully met.

In my view, this argument amounts to an attempt to justify a failure on the part of the Respondent to fulfill his support obligations to his child on the basis that the child ’ s needs were fully met by the reduced amount actually paid. In effect, the Respondent is saying that he believes that he paid enough, notwithstanding the support level dictated by the Federal Child Support Guidelines , SOR/97-175. In my view, he must have known that he was not fulfilling his legal obligations to his child. At the very least, the Respondent ought to have known his child was entitled to more support.

The 2008 consent order contained an award for retroactive child support. Further, the order was a consent order and, as such, clearly reflected the Respondent ’ s agreement to pay retroactive child support at that time. I conclude from all of the circumstances that the Respondent was aware of this form of award and the underlying basis for making such a retroactive award.

[ 28 ] With respect to disclosure of financial information, the Respondent states in his affidavit that he asked the Applicant in the past whether she would like his tax information and she said it was not necessary. I do not accept this as reasonable under the circumstances. As a lawyer, the respondent was well aware of the legal obligations that attach to a court order. His evident disregard for his on-going financial disclosure obligations amounts to blameworthy conduct on his part.

Moreover, as a lawyer whose regular practice included family law, he must be taken to be aware that child support is the right of the child, not the parent with primary care. [ 29 ] Furthermore, the 2008 consent order required that each party “ shall ” exchange income information on a yearly basis. The order did not require that each party shall “ ask ” the other party if they wish to see the income information. As stated above, I do not accept the respondent ’ s explanation in this regard.

He was under a legal obligation to provide financial disclosure, not a legal obligation to inquire as to whether or not the Applicant wished to receive such disclosure. There is simply no excuse for his failure to comply with the terms of the order. [ 30 ] In the result, I find the Respondent ’ s level of blameworthiness in this instance to be very high.

(3) Circumstances of the child [ 31 ] A court should also consider the present and past circumstances of the child in determining whether a retroactive award is justified ( DBS at para 110 ). Bastarache J. held that after separation, a child's standard of living should approximate as much as possible the standard the child enjoyed while the parents were together (at para 111). [ 32 ] In Bidwell , Burrows J. awarded a retroactive child support award for two children, who were 18 and 20. The eldest child lived on his own and attended university.

Burrows J. rejected the payor ’ s argument that the children would take no benefit from a retroactive award. He found that although both children were legally adults, they would benefit from a retroactive increase in support because both were still “ children of the marriage ” and in need of financial support from their parents (at para 9). [ 33 ] I find that this retroactive award will likely benefit Ciara. She is still a child of the marriage and in need of financial support from her parents. The Applicant has a continuing and on-going obligation to support her.

I find the award will likely continue to benefit the child and I do not doubt that the Applicant will continue to provide financial support to her child, regardless of where Ciara is residing. [ 34 ] I do not accept the Respondent ’ s contention that there is a requirement for the Applicant to specifically identify how a retroactive award will benefit the child of the marriage. There is nothing in the Child Support Guidelines which requires a recipient parent to account for monies received as periodic child support.

In my view, there is, similarly, no legal or policy requirement for the recipient of child support to account for how a retroactive award will be spent. [ 35 ] I also reject the Respondent ’ s argument that the fact that Ciara is not currently residing with the Applicant on a full-time basis eliminates the Applicant ’ s continuing legal obligation to support her daughter. Graesser J. held in LL that DBS does not preclude retroactive awards based on the residency of the children (at para 176.).

Retroactive awards can be made “ on the basis of being compensatory for hardships suffered as a result of increased maintenance not being paid when it was due and needed ” ( LL at para 176). Moreover, to give effect to this argument would allow the Respondent to avoid his clear financial responsibilities in this instance and, in effect, to reward him for ignoring both his annual financial reporting obligation and, more important, his obligation to support his child to a level commensurate with his actual income.

(4) Hardship occasioned by a retroactive award [ 36 ] There is no evidence before me as to any hardship that would be occasioned by the Respondent by making a retroactive child support order. As such, this is not a factor to be considered in this application. (

B) Windfall Arguments

[ 37 ] The Respondent strenuously urged upon me the potential windfall to the Applicant of a retroactive child support award. In SMN v DDR , 2003 ABQB 701 at para 61 , Coutu J. dealt with the concept of a windfall in the context of a retroactive child support award. She ordered retroactive support to the applicant, notwithstanding that the child was living with her grandparents and not the applicant mother at the time of the application. The payor argued that because the applicant did not apply for an increase in support while the child lived with her, this award would constitute a “ windfall ” .

In response to this argument, Coutu J. stated: A "windfall" is usually something you get for nothing. Ms. S.M.N., on her low income, bore Mr. D.D.R.'s child support obligations over many years. To that extent she was impoverished by him. If the court held that Mr. D.D.R. should not pay any retroactive support, would this not be a "windfall" for him? [ 38 ] I accept the Applicant's evidence that, in addition to the child support paid by the Respondent, the Applicant also used her own money and that of her new husband to support the child in the lifestyle of someone who is the daughter of the Respondent.

If the money was not forthcoming from the Respondent, it makes sense that it had to come from some other source. I do not accept that the Applicant was required to take out a loan in order to show that she used resources over and above the child support provided. Debt is a relative concept and I accept that she used her own money, as well as resources from her new husband, in order to supplement the support for Ciara when the money should have been coming from the Respondent.

The Applicant cared for the child without the full benefit of the proper amount of child support owing. [ 39 ] I agree with the comment of Coutu J. in SMN , wherein she stated (at para 65): [I]n cases such as this one, where an able payor fails to own up to his responsibilities to pay his fair share of support over a long period of time, it seems to me that greater injustice would be caused by refusing to grant the rightful claim.

Further, is it not better for the Courts to send a message to parents who do not pay their fair share that they could face a retroactive award than to send a message that if, as a payor, you get away with it long enough, you may never have to pay? [ 40 ] Both parents have an obligation to provide child support; it is a right of their child. If the Applicant had made annual applications throughout the past three years for proper financial disclosure and a corresponding increase in child support, the Respondent would most certainly have had to pay an increased amount.

Therefore, to not order a retroactive award would result in a windfall to the Respondent. Bastarache J. held in DBS at para 4 that “ [a]ny incentives for payor parents to be deficient in meeting their obligations should be eliminated. ” The Respondent cannot rely upon his own failure to disclose his financial information, and then argue that the Applicant will get a windfall if she receives the child support that ought to have been paid at the time. In my view, this would create an incentive for a payor to withhold income information.

If a payor parent knowingly does not exchange their financial information, and is then able to rely on the argument that the recipient is getting a windfall, or ask the court to require proof of how a retroactive award would benefit a child, they may never have to pay the full amount that their child was entitled to receive. VII. Conclusion [ 41 ] I find that the Applicant is entitled to retroactive child support. There was a reasonable excuse for the delay in seeking support. I also find that Ciara will benefit from this retroactive award and it will not constitute a windfall to the Applicant.

Finally, I find the Respondent engaged in blameworthy conduct. As a father, he owed an obligation to his child to pay child support commensurate with his income. He was fully aware of his obligation to exchange financial information with the Applicant on an annual basis and he failed to do so. The Respondent cannot benefit from his failure to fulfill his legal obligations in this regard. [ 42 ] The Respondent conceded that the Applicant ’ s assertion of quantum and the date of retroactivity were correct. Therefore, I order that the Applicant is entitled to $38,952 in retroactive child support.

I direct that this award be paid in a lump sum. I decline to impose any conditions on the payment of this retroactive child support award. [ 43 ] The applicant is entitled to costs. If the parties cannot agree on the quantum of costs, they may apply to me to resolve any disagreement within 30 days.

Heard on the 22 nd day of November, 2012. Dated at the City of Edmonton, Alberta this 19 th day of June, 2013. M.D. Gates J.C.Q.B.A. Appearances: Tina Huizinga for the Applicant Richard Rand Q.C. for the Respondent