Richards v Richards, 2013 ABQB 484

Court of Queen ’ s Bench of Alberta Citation: Richards v Richards, 2013 ABQB 484 Date: 20130823 Docket: 4801 145709 Registry: Calgary, Alberta Between: Linda Jean Richards Plaintiff - and - Timothy Owen Richards Defendant _______________________________________________________ Reasons for Judgment of the Honourable Madam Justice C.S. Phillips _______________________________________________________ I. INTRODUCTION [ 1 ] Linda and Timothy Richards were married on October 8, 1988. After 21 years of marriage, the Richards separated on August 29, 2009.

Linda Richards (the “Plaintiff”) filed a Statement of Claim for Divorce and Division of Matrimonial Property on September 20, 2010. The Statement of Defence was filed by Timothy Richards (the “Defendant”) in respect of this matter on November 17, 2011 and a Counterclaim for Divorce and Division of Matrimonial Property was filed by him on November 17, 2011. The parties are not yet divorced.

[ 2 ] The matter came to trial almost three and three quarters years after the parties separated. [ 3 ] As the Defendant is now bankrupt and a Trustee in Bankruptcy (the “Trustee”) has been appointed, I am unable to deal with the property issues and have therefore stayed that part of the Plaintiff’s application, such that the matter with respect to all property issues is effectively adjourned sine die . [ 4 ] Furthermore, the Plaintiff has filed a claim with the Trustee and is taking the position that the assignment of the Calgary West Campground (the “Campground”) lease from the Defendant’s company 333582 Alberta Inc. in favour of Mr.

Frederick (Fred) Richards’ company, Stardust Ranching Ltd. on January 17, 2013 was done to defeat his creditors’ claims and the Plaintiff’s claimed interest in 333582 Alberta Inc. and in the operation of the Campground and to defeat her claim for spousal support. II.

ISSUES [ 5 ] The Plaintiff filed a Statement of Claim for: (1) a Divorce Judgment; (2) an Order for Spousal Support; and (3) an Order directing that the Defendant pay costs of the action on a solicitor and client basis. [ 6 ] On May 2, 2013, the Plaintiff made an Application: (1) that the division of matrimonial property be adjourned sine die ; (2) that a declaration be made at trial that the Plaintiff has an interest in the Campground lease previously held by 333582 Alberta Inc. (the “Declaration”); and (3) that the Defendant be held in contempt of the Order made by this Court on December 6, 2011 and that he also be held in contempt of the direction by the case conference Justice that the Defendant provide a sworn statement respecting the Campground lease and for making false representations to this Court at a domestic special hearing on February 20, 2013 and at case conference on March 25, 2013, in respect of disposing of property. [ 7 ] As I noted, I have stayed the Plaintiff’s request that a Declaration be made at trial; I believe this is a finding that speaks to matrimonial property issues and can be reviewed pending the outcome of the Trustee’s investigation. [ 8 ] Having stayed the property portion (both the division of matrimonial property and the Declaration) of the Plaintiff’s application, I am therefore left to determine three issues: first, if the Plaintiff is entitled to spousal support and, if so, in what amount.

Second, whether to hold the Defendant in contempt of court. Third, if the Plaintiff is entitled to costs on a solicitor and client basis. III. FACTS AND HISTORY OF PROCEEDINGS [ 9 ] At the time the parties were married in 1988, they were young. The Plaintiff was 20 and the Defendant was 30 years old. Like all young couples, the parties had very little by way of assets at the time of their marriage. Both parties have a high school diploma, having successfully passed grade 12.

Further, there are no children of the marriage. [ 10 ] Prior to becoming involved in managing the Campground known as the Calgary West Campground, which is operated through 333582 Alberta Inc., the Defendant worked as a realtor and property manager and also worked at Prudential selling life insurance.

The Plaintiff at that time worked as a resident manager for rental suites which were owned by the brother of the Defendant, Fred Richards, and/or the Defendant’s father, William Richards. [ 11 ] Also, during this period of time the Plaintiff’s role in the marriage was to run the whole household and was primarily responsible for housekeeping and the like while the Defendant went out to work. [ 12 ] In 1995, the Plaintiff and Defendant took up residence on the large, well known Calgary West Campground and became the

managers of this operation which was a 24/7 operation for all practical purposes. During the time that the parties managed the Campground, which included hands-on work, the parties were each paid a salary of an equal amount. The Plaintiff and Defendant jointly managed this Campground and RV park and storage facility for 13 years while it was owned by third parties. [ 13 ] In 2005 the Campground was sold and then leased back to 333582 Alberta Inc. and operated as a leasehold by the Defendant’s brother Fred Richards, who was the sole shareholder and director of 333582 Alberta Inc. at the time.

According to Fred Richards, 333582 Alberta Inc. received $3,600,000.00 as its share of the net sale proceeds after repayment of financial obligations. Prior to the sale of the Campground, 333582 Alberta Inc. had an undivided 1/3 interest in title to the Campground property. [ 14 ] One of the terms of the leaseback of the Campground to 333582 Alberta Inc. as lessee was that it held a three year lease, expiring on October 15, 2008 for a yearly rental of $400,000.00.

Apparently, the decision as to how to allocate the sale proceeds from the Campground sale was made by the Defendant’s late father, William Richards, together with the Defendant’s brother, Fred Richards. According to Fred Richards, although he was the shareholder of record of 333582 Alberta Inc., the beneficial owner was his father, up until the sale of the Campground in 2005 and thereafter he was the legal and beneficial owner of 333582 Alberta Inc. until the transfer to the Defendant, effective October 15, 2008, as noted below. There is no paperwork to document this arrangement with his father.

Furthermore, Fred Richards says that he and his late father, William Richards, decided to gift out of the net sale proceeds $1,000,000.00 to his brother Tim Richards, the Defendant; $1,600,000.00 to his father’s wife, Iris Richards; and $1,000,000.00 to Fred, himself. [ 15 ] On September 27, 2005, 1184499 Alberta Ltd. (a company solely held by Fred Richards) transferred/paid the $1,000,000.00 gifted to the Defendant through to 1194925 Alberta Ltd. (a company solely held by the Defendant, Tim Richards).

The parties later renamed 1194925 Alberta Ltd. to “Darkhorse Capital Incorporated” (which name was reflected in both their e-mail addresses). There is no paperwork to substantiate this gift or transfer of $1,000,000.00 and the Defendant and his brother Fred Richards claim that it was a gift to only the Defendant and not the Plaintiff. At the time, the Defendant also gifted $100,000.00 of the $1,000,000.00 to the Plaintiff, which was used by the Plaintiff to make investments in the stock market.

It is very much in dispute as to whether the $1,000,000.00 gift to the Defendant is exempt as he claims or whether it was a gift to both the Plaintiff and Defendant as the Plaintiff claims. Notably, the Defendant reluctantly admitted at trial when asked: Q: Did you not handle that gift in a manner in which you informed Linda (the Plaintiff) that this was your and her money? that it was a gift to both of them for he stated: “... I’m not about to start a fight in my house, all right.

So to make things work easily, it was understood that we’d work together ...” In any event, however this $1,000,000.00 gift is ultimately characterized when the property issues between the parties are dealt with, it is clear this money was invested in the stock market for both their benefit and traded by both parties and in particular by the Plaintiff, who in my view subsequently became the main trader and administrator of the parties’ stock portfolio. [ 16 ] The parties continued to manage the Campground and to collect a salary from 333582 Alberta Inc. while conducting trading on their joint stock portfolio. [ 17 ] The parties continued to live at the Campground until early 2008, when mould was discovered in their residence at the Campground.

They then moved out of the Campground residence into a rental property, which rent was paid for by 333582 Alberta Inc. [ 18 ] During this time, the parties both became disgruntled with managing the Campground. They were concerned about the mould in their unit (which caused them to move off the Campground); they were concerned about vacation pay and other benefits and pay they claimed was owing to them, and both parties filed a request for payment initially with Fred Richards, who retroactively paid one year of bonuses to the parties and deferred other bonuses owed to a later date, which were never paid.

The parties then demanded payment of the bonuses and vacation pay by making Employment Standards applications. The Plaintiff’s evidence speaks to approximately $37,500.00 owing to each of them, plus a $10,000.00 performance bonus, which I accept.

At one point, Fred Richards claims that the Plaintiff and Defendant quit the Campground over this but then through their father, Bill Richards, acting as mediator, the Defendant came back to the Campground. [ 19 ] After the parties had moved off of the Campground, the Defendant continued to work at the Campground while the Plaintiff continued to be the main trader and administrator of their stock portfolio. By a joint decision of the parties, the Plaintiff attended investment seminars and travelled to Toronto and Vancouver to research investments. She had trading authority and power of attorney on

any accounts in the name of the Defendant and exercised these powers. Notwithstanding her involvement with the parties’ stock portfolio, the Plaintiff continued to be involved in the administration and management of the Campground, although to a lesser extent than she was previously. The Plaintiff testified when the parties lived at the Campground as resident managers, they were on call 24 hours a day, 7 days a week. However, after moving off the Campground with the Defendant, her duties at the Campground changed.

She advised that an arrangement was made whereby senior staff at the Campground started taking on more responsibilities (responsibilities that she and the Defendant used to be responsible for), and these senior staff would also supervise junior staff at the Campground. Nevertheless she would still advise the senior staff over the phone when they had issues or questions, and she would also attend the Campground in person to check on inventory, and to perform orders to keep the general store stocked, which she could do online from her computer.

The Plaintiff testified that the Defendant told her she needn’t be at the Campground every day, however: I did continue to contribute to the campground, however in the absence of--of being at the campground to watch the stock portfolios I did not know, in essence, that my employment had come to an end because I was still performing duties for the campground and was still receiving pay. [ 20 ] A resolution of the dispute over the bonuses and holiday pay owed to the Plaintiff and Defendant by 333582 Alberta Inc. through Fred Richards appears to have occurred effective October 15, 2008 for effective that date, the shareholding and directorship of 333582 Alberta Inc., which held the lease of the Campground and the right to operate the Campground, was transferred to the Defendant.

It appears that the Defendant acquired the shares of 333582 Alberta Inc., and claims that he was the sole shareholder of that company. This is of course disputed by the Plaintiff, for she claims that in October 2008 she became a beneficial owner jointly with the Defendant who holds the shares in this company. The Sale Agreement dated October 15, 2008, (which Fred Richards admits to something that he devised with no input from the Defendant) states that the Defendant paid $68,000.00 to Fred Richards for the Campground lease, which consideration the Plaintiff claims she contributed towards.

Also noteworthy in this Sale Agreement is the fact that Mr.

Fred Richards was to be paid $2,500.00 per month for accounting services, which I will discuss further below. [ 21 ] After the transfer of the shareholding and directorship of 333582 Alberta Inc. to the Defendant, the parties were terminated from the payroll of the Campground because they were no longer employees as their status had changed with the transfer. [ 22 ] The parties’ stock portfolio lost most of its value in October 2008 when the Defendant had used margin to buy stock. [ 23 ] Unbeknownst to the Plaintiff, her employment with the Campground was terminated on October 15, 2008 (the same date as the transfer referred to above), and a Record of Employment was issued, which was not provided to her at that time.

The Plaintiff first received this Record of Employment in September 2009, (after the parties had separated) giving the reason for her termination of employment as “Shortage of work/End of contract”, when to the Plaintiff’s knowledge there never was a shortage of work at the Campground as she continued to work there after October 15, 2008 until the date of separation on August 29, 2009. [ 24 ] I find as a matter of fact that during the period between the time the $1,000,000.00 gift was made to the company that became Darkhorse Capital Incorporated up to the termination of the Plaintiff’s employment at the Campground, the Defendant knowingly and intentionally took steps to “phase out” the Plaintiff from her involvement in operating the Campground.

The Defendant quite deliberately limited the Plaintiff’s involvement from her role in the operation of the Campground and subsequently terminated her employment with the Campground without her knowledge, going so far as taking steps to attempt to prevent her from gaining access to her Record of Employment. The Plaintiff testified, and I accept, that she was never provided with a physical copy of her Record of Employment when it was issued on January 28, 2009 by an accountant in Fred Richard’s office.

The Defendant, however, must have been provided with her Record of Employment, because he had given a copy of it to the parties’ accountant. [ 25 ] The Plaintiff continued to attend at the Campground up until the time the parties separated on August 29, 2009, after which she did not attend. She was not gainfully employed from August 29, 2009 until her recent employment in January 2013. [ 26 ] When the parties separated, the Defendant moved out of their residence and continued to operate the Campground without any involvement from the Plaintiff. [ 27 ] The parties attended at “Civilized Divorce” for mediation.

They also attended several times at mediation, and a draft separation agreement was prepared by the mediator. However, the Defendant failed to keep contact with the mediator, and the parties each retained legal counsel.

[ 28 ] For the months of September, October, November and December 2009, the Defendant paid the Plaintiff an amount of $7,500.00 per month, equalling a total amount of $30,000.00 paid in spousal support for 2009. [ 29 ] The parties later entered into an Interim Spousal Support Agreement dated June 16, 2010, which agreement retroactively characterized the Defendant’s 2009 payments to the Plaintiff (which she claims were being paid to her in part as her salary from the Campground) as spousal support, and stated that spousal support payments in the amount of $4,900.00 per month were to be paid to the Plaintiff commencing January 1, 2010 up to and including December 1, 2010.

The Interim Spousal Support Agreement also stated that from and after January 1, 2011, the Plaintiff reserved her right to further spousal support. [ 30 ] The Defendant made such spousal support payments as outlined in the Interim Spousal Support Agreement to the Plaintiff for the year 2010, equalling a total amount of $58,800.00 paid in spousal support for 2010. [ 31 ] The parties attended a DRO on June 22, 2011, and entered into a written agreement with respect to disclosure and the payment of spousal support.

The main terms of this agreement were: financial disclosure per FL-17 for the period of August 29, 2009 until the date of the signing of the agreement; and spousal support in the amount of $4,000.00 per month was to be paid for six months from July 1, 2011 up to and including December 1, 2011. [ 32 ] In 2011, the Defendant paid the Plaintiff six months of spousal support, equalling a total amount of $24,000.00 in spousal support for 2011 plus $50.00 to defray non-sufficient funds charges for a dishonoured spousal support cheque.

This $24,000.00 was the Plaintiff’s total income for 2011. [ 33 ] On December 6, 2011, Justice Bensler of this Court made an Order that: (1) the Defendant pay to the Plaintiff the amount of $4,000.00 spousal support on January 1, 2012; (2) spousal support was to be reviewed on January 25, 2012; (3) the investment account of Darkhorse Capital Incorporated was frozen; (4) the Defendant may pay the Plaintiff’s $4,000.00 spousal support from the Darkhorse Capital Incorporated trading account; (5) the Defendant shall not further dissipate any assets or matrimonial assets; (6) the matter was to proceed to a trial subject to the parties first attending a JDR; (7) costs shall be in the cause; (8) each party shall continue to provide the other party with a complete copy of his or her income tax return and any notices of assessment and reassessment issued to him or her by the Canada Customs and Revenue Agency on an annual basis, on or before July 1 st of each year and in the event that a party has not filed an income tax return for the previous year, he or she shall provide the other party with copies of his or her T4, T4A and all other relevant tax slips and statements disclosing any and all sources of income, including self-employment income; and (9) amounts owing under this Order shall be paid to the Director of Maintenance Enforcement, and shall be enforced by the Director. [ 34 ] The Defendant paid the spousal support payment of $4,000.00 on May 29, 2012, five months after it was ordered by Justice Bensler to be paid on January 1, 2012. [ 35 ] The parties attended a JDR on March 16, 2012, but were not able to settle. [ 36 ] The Defendant’s counsel filed a Notice of Withdrawal of Lawyer on January 15, 2013. [ 37 ] The Defendant through his company 333582 Alberta Inc. entered into an Assignment of Lease and Business (drafted by his brother Fred Richards) with Stardust Ranching Ltd. (a company held by his brother Fred Richards and his wife, Heesung Kim) on January 17, 2013, backdated effective as of January 1, 2013 (the “Assignment of Lease and Business”).

For the nominal amount of $2.00 consideration, 333582 Alberta Inc. assigned the Campground lease and business to this non-arm’s length company held by his brother, Fred Richards and his brother’s wife.

Although the agreement provides that Stardust Ranching Ltd. will enjoy all revenues and be responsible for all expenses associated with the lease and the operation of the business accruing from January 1, 2013, the Assignment of Lease and Business did not include an assumption by Stardust Ranching Ltd. of the existing liabilities of the Campground. [ 38 ] The Affidavit of Fred Richards sworn on April 26, 2013 and filed with the Clerk of the Court on the same day (the “Fred Richards Affidavit”), as well as his testimony, state that the cash flow problems being experienced by the Campground (and alleged by

Fred Richards to be due to the Defendant’s uncontrollable personal spending) were “unsolvable” and that outstanding liabilities as at December 31, 2012 in the amount of $134,087.82 forced Fred Richards to take over the operational management of the Campground as of January 2013 before the season started. Fred Richards maintains that his taking over the Campground was the only way to save the Campground from the financial difficulties associated with these outstanding liabilities.

I do not accept Fred Richards’ testimony on this point, and have serious issues with his credibility, which I will elaborate on further. [ 39 ] I find as a matter of fact that this Assignment of Lease and Business was done by the Defendant intentionally for less than fair market value to a non-arm’s length party and in contravention of this Court’s previous Orders for the sole purpose of diverting the Defendant’s income derived from the Campground in order to avoid his spousal support obligations.

I also note that the Defendant denied any existence of this Assignment of Lease and Business when the parties appeared before Justice Gates on February 20, 2013 for a domestic special hearing. Instead, the Defendant represented on February 20, 2013 that the transfer “hasn’t been done completely yet”, that “nothing has been completed” and “all I’ve done so far is put together a letter stating that - put just - that my brother would be handling things and covering the expenses, and probably be setting up a new corporation in order to cover - to make sure things are at his end covering”.

Justice Gates warned the Defendant that he needed to understand what Justice Bensler’s Order meant, that he couldn’t get rid of the Campground business, or any assets that were potentially matrimonial assets, and if he did so he could be found in contempt of Court and go to gaol.

Justice Gates, taking the Defendant’s representation that the transfer of the Campground had not yet been finalized, also reiterated at the domestic special hearing on February 20, 2013 that the Defendant was not allowed to dispose of the Campground without permission of the Court. [ 40 ] At the February 20, 2013 hearing Justice Gates ordered: (1) the matter to be set down for a trial commencing May 6, 2013 for five (5) days; (2) the matter was to be set down for a case conference on March 25, 2013 at 3:00 pm; (3) the Defendant was to forthwith provide to the office of counsel for the Plaintiff all documentation relating to any disposition of any nature whatsoever, executed or otherwise, pertaining in any way to any contemplated transfer of the campground operation/management/control of 333582 Alberta Inc. operating as Calgary West Campground; and

(5) Rule 9.4(2) (

c) of the Alberta Rules of Court was invoked. Clearly, by this Order, Justice Gates was not aware nor had he been advised of the Assignment of Lease and Business that had been made effective January 1, 2013. [ 41 ] The parties attended a case conference on the afternoon of March 25, 2013 before Justice Jeffrey. The morning of March 25, 2013 the Defendant and his brother, Fred Richards attended at the office of the Trustee. [ 42 ] The Defendant assigned himself into bankruptcy the day following the parties’ case conference, on March 26, 2013.

In his Statement of Affairs (Non-Business Bankruptcy (Form 79), the Defendant swore his total amount of debt was $276,679.54. The Defendant failed to make any mention of his impending assignment into bankruptcy to this Court or to the Plaintiff the day before at the case conference before Justice Jeffrey on March 25, 2013. Also, it is worthy of note that the Defendant’s brother, Fred Richards, attended with him at the Trustee’s office on the morning of March 25, 2013, where the Trustee met and asked questions of both of them prior to the filing of the paperwork putting the Defendant into bankruptcy.

Thereafter, in the afternoon of March 25, 2013, the Defendant attended with his brother, Fred Richards, at the case conference held by Justice Jeffrey. [ 43 ] The Plaintiff asserts that the Defendant’s Assignment of Lease and Business in respect of the Campground, and his assignment into bankruptcy, were both entered into as a scheme designed to be prejudicial to the Plaintiff and to the Defendant’s other creditors and to defeat their claims. The Plaintiff has already filed a claim with the Trustee to that effect.

I find that the Defendant’s actions in totality point to a deliberate and willful attempt to evade his legal obligations to the Plaintiff and were done in defiance of orders granted by Justices of this Court and without any prior notice to the Plaintiff. I also agree with the Plaintiff’s assertions that there is no reason the Defendant was compelled to assign the Campground lease.

His brother, Fred Richards could have simply carried out his obligations under the Sale Agreement of October 15, 2008 and set up an orderly payment plan of debts with its creditors, if there were early concerns that the Campground might end up in financial difficulties. There was no reason he could not have done so.

Furthermore, the Campground’s unpaid liabilities as at December 31, 2012 were $134,087.82, which could have been more than covered and absorbed by the Campground’s gross revenue which had been over $1,200,000.00 and $1,100,000.00 historically in 2010 and 2011, respectively and had netted the couple and in more recent years the Defendant between $200,000.00 and $300,000.00 at least in income.

The Defendant’s general lack of transparency and fulsome disclosure to this Court point to his lack of credibility, which I will deal with further. [ 44 ] The Defendant currently lives onsite at the Campground and has little to no monthly expenditures for housing. He states he is making $2,000.00 a month employed at the Campground and is charged $100.00 a week for rent by his brother’s company. The Defendant claims to be a manager at the Campground while his brother, Fred Richard, states that he is a consultant, although he is represented as a manager to Campground employees.

In any event, I do not see a significant distinction between his current duties at the Campground and those he was responsible for when he was the Campground manager when 333582 Alberta Inc. held the Campground lease prior to January 1, 2013.

[ 45 ] The Plaintiff has been employed part-time as a receptionist since January 2013 for $17.00 per hour, approximately 28 hours per week. [ 46 ] Neither party has any post-secondary education. IV. THE DEFENDANT ’S FAILURE TO DISCLOSE AND DISSIPATION OF ASSETS A. Mr. Tim Richards ’ Failure to Disclose [ 47 ] The Defendant has not provided a complete and accurate record of financial evidence to this Court.

As Justice Martin stated in McPherson v McPherson , 2012 ABQB 581 at para 92 (“ McPherson ”): [I]n a trial there is an independent and ongoing obligation to provide relevant and material documentation touching on the matters in issue.

In the case at bar this means all documents that relate to [the Defendant’s] personal and business financial resources, as his capacity to pay child and spousal support is very much in issue. [The Defendant] did not provide complete, reliable or up to date information for all the entities at play, with the result that a complete and accurate picture of his financial resources was not in evidence. [ 48 ] As in McPherson , the Defendant has not met his independent and ongoing obligation to provide this Court with the relevant and material documentation relating to his financial situation, both personal and business.

A complete and accurate picture of his financial situation is simply not in evidence before this Court.

This is so, notwithstanding the parties as earlier noted on June 22, 2011 at a DRO had agreed in writing to provide such disclosure from their separation date, and furthermore in questioning, undertakings were given to provide disclosure up to and including one month before trial, which was not done by the Defendant. [ 49 ] One example of the Defendant’s failure to disclose and lack of transparency with the Court, although I note there are many, is the fact that despite Justice Bensler’s Order on December 6, 2011, the Defendant quite deliberately undertook to dissipate assets by assigning the Campground lease away from his company 333582 Alberta Inc. through the Assignment of Lease and Business to Stardust Ranching Ltd. executed on January 17, 2013.

As noted earlier, he also failed to disclose that fact to this Court on multiple occasions, stating on February 20, 2013 to Justice Gates that “nothing has been completed it, it was actually just a matter of finding where we stand in order...” and on March 25, 2013 to Justice Jeffrey: “[t]hat (referring to the assignment) hasn’t been done” - when in fact it had. He went further to state before Justice Jeffrey: “After coming to court before, I realized that that wasn’t to be done, and it was actually just a consideration.

Now it has been stopped and nothing has been done.” The Defendant was contradicted on this point by his brother, Fred Richards, who interjected: “That’s not correct. No, he’s completely incorrect on that.

It will be transferred.” Notably, Fred Richards also misled the Court on this, as later discussed, for the Campground lease and business had already been transferred and assigned by March 25, 2013. [ 50 ] The Defendant also failed to disclose before Justice Jeffrey at that same case conference on March 25, 2013 that he was assigning himself into bankruptcy, despite his own testimony at trial that he and his brother Fred Richards met with the Trustee earlier that day to discuss his assignment into bankruptcy. [ 51 ] Another example of the Defendant’s failure to fully disclose financial evidence includes the fact that in his sworn

Schedule A (his Statement of Income, Assets and Liabilities) to Form FL-17 dated December 1, 2011, he lists his other income as $17,250.00 from dividends from 333582 Alberta Inc., yet in financial statements from 333582 Alberta Inc. prepared to September 30, 2011 and his T5 Statement of Investment Income from 2011, total dividends paid by that company to the Defendant are in the amount of $210,000.00.

No explanation for that discrepancy was offered by the Defendant. [ 52 ] There are numerous inconsistencies and dishonesties - simply too many to mention - in the sparse financial disclosure the Defendant has provided to this Court. Examples of these include: financial disclosure provided where the Defendant represented in another

Schedule A (Statement of Income, Assets and Liabilities) to his Form FL-17 on January 20, 2011 that “333582 Alberta Inc. has a lease on the campground that expires October 1, 2011", when in fact the lease had been renewed by an agreement dated October 6, 2010 for an extension of the term of the lease to April 15, 2012 - which term was further renewed to April 15, 2014 on March 19, 2012; his 2010 Ford F150 truck being listed as an asset in one affidavit and not another; and his explanation as to inconsistencies and disappearing

money in accounts has simply been to say: that he gambled it away, made loans to third parties (when he was fully aware that the money may never be repaid), spent it on drugs (cocaine to be specific), and other unaccounted for personal expenses. [ 53 ] Since the parties ceased cohabiting and throughout the parties’ proceedings before this Court, the Defendant has concealed financial evidence from this Court, and likely from the Trustee as well.

By his own testimony, the Defendant has not provided the Trustee with five years of the Campground’s tax returns, nor with five years of financial statements respecting the Campground, nor has he had any discussion with the Trustee as to what the Campground’s gross annual revenue was or what his previous typical income was as owner/operator of the Campground. [ 54 ] As the Defendant has not provided this Court with accurate and fulsome financial disclosure on his part, it is left to the Court to use its best efforts to impute his financial income and make certain findings of fact with respect to the Defendant’s financial position and the financial position of the Campground.

I accept the Plaintiff’s contention and find the Defendant left the marriage in August of 2009, controlling $750,000.00 in assets and a business - the Campground - which provided him with over $200,000.00 (as a conservative figure) in income each year from his salaried position as Campground manager and dividends payable to him from 333582 Alberta Inc. Yet as the Plaintiff points out the Defendant still assigned himself into bankruptcy in March of 2013 with personal debt in the order of approximately $276,000.00.

Notably, this spending was over and above the income received by the Defendant and the cashing in of assets, such as his stocks. [ 55 ] Overall, it is clear to me the Defendant has conducted himself in a blameworthy and non-bona fide manner during the litigation of this matter as far as disclosure is concerned. B. Mr. Tim Richards ’ Dissipation of Assets [ 56 ] The Defendant has not been forthright nor honest with this Court about his income and assets.

He has made deliberate efforts to dispose of and dissipate assets, with the most significant disposition being the Assignment of Lease and Business in respect of the Campground for nominal consideration to the non-arm’s length party, Stardust Ranching Ltd.; all of which was done in direct contravention of Justice Bensler’s Order of December 6, 2011.

This has been highly prejudicial to the Plaintiff from the point of view that the Defendant has lost significant income from what he had previously earned as an owner prior to this disposition. [ 57 ] Since at least the time the parties ceased cohabiting in August of 2009, the Defendant has not conducted his personal or business affairs with any measure of transparency, including those of his companies, 333582 Alberta Inc. and Darkhorse Capital Incorporated.

Rather, I find that the Defendant has engaged in a covert manner of disposing of and transferring assets and remaining intentionally underemployed in order to avoid his legal obligation to pay any meaningful amount of spousal support to the Plaintiff, to which she is entitled.

Consequently, it is simply not clear to this Court what the Defendant’s true financial picture is. [ 58 ] The Defendant’s own testimony has been that, despite not being known to gamble during the entirety of his more than twenty- year relationship with the Plaintiff, after separation money in excess of at least $500,000.00 was spent on gambling in the range of anywhere between $15,000.00 to $30,000.00 per month and $500.00 per day was spent on his cocaine drug habit over a six month period in 2012.

Given the Defendant’s lack of transparency and the general dearth of financial evidence before me, I cannot ascertain if this is in fact the case, as he claims. As the Plaintiff herself testified, anything could have happened to the money. [ 59 ] Since the separation, the Defendant has frittered away his money and intentionally disposed of financial assets and has not been forthright about his income.

For example, the Defendant himself admitted that at some point in 2012 (the exact date of which is not clear to me), he sold all of his stocks in his RRSP accounts because he had been told by his then−lawyer that his accounts may be frozen, so as he said he “decided to take care of business and clear it all out” and that he did. I also accept the Plaintiff’s assertion on the evidence before me that the Campground business accumulated payables in the amount alleged to be owing as at December 31, 2012 because revenue from that business was siphoned off by the Defendant.

In fact, the Defendant’s own testimony speaks to this as he admitted at trial to using the incoming cash from the Campground as his own personal income. The Defendant alone was responsible for collecting and depositing the incoming cash at the Campground. The Plaintiff testified, and I accept, that approximately 25 percent of the incoming revenue from the Campground was received as cash. During peak season, this could be as much as $5,000.00 per day. [ 60 ] Another example of the Defendant intentionally diverting revenue from the Campground for his own personal use is the fact

that when he ought to have been paying spousal support to the Plaintiff, he instead made loans to his friends of approximately $40,000.00in total over a period of the past four to six years. The most recent of these loans, which the Defendant testified to were not disclosed tothe Trustee as receivables, were made in 2012. [61] The Plaintiff testified, and I accept, that the Defendant stated to her in 2008 before the parties’ separation that he would“destroy her financially”.

His spending habits, his use of Campground cash for his own personal spending, his dissipation of assets, andlending considerable amounts of money to friends instead of paying spousal support to the Plaintiff, demonstrate this intention. V. CREDIBILITY A. Mr. Tim Richards [62] The behaviour of the Defendant described above, and the continued and deliberate lack of honesty, transparency andcooperation on his part with this Court, demonstrates his lack of credibility.

I am conscious of this lack of credibility in reviewing hisfinancial disclosure (what little we have), his testimony and the evidence he has provided. The Defendant has not been forthright norhonest with this Court, which reflects directly on his lack of credibility. [63] As I stated in Campbell v Campbell, 2007 ABQB 637 at para 77 (“Campbell”), the Defendant’s reluctance to cooperate doesnot reflect well on his credibility.

As in Campbell, where the evidence of the Defendant differs from that of the Plaintiff, I accept andprefer the evidence of the Plaintiff. [64] I similarly draw an adverse inference against the Defendant from his consistent failure to provide a thorough and accuraterecord of financial disclosure to this Court. As Justice Kryczka stated in Kamitomo v Pasula (1983), (AB KB), 50 AR280 at para 69, 29 Alta LR (2d) 375 (QB): The principles of law on adverse inference are well known. The leading statement is to be found in Wigmore, Evidence in Trials atCommon Law, 1979 (Chadbourn Rev.) at vol. 2, 285, page 192.

The failure to bring before the tribunal some circumstances, documents, or witness, when either the party himself or his opponent claimsthat the facts would thereby be elucidated, serves to indicate, as the most natural inference, that the party fears to do so; and this fear issome evidence that the circumstance or document or witness, if brought, would have exposed facts unfavourable to the party.

Theseinferences, to be sure, cannot fairly be made except upon certain conditions; and they are also open always to explanation bycircumstances which make some other hypothesis a more natural one than the party's fear of exposure. But the propriety of such aninference in general is not doubted. [65] The Defendant’s behaviour and conduct towards the Plaintiff and this Court adversely affects his credibility. The recordincludes a multitude of examples of his clandestine behaviour, of which I will mention a few significant examples.

These include hisdirect contravention of Court Orders on numerous occasions (and one of particular importance not to further dissipate any assets ormatrimonial assets, as ordered by Justice Bensler on December 6, 2011), as well as his lack of honesty testifying on certain points.

Hisresponses at times veered towards being flippant, disingenuous, and disrespectful, including such explanations for his conduct asspending all of his money because he thought the world was going to end, and that he thought the Campground business was slowbecause of the Aztec calendar, despite the fact he was aware the Campground’s telephone service may have been shut off in Novemberand December 2012 due to the bill not having been paid and therefore, it was unable to take bookings. Further, he stated that he neitherread nor understood the significance of Court Orders.

His explanation for this unbelievably was that although represented by legalcounsel until January 15, 2013, there was so much material “After a while, I just got tired of looking at it.” [66] His conduct also lacked transparency and honesty towards the Plaintiff concerning the proposed addition of her as ashareholder and director of the company that became Darkhorse Capital Incorporated, and why he failed to effect that change when quiteopposite representations were made to her in September 2005 and documents had been drafted to effect that change.

Similarly, theunderhanded way that he sought to terminate the Plaintiff from her employment at the Campground without her knowledge, andattempted to prevent her from receiving a physical copy of her Record of Employment, speak to his lack of honesty and credibility. Thislatter action by the Defendant served to prejudice the Plaintiff, who was not eligible to receive any substantial employment insurancebenefits until September 2009 because she had not filed for such Employment Insurance benefits until nearly eleven months after her

actual termination of employment. This is because she was not made aware of her termination on October 15, 2008 until she first received a copy of her Record of Employment in early September 2009 - nearly a year after the fact. Furthermore, the Record of Employment the Plaintiff did receive in early September 2009 was dated January 28, 2009, when it should have been issued and delivered to her within five calendar days after the end of the pay period in which an employee’s interruption of earnings occurs. B. Mr.

Fred Richards [ 67 ] The Fred Richards Affidavit and the testimony provided by the Defendant’s brother, Fred Richards is generally of limited value, as I found him to similarly lack credibility. His testimony, although polished, ultimately lacked candour and honesty. He chose his words carefully and was at times evasive in his responses (example: “[Stardust] has assumed the obligations [of 333582] as required”) in order to present facts in a way he clearly intended they be portrayed.

That is to present a version of events to this Court to have it believe that the Assignment of Lease and Business in respect of the Campground made effective January 1, 2013 was necessary in order to save the Campground from impending financial ruin. On cross-examination, Fred Richards had difficulty recollecting facts to questions put to him that did not seem to advance “his version of events” in any way.

For example, clearly a successful business man, Fred Richards suddenly for the most part became non-responsive and almost clueless when asked what the value of the Campground business would be if listed for sale as at May 2013. He admitted that he did not know what the Campground business was worth but that he would not have taken it over, if he didn’t think it was something worth saving.

He suggested that the business may not be financially successful in 2013, full well knowing that the Campground virtually has a monopoly within the city limits of Calgary, and that he would save between $200,000.00 and $300,00.00 in income by not paying his brother, the Defendant the equivalent of what the Defendant had previously taken out of the Campground business as an owner but was no longer receiving since the Assignment of the Lease and Business in January 2013. [ 68 ] I find Fred Richards not only participated in this scheme designed to transfer and assign the Campground and its business to his and his wife’s company, Stardust Ranching Ltd., by way of the Assignment of Lease and Business but he was the mastermind behind it and exerted pressure on the Defendant to enter into and comply with it.

In fact, Fred Richards acknowledged at trial that he probably said to the Defendant he didn’t think the Defendant had any choice but to do what he was proposing. I accept the Defendant’s testimony on this point that he was actually “reluctant” to assign the Campground lease, but he did so on the advice of his brother, Fred Richards. As Fred Richards himself further testified on this: I had already resolved in my own mind that I was going to speak to the owners and have them re-enter the campground and appoint me [...] as the new lessee, or lessor, of the [...] campground ...

I’ve written to them and advised them and that asset is gone forever from the standpoint of ever being renewed to anything associated with [the Defendant] because of the mishandling of it. [ 69 ] That Fred Richards both created and implemented this scheme is supported by his own testimony that it was entirely his idea for the Defendant to assign himself into bankruptcy, and that Fred Richards personally drafted the Defendant’s Statement of Accounts payable to his creditors, which was provided to the Trustee and used to prepare the forms to assign the Defendant into bankruptcy.

Similarly, instead of the Defendant providing a sworn statement as per this Court’s (Justice Jeffrey’

s) direction of March 25, 2013 during the case conference, Fred Richards drafted the Fred Richards Affidavit and the Defendant provided a Statutory Declaration on May 2, 2013 adopting the Fred Richards Affidavit in its entirety, without having reviewed the final Fred Richards Affidavit together with its exhibits. [ 70 ] Although I accept that the Campground was in some financial difficulty due to the Defendant’s mismanagement of the business, and diverting revenue to cover his excessive personal spending habits, I do not accept the “version of events” as it was repeatedly advanced by the Defendant and his brother, Fred Richards, that the Campground no longer had value as an asset and the immediate assignment of the lease to Fred Richards and his wife’s company, Stardust Ranching Ltd., was necessary to save it.

As I will discuss further in my analysis, the entirety of evidence on record has established that the Campground was a thriving business that offered to the public camping and RV sites and facilities during April to October and daily access to RV and trailer storage facilities throughout the year but during limited hours from mid-October to March. I reject the proposition that the only way to address the financial liabilities facing it was to assign the Campground lease (property that was subject to Justice Bensler’s Order not to be dissipated) away from the Defendant’s company.

Rather, the cumulative effect of the Defendant and his brother’s participation in and testimony justifying this scheme speaks directly to their lack of credibility. [ 71 ] Many of Fred Richards’ assertions were simply not substantiated in any way and he offered little in the way of explanations.

Fred Richards is a successful and astute business man, and his actions demonstrate the thoughtful and measured steps he takes in business, such as running the $1,000,000.00 gift through his numbered shelf companies to the Defendant’s renamed company, Darkhorse Capital Incorporated to avoid “tracking”, to use his words, and sending emails and other paperwork to document actions after the fact.

Examples of the latter are: making the Assignment of Lease and Business effective January 1, 2013 when it was signed on January 17, 2013 and sending emails to the Campground landlord after the fact confirming his company’s assumption of the Campground lease. However, his testimony and evidence were not consistent with this persona when it served his purposes.

Repeatedly, Fred Richards had difficulty recollecting an event put to him, or he claimed to have no knowledge of something, such as his claim not to have known when he became aware of Justice Bensler’s Order, and that he didn’t look very closely at it in any event. [ 72 ] Similarly, documentation was provided by him when it advanced his “version of events” but several of his claims were not documented in any way.

Thus, he offered no documentation to support his claims to initially be holding 333582 Alberta Inc. as a company in trust for his late father, who he testified was the beneficial owner of the company prior to 2005. Neither did he have any documentation from the landlord to support his contention that the Campground was in arrears of 2012 rent until November 2012. In fact, Fred Richards acknowledged on cross-examination that the landlord was not aware of any defaults, other than a delay in paying the rent, until he had spoken to him.

Likewise, although Fred Richards was adamant that the Campground was in a desperate situation and on the brink of financial ruin, he could not offer any budgets or financial statements or forecasts for the Campground that he had done to ascertain how he had come to such a conclusion, and what steps he would take to “save” the Campground. His response, when challenged on that point on cross-examination, was to state that he had done a handwritten budget but not a serious budget, which he could not produce nor was offered as evidence at trial.

Curiously, neither did Fred Richard’s provide a fully-signed copy of the Lease Extension and Amending Agreement dated March 19, 2012 with the landlord’s signature despite the claimed negotiations and discussions with the landlord. In any event, the

Schedule “C” of monthly base rental payments attached to this March 19, 2012 Amending Agreement shows there was no rental payment owing to the landlord until June; something both the Defendant and Fred Richards acknowledged was done so as to accommodate the seasonal month-to-month fluctuations of the Campground business; thereby in my view, making Fred Richards’ claim they would be in jeopardy with their landlord in early 2013 unless he stepped in to save it in January 2013, not credible. [ 73 ] The Defendant testified on more than one instance that he withheld information from this Court on the advice of his brother, Fred Richards.

While I do not accept that the Defendant can absolve his responsibility by blaming his brother, Fred Richards, for his lack of candour and dishonesty, his testimony speaks to the lack of credibility of both himself and his brother, Fred Richards, and their joint participation in this scheme. This includes the fact that the Defendant testified he did not inform the Court of both the Campground lease assignment and his impending assignment into bankruptcy because he was advised not to by his brother. Fred Richards denied issuing such instructions to the Defendant, stating that he must have been confused.

I reject that and accept the Defendant’s testimony that Fred Richards has been the person who ultimately created this scheme and has made every effort to advance it before this Court. [ 74 ] Moreover, Fred Richards was not honest nor forthright with this Court as to what had transpired when he accompanied the Defendant to Court on the afternoon of March 25, 2013 and then disputed the transcribed evidence from March 25, 2013 presented to him on cross-examination at trial.

Fred Richards accompanied the Defendant to Court on the afternoon of March 25, 2013 after the Campground lease had already been assigned to Stardust Ranching Ltd., a company he controlled with his wife, stating to Justice Jeffrey that such assignment “will be done”; not that it had been done. On this, I accept the Plaintiff’s assertion that Fred Richards without reservation attached no importance to Justice Bensler’s Order of December 6, 2011, and his actions and testimony and advice to the Defendant demonstrate as much.

Also, the Defendant’s Form 79 bankruptcy disclosure, which was based on a Statement of Accounts payable to the Defendant’s creditors prepared by Fred Richards and provided to the Trustee to aid in the preparation of Form 79, failed to disclose the correct consideration of $2.00 for the assignment by the Defendant of the Campground lease to Stardust Ranching Ltd. Form 79 in Box 13 shows the consideration for the assignment of the Campground lease to be $1.00, when it should have been $2.00.

Although this is a minor discrepancy, one would have thought for such a major transaction involving a significant asset such as the Campground being disposed of by the Defendant, where previously the Defendant’s whole livelihood had been dependant upon it, that the information provided to the Trustee on this would have been correct. [ 75 ] Further, Fred Richards well knew that by paying nominal consideration of $2.00 for the Assignment of Lease and Business, he was doing so to the clear prejudice of the Plaintiff and the Defendant’s creditors.

Fred Richards knew of the Defendant’s financial situation and his personal debt of approximately $276,000.00 and as an astute businessman must have known that this Assignment of Lease and Business was suspect and at the very most prejudicial to the Plaintiff’s and Defendant’s creditors. He conceded he was present with the Defendant at the first two hour meeting with the Trustee on the morning of March 25, 2013 and that no tax returns for the Defendant, nor financial statements and tax returns for 333582 Alberta Inc., were provided to the Trustee.

Clearly, if the Trustee had been provided with that information, which would have shown that the Campground had historically been a thriving business, it may have raised a number of red flags and further inquiries. Certainly, on the face of it as Plaintiff’s counsel suggests (with which I agree) that for Fred Richards’ company, Stardust Ranching Ltd., “its got to be one of the sweetest deals in this City.” [ 76 ] I reject Fred Richards’ testimony that the Defendant was hired back in January 2013 as a consultant rather than a manager at the Campground.

Fred Richards’ company re-hired the Defendant into what is effectively his former position as Campground manager, simply for less remuneration and a different title. I find the difference between the Defendant’s former role and current role to be negligible, especially in light of the fact that both the Defendant and Fred Richards are representing the Defendant as being the manager to Campground employees. Furthermore, I find it difficult to accept why Fred Richards would re-hire the Defendant back at the

Campground at all, given his serious concerns about the Defendant’s mismanagement of the Campground. Fred Richards offered no credible explanation to this Court as to why the Defendant was re-hired back at the Campground in 2013. [ 77 ] I also find Fred Richards’ testimony and the Fred Richards Affidavit regarding the necessity of his taking over of the Campground lease problematic, especially after having reviewed the Sale Agreement of October 15, 2008 which specifically states that Fred Richards was to be paid $2,500.00 a month for his providing “accounting services”.

The “accounting services” enumerated under the 2008 Sale Agreement for which Fred Richards was to be responsible include such tasks as: preparing weekly cash-flow reports; preparing month-end [operating statements] within two weeks from month end and year-end operating statements within seven weeks of year end; managing cash to ensure all payments are met; paying accounts per invoices/statements provided on approval from Tim Richards and writing cheques; preparing bi-weekly and monthly payroll and writing cheques; and preparing GST reports quarterly and paying overdue GST due to Revenue Canada. [ 78 ] The Defendant’s testimony was that the Campground business was in jeopardy, a risk which he stated, upon the advice of his brother alone, required the Campground lease be assigned from his company 333582 Alberta Inc. to his brother and wife’s company, Stardust Ranching Ltd.

He stated that a debt had accumulated that he (the Defendant) hadn’t taken care of, which by his account put the financial viability of the Campground at risk for 2013. The debts not paid, according to the Defendant’s testimony, included GST, maintenance, electrical and gas bills. I am at a loss, however, to understand why accounts were suddenly not paid in 2012 when Fred Richards was responsible for and obligated to take care of these “accounting services” since October 15, 2008 as per the terms of the Sale Agreement.

By his own testimony, Fred Richards indicated the reason he took over the accounting services on October 15, 2008 is because the accounting “is the backbone of the campground business.

Without the accounting someone like Tim would not probably be able to have managed the Campground or in the alternative the accounting services would have been too onerous in terms of the expense...” [ 79 ] Fred Richards testified that he never signed a single cheque for the Campground until recently, that he never looked at any of the Campground’s financial statements, and that to suggest he was responsible for such tasks is to confuse accounting services with managerial financial services.

I reject this argument; on its face, the Sale Agreement provided for Fred Richards (or his designated employee) to provide accounting services and managerial type financial services for the Campground. By his own testimony, he was to look after the accounting for the Campground.

It is disingenuous for Fred Richards to argue that he was only apprised of the problematic financial situation and liabilities of the Campground in early 2013 - at a point when he claims the only solution was for him to take over the Campground lease - when by his own Sale Agreement he was responsible for reviewing its finances and paying its accounts and in particular, paying overdue GST due to Revenue Canada. [ 80 ] On this point I accept the Plaintiff’s argument that, under the terms of the Sale Agreement of October 15, 2008 and specifically the “accounting services” for which he was responsible, Fred Richards was already in a position to review the Campground’s finances and to know whether the invoices were being paid up to and including December 31, 2012.

Performing all of the “accounting services” included in the Sale Agreement was already Fred Richard’s responsibility per the terms of that agreement, and I do not accept his Affidavit evidence that he only became aware of the “initial cash flow problems” besetting the Campground at a point where they “would have become unsolvable”. [ 81 ] Furthermore, Fred Richards was evasive on the issue of why 333582 Alberta Inc. continued to exist after the Assignment of Lease and Business, when it was insolvent and appeared to serve no further purpose.

His explanation was that it was required to be kept intact because of its liabilities. He was evasive as to what the agreement was in respect of dealing with the liabilities and acknowledged there was nothing in writing concerning whose obligation it was for the liabilities that had accrued prior to the Assignment of Lease and Business.

Moreover, he stated that “having read the documents..., there’s no obligation on the part of Stardust to assume any obligations of 333582.” [ 82 ] I also reject Fred Richards’ claim that a covenant in the Campground lease had been breached, which breach would have put the lease with the landlord in jeopardy.

Nothing was advanced to support this claim, and I have seen no documentation to that effect or any notice that would have been served on the Defendant by the landlord. [ 83 ] Finally, Fred Richards tried to minimize the Plaintiff’s work done at the Campground; denied that she attended meetings when in fact she did; and tried to allocate blame solely to her when it was not only her but the Defendant as well, who did not want to live at the Campground as a result of the Campground residence mould problem.

In fact, the Defendant did not live at the Campground residence for a period of two years because of the mould problem. C. Ms. Linda Richards

[ 84 ] I do not question the credibility of the Plaintiff; I accept in large part her testimony and find she presented an accurate representation of the facts and of her financial circumstances. I also accept her evidence and testimony with respect to much of the Defendant’s financial circumstances, including the Campground operation and financials. I also accept the Plaintiff’s assertion that she is employable and has made every effort to secure employment. More specifically, I found the Plaintiff gave her evidence in a detailed, forthright, and honest manner at trial.

It was evident that she had spent hours preparing the Binders, Exhibits 1 to 3, presented at trial and that she knew full well the case she had to make as a Plaintiff before this Court. There was no evidence whatsoever to suggest that she had not been fully cooperative with this Court; if anything she had attempted to resolve this matter with the Defendant but had been stymied at every step of the way in the Court process. VI.

THE POSITION OF THE PARTIES [ 85 ] The Plaintiff requests spousal support for herself retroactively for twenty-two months and ongoing support of $2,767.00 per month, both on a without prejudice basis pending the result of the Defendant’s bankruptcy proceedings and the investigation of the Trustee. [ 86 ] The Defendant responds that the Plaintiff is not entitled to spousal support, as she has not suffered any economic disadvantages arising from the marriage or its breakdown such that she should be awarded spousal support to relieve any economic hardship based on the factors identified in

section 15.2(4) of the Divorce Act , RSC 1985, c 3 (2d Supp) (the “ Divorce Act ”). [ 87 ] In the alternative, the Defendant argues that if the Plaintiff has suffered economic disadvantages arising from the marriage or its breakdown and is entitled to spousal support, the spousal support already paid by the Defendant is a reasonable period of time for the Plaintiff to have secured employment and is an amount sufficient to promote the economic self-sufficiency of the Plaintiff.

On this point the Defendant argues that the Plaintiff has failed to establish on a balance of probabilities that she has made reasonable efforts to better her economic position either by way of education or by applying for positions suited to her skills and physical abilities. [ 88 ] The Defendant also claims that the spousal support payments that he has made to date meet the objectives of

section 15.2(6) of the Divorce Act , which are described as “autonomy and finality” by the Supreme Court of Canada in Miglin v Miglin , 2003 SCC 24 at para 57 , [2003] 1 SCR 303, and are in an amount of and of a duration that is an adequate contribution towards the promotion of economic self-sufficiency for the Plaintiff and adequate to alleviate any economic disadvantages that she may have suffered from the marriage, or its breakdown.

In any event, the Defendant submits he does not have the income or funds to pay the Plaintiff the retroactive or ongoing spousal support she claims is owing to her. [ 89 ] The Defendant also contests the Plaintiff’s request for solicitor-client costs, on the basis that the Plaintiff is financially capable of paying her own costs and the Plaintiff’s claim for solicitor-client costs is not justified. VII. ANALYSIS A. Spousal Support [ 90 ] The main issue for me to determine is whether the Plaintiff is entitled to spousal support and, if so, in what amount, and for what period(

s) of time. i. The Plaintiff ’s Entitlement to Spousal Support [ 91 ] The framework for determining whether spousal support is warranted in the Plaintiff’s case is set out in the Divorce Act . In making an order for spousal support,

section 15.2(4) requires the Court to take into consideration the condition, means, needs and other circumstances of each spouse, including the 21 years the Richards cohabited and the functions performed by each of them during cohabitation; and any order, agreement or arrangement relating to support of either spouse.

[92] The objectives of an order for spousal support are set out in

section 15.2(6) of the Divorce Act. An order under that sectionshould (

a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown; ...(

c) relieveany economic hardship of the spouses arising from the breakdown of the marriage; and (

d) insofar as practicable, promote the economicself-sufficiency of each spouse within a reasonable period of time. [93] As the Supreme Court of Canada in Moge v Moge, (SCC), [1992] 3 SCR 813, 99 DLR (4th) 456 (“Moge”)found no priority is to be given in the factors considered or objectives sought. The Court at p 866-67 further stated: The exercise of judicial discretion in ordering support requires an examination of all four objectives set out in the Act in order to achieveequitable sharing of the economic consequences of marriage or marriage breakdown.

This implies a broad approach with a view torecognizing and incorporating any significant features of the marriage or its termination which adversely affect the economic prospects ofthe disadvantaged spouse. Not all such elements will be equally important, even if present, to the awarding of support in each case. [94] In essence, the Divorce Act gives a court flexibility to deal with different marital situations on a case by case basis.

JusticeMcLachlin (as she then was) also discussed entitlement to spousal support in the Supreme Court of Canada case of Bracklow v Bracklow, (SCC), [1999] 1 SCR 420 at para 37, 169 DLR (4th) 577 (“Bracklow”), finding there are three grounds for entitlementto spousal support: compensatory, contractual and non-compensatory.

The Court went on to state that the judge must consider all threegrounds for entitlement, and any or all of them may figure in the ultimate order, as may be appropriate in the circumstances of the case. [95] Taking into account all of the facts of this case and the circumstances of both parties, I find that Ms. Richards, the Plaintiff, isentitled to spousal support from Mr. Tim Richards, the Defendant, on both compensatory and non-compensatory grounds.

While thePlaintiff is certainly entitled to spousal support on compensatory grounds, a broad consideration of all of the factors relating to theparties’ financial positions (i.e. their condition, means, needs and other circumstances) entitles her to spousal support on non-compensatory grounds as well. See Bracklow at para 40. [96] The Plaintiff’s entitlement to spousal support is based on a careful review of all of the evidence before me, including thecondition, means and needs of each of the parties. This was a 21 year marriage. During the marriage, the parties functioned as aneconomic unit.

While the parties jointly worked at the Campground, the Plaintiff also continued to perform functions at home and wasthe primary spouse responsible for their stock portfolio. When the Defendant started to “transition” the Plaintiff away from her role inmanaging the Campground (without her knowledge), she correspondingly performed more functions at home and in managing their jointtrading account.

This was an interdependent relationship in many respects, and the Plaintiff contributed to the relationship in a way thateconomically benefited both parties. [97] A consideration of the Plaintiff’s condition, means and needs also demonstrates her need for spousal support, particularly the economic hardship she has suffered. This economic hardship has been as a result of both her health problems and career disadvantages,and the fact that the only work she has really been trained to do was at the Campground. See Bracklow at para 41.

Her circumstancesfollowing separation have been challenging: she has lived a frugal and fairly meagre subsistence, with little financial support from theDefendant and very limited financial resources. She has suffered considerable health problems, many of which still beset her. ThePlaintiff testified, and I accept, that she suffers difficulties with her eyes, as she has abnormalities in her optic nerves that have to beclosely monitored because it resembles glaucoma. She has suffered permanent damage in her right knee. She has had surgery on it, andstill experiences pain and instability in her knee.

She has a torn left biceps tendon and problems with her right wrist, which she fracturedat the Campground the first year she worked there. She has had reconstructive surgery on the wrist and currently experiences a limitedrange of motion, which also limits the jobs available to her. Furthermore, the Plaintiff currently has limited financial means to supportherself other than her current job where she does not draw a significant salary, having earned $17.00 per hour working as a part-timereceptionist since January 2013.

At this time, she does not have the skills, training or experience to do another job than the one shepresently is in, as her experience working at the Campground was highly specialized.

The Plaintiff’s present condition, needs and meansare such that she requires spousal support. [98] I do not accept the Defendant’s assertion that the Plaintiff has not suffered any economic disadvantages arising from themarriage or its breakdown; the evidence before me establishes she most certainly has suffered economic disadvantages and hardshiparising from the breakdown of the marriage while the Defendant at separation was clearly better economically advantaged than was thePlaintiff at separation.

The Plaintiff states, which I accept, that the Defendant controlled 90 percent of their assets at separation, and sinceseparation he has enjoyed for the most part all of the income of the assets as well as encroached on and dissipated the parties’ assets asevidenced by his own Statutory Declarations and the testimony he gave at trial. The Plaintiff claims that she left the marriage controlling$65,000.00 in assets, which I also accept. The Plaintiff is currently left with slightly over $30,000.00 in assets and states that she owesmoney to the Canada Revenue Agency.

In comparison, the Defendant left the marriage controlling $750,000.00 in assets and a business

which provided him with over $200,000.00 in income each year. [99] Neither do I accept the Defendant’s alternate argument that the spousal support (in the amount of $116,800.00 for a total of 23months between 2009-2012) already paid by the Defendant is a reasonable period of time for the Plaintiff to have secured employmentand is an amount sufficient to promote the economic self-sufficiency of the Plaintiff.

First, the Defendant claims in his closing brief thathe has paid two and a half years of spousal support when in fact, he has paid only 23 months of support to the Plaintiff, which is less thantwo years’ worth of spousal support. Second, the courts have repeatedly stated that economic self-sufficiency, while one of theobjectives, does not have priority over the other objectives in

section 15.2(6). Third, I find that the amount of $116,800.00 the Defendanthas paid for a total of 23 months between 2009-2012 is insufficient, taking into account all of the evidence before me, as well as theamounts of spousal support recommended by the Spousal Support Advisory Guidelines. [100] I accept the Plaintiff’s evidence and am satisfied that she has made more than reasonable efforts to better her economic positionby undertaking a thorough job search and applying for any job that she felt qualified for, even going so far as volunteering when shecould not find a paid position.

That her job search efforts have been bona fide are supported by the documentation she provided at trialwhere she was congratulated in meeting certain criteria and passing tests including polygraph tests; although to date she has unfortunatelynot secured her desired employment position. This is in the face of the Plaintiff’s numerous health concerns already discussed, includinga time in May 2011 when her health was in such a bad state that she had to go to the emergency room for an infected salivary stone.

Shetestified, and I accept, that during the period of 2011 she was not even physically capable of working due to her poor health, yet she wasstill applying for jobs and attending at interviews.

I also accept the Plaintiff’s evidence that her past work experience from working atthe Campground is highly specialized to that business, that no comparable opportunities exist, and that she is finding it difficult to applyskills gained from working at the Campground to secure employment elsewhere. [101] Neither do I accept the Defendant’s claim that the spousal support payments that he has made to date sufficiently satisfy theobjectives of

section 15.2(6) of the Divorce Act such that no further payments are warranted. While the Court takes into account thespousal support payments already made by the Defendant, a careful consideration of all of the facts of this case with a view to meetingthe objectives of

section 15.2(6) of the Divorce Act, necessitates that further payments of spousal support are required, includingretroactive payment for support payments not made. [102] Furthermore, a review of the condition, means and needs of the Defendant leads me to find that he was and is in a position topay spousal support, notwithstanding his claims to the contrary. I will deal further with the Defendant’s “means” in my analysis below ofhis income and financial resources, which I have imputed to be significantly more than he has represented to this Court.

Per Southin J.A.in Muirhead v Muirhead (1995), (BC CA), 6 BCLR (3d) 229 at para 14 (BCCA): In my opinion, "means" in subs. (5) includes not only what the parties are earning but what they can reasonably be expected to earn. [...]A husband who is capable of earning a decent income cannot say "I am not going to" and, therefore, "no order may be made against me".[emphasis added] [103] I therefore find that the Defendant has and did have the means to pay spousal support.

The Defendant has been the author of hisown misfortune for as he indicated at trial the reason he is in this predicament is that he “personally spent more money than what shouldhave been spent during that period. So it ended up the expenses caught up to me.” I also find that he has not been disadvantagedeconomically by the breakdown of the marriage, but has been advantaged economically by it.

I accept the Plaintiff’s assertion, and theevidence before me supports the fact that, the Defendant’s credit card statements demonstrate that since the parties’ separation, theDefendant has been living a comfortable life in comparison to the Plaintiff, staying in hotels and motels, making frequent purchases fromliquor stores, attending adult entertainment shops, restaurants, and travelling in Canada. As earlier noted, he testified that he was at onepoint spending $500.00 a day on cocaine, for a period of approximately six months during 2012.

He also acknowledged that despite thefact he claimed the Campground lost $30,000.00 in bookings in November and December 2012, the Campground would gross$1,000,000.00 during a a period of six months, which typically in the past netted profits, being his income of at least $225,000.00 in thefirst year the Defendant operated it as an owner. In contrast, the Plaintiff has lived a meagre existence, having received periodic amountsof spousal support at unreliable frequencies and not having found employment until January of 2013. ii.

Calculating the Quantum of Spousal Support to be Paid [104] In order for me to determine the appropriate amount of spousal support to award to the Plaintiff, I need to calculate the parties’respective incomes. Calculating the Plaintiff’s income is a straightforward exercise, but it is with no small measure of difficulty that Iturn to calculating the Defendant’s income. As I have already stated, I view the Defendant’s assignment of the Campground lease and itsbusiness and his lack of meaningful disclosure regarding the transfer of his assets as calculated attempts to undermine his legal

obligations. In the result, I have drawn an adverse inference from his lack of cooperation and disclosure with this Court. [ 105 ] In calculating the Defendant’s income for the purposes of determining an award of spousal support, including the imputation of his income for the years 2011 to present and on a go-forward basis, I look to the recent judgment of Kostin v Eaket , 2012 ABQB 756 (“ Kostin ”).

As Justice Jones of this Court discussed in Kostin at paras 140-142 : [...] Kostin's counsel [...] notes in her submission that the determination of guideline income for child support purposes, in a situation where a payor is a shareholder, director or officer of a corporation, is specifically addressed in

section 18 of the Federal Child Support Guidelines (the "Guidelines"). In that situation, where, in the Court's opinion, that spouse's annual T1 line 150 income does not fairly reflect all of the income available to the spouse for the payment of child support, the Court may invoke section 18(1)(

a) of those guidelines and include in the spouse's income all or part of the pre-tax income of the corporation for the most recent taxation year. Kostin's counsel suggests that I should, for purposes of partner support, rely on the provisions of section 18(1) (

a) of the Guidelines to add the pre-tax income of 1396775 to Eaket's line 150 income to establish his income for purposes of applying the Spousal Support Advisory Guidelines. She further argues that I should apply

section 19 of the Guidelines to impute income to Eaket on the basis that he is intentionally underemployed. His income thus re-determined would form the basis for application of the Spousal Support Advisory Guidelines. Though it may be common practice to incorporate provisions of the Guidelines , such as sections 18 and 19 , in arriving at income for spousal or partner support purposes, there is no legislative basis for doing so. Nevertheless, I consider it entirely appropriate to approach the determination of Eaket's income utilizing these presumptive "tools".

I can think of no policy reason why they would be appropriate for purposes of determining income for child support purposes but not for spousal or partner support purposes. Other courts seem to have taken this approach. For example, in Rapoport v Rapoport , 2011 ONSC 4456 , the Court said at para. 512: SSAG [the Spousal Support Advisory Guidelines] is not mandatory. It is only a guide, yet a good one and a good place to start in normal circumstances.

It requires the determination of the payor's annual income as calculated in the Federal Child Support Guidelines , and once this is calculated, the application of a formula to the amount will produce a recommended range of spousal support which the court must then settle upon. It is therefore necessary to revisit the annual income calculations determined above in connection with child support. Similarly, the Court in Laurain v Clarke , 2011 ONSC 7195 , 16 RFL (7 th ) 316 held as follows at paras. 27-28: Like the Child Support Guidelines, the Spousal Support Guidelines refer to imputing income to a payor spouse.

They do not, however, expressly provide for how this should be done. Instead, they adopt the methodology prescribed by the Child Support Guidelines. The Spousal Support Guidelines provide in this regard: The starting point for the determination of income under both formulas is the definition of income under the Federal Child Support Guidelines , including the

Schedule III adjustments...

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