TA v ST, 2017 ABQB 414

Court of Queen’s Bench of Alberta Citation: TA v ST, 2017 ABQB 414 Date: 20170630 Docket: 4801 159602 Registry: Calgary Between: T.A. Plaintiff - and - S.T. Defendant _______________________________________________________ Memorandum of Decision of the Honourable Madam Justice S.L. Hunt McDonald _______________________________________________________ I.

Introduction [ 1 ] The trial of this action is related to a claim for divorce brought by T.A., the husband, and a counter-claim brought by S.T., the wife (together, the “Parties”). [ 2 ] The issues at trial were child support and spousal support, both ongoing and retroactive. As well, the Parties sought a division of their matrimonial property, which mostly includes sale proceeds from the matrimonial home that was registered in the name of T.A. and his sister, F.N. (the “Sister”), located in Northeast Calgary (the “Matrimonial Home”).

S.T.’s name was not registered on title. [ 3 ] For the reasons set out below, I find the following: (

a) There will be no matrimonial property order at this time; (

b) T.A.’s income is imputed at $50,000.00 per annum;

(

c) T.A. shall pay $942.00 per month in child support and $311.00 per month in

section 7 expenses; (

d) T.A. shall pay $55.00 per month in spousal support; (

e) The $41,874.42 held in trust by this Court is releasable and shall be paid out of Court in its entirety to S.T., which will satisfy all outstanding support arrears owed by T.A. and contribute to a one-year prospective lump sum child support payment. II. Facts A. Background [ 4 ] The Parties were married in September 2007 in Pakistan. At the time of the marriage, S.T. was a citizen of Pakistan and T.A. was a permanent resident of Canada living in Calgary. They commenced cohabitation on the date of their marriage. Shortly afterwards, T.A. returned to Calgary due to his full-time employment as a taxi-cab driver.

On July 31, 2008, S.T. joined T.A. in Canada, having applied for and received permanent resident status prior to her arrival. [ 5 ] There are three children of marriage: (

a) A.A., born in June 2009 (the “Oldest Child”); (

b) T.A., born in May 2011 (the “Middle Child”); and (

c) N.A., born in March 2013 (the “Youngest Child”). [ 6 ] The Parties separated on January 6, 2014 (the “Date of Separation”). At the time of the separation, S.T. was a stay-at-home mother. She had not been employed since arriving in Canada due to her household and childcare responsibilities.

T.A. was a quality assurance auditor working with Hunting Energy Services (Canada) Ltd. (“Hunting Energy”). [ 7 ] At the commencement of trial, the Parties were negotiating a settlement agreement regarding custody and access, which was incorporated into a Consent Custody and Access Order, dated May 19, 2017 and signed by the Court on June 9, 2017. [ 8 ] T.A. is currently an undischarged bankrupt. He filed for bankruptcy on March 31, 2014, declaring assets of $391,453.00 and liabilities of $410,695.45.

He submits that one half of the debts owed belong to S.T., as they were accumulated during the marriage. [ 9 ] T.A. is in debt to the Maintenance Enforcement Program (“MEP”) in respect of outstanding child and spousal support payments of $29,355.94, as at May 12, 2017 (the “Support Arrears”). In addition, T.A. also owes the sum of $5,936.74, as at January 1, 2017, to the Provincial Treasurer of Alberta. B. Procedural History (

i) Orders Relating to Support and Custody [ 10 ] There are six orders between the Parties that are relevant to this trial. [ 11 ] On June 25, 2014, Jones J. issued an order imputing T.A.’s income at $50,000.00 (the “Jones Order”). Jones J. further ordered that T.A. pay S.T. child support of $942.00 per month and spousal support of $420.00 per month, both commencing on March 31, 2014. [ 12 ] On September 2, 2014, Mahoney J. ordered that T.A. release $4,750.00 from his RBC RRSP to S.T. Designation of this payment as matrimonial property or support would be decided at some later date.

Mahoney J. further ordered $300.00 in costs to S.T., payable forthwith. Subsequently, T.A. paid S.T. $3,924.00 from the proceeds of the RRSP, as well as the $300.00 in costs. [ 13 ] On October 1, 2014, Phillips J. issued a consent interim custody and access order, which granted S.T. interim day-to-day decision-making with respect to the children on a without prejudice basis. It also specified T.A.’s access to the children, both supervised and unsupervised, which was dependent upon continued payment of support obligations.

Phillips J. further confirmed the Jones Order, requiring T.A. to pay child and spousal support totalling $1,342.00 per month. [ 14 ] On February 20, 2015, Horner J. ordered that the issue of access be severed from child support and that a review occur in 90 days to ensure T.A. was meeting his child support obligations. [ 15 ] On June 16, 2015, Wilson J. granted T.A. supervised access to the children (the “Wilson Order”). Wilson J. further required that T.A. provide an opinion from his doctor outlining any ongoing mental health issues. There is no evidence before me that T.A. ever obtained such an opinion.

Wilson J. also specified access to the children and awarded the sum of $500.00 in costs against T.A. Those costs remain outstanding. Previously, when T.A. exercised access to the children after the separation, he was only able to have professional supervised access. T.A. testified at trial that he has not seen the children for one and a half years, nor spoken with them by telephone. [ 16 ] On December 1, 2015, K. Nixon J. addressed T.A.’s support obligations and set the matter over to this trial. [ 17 ] I note that T.A. has never been ordered to pay expenses under

section 7 of the Federal Child Support Guidelines , SOR/97-

175 [ Guidelines ]. However, at trial, S.T. revealed an expense of $250.00 per month, which she pays to transport the Parties’ Middle Child to a special needs school related to language. (ii) Orders Relating to the Funds in Trust [ 18 ] On June 13, 2014, Strekaf J. ordered that $43,749.44 be paid into Court (the “Funds in Trust”).

Those funds remain held in trust and represent the proceeds of sale from the Matrimonial Home, which closed on August 29, 2014. [ 19 ] On November 12, 2014, Romaine J. ordered that the Court pay $1,874.72 out of the Funds in Trust to T.A.’s Trustee in Bankruptcy (the “Trustee”). [ 20 ] At present, the Funds in Trust total $41,874.42. The Trustee has provided a letter stating that these funds are fully releasable. C. T.A.’s Evidence (

i) Marriage and Separation [ 21 ] T.A. is currently 34 years old. He has lived in Canada since 2004, after graduating in Pakistan with what would be equivalent to a Canadian high school diploma. He has taken various training courses since coming to Canada, but has never completed any certificate or post-secondary degree program. [ 22 ] Prior to separation, T.A. enjoyed steady employment with Hunting Energy as a Quality Assurance Auditor.

He was also previously employed as a taxi driver, a cashier and gas attendant with various Mac’s Convenience Stores, an apprentice auto body technician (until his cousin sold the business), as well as operating a junk yard while on paternity leave. [ 23 ] Early in 2014, the Calgary Police Service arrested T.A. on the premises of his then-employer, Hunting Energy. He was charged with assaulting S.T. and uttering threats to harm her and the children. [ 24 ] T.A. testified that his criminal charges were dropped at a Provincial Court hearing once he agreed to enter into a Peace Bond.

The conditions of that Peace Bond included that he have no contact with S.T, who also obtained an Emergency Protection Order against T.A. and gained exclusive possession of the Matrimonial Home. [ 25 ] T.A. admitted that he and S.T. engaged in “high intensity disagreements,” which once resulted in him punching a hole in their bedroom wall.

T.A. denies, however, that he was responsible for two other holes shown in a photo provided by S.T. and entered as an exhibit at trial. [ 26 ] T.A. testified that being arrested at work was very traumatic, as it forced him to explain to his friends and co-workers what had occurred. He returned to work at Hunting Energy after being released on bail, but claims to have suffered depression and mental health issues due to his then-outstanding criminal charges.

As a result, T.A. was prescribed anti-depressants and referred for mental health counselling. (ii) Post-Separation Employment [ 27 ] In May 2014, T.A. was let go by Hunting Energy. He had taken a leave of absence from February to May 2014 to deal with his criminal charges. However, he stated at trial that, upon his return from leave, his mental health prevented him from working full time.

T.A. explained that his doctor told him to relax, but that there was no further leave available to him from Hunting Energy. [ 28 ] The only income that T.A. has earned since May 2014 has been through part-time employment driving a taxi and working as a gas station attendant. When asked why he never resumed full time employment, T.A. testified that he has been unable to work due to preparations for this trial.

Further, T.A. denied that he has secured any post-separation employment or income from any businesses run by his family members. [ 29 ] T.A. was questioned on the websites that he produced as evidence of his post-separation job search. He indicated that, in addition to the ones marked as exhibits, he had also made other applications online that were not included in his evidence. He stated that he applied for 23 or so jobs in 2015, plus other jobs advertised on Kijiji, as well as consulting with Alberta Works.

The evidence that he produced in respect to jobs applied for in 2016 to 2017 indicates that he submitted approximately 10 applications. [ 30 ] T.A. also claims that he was almost hired as a driver with Calgary Transit. He testified that, after meeting the pre-requisites for hiring, he was invited to begin training as a driver. Unfortunately, the City placed a freeze on new hiring before he could begin training. (iii) Relocation to Germany [ 31 ] On May 27, 2016, T.A. moved to Germany to join his fiancée, D.N. (the “Fiancée”), whom he had dated from 2001 to 2006.

He testified that his Fiancée is currently studying law in Germany, as well as caring for her sick mother. T.A. also stated that he only intends to come back to Canada once a year, or as needed. [ 32 ] T.A. currently lives with his Fiancée, who is now expecting a child, and her parents. In cross-examination, he agreed that he does not have any living expenses, as everything is covered by his Fiancée and her parents. [ 33 ] T.A. testified that he has not been able to find employment in Germany.

He claims that he attempted to secure a position as a quality inspector but, without language skills, he has been unable to find work. He is currently registered in German language courses.

(iv) Child and Spousal Support Obligations [ 34 ] T.A. testified that he is willing to pay support based on a minimum wage income of $24,000.00, but that he cannot pay until he gets a job. He also testified that, since the separation, he has made some child and spousal support payments to MEP. MEP’s records indicate the following annual payments, totalling $15,001.20: 2014 - $5,853.42 2015 - $7,332.42 2016 - $1,815.36 2017 - $ nil [ 35 ] When he appeared in court after filing for bankruptcy, T.A. was ordered to pay $250.00 per month to his Trustee towards the amounts owing to his creditors.

He states that he paid the amount ordered for nine months, totalling $2,250.00. In addition, T.A. testified that Canada Revenue Agency withheld refunds owing to him totalling $3,600.00, and forwarded those refunds to MEP to be paid towards the outstanding Support Arrears. [ 36 ] I note that T.A. agreed on cross-examination that S.T. was a full-time homemaker during their marriage. He said, “we both knew our roles in the house.” (

v) Matrimonial Property [ 37 ] T.A. testified that, upon separation, he only received his personal property items from the Matrimonial Home. He seeks to have the remaining household items divided in this trial. [ 38 ] T.A. further requests a judgment for his interest in gold jewellery given to S.T. at the time of their marriage (the “Jewelry”).

He says that the Jewelry has an appraised value of approximately $12,000.00, which was determined in 2012 when the Parties considered selling it to obtain funds for a down payment on the Matrimonial Home. [ 39 ] At the time he filed for bankruptcy, T.A. had credit card debt totalling $71,061.49. He testified that all of the matrimonial debt was declared in his bankruptcy filing. He is now asking for an order that S.T. be responsible for paying half of that amount.

He also stated at trial that he currently has other personal loans owing to his family members, which total approximately $25,000.00. [ 40 ] Subsequent to filing for bankruptcy, T.A. sold a 2000 Chevy Uplander for $3,000.00 and a 2004 Volkswagen Passat for $1,500.00 (together, the “Vehicles”). He claims that he put the funds towards legal fees. He states that he sold the Vehicles for fair market value, but did not produce any evidence of a bill of sale, cheque, or draft received in exchange for the Vehicles.

T.A. agreed in cross-examination that he did not share any of the proceeds from the sale of the Vehicles with S.T. (vi) The Contested Home and Other Property [ 41 ] T.A. cannot be discharged from bankruptcy due to outstanding questions over whether he has a beneficial interest in his brother’s home in Northeast Calgary (the “Contested Home”). At trial, T.A. admitted that he had taken title to the Contested Home in 2009 and registered a mortgage with National Bank in his own name.

T.A. previously lived in the Contested Home with S.T. from 2008 until 2012, after which they purchased the Matrimonial Home. [ 42 ] T.A. denies being a beneficial owner of the Contested Home. He claims that title was only transferred to his name because his brother, also known as T.A. (the “Brother”), had declared bankruptcy. Once his Brother was discharged in 2011, T.A. transferred the Contested Home back into the name of his Brother and his Brother’s wife. The Brother also assumed the mortgage that T.A. had negotiated with National Bank for the Contested Home.

The mortgage was discharged in the spring of 2014. [ 43 ] T.A. denied in cross-examination that he forced S.T. to sign a dower release in order to transfer the Contested Home back to his Brother. He did admit, however, that in 2012 his Brother issued cheques from his company to S.T., which were used when trying to qualify for a mortgage to buy the Matrimonial Home. Subsequently, instead of putting S.T.’s name on the title to the Matrimonial Home, T.A. instead registered it jointly with his Sister. [ 44 ] T.A. stated at trial that he has an entitlement to land that his father owned in Pakistan.

To his knowledge, however, he is not currently a registered owner of those lands. T.A. denied owning any other property in Pakistan. D. S.T.’s Evidence (

i) Marriage and Separation [ 45 ] In 2008, upon arriving in Canada, S.T. testified that she and T.A. lived in the basement of the Contested Home. T.A.’s family, including his Brother, his Brother’s wife, their two children, and his parents, lived on the upper level. S.T. states that T.A.’s family did not treat her well. S.T. and T.A. lived in the Contested Home until moving into the Matrimonial Home in 2012. [ 46 ] S.T. graduated from post-secondary education while she was living in Pakistan.

She testified that she wished to upgrade her education once she arrived in Calgary, but that T.A. and his family would not let her. That is because, once she became pregnant, she was expected to stay home and raise the children.

[ 47 ] At trial, S.T. testified that the Parties separated due to the physical and emotional abuse she suffered at the hands of T.A. She testified that she and T.A. had an altercation on December 20, 2013, just prior to their separation. She produced a photo that shows holes that she alleges T.A. punched in the wall of their bedroom. She further stated that, at that time, T.A. told her he was going out of town to visit his cousin, and that once he returned he expected her and the children to be gone.

T.A. was criminally charged as a result of the altercation. [ 48 ] Following the events of December 20, S.T. and the children moved out of the Matrimonial Home and stayed with S.T.’s family members. S.T. was only able to return to the Matrimonial Home once her lawyer obtained an exclusive possession order on her behalf. (ii) Post-Separation Employment [ 49 ] S.T. has been unable to obtain full-time employment and currently lives on social assistance.

She receives $1,080.00 per month in assistance, plus the Canada Child Benefit of $1,433.00 per month. [ 50 ] S.T. currently resides with her mother and father in Calgary. She testified that she has received financial assistance from her mother, father, and brother. She currently owes them approximately $17,000.00. She states that, once her monthly funds are depleted, she uses her mother’s credit card to obtain necessities for the children.

S.T.’s parents pay her $400.00 per month towards rent, and she purchases groceries for the household. [ 51 ] After the separation, S.T. began taking upgrading courses, such as basic and advanced computer skills, to increase her employment prospects. She also accepted an internship as an administrative assistant with an in-flight catering company in early 2017.

S.T. provided the names of the programs and certificates that she has completed in her efforts to upgrade her education and obtain full- time employment. [ 52 ] S.T. gave evidence that she has applied for 35 to 40 jobs per month since February or March 2015, which is when she completed her education upgrading. So far, S.T. has had three physical interviews and received four telephone responses, but no job offers.

S.T. stated that she believes her lack of success is because she has no Canadian job experience. (iii) Custody and Access Rights [ 53 ] S.T. stated that T.A. exercised his right to access with the children, as per the Wilson Order, until about one and a half years ago. At that point, T.A. cut off access due to the fact that the Oldest Child did not want to visit him. [ 54 ] Since T.A. has moved permanently to Germany, S.T. is requesting that she be granted sole custody of the children. She has no objection to arranging access for T.A. to visit with them when he is able to do so.

She encourages his contact with the children. (iv) Matrimonial Property [ 55 ] S.T. testified that the Parties split their household goods upon separation. She kept the bedroom suites belonging to her and two of the children, as well as one sofa, one table, and the vacuum. T.A. took one table, the dining room suite, a bedroom suite, the computer, a sofa, and the air-conditioner. S.T. believes that there was an equal distribution of household goods. [ 56 ] S.T. also testified that her father gave her the aforementioned Jewelry for her wedding.

Her father sold the Jewellery in 2015 and gave her the proceeds to support herself. She claims that T.A. also gave her one ring and a bracelet as a wedding gift, and T.A.’s mother gave her a bracelet as well. [ 57 ] S.T. testified that she never signed the Consent of Spouse on the National Bank mortgage placed on the Contested Home by T.A. Further, when the Contested Home was transferred back to the Brother, she claims that she was forced to sign a dower release without being provided proper legal advice. E. Other Matters (

i) T.A.’s Bankruptcy [ 58 ] At the beginning of this trial, Mr. Jukes of Miles Davison LLP, on behalf of the Trustee, and Mr. Mahmood of CKM Law, on behalf of the Brother and his wife, appeared before this Court. They made an interim application regarding the Trustee’s action in the bankruptcy proceeding to determine whether T.A. has a beneficial interest in the Contested Home. [ 59 ] The Trustee currently has a caveat registered against title to the Contested Home, alleging that T.A.’s transfer of property to his Brother was a fraudulent preference.

The transfer of title to the Contested Home, from T.A. to his Brother and his wife, was registered in the Land Titles office on June 1, 2011. [ 60 ] S.T. also registered a certificate of lis pendens against the Contested Home, alleging an interest in the property. She did so on March 6, 2014, which is prior to T.A.’s declaration of bankruptcy on March 31, 2014. [ 61 ] Any order given by this Court will be without prejudice to whether S.T. is found to have an interest in the Contested Home. It also depends on the outcome of the Trustee’s application alleging a fraudulent preference.

Should T.A. be found to have a beneficial interest in the Contested Home, then it is likely that his interest will be subject to a claim by S.T. Therefore, this Court has undertaken not to make any order in respect to the Contested Home until a determination is made in the Trustee’s action. [ 62 ] Both Mr. Jukes and Mr. Mahmood confirm that they have no interest in the Funds in Trust. Further, Mr. Jukes advised by

letter, dated May 18, 2017, that the Funds in Trust are releasable by this Court. (ii) The Sister’s Claim [ 63 ] The Sister provided a sworn affidavit, filed on May 23, 2017, indicating an interest in the Matrimonial Home in the amount of $7,492.28. The Sister’s interest allegedly represents funds drawn down on a line of credit that she jointly held with T.A.

She deposed that those funds were taken out of the joint line of credit to fund expenses incurred by T.A. and S.T. for pre-separation household items and family expenses. [ 64 ] Once T.A. defaulted on the joint line of credit, the Sister paid $7,492.28 to Common Collection Agency Inc. (acting as agent on behalf of the Bank of Nova Scotia). The Sister provided evidence of that payment to this Court. III. Issues [ 65 ] The following issues arise from the hearing of this matter: 1. How should the matrimonial property be divided? 2. What is T.A.’s income? 3. What are T.A.’s child support obligations? 4.

Is S.T. entitled to spousal support and, if so, in what amount? 5. Can this Court release the $41,874.42 that is currently held in trust from the sale of the Matrimonial Home and, if so, how should it be distributed? IV. Analysis 1) How should the matrimonial property be divided? [ 66 ] The Parties are seeking an order for the equal distribution of the matrimonial property. T.A., however, is an undischarged bankrupt, and section 30(1) (

d) of the Bankruptcy and Insolvency Act , RSC, 1985, c B-3 [ BIA ], vests a bankrupt’s right to pursue and defend all matrimonial property actions in the trustee in bankruptcy: Tinant v Tinant , 2003 ABCA 211 . Therefore, this Court is unable to grant a matrimonial property order at this time. 2) What is T.A.’s income? A. Overview [ 67 ] On June 25, 2014, Jones J. imputed T.A.’s guideline income at $50,000.00 per annum. On October 1, 2014, Phillips J. confirmed that finding.

Both T.A. and S.T. are now seeking a variation of that amount. [ 68 ] T.A. argues that it would be more appropriate to impute his income as $24,000.00, which is equivalent to minimum wage in Alberta.

In support of that argument, T.A. referred this Court to the decisions in Brown v Barber , 2016 ABQB 687 , Fidler v Fidler , 2012 ABQB 270 , Petrunia v Petrunia , 2012 ABQB 568 , and Weaver v Cahill , 2011 ABQB 121 . [ 69 ] S.T. argues that it would be more appropriate to impute T.A.’s income as somewhere between $65,000.00 and $88,000.00, the equivalent wage of a machinist or machining and tooling inspector, which S.T. submits is similar to T.A.’s last position at Hunting Energy.

In support of that argument, S.T. referred this Court to the decisions in Bercier v Isaac , 2008 ABQB 377 , VLW v JEW , 2007 ABQB 358 , and Mercer v Mercer , 2004 ABQB 551 . [ 70 ] For the reasons outlined below, I find that T.A.’s guideline income is $50,000.00 per annum, effective the Date of Separation. B. Legal Principles for Determining Income [ 71 ] The presumptive rule is that income should be calculated based on the "total income" listed on the payor’s Canada Revenue Agency income tax return. The Parties’ line 150 income for the years 2011 to 2016 inclusive are as follows: T.A.

S.T. 2011 - $57,427.00 2011 - $1,900.00 2012 - $61,125.00 2012 - $2,400.00 2013 - $76,888.00 2013 - $3,300.00 2014 - $10,735.00 2014 - $7,524.00 2015 - $14,506.00 2015 - $5,160.00 2016 - $11,881.79 2016 - $8,001.00

[ 72 ] T.A.’s line 150 income for the 2013 year includes RRSP proceeds of $12,211.00. [ 73 ] This Court has the discretion to diverge from the presumptive rule under certain circumstances. Based on the present facts, the most relevant circumstances are outlined in section 19(1) (

a) of the Guidelines : 19(1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following: (

a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse .... [ 74 ] Section 19(1)(

a) was interpreted by the Court of Appeal in Hunt v Smolis-Hunt , 2001 ABCA 229 at para 42 , wherein the majority stated that section 19(1) (a): ... should be interpreted to impute income where the obligor has pursued a deliberate course of conduct for the purpose of evading child support obligations. We read the

section as requiring either proof of a specific intention to undermine or avoid support obligations, or circumstances which permit the court to infer that the intention of the obligor is to undermine or avoid his or her support obligations. [ 75 ] T.A. argues that he did not have the specific intention of undermining or avoiding his support obligations. S.T. argues that such an intention can be inferred from the present circumstances. [ 76 ] When precisely such an inference is appropriate has been somewhat controversial in Alberta.

However, the application of the Smolis-Hunt principle in JEW is instructive in this instance. In JEW at para 33 , Kenny J. observes, in reference to the reasoning in Mercer , that an inference may be appropriate when a payor consciously makes a decision that will logically have an adverse effect on support obligations. C. Determining T.A.’s Income (

i) T.A.’s Employment Situation [ 77 ] From 2007, when the parties married, until 2014, when the parties separated, T.A. held several different jobs. Those jobs were in different fields, and provided different levels of compensation. Yet T.A. consistently maintained full-time employment throughout that period.

That consistency ended almost immediately upon his separation from S.T., at which point T.A. left his long-time employment at Hunting Energy. [ 78 ] Since leaving Hunting Energy, T.A. has bounced between multiple jobs, started and then abandoned re-training efforts, and has now moved to Germany and completely withdrawn from employment.

As a result, whereas T.A. reported income of between $57,427.00 and $76,888.00 per annum from 2011 to 2013, he has claimed an income no greater than $14,506.00 per annum in the years since separation. [ 79 ] At trial, T.A. provided several explanations to justify his post-separation under-employment.

Some of those explanations include: difficulty finding a job due to Alberta’s economic downturn; his ongoing struggle with depression; the need to focus all of his efforts on his outstanding legal matters; his relocation to Germany; and the demands of his ongoing German language training. [ 80 ] Although the economic downturn has considerably affected Alberta’s job market, T.A.’s explanations do not otherwise justify what I find to be his conscious decision to remain under-employed. [ 81 ] I accept that T.A. suffered from some manner of emotional distress following the separation, but he has provided no valid medical evidence to support the claim that his post-separation depression has prevented him from maintaining full-time employment.

Further, T.A. has provided no valid justification for why the preparation for his various criminal and civil proceedings prevented him from maintaining full-time employment. I also do not accept T.A.’s explanation that he is currently unable to maintain any kind of part- time employment in Germany because he is taking German language classes.

Those classes account for only four hours per day of class time, not including homework, five days per week. [ 82 ] In Rensonnet v Uttl , 2016 ABCA 196 at paras 44-46 , the Court of Appeal affirmed that, without an otherwise valid explanation, abandoning employment to prepare for litigation, or to fulfill part-time weekly obligations, constitute circumstances where this Court may infer an intention to undermine or avoid support obligations.

The present facts are not precisely analogous to those in Uttl , but the basic principles outlined by the Court of Appeal apply. [ 83 ] I find that T.A. has made the conscious decision to remain under-employed since the separation. A negative inference is supported by T.A.’s lack of a valid explanation for his long-term under-employment.

The absence of a valid explanation is further compounded by the fact that T.A. still owes Support Arrears of $29,355.94, yet has submitted only a minimal number of job applications since 2015. (ii) S.T.’s Position [ 84 ] S.T. argues that T.A.’s income should be imputed based on the wage of a machinist or machining and tool inspector.

S.T. submits that those positions are equivalent to the highest paying position that T.A. held at his last pre-separation employer, Hunting Energy. [ 85 ] There is some disagreement, however, as to whether T.A. ever worked in a position equivalent to a machinist or machining and tooling inspector. Further, the Court of Appeal in Smolis-Hunt at para 64 rejected the proposition that a payor should be required to

work at the maximum of his or her earning capacity. I find that it would be unfair to impute T.A.’s income at a level equivalent to the highest position he has ever held. D. Conclusion [ 86 ] T.A. does not have an obligation to find employment that maximizes his income earning capacity, but he does have an obligation to support his children. T.A.’s post-separation under-employment has prevented him from fulfilling his support obligations.

Aware that he was failing to fulfill those obligations, T.A. also made the conscious decision to move to Germany, stop working all together, and ignore the ongoing needs of his children. To paraphrase the Court of Appeal in Uttl at para 46 , T.A.’s choice to move to Germany and completely withdraw from employment is not an acceptable decision by a parent. [ 87 ] Since the separation, T.A. has had the capacity to earn far more than a minimum wage-level income.

He has made the conscious decision not to work to his full earning capacity, but it would be inappropriate to impute his income at the highest possible limit of that capacity. Therefore, I impute T.A.’s income at $50,000.00 per annum, effective the Date of Separation. 3) What are T.A.’s child support obligations? A. Overview [ 88 ] In June 2014, T.A. was ordered to pay $942.00 per month in child support to S.T., commencing on March 31, 2014. That order was based on T.A.’s imputed guideline income of $50,000.00 per annum.

As of May 12, 2017, T.A. owes Support Arrears totalling $29,355.94 to MEP for outstanding child and spousal support obligations. [ 89 ] T.A. argues that his child support obligations should be reduced to reflect an imputed income of $24,000.00. [ 90 ] S.T. argues that an order should be made requiring T.A. to reimburse her for any reasonable out-of-pocket expenses falling under

section 7 of the Guidelines . [ 91 ] For the reasons outlined below, I find that T.A.’s

section 3 child support obligations are $942.00 per month, effective the Date of the Separation. Further, T.A. is now obliged to pay an additional $311.00 per month in

section 7 expenses, effective July 1, 2017. This amounts to a total overall child support payment of $1,253.00 per month going forward. T.A. shall also reimburse S.T. for 87 percent of any health-related expenses, as defined in section 7(1) (

c) of the Guidelines . B. Legal Principles for Determining Child Support Obligations [ 92 ] One of the guiding principles of child support is that children have a right to expect a level of support that is commensurate with their parents’ earning capacity: Pinter v Pinter , 2016 ABCA 58 at para 19 . In ensuring that principle is met, this Court has the power to revisit and adjust the amount of child support awarded as part of any previous interim order: Durocher v Klementovich , 2013 ABCA 115 at para 20 . [ 93 ] Base child support obligations are calculated under

section 3 of the Guidelines . This Court may also order the payment or reimbursement of special or extraordinary expenses under

section 7 of the Guidelines . In making such an order, this Court must consider the necessity and reasonableness of those expenses as they relate to the best interests of the child, the means of the parties, and the parties’ pre-separation standard of living: T (CJ) v T (GA) , 2012 ABQB 193 at paras 48-49 . C. Determination of Child Support Obligations (

i) Reduction of the Support Arrears [ 94 ] T.A. argues that his outstanding Support Arrears should be reduced to reflect a lower monthly obligation. In support of that argument, T.A. directs this Court to Fidler at para 24 , wherein Gates J., quoting the Court of Appeal in Haisman v Haisman , 1994 ABCA 249 , outlines the test for reducing or cancelling child support arrears: ...

In short, in the absence of some special circumstance, a judge should not vary or rescind an order for the payment of child support so as to reduce or eliminate arrears unless he or she is satisfied on a balance of probabilities that the former spouse or judgment debtor cannot then pay, and will not at any time in the future be able to pay, the arrears. [ 95 ] Therefore, to reduce or cancel the Support Arrears, T.A. must establish a past and future inability to pay. [ 96 ] I find that T.A. has not established a true inability to pay.

Any such claimed inability is largely the result of his conscious decision to remain under-employed, and now unemployed, since the separation. Accordingly, I decline to reduce or eliminate the Support Arrears. (ii)

Section 3 Obligations [ 97 ] T.A. argues that his child support obligations should be reduced going forward to reflect an imputed income of $24,000.00. As I have already found that T.A.’s income should be imputed at $50,000.00 per annum, I decline to reduce T.A.’s

section 3 child support obligations.

[98] I find that T.A.’s

section 3 child support obligations should be set at $942.00 per month, effective from the Date ofSeparation. (iii)

Section 7 Expenses [99] S.T. did not provide evidence of any extracurricular activities in which the children are currently enrolled. Rather, she askspermission to enroll the children in activities costing up to $150.00 per month. Further, S.T. requests that T.A. be ordered to reimburseher in full for any reasonable out-of-pocket medical or dental expenses incurred for the children. I also note that S.T. currently pays$250.00 per month, 10 months per year, in relation to transportation for the Parties’ Middle Child to a special needs school. [100] I find that all of the above expenses are legitimate

section 7 expenses, totalling $4,300.00 per annum. A fair apportionment ofthose expenses, based on the Parties’ incomes and accounting for spousal support (as calculated below), is 87 percent to T.A. and 13percent to S.T: T (GA) at paras 49, 80. [101] Accordingly, T.A. shall pay $311.00 per month in

section 7 expenses, effective July 1, 2017. Further, T.A. shall also reimburseS.T. for 87 percent of any health-related expenses, as defined in section 7(1)(

c) of the Guidelines. D. Conclusion [102] From the Date of Separation to the release of this decision in June 2017, T.A. was obliged to pay S.T. $942.00 per month insection 3 child support. Commencing July 1, 2017, T.A. shall pay $1,253.00 per month in combined

section 3 and

section 7 childsupport. T.A. shall also reimburse S.T. for 87 percent of any health-related expenses, as defined in section 7(1)(

c) of the Guidelines. 4) Is S.T. entitled to spousal support and, if so, in what amount? A. Overview [103] In June 2014, T.A. was ordered to pay $420.00 per month in spousal support to S.T., commencing on March 31, 2014. Thatorder was based on T.A.’s imputed guideline income of $50,000.00 per annum. [104] T.A. argues that his monthly spousal support obligation was improperly calculated at the time of the Jones Order. T.A. claimsthat, in conjunction with his monthly child support obligation of $942.00, a guideline income of $50,000.00 does not call for anypayment of spousal support.

Further, T.A. seeks a reduction of his past and future spousal support on the grounds of financial hardship. [105] For the reasons outlined below, I find that S.T. is entitled to spousal support of $55.00 per month, effective from the Date ofSeparation. B. Legal Principles for Determining Spousal Support Obligations [106]

Section 15.3(1) of the Divorce Act, RSC 1985, c 3 (2nd Supp), requires that this Court give priority to considerations of childsupport over those of spousal support.

Section 15.2 of the Divorce Act provides the statutory basis for granting spousal support orders. InMoge v Moge, (SCC), [1992] 3 SCR 813 at 852, 866, the Supreme Court made clear that this Court must take intoaccount all of the objectives outlined in

section 15.2 of the Divorce Act, and that none of those objectives is paramount. Once entitlementis established, the objectives and factors found in the Divorce Act are relevant in determining duration and quantum. C. Determination of Spousal Support Obligations (

i) Entitlement [107] At trial, T.A. conceded that S.T. is entitled to spousal support, and focussed his argument only on the appropriate quantum.Nevertheless, I will still briefly address entitlement. [108] There are three categories of entitlement: (1) compensatory; (2) non-compensatory; and (3) contractual: Bracklow v Bracklow, (SCC), [1999] 1 SCR 420 at para 15. I find that S.T. has established an entitlement to both compensatory and non-compensatory spousal support. Contractual entitlement is not relevant in the present circumstances. [109] S.T. and T.A. were married for more than six years.

S.T. left Pakistan to join T.A. in Canada. She did not work outside thehome in paid employment for the duration of the marriage. She also abandoned further post-secondary education in order to take onprimary responsibility for the household and raising the Parties’ three children. T.A. stated during questioning that he wanted S.T. to findemployment during their marriage, and even encouraged her job search, yet S.T. obviously never found employment. [110] Post-separation, S.T. now finds herself economically uncompetitive and without valid qualifications.

She has yet to secure full-time employment, despite significant post-separation efforts to retrain and upgrade her education. She can therefore demonstrate a claimfor compensatory spousal support arising out of the marriage and its breakdown: H (JL) v W (RS), 2017 ABCA 98 at para 19. [111] S.T. is also entitled to non-compensatory needs-based support, as she and her children currently survive on a combination ofsocial assistance and financial support from S.T.’s family.

(ii) Duration [ 112 ] Based on the current circumstances, the Spousal Support Advisory Guidelines [ SSAG ] suggest that the “age-of-children test for duration” is appropriate. The SSAG is not binding: Sawatzky v Sawatzky , 2008 ABCA 355 at paras 16-17 . However, I must still take into consideration that S.T. is a mother with no employment history and three young children in her care. Further, one of those children has special educational needs. [ 113 ] I find that spousal support should continue until the Parties’ Youngest Child has graduated from high school.

The duration of spousal support shall be reviewable based on any relevant change in circumstances. (iii) Quantum [ 114 ] Based on the arguments made by the Parties at trial, the amount of spousal support awarded is subject to two issues: (1) whether the interim award of $420.00 per month was appropriate; and, if it was appropriate, (2) whether T.A.’s claimed financial hardship justifies a reduction in his monthly obligation. [ 115 ] In regards to the first issue, T.A. argues that, after accounting for child support, his imputed income of $50,000.00 per annum dictates that he should not have to pay any additional spousal support. [ 116 ] Considering the ranges provided by the SSAG , I accept that $420.00 per month was not an appropriate award.

Based on T.A.’s imputed income, and S.T.’s social assistance income, the SSAG suggests a range of annual spousal support between $0.00 and $109.00 per month. The mid-range spousal support is $55.00 per month. [ 117 ] I find that $55.00 per month is an appropriate spousal support award. Although S.T is entitled to support, T.A has minimal ability to pay more than $55.00 per month. As a result, T.A.’s obligation is reduced to $55.00 per month, effective the Date of Separation.

The amount of spousal support shall be reviewable based on any relevant change in circumstances, including any increase in T.A.’s income. [ 118 ] The second issue, T.A.’s request to reduce spousal support due to financial hardship, is moot due to my finding on the first issue. D. Conclusion [ 119 ] I find that S.T. is entitled to spousal support on both a compensatory and non-compensatory basis until the Parties’ Youngest Child has graduated from high school.

T.A.’s imputed income of $50,000.00 per annum, when combined with his child support obligations, justifies an award of only $55.00 per month, effective the Date of Separation. The amount and duration of spousal support shall be reviewable based on any relevant change in circumstances, including any increase in T.A.’s income. 5) Can this Court release the $41,874.42 that is currently held in trust from the sale of the Matrimonial Home and, if so, how should those funds be distributed? A. Overview [ 120 ] The Funds in Trust currently total $41,874.42. The Sister claims $7,492.28 of those funds.

For the reasons below, I find that the Funds in Trust are releasable and should be paid out of Court to: (1) satisfy the outstanding Support Arrears, and (2) contribute to a prospective lump sum equivalent to one year of child support. Further, I decline to find that the Sister has any interest in the Funds in Trust. [ 121 ] The release of the Funds in Trust is suspended pending the expiry of any appeal period stemming from this Judgment. B.

Relevant Legal Principles [ 122 ] In the normal course of bankruptcy, there is an automatic stay of proceedings that prevents creditors from commencing or continuing proceedings against the debtor. That stay does not apply to secured creditors, who remain free to enforce their security interest against the collateral. It also does not apply to family support claims under

section 69.41(1) of the BIA . Although, under

section 69.41(2) of the BIA , a support claimant is limited to making his or her claim against property that has not vested in the trustee. [ 123 ] The importance of

section 69.41 is that it enables a support claimant to enforce their claim against exempt property that ordinarily is not available to creditors, including exempt funds from the sale of a matrimonial home: Mundle v Mundle , 2011 ABCA 330 ; Stanley v Stanley , 2015 ABQB 773 . [ 124 ] I once again note that Mr. Jukes, on behalf of the Trustee, has informed this Court that the Funds in Trust represent exempt funds that are fully releasable. I also note that, pursuant to section 178(1) of the BIA , an order of discharge does not release the bankrupt from family support obligations. C. Determination Regarding the Funds in Trust

(

i) Entitlement of the Sister to the Funds in Trust [ 125 ] The Sister has submitted an affidavit to this Court claiming an entitlement to $7,492.28 from the Funds in Trust as a pre- bankruptcy creditor of T.A. Any claim by the Sister regarding debts owed to her by T.A. should have been directed to the Trustee. I decline to find that she has any interest in the Funds in Trust going forward. (ii) Payment of the Support Arrears from the Funds in Trust [ 126 ] The recalculation of T.A.’s child and spousal support obligations reduces the Support Arrears from $29,355.94 to $26,872.80.

That recalculation is based on child support obligations of $942.00 per month over the previous 42 months (from the Date of Separation to June 30, 2017), combined with spousal support obligations of $55.00 per month over the same period, and also accounting for T.A.’s previous payments to MEP totalling $15,001.20. [ 127 ] The reduction of the Support Arrears does not alter T.A.’s post-separation under-employment and financial situation.

He has demonstrated a past unwillingness and inability to pay the Support Arrears and, without any kind of current employment, will likely remain unwilling and unable to make periodic payments going forward. [ 128 ] I find that T.A.’s outstanding Support Arrears are to be satisfied upon payment to S.T. of $26,872.80 from the Funds in Trust, which is subject to the expiry of any appeal period stemming from this Judgment. Once that payment is made, I direct MEP to bring T.A.’s account to $0.00, as at June 30, 2017.

Any future arrears shall continue to accrue to T.A.’s MEP account subsequent to that date. (iii) Payment of a Prospective Lump Sum from the Funds in Trust [ 129 ]

Section 11 of the Guidelines allows this Court to award a prospective lump sum for child support: Smolis-Hunt at paras 38, 137-147 . Such an award is appropriate where the court believes that it is in the best interest of the child, that support payments may not otherwise be made by the payor, and when it does not unduly prejudice the payor: Deans v Deans , 2010 ABQB 17 at para 13 . [ 130 ] I note that T.A. has a poor record of fulfilling his child support obligations, which includes a failure to make any kind of payment in 2017.

His record, combined with S.T.’s poor financial situation and the resultant effect on the Parties’ three children, compels me to act in the best interests of the children. [ 131 ] By virtue of T.A.’s failure to fulfill his support obligations, his ongoing lack of employment, and his indeterminate timeline for financial improvement, I award a prospective lump sum child support payment of $15,001.62, which almost fully covers child support payments from July 1, 2017 until June 30, 2018. That lump sum is to be paid to S.T. from the Funds in Trust following the expiry of any appeal period stemming from this Judgment.

T.A. owes the remainder of the lump sum payment, totalling $34.38, on June 1, 2018. [ 132 ] I note that T.A. will not be unduly prejudiced by such a lump sum award. After all, he stated during questioning that all of his expenses are currently covered by his Fiancée and her family. Furthermore, the prospective lump sum, which is in satisfaction of his child support obligations for the coming year, will provide T.A. with the time necessary to finalize his German language training and obtain a level of employment that is commensurate with his earning capacity.

He can then resume his monthly child support payments to S.T., beginning on July 1, 2018. D. Conclusion [ 133 ] I find that the Funds in Trust, totalling $41,874.42, are releasable in their entirety to S.T. The first $26,872.80 shall be allocated to satisfy the Support Arrears, which will bring T.A.’s MEP account to $0.00, as at June 30, 2017. The remainder, totalling $15,001.62, shall be allocated as a one-year prospective lump sum of child support, encompassing obligations owed from July 1, 2017 to June 30, 2018.

T.A. shall pay the remaining balance of the lump sum, totalling $34.38, on June 1, 2018. [ 134 ] All payments out of Court from the Funds in Trust are suspended pending the expiry of any appeal period stemming from this Judgment. V.

Summary [ 135 ] This Court finds that the Parties are entitled to a Judgment of Divorce pending the submission of the necessary desk divorce documents to the Court. [ 136 ] This Court further orders that: (

a) T.A.’s income shall be imputed at $50,000.00, effective January 6, 2014. (

b) The Funds in Trust, currently totalling $41,874.42, are fully releasable to S.T. (

c) T.A.’s outstanding Support Arrears shall be adjusted to $26,872.80 and paid to S.T. in full out of the Funds in Trust. Following that payment, T.A.’s account with MEP shall be adjusted to $0.00, and shall be subject to any new arrears incurred from July 1, 2017 onwards.

(

d) T.A. shall pay to S.T. a prospective lump sum payment of $15,036.00, which covers child support obligations owing from July 1, 2017 until June 1, 2018. Of that lump sum, $15,001.62 shall be paid out of the Funds in Trust and $34.38 shall be paid by T.A. on June 1, 2018. (

e) All payments out of Court from the Funds in Trust shall be suspended subject to the expiry of any appeal period stemming from this Judgment. (

f) T.A. shall pay child support of $1,253.00 per month starting on July 1, 2018. Periodic payments are suspended from July 1, 2017 until June 30, 2018 due to the one-year prospective lump sum child support payment. (

g) T.A. shall reimburse S.T. for 87 percent of any health-related expenses, as defined in section 7(1) (

c) of the Guidelines , effective July 1, 2017. (

h) T.A. shall pay spousal support of $55.00 per month starting on July 1, 2017. S.T. is entitled to spousal support until the Parties’ Youngest Child has graduated from high school. The amount and duration of spousal support shall be reviewable based on any relevant change in circumstances, including an increase in T.A.’s income. (

i) T.A. shall notify S.T. in writing within 30 days of obtaining employment that pays more than $50,000.00 per annum. (

j) Each of the Parties shall annually provide the other with a complete copy of their income tax return, as well as any notices of assessment or reassessment, issued by the Canada Revenue Agency or any other foreign equivalent body, on or before June 30 of each year. In the event that either of the Parties fails to file an income tax return for the previous year, they shall provide the other with copies of their T4 and/or T4A, or foreign equivalent, as well as any other relevant tax documents disclosing all sources of income, including self-employment income. VI. Costs [ 137 ] S.T. is entitled to costs under Column 1 of

Schedule C. Heard on the 15 th , 16 th , 17 th , 18 th and 19 th days of May, 2017. Dated at the City of Calgary, Alberta this 30 th day of June, 2017. S.L. Hunt McDonald J.C.Q.B.A. Appearances: Delalu, A. for the Plaintiff, T.A. Azim, A. for the Defendant, S.T.

Jukes, D. for an interested party, Barry Nykyforuk & Associates Inc. (the “Trustee”). Mahmood, U. for an interested party, T.A. (the “Brother”).