Goddard v. Stewart, 2013 BCSC 2289

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Goddard v. Stewart, 2013 BCSC 2289 Date: 20131212 Docket: 12-4186 Registry: Victoria Between: Alana Lauren Beckwith Goddard Claimant And: David Stephen Stewart Respondent Before: Master Bouck Reasons for Judgment Counsel for the Claimant/Applicant: C. Murray Respondent appearing in person: D.S. Stewart Place and Date of Hearing: Victoria, B.C. November 20, 2013 Place and Date of Judgment: Victoria, B.C.

December 12, 2013 Introduction [ 1 ] The parties are unable to agree as to what child-related expenses ought to be considered “extraordinary” pursuant to s. 7 of the Federal Child Support Guidelines (the “ Guidelines ”). The claimant asks for an order defining those expenses and the respondent’s corresponding financial contribution. [ 2 ] In addition, despite an order in place which addresses the calculation of child support to be paid by the respondent, the claimant asks the court to fix a specific monthly sum to be paid pursuant to s. 3 of the Guidelines.

The claimant also seeks an order for payment of retroactive support once that amount is fixed. [ 3 ] While not specifically stated in the notice of application, the claimant can only be seeking interim orders on these matters. Background Facts [ 4 ] The parties were married in 2003 and separated in March 2012. They are the parents of two young children: Tyler James Stewart, born 23 August 2005 (“Tyler”); and Pearl Melissa Stewart, born 2 October 2009 (“Pearl”). [ 5 ] On March 18, 2013, the parties entered into consent order on the following terms: 1.

By consent, child support be paid by the Respondent to the Claimant, pursuant to the Federal Child Support Guidelines, with respect to the two children of the marriage, namely Tyler James Stewart, born 23 August 2005 and Pearl Melissa Stewart born 02 October 2009, on the first day of each month commencing January 1, 2013. The Claimant is at liberty to seek retroactive child support from the Respondent for the period from the date of separation to December 31, 2012. 2.

By consent, the parties share special and extraordinary expenses, pursuant to the provisions of the Federal Child Support Guidelines, as agreed, in proportion to their Guideline incomes which are yet to be determined. 3.

By consent, the parties will exchange copies of their complete filed income tax returns with all T slips and attachments and their notices of assessment and or notices of reassessment from Canada Revenue Agency on or before the 30 th day of May of each and every calendar year commencing on May 30th, 2013 and child support shall be adjusted, and the parties' proportionate share of the special and extraordinary expenses shall be adjusted, and be based upon the parties' line 150 incomes for the previous year (which shall be the parties’ respective guideline incomes unless otherwise ordered or agreed) and to accord with the Federal Child Support Guidelines, effective the 1st day of July each and every calendar year, commencing with July 1 st of 2013 and continuing for as long as the children

continue to be defined as a child of the marriage under the Divorce Act and the Family Law Act. (the “JCC order”.) [ 6 ] The JCC order does not state whether the terms are intended to be interim or final, but the language used contemplates at least some future adjudication on retroactive support and possibly income determination. [ 7 ] The parties’ next involvement with the judicial process was an appearance before me on July 11, 2013. [ 8 ] While the question of the children’s primary residence and the parties’ respective parenting time were argued that day, there was consensus reached on other important parenting matters.

The parties consented to an order for joint custody and guardianship of the children.

They also agreed to an order that: When exercising parental responsibilities both guardians must consult about any important decisions that must be made and try to reach agreement concerning these important decisions, but if the parties cannot come to agreement, the Claimant will have the ability to make a decision and the Respondent may apply to the court to review the decision of the Claimant. [ 9 ] The parties agreed to employ divorce coaches and involve a child specialist, although the latter is not to prepare any formal report for litigation purposes. [ 10 ] The respondent further agreed to pay retroactive child support for the months of September through December 2012 in the sum of $3,760.

To my recollection, and I may be mistaken, the issue of any outstanding child support for 2013 was not raised on that application. [ 11 ] On July 19, 2013, I made certain orders with respect the contested parenting issues. My reasons for granting those orders were given orally and are unreported. In those reasons, I briefly touched upon the parties’ financial circumstances. The evidence presented on that application suggested that both parties were essentially insolvent. [ 12 ] At that time, the former family home was subject to foreclosure proceedings.

The property has now been sold resulting in a shortfall of the monies owing to the mortgagee. In or about June 2013, the parties consented to judgment in favour of the mortgagee in the sum of $47,843.17. The parties are jointly and severally liable for that debt. [ 13 ] The respondent reports an annual income of $56,929.44 with expenses of $57,114.96. Mr. Stewart lives with his parents and pays $545 in rent and related accommodation expenses. The children are parented by Mr. Stewart in that home. Ms.

Goddard has expressed concerns over the suitability of this accommodation for the children, particularly for overnight parenting time. Mr. Stewart would like to find other accommodation but his housing expense will in all probability increase significantly. He anticipates rental costs of $1,500 per month for a two bedroom apartment. [ 14 ] Ms. Goddard’s financial statement is dated, having been sworn almost one year ago. In that statement, Ms. Goddard reports an annual income of $54, 025 and expenses of $63,242.16. The child support received from Mr. Stewart is not included in the income reported.

The monthly expenses reported include one-half of Tyler’s school tuition ($205) and $75 for the children’s activities and lessons. [ 15 ] There is also consumer debt owed by both parties and other debts which may or may not be “family” debt. All told, the parties’ financial statements disclose liabilities in excess of $86,000 and assets valued at about $14,000. [ 16 ] Tyler is enrolled in an independent Catholic school. At the time of this enrollment (which was prior to separation), the parties agreed to make financial sacrifices so that Tyler could attend the school.

There are various reasons given by the parties for enrolling Tyler at this school, including its proximity to the former family home, the perceived superiority to the public school system in terms of academics and extracurricular activities, and the claimant’s experience in the independent school system. Tyler attended kindergarten and began grade one (albeit briefly) in the public school system. [ 17 ] The younger child, Pearl, is presently in a day care/pre-school setting but will be kindergarten age by September 2014. The claimant wishes to enrol Pearl at the same independent school.

Accordingly, the claimant seeks an order that the respondent contribute proportionately to this prospective expense. [ 18 ] The children’s enrollment at the independent school has become a thorny issue between the parties. The respondent says that the parties can no longer afford this tuition cost for either of the children. The respondent also takes issue with some of the religious instruction at the school.

The claimant says that the children’s best interests are served by their attendance at this school and the parties simply need to do more financial belt-tightening to meet the tuition costs. [ 19 ] In addition to the independent school tuition, the claimant seeks a contribution from the respondent for various other expenses related to the children, including swimming, golf and dance lessons, seasonal out of school camps and registration fees for soccer and baseball. [ 20 ] The respondent denies that these expenses ought to be considered extraordinary.

Further, the respondent says no order is required as he is already contributing to the cost of daycare and out of school camps which are made necessary by the parties’ work schedules. [ 21 ] The respondent denies that any arrears of support are owed. Rather, the respondent says that he has overpaid child support. [ 22 ] Finally, the respondent questions the need for this further judicial involvement given the existing interim orders and the use of divorce coaches (albeit the latter has been more difficult to organize than the parties had hoped).

[ 23 ] There is no trial date set in the proceeding. Discussion A. Fixing the child support to be paid and Arrears of support [ 24 ] In July 2013, Mr. Stewart acknowledged that arrears of child support for 2012 owed. Those arrears have now been paid, at least according to the respondent. [ 25 ] One of the reasons for the accumulation of arrears in 2012 was a difference in opinion on how the support ought to be determined. [ 26 ] Despite the best intentions of the parties, the calculation of child support under the JCC order has become a source of friction.

Any step that might reduce the friction between these parties is in the best interests of the two young children. [ 27 ] The JCC order provides a reasonable mechanism for the parties to reach agreement on child support. Under the terms of that order, the respondent ought to pay child support from June 1, 2013 onwards based on his notice of assessment or reassessment for the 2012 taxation year. [ 28 ] As I read the JCC order, Mr.

Stewart’s child support payment for 2013 is $919 per month until the adjustment occurs in May 2014. [ 29 ] In order to reduce the ongoing conflict, I will order that the child support to be paid from January 1, 2013 to June 1, 2014 is $919 each month, payable on the 1 st of each month unless the parties otherwise agree. There is no justification to depart otherwise from the terms of the JCC order. [ 30 ] Any question of arrears or overpayment of support depends on the

interpretation of the JCC order as well as a more certain determination of the respondent’s income in the interim period. Those matters ought to be left to the trial judge. Accordingly, the relief sought in paragraph 3 of the notice of application is adjourned to trial. B. Extraordinary Expenses [ 31 ] The claimant submits that the choice of the children’s school and enrollment in other activities is not really up for debate.

Under the terms of the July 11 th consent order, the claimant is entitled to make those choices (when there is an impasse) with liberty to the respondent to bring an application to have the court order otherwise. Mr. Stewart has not brought such an application. [ 32 ] The claimant might be entitled to make the unilateral decision to enrol the children in the independent school system and in various lessons and activities. However, in doing so, the expense does not automatically become extraordinary and thus requiring a contribution from the respondent.

The JCC order specifically provides that the parties agree to the extraordinary and special expenses to be shared. An order that the respondent contribute to these kinds of expenses is a discretionary remedy. [ 33 ] The respondent’s refusal to contribute to the children’s extraordinary expenses was raised by the claimant in her May 2013 affidavit. The claimant deposes that the respondent has the ability to contribute to the extraordinary expenses because he had no housing costs.

The respondent was then living in the former family home but neither party was paying the mortgage registered on title to that home. [ 34 ] By the summer of 2013, the parties had lost this asset and acquired a debt of nearly $48,000. The evidence does not address whether execution proceedings are being taken but the judgment remains an enforceable order of the court. The claimant does not address how that judgment is to be paid. As noted, there is various other debt that must be addressed by the parties in one way or another. [ 35 ] In L.H.M.K. v.

B.P.K., 2012 BCSC 435 , the court nicely summarizes the law applicable to this aspect of the claimant’s application: V. Extraordinary and special (s. 7 Guidelines ) expenses A. Legal principles [94] Section 7(1) of the Guidelines provides the following: 7.

(1) In a child support order the court may, on either spouse’s request, provide for an amount to cover all or any portion of the following expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child’s best interests and the reasonableness of the expense in relation to the means of the spouses and those of the child and to the family’s spending pattern prior to the separation: (

a) child care expenses incurred as a result of the custodial parent’s employment, illness, disability or education or training for employment; (

b) that portion of the medical and dental insurance premiums attributable to the child; (

c) health-related expenses that exceed insurance reimbursement by at least $100 annually, including orthodontic treatment, professional counselling provided by a psychologist, social worker, psychiatrist or any other person, physiotherapy, occupational therapy, speech therapy and prescription drugs, hearing aids, glasses and contact lenses;

(

d) extraordinary expenses for primary or secondary school education or for any other educational programs that meet the child’sparticular needs; (

e) expenses for post-secondary education; and (

f) extraordinary expenses for extracurricular activities. [95] Parliament subsequently added s. 7(1.1) to clarify “extraordinary expenses”:

(1.1) For the purposes of paragraphs (1)(

d) and (f), the term “extraordinary expenses” means (

a) expenses that exceed those that the spouse requesting an amount for the extraordinary expenses can reasonably cover, taking intoaccount that spouse’s income and the amount that the spouse would receive under the applicable table or, where the court has determinedthat the table amount is inappropriate, the amount that the court has otherwise determined is appropriate; or (

b) where paragraph (

a) is not applicable, expenses that the court considers are extraordinary taking into account (

i) the amount of the expense in relation to the income of the spouse requesting the amount, including the amount that the spouse wouldreceive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court hasotherwise determined is appropriate, (ii) the nature and number of the educational programs and extracurricular activities, (iii) any special needs and talents of the child or children, (iv) the overall cost of the programs and activities, and (

v) any other similar factor that the court considers relevant. [96] The approach to assessing extraordinary and special expenses was reviewed by Chamberlist J. in Piper v.

Piper, 2010 BCSC1718, at para. 92-93: [92] In a very early decision dealing with the Guidelines and extraordinary expenses, our Court of Appeal, in McLaughlin v.McLaughlin, (1998), (BC CA), 167 D.L.R. (4th) 39, 57 B.C.L.R. (3d) 186 (B.C.C.A.), considered the meaning of“extraordinary” and set out a two-stage enquiry for the court to undertake when considering whether to award an amount under s. 7.Prowse J.A. said this at paras. 81-82: [81] In the result, I conclude that, in deciding whether an expense, or the totality of expenses claimed on behalf of children under s.7(1)(

f) are extraordinary, the court should take into consideration the combined income of the parties, as well as the nature and amountof the individual expense, the nature and number of the activities, any special needs or talents of the children, and the overall cost of theactivities. This list is not intended to be exhaustive, as considerations may arise in other cases which may also be relevant. I note that inthe only other decision of this Court dealing with s. 7(1)(f), Cochrane v.

Zarins, (1998), (BC CA), 36 R.F.L. (4th)434, the Court concluded that a particular child's talents are a relevant factor in determining whether an expense for an extracurricularactivity is extraordinary. [82] As earlier stated, once an expense or expenses are found to be extraordinary it is necessary for the court to proceed to determinewhether the expenses are necessary in relation to the children's best interests and reasonable, having regard to the means of the spousesand those of the child, and to the family's spending pattern prior to separation.

There appears to be a consensus in the authorities dealingwith s. 7(1)(

f) that those questions do not need to be addressed until the expense or expenses in question have been found to beextraordinary. That would also be true of "extraordinary" educational expenses under s. 7(1)(d). With respect to the other expensesincluded under s. 7(1), which fit under the rubric of "special" expenses as that word is used in the heading of the section, the expensesneed not be extraordinary, but they must meet the tests of necessity and reasonableness. [93] The McLaughlin case was decided before s. 7(1.1) was added to the Guidelines. Under s. 7(1.1)(

a) the court is first required toconsider whether the income of the requesting spouse, including any child support received, can reasonably cover the expense claimedor whether the expense exceeds her ability to pay without any consideration of the factors enumerated in s. 7(1.1)(b).

If the incomecannot cover the expense, the expense is deemed to be extraordinary and the court’s next analysis turns to consideration of the factorsenumerated in s. 7(1) which, of course, brings into consideration the parties’ means and pre-separation spending pattern. ... [97] Section 7(2) of the Guidelines stipulates that expenses allowed under s. 7(1) are generally to be shared by the parents inproportion to their incomes, after first deducting the child’s contribution, if any. However, the court retains the discretion to divide theparents’ obligation other than in proportion to their incomes: Zarins v.

Cochrane, [1998] B.C.J. No. 2116 (S.C.), varied [1999] B.C.J.No. 2876 (S.C.), supplementary judgment [1999] B.C.J. No. 2450 (S.C.). For example, in Ebrahim v. Ebrahim, [1997] B.C.J. No. 2039(S.C.) [Ebrahim], the Court considered the following factors pertaining to the spouse claiming the expense when deciding whether or notto follow the guiding principle in s. 7(2) of the Guidelines: (

a) adequacy of their financial disclosure; (

b) the nature of their employment;and (

c) the availability of financial contribution from their family. [98] Where an expense is found to be special or extraordinary, but the reasonableness of the expense is in issue, “the court can lookbeyond the respective incomes of the parties and consider their overall means, including income from other sources, such as familyincome”: Pearse v. Pearse, 2010 BCSC 117, at para. 44 (also see Baum v. Baum, 2000 BCSC 1835, at para. 9). The corollary is thatwhere the reasonableness of the expense is not in issue, the broader means of the parties outside of their income levels should not beconsidered: J.P.S. v.

C.G.W., 2003 BCSC 968, at para. 15. Ultimately, where the expense is not within the “means” of the parties,depending on how broadly that term is treated for the given expense, the court may limit or deny the amount: see Ebrahim; and Miller v.Miller, [1997] B.C.J. No. 1322 (S.C.).

[99] The expense must also be necessary or advisable, and this element is not demonstrated “by the simple fact of the expense being incurred”: Thomas v. Thomas , 2000 BCSC 585 , at para. 24 [ Thomas ].)

i) Activities, Child Care, Camps and Lessons [ 36 ] Some of the expenses for the various lessons and activities may fall within the definition of extraordinary expenses of the Guidelines , but only if the claimant is unable to meet those expenses with the basic child support paid. [ 37 ] As I understand the evidence, the parties are sharing the costs of childcare for Pearl and out of school camps necessitated by the parties’ work schedules. [ 38 ] It is really the cost of lessons, activities and “other” camps that are at issue between the parties. [ 39 ] The claimant says that her financial situation is more or less the same as stated in the January 2013 F8 form. [ 40 ] If the child support payable by Mr.

Stewart ($919) is factored in, Ms. Goddard’s income exceeds her reasonable expenses by nearly $2,000 each year. Of course, Ms. Goddard is no longer receiving $205 from the respondent to meet Tyler’s tuition and other school costs so the figure is closer to $1,800 or $150 each month. [ 41 ] I find that Ms. Goddard can at present reasonably cover the disputed extracurricular expenses claimed and the expenses are not extraordinary . [ 42 ] If I am wrong in that finding, the conflicting evidence makes it impossible to determine whether the various expenses are extraordinary under s. 7(1.1) (

b) of the Guidelines . For example, Mr. Stewart takes issue with the necessity of the children attending multiple extracurricular activities. As well, Mr. Stewart questions the necessity of the children attending camps (which he says is effectively childcare) when he would otherwise be available to care for the children.

It is impossible to prefer one party’s evidence on these issues on this interlocutory application. [ 43 ] In the result, I decline to order that the respondent contribute to the various expenses under paragraphs 1 a. ii to vii and paragraph 2 a. ii to vii of the notice of application for the interim period. ii) Tuition for independent school [ 44 ] This expense more easily fits within the definition of “extraordinary” under s. 7(1.1) (

a) of the Guidelines. On the evidence presented, I find that the claimant is unable to afford this tuition expense on her own even with the basic child support received from the respondent. [ 45 ] The next consideration is whether the expense is necessary and reasonable. [ 46 ] The claimant relies on the decision of McDonald v. McDonald, 2001 BCCA 701 , in which the parties’ respective contributions towards their children’s private school tuition became an issue on appeal. In that case, the parties had proceeded to trial.

At trial, the parents agreed that attendance at private school was in the children’s best interests. The trial judge found that the school tuition was a reasonable expense despite both parties’ expenses exceeding their income at that time. On the appeal, the father took issue with this finding, primarily on the basis that his fortunes had declined since trial and he was unable to continue to pay his share of the tuition.

The Court of Appeal did not disturb the trial judge’s finding on the reasonableness of the tuition expense as of the trial date, but made an observation pertinent to this application: What is reasonable for a short period of transition can become unreasonable in the long term and with a change of circumstances. … at para. 29. [ 47 ] The result in McDonald v.

McDonald is distinguishable as the case was decided under a different test for determining whether an expense is extraordinary and ought to be shared (i.e. before s. 7(1.1) was enacted in 2006). [ 48 ] Since the parties’ separation, the respondent has repeatedly expressed his concern with the financial viability of the children’s attendance at an independent school. The fact that Mr. Stewart takes issue with the religious instruction is somewhat beside the point given these financial concerns.

Nevertheless, those concerns are worthy of consideration on a s. 7 application. [ 49 ] With some recognition of the parties’ financial difficulties, the claimant proposes that the respondent pay only his proportionate share of the after-tax tuition (being a deduction as a gift to a charitable institution). Even with this proposal, the respondent will be unable to meet his current expenses let alone move to more suitable long term accommodation.

Again, the parties’ debt load is not addressed in this proposal. [ 50 ] On my view of the evidence, the parties have not had the means to pay private school tuition for Tyler since at least July 2013. Accordingly, I decline to make an order that Mr. Stewart contribute to this expense for the 2013/14 school year. [ 51 ] Whether Mr. Stewart will be financially able to contribute to this expense for the 2014/15 school year is unknown. However, there are other issues which might impact the viability of the children’s attendance at this school, including Mr.

Stewart’s concern with the religious element of the education. [ 52 ] Indeed, besides financial viability, the court will wish to consider such things as the family history or tradition of private schooling and whether the school is overall in the children’s best interests. There is conflicting evidence on these matters. [ 53 ] Upon reflection, I have determined that the fairest result is to adjourn the claimant’s application with respect to the independent school tuition for the 2014/15 school year to trial.

Conclusion [ 54 ] As noted, there is no trial scheduled in this action. Other than setting the monthly child support payable for the next several months, I have been unable to resolve these contentious matters on an interlocutory basis. [ 55 ] The parties disagree on many important facts relevant to parenting, child support and even responsibility for family debt.

The JCC order contains some language of finality but the parenting order made in July, 2013 addresses only the interim period. [ 56 ] While there is always access to the courts in the interim period, orders granted before trial are seldom if ever intended to address important issues impacting the children (such as schooling) over the long term. Rather, interim relief has been traditionally viewed as providing rough justice until trial. Generally speaking, the court has not looked favourably on multiple applications being brought in the interim period: Sork v.

Sork, 2009 BCSC 998 at para. 34 . [ 57 ] It is recognized that in this case, the claimant brought her application to address the immediate need to pay Tyler’s tuition. As well, there is no order in place defining “extraordinary” expenses for the interim period. However, I must also observe that the application was brought before the parties had an opportunity to involve the divorce coaches who are intended to assist in the resolution of these important issues outside of the judicial process.

In the spirit of the Family Law Act , I encourage the parties to resort to the alternative dispute resolution process agreed to before bringing further applications before the court in the interim period. Alternatively, if the court is required to make findings on credibility in order to achieve some finality to the issues raised in the pleadings, a trial date ought to be set. [ 58 ] Costs of the application will be in the cause. “C.P. Bouck” Master C.P. Bouck