C.T. v. D.S., 2023 BCPC 126

Citation: C.T. v. D.S. 2023 BCPC 126 Date: 20230608 File No: 19541 Registry: Port Coquitlam IN THE PROVINCIAL COURT OF BRITISH COLUMBIA IN THE MATTER OF THE FAMILY LAW ACT , S.B.C. 2011 c. 25 BETWEEN: C.T. APPLICANT AND: D.S. RESPONDENT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE J. CAMPBELL Counsel for the Applicant: K. Brar Counsel for the Respondent: D. Lal Place of Hearing: Port Coquitlam , B.C.

Dates of Hearing: May 1 and 2, 2023 Date of Judgment: June 8, 2023 Overview [ 1 ] C.T. applies for an order for spousal support. C.T. and her former partner D.S. were married and lived together from 2012 until 2020 or 2021. During the marriage, D.S. was steadily employed as owner/operator of a scrap metal business. C.T. was not employed outside the home due to disabilities. Both parties now collect disability income. [ 2 ] C.T. submits that she is entitled to retroactive and ongoing spousal support.

C.T. submits that D.S. has not been forthcoming about his financial circumstances, and that the Court should impute income to D.S. for the purposes of determining spousal support. [ 3 ] D.S. submits that C.T. is not entitled to spousal support because C.T. was given sole ownership of the family home when the parties separated. D.S. further submits that he is currently on disability income and is not able to pay spousal support. [ 4 ] The issues to be determined are as follows: 1. Is C.T. entitled to an order for spousal support? 2.

If C.T. is entitled to spousal support, a. should income be imputed to D.S.? b. what should the amount and duration of spousal support be? Legal Principles [ 5 ] Sections 160 and 161 of the Family Law Act provide that a spouse may be entitled to spousal support based on the objectives set out in the Act . The objectives include: (

a) recognizing any economic advantages or disadvantages to the spouses arising from the relationship or the breakdown of the relationship; (

b) apportioning between the spouses any financial consequences arising from the care of their children; (

c) relieving any economic hardship arising from the breakdown of the relationship; and (

d) promoting the economic self-sufficiency of each spouse within a reasonable period of time. [ 6 ] Pursuant to

section 162 of the Act , the amount and duration of spousal support must be determined on consideration of the conditions, means, needs and other circumstances of each spouse including the following: (

a) the length of time the spouses lived together; (

b) the functions performed by each spouse during the period they lived together… [ 7 ] C.T. submits that she is entitled to spousal support on both a compensatory and a non-compensatory basis. [ 8 ] Compensatory support is based on the recipient’s economic loss or disadvantage because of the roles of each party during the relationship, or by not being properly compensated for the economic benefits the payor received as a result of the recipient’s contribution. [ 9 ] Examples include career loss due to caring for children throughout the marriage.

Compensation is for the economic disadvantages faced by a stay-at-home spouse. This includes lost economic opportunity as a result of a joint decision for that spouse to stay at home and raise children. The lost opportunity is the loss of experience, training and marketability in the workplace that arises from employment. [ 10 ] D.S. was steadily employed during the marriage, while C.T. was not employed due to disabilities. There were no children of the marriage. C.T. was primarily responsible for cleaning the family home. D.S. was responsible for other household duties, such as paying the bills.

The parties generally did not cook at home as they ate out on a daily basis. There was no conscious decision by the parties that C.T. would be a stay-at-home homemaker, as it seems that she was never capable of outside employment due to her disabilities. I do not consider that the evidence supports a claim for compensatory support. [ 11 ] However, there is a strong basis for non-compensatory support. Non-compensatory support is needs-based and does not depend on finding any economic loss arising from the marriage.

Non-compensatory support focuses on whether the spouse is suffering financial hardship as a result of the breakdown of the marriage. Financial need alone may be enough to establish entitlement to non-compensatory support. The relevant factors include financial hardship, the length of the relationship and whether there is a marked decline in the standard of living of the recipient after separation: Fisher v. Fisher , 2008 ONCA 11 ; McKenzie v. McKenzie , 2014 BCCA 381 .

[ 12 ] Before the parties married, C.T. lived in supportive housing through BC Housing. During the marriage, the parties had a reasonable standard of living. D.S. earned a healthy income by operating the scrap metal business. The parties ate at restaurants on an almost daily basis and occasionally travelled to Mexico. [ 13 ] C.T.’s standard of living markedly declined after the parties separated. She sometimes relies on financial assistance from friends and family, as well as her church.

She has sometimes relied on a food bank for her groceries. [ 14 ] C.T. has been unable to work for many years due to disabilities. She lives with a number of disabilities, including hand tremors and blindness. She is unable to see in one eye, and her vision is 50% in the other eye. She also reports that she has been diagnosed with borderline personality disorder and anxiety. She has been on disability income for many years. Her disability income is currently $1,390 a month. [ 15 ] She continues to live in the family home, a trailer.

Her son lives in the trailer on a part-time basis, and contributes $300 a month towards rent. Even with the rental money from her son, she finds it difficult to pay the expenses to maintain her home. The pad fees for the trailer are $640 a month. Property tax is $1,200 a year and insurance is $1,300 a year. She also has significant utility expenses. [ 16 ] Because of her financial circumstances, she is currently on the waitlist to get back into BC Housing. [ 17 ] C.T. is now 61 years old. It is unlikely that she will be employable in the future due to her disabilities.

Apportionment of Property [ 18 ] D.S. submits that C.T. is not entitled to spousal support, in part because the parties divided the family assets such that she was left with a disproportionate share of the family property.

D.S. transferred his share of the family home to C.T. in late 2020, which is when he says the parties separated. [ 19 ] Although this Court does not have jurisdiction over property, the issue raised by D.S. requires the Court to consider how the family property was divided for the purposes of determining whether there was a disproportionate division of the family property relevant to the issue of spousal support. [ 20 ] Under s. 81 of the Family Law Act , each spouse is presumptively entitled to an undivided half interest in all family property.

I n some cases, reapportionment of property division in favour of the spouse claiming support may address the statutory objectives of spousal support and accordingly eliminate or reduce the need for a spousal support award, but in others it may not. This is particularly applicable where entitlement to spousal support is based primarily on compensatory principles.

Where property has been reapportioned in favour of a support-seeking spouse, that spouse’s entitlement to and the quantum of support is determined by the extent to which the reapportionment compensates for the economic consequences of the marriage and the separation, including any claims for compensatory and non-compensatory support: Parton v. Parton , 2018 BCCA 273 at para. 42 . [ 21 ] In this case, D.S. took certain family assets with him after the separation and C.T. became the sole owner of the family trailer. The parties do not agree on the value of the trailer.

They purchased the trailer in 2020 for approximately $135,000. The assessed value in 2022 was $155,000. C.T. says that she does not know the current value. [ 22 ] D.S. has produced a letter from a local realtor dated April 11, 2022 with respect to the value of the trailer. The letter is a single paragraph, yet is inconsistent as to the value of the property. The realtor suggests that the home is worth $235,000. The realtor then says that $235,000 should be the listing price, and not necessarily the price that could be obtained if it were sold. He then states that the home should be listed at $299,900.

The letter does not report any comparable sales for the area, or otherwise explain the basis for the opinion. Further, the letter does not provide an opinion for the value of the trailer at the time of separation, which was late 2020 or early 2021. I conclude that little weight can be put on this letter in determining the value of the home. [ 23 ] Although C.T. received the family home in the separation, D.S. took other family assets with him after the separation.

The assets taken by D.S. include the following: a. a rare vintage vehicle, a 1964 Beaumont, which D.S. says is worth in the neighbourhood of $40,000 or $50,000; b. a recent model Harley-Davidson motorcycle purchased for $28,000; c. a 2021 Dodge Ram pickup truck that was purchased for $50,000. [ 24 ] At the time of separation, D.S. bought an RV to live in that cost approximately $65,000. He traded in a Ford 150 pickup truck for approximately $25,000 to put towards the purchase price. [ 25 ] C.T. testified that D.S. kept a safety deposit box with a significant amount of cash.

He was mostly paid in cash through his business and generally did not deposit much of his earnings to a bank account. The holdings in the safety deposit box were taken by D.S. when the marriage ended. [ 26 ] While C.T. received the family home, there is no question that D.S. left the marriage with significant family assets. Apart from the realtor’s opinion as to the value of the trailer, the parties did not provide formal appraisals of the value of the family assets. However, based on the testimony of the parties, D.S. received a significant share of the family property following the separation.

Based on the evidence, it is possible that he received approximately half of the value of the family assets at the time of separation. It is possible that he received more than half. [ 27 ] D.S. testified that he would not have transferred the trailer to C.T. if he thought he would be liable to pay spousal support. However, after the trailer ownership was transferred, D.S. sent text messages to C.T. indicating that he would make spousal support payments. He made one payment and then stopped. This evidence suggests that D.S. understood that he may have a spousal support

obligation notwithstanding how the property was divided. In other words, this evidence is inconsistent with the suggestion that D.S. believed that the apportionment of family property satisfied any spousal support obligation. [ 28 ] I find that the evidence does not establish that there was a disproportionate sharing of family property such that C.T. is not entitled to spousal support. [ 29 ] I find that C.T. is entitled to an order for spousal support.

Imputation of Income [ 30 ] An important factor in determining the spousal support order is the income of the parties. [ 31 ] D.S. says that he is no longer steadily employed. He continues to work in scrap metal but he says that his work is greatly reduced. He now receives disability income and says that he is not in a financial position to pay spousal support. [ 32 ] C.T. submits that income should be imputed to D.S. The onus of establishing that income should be imputed lies with the party seeking to impute it.

C.T. must do so on a balance of probabilities. [ 33 ] The Federal Child Support Guidelines sets out the test for the imputation of income. Although this is a spousal support application, the principles from the Federal Child Support Guidelines apply to the issue of imputation of income. [ 34 ] Pursuant to section 19(1) of the Guidelines , the Court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which include the following: (

a) the spouse is intentionally under-employed or unemployed… (

f) the spouse has failed to provide income information when under a legal obligation to do so… [ 35 ] During the marriage, D.S. worked in his scrap metal business approximately three days per week. On some days, he employed two of C.T.’s adult children to work with him. He testified that when he was working, he earned approximately $10,000 a month. [ 36 ] The majority of his income was received in cash. He did not deposit much of his income into the bank.

He kept large amounts of cash at home, on his person and in a safety deposit box. [ 37 ] D.S. suggests that his scrap metal business is greatly reduced and his income is significantly lower than during the marriage. He notes that in 2021, his income as stated on his tax return was $6,600. In 2022, his income as stated on his tax return was $17,000. D.S. says that since separation, his income is mostly from disability payments. [ 38 ] While his tax returns show a modest income, it is evident that D.S. has not declared all of his income on his tax returns in the past.

Even prior to the separation, his tax returns did not fully reflect his income. In 2019, his tax return showed an income of $16,000. In 2020, his tax return showed an income of $12,000. However, D.S. was working steadily until the time of separation. According to his testimony, he was earning over $100,000 a year. His income was much higher than what was reported on his tax returns. I am not satisfied that the tax returns accurately reflect his income. [ 39 ] In addition to his disability income, D.S. says that he has done limited work for cash in the last two years. The extent of his income is uncertain.

It is possible that D.S. has minimized or downplayed his income in his testimony. [ 40 ] D.S. has produced some banking records indicating that his bank account is sometimes in overdraft. However, the majority of his income is received in cash and D.S. historically has not deposited much of his income in bank accounts. [ 41 ] C.T. notes that D.S.’s banking records show that there are significant deposits, suggesting that he is in a better financial position than he admits. [ 42 ] D.S. owns several vehicles and pays to insure a number of them at the same time.

Based on his reported income, it is not clear how he affords the significant insurance costs and other expenses for his vehicles. [ 43 ] C.T. testified that D.S. told her when they separated that he would go on disability so he would not have to pay support. C.T.’s daughter T.T., testified that she also heard D.S. say this to C.T. However, this was not put to D.S. in cross-examination and he did not have an opportunity to respond to this allegation.

As this allegation was not put to D.S., I find that little weight should be placed on this evidence. [ 44 ] D.S. says that he is unable to work due to his mental health. He says that he has lived with schizoaffective disorder, bipolar disorder and depression for many years. He testified that he has spent periods of time in psychiatric hospitals. However, it has been several years since the most recent stay at a psychiatric hospital in 2011. [ 45 ] D.S. relies on a doctor’s note written in 1996 indicating that he has manic episodes related to abusing alcohol and drugs.

The note says that he suffers from major affective disorder and bipolar disorder. The note states that these barriers make it difficult for him to attend to normal daily living activities. However, this note was written over 25 years ago when D.S. first applied for disability benefits. It is not a current reflection of his mental health or his ability to work. [ 46 ] D.S. also relies on a hospital record from 2013. The record states that he has a history of psychosis which has been managed on medication for a number of years. The record also reports a past history of depressive and anxiety symptoms.

However, this hospital record is also quite dated and is not a current record of his mental health. [ 47 ] The only current medical information for D.S. is a letter from his family doctor dated February 23, 2022. It is a one-line letter

stating that D.S. was not working at that time due to his mental health condition. [ 48 ] In my view, the medical information that has been provided does not provide a reliable indication of his current health or his ability to work. The letter from his doctor does not refer to any clinical records or provide any detailed particulars about his health. The other medical records are severely outdated. There is no formal assessment of his current ability to work.

I find that the evidence is insufficient to establish that D.S. is genuinely incapable of working due to his mental health. [ 49 ] I find that income should be imputed to D.S. [ 50 ] C.T. submits that D.S.’s income should be imputed at $80,000. D.S. submits that if the Court finds that he should be imputed with income, it should be based on minimum wage. [ 51 ] I am not confident that D.S. is capable of earning the income that he earned before the separation. D.S. testified that the most lucrative part of his business was buying and selling catalytic converters.

He said that competitors have taken much of that business and that he gave up selling catalytic converters before he stopped working. [ 52 ] I accept that he earns less than he earned in the past. For example, there was a period of several months after the separation when D.S. lived in Kelowna, and says that he did not do any scrap metal work at all. [ 53 ] D.S. currently receives some income from working in scrap metal, although it is uncertain how much as his income is mostly cash-based. [ 54 ] I find that D.S.’s income should be imputed at $45,000.

Amount and Duration of Spousal Support Order [ 55 ] Based on the Spousal Support Advisory Guidelines (the “SSAG”), the support obligation ranges from a low of $326 to a high of $425, with a mid-range of $381. [ 56 ] I have determined that the spousal support obligation should be set at the mid-range for the following reasons. [ 57 ] This was a relationship of approximately nine years, which is of moderate length. The marriage lasted from 2012 to 2020 or 2021. It seems that the parties first separated at the end of 2020, but made some attempts at reconciliation.

It is clear that the marriage was over by August 2021. [ 58 ] There is a strong claim for support based on C.T.’s financial need. She is 61 years old and likely unable to return to work. Although she continues to live in the family home, there has been a marked decrease in her standard of living. She finds it difficult to cover the expenses for the family home. When the parties were married, the household income was likely over $100,000 a year. C.T. now earns approximately $16,000 in disability income.

Where she previously ate out at restaurants with D.S. on a daily basis, she now relies on support from others in her community. [ 59 ] In determining the spousal support order, I take into account that C.T. has a significant asset in her home. The home is modest, but she has significant equity as there is no mortgage. As noted above, C.T. owning her home does not eliminate the entitlement to spousal support, as the evidence does not establish a disproportionate division of family property.

Further, a person should not be required to sell their home to sustain themselves, particularly where the home is of modest value. However, the value of the home is relevant to the conditions, means and needs of the recipient. C.T. testified that she hopes to move. If she moves, she may decide to sell her property, as it will no longer be her principal residence. The proceeds will be significant.

I find that this is relevant to the spousal support order, including the duration of the spousal support order. [ 60 ] Based on all of the circumstances, including the length of the marriage and the means and needs of the parties, I find that spousal support should be payable at the mid-range of $381 for a period of five years. [ 61 ] C.T. submits the spousal support order should commence September 2021. This would place D.S. in a position of owing substantial arrears. In my view, the spousal support obligation should commence as of July 1, 2023. ______________________________ The Honourable Judge J.

Campbell Provincial Court of British Columbia