2018 QCCA 692, 2018 QCCA 692

Droit de la famille — 18914 2018 QCCA 692 COUR D’APPEL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTRÉAL N° : 500-09-026648-170 (500-12-318540-139) DATE : May 1, 2018 CORAM : THE HONOURABLES MARK SCHRAGER, J.A. ROBERT M. MAINVILLE, J.A. MARIE-JOSÉE HOGUE, J.A. S. T. APPELLANT — Plaintiff v. N. W.

RESPONDENT — Defendant JUDGMENT [ 1 ] On the appeal from a judgment rendered on January 19, 2017 by the Superior Court, District of Montreal (the Honourable Marie-Claude Armstrong), which granted the parties’ divorce and issued various corollary relief orders; [ 2 ] For the reasons of Hogue, J.A., with which Schrager, J.A., and Mainville, J.A. agree, THE COURT : [ 3 ] ALLOWS the appeal, in part; [ 4 ] QUASHES the trial judgment for the sole purpose of replacing paragraphs [174] [177] and [181] of the conclusions by the following paragraphs: [174] RATIFIES the Agreement signed by the parties on June 28, 2011, of which a copy is annexed to this judgment, save for paragraphs 19 and 20, and ORDERS the parties to abide by its terms; [177] ORDERS Plaintiff to pay to Defendant spousal support of $2,800 gross per month for the year 2015; [181] With respect to the RESP Account number […], National Bank Financial-[…]:

a) ORDERS Plaintiff to CONTRIBUTE an amount of $14,500 to the account, REIMBURSE defendant from said account an amount of $10,043,94 and VEST the management of the account to Defendant, the whole within 60 days of this judgment;

b) ORDERS Defendant to remit to Plaintiff on January 10 and July 10 of each year, a copy of the latest statement of the account. [ 5 ] DECLARES that the Appellant is entitled to recover and reserves his right to any overpayment already made to Plaintiff further to the original Superior Court’s judgment dated January 19, 2017. [ 6 ] THE WHOLE , without costs. MARK SCHRAGER, J.A. ROBERT M. MAINVILLE, J.A. MARIE-JOSÉE HOGUE, J.A. Mtre Justin Roberge CARON ROBERGE INC. Me Sylvia Beatrix Schirm

SCHIRM & TREMBLAY For the Appellant Mtre Miriam Grassby GRASSBY & ASSOCIÉS For the Respondent Hearing date : October 26, 2017 REASONS OF HOGUE, J.A. [ 7 ] Did the trial judge petitioned by the parties to homologate the agreement settling all relief corollary to their divorce err by refusing to homologate the clause relating to spousal support which she believed was contrary to the Divorce Act ? [ 8 ] This is the central question of this appeal. THE FACTS [ 9 ] The parties met in Toronto in 1989 and married in Town A one year later.

The appellant was employed by a large corporation, while the respondent worked as an associate professor at the University B Faculty of A and, subsequently, as program director and coordinator of the [Center A]. [ 10 ] In 1993, the appellant was promoted – a promotion which required him to move to Barcelona. In the summer of 1994, the respondent left her job to join him. She had no work visa, however, and couldn’t work. [ 11 ] Their first daughter was born in 1995.

The respondent was the primary caregiver while the appellant was traveling in Europe for work and completing an MBA. [ 12 ] The couple then moved to the Netherlands for the appellant’s work. The respondent was still not allowed to work, but acted as a consultant for Canadian businesses and the Canadian armed forces. She also completed a masters at the University A from 1998 to 2000, and began a PhD which she did not complete. [ 13 ] Their second daughter was born in 2000.

The respondent continued to be the primary caregiver for the children, while the appellant devoted a great deal of time to his career. [ 14 ] In 2002, the corporation for which the appellant worked was purchased by an American corporation and he was transferred to Wisconsin. However, the parties decided that the family would live in Town A where the appellant would join them every third week, spending the other two weeks in Wisconsin.

He returned to Quebec in December 2003. [ 15 ] The respondent, for her part, found a position as a research assistant at [University C] in 2004 and, that same year, started a consulting business. [ 16 ] In 2008, the University offered her a research grant until November 2012. [ 17 ] The parties separated in February 2009. They agreed to share custody of the children and began discussing corollary relief for their upcoming divorce.

They were both represented by counsel. [ 18 ] The appellant lost his job in August 2009, shortly after the separation, and received a severance package equivalent to 18 months of salary. [ 19 ] In 2009, being of the view that he could no longer find employment as remunerative as his former job, the appellant started a business of which he was the sole shareholder. He refused job offers, deciding instead to try to get his business off the ground. [ 20 ] On June 28, 2011, after participating in a collaborative process, the parties finally arrived at an agreement.

The agreement covered the family residence, the partition of the family patrimony, child support and spousal support in addition to setting out the manner in which the parties would settle their debts owed to each other. The provisions most relevant for our purposes are the following: Spousal Support

6. S. agrees that he relinquishes his right to ever seek or request spousal support from N.. 7. Both parties agree that S. has paid N. a lump sum of $95,335.45 in after tax dollars, for the period of February 1, 2009 to March 30, 2011. 8. Both parties acknowledge that payment / receipt of this compensatory after tax sum does not release S. from future obligations for spousal support to N.. 9. N. and S. agree that no spousal support payments are required from S. to N. for after March 31, 2011 until such time that S. regains his income to the level prior to the end of the marriage (approximately $320,000). a.

At such time, S. and N. agree that spousal support calculations for S. to N. will be made retroactively for the relevant fiscal year and going forward for subsequent years basing calculations on the principle of equalization of income and using of the Federal Spousal Support Guidelines. […] 19. For the period of April 1, 2011 forward, N. agrees to pay 50% of non-discretionary children’s expenses for basic needs b.

Non-discretionary children’s expenses are accepted as including: mandatory child care costs, mandatory school costs at public primary and secondary schools and CEJEP, health costs (including medical insurance for the children), grooming (hair cuts), required clothing costs and allowances. However, both N. and S. understand that the Quebec rules govern acceptable non-discretionary children’s expenses included in child support calculations and agree to abide by these rules. Both also agree to keep a record of the date, specific expense and costs of such expenses. c.

For 2011 and 2012, such records will be submitted to the other party at the time of establishing any appropriate child support payments and restitution made, according to Quebec child support guidelines, to the other party for the appropriate amount, within 30 days. d. Thereafter, once child support payments have been established for 2013, expenses will be submitted to each other on February and August 1, with payment within 30 days. 20. For the period following April 1, 2011, regarding discretionary children’s expenses (i.e. special or extra costs).

N. and S. agree that all expenditures greater than $150 require prior agreement in writing from both parties. S. will be free to make his decisions regarding the amount he can pay for these expenditures based on his available finances, budget and and financial priorities. N. will also be free to make her decisions regarding the amount she can pay for these expenditures based on her available finances, budget and financial priorities. a.

Special costs that are included for consideration for sharing include children’s sports (including X’s horse back riding), children’s activities, 33% of N.’s gasoline costs (for driving X to riding competitions). Costs that are excluded from consideration for sharing include, but are not limited to, gifts to the children, entertainment with the children and vacation costs. [Sic] [ 21 ] The respondent continued her work as a researcher. In August 2012, however, she learned that she had breast cancer and would require treatment. The illness forced her to stop working multiple times to undergo surgery.

Consequently, she was not able to renew her research grant. The University nevertheless extended it until December 2013. [ 22 ] In August 2013, to improve her employment opportunities, she moved to Ottawa with the children. [ 23 ] In August 2014, the appellant decided to accept a job for which he would be paid a salary of $175,000 plus a bonus. At the same time, his company sold a risk-management program he had created to the new employer for $200,000.

The corporation paid him this amount partly in dividends issued in 2014, the remainder being paid in 2015 as reimbursement of shareholder advances. [ 24 ] In the meantime, that is in June 2013, he filed for divorce. He did not seek to have the 2011 agreement homologated and did not even mention it in the proceedings, instead asking the court to rule on relief corollary to the divorce (custody, partition of the family patrimony and child support). [ 25 ] The respondent did not oppose the divorce, but she challenged several of the applications for corollary relief and sought to have the agreement homologated.

She submitted that she was owed spousal support because, in her view, the appellant was now earning roughly $320,000 – the approximate threshold set in the agreement for triggering her right to support. [ 26 ] The appellant agreed to homologate the agreement, as reflected in a document containing a variety of admissions.

He refused, however, to pay spousal support to the respondent since, he said, his income had not reached the threshold set out therein. [ 27 ] The case on the merits was heard on June 13 to 16 and June 28, 2016. [ 28 ] The judge took the matter under advisement and rendered judgment on January 19, 2017. [ 29 ] She granted the divorce of the parties.

However, she only partially homologated the agreement, refusing to homologate clauses 9, 19 and 20. [ 30 ] After partitioning certain assets, she ordered the appellant to pay – for the years 2014, 2015 and 2016 and for the future – child support calculated using the Quebec table of federal child support guidelines, as well as spousal support. [ 31 ] The judge also ordered him to pay $14,500 into a Registered Education Savings Plan (RESP) and to assign his rights as

subscriber to the respondent. [ 32 ] Before us, the appellant essentially attacks the judge’s refusal to homologate clause 9 of the agreement and, consequently, contests the grant of spousal support. [ 33 ] He also challenges the inclusion of the income from the risk management program’s sale in his revenue, the failure to analyze the respondent’s income for the years 2015 and 2016, and the judge’s failure to consider the respondent’s obligation to ensure he did not bear all the financial consequences of her return to school.

Finally, he submits that the judge did not have jurisdiction to order him to contribute to the RESP and to assign his subscription rights to the respondent. [ 34 ] Before turning to these various grounds of appeal, it is useful to revisit how the trial judge proceeded and her reasons supporting the conclusions that the appellant attacks. THE JUDGMENT UNDER APPEAL [ 35 ] After having set out the facts, the trial judge determined the income of each of the parties. In her calculations she included income directly earned by each of the parties, as well as income earned by the entities they controlled.

For the years 2014 and 2015, she then added to appellant’s income the amount obtained for the risk management program sold by his company to his new employer because, she said, it was his services and expertise that had been sold.

She also held that he had negotiated his employment contract and the sale of the program globally, and that the sale price had been established according to the number of days he had dedicated to developing the program. [ 36 ] She set the appellant’s income at $290,041 for the year 2014, $318,624 for the year 2015 and at $221,660 for the year 2016. [ 37 ] As for the respondent, the judge set her income at $112,677 for the year 2014, $51,851 for the year 2015 and $0 for the year 2016.

However, she did not consider income earned, if any, by the respondent’s companies or trusts in these final two years because this remained unknown. [ 38 ] The judge then proceeded to determine the child support and related special expenses. At this point, she set aside clauses 19 and 20 of the agreement, since these aimed to establish how the parties would divide responsibility for certain basic expenses for the children.

The parties do not challenge this aspect of her decision. [ 39 ] The judge then turned to the evidence and held that the appellant had undertaken to contribute to the RESP put in place for the children to the same degree as the respondent. She also concluded that he had used part of the sum included in the RESP to pay some of the eldest daughter’s tuition fees, whereas the respondent had used her own money to do so. The judge thus ordered him to make a contribution to the RESP equivalent to that made by the respondent and to reimburse her, from the RESP, for the tuition she had already paid.

Moreover, observing the difficulty the parties had in agreeing on management of the RESP, the judge concluded that it was appropriate for the respondent to control the account. This observation resurfaced in her conclusions, namely by way of an order enjoining the appellant to assign his subscriber rights to the respondent. [ 40 ] Finally, she turned to the respondent’s application for spousal support.

She drew from the evidence that the respondent had sacrificed part of her career to accompany the appellant to Europe, that she had been the parent responsible for managing the family while they shared a household and that her current financial needs surpassed her income. Respondent’s income, she added, was still lower than the appellant’s. [ 41 ] The judge then asserted that she was not bound by clause 9 of the agreement and that she had ultimate jurisdiction to determine spousal support pursuant to s. 15.2(1) of the Divorce Act . Relying on the Supreme Court’s decision in Miglin v.

Miglin , [1] and the two- prong test set out therein, she referred first to s. 15.2(6) (

a) of the Divorce Act . She held that this provision dictates that one of the objectives of spousal support is recognizing any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown, including, she specified, financial disadvantages for a spouse who focuses on the needs of the family rather than a career.

She concluded that the respondent fell into this category. [ 42 ] Proceeding to the second step of the Miglin test, the judge was of the view that the respondent found herself in a situation that was unforeseeable when the agreement was signed in 2011, because she was no longer able – at least for the time being – to obtain contracts in her field due to the illness she suffered in 2012 and 2013 and to the fact that she had been unable to finish her doctorate.

In her opinion, the circumstances had shifted sufficiently to conclude that the agreement no longer reflected the intentions of the parties when they had concluded the agreement and, thus satisfied the second stage of the test. Holding that clause 9 did not reflect the objectives of the Divorce Act , she refused to homologate it. She therefore set support payable to the respondent according to the applicable federal guidelines for spousal support. THE PARTIES’ POSITIONS [ 43 ] The appellant submits that Miglin is inapplicable given that the parties seek homologation of the agreement.

As such, the judge should not have modified the agreement unilaterally and required him to pay spousal support when his income had not reached the $320,000 threshold provided for therein. [ 44 ] He adds that both the parties and the Court had proceeded at the hearing as though the agreement would be homologated, the real issue being whether his income had reached the threshold set out at clause 9. He cites numerous exchanges to this end, including the following:

Mtre Myriam Grassby: My Lady, I’m just going to intervene because I want us to be careful. We have a homologated agreement, an agreement which is to be homologated, we agree. It says what is to be . It says there is to be… over a certain income, Monsieur is to pay spousal support, it says how it’s supposed to be done, the right is there. We’re not here today talking about does Madame have a right to spousal support.

It says he will pay spousal support if he earns in the range of three hundred and twenty thousand ($320,000), so I don’t know that we have to go back over each and everybody’s point of view on each and every move, etcetera. I just, I’m bringing this forward as an objection. Your Lady will decide it. Of course, my client will be referring to the fact that her income is not what it was because of the fact that she went through all these moves… The Court: Well, that, I expect that this is… Mtre Myriam Grassby: Yes, I understand. The Court: …this is what Madame will come forward with in terms of her testimony.

Mtre Myriam Grassby: But in any event, the agreement provides that there is supposed to be spousal support which is paid. The Court: Yes, but you know… It will allow the witness to provide information, and I will allow Madame, when she will testify, to provide information on that level, because even though the parties have agreed that if Monsieur earns equal or above to approximately three hundred and twenty thousand dollars ($320,000) a year, Madame will qualify for spousal support; but the Court has to determine the nature of the support that will be awarded, either compensatory or not.

You know, there is a component that could be for compensatory reasons. Mtre Myriam Grassby: Although the agreement does provide that it’s going to be done by this… does say it’s going to be done by the spousal support advisory guidelines, so that the amount of support is not going to be… you’re not really going to really have to make that determination. I don’t want to be argumentative; I just want us to be sure that, you know, that it does say how it’s going to be determined, and I think that there’s going to be… The Court: Yes, that’s true.

Mtre Myriam Grassby: …not that much discretion in terms of what the amount is, if we can demonstrate that he has reached income. I just… The Court: So what will remain to be… the Court will eventually decide what Monsieur’s income, and then if – what you will plead is how the bracket of the spousal support advisory guidelines should be applied. In this case, should we go towards the lower amount of the bracket, or the highest amount of the bracket?

I haven’t looked it up… […] The Court: Exactly, but at the end of the day I agree that given the way paragraph 9 of the agreement of 2011 is drafted, you know, did… to what extent has Madame’s career decisions and what she might have abandoned or not, versus what Monsieur’s… to what extent Monsieur’s career was privileged or not, given the structure of paragraph 9(a), is not that relevant ; but I will allow the parties to touch on the issue but briefly. […] The Court: …even if, even if Monsieur has the perception, or even if he was able to demonstrate that he did pay more than what he was recommended by his lawyer, it doesn’t change the fact that the agreement is structured the way it is; and that the parties agree that if Monsieur’s income was to return to the level it was at the time of… Mtre Myriam Grassby: In the range of three twenty ($320,000), yes.

The Court: I know there is a paragraph in your agreement that says if Monsieur’s income returns to what it was… okay. His income to the level prior to the end of the marriage, that’s at paragraph 9. Mtre Myriam Grassby: Yes. Because we risk ending up having Madame talk about all of the things that she compromised on. The Court: No, no, I agree. Mtre Myriam Grassby: Yes. The Court: We shouldn’t open that door because you are both asking the Court to ratify the agreement… Mtre Justin Roberge: Yes.

The Court: …and the agreement already provides that if Monsieur’s income is equal or greater than three hundred and twenty thousand dollars ($320,000) a year, Madame will be entitled to support based on the spousal advisory guidelines; and what will remain justified to represent is if Monsieur’s income is equal or greater than three hundred and twenty thousand dollars ($320,000) a year… […] The Court: You cannot come before the Court today and say well, you’re not bound by the guidelines.

The parties decided to bind themselves by the guidelines, and the Court cannot reopen that, especially in the context here where both parties are asking the Court to ratify the agreement . […] The Court: Because if you want the Court to ratify the agreement, the Court has to apply the agreement. Mtre Justin Roberge: I agree with you.

The Court: And it has to exercise a discretion within what the agreement provides for. […] The Court: Mtre Grassby, I’d like to know if your client’s request for spousal support only stands as long as the Court comes to the conclusion that Monsieur makes approximately three hundred and twenty thousand dollars ($320,000) a year in a very specific application of D-28, or if the Court was to conclude that Monsieur doesn’t earn three hundred and twenty thousand dollars ($320,000) per year, what is Madame’s request?

That the Court should not be bound by the agreement of the parties or… Mtre Miriam Grassby: No, we’re bound by the agreement. The Court: Okay. Mtre Miriam Grassby: We’re asking that the agreement be homologated. It’s a package. [Emphasis added]

[ 45 ] He adds that, apart from an allusion to this possibility while responding to a question asked of his counsel during pleading, the judge gave no hint that would have led the parties to believe she would not homologate the agreement in its entirety. [ 46 ] In his view, moreover, the evidence demonstrates that the agreement is an integral whole, the result of a compromise reached after lengthy negotiations between the parties – both highly educated and represented by experienced, specialized counsel – on an equal footing. [ 47 ] The appellant further submits that it was in consideration of the respondent’s waiver of spousal support prior to his income reaching a certain level that he had accepted to apply the Spousal Support Advisory Guidelines .

Besides, he had waived any spousal support for himself, independently of his needs and the respondent’s capacities. [ 48 ] He also submitted that the sale price of his risk management program should not be included in his income because it constituted a capital gain flowing from the sale of an asset and, finally, that the judge was not empowered to order him to contribute to the RESP or to assign his subscriber rights to the respondent. [ 49 ] For her part, the respondent submits that the judge was not bound by the agreement and that she could set aside certain provisions – even in the absence of a request to do so.

The question she posed to appellant’s counsel during oral argument was, moreover, sufficient to alert him to this possibility and to give him an opportunity to make his point of view known. [ 50 ] Instead, she says the evidence reveals that she received nothing in return for waiving spousal support until the appellant’s income reached roughly $320,000. [ 51 ] She added that, in any case, the judge had concluded that the appellant was in bad faith and, thus, she could impute income to him, conclude that the threshold set out in the agreement had been reached and order him to pay support. [ 52 ] The judge, she went on, was right to include the sale of the risk management program the appellant had developed in his income because this sale had formed part of the negotiations of the contract with his new employer. [ 53 ] Finally, she believes that while the agreement does not provide for the parties’ respective contributions to the RESP, a subsequent agreement was made, by email, according to which the appellant undertook to invest the same amount as she did.

The judge, she says, had merely given effect to this agreement. ANALYSIS The refusal to homologate part of the agreement [ 54 ]

Article 454 C.C.P. confers the power of homologation upon trial judges: The court seized of an application for the homologation of an agreement or a draft agreement between the parties may amend the agreement or draft agreement on the basis of the interests of the children or one of the spouses.

The court may also postpone its decision until the parties have amended the agreement or draft agreement, or deny homologation, in which case the proceeding continues. [ 55 ] This provision clearly allows for the court to amend the agreement submitted – implying that the court may amend or strike certain provisions of the agreement.

That this power has been granted to judges led this Court to affirm that support agreements cannot be considered transactions: [TRANSLATION] [39] Indeed, support agreements cannot be considered transactions with all of the consequences that flow from art. 2633 C.C.Q. ( res judicata ), because the parties’ agreement is subject to review by the court, to whom the legislature has granted jurisdiction over the matter via the [ Divorce] Act .

Consequently, judges must consider the respective needs and abilities of the parties and verify, among other things, whether the objectives and factors set out in the Act (s. 15.2) are met. [2] [ 56 ] However, the Act does not specify whether judges may amend agreements at will, after having advised the parties, or if one of the parties must request that the judge do so. [ 57 ] It flows from the courts’ determination that custody and support are matters of public order, that the courts are not bound by agreements between the parties and thus have power to make amendments proprio motu . [3] [ 58 ] This being so, a court may not amend an agreement on a whim but must respect the framework established by the Divorce Act and the case law, as well as the parties’ right to be heard.

Neither does this discretionary power authorize the judge to simply substitute his or her own opinion about what is fair for what the parties have deemed acceptable or to intervene without advising the parties beforehand and giving them an opportunity to make representations and lead additional evidence. [ 59 ] What happened here? [ 60 ] First, remember that the respondent had asked the trial judge to homologate the agreement between her and the appellant and then to apply it in issuing a support order pursuant to s. 15.2 of the Divorce Act : 15.2

(1) A court of competent jurisdiction may, on application by either or both spouses, make an order requiring a spouse to secure or pay, or to secure and pay, such lump sum or periodic sums, or such lump sum and periodic sums, as the court thinks reasonable for the support of the other spouse.

Interim order

(2) Where an application is made under subsection (1), the court may, on application by either or both spouses, make an interim order requiring a spouse to secure or pay, or to secure and pay, such lump sum or periodic sums, or such lump sum and periodic sums, as the court thinks reasonable for the support of the other spouse, pending the determination of the application under subsection (1). Terms and conditions

(3) The court may make an order under subsection (1) or an interim order under subsection (2) for a definite or indefinite period or until a specified event occurs, and may impose terms, conditions or restrictions in connection with the order as it thinks fit and just. Factors

(4) In making an order under subsection (1) or an interim order under subsection (2), the court shall take into consideration the condition, means, needs and other circumstances of each spouse, including (

a) the length of time the spouses cohabited; (

b) the functions performed by each spouse during cohabitation; and (

c) any order, agreement or arrangement relating to support of either spouse. Spousal misconduct

(5) In making an order under subsection (1) or an interim order under subsection (2), the court shall not take into consideration any misconduct of a spouse in relation to the marriage. Objectives of spousal support order

(6) An order made under subsection (1) or an interim order under subsection (2) that provides for the support of a spouse should (

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

b) apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage; (

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

d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time. [ 61 ] Her application for spousal support was based on the premise that the appellant was earning roughly $320,000 and that, as such, the threshold stipulated at clause 9 had been met.

In the alternative, she adds, he had acted in bad faith and, as such, the judge could impute income to him if she believed there was insufficient evidence that this is what he was earning. [ 62 ] The appellant challenged the respondent’s claim; it was in this context that the legal debate between them began and would continue before the trial judge. [ 63 ] As such, the parties presented the evidence they believed to be relevant and necessary for the court to decide the matter, taking for granted that the agreement would be homologated as a whole – as they had requested.

The excerpts cited above illustrate, moreover, that in light of clause 9, the judge – like the parties – considered it unnecessary to prove certain facts. She even limited some of the testimony as a result. [ 64 ] This was how she came to indicate to counsel that she would allow them to “[TRANSLATION] touch only briefly” upon the role each party had assumed during the marriage and the impact of the marriage on their respective careers.

The negotiations leading up to the agreement were also addressed only briefly, their relevance being considerably diminished by the fact that both parties sought homologation. [ 65 ] The question of spousal support being one of public order, I am of the view that the judge clearly had the power to inquire as to the fairness of the process that led to the agreement.

She could also question whether the provision itself, which established the $320,000 income threshold for the ex-husband before the ex-wife would have a right to spousal support, was fair. [ 66 ] She could not, however, simply proceed as she did, namely by deciding unilaterally and without advising the parties not to homologate clause 9 despite their request that she do so. In proceeding in such manner, she set aside a single provision of a freely negotiated agreement concluded between informed and adequately represented parties, without giving them an opportunity to be heard.

The parties were also denied the right to lead evidence as to the reasons that caused them to enter this agreement, the concessions and gains each made and the overall result. [ 67 ] Remember that private agreements in family matters must be analyzed as a whole, that they are not always severable [4] and that, here, counsel for the respondent had expressly indicated that the agreement was an integral whole.

Consequently, it was imperative that the parties be informed of the possibility that certain provisions of their agreement could be set aside by the court and that they be given the opportunity to demonstrate the interactions that may exist between the various components of the agreement. [ 68 ] Failure to do so comes at the heightened risk that one of the parties will be denied a benefit for which it has made a concession.

Agreements that seek to settle relief corollary to a divorce are often the product of long negotiations during which each of the parties realizes certain gains, but also makes compromises, often as a function of their respective priorities. [5]

[ 69 ] Without the benefit of seeing all of the evidence, given the limits of legal debate, courts may not amend the judicial contract without advising the parties. A court that does so risks causing serious prejudice to one of the parties without giving that party a right to be heard, thus violating the rule of audi alteram partem . [ 70 ] In addition, I believe that the exchange that took place between the judge and counsel for the appellant during pleading is not sufficient to conclude that the appellant had an opportunity to present his point of view.

Here is that exchange: [TRANSLATION] THE COURT It goes without saying that we’re discussing spousal support. And if the parties, in their agreement, provided for a mechanism whereby they said “We want there to be… We want the Guidelines for Spousal Support to apply so that there is an ‘equalization of income’, a recalibration of income, subject to Monsieur making $320,000 a year.

So, if Monsieur is making two hundred and ninety thousand ($290,000), two hundred twenty thousand ($220,000), whatever, in any case, not three hundred and twenty thousand ($320,000), let’s say, based on what you’re telling me with your numbers, is public order respected when you say: we’re simply going to, we are going to apply the structure that the parties set out in the agreement, plain and simple.

And if – I’m not there yet, but if the Court said that Madame is in a situation where she qualifies as a creditor of spousal support and that she should get something, but because Monsieur is not making three hundred and twenty thousand ($320,000) a year, she will get nothing, because the parties structured things that way in their agreement. So, I’m asking you the question: even if this is what the agreement sets out, given the Court is a guardian of public order with respect to support obligations between the parties, is… What is your position on that? Because… Mtre JUSTIN ROBERGE: Yes, I understand you.

THE COURT: I’m telling you in all intellectual honesty because I know the applicable case law, as do both you and Mtre Grassby, and the notion of public order when it comes to spousal support, and I’m not saying that it is for sure that the Court is going to determine that Madame is a spousal support creditor… well. Mtre JUSTIN ROBERGE I understand, but we have to be careful not to lose the nuances.

THE COURT: There are a lot of factors to take… to consider, but I am alive to the fact that there is a possibility that the Court is not bound by the structure that the parties have set out making Madame’s right to spousal support dependant on Monsieur’s income. [ 71 ] Here, the judge had not indicated her intention not to homologate clause 9 of the agreement. The question asked, given her previous comments regarding the limits of the legal debate that occurred before her, seems harmless in the circumstances.

Both parties having completed their evidence – respondent’s counsel having finished her pleading, and appellant’s counsel having begun –it was reasonable for the latter not to interpret the question as a warning that the judge might refuse to homologate clause 9 and not an invitation to complete his evidence if he thought it necessary.

Remember that the parties sought to have the agreement homologated and that, as such, they had both presented evidence assuming that this would occur. [ 72 ] In these circumstances, it is certainly not appropriate to criticize appellant’s counsel for not having realized that the judge might unilaterally decide to set aside clause 9 and for not having sought to re-open the hearing. [ 73 ] Moreover, art. 323 C.C.P. requires a judge who has taken a matter under advisement to give the parties an opportunity to make representations if the judge realizes that a principle or rule of law has not been discussed. [ 74 ] The parties and their counsel must be able to take for granted that the court will decide the debate before it according to the judicial contract they have agreed to and that they will be explicitly advised if, for one reason or another, the court decides to do otherwise.

If this is not done, it becomes difficult, impossible even, for counsel to do their work adequately while respecting the principle of proportionality. Requiring counsel to anticipate such situations would shoulder them with the burden of presenting evidence “just in case”. Indeed, were that the case, they would be obliged to speculate as to the intentions of the trial judge and, out of fear that the judge would not respect the judicial contract agreed to, lead evidence significantly more voluminous and more onerous than otherwise necessary.

This is neither desirable nor concordant with the principle of proportionality that the parties, counsel and the court must consider. [ 75 ] In my view, this error on the part of judge merits the intervention of this Court. [ 76 ] It remains to be determined, however, whether the matter should be sent back for trial or if this Court is in a position to decide. If the evidence is insufficient to justify a refusal to homologate clause 9, the Court may indeed intervene and homologate the agreement without encroaching upon the rights of either of the parties.

If, on the contrary, the evidence suggests that clause 9 does not respect the objectives and factors set out in the Divorce Act , the Court must then return the matter for trial to allow the parties to complete their

evidence. [ 77 ] What is the case here? [ 78 ] Given that this is a first application for spousal support and not an application for variation, the judge should have considered s. 15.2 of the Divorce Act in determining whether it was appropriate to order the payment of spousal support, which she did. [ 79 ] Paragraph 4 of this

section requires balancing numerous factors: “The court shall take into consideration the condition, means, needs and other circumstances of each spouse, including (

a) the length of time the spouses cohabited; (

b) the functions performed by each spouse during cohabitation; and (

c) any order, agreement or arrangement relating to support of either spouse.” [ 80 ] The court must determine whether it is appropriate to order support and, if so, in what amount and under what conditions, taking into account all of the factors set out at s. 15.2(4) of the Divorce Act . [ 81 ] The weight accorded to each of the factors will vary according to the circumstances, and the trial judge enjoys broad discretion in weighing the factors. [6] [ 82 ] However, it is also well-established that significant weight must be given to freely negotiated agreements between the parties. [7] This weight is more substantial when the evidence demonstrates, as it did here, that the parties were assisted by experienced and seasoned counsel when the agreement was made [8] and becomes very significant when both parties request homologation of the agreement. [ 83 ] I wish to underline that it is in the interest of both the parties and the justice system that parties themselves negotiate and settle the consequences of ending their marriage, and that they should not be discouraged from doing so by the suggestion that a court may simply replace their views with its own. [9]

Section 9 of the Divorce Act acknowledges this: 9

(1) It is the duty of every barrister, solicitor, lawyer or advocate who undertakes to act on behalf of a spouse in a divorce proceeding (

a) to draw to the attention of the spouse the provisions of this Act that have as their object the reconciliation of spouses, and (

b) to discuss with the spouse the possibility of the reconciliation of the spouses and to inform the spouse of the marriage counselling or guidance facilities known to him or her that might be able to assist the spouses to achieve a reconciliation, unless the circumstances of the case are of such a nature that it would clearly not be appropriate to do so. Idem

(2) It is the duty of every barrister, solicitor, lawyer or advocate who undertakes to act on behalf of a spouse in a divorce proceeding to discuss with the spouse the advisability of negotiating the matters that may be the subject of a support order or a custody order and to inform the spouse of the mediation facilities known to him or her that might be able to assist the spouses in negotiating those matters. Certification

(3) Every document presented to a court by a barrister, solicitor, lawyer or advocate that formally commences a divorce proceeding shall contain a statement by him or her certifying that he or she has complied with this section. [ 84 ] The Supreme Court also acknowledged this in Miglin : [54] Section 9(2) of the 1985 Act clearly indicates Parliament’s intention to promote negotiated settlement of all matters corollary to a divorce.

This, coupled with the suggestive language of s. 15.2(6) and the mandatory language of s. 15.2(4) , suggests that more must be shown than mere deviation from what a trial judge would have awarded in an order before it is appropriate for the court to disregard the parties’ pre-existing agreement. Without some degree of certainty that the agreement will be respected by the court, parties have little incentive to negotiate a settlement and then to comply with the terms of their undertakings.

The policy goal underlying s. 9(2) would then be entirely defeated. [10] [ 85 ] The stability of contracts also weighs in favour of courts upholding them. [ 86 ] Courts must always ensure that the agreement reached is the result of a fair process.

However, once this determination is made, a court may not refuse to homologate an agreement – in whole or in part – except where doing so would be contrary to public order or where the result would be so unfair that the court cannot condone the agreement. [11] This could be the case, for example, where waiver of the right to spousal support would lead one spouse to be dependent on state support [12] or into an economically disastrous situation, bordering on indigence. [13] [ 87 ] Here, the judge applied the test set out by the Supreme Court in Miglin to refuse to homologate clause 9 of the agreement and to award the respondent spousal support.

First, she held that the process leading up to the agreement had been fair and implicitly recognized that, when reached, the agreement respected the objectives of the Divorce Act . Proceeding to the second step of the Miglin test, she then sought to determine whether, despite the new circumstances, the clause continued to reflect the original intentions of the parties and to substantially reflect the objectives of the Divorce Act .

On the basis of her conclusion that neither was true, she refused to homologate the agreement as requested. [ 88 ] In my view, she was wrong to do so. [ 89 ] This test was established by the Supreme Court in a context where the applicant spouse explicitly asked the court to set aside or amend an agreement. Justices Bastarache and Arbour, wrote for the majority: [2] In broader terms, the appeal raises the question of the proper weight to be given to any type of spousal support agreement that

one of the parties subsequently wishes to have modified through an initial application in court for such support. In that sense, the matter is not restricted to spousal support agreements that contain a time-limited support arrangement or to agreements which contain a full and final release from support obligations by one or both parties. [Emphasis added] [ 90 ] The judge failed to make this fundamental distinction. [14] Moreover, I do not see how to conclude that the agreement no longer reflected the intentions of the parties where they themselves both sought homologation.

In my view, the test set out by the Supreme Court is only useful where one of the parties has asked the court to set aside or modify the agreement.

This being said, many of the principles set out in Miglin remain relevant here, even if the test itself is inapplicable. [ 91 ] After having concluded that the process was fair and had given rise to an acceptable agreement, the judge should have instead determined whether the respondent’s partial waiver of spousal support was contrary to public order or if, given the new circumstances, it would render her situation so unfair that this part of the agreement could not be homologated. [ 92 ] Where the agreement is the result of a fair process, the threshold for judicial intervention in an agreement which the parties seek to homologate is high – even higher than it is when one of the parties asks for the agreement to be amended or set aside. [ 93 ] The trial judge’s reasons to justify her refusal to homologate clause 9 of the agreement suggest that she did not apply this high standard for intervention. [ 94 ] Although one of the parties may waive their right to spousal support at the time of divorce, I underscore that here the respondent did not definitively waive her right to any spousal support.

Instead, she accepted that her right to spousal support would exist only if the appellant was able to establish income similar to what he had earned in the past, namely roughly $320,000. [ 95 ] When the agreement was concluded in 2011, the respondent was earning $80,134 in employment income and her consulting business generated net revenues of $113,729. [ 96 ] The appellant had just started a business, from which he was drawing only modest income, but maintained his standard of living by drawing on his severance pay. [ 97 ] He himself waived all rights to spousal support. [ 98 ] However, the respondent’s income plummeted in 2013 due to her illness and would remain lower than that of appellant from that time on.

The judge was of the view that this was due, in large part, to the respondent’s role in the family during the time she shared her life with the appellant. [ 99 ] Knowing the role each had played, the parties nevertheless chose to settle relief corollary to their divorce by way of an agreement in which the respondent partially waived her right to spousal support. [ 100 ] It was essentially because the respondent fell ill after the agreement was made and because the requirements of her professional context shifted, making contracts more difficult to obtain, that the judge decided not to homologate the part of the agreement containing the respondent’s partial renunciation. [ 101 ] With respect for the judge, and without deciding whether these justifications would be sufficient in other circumstances, I am of the view they were insufficient here. [ 102 ] Indeed, the evidence demonstrates that the respondent’s health had greatly improved, that she was preparing to complete her PhD and that, overall, she is earning regular income. [ 103 ] Nothing in the evidence would allow us to conclude that she is in a precarious financial position. [ 104 ] Remember that the parties were both educated and counseled.

They both had high incomes at some times and more modest incomes at others. Their earning capacity continues to appear strong. [ 105 ] Overall, both of them are in very good financial shape. The appellant has net assets of $1,175,000, while those of the respondent were $1,155,039 in March 2016. [ 106 ] Without this being determinative, it is also useful to highlight that both of the parties have new companions in life with whom they live and share expenses. Moreover, both are more than adequately housed and enjoy a very comfortable quality of life.

Their children also seem to enjoy the full and rich lives that both parents offer. [ 107 ] It is true that without the marriage the respondent might have worked more and accumulated even more assets. However, the parties certainly took this into account when they settled on relief corollary to their divorce.

At least, that is what we should assume. [ 108 ] There is no violation of public order here, nor is the result so unfair that the Court should refuse to condone execution of the agreement. [ 109 ] On the contrary, in these circumstances, the parties’ intentions expressed in this agreement, intentions both of them reiterated during the proceedings by asking the court to confirm and apply the agreement, should be respected. [ 110 ] Having come to the conclusion that clause 9 of the agreement should be homologated, is it nevertheless appropriate to maintain the order against the appellant, as the respondent asks, because he was in such bad faith that it is appropriate to assume his income reached the $320,000 threshold?

[ 111 ] I believe the answer is no. [ 112 ] The judge did not conclude that the appellant’s employment income was greater than which he had declared. She increased his income for the years 2014 and 2015, but only to add part of the risk management program sale price. The calculations she made demonstrate that she was not imputing income to him – except for certain fees and expenses incurred by the business – and her analysis establishing his income leaves no room for additional income to be attributed to him.

Moreover, the evidence does not reveal that he was hiding or deliberately reducing his income to shirk support obligations. [ 113 ] In the absence of a palpable and overriding error in the judge’s evaluation of the evidence and the conclusion that she drew, there is no reason to intervene in such regard. [ 114 ] For the same reason, I would dismiss the appellant’s argument relating to the inclusion of the risk management program sale in his 2014 and 2015 income.

This was a conclusion based on the evidence heard and only a palpable and overriding error on the part of the judge, which the appellant has not demonstrated, would allow this Court to intervene. [ 115 ] For the purposes of determining whether the respondent is owed spousal support, the appellant’s income must thus be that determined by the judge for each year.

As such, his income only reached roughly $320,000 in 2015 and the respondent will have a right to spousal support for that year only, namely $2,800 gross per month. [ 116 ] It only remains to decide whether the judge had jurisdiction to order the appellant to contribute to the RESP established for the children’s benefit and to order him to assign his subscription rights to the respondent. [ 117 ] Although the appellant presents this question as being one of jurisdiction, I am of the view that this is not the case here. [ 118 ] The judge’s reasons show that she issued this order only after having determined that the appellant had undertaken to make this contribution by agreement concluded with the respondent subsequent to the agreement submitted to the judge for homologation.

As such, she was simply ordering specific performance of a contractual obligation the appellant had voluntarily assumed. [ 119 ] This is not a situation where a judge who is called to determine relief corollary to a divorce orders one or both of the parties, in the absence of a previous undertaking, to contribute to an RESP – a scenario which could raise a question of jurisdiction. [ 120 ] This being so, the judge, inadvertently, manifested her intention to vest control of the RESP with the respondent in a conclusion ordering the appellant to assign his subscription rights.

Because subscription rights generally include the right to recover capital or, depending on the regime, at least any amount undistributed at the end of the studies, I believe this conclusion was unjustified and it is appropriate only to order that the respondent manage the RESP. [ 121 ] Thus, I would grant the appeal in part, without costs given the nature of the case, homologate the agreement signed by the parties on June 18, 2011 (except clauses 19 and 20, whose exclusion was not contested on appeal), order the appellant to pay the respondent gross monthly spousal support of $2,800 for the year 2015, entrust the respondent with managing the RESP established for each of the children – without, however, requiring the appellant to assign his subscription rights – and maintain all the other orders and conclusions made by the trial judge.

As a result, there will be a substantial over payment which appellant will have the right to recover. MARIE-JOSÉE HOGUE, J.A. [3] Michel Tétrault, “La validité et la finalité des conventions : quand la Cour suprême dispose d’une question qui en ouvre tant d’autres”, in Service de la formation continue, Barreau du Québec, Congrès annuel du Barreau du Québec , Cowansville, Yvon Blais, 2014, p. 3.