M.L. v. G.L., 2015 BCSC 1107

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: M.L. v. G.L., 2015 BCSC 1107 Date: 20150626 Docket: E36112 Registry: New Westminster Between: M.L. also known as M.W. Claimant And G.L. Respondent Before: The Honourable Mr. Justice N. Brown Reasons for Judgment Counsel for the Claimant: H.M. Dale Counsel for the Respondent: T.A. Macdonald Place and Dates of Hearing: New Westminster, B.C. March 26 - 27, 2015 Place and Date of Judgment: New Westminster, B.C.

June 26, 2015 Table of Contents INTRODUCTION .. 4 1 September 10, 2012 Divorce Order 5 PRELIMINARY MATTERS .. 6 1 Retroactivity Date . 6 2 Production of Financial Information .. 6 3 Delays Providing Corporate Information .. 7 ISSUES .. 8 1 Respondent’s Income for Guidelines Purposes . 8 2 Respondent’s Recent Work History . 9 3 Financial Circumstances of the Respondent 10 4 Overview of Corporate Income . 11 5 Legal Principles for determination of Guidelines income . 13 .1 Value of services method for ascertaining Guidelines income . 16 .2 Specific Concerns Raised by the Claimant 16 .01 Travel 17 .02 Vehicle expenses . 17 .03 Amortization .. 17 .04 Retained earnings . 17

CHILD OF THE MARRIAGE ISSUES .. 22 1 Legal Principles . 23 2 Document Production Requirements and Lack of Budgeting . 24 3 Discussion .. 29 .1 Farden factors: estrangement and unilateral termination .. 29 .01 Respondent’s relationship with A .. 29 .02 Respondent’s relationship with Z .. 30 .03 Respondent’s relationship with E .. 30 .04 Respondent’s efforts to improve relationships . 32 .2 Conclusion on estrangement and unilateral termination .. 34 .3 Other relevant circumstances for child of marriage determination .. 34 .01 A .. 35 .02 Z .. 37 .03 E .. 39 4 Conclusions on child of the marriage determination .. 40 5 Child Support 40 6 Special and Extraordinary Expenses . 41 .1 Divorce Order 41 .2 Legal Principles . 42 .3 Analysis . 45 .4 Previously incurred post-secondary expenses . 46 .01 A .. 46 .02 Z .. 47 .5 Other s. 7 expenses . 47 .6 Soccer expenses . 48 .7 Tutoring expenses of E .. 51 .8 Other miscellaneous expenses . 52 .9 Other miscellaneous matters . 53 .01 Life Insurance Policy . 53 .02 Medical Dental Plan .. 54 .03 Financial Reporting . 54 FINAL FINANCIAL ORDERS .. 55 APPENDIX .. 57 INTRODUCTION [ 1 ] The claimant mother, Ms.

M.L. (also known as M.W.), seeks the following orders regarding the respondent father, Mr. G.L.:

a) a determination of the respondent’s income pursuant to ss. 18 , 19 and 21 of the Federal Child Support Guidelines , SOR/97-175 [ Guidelines ] ;

b) an order that the respondent pay the claimant basic child support pursuant to the Guidelines , retroactive to October 2012, for the support of the following children: ▪ A, born [DOB], 1992 (aged 23); ▪ Z, born [DOB], 1994 (aged 20); and ▪ E, born [DOB], 1996 (aged 18);

c) an order the respondent pay, in a timely manner, his proportional share of the children’s reasonable special and extraordinary expenses pursuant to s. 7 of the Guidelines , retroactive to October 2012; and orders for proportionate payment of the following s. 7 Guidelines expenses: (1) soccer fees; (2) soccer related travel expenses; (3) tutoring fees; (4) medical and dental expenses; (5) passport renewal expenses; (6) driving lessons and driving licensing fees; (7) specific graduation related expenses; (8) school related travel expenses; and (9) post-secondary tuition fees and books.

d) an order that the respondent produce all year-end financial statements for his business, (“VIE”), as soon as they are available; and

e) an order that the respondent maintain a life insurance policy that existed as of September 10, 2012, the date of a consent order, and provide proof of same within two weeks of a request by the claimant to do so. [ 2 ] The respondent opposes the claimant’s application for an increase in child support and for further contributions to some post- secondary expenses.

Of the s. 7 Guidelines expenses referred to above, the most controversial and costly are post-secondary tuition, books and fees, soccer fees and soccer related travel expenses. [ 3 ] The respondent agrees his income should be set pursuant to the Guidelines . He also agrees to a variation of the amount set for child support based on his actual income. He says the variation should allow for A and Z being over the age of majority. Based on their birthdates, A is now 23 and Z is 20. E is no longer a child of the marriage by age, as of August 29, 2015.

Even so, the respondent has continued to pay child support of $1,898 each month, as set by a prior order and despite his belief that his actual income has been less than the Guidelines amount. 1 September 10, 2012 Divorce Order [ 4 ] These issues are largely determinable by the divorce order the parties consented to on September 10, 2012 (the “Divorce Order”) provided that the parties would share custody and guardianship of the children, but the order provided the respondent would have reasonable access.

The Divorce Order also specified child support and proportionate sharing of the cost of named special expenses. PRELIMINARY MATTERS 1 Retroactivity Date [ 5 ] The claimant seeks orders retroactive to September 10, 2012. Counter to this, however, is the fact that the parties had inserted paragraph 4a into the Divorce Order, which provides that: Neither party shall apply for a retroactive variation of the child support amount payable between September 10, 2012 and the first Annual Income Exchange. [ 6 ] Paragraph 8 of the Divorce Order set the first so-called “Annual Income Exchange” date as July 1, 2013.

The parties say they inserted paragraph 4a at Justice Armstrong’s suggestion to ensure the parties would not have to return to court soon. The child support figure of $1,898 monthly was a negotiated one; and, in my view, it is not appropriate to extend retroactivity beyond July 1, 2013, absent proof relevant information was withheld. 2 Production of Financial Information [ 7 ] The claimant complains that the respondent interprets the ‘Annual Income Exchange’ too literally. The problem, as the claimant sees it, is that the respondent’s financial year-end is not until July.

He thus has complied literally with the Divorce Order by

providing financial statements on June 1. But this is effectively 11 months after his July 11 year end. It is not unusual to see corporate financials that do not synchronize with child support review dates. Usually, if the payor’s income in the interregnum has been higher than the Guidelines amount on which child support has been based, the payor tops up child support with a lump sum or increases the monthly amount by an amount to cover the deficit.

There is nothing inherently wrong with the current pattern because over time it works out. [ 8 ] From the respondent’s perspective, a practical difficulty with providing financial statements as soon as they are completed is that the Canada Revenue Agency (the “CRA”) reviews the statements and may reassess his income and expenses. The respondent states that he is willing to provide the statements earlier, but he cannot reliably assure the claimant or the Court that the financial statements will give a final representation of the company’s finances.

A common sense solution is to amend the Annual Income Exchange date to provide that the respondent shall provide financial information for VIE within 14 days of receiving the CRA’s Notice of Assessment.

Meanwhile, on an interim basis, the respondent can adjust child support up or down to reflect what he has filed with the CRA; and, as necessary, readjust the amounts again later. 3 Delays Providing Corporate Information [ 9 ] The respondent complains of having had to spend “endless hours” trying to respond to the claimant’s requests, which he states he found “very stressful while trying to run the business and make a go of it.” Addressing specifically the claimant’s complaints about his delay in providing requested documents, he explains he had been working mostly out of town, had moved in mid-August and it had taken time for him to set up his office and files so that he could properly respond.

Further, when the claimant’s lawyer wrote on July 7, 2014 asking for a response his counsel was away. At para. 33 he further explains: It took time to access all the information and as I couldn’t fully answer some of the questions the Claimant asked, I sought the help of my bookkeeper and accountant. I did my best to compile the requested information and receive responses from my accountant.

I had to wait for those responses and it was difficult to expedite the process due to others being on holidays. [ 10 ] After his counsel eventually compiled the information, the claimant had it by September 9, 2014. [ 11 ] I note that initially the respondent did not appreciate the scope of his reporting obligation on the financial details the claimant requested; he did not have counsel at the time, but, when retained, she explained this obligation to him, and from then on he has met them. [ 12 ] To avoid disagreements over document production and the questioning of financial reports, the claimant’s pertinent questions in a given fiscal year shall not exceed two.

The answers shall be full, open, and transparent. Both the questions and the answers shall be exchanged through the parties’ accountants. To keep accountant’s bills within reasonable limits, questions shall be limited to said maximum of two questions and one follow-up clarification. The claimant must give a reason for their requests for specific invoices and such requests must relate to producible documents and kept within reasonable limits. ISSUES [ 13 ] The issues will be addressed as follows: 1. The respondent’s income for Guidelines purposes. 2.

The status of the children (i.e. whether they remain children of the marriage for support purposes). 3. The amount of child support payable by the respondent. 4. The amount of s. 7 expenses payable by the respondent. 5.

Miscellaneous matters. 1 Respondent’s Income for Guidelines Purposes [ 14 ] For determining Guidelines income and monthly child support payable by the respondent, the Divorce Order provides as follows, beginning with this premise and proviso: AND UPON the parties being unable to agree on the Respondent’s (payor) guideline income but for the purpose of settlement only, being able to agree on a child support amount, which equates to a guideline income of $98,500, this amount being without prejudice to either party to argue a different income upon any variation application or at the Annual Income Exchange pursuant to paragraph 8 of this order commencing June/July 2013, and the Claimant (recipient) having been found to have a guideline income of $50,000. [ 15 ] The Divorce Order then provides: 4.

By consent, the Respondent shall pay child support to the Claimant for the Children in the sum of $1,898 per month commencing September 1, 2012 and continuing on the 1 st day of each and every month thereafter for so long as each of the Children remain a “child of the marriage” as defined by the Divorce Act (Canada) and this Order. [ 16 ] The following provision governs the exchange of income information: 8. By consent, the Claimant and the Respondent shall exchange their income information by June 1 each year as required by the

Federal Child Support Guidelines, being (as applicable) for each party: a. Personal income tax returns with all schedules and attachments; b. Notice of assessment/reassessment upon receipt; and c.

Corporate tax returns and Financial Statements upon completion, commencing in 2013, and shall adjust child support and the proportionate sharing of special and/or extraordinary expenses commencingJuly 1 of each year, commencing in 2013. (the “Annual Income Exchange”) 2 Respondent’s Recent Work History [17] In the two of years before the respondent incorporated VIE on July 7, 2010, his employment history was as follows: 1) At [S.E.] he earned $108,046 in 2008 and $106,872 in 2009.

He left in 2009, due to stress caused by a toxic work environment. 2) In January 2010, he started work at [C.C.] as a maintenance technician. The company offered an apprenticeship opportunity as aninstrumentation mechanic. He expected he could obtain a dual ticket as both electrician and instrumentation mechanic. However, he hadsome conflict with a senior employee and about that time. In May 2010, the claimant left the matrimonial home, taking with her theyoungest child, E. The emotional turmoil from the separation interfered with his concentration at work.

That position ended with hisprobationary period in April 2010. 3) At the time, it was hard to find work as an electrician, the Olympics having recently ended, so he went on EI. His union of 26 yearswas not dispatching due to the slowdown. 4) EI counsellors advised him that his profile suited self-employment.

Accordingly, three months after he left [C.C.] he attended a six-month training program on business concepts and skills, and on July 7, 2010, he started work as an electrical contractor conductingbusiness through VIE. [18] Although unemployed in the interregnum between working at [C.C.] and incorporating VIE, the respondent continued to paychild support based on his previous income of $80,000. To maintain his child support payments, he borrowed on his line of credit. [19] I find the respondent acted responsibly when he abandoned a salaried position and became self-employed.

In so doing, heimproved his earning potential. His earnings since July 2010 have been roughly equivalent to or better than his salaried earnings beforeseparation and there is no reasonable basis for criticism of his decision to become self-employed: see Hanson v.

Hanson (1999), 92A.C.W.S. (3d) 1024, , at para. 16 (B.C.S.C.). 3 Financial Circumstances of the Respondent [20] Until October 2011, A and Z lived with both parents, part-time; and E lived with the claimant full-time. [21] The respondent states at para. 20 of his first affidavit that it took the parties a long time to agree to his Guidelines income forthe Divorce Order because he did not know how well his business would fare due to economic trends and the fact he had never run abusiness before. [22] The claimant argued for higher Guidelines income than stated in the Divorce Order based on figures projected in a business planthe respondent had prepared before VIE started operations.

One of the children found the business plan on a laptop he used. The planprojected higher earnings than he has so far achieved. The respondent explained he wrote the business plan as an integral part of the self-employment program he enrolled in after he lost his salaried position.

At paras. 21and 22, he explained that the revenue and expensenumbers “weren’t factual but a guess at the best case scenario I hoped for my business in the future,” and the business plan was “notrealistic nor even a close representation of the company’s actual revenues”. [23] The respondent is a journeyman electrician, a union member for over 26 years. He pointed out his company pays him at thehigher union rate payable for an “A” foreman, $43.73 hourly, as opposed to the standard union rate as of April 1, 2014 for a person withhis experience, $36.44 per hour, which is what he earned at [S.E.].

He explained the higher rate more accurately reflects his experienceand reflects the value of his labour to his company. He further calculates that 130 hours monthly at an “A Foreman” union rate equatesto annual income of $73,903.70. In addition, for the past two years his company has paid a taxable dividend of $20,000 annually, whichbrings his total income to $93,500. (This figure also includes some interest income.

For tax accounting reasons, the $20,000 dividendshows as $10,000 in the company’s financial statements). [24] The health and welfare benefits available to him through his union include medical dental benefits for the children at a monthlycost of $273. This rate is calculated based on a rate of $2.10 an hour and 130 hours of work. [25] The financial records available at the hearing do not show the most recent dividend(

s) paid. They do show the followingrevenue, gross profit, expenses, pre-tax income, net income and retained earnings for the 2010 to 2013 year-ends. 4 Overview of Corporate Income [26] [See the Chart on the next page.]

Note: 2013 wages and benefits include $90,639 for the Respondent; the balance is for arm’s-length wage earners. 5 Legal Principles for determination of Guidelines income [ 27 ] In K.S.F. v. S.M.F , 2011 BCSC 1563 , I reviewed case law on the subject of determination of total income under the Guidelines . [37] … Usually, the total income of a spouse in a given year can be based on the “Total Income” a spouse reports in their T1 General Tax form issued by CRA: Guidelines , s. 16.

But if a spouse’s pattern of annual income shows this would not be the most fair and reasonable way to fix Guidelines income for support purposes, the judge may consider fluctuations in a spouse’s income over the previous three years.

The judge can also consider nonrecurring income during that three-year period and fix an amount the judge finds proper: Guidelines , s. 17(1). [38] If the effects of a nonrecurring capital or business loss do not give a fair picture of a spouse’s annual income, the judge may impute an amount for total income they find proper: Guidelines , s. 17(2). [39] If a spouse is a shareholder of a business … and the judge believes a spouse’s T1 “Total Income” does not fairly reflect all the money available to the spouse to pay support, the judge may consider the spouse’s income pattern over the previous three years: Guidelines , s. 18(1). [40] The judge can also include in the spouse’s total income all or part of the corporation’s pre-tax income: Guidelines , s. 18(1)(a).

Alternatively, the judge may fix an amount that agrees with the services the spouse provides the corporation, so long as the amount does not exceed the corporation’s pre-tax income: Guidelines , s. 18(1)(b).

[41] Unless the spouse shows that all amounts for salaries, wages or management fees were reasonable in the circumstances, s. 18(2)of the Guidelines requires the judge to add those amounts back to pre-tax income of the corporation. [28] Further, more specifically on the subject of pre-tax earnings and retained corporate earnings, the following authorities werenoted at paras. 43 - 47: [43] In Kowalewich v Kowalewich, 2001 BCCA 450, 92 B.C.L.R. (3d) 38 [Kowalewich], Huddart, J.A., writing for the Court, statedat paragraph 40 that a judge should not look only to the value of a spouse’s pay or their services to the company they own or control.

Atparagraph 42, she explained the purpose of the Guidelines is ... to permit an impartial assessment of "money" available to a spouse to pay child support. They are not just about actual income as aparent directly or indirectly determines it to be. [44] Huddart J.A agreed at para. 43 of Kowalewich with comments Justice Martinson made in Baum v. Baum (1999), (BC SC), 182 D.L.R. (4th) 715, 7 R.F.L. (5th) 231 (B.C.S.C.), at para. 28: [28] Valid corporate objectives may differ from valid child support objectives.

The purpose of s. 18 is to allow the court to "lift thecorporate veil" to ensure that the money received as income by the paying parent fairly reflects all of the money available for thepayment of child support.

This is particularly important in the case of a sole shareholder as that shareholder has the ability to control theincome of the corporation. [Authorities omitted]. [45] However, a judge tasked with determining a spouse’s total income under the Guidelines can consider the value of a spouse’sservices to the company; sometimes, this will be a fairer basis for doing so: Kowalewich, at para. 65. [46] But in a case such as this, where the husband exercises total control over AGB’s finances and where the wife’s continuing partialshare ownership is an immaterial consideration because she had no financial control at all, I should focus on the total income thehusband had available to him to pay child and spousal support.

To determine his total annual income, I should therefore consider pre-taxcorporate income, non-arms length transactions without value to the company, inappropriate expensing and any other unjustifieddiversions … that effectively deprived [the child] or the wife of the support they were entitled to: Kowalewich, at paras. 48-50. [47] For child support, Huddart J.A. stated at paragraph 45 of Kowalewich that to determine whether a spouse’s “Total Income” fairlyreflects money available for child support, a court might ask ... what an objective well-informed parent would make available for child support in the circumstances of a particular business overwhich the parent exercised control, having regard to the objectives of the Guidelines, the underlying parental obligation to supportchildren in accordance with one’s means, and any applicable situation in s. 17. [29] I then considered how much pre-tax corporate income should be incorporated into the payor’s annual income at paras. 48 - 49,51 - 54 and 58: [48] Pre-tax corporate income often represents an “owner’s entrepreneurial capacity and investment” and a source of income “anintact family would utilize”: Kowalewich, at para. 48.

But this is not always so. As Huddart J.A. noted, a court’s effort to ensure fairnessdoes not require it to second-guess business decisions, but to make a fair assessment of how to share income for family and businesspurposes: Kowalewich, at para. 44. This test requires a judge to consider evidence of legitimate business calls on pre-tax income beforeincluding an expense in corporate pre-tax income: Kowalewich, at paras. 58-59. [49] Neither the pre-tax profit of a company nor its losses are automatically included in annual income. The Guidelines allow, but donot require inclusion.

Inclusion is not the default position: Kowalewich, at para. 54. … [51] Referring to findings made by the two different judges presiding below, Huddart J.A. stated that money the spouse needed tomaintain the value of the business as a viable going concern would not be available for support purposes and should not be included indetermining annual income: Kowalewich, at para. 58. She also noted that in Hollenbach v Hollenbach, 2000 BCCA 620, the trial judgerecognized it was a legitimate business purpose for a real estate business to set aside a reserve for depreciation.

In addition at para. 60,she noted the parties had not asked the accountants giving evidence for their opinions on the company’s need to finance a plannedexpansion. [52] Dorgan J., one of the trial judges hearing Kowalewich, canvassed several categories of business purposes she thought werelegitimate in that case. These were noted at para. 61 of Kowalewich. They included: a reasonable salary for management; an adjustmentfor a store closure; money needed for expansion; depreciation; economic downturns; and a return on the paying spouse’s capitalinvestment. Huddart J.A. did not criticize the categories.

She found, however, that the trial judge had attributed too much of the pre-taxcorporate income to Mr. Kowalewich’s income: Kowalewich, at para. 62. [53] The pattern of pre-tax income in a small business … can rise and fall for any number of reasons, ranging from souring economicconditions to strategic accounting for tax purposes. A responsible owner of a business dedicated to selling and installing auto glasswould likely need to reserve against economic slowdown and declining sales; as well as for deferred maintenance, depreciation, andpossible tax liabilities.

The owner, looking at all their information, including fluctuations in sales and earnings, has to make sure thebusiness can continue operating in the future. This obviously indirectly benefits not only the company, but also a spouse or child eligiblefor support. [54] In sum, Kowalewich confirms a judge should not make an order that prevents the paying spouse from running their business asprofitably as possible, or that prevents them from making good business decisions. But the owner spouse must state business income andallocate expenses honestly and transparently.

Expenses must be reasonable and for legitimate business purposes, considering all the

circumstances. The reasonable needs of a child and spouse entitled to support must be balanced fairly against legitimate business calls on pre-tax corporate income. If the paying spouse fails to so act, the court will see to it. … [58] I note as well that in Kowalewich , neither the Court of Appeal nor the judges at trial had much in the way of specific or clear evidence on business purposes before them. Some findings can rest on evidence about the nature of the business and judicial discernment of the capital needs of the business. [Emphasis added.] [ 30 ] In Reis v.

Bucholtz , 2010 BCCA 115 at para. 48 , Justice Groberman held the paying spouse bears the onus of establishing that pre-tax corporate income is being kept by the company for business purposes on the civil standard of a balance of probabilities. The evidence in support should be clear: Jeffery v. Motherwell , 2006 BCSC 140 at para. 13 . .1 Value of services method for ascertaining Guidelines income [ 31 ] A judge tasked with determining a spouse’s total income under the Guidelines can choose to consider the value of a spouse’s services to the company as a benchmark for Guidelines income.

In fact, sometimes the value of the payor’s services to the company is the fairest way to determine Guidelines income: Kowalewich at para. 65 . In this case, the respondent’s current Guidelines income is about $20,000 higher than the value of his services compared to what he would earn as a salaried employee. In this case, were the Court to use the “value of services” method, the Guidelines income amount would be considerably lower. In addition, the respondent performs many hours of unremunerated administrative services.

If the company hires a manager, which likely will be necessary to allow the company to expand and free up time for the respondent to pursue more contracts, company expenses will increase. In the longer term, if the respondent is able to win more contracts, increased income would improve the bottom line. What is most noteworthy now is that the respondent’s valuation of the value of his labours is fair to the claimant. .2 Specific Concerns Raised by the Claimant [ 32 ] At this juncture, the respondent has made adequate financial disclosure.

The only line items now challenged by the claimant are: 1) travel of $3,912; 2) vehicle expenses of $10,357 for 2012; 3) amortization at $21,770 for 2012; and 4) corporate retained earnings, which as of 2013 stood at $91,912, after a llowing for a $16,500 dividend. .01 Travel [ 33 ] As for travel expenses, VIE bills these to the customer if the customer agrees to pay for them. The respondent works a lot in northern British Columbia. When the client pays expenses, they are included in the company’s income.

I see no reason to add travel expenses to the respondent’s Guidelines income. .02 Vehicle expenses [ 34 ] The respondent does not own a vehicle for personal use. As noted, he often works out of town. When he needs a car at home, he uses his wife’s car.

Expenses incurred for gas, repairs, maintenance and bridge tolls are all business related. .03 Amortization [ 35 ] As for amortization, this is a proper deduction, reflecting the depreciating value of equipment that is necessary to earn income and that in future will have to be replaced. .04 Retained earnings [ 36 ] At para. 35 of his first affidavit, the respondent deposes that retained earnings allow him to fund the purchase of necessary business assets and support further business development.

He has also learned lenders expect healthy retained earnings because these show them that the business is healthy and financially viable. [ 37 ] The respondent’s 2013 application to Vancity for a business loan was declined. The respondent pointed to a letter from Vancity dated June 5, 2013 that declined a loan because “the company’s financial position, with declining revenues and income and minimal retained earnings was not sufficient to borrow money.” (The letter, purportedly marked as “E” and attached to the affidavit was missing from the Court’s copy of the materials.

If missing from the original documents filed, it needs to be filed.) [ 38 ] In a letter dated September 9, 2014, counsel for the respondent responded to counsel for the claimant’s questions about retained earnings as follows: This does not mean there is that amount of money in the bank that can be spent. Most companies have retained earnings because it allows the company to fund the purchase of assets and the growth of the company with corporate tax paid dollars that are @ 86.5 cents.

Additionally, it provides companies with funds and stability should there be a downturn in the economy or should the company struggle. In addition, there are assets such as field testing equipment that are considered company assets that cannot be written off all at once. For example, there could be $50,000 worth of equipment that has been purchased but only $10,000 per year (depreciation) can be written off. Therefore, the retained earnings may show $91,912 but the available funds may only be $41,912. This is an example only . There are many things that affect retained earnings and money in the bank.

[Emphasis in original.] [ 39 ] The respondent expands on these points in his first affidavit at paras. 37 - 41 and 49 - 53 as follows: 37. Without a line of credit, I was unable to purchase equipment I needed to take on projects. If that situation continued, the future growth of the company would be affected. 38. The retained earnings also provide a buffer / stability so there are available funds if there is a downturn in the economy, a lack of work or I am unable to work for any reason. 39.

With self-employment there is a risk and I must secure at least 12 months wages so I can continue to meet my liabilities, expenses and child support payments. I have no ongoing commitments with clients that guarantee me income. I work from job to job on a contract basis. 40. I have made practical decisions for the business to keep it viable. I have managed company revenues to pay back loans, acquire test equipment and maintain payroll, along with company operating funds. I am very conservative with spending. I justify any expense before spending money. 41.

The amount of the retained earnings is affected by various factors. First, a portion of the retained earnings is represented as my pension plan contributions. Second, there are retained earnings from vehicle revenue that is accruing, not only for running the van, but for the eventual purchase of a new vehicle when required. In 2012/2013, rent was not charged in order to assist with building up the retained earnings for the purpose of credit financing from the bank. Any other retained earnings are based on profit after all the expenses are paid. … THE BUSINESS 49.

I have operated VIE with very conservative expenditures and low overheads in order to become a viable company. This is still a work in progress. Currently, all my equipment storage is in an unheated barn and in the company van. 50. In order to make this company viable, I have started it on organic growth by earning revenues and contributing these revenues to the acquisition of equipment and company expenses. I choose not to go into debt for equipment, but rather earn the money and then spend it on equipment required for my jobs.

I do not have constant work coming in where I can guarantee making payments on loans for equipment purchases. 51. If I don’t have the equipment, I am forced to rent it which adds additional cost to the jobs potentially making my quotes less competitive. 52. I am still a long way off to obtaining a place of business with a fully functional company, including office staff. I spend immense hours completing all functions for company operations, including quoting, execution of the jobs, preparing reports and billing. 53. I am still a one-man operation but I am at a point that I can’t continue doing it all.

I am under considerable stress having to manage every aspect of the business. I am under extreme pressure to make the business work. Part of that pressure comes from the Claimant who expects me to pay more. I feel anxiety each time I receive an email from the Claimant. She is constantly demanding money or dictating to me what I am to do. I am doing my very best and cannot do anymore. I am driven to have this business succeed and intend to do so.

I just wish I wasn’t so pressured and stressed in doing so. [ 40 ] At para. 54, the respondent explains his dyslexia, and how hard it is for him to finish paper work. [ 41 ] At paras. 55 - 58 and 60 - 63, the respondent expands further on the importance of the retained earnings to his business and the uses to which they have to be put: 55. I have made every effort to have VIE get off the ground and be a functioning company. I spent endless hours working on all aspects of the company for which I do not get paid.… I have taken only minimal time off in the past few years. 56.

In order to be an electrical contractor I have to take on jobs that require financing, employees and/or sub-contractors to support the projects. If there are no retained earnings and the bank will only lend a limited line of credit, I am faced with having to build up the company cash flow in order to execute jobs. The cost of equipment, employees and sub-contractors can add up to several thousands of dollars and many times when the projects are complete, the invoicing is not paid within the anticipated 30 days. There seems to be a standard minimum 45 days to 90 days for payment.

This is further justification why retained earnings are necessary to support all operations of the company. 57. I intend to make a move from the unheated barn where my equipment is getting damaged due to mold to a true place of business where I can have an office, warehouse and storage space, like most contractors. This requires a large financial commitment, whether I rent, lease or purchase. Retained earnings are necessary and an ongoing requirement in each and every financial year for future growth of the company’s operations.

The retained earnings for VIE are conservative and in line with industry standards. 58. I store my equipment in my dad’s barn. He intends to sell his property in the spring 2015, further necessitating the requirement for a place of business. … 60. I still do not have a line of credit and intend to re-apply in the near future. After two years of proving viability with retained earnings, I believe I am in the position to satisfy the bank requirements for a line of credit that will allow me to grow the company.

61. Electrical contracting is a very competitive business and there is a requirement to have a proper place of business and equipment in good working order so I can execute the jobs proficiently. I have done my very best with the knowledge and skills I have to get where I am today. 62. In the past year, there has been a down turn in the economy with several electrical businesses cutting back and/or struggling to be viable. The work just isn’t there as it has been. I have found more opportunity working out of town on select projects to build my business.

My company is not of the size or capacity at this time to take on any large projects due to the lack of equipment, capital and personnel. 63. In her affidavit, the Claimant attached an invoice indicating that VIE made in the range of $20,000.00 in one month. That was a rare occurrence in 2010 where I was sub-contracting for a contractor working on a large start-up mining project requiring immense amounts of overtime in a short period of time.

I have not been involved in a project like that since. [ 42 ] VIE appears to be viable, but to maintain viability it will need capital to purchase new and replacement equipment, storage facilities, and some outside office management, especially if the respondent is to find time to widen the scope of geographical locations, type and complexity of projects the company undertakes. Such business expansion would likely strengthen the company’s finances and help fence out market vagaries. Otherwise, as a young company, VIE will remain financially vulnerable.

VIE’s retained earnings at a given time are subject to legitimate business calls and the amount recorded is not necessarily representative of freely available funds. [ 43 ] The cases recognize what might be characterized as the “deft touch” a judge must use when dealing with small businesses and their retained earnings. Usually, owners know their businesses better than anyone else. They are more attuned to the competitive forces and economic vagaries it faces, the capital it requires, and the foreseen or foreseeable expenses it will incur.

The payor carries the burden to prove the business legitimacy of expenses and retained earnings. But as Huddart J.A. noted in Kowalewich , a court’s effort to ensure fairness does not require it to second-guess business decisions; rather it must fairly assess how to share income for family and business purposes .

In turn, this requires the court to consider evidence of legitimate business calls on pre-tax income before including an expense in corporate pre-tax income: Kowalewich at paras. 44 and 58 - 59 . [ 44 ] As noted earlier, Baum reminds us that valid corporate objectives may differ from valid child support objectives and that the purpose of s. 18 is to allow the court to “lift the corporate veil” to ensure the payor’s stated income includes all money available for the payment of child support.

Of course, “all of the money” is not equivalent to whatever might be the current figure for retained earnings on a balance sheet at a given time. That acknowledged, the children of a marriage are a parent’s primary responsibility. Their financial needs can become a greater priority than, say, growing the company. The nature and extent of that priority is a matter of balance and proportion.

The court’s role is to assess the circumstances as would a reasonable parent informed of all pertinent financial and personal facts. [ 45 ] In this case, I find the respondent has established on a balance of probabilities that VIE, a relatively new business must retain earnings to, among other things, properly manage business fluctuations, float the company during times of illness, fund necessary equipment purchases, and cover deferred or otherwise pending and anticipated expenses, as detailed in the respondent’s affidavit and the letter from counsel, attached as Exhibit “E” to the respondent’s first affidavit. [ 46 ] These are legitimate business requirements.

The current figure for retained earnings does not represent an uncommitted pool of income that can be drawn down for non-business purposes as if the respondent faced no constraints, or as if VIE’s earnings and productivity would not see any negative impact. [ 47 ] In this case, the children’s call on retained earnings is not for the necessities of daily living; rather, it is almost all for s. 7 expenses. The respondent has continued to pay basic child support for three children, two of whom are adults, who are either working or attending school.

Such circumstances moderate the forcefulness of calls on the retained earnings. [ 48 ] I fix the respondent’s annual Guidelines income at $105,000 . CHILD OF THE MARRIAGE ISSUES [ 49 ] Child support and amounts for special and extraordinary expenses are only payable for a “child of the marriage”. This term is defined in the Divorce Act , R.S.C. 1985, c. 3 (2 nd Supp.) [ DA ]. The Divorce Order provision relating to the children’s status as children of the marriage states: 5.

By consent, upon attaining the age of 19 years, each of the Children shall remain a “child of the marriage” for so long as they: a. are eligible for support pursuant to the Divorce Act (Canada); b. are in full-time attendance at a recognized post-secondary institution; and c. maintain reasonable passing grades unless there are circumstances that prevent this. [ 50 ] The Divorce Order thus establishes threshold requirements for entitlement: full-time attendance at a recognized post-secondary institution and maintenance of reasonable grades, unless circumstances prevent this.

These are minimum threshold requirements and do not create an automatic parental obligation to pay all the children’s tuition and book expenses. [ 51 ] A and Z are both over the age of majority. It falls on the Court to determine if either or both of them remain children of the marriage for support purposes. 1 Legal Principles

[52] A child’s entitlement to child support arises on both the initial application and on variation hearings: Shelley v. Russell, 2012ONSC 920. The onus is on the party seeking support to prove the child is still a child of the marriage at the time of the application and soentitled to support: Shelley at para. 34; Geran v.

Geran, 2011 SKCA 55 at paras. 11 - 13. [53] Children who attend a post-secondary institution are frequently considered a child of the marriage under s. 2(1), because thepursuit of an education necessary to equip a child with a career qualifies as an “other cause” within the meaning of the definition of“child of the marriage”: Martin v. Martin (1988), (BC CA), 26 B.C.L.R. (2d) 390 at 393 (C.A.); Neufeld v. Neufeld,2005 BCCA 7 at para. 18. Mere attendance at an institution, however, is insufficient grounds for child support.

The Court needs toconsider all the relevant surrounding circumstances: Neufeld at para. 18. [54] In Neufeld at paras. 19 - 20, Madam Justice Levine noted the factors that Master Joyce (as he then was) formulated in Farden v.Farden (1993), (BC SC), 48 R.F.L. (3d) 60 (B.C.S.C.) to assist in the assessment of whether a child who is pursuingpost-secondary education remains a “child of the marriage”.

Levine J. outlined the factors as follows: [20] The factors outlined in Farden are: (1) whether the child is in fact enrolled in a course of studies and whether it is a full-time or part-time course of studies; (2) whether or not the child has applied for or is eligible for student loans or other financial assistance; (3) the career plans of the child, i.e. whether the child has some reasonable and appropriate plan or is simply going to collegebecause there is nothing better to do; (4) the ability of the child to contribute to his own support through part-time employment; (5) the age of the child; (6) the child's past academic performance, whether the child is demonstrating success in the chosen course of studies; (7) what plans the parents made for the education of their children, particularly where those plans were made during cohabitation; (8) at least in the case of a mature child who has reached the age of majority, whether or not the child has unilaterally terminated arelationship from the parent from whom support is sought. [55] Not all of the factors need to be present to establish a child remains a “child of the marriage; these factors are not exhaustive andnot a checklist, rather, practical useful matters to consider when determining if the child’s situation is consistent with the definition of“child of the marriage” in the DA: Nordeen v.

Nordeen, 2013 BCCA 178 at para. 17. [56] Other factors in this case that are relevant to determining whether A and/or Z remain children of the marriage include: the termsof the Divorce Order, which circumscribes entitlement with conditions; the parties’ pre-separation ability to save $30,000 for post-secondary education; the fact there are three children simultaneously seeking support for post-secondary costs; the fact all three childrenlive at home; and the fact the payor has continued to pay basic Guidelines child support. [57] In this case, the parties saved $13,000 for each child.

Logically, this would represent the most they could achieve when stillmarried. Here, three children at roughly the same time are seeking financial support to further their post-secondary educations.

Thisobviously poses more of a financial challenge to the parties than does one child who needs support and would call for more planningand, common sense suggestions, a higher level of contribution from each child. 2 Document Production Requirements and Lack of Budgeting [58] Before determining whether the children remain children of the marriage for support purposes, I have some comments on thecontent of the claimant information provided to the respondent and the Court. [59] Firstly, I note that on an application for child support for an adult child attending a post-secondary institution, the child shouldsupply evidence of their career plans, anticipated time for completion, particulars of employment, student loans, applications for loansand bursaries, and living arrangements: Gasparini v.

Gasparini, 2014 BCSC 1465 at para. 30; Naylor v. Naylor, 2012 BCSC 1450 atpara. 3. The claimant’s information falls short in some of these areas. [60] In this case, the consent Divorce Order obligates the claimant and the children to provide the respondent with the followingdocumentation:

a) confirmation of enrolment by September 1 and January 1 of each year, and any other sessions attended;

b) documentation for any change of enrolment immediately upon the change occurring;

c) copies of all transcripts of grades immediately on receipt; and

d) receipts for tuition and book expenses; [61] Compliance with these obligations has been spotty. [62] Perhaps most notably lacking in this case is any affidavit from the children. In some cases, such affidavits may not be necessary,especially when there is ample relevant information already available to the parties. The respondent has directly requested someinformation from the children without, in some instances, receiving a meaningful response. In fairness to the claimant, she has provided

the respondent with considerable information when requested, but, some of it after the fact and without her having sought the respondent’s views. [ 63 ] Paragraph 7(

b) of the Divorce Order classifies tuition and book expenses as s. 7 expenses. Paragraph 7(b)(ii) requires the parties to take into account “each of the Children’s contributions to their post-secondary expenses through scholarship , student loan , or employment monies ” when determining their agreed proportionate share of those costs. [ 64 ] Preparation of a budget is an essential ingredient of determinations made under s. 3(2) (

b) of the Guidelines ; but also in a case like this, where the child is expected to contribute to their educational expenses through employment income, bursaries, and scholarships, where eligible, and particularly where, as here, the parties have not stipulated a specific amount or percentage they are obliged to contribute to tuition and books, preparation of a budget is just as necessary.

Post-secondary education costs become a major line item in most family budgets and even more so for separated parents, who have to maintain two households, more reason to confer and present budgets with all the required information. [ 65 ] Preparation of a budget consists with the expectation that the payor parent receive sufficient documentation on the child’s schooling, confirmation of employment, reports, grades, transcripts, or other materials the school ordinarily issues, together with any employment income information. [ 66 ] Payors, recipients, and adult children seeking support from a parent for their post-secondary education must show good faith and transparency: B.L.S. v.

E.J.S. , 2014 BCSC 1549 at para. 51 . [ 67 ] As noted in Geran , the budget of income and expenses need not be

an act of “precision”, but it should: [76] ... be prepared with attention to detail, supported to the extent reasonably possible, and should reflect an honest and realistic estimate of the actual or anticipated state of affairs. Otherwise, judges are left with little choice but to do the best they can on the basis of what seems reasonable in one respect or another. This is especially so because of the often prohibitive cost of engaging in a viva voce hearing, or even of cross-examining on the affidavits. [ 68 ] Again, a budget is not essential in the same way it is where s. 3(2) (

b) of the Guidelines is being applied, but it is still a step necessary for fair determination of the parents’ total contributions to tuition and books. It gives the parties, not to mention the court, an empirical basis for determining what portion of the total costs for books and tuition the parents ought to contribute (in proportion to their respective incomes).

This is especially necessary where a parent, as here, has paid and continues to pay basic Guidelines child support, where there are RESP funds to be apportioned between three children, where the children are employed, and where the parties are required to pay proportionate amounts to a specific class of expenses, in this case, books and tuition.

Without a percentage being assigned to the parents and to the child, the court is left with no signposts to show what portion of reasonable books or tuition expenses they must proportionately bear. [ 69 ] Where children seek a financial contribution from their parents for post-secondary education and the post-secondary institution the child wishes to attend has been identified, the parties should consider costs and sources of income:

a) whether the child plans to attend full-time or part-time;

b) how long the child will need to attend to complete the planned program;

c) career plans, and to what career, if any, the child expects the program to lead towards;

d) costs of books required, annual tuition, student fees, parking fees, transportation costs, and living expenses;

e) the child’s earning capacity, either while attending full-time or part-time, and their employment plans;

f) whether the child has found employment and their present and potential earnings;

g) potential income sources from other family members other than their parents;

h) other potential financial resources, such as RESP’s, bursaries, scholarships, and student loans;

i) other extra-parental financial resources;

j) where the child will live, and, if at home, whether child support payments will continue;

k) if the child will live with recipient spouse, whether the child will contribute to living expenses; and

l) the availability and cost of family or institutional medical dental plans. [ 70 ] Such information facilitates preparation of a budget. It should contain specific figures for the above line items, including bursaries and scholarships for which the child is likely eligible, or at least set out a reasonable expectation for them.

It should include what portion of any RESP or other educational funds for which the student is eligible for and what student loan amount they qualify for. [ 71 ] This planning process requires thought, care and discussion; and transparency, to minimize the chance of surprises and misunderstandings. [ 72 ] After the essential information has been drawn together, the parties should have in hand a budget that shows any shortfall remaining that will require parental contributions.

If the budget shows that the RESP funds, bursaries, earnings, scholarships, and other sources of monies that are available to the child would cover their educational expenses, this does not mean that the payor parent should be automatically relieved of any contribution. But the budget should give the parents and the child a decent view of what the child’s

expenses will be, and allow them to see and discuss what proportion, overall, they should reasonably contribute to (in this case, tuition and books). Alternatively, they can simply settle on a proportion and proceed from there. [ 73 ] If the budget information shows, for example, that the child plans to work too much and that this would be detrimental to their education, or that student loans are becoming an excessive portion of the total budget, the parents’ contribution should reflect that.

If the parties have prepared a budget, they will find themselves well positioned to see what reasonable percentage of tuition and book costs they can afford to contribute in the year forthcoming and in successive years. [ 74 ] Doing the work of preparing a decent budget is a far better use of the parties’ resources than is writing and assembling hundreds of pages of affidavit material after the fact. 3 Discussion .1 Farden factors: estrangement and unilateral termination [ 75 ] Much of the parties’ materials deal with how the children’s relationship with their father has deteriorated since the parties separated.

A child’s unilateral termination of relationship may end a parent’s obligation to financially support a child’s secondary education. [ 76 ] At para. 100 of his affidavit, the respondent deposes his relationship with the children became strained after the parties separated. After E and the claimant moved from the family home E “wanted nothing to do with [him]”. A and Z continued to live with him part-time, until October 2011.

Since 2011, the respondent deposes he has had limited contact with his children: with A, four times in 2011 at his request; at Christmas 2011, with all three children; at Christmas 2012, A and Z visited the paternal grandfather’s house for Christmas; in February 2012, A and Z visited the paternal grandfather for his 75 th birthday; at Christmas 2013, A and Z visited the respondent; and in August 2014, A and the respondent had lunch with him. .01 Respondent’s relationship with A [ 77 ] Other than the contact outlined above, the respondent states he used to stop by A’s workplace to visit.

November 21, 2014, being the last time, after A sent him a text not to come by there again. [ 78 ] The respondent complains A has failed to give him information he requested about her schooling, such as her grades and tuition costs. The claimant’s explanation for this is that A thought the respondent’s demands were unreasonable and that these requests had hurt and frustrated her. .02 Respondent’s relationship with Z [ 79 ] Z graduated from high school in June 2012. The respondent maintains he was not involved in her graduation planning.

He also states he did not receive advance information about her attendance at Kwantlen College or what her career aspirations were at that time; except for mention she had nursing aspirations. At para. 112 of his affidavit, he deposes he was not included in discussion about those decisions and that he was never informed Z intended to attend Stenberg College, only learning about it indirectly in 2014 through a request for information for a medical insurance plan that indicated showed Z’s registration at Stenberg College. While enrolled there, Z took on a $24,000 student loan.

The respondent learned of the loan when Z registered at Stenberg College from his reading of the claimant’s September 23, 2014 affidavit. But in April 2014, he had received a transcript of Z’s Stenberg College grades. He also acknowledges receipt from the claimant of a July 17, 2013 email stating that Z wanted to be a nurse, either an RN or an LPN, but that due to waiting lists she might have to take some transferable credit courses. [ 80 ] The poor communication on Z’s post-secondary activities itself reflects significant estrangement between Z and the respondent.

Z failed to share with the respondent the most basic information that one would expect of a child expecting their parent’s financial assistance. .03 Respondent’s relationship with E [ 81 ] As for E, the respondent deposes contact with her has been minimal. As an example of the respondent’s limited contact with her, the respondent states that when he learned of a parent-teacher gathering in September 2013 at what he understood at the time was her secondary school, he attended, only to learn after the meeting that E had transferred to another school.

The respondent deposes at para. 103 of his affidavit that he was “shocked” to learn of this and that the claimant had not informed him of the change. The claimant explained E had changed schools on a trial basis and ended up attending two schools simultaneously in her Grade 12 year.

She deposes she intended to advise the respondent once it became apparent whether the arrangement would work for her. [ 82 ] A relevant side-note to this event is the fact that when E learned her father had been to her school, she sent him an admonishing text message, telling him she did not want him to attend her school, to ask any questions, or to be in her life. At para. 104, the respondent states he was “devastated”, but hoped if he showed E that he was “there for her, she would come around”, but that has not happened. [ 83 ] He has sought counselling with E but she has expressed no interest.

The claimant deposes the contrary and I can make no finding either way, except to that the respondent wishes to maintain a relationship with E. [ 84 ] At para. 106, the respondent notes that when E graduated from high school in June 2014, neither she nor the claimant informed him about either her graduation plans or future school plan. He sent $500 to contribute to graduation expenses, but the claimant criticized this as inadequate. Although E told the respondent she preferred that he not attend her graduation, he did. They spoke and she posed amiably for a photograph with him.

The respondent deposes that he believes that the claimant does not support the development of a

healthy relationship between him and E, but the evidence does not go that far. [ 85 ] The respondent further deposes that before E enrolled at the University of British Columbia (“UBC”) in 2014; neither she nor the claimant consulted him on her post-secondary planning or advised him that she was eligible for an annual $2,000 soccer scholarship. As for documentation, he complained that as of December 2014 the only documentation he has received was E’s course outline and her Grade 12 marks.

The respondent’s counsel also noted the claimant’s second affidavit did not update this with more current information until the hearing, and that it was incomplete. [ 86 ] The claimant did, however, advise the respondent on April 29, 2014, that E had been accepted into UBC. She also advised the respondent of graduation plans and asked for his contribution, which he evidently did make. As for acceptance into UBC, the respondent acknowledged this in an email to the claimant, stating in part: It’s wonderful to hear that [E] has been offered a spot on the UBC team, I’m sure it will be a great experience for her.

Thanks for letting me know. For [E] to earn a spot on one of the nation’s top CIS teams and to play for a team coached by [a top coach] … is an accomplishment in itself. To be accepted into the 31 st ranked university in the world is another. Personally, I couldn’t be prouder. .04 Respondent’s efforts to improve relationships [ 87 ] Apart from his specific relationship with each child, the respondent, speaking now more generally about the children’s estrangement, deposes that despite his best efforts they have remained distant and uncommunicative.

The supporting evidence, contained mostly in text messages, considered as a whole, supports this statement. In A’s case, the respondent points to a sampling of text messages inviting her to meals, including one on Father’s Day. They were generally either ignored, or either curtly or only partially answered. When he extended an invitation to the children to join him for a Father’s Day dinner in 2014, they declined.

He later learned that they had been at a Father’s Day dinner with the claimant, as evidenced by a Facebook photograph of the claimant and the children, captioned with words stating, in essence, that the claimant was the real father of the family. [ 88 ] The respondent denies he has distanced himself from the children and challenges the notion of the claimant’s statement that she is responsible for every detail of the children’s lives, considering they are adults. He insists he has made repeated attempts to connect with A and Z, which the text messages mostly show.

He expands at para. 11 of his affidavit #2(#3), unfiled, dated March 23, 2015: 11. I continue to ask them to get together with me and tell me what is going on in their lives. Their responses have been none at all or very limited. It is rare that I get together with them because they will not commit to a time to meet me.

Most times when I ask for more information for clarity from the Claimant, she seems to respond with inflammatory degrading responses by email/text as this is the only way the Claimant will communicate. … Furthermore, I was under the understanding that I would be involved in the decision making process of each child when it came to significant decisions. This has never happened since we’ve separated and divorced. [ 89 ] At para. 102 of the respondent’s first affidavit, he states as follows: 102. I am distraught about the situation with my relationship with the Children.

I have sought counselling to understand why there is a problem and how to address it. Despite counselling and more understanding, I still feel a great loss. I was very involved as much as I could be despite a heavy workload when we were all together as a family. I make every effort to keep up the communication with the girls by texting, leaving phone messages and stopping by work. I have let them know by text that the door is always open and it is my hope to have a good, meaningful relationship. [ 90 ] It is not as if the respondent previously had no relationship with the children.

He explains at para. 99 of his first affidavit that he always been an involved father, “attending school and club soccer practices and games.” He further deposes that he “assisted and/or coached A’s soccer team for five years and was an assistant coach for Z’s soccer team for three years.” The claimant was with E for her soccer commitments during this time. [ 91 ] It is noteworthy that after the children entered their teenage years, the respondent found them difficult to parent and it appears their relationships became strained. 33. Overall it has been difficult to parent my children over the last 10 years.

They are not open to hear my suggestions, opinions, praise, encouragement or my heart. Since growing into teenagers they have been almost impossible to discipline and relate to. Simple requests for household chores were ignored, coming home at a reasonable hour, disrespectful replies and then if they didn’t get their way they would leave or be silent. I am frustrated with how the children have overlooked me as their parent and disallowed me to be in their lives. I also believe that the Claimant has played a

part in this and not supported my parenting but has caused more problems in how I am wanting to parent and be a leader.

We have never had unified parenting in the past and I do not have a voice as a parent. [Affidavit #2(#3) of the Respondent, unfiled, March 23, 2015.] .2 Conclusion on estrangement and unilateral termination [ 92 ] The claimant submits the evidence must show that the level of estrangement represents a unilateral termination of the relationship – in the sense of its having brought it to an end, or discontinued it. [ 93 ] The language in Farden essentially calls for conduct or statements that are decisive, not momentary or transitory, rather something near to a lasting rejection.

In this case, some of the children’s behaviour approaches that level of estrangement. In fairness to the children’s perception of the respondent, however, on occasion his demands and responses could be seen as cold and uncaring. They might also be excused for feeling somewhat confused, considering, for example, the inconsistency inherent in praising E’s soccer scholarship at UBC while refusing to contribute to the costs of her participating in a national tournament. In short, despite his best

intentions, the respondent bears some responsibility. On the other hand, at times the children’s conduct has inexcusable. [ 94 ] A termination of a relationship can assume many guises. One of the practical reasons for a termination of the relationship, or an estrangement that falls short of that, assumes such importance is because it usually terminates communication and communication is essential to the children’s showing their eligibility for their parent’s financial support. [ 95 ] I find the evidence considered as a whole falls considerably short of a permanent severance.

The ties that bind are frayed, but salvageable. I find termination of child support or contribution to s. 7 expenses is not justified based on estrangement. Going forward, however, the claimant and the children should be mindful of the significant negative implications of sullen silence or rejection, or of refusing to answer relevant questions. .3 Other relevant circumstances for child of marriage determination [ 96 ] As of September 19, 2014, $8,794 remains in the parties’ RESP. Only E will be able to access that remaining amount because A and Z have exhausted their portions.

At para. 52 of her first affidavit, the claimant explains how she attempted to manage the RESP to divide it as equally as possible. It appears each child will receive or has received approximately $13,000 and that the claimant managed the RESP well. .01 A [ 97 ] As a preliminary matter, I note that the parties’ affidavits are in near total contradiction on what information the claimant has sent, or not sent, to the respondent. It appears the claimant has provided some information, usually by email, and occasionally with documents attached.

But it would be a stretch to say the claimant has respected all the terms for production of documents. She has complied with some requests for information; some requests she has partially answered; and some she has addressed only recently and, even then, incompletely in some instances. The respondent still complains he has requested, but never received, a full transcript of all A’s grades, pointing out that the claimant indicated in her affidavit only, “A’s overall grades are good”. The other difficulty is that too much of the information provided was after the fact and with no prior discussion.

Even so, the claimant has provided the respondent with significant amounts of information on A’s education. [ 98 ] Both parties bear responsibility for the poor communication. But the claimant and the children are obliged to provide information forthwith or as soon as it became timely , in advance, as set out in the Divorce Order. The respondent should not have to chase down documents or information. [ 99 ] A is now 23 years old. She had started her university transfer studies at Douglas College in September 2010.

On October 11, 2012, the claimant advised the respondent that A would be graduating with her associate degree from Douglas College and had been accepted into Simon Fraser University (“SFU”) to complete her degree in French immersion, a three-year program. In January 2013, A transferred to SFU to complete her B.A. in French immersion. At para. 54 of her first affidavit, the claimant states that A intended to complete her B.A. with a French Major at the end of 2015, and then complete a 12-month Professional Development Program at the SFU Surrey campus, set to start in January 2016.

As she will not complete the program for a year, this means that will she finish her post- secondary education at the end of 2016, more than seven years since she started university transfer studies at Douglas College. [ 100 ] In a chart at p. 119 of her affidavit, the claimant calculates the total amount spent for tuition since September 2010 as $17,311, of which RESP withdrawals have covered approximately $12,220.

Approximately $7,000 of the tuition fees were paid to Douglas College, where A appears to have been enrolled for two years. [ 101 ] In total, the payments for Douglas College cover the period between January 2013 and September 2014, approximately one and- a-half years. The number of courses studied per term range between two and four. A does not appear to have taken a full course load in a given term. At this juncture, she is left with student loans that total $7,372. [ 102 ] Tuition fees at SFU totalled approximately $10,000 between January 2013 and September 2014.

Semester courses between September 2013 and September 2014 have been paid through student loans. Of the total, approximately $5,000 has been paid through student loans. [ 103 ] Going forward, the respondent’s position is as follows: ▪ He has been generally unaware of tuition costs and states most of the documents attached to the claimant’s affidavit were unknown to him before he received the affidavit. ▪ He knew nothing about A’s circumstances in September 2014. (The claimant somewhat addressed this in her last (and fourth) affidavit, sworn March 26, 2015 and filed during the hearing.

In it, she confirmed A is currently attending SFU. As for employment, she expects three to four shifts a week, up to five hours each day, or more, if offered to her. Other particulars, such as the hourly rate, are not stated.) ▪ A intends to travel for six months after the 2015 spring term.

She will not complete her degree until December 2016; accordingly, the respondent submits it will take her six and-a-half years to obtain a teaching certificate. ▪ He has received little or no information from either the claimant or the children, even when requested by counsel, and the claimant’s alleged refusal to provide documentation has caused unnecessary turmoil between the parties. ▪ RESP withdrawals and student loans have covered all of A’s school costs so far.

The respondent, therefore, contends that since A’s tuition and books have been covered, he should not be required to contribute to those expenses other than what he has already paid. ▪ A has not disclosed her income from part-time employment except that she earns approximately $20 hourly.

▪ To the respondent’s knowledge, A has not applied for any scholarships or bursaries. ▪ The claimant’s materials do not explain why A will not fully complete her B.A. until December 2016, six and-a-half years after she commenced post-secondary studies, and her Professional Development Program until January 2017, or why she intends to travel for six months in 2015. .02 Z [ 104 ] Z is now 20 years old. In her first affidavit at paras. 62-64, the claimant states that Z struggled academically in her final two years of high school. Z graduated from high school in 2012.

She enrolled in Kwantlen College and later enrolled at Stenberg College. [ 105 ] On May 9, 2013, the claimant advised the respondent that Z had applied to get into nursing school but had not received a reply, so was considering entering the LPN program at Athabasca University and its self-paced online RN Program, and that she would let the respondent know as soon as she had decided or been accepted into one of the programs. She also advised she had hired a tutor and asked him to pay 66% of the monthly charge of $160. [ 106 ] Z’s expenses at Kwantlen totalled $3,237 for tuition and $590 for books.

The RESP covered these expenses. Her expenses for Stenberg College totalled $31,155.52 for tuition and $1,539.20 for books, giving a total of $38,064.

An RESP withdrawal of $12,870 and $1,262 for a laptop left a total of $24,624 to be covered in student loans. [ 107 ] In her fourth affidavit dated March 26, 2015, the claimant provided the following updated information: ▪ Z writes her LPN exam May 20, 2015; ▪ she must work 1000 hours as an LPN, a prerequisite for entry into the graduated RN program at Athabasca University; ▪ the LPN program provided her with all the necessary prerequisites for the RN program and provided her with extra courses that will lessen her time in the RN program to three years instead of four; and ▪ the cost estimated on the Athabasca University website is $23,430. [ 108 ] Transcripts of grades for Kwantlen College show Z completed introductory courses for Biology, Algebra, Math, and general Chemistry, with a total GPA of 2.83.

There is no evidence these satisfy science and math prerequisites for RN programs. The transcript for Stenberg College shows good grades, but the coding for the courses does not tell the nature of the course. Assuming Stenberg College courses are accredited by university RN programs, which is not clearly established, there is no information to show which of the Stenberg College courses that Z took will be accepted at UFV, for example. Z’s final high school year grades are not strong and show weakness in sciences. RN programs are academically demanding; Z’s plans may not be realistic.

RN programs usually require extensive clinical work. There is no evidence as to how Athabasca would accommodate that requirement. .03 E [ 109 ] The materials filed for the hearing do not say what happened to E after she registered at UBC in September 2014, or why she was unable to complete her term. Counsel for the Claimant explained her personal difficulties, which I will not recount here. As noted before, E received a $2,000 annual scholarship towards her tuition; apparently she never received that, however, as she withdrew.

At Exhibit “U” of her first affidavit dated September 23, 2014, the claimant exhibited a table that shows tuition paid of $2,251.95 and textbooks paid of $400, totalling $2,651, all paid by the RESP. [ 110 ] E’s high school transcript shows an average in the range of a C+/B average. She managed to pass Science and Math 11 courses. In short, her academic record is not strong. [ 111 ] The claimant states in her fourth affidavit that E has applied at Kwantlen College to take a legal assistant course over two semesters, at an estimated cost of $7,000, including textbooks.

After that, she intends to enrol in a two-year paralegal course at Capilano College or Vancouver Community College. No costs for that are set out. The claimant also deposes that E is, “looking into dental hygienists courses at various places including Vancouver Community College.” [ 112 ] All three options of legal assistant, dental hygienist or paralegal are reasonable career goals for E. It is not necessary, however, for the parties to contribute to tuition for both the legal assistant program and a paralegal program if E chooses this path.

It should be possible for E to complete the paralegal program part-time, while working as a legal assistant. The materials do not discuss options like that or what the cost of the program is. [ 113 ] Further, $7,000 may be a reasonable estimate, but the actual amount should be documented by institutional documents. 4 Conclusions on child of the marriage determination [ 114 ] If A is enrolled at SFU for the fall 2015 semester, she shall remain a child of the marriage for support purposes until December 31, 2015.

After this date, she shall no longer be a child of the marriage for support purposes, regardless of her enrolment in a post- secondary institution. [ 115 ] Z has already qualified for a decent career, one that can provide a substantial income. I find that Z is no longer a child of the marriage for support purposes. As for supporting future expenses for an RN program, at this point a mere possibility and one sorely lacking in information, Z’s earnings as an LPN will enable her to support herself and provide a springboard for entry into an RN program, assuming she eventually qualifies.

Neither party, however, is obliged to contribute anything to tuition costs for the RN

program. Any contributions will be voluntary. [ 116 ] As E is under the age of majority and still lives at home, she remains a child of the marriage under s. 2(1) (

a) of the DA . E turns 19 on August 29, 2015. If, after that date, she is enrolled in a post-secondary institution for the 2015/2016 year, she shall remain a child of the marriage for support purposes. If not, she will no longer be a child of the marriage for support purposes. 5 Child Support [ 117 ] The claimant seeks continuing child support from the respondent. Child support in this case is determined pursuant to s. 3(2) of the Guidelines . Section 3(2) states as follows: Unless otherwise provided under these Guidelines , where a child to whom a child support order relates is the age of majority or over, the amount of the child support order is (

a) the amount determined by applying these Guidelines as if the child were under the age of majority; or (

b) if the court considers that approach to be inappropriate, the amount that it considers appropriate, having regard to the condition, means, needs and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child. [ 118 ] The claimant is entitled to child support for E until at least August 2015 and thereafter, if E is enrolled at a post-secondary institution and lives with the claimant. [ 119 ] The claimant is entitled to child support for A until December 31, 2015, if A is enrolled at SFU for the fall 2015 term and lives with the claimant. [ 120 ] If the children are adults, healthy, able-bodied, live at home with one of the parents, attend university, and earn a substantial income, the total child support the other parent is obliged to pay should generally be determined pursuant to s. 3(2) (

b) of the Guidelines : see Geran . [ 121 ] For s. 3(2)(

b) purposes, to determine the appropriate amount of support payable based on the child’s actual needs, the claimant should prepare a budget with an itemized statement of income and expenses the child is likely to earn and to incur: Geran at paras. 63, 70 and 76 . This is only reasonable because the Guidelines amounts assume a child does not earn significant income. [ 122 ] Arguably, the case at bar is more suited to a s. 3(2)(

b) determination. But the parties are content to use the s. 3(2) (

a) Guidelines amount, coupled with a principled assessment of the child’s entitlement to any special or extraordinary expenses. 6 Special and Extraordinary Expenses .1 Divorce Order [ 123 ] The Divorce Order made the following provision for special and/or extraordinary expenses: 7.

By consent, the Claimant and the Respondent shall proportionately pay, according to their income, (which currently equates to 66% payable by the Respondent and 34% payable by the Claimant), any special and/or extraordinary expenses for the Children that are agreed to prior to the expense being incurred, pursuant to s. 7 of the Child Support Guidelines, as well as the following s. 7 expenses: a. [E’s] regular league soccer fees. Any other soccer expenses shall be agreed to prior to the expense being incurred to qualify as a s. 7 expense; b.

The Children’s reasonable post-secondary tuition and book expenses provided that: i. each of the Children are in full-time attendance at a recognized post-secondary institution and maintain

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