Droit de la famille — 171197 2017 QCCA 861 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-025943-168 (500-12-263552-022) DATE: June 1, 2017 CORAM: THE HONOURABLE LOUIS ROCHETTE, J.A. JACQUES J. LEVESQUE, J.A. MARTIN VAUCLAIR, J.A. M. C. APPELLANT — CROSS-RESPONDENT — Applicant v. C. CO.

RESPONDENT — CROSS-APPELLANT — Defendant DECISION [ 1 ] The appellant appeals from a judgment rendered on February 4, 2016 and corrected on February 24, 2016 by the Superior Court, district of Montreal (the Honourable Chantal Lamarche), [1] ordering him to pay monthly support of $2,272.13 to the respondent and imposing certain relief corollary to the determination of this support. [ 2 ] The respondent also appeals from this judgment, asking that the support payable under the divorce judgment rendered on March 24, 2003 be maintained. [2] [ 3 ] For the reasons of Levesque J., as well as for the concurring reasons of Rochette J. with which Vauclair J. agrees, THE COURT : [ 4 ] DISMISSES the principal appeal; [ 5 ] ALLOWS the incidental appeal; [ 6 ] REVERSES the first instance judgment; [ 7 ] ORDERS the appellant to pay the respondent support of $3,500 per month from January 1, 2015, with legal costs against the appellant, both at first instance and on appeal.

LOUIS ROCHETTE, J.A. JACQUES J. LEVESQUE, J.A. MARTIN VAUCLAIR, J.A. Mtre. Yaël Lachkar Stadler ROBINSON SHEPPARD SHAPIRO L.R.P. For the appellant — Cross-respondent Mtre. Miriam Grassby Grassby & associés For the respondent — Cross-appellant Hearing Date: December 15, 2016

REASONS OF LEVESQUE, J.A. [ 8 ] The appellant appeals from a judgment rendered on February 4, 2016 and corrected on February 24, 2016, by the Superior Court, district of Montreal (the Honourable Chantal Lamarche), [3] ordering him to pay the respondent monthly support of $2,272.13 beginning January 2015 and setting out the elements to be taken into account in determining his annual income for the purpose of calculating monthly support payments for the year 2015 and for the subsequent years. [ 9 ] The respondent, by way of incidental appeal, seeks to maintain the current support payments, in light of the appellant's bad faith.

She also proposes that income from registered retirement savings plans ("RRSP") he holds with the Quebec government be included in the income considered. Context [ 10 ] Married in 1978, the parties obtained a divorce judgment on March 24, 2003. [4] The judgment confirms an agreement ("Agreement") between them and governs, in great detail, the relief corollary to their divorce. The parties were represented by experienced lawyers who advised them with respect to all the details of their Agreement. [ 11 ] At the time of the divorce, the respondent ("Ms.

C.") had no job, having left her position as a nurse when the couple's two daughters, now adults, were born. The appellant ("Mr. C."), who alone has always provided for the family's needs, was an accountant and tax expert, and in 2003, his annual income was established at approximately $550,000. [5] [ 12 ] The Agreement provided for monthly support payments of $7,500 to Ms. C., beginning January 1, 2003, and to be indexed according to the law. [ 13 ] The movable and immovable property kept by Ms. C., in addition to her RRSP, had an established value of $450,000, net of Ms.

C.’s obligation to reimburse a $188,050 line of credit registered in Mr. C.’s name only. [6] [ 14 ] The assets kept by Mr. C. were not specified in the Agreement. [ 15 ] The Agreement was no doubt intended to achieve a balance between the spouses and its clauses form a whole. I find it useful to reproduce it in extenso : [translation] WHEREAS the parties are currently involved in divorce proceedings, as appears in more detail in the court record; WHEREAS the parties married in City A on October 7, 1978, under the matrimonial regime of the separation of property, by marriage contract concluded before Mtre.

Adrien Desy, notary; WHEREAS two (2) children were born of this marriage, namely: - X, a daughter born on … 1979, currently age 23; - Y, a daughter born on … 1982, currently age 20; WHEREAS the children referred to in the preceding paragraph are of full age and no longer live with the defendant; WHEREAS the parties have been living apart since the first of January 2001; WHEREAS the applicant is an accountant and has an annual declared income of approximately $550,000 ; WHEREAS the defendant is a nurse and has an annual income of approximately $5,000.

WHEREAS the parties signed an exemption agreement with respect to the articles of the Civil Code of Québec relative to the family patrimony before Mtre. Diane Sperano, notary; WHEREAS the defendant instituted proceedings in separation from bed and board on October 15, 2001 , but no judgment has been rendered in this file (500-04-027254-011); WHEREAS the parties declare that there is no possibility of reconciliation between them; WHEREAS the parties have considered the following factors in their settlement pursuant to sections 15.2(4) and 15.2(6) of the Divorce Act , notably: (

a) the length of time the spouses cohabited;

(

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

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

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

e) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time; [7] WHEREAS the parties wish to settle the consequences of their divorce amicably and enter into a final Agreement in order for it to be incorporated into the forthcoming judgment of divorce, as the case may be; THE PARTIES AGREE AS FOLLOWS:

ARTICLE I

DEFINITIONS AND PRELIMINARIES 1.1 The

preamble is an integral part of this Agreement; 1.2 For the purposes of this Agreement: (

a) the immovable bearing civic number … in City B, …, the parties' former matrimonial home and the defendant's property, will hereinafter be referred to as the " family residence" ; (

b) the immovable bearing the civic number … in City C, …, the parties' former secondary matrimonial home and the defendant’s property, will hereinafter be referred to as the " secondary residence ";

ARTICLE II SUPPORT 2.1 For the purposes of this Agreement: 2.1 The applicant will pay to the defendant, for the benefit of the latter, support of $7,500 per month, effective January 1, 2003; 2.2 The support will be indexed in accordance with

article 590 of the Civil Code of Québec ; 2.3 In the event that support is still being paid to the defendant when the applicant turns 60 years of age, on … 2014, and the applicant is retired, this support will be reduced to the amount of $3,500 per month, it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date; 2.4 In the event that support is still being paid to the defendant when the applicant turns 60 years of age and the applicant is not retired, the applicant will continue to pay the defendant the support provided for in clause 2.1 of this Agreement until the first of the following two events occurs, it being agreed that the annual support payable will never exceed one third (1/3) of the applicant's annual income: (

a) the retirement of the applicant; (b) …, 2019, on which date the applicant will turn 65 years of age; and at which time the support paid will be reduced to the amount of $3,500 per month, it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income; 2.5 Given this Agreement and that the applicant is renouncing any claim to a compensatory allowance such that the defendant will retain the residences and her RRSP, to which only the applicant has contributed financially, the defendant hereby renounces any increase whatsoever in support; 2.6 The applicant reserves the right to claim a variation in support paid to the defendant for any reason recognized by law and, without limiting the generality of the foregoing, notably in the event that:

a) the defendant's annual income is equal to or greater than $50,000;

b) the applicant's income significantly decreases; 2.7 The parties agree and the defendant consents to the applicant being exempted from paying support for the benefit of the defendant to the ministère du Revenu; 2.8 The applicant undertakes to pay to the ministère du Revenu sufficient security to guarantee support payments for one month, as required by the Act to facilitate the payment of support ; 2.9 The applicant will pay support directly to the defendant on the first day of each month;

ARTICLE III

PARTITION OF ASSETS AND LIABILITIES 3.1 As the parties have renounced the provisions relating to the partition of the family patrimony, they agree as follows with regard to the partition of their assets and liabilities; 3.2 The defendant will be the sole and absolute owner of the following assets: (

a) the family residence; (

b) the secondary residence; (

c) the RRSPs registered in her name; (

d) all the movable property and movable effects currently garnishing the family residence and the secondary residence, with the exception of the property listed in Annex A, which will be the exclusive property of the applicant, to be recovered by the latter within thirty (30) days of the divorce judgment; (

e) any pension plan to which she is entitled; (

f) any other movable or immovable property registered in her name or in her possession; The defendant acknowledges that the value of the assets listed in this clause is approximately $450,000, less the debt mentioned in clause 3.4 of this Agreement, and that, where applicable, the cost of these assets has been fully assumed by the applicant, with the exception of the employer pension plan; 3.3 The applicant will be the sole and absolute owner of the following assets: (

a) the RRSPs registered in his name; (

b) the property listed in Annex A; (

c) any other movable or immovable property registered in his name or in his possession; 3.4 The defendant alone will be responsible, with the applicant being fully relieved thereof, for the line of credit registered in the applicant's name with the Caisse populaire canadienne italienne, bearing the number … and for which the balance due on January 30, 2003, was $188,050; 3.5 The defendant must release the applicant of this debt (3.4) with the Caisse populaire canadienne italienne prior to May 30, 2003, by assuming a hypothec on the family residence and/or the secondary residence or by contracting a new line of credit; 3.6 Subject to this Agreement, each party will be solely liable for any debt registered in his or her name, with the other partly being fully relieved thereof.

ARTICLE IV MARRIAGE CONTRACT 4.1 The parties state that they are satisfied and discharge any right, claim or recourse that they hold or may have in respect of the marriage contract concluded between them on July 5, 1978, before Mtre. Adrien Desy, notary, and registered in City A under the number …;

ARTICLE V INSURANCE 5.1 The applicant agrees to maintain in effect a life insurance policy with an insured value of $250,000 and to name the defendant as beneficiary for as long as support payments are made for the benefit of the defendant; the defendant will sign any document necessary, if any, to change the beneficiary within ten (10) days following the last support payment;

ARTICLE VI RÉGIME DES RENTES DU QUÉBEC 6.1 The parties agree to the partition of earnings registered in their respective names between the date of marriage, October 7, 1978, and the date they ceased living together, January 1, 2001;

ARTICLE VII DISCHARGE 7.1 Subject to this Agreement, the parties grant each other full and final discharge from any claim that each has or may claim to have toward the other for, in particular, advances, contributions, loans, lump sum, compensatory allowance and for any right that could result or stem from the marriage, its breakdown, their life together, the matrimonial regime or a contract between them;

ARTICLE VIII

MISCELLANEOUS STIPULATIONS 8.1 The parties are fully committed to this Agreement, endeavouring at all times to abide by its spirit and intent.

They will sign any document or agreement rendered necessary to complete its execution; 8.2 In the five (5) days following the defendant’s assumption of the debt stipulated in clause 3.4, with the applicant being fully relieved thereof, the latter will pay defendant's counsel, to her benefit, the sum of $5,000 as provisions for costs; 8.3 This Agreement will bind the parties, their successions, executors, heirs and beneficiaries to its complete execution; 8.4 Each party will be responsible for his or her debts (including the defendant's line of credit debt stipulated in clause 3.4) and will hold the other free and clear from any claim that may be made against the party resulting from the other's debts or undertakings and will have to indemnify the party of all costs, disbursements or professional legal fees incurred for the defence of such claim; 8.5 The parties agree to file this Agreement in the court record as consent to judgment with respect to its content and to request that this Agreement be incorporated into the forthcoming divorce judgment; 8.6 The parties acknowledge that they have provided a complete and accurate picture of their relative financial positions, assets and liabilities and all their undertakings.

The parties declare themselves satisfied with the content of the disclosure on which they have relied; 8.7 Both parties have been duly represented by counsel, have read and understood all the clauses of this Agreement and have agreed to it voluntarily and freely; 8.8 Should one or more of the stipulations contained in this Agreement prove invalid, illegal or unenforceable in certain respects, the validity, legality and enforceability of other stipulations will not be affected or diminished; 8.9 This Agreement will come into force on the date it is signed by all parties; 8.10 This Agreement constitutes a transaction within the meaning of articles 2631 and following of the Civil Code of Québec ; 8.11 Each party paying its own expenses, subject to clause 8.2 of this Agreement; [Sic; bold in the original] [ 16 ] It bears noting that the corollary relief the parties agreed to must be assessed in light of the considerations arising from the application of sections 15.2(4) and 15.2(6) of the Divorce Act . [8] These considerations are also reproduced in the Agreement: (

a) the length of time the spouses cohabited; (

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

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

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

e) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time; [9] [Sic] [ 17 ] It should also be noted that the possibility of Mr. C.'s retirement and its impact on the support payable to Ms. C. are specifically established, that she renounced any claim to an increase in support and that no time period is imposed for her to become financially self- sufficient. On the other hand, Mr. C. reserves the right to ask for a reduction of support [translation] "for any reason recognized by law" and in particular if Ms.

C.'s annual income exceeds $50,000 or if his income significantly decreases. [10] [ 18 ] It is also clearly stipulated that: [translation] The parties are fully committed to this Agreement, endeavouring at all times to abide by its spirit and intent . They will sign any document or agreement rendered necessary to complete its execution; [11] [Emphasis mine] [ 19 ] It happens that Mr. C. chose to retire on his 60th birthday, … 2014. He first tried to reach an agreement with Ms. C. with respect to the support to be paid to her, but the discussions failed. Mr. C. then decided to offer to pay Ms.

C. monthly support of $1,438,representing one third of the expected annual income he calculated by discounting his 2015 income to roughly $51,796. She refused and went to the Collector of Support Payments who established the monthly support payable at $4,400. [ 20 ] Mr. C. therefore went before the Superior Court in May 2015, invoking

section 17 of the Divorce Act and the terms of the Agreement, to request that the support payable to Ms. C. be reduced [translation] "to a sum equivalent to one third of the applicant's income, beginning January 1, 2015". [12] [ 21 ] The hearing before the Superior Court was held on December 3 and 4, 2015. Lamarche J. rendered her detailed and carefully reasoned judgment on February 4, 2016. A corrective judgment was filed on February 24, 2016 to address a clerical error. Specifically, the judge noted the following:

[translation] [48] As Mr. C. has long been working 60 to 80 hours per week, five to seven days per week, he explained that for the past several years he had intended to retire at age 55. Nonetheless, in the course of negotiating the Agreement, he agreed to postpone his retirement. [49] In return for the property that he left to Ms. C. and the support, he wants to be able to retire at age 60 and to anticipate that monthly support for Ms. C. will then be $3,500 or the equivalent of one third of his retirement income, whichever is less. [50] Since July 2003, that is, after the divorce, 90% of the income that Mr.

C. received from his law firm employment was paid to his personal company [Company A] ([Company A]) and 10% was paid into his family trust, the beneficiaries of which are his two daughters and himself. [51] In 2013, the law firm paid $59,612 to his family trust and $548,960 to [Company A]. In 2014, the law firm paid $59,882 to his family trust and $760,025 to [Company A]. ... [58] Ms. C. refused to meet with him, believing that he wanted to modify the Agreement and to no longer pay $9,400 in support. She contacted her lawyers and asked Mr. C. to send them certain details in writing. ... [62] In 2015, Mr.

C. had no income-generating professional activity. He took woodworking courses twice a week. He spent four days a week at his cottage in City D (" Cottage "). [63] He retired believing that he would have to pay support equal to the lesser of $3,500 per month or the equivalent of one third of his income. He argues that were he to be required to continue to pay $9,400 in support, he would deplete his capital far too quickly. ... [65] $17,265, or monthly support of $1,438, is one third of Mr.

C.'s annual income, which he is prepared to pay. ... [67] At the same time, in 2014, he sold some of [Company A]'s investments for approximately $1.3 M. [68] He paid income taxes on this amount. He used $600,000 to expand his cottage. Within two years, he plans to live there full-time with his spouse and wants to be able to accommodate his children and grandchildren since the cottage is located far from City A. The expansion started in 2014 and was completed in 2015. With this withdrawal, he also paid Ms. C. roughly $112,800 in support and used approximately the same amount for his personal needs. [69] Mr.

C. also furnished the addition to the cottage with high-end furniture. For example, he spent more than $45,000 on a billiard table, two sculptures and the living room furniture. ... [71] When she learned in January 2015 that Mr. C. was only paying her $1,000 in support, without notifying her, Ms. C. claims that she collapsed. [72] She had always believed that he would never retire. However, she added that she wanted to pay off the hypothec on her home as quickly as possible before the support decreased. In cross-examination, she also added that she knew that the Agreement provided that Mr.

C. could retire at age 60, but her perception was that he never would. [73] In 2015, against the advice of the financial advisor who administers her RRSP, Ms. C. withdrew $15,000 from her RRSP to support herself since Mr. C. had reduced monthly support to $1,000. [74] Ms. C. wishes to keep the residence where she lives alone since it allows her grandchildren to sleep there when they come to visit her. This residence includes three bedrooms, an in-ground swimming pool and a double garage. It is located in a sought-after neighbourhood in City C.

The neighbourhood is calm; she feels safe there and has developed good relationships with her neighbours. [75] According to Ms. C., Mr. C. may not retire in the above-mentioned circumstances. She believes that he is retiring to punish her because she refused to sign a verbal agreement and to avoid continuing to pay her monthly support of $9,400. ... [78] Ms. C. also criticized Mr. C. for not acting in good faith by withdrawing $1,350,000 from [Company A]'s investments and failing to ensure that he had sufficient income to pay monthly support of $3,500. ... [90] The Agreement is clear; Mr.

C. can retire at age 60. ... [100] The Court considers that he did not violate his obligation of good faith when he withdrew his capital. For him, it was a matter of

adding on to the cottage where he was going to live in two years' time. [101] Given that the parties did not provide for a guaranteed minimum monthly pension of $3,500 upon Mr. C.'s retirement, as the Court concludes in the next section, the drop in his income that resulted in monthly support of less than $3,500 is not necessarily evidence that he failed to respect his obligation to act in good faith. ... [105] Moreover, even if Mr.

C. had not withdrawn $600,000 plus tax from [Company A]’s capital, his income still would not have reached $126,000, which is the minimum income required to pay a monthly pension of $3,500. ... 4.2 Should clause 2.3 of the Agreement for reducing support at the time of Mr. C.'s retirement be interpreted as guaranteeing Ms. C. monthly support of $3,500, except in the case of force majeure? [109] According to Ms. C., clause 2.3 of the Agreement obliges Mr. C. to pay monthly support of $3,500, except where circumstances beyond his control make it no longer reasonable for him to pay this amount.

That would be the case, for example, if the stock market were to collapse and his investments no longer offered attractive returns. [110] Ms. C. submits that, in such a situation, Mr. C. could have obtained leave from the Court to pay support representing only one third of his annual income. She argues that the Court must adopt this

interpretation of clause 2.3 because the Court must consider her legitimate expectations. [111] The Court does not agree with Ms. C.'s position. [112] The Court need not interpret a contractual provision that is clear and clause 2.3 is clear: [translation] ... , this support will be reduced to the amount of $3,500 per month, it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date; [113] The parties did not provide that Ms.

C. would receive minimum monthly support of $3,500. [114] In the absence of such a guarantee, the Court cannot conclude that Mr. C. must ensure that he has sufficient income to ensure that one third of it is never less than $3,500 per month. [115] In addition, the Court has no qualms about concluding that the obligation, which falls on Mr. C. and Ms. C., will result in his obligation to pay support of $3,500 at the time of his retirement. [116] If the parties had wanted to provide for a minimum amount of support for Ms. C., they would have done so.

Let us not forget that each party was represented by an experienced lawyer. [117] In addition, they provided for this wording (that the support not exceed one third of Mr. C.'s income) three times in clauses 2.3 and 2.4 of the Agreement. [118] The Court sees nothing other than a clear provision which requires no

interpretation and which provides that when Mr. C. turns 60 years old and retires, the support will be $3,500 per month or one third of his income, whichever is less. [119] To conclude as Ms. C. requests would oblige the Court to decide solely on the basis of her expectations, setting aside a clear text as well as the parties' common intention in 2003. The Court does not believe that the rules of good faith can lead to such a result. [120] The Court also notes that the proportion of support paid to Ms. C. in relation to Mr.

C.'s income has increased considerably since he retired. [121] Indeed, since his retirement, support has represented one third of his income, which was not previously the case. For example, at the time of the divorce, Mr. C. reported an annual income of $550,000 and paid Ms. C. annual support of $90,000 representing no more than 16% of his income. In 2014, he reported income of more than $1 M and paid $112,800 in support, representing no more than 11% of his income. [122] The Court thus concludes that clause 2.3 provides that, since December 31, 2014, the support that Mr. C. must pay to Ms.

C. is the lesser of $3,500 per month or one third of his income. ... [157] The Court adds that this sum has not been indexed since the date of the divorce because the parties specifically provided that when Mr. C. retired support would be the lesser of $3,500 or one third of his income. Even if the amount of $3,500 must be indexed, as long as support amounts to only one-third of his income, this support does not have to be indexed. [158] Support will, however, be adjusted annually based on Mr.

C.’s income, and he will be required to provide his personal income tax returns, [Company A]'s financial statements, and investment account statements for himself and [Company A] so that Ms. C. may see the withdrawals he makes. [13] [Sic; references omitted; bold in the original]

[ 22 ] The judge ruled on the application as follows: [translation] [6] ... ... ORDERS Mr. C. to pay Ms. C. monthly support of $ 2,272.13 beginning January 1, 2015, taking into account sums that he has already paid, that is, $1,000 since January 1, 2015. This support will be adjusted on June 1 of each year beginning in 2016, based on Mr. C.'s income determined according to the following paragraph of this judgment.

Any excess payment or debt resulting from such an adjustment is to be reimbursed or paid, as the case may be, before the 31 st of December; [14] [Sic; emphasis in the original] [ 23 ] As well as: [translation] [162] DECLARES that Mr. C.'s income for the purposes of paying support to Ms. C. consists of interest and dividends on all the investments in the name of M...

C..., interest and dividends of investments of [Company A] after tax, as well as any dividend that he pays himself from [Company A], interest that Davies Ward Phillips & Vineberg pays to [Company A] after taxes and a sum equivalent to withdrawals that Mr. C. makes from his capital or that of [Company A] for a given year; [163] GRANTS release of seizure in the hands of third parties to [Company A] once the support arrears arising from this judgment have been fully paid; [15] [ 24 ] Both parties are dissatisfied with the Superior Court judgment. Mr.

C. submits that the judge committed an overriding error by including in his annual income the capital withdrawals that he makes in the course of a year, by establishing the elements that make up his annual income for the purposes of paying support, and by fixing the support payable to Ms. C. at $2,272.13 per month from January 2015. He is also of the opinion that the judge erred in ordering that support be readjusted on June 1 of each year starting in 2016. [ 25 ] Ms. C. is essentially of the opinion that the judge needed to establish Mr. C.'s income in order to determine the support he must pay.

Her incidental appeal alleges that the judge did not consider the appellant's bad faith when he chose to retire and withdraw $1,300,000 from his assets in 2014. She claims that the judge committed a overriding error in failing to accept her contention that clause 2.3 of the Agreement fixes support at $3,500 in the event that Mr.

C. were to retire and that the note [translation] "it being agreed that the annual support payable may never exceed one third of the applicant's annual income" would apply only where the condition in clause 2.6 could be met. [ 26 ] She also contends that the judge erred in establishing monthly support at $2,272.13 for the year 2015 and in ordering a re- assessment of the said support each year. [ 27 ] Finally, I note that it appears from the statements of income and expenses filed in the record that on June 8, 2015 Ms. C.'s income was $362.99 and that her assets totaled $1,034,926.80. Mr.

C.'s income was estimated at $52,188.01 for 2015, and on May 14, 2015 his assets totaled $3,485,343. Analysis [ 28 ] In my view, to resolve the appeal, it is sufficient to determine the actual scope of the provisions of the Agreement relating to support through an analysis that respects their [translation] "spirit and intent". [16] [ 29 ] The parties attached great importance to the factors set out in the Divorce Act . The Agreement takes into account the length of time the parties cohabited, the role of each spouse and the advantages or disadvantages arising from the breakdown of the marriage.

The Agreement seeks to remedy the economic hardship arising from the breakdown of the matrimonial bond and to promote the economic self-sufficiency of each party within a reasonable period of time. [ 30 ] However, the Agreement is silent as to the length of this period. It appears that 12 years after the divorce, Ms. C., age 61 at the time of the hearing, has not reached financial self-sufficiency. The amount of monthly support paid by Mr. C. on the day he retired was $9,400. [ 31 ] By signing the Agreement, he acknowledged that, irrespective of support, Ms.

C. should have an income of $49,999.99 without altering support. Clause 2.6(

a) of the Agreement makes this clear. [ 32 ] In 2003, when Mr. C. agreed to pay monthly support of $7,500, his income was, as he wrote, approximately $550,000. As the judge noted, his employment income was $608,572 in 2013, and $819,907 in 2014. [ 33 ] The Agreement provides for a number of situations which could affect payment of support to Ms. C. The first being, as I said earlier, that she would realize financial self-sufficiency when her income reached $50,000.

In this case, support may cease, on application by the appellant to the appropriate court. [ 34 ] The Agreement also provides for the eventuality that Mr. C. would retire at age 60, not retire at age 60, retire after age 60 but before 65, or, finally, retire at age 65.

[ 35 ] With the exception of the condition relating to Ms. C.'s income in clause 2.6 of the Agreement, the intention expressed by Mr. C. and accepted by Ms. C., in each of the scenarios envisaged, was to pay support [translation] “reduced to the amount of $3,500 per month, it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date.” [17] [ 36 ] Ms. C. submits that the last part of the support clause relating to [translation] "one third (1/3) of the applicant's annual income" is only applicable where, in accordance with clause 2.6(

b) of the Agreement, Mr. C.'s income [Translation] “significantly decreases”. [ 37 ] She submits that she agreed, when she signed the Agreement, to have her support reduced to $3,500 either when Mr. C. retired at age 60 or upon his retirement between age 60 and 65, or at age 65. She also acknowledged that the support payments he made could not exceed one third of his annual income in the event that Mr. C. experienced a [translation] “significant reduction in income”.

In her view, the spirit of the Agreement and the parties' intention cannot support the notion that such a significant reduction in his income would depend solely on his choice to limit his annual income. [ 38 ] It is well established that an appellate court must not modify a first instance decision regarding support “unless the reasons disclose an error in principle, a significant misapprehension of the evidence, or unless an award is clearly wrong.” [18] [ 39 ] The May 14, 2015 motion entitled [translation] "Motion to Vary Corollary Relief" ( s . 17 of the Divorce Act ) is intended instead as an application for declaratory judgment in order to obtain recognition of the claim made by Mr.

C. regarding the application of the 2003 divorce judgment. There is no [translation] “material change” in the generally understood sense because Mr. C.'s retirement was clearly provided for in the Agreement. [ 40 ] On the other hand, perhaps Mr. C.'s annual income [translation] “significantly decreased”, but this is not attributable to an event beyond his control. The tax structure that he set up allows him to determine his own annual income. He estimated this income to be approximately $52,000 for the year 2015, when his total assets, including his RRSPs and his investments, totaled nearly $3,000,000.

Remember that his income was more than $800,000 for the year 2014. [ 41 ] The first instance judge concluded that clause 2.3 of the Agreement was [translation] "clear" and that it did not require

interpretation. Thus she wrote: [translation] [118] The Court sees nothing other than a clear provision which requires no

interpretation and which provides that when Mr. C. turns 60 years old and retires, the support will be $3,500 per month or one third of his income, whichever is less. … [122] The Court thus concludes that clause 2.3 provides that, since December 31, 2014, the support that Mr. C. must pay to Ms. C. is the lesser of $3,500 per month or one third of his income . [19] [Emphasis mine] [ 42 ] This Court recently recalled that a clear-cut contractual clause must be approached with caution: [ translation ] [25] Even were this text to be considered clear to the point of not raising any problems of

interpretation, it is appropriate to point out that ambiguity can occur even when a text is clear. As emphasized by authors Lluelles and Moore, judges must first do a

summary

interpretation (pre-interpretative phase) to ascertain whether there is ambiguity: translation] Doubt sometimes arises from the use of an inadequate term or from a contradiction between two clauses. But ambiguity stems most often from a lack of precision . . . One should be wary of apparent clarity.

A text can be clear, taken separately, but turn out to be obscure when considered in context with the rest of the agreement; it can also be completely unambiguous from the standpoint of form, but contradict the objective clearly sought by the parties. [20] [References omitted.] [ 43 ] Similarly, recognizing the principle that the parties to an agreement can hardly have consented to an application leading to an absurd result, the Court wrote: [translation] Finally, the third element that allows me to accept the appellants' proposal is the will of the courts to avoid an absurd or unfair result where possible.

Indeed, as expressed by Etsey J. in Consolidated-Bathurst v. Mutual Boiler , at p. 901: Where words may bear two constructions, the more reasonable one, that which produces a fair result, must certainly be taken as the

interpretation which could promote the intention of the parties. [21] [References omitted] [ 44 ] In D.V. c. J.A.F. , the Court noted in particular that:

[translation] [54] However, where the agreement is unreasonable and the result to which it leads is marked by constraint and unfairness, it may be annuled, in whole or in part, by a competent court. That is why the terms chosen by the parties must reflect the nature of their consent and the intelligibility of their preferred mode of settlement. On their own, standard release clauses, and their general terms extinguishing all economic relations between the spouses, cannot exclude a careful consideration of the obligations incurred.

The rationale founding the agreement must clearly flow from the contractual arrangements chosen by the parties so that the validity of the release clauses and the final break may be assessed. [22] [ 45 ] Author François Gendron is of the opinion that the assessment of a clear clause must not lead to an unreasonable result: [translation] From the fact that the contract must be given a useful effect also follows the rule that it cannot lead to an absurd result. Something that makes no sense has no useful effect.

Here, the interpreter presumes that the contracting parties are sensible people and do not seek the absurd. He will therefore disregard

interpretations which lead to extravagant or unreasonable outcomes flowing from illogical clauses or to [translation] “ aberrant situations stripped of any commercial logic” and will also disregard

interpretations that respect the letter of the contract but legitimize the violation of its intent. [23] [ 46 ] I am of the view that the first instance judge was correct in concluding that clause 2.3 of the Agreement is clear. However, with the utmost respect, I am also of the view that she made an overriding error in adding a major element to the Agreement's clear terms. This led her to impose an unrealistic conclusion unforeseen by the parties: the obligation to appear before the court each year so that Mr.

C.'s annual income may be assessed. [ 47 ] Indeed, the judge added to the Agreement's clear terms by writing: [translation] [118] … support will be $3,500 per month or one third of his income, whichever is less. … [122] … the support that Mr. C. must pay to Ms. C. is the lesser of $3,500 per month or one third of his income. [24] [Emphasis mine] [ 48 ] Rather, the Agreement provides that when Mr. C. reaches age 60 and retires, the [translation] “support will be reduced to the amount of $3,500, it being agreed that ...” [25] [ 49 ] If the parties had wanted and agreed that the support payable to Ms.

C. would be equal to one third of Mr. C.'s annual income at the time of his retirement, they would certainly not have chosen to specify that support would then be $3,500. [ 50 ] The judge’s

interpretation therefore does not respect the spirit and intent of the Agreement. It leads to a situation which, without being entirely absurd, is clearly unrealistic: the support payment that will be paid to Ms. C. for the year 2015 is entirely dependent on Mr. C.'s choices. In addition, unless she simply bends to his will, she will have to appear before the Superior Court each year to fix the annual income that will determine the amount of support payable to her.

That is certainly an inequity unwanted by the parties when they signed the Agreement in 2003. [ 51 ] I therefore propose to dismiss the appeal, allow the incidental appeal, reverse the first instance judgment and fix the monthly support payable to Ms. C. at $3,500 as of January 1, 2015, to be indexed annually in accordance with the law. I propose that the legal costs, in both courts, be borne by the appellant. JACQUES J. LEVESQUE, J.A.

REASONS OF ROCHETTE, J.A. [ 52 ] After reviewing the reasons of my colleague, Levesque J.A., and with great respect, I feel the need to present a different analysis in these concurring reasons. [ 53 ] As my colleague points out, the parties are both dissatisfied with the first instance judgment. The appellant criticizes the judge for having erroneously interpreted the notion of [translation] "income" in clause 2.3 of their agreement (“the Agreement”) by including in

the appellant's income the capital withdrawals he made. According to the appellant, the calculation of [translation] "income" is also incorrect, as is the date for readjusting support. [ 54 ] According to the respondent-cross-appellant, the judge should have concluded that the appellant retired in bad faith and that this was not a material change giving rise to a review of support.

At the very least, support should have been set in light of the income that the appellant would have earned working part-time, an opportunity that he refused, the respondent said, because of his support obligations toward her. [ 55 ] The respondent also argues that the judge erred in law in considering the appellant's duty of good faith under the Agreement merely as malicious intention while here there is abuse of right and unreasonable conduct toward her. She refers us to the implicit obligations arising from a contract and proposes a contextual analysis of the Agreement.

She claims that the judge failed to consider the extravagant expenses the appellant incurred in renovating his secondary residence which significantly affected his future income and hence the support to which she is entitled. [ 56 ] The judge should also have concluded that the words [translation] "it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date" [26] were intended only to protect the appellant in the event of unpredictable financial difficulties, given the ambiguity of the Agreement.

The judge's determination that the respondent received a significant portion of the parties' assets when the Agreement was concluded is also contested. In sum, the judge should have set monthly support at $3,500 as stipulated in the Agreement. [ 57 ] Finally, the respondent argues that if the Court were to endorse the calculations used by the judge, the income determination is flawed.

In addition, the steps required to fix future support will be cumbersome, costly and detrimental to the respondent. *** [ 58 ] After analyzing the evidence, the first instance judge concluded that the appellant did not breach his obligations or act in bad faith when he retired . [27] The respondent proposes a different reading of the evidence, but from my point of view, she does not point to the palpable and overriding error without which the Court's intervention cannot be considered. I would therefore reject that ground of the appeal. [ 59 ] This brings us to the

interpretation of clause 2.3 of the Agreement, reproduced again here for convenience’s sake: [translation] 2.3 In the event that support is still being paid to the defendant when the applicant turns 60 years of age, on ... 2014, and the applicant is retired, this support will be reduced to the amount of $3,500 per month, it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date; [ 60 ] The

interpretation of this clause is the basis of this dispute. [ 61 ] Even assuming it is clear, the respondent still relies on the implicit content of the Agreement, the context and the appellant's blameworthy conduct to argue that ultimately the one third of annual income approach should not be applied.

She contends that only monthly support of $3,500 should be considered. [ 62 ] The rule is well known; in the absence of ambiguity and where the clause clearly reflects the parties' intentions, great deference is called for, bearing in mind [translation] "the rule that a clear text [translation] 'faithfully reflects the parties' intention' is only a rebutable presumption." [28] [ 63 ] It is also true that considerable weight should be given to a fairly negotiated agreement which represents the parties' intentions and expectations while substantially complying with the objectives of the Divorce Act . [29] This rule was set out by the Supreme Court in Miglin .

There the Court considered the analysis required to determine initial support where the parties have signed an agreement. [30] We are no longer at the initial stage here, as I discuss below. [ 64 ] Ambiguity can take many forms. It [translation] "manifests in a plurality of possible meanings of a term or clause" at which point one can then speak of [translation] "a lack of precision". [31] It may also arise from factors inherent to the contract or its general context, including circumstances subsequent to its signing. [32] Didier Lluelles and Benoît Moore write: [translation] 1573.

Doubt sometimes arises from the use of an inadequate term or a contradiction between two clauses. But the ambiguity most often flows from a lack of precision , although a lack of precision is not necessarily synonymous with ambiguity. Lack of precision can be avoided through the use of

definitions, although that technique may itself lead to ambiguity or at least be difficult to apply to the facts of the case! ... 1581. Beyond this intrinsic ambiguity, doctrine and jurisprudence recognize another form of [translation] "extrinsic ambiguity". In this case, ambivalence does not arise from the clause itself, or even from its juxtaposition with another clause in the act or in another act, but with subsequent circumstances . The terms of the act are in themselves clear and allow no room for any meaning beyond the usual. Normally, the judge should adhere to this obvious meaning, and not proceed to the second stage of

interpretation. But it may happen that the judge nevertheless concludes that there is ambiguity, and begins to interpret. This is likely to be the case if a clause becomes susceptible to more than one reading due to a factual situation subsequent to the conclusion of the contract . In the revealing words of Mr. Ivainer, [translation] "most often, the clear-ambiguous dilemma follows a confrontation between the terms of

an act and a particular post- contractual experience". In other words, [translation] "just because the terms are clear does not mean that the common intention will

be." [33] [Emphasis added] [References omitted] [ 65 ] In the event of ambiguity, the judge must interpret the contract to identify the probable common intention of the parties and to avoid implausible results. [34] In the presence of a palpable and overriding error, the Court has complete discretion to intervene with respect to a prior finding that a text is ambiguous. [35] [ 66 ] With respect for my colleague's opinion, which endorses the position adopted by the first instance judge, [36] I am of the view that there is ambiguity here and that the judge should have interpreted the contract to uncover the parties' common intention.

The need to do so stems both from the lack of precision in clause 2.3 and the circumstances subsequent to the signing of the Agreement. [ 67 ] Let us take a few steps back. [ 68 ] In his motion to vary corollary relief filed on May 20, 2015, pursuant to

section 17 of the Divorce Act , [37] the appellant seeks to vary the initial support order made in the divorce judgment.

Invoking clause 2.3 of the Agreement, he explains his financial situation since his retirement, calculates his investment income and his total income for the year 2015 at $52,188.01, and asks the Court to fix monthly support at $1,449.67, that is, $17,396.04 per year, from January 1, 2015, the day he retired. [ 69 ] When considering an allegation of material change, the usual practice is to compare the parties' situation at the time of the original order with that at the time of the motion for variation.

An attempt will be made to determine whether a change has occurred such that the agreement no longer respects the parties' intention or the broad principles governing divorce matters. The change cannot be purely temporary. [38] [ 70 ] The appellant had no choice but to file a motion for variation and was right to do so. The impugned clause, though it proposes a method of calculation, does not fix the amount of support and given such a lack of precision, is not enforceable.

Moreover, the circumstances subsequent to the signing of the Agreement make the determination of support very complicated, even risky, for reasons that I will elaborate below. [ 71 ] This is a material change [39] which, though contemplated in the Agreement, [40] required the court to fix support by taking into account, notably, the conditions stipulated by the parties, so as to resolve the very concrete difficulty encountered. [ 72 ] What was the parties' common intention in March 2003? [ 73 ] Among other things, the corollary relief agreement signed in March 2003 stipulates that the respondent will receive from the appellant indexed support of $90,000 per year or $7,500 per month. [41] If support is still paid when the appellant turns 60 (… 2014) and he is then retired, support will be reduced to $42,000 per year.

However, the support may not exceed one third of the appellant's annual income. [ 74 ] For reasons set out in the agreement (clause 2.5), the respondent renounces her claim to any [translation] "increase whatsoever in support".

The appellant may apply for a reduction in support, in particular if the respondent receives an annual income of $50,000 or more or if the appellant's annual income [translation] "significantly decreases" (clause 2.6). [ 75 ] It appears from the agreement that the respondent is not financially self-sufficient, that this situation arises from the economic disadvantages resulting from the breakdown of the marriage, that the support is intended to remedy this difficulty and will not, in principle, be terminated when the appellant retires or turns 65.

The respondent does not commit to financial self-sufficiency [42] and the appellant agrees to maintain his $250,000 life insurance policy for the benefit of the respondent, [translation] "as long as he pays support to Ms. C." [43] [ 76 ] The parties' marriage, described as traditional by the first judge, [44] lasted slightly more than 24 years, including 22 years of living together.

At the time of the divorce, the parties were both 48 years old. [ 77 ] In sum, the Agreement is satisfactory to both parties and provides long-term security for the respondent who had every reason to believe that when support was reduced, the appellant would be able to accumulate an annual income of $126,000 and pay her $42,000 annually. This was a guarantee of stability for the respondent unless, as she understood, the appellant's financial situation were to radically deteriorate and his income to fall accordingly, a possibility expressly contemplated in clause 2.6 of the Agreement.

This understanding is entirely consistent with the review of the Agreement as a whole. [ 78 ] Nothing like that happened here. [ 79 ] At the time of the separation in January 2001, the appellant received an annual salary of approximately $300,000 which, after he was hired by a major law firm one year later, rose to $550,000. [45] And his financial situation did not deteriorate thereafter.

In 2012, his total income was $663,219.06, [46] in 2013, $548,212.88 [47] and in 2014, $760,025. [48] The respondent contends that the appellant's income was undervalued. [ 80 ] In particular, the appellant's testimony shows that assets attributed to him personally or through his company total approximately $3.5 M. His ability to pay support to the respondent which, in addition, was deductible from his income, is clearly not in question. [ 81 ] For the year 2015, however, the appellant calculated his annual income to be $51,796. The judge wrote: [translation] [70] For the year 2015, Mr.

C. estimated his income at $51,796. This amount is comprised of interest and dividends on [Company

A]'s investments as well as interest on the capital owed to it by the law firm, minus corporate tax, which represents $25,432 for 2015. Mr. C. adds to this sum an amount of $10,000 in dividends that he intended to withdraw from [Company A] at the end of 2015. His income also includes the interest on his two personal investment accounts and his TFSA account, amounting to $16,364.05 for 2015. [ 82 ] We must go back to July 2003 [49] to understand the present circumstances.

At that time, the appellant, a chartered accountant and tax expert, reorganized his affairs as the trial judge explained: [translation] [56] Since July 2003, that is, after the divorce, 90% of the income that Mr.

C. received from his law firm employment was paid to his personal company [Company A] ([Company A]) and 10% was paid into his family trust, the beneficiaries of which are his two daughters and himself.. [ 83 ] The appellant has total control of these entities which have a juridical personality separate from his. [50] Their legality is not in question. [ 84 ] Moreover, the appellant does not make any withdrawals from his RRSPs, the value of which was $533,000 on October 31, 2015, nor does he claim benefits to which he is entitled from the Régie des rentes du Québec.

He chooses to grow them and draw a higher pension later. [ 85 ] On the other hand, he sold $1.35 M of [Company A]'s investments to expand his secondary residence, to purchase high-end furniture and to pay the support owing to the respondent. The judge concludes that the appellant [translation] "does not meet his needs with an income of only $51,796." [51] She decided that the capital withdrawals made by the appellant [translation] "to meet his usual needs" [52] must be considered as income. [ 86 ] Clearly, the appellant proposes a strict

interpretation of clause 2.3 of the Agreement. [ 87 ] This approach must be rejected because, in my point of view, it is, in this context, inconsistent with the parties' common intention manifested in the Agreement of March 2003. But there is more. [ 88 ] The respondent claims that the appellant did not act in good faith, notably by failing to have sufficient income to pay her the agreed monthly support of $3,500. [53] The judge did not accept this claim: [translation] [106] The Court considers that Mr. C. does not violate his duty of good faith when he withdraws his capital.

He can choose to add on to the cottage where he will live in two years. [107] Given that the parties did not provide for guaranteed minimum monthly support of $3,500 at the time of his retirement, as the Court concludes in the following section, the reduction in his income resulting in monthly support of less than $3,500 does not necessarily prove that he is breaching his duty to act in good faith. [108] Mr. C. made a justified personal choice.

The evidence does not show that this withdrawal was frivolous or a means of squandering his assets , which would have enabled the Court to conclude that his real reason for withdrawing this sum from the [Company A] portfolio was to decrease the support otherwise payable to Ms. C. ... [110] Thus, the evidence does not thus show that Mr. C. squandered his capital in order to avoid his support obligations toward Ms. C.. [111] Moreover, even if Mr.

C. had not withdrawn $600,000 plus tax from [Company A]’s capital, his income still would not have reached $126,000, which is the minimum income required to pay a monthly pension of $3,500. ... [119] The parties did not provide that Ms. C. would receive minimum monthly support of $3,500. [120] In the absence of such a guarantee, the Court cannot conclude that Mr. C. must ensure that he has sufficient income to ensure that one third of it is never less than $3,500 per month. ... [138] However, since good faith must be part of the

interpretation and application of each contract, if Mr. C. declares no income and does not pay any support , the Court could sanction this conduct as

an act of bad faith . [References omitted] [Emphasis added] [ 89 ] With respect, I am of the view that these conclusions are tainted by an error of law, that this error distorted the assessment of the facts and led the judge to wrongly conclude that the appellant was acting in good faith, as it ought to be understood in such matters. [ 90 ] Authors Baudouin and Jobin recall, on the subject of good faith, that it may be opposed to bad faith, that in addition to the traditional subjective understanding of bad faith attached to one who acts with malicious intent or, to a lesser extent, without right, the C ivil Code enshrines good faith in its objective sense , as stated by the Supreme Court in a trilogy: [translation]

132 – Good faith. Concept. Mandatory nature – One must first recall the subjective, traditional meaning of good faith . In fact, this first notion of good faith has two meanings in legal terms. The first is that which opposes good faith to bad faith: a person in good faith acts without malicious intent. Note that

article 2805 of the Civil Code sets out a general and rebuttable presumption of good faith. The second traditional meaning of good faith is the ignorance or misperception of reality; a person who acts with the knowledge that doing so is illegal or illegitimate acts in bad faith. These two conceptions of good faith refer to the mental state of one who acts. The Civil Code provides a third meaning , which has been affirmed in a Supreme Court trilogy. This so-called objective good faith has a much broader meaning, that of an acceptable standard of behaviour.

Depending on the context, such standards may have a moral or social dimension, or they may simply refer to [translation] "common sense" or [translation] "reasonableness" . Good faith has thus become the ethical behaviour required in contractual matters (as in many others). It presupposes loyalty and honesty. Thus, we can speak of acting according to the requirements of good faith.

Consequently, a person may be of good faith (in the subjective sense), that is, by not acting maliciously or in ignorance of certain facts, and yet contravene the requirements of good faith, by violating objective and generally accepted standards of behaviour in society .

The courts must be commended for the remarkable accomplishment of shepherding the evolution of the central notion of good faith from a subjective to an objective notion, raising the spirit of our law from being purely individualistic law to a social standard ... [54] [Emphasis added] [ 91 ] Let us add that articles 6, 7 and 1375 C.C.Q. , key provisions, ensure that [translation] "both the principle of good faith and fairness and its principal applications are imperative". [55] Good faith must therefore govern the parties' conduct, particularly at the time the obligation is performed . [56] Consequently, it is the duty of each party [translation] "to act consistently so as not to disappoint the legitimate expectations of the co-contracting party", [57] at the risk of committing an abuse of right.

The unreasonable exercise of a right that is inconsistent with the conduct of a prudent and diligent person will constitute an abuse of right. [ 92 ] Thus, the judge commited an error in law in examining the appellant's conduct in the traditional subjective sense of good faith.

It is not a question of knowing whether he acted with malicious intent but whether his actions meet the acceptable standard of behaviour in accordance with so-called objective good faith and whether his actions are reasonable, loyal and honest. [ 93 ] This question must be answered in the negative. [ 94 ] The appellant arranged his affairs so that he could, in large part, decide whether he would receive income for a given year, in the usual sense of the term, and what that income level would be.

Once he did this, and was about to retire, he minimized his income without regard to the support obligation owed to the respondent and now advocates a restrictive

interpretation of the disputed clause in their Agreement. In sum, the extent of the obligation assumed by the appellant under the Agreement would henceforth be determined by the debtor. [ 95 ] Thus, the respondent, who received annual support of almost $113,000 in 2014 and expected it to be reduced to $42,000 when the appellant retired, had to manage with about $17,400 since January 1, 2015.

What is more, each year she would have to ask the appellant for documents and information that would enable her to determine the assets and [translation] "income" of his partnership and trust and to identify the yearly cash flows to learn, in particular, what withdrawals had been made. [58] [ 96 ] Once the data has been interpreted by an expert in the matter, the respondent would, in the event of a disagreement, again be required to go before to the court to determine what she is entitled to. And repeat the process the following year.

Such a scenario is inconsistent with what the parties were seeking in 2003 and with the objectives of certainty and finality so key to the Divorce Act . [59] [ 97 ] In my view, the appellant's actions reflect bad faith in the objective sense of the word and the result of the position he defends is unreasonable.

The appellant disregards the parties' common intention in the Agreement and the respondent's legitimate expectations and places her in a position where, ultimately, it would be extremely difficult for her to assert her right to support. [ 98 ] This is not the conduct of a prudent and diligent person respectful of his duties and of the respondent's rights. [ 99 ] To penalize reprehensible behaviour, particularly in contractual matters, the courts increasingly impose preliminary bars in a variety of situations where the principles of good faith and fairness so justify. [60] An individual, whether creditor or debtor, should not benefit from improper conduct.

Baudouin and Jobin conclude, in this regard: [translation] Thus, the courts have substantial discretion to apply the rule of fairness appropriately, and may extend it to new situations that arise before them, thereby ensuring better contractual justice. [61] [ 100 ] In my view, this rule must be applied to bar the appellant’s application based on the last part of clause 2.3 of the Agreement that stipulates [translation] "it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date." [ 101 ] Accordingly, I would dismiss the principal appeal and allow the incidental appeal, with legal costs in both cases, reverse the first instance judgment, bar the appellant’s application based on the last part of clause 2.3 of the Agreement which stipulates [translation] "it being agreed that the annual support payable may never exceed one third (1/3) of the applicant's annual income as of that date", and order the appellant to pay the respondent monthly support of $3,500, from January 1, 2015, with legal costs against the applicant in first instance.

LOUIS ROCHETTE J.C.A.