Mizuguchi v. Mizuguchi, 2011 ONCJ 683

Milton Registry No. 448/10 DATE: 2011·VI·24 CITATION: Mizuguchi v. Mizuguchi , 2011 ONCJ 683 ONTARIO COURT OF JUSTICE RE: MIZUGUCHI, Dawn– Applicant (responding party) MIZUGUCHI, Robert – Respondent (moving party) BEFORE: Justice Sheilagh M.

O’Connell COUNSEL: Dawn Mizuguchi – Acting in person Robert McQueen - Counsel for the Respondent HEARD: 24 March 2011 E N D O R S E M E N T [ 1 ] JUSTICE O’CONNELL ( endorsement ):— This is my decision on a Motion to Change, dated October 4, 2010, brought by the respondent, Robert Mizuguchi, heard on March 24, 2011. [ 2 ] The respondent (moving party), seeks to vary the final order of Justice James D. Karswick of the Ontario Court of Justice, dated September 10, 2001.

On that date, Justice Karswick ordered that the applicant mother shall have custody of the two children of the marriage, with specified access to the respondent. He further ordered that Mr. Mizuguchi shall pay child support in the amount of $374.00 per month to the applicant mother for the two children, effective March 1, 2001. The support order was based on Mr. Mizuguchi’s annual income of $25,000.00, in accordance with the Child Support Guidelines for Ontario. Both parties were in Court and represented by counsel at the time the final order was made.

The final order was based on the final Minutes of Settlement agreed upon by the parties and filed with the Court. [ 3 ] Mr. Mizuguchi seeks the following in his Motion to Change the Final Order:

a) An order that the arrears of child support be expunged and set at zero;

b) An order terminating the ongoing child support;

c) In the alternative, an order that the child support ordered be substantially reduced;

d) An order that he be granted access to the children in Ontario for six weeks each summer, alternating Christmas school breaks, and alternating spring breaks. [ 4 ] The children subject to the order are Christopher Randolph Mizuguchi, born December 1, 1994 and Thomas Ryan Mizuguchi, born January 22, 1997. Christopher is 16 years old and Thomas is 14 years old. The responding party, Ms Dawn Mizuguchi resides in

Newfoundland and the moving party, Mr. Mizuguchi resides in Georgetown, Ontario. At the time the Motion to Change was brought, both children of the marriage were residing in Newfoundland with Dawn Mizuguchi. Ms Mizuguchi was served with Mr. Mizuguchi’s Motion to Change and she filed responding materials. [ 5 ] As the children and the responding party were residing in Newfoundland at the time the motion was brought, and Mr. Mizuguchi was also seeking to change the custody and access terms of the Order of Justice Karswick, Ms Mizuguchi originally challenged the jurisdiction and procedure taken by Mr. Mizuguchi.

She argued that the motion to change the child support provisions should have been brought by way of a variation application under the Interjurisdictional Support Orders Act (“ISOA”), and that the motion to change the custody and access provisions should have been brought in Newfoundland since that was the children’s ordinary residence at the time.

Newfoundland is a reciprocating jurisdiction under the ISOA and this court has jurisdiction to consider the variation of an Ontario provincial court order made under provincial legislation. [ 6 ] However, upon the return of this matter on January 18, 2011, the parties had resolved the issues of custody, access and ongoing child support, and had reached final minutes of settlement which are as follows:

a) The applicant mother shall have custody of Thomas;

b) The respondent father shall have custody of Christopher;

c) Commencing October 1, 2010, there shall be no child support payable between the parties based on the Applicant’s annual income of $23,900.00 per annum and the Respondent’s annual income of $20,800.00 per annum. [ 7 ] Further, the parties also agreed, applying the factors set out by the Court of Appeal in Jasen v. Karassik , 2009 ONCA 245 , 95 O.R. (3d) 430, 248 O.A.C. 5, 306 D.L.R. (4th) 723, 62 R.F.L. (6th) 63, [2009] O.J. No. 1175, 2009 Cars​well​Ont 1507 (Ont. C.A.), that this Court did have jurisdiction to determine the sole outstanding issue of the arrears owed by Mr.

Mizuguchi under the Order of Justice Karswick, by way of the Respondent’s Motion to Change, on condition that Ms Mizuguchi was entitled to participate in this hearing by way of a telephone conference call, given the expense and difficulty in travelling from Newfoundland to Ontario. [ 8 ] Under Rule 15 , a motion to change a final order shall be dealt with on the basis of the documentary evidence filed, unless the court is of the opinion that it cannot properly be dealt with in this fashion.

This court was of the opinion and the parties agreed that the motion to change the hearing could proceed by way of affidavit and documentary evidence filed. [ 9 ] The sole issue to be determined therefore was the amount of child support arrears, if any, that is owed by Mr. Mizuguchi, pursuant to Justice Karswick’s Order. The final issue was then adjourned to March 24, 2011 for a hearing. Mr. Mizuguchi’s claim: [ 10 ] As of March 24, 2011, the amount of unpaid support arrears was approximately $23,005. 14, according the Statement of Arrears received by Mr. Mizuguchi from the Family Responsibility Office.

Since November 1, 2010, Mr. Mizuguchi has been paying $250.00 per month towards the arrears. [ 11 ] Mr. Mizuguchi claims the following:

a) Even though he agreed that his income was $25,000.00 per annum when he signed the Minutes of Settlement in 2001 in the presence of his counsel, since the date of the order, he has not made that amount of money each year;

b) On or about July of 2004, Mr. Mizuguchi had major surgery for a cervical spine fusion, and as such, he was unable to work for approximately two and one-half years, and he has been unable to work full-time since that time as a result of his spinal condition;

c) On or about June 12, 2010, he was in a car accident in which his car was rear-ended which exacerbated his spinal condition;

d) He has only recently begun receiving statutory accident benefits from his insurance company at a rate of $400.00 per week or $20,800 per annum;

e) Between October 1, 2001 to September 1, 2003, Mr. Mizuguchi was working for TS Towing in Brampton, Ontario. TS was supposed to be remitting his child support to the Family Responsibility Office during that period of time and failed to do so. Mr. Mizuguchi calculates the amount that was not remitted by TS Towing, which has since gone bankrupt, to be $8,254.00; [ 12 ] Mr. Mizuguchi’s owned and operated a towing service company for many years and lives with his common law spouse, who also works for a towing company, J.A. Towing. Her income is $3,833.00 per month, or $45,996.00 per annum, according to Mr.

Mizuguchi’s sworn financial statement filed. [ 13 ] A review of the financial evidence filed by Mr. Mizuguchi indicates that his income for child support purposes has been the following since 2001: Reported Income: 2010 $20,800.00 2009 20,382.00 2008 8,849.00

2007 17,212.002006 10,919.002005 1,045.002004 9,961.002003 79.002002 3,002.002001 19,163.00 [14] Based on the documents filed by Mr. Mizuguchi, he should therefore be paying the following child support for the years he isseeking a reduction, and for which he paid no child support to Ms Mizuguchi: Child Support Owed: 2010 $2,871.002009 3,696.002008 168.002007 3,384.002006 1,200.002005 02004 732.002003 02002 02001 3,564.00Total $15,615.00 [15] Therefore, if we accept the financial documents filed by Mr. Mizuguchi at face value, the total arrears owing by Mr.

Mizuguchiunder the Order of Justice Karswick, even taking into account his reduced income since his operation and spinal injury, is $15,615.31.During some of those years, Mr.

Mizuguchi was reporting the professional net income from his business to be only $7,400.00 in 2009approximately $8,800.00 in 2008. [16] In a motion to change, the moving party only has to show a change in circumstances (not a material change) within the meaningof the Child Support Guidelines or that evidence not available on the previous hearing has become available (subsection 37 (2.1) of theFLA) to successfully change a child support order. [17]

Section 14 of the Child Support Guidelines sets out the circumstances that must be proven in order to warrant a variation. Theburden of proof lies upon the moving party, on a balance of probabilities, to establish a change in circumstances that would result in adifferent order. See Jardine-Hynds v. Grant, 2009 ONCJ 133, 176 A.C.W.S. (3d) 183, [2009] O.J. No. 1444, 2009 Cars​well​Ont 1858(Ont. C.J.). [18] In my view, Mr.

Mizuguchi has demonstrated a change in circumstances which warrant a review of the Order of JusticeKarswick, particularly in light of the medical evidence filed regarding his surgery and treatment for his spinal disability during the periodof 2004 to 2006, which affected his ability to work during that time period. [19] However, there are some discrepancies with the financial evidence filed by Mr. Mizuguchi. According to his Notice ofAssessment for 2003, Mr. Mizuguchi claimed his total T-4 earning for that 12 month period in 2003 was only 79.00. However, this wasduring the period that he was working at T.S.

Towing, and according to the Affidavit sworn by Carla Willier of the FamilyResponsibility Office, dated November 18, 2010, Mr. Mizuguchi advised the Family Responsibility Office in 2003 that his net wages atT.S. Towing during that period were between $500.00 and $600.00 per week or approximately between $25,000.00 and $31,000.00 peryear. Furthermore, in 2002, Mr. Mizuguchi stated that he was working for T.S. Towing, presumably at the same rate of pay, and hedeposed that he thought the company was remitting his child support directly to the Family Responsibility Office during that period.

Heis seeking to have his arrears reduced by the sum of $8,752.00, which is the amount he claimed the company was deducting from his paycheques during the above time period. However, in 2002, Mr. Mizuguchi only declared $3,000.00 as his total T4 earnings according tohis 2002 Notice of Assessment. [20] Furthermore, for the periods of time that Mr. Mizuguchi was operating his own towing company, he does not provide anyexplanation for the business expenses that he deducted from the gross business income reported, which was, for example, $20,382.73 in2009.

A review of the statement of expenses filed with his 2009 income tax return indicates that Mr. Mizuguchi deducted a total of$7,900.00 in management and professional fees, $8,483.94 in vehicle expenses, which he admitted during submissions, was also for hispersonal use, and $726.00 for meals and entertainment. [21] A self-employed person has the onus of clearly demonstrating the basis of his or her net income. This includes demonstratingthat the deductions from gross income should be taken into account in the calculation of income for support purposes. See Whelan v.O’Connor, , 28 R.F.L. (6th) 433, [2006] O.J.

No. 1660, 2006 Cars​well​Ont 2581 (Ont. Fam. Ct.). This principle alsoapplies where the person’s employment income is derived from a corporation that he or she fully controls. See MacKenzie v. Flynn,2010 ONCJ 184, [2010] O.J. No. 2145, 2010 Cars​well​Ont 3450 (Ont. C.J.).

[22] The self-employed have an inherent obligation to put forward not only adequate, but comprehensive records of income andexpenses, from which the recipient can draw conclusions and the amount of child support can be established. See Meade v. Meade, , 31 R.F.L. (5th) 88, [2002] O.J. No. 3155, 2002 Cars​well​Ont 2670 (Ont. S.C.). The onus rests upon the parent seeking todeduct expenses from income to provide meaningful supporting documentation in respect to those deductions, failing which an adverseinference may be drawn. See: Orser v. Grant (2000), 96 A.C.W.S. (3d) 644, [2000] O.J.

No. 1429, 2000 Cars​well​Ont 1354 (Ont. S.C.) [23] If I attribute the amount of earnings Mr. Mizuguchi claims to have received from T.S. Towing between 2001 and 2003, then Mr.Mizuguchi’s earnings during that period would increase his child support obligations conservatively to $8,976.00 (374. x 12 for twoyears, based on an income of $25,000.00), for a total arrears owing of $24,591.00. I do not accept that Mr. Mizuguchi’s income duringthat period was only $79.00 for 2003 and $3,000.00 for 2002. [24] Mr. Mizuguchi claims that during that same period, T.S.

Towing was deducting 50 percent of his net wages and claims that thesepayments were being remitted to the Family Responsibility Office. A review of the Affidavit filed by the Family Responsibility Officedoes indicate that on September 25, 2001, a support deduction notice was issued to T.S. Towing and on that date the arrears owing were$2,624.53. The Affidavit also confirms that FRO enforcement officers had at least two telephone conversations with a payroll personfrom T.S. Towing, who advised FRO that the company was remitting at least 50 percent of Mr. Mizuguchi’s wages to FRO.

However, itis clear from the documents filed by FRO, that those payment were not being remitted by T.S.Towing. By 2002, the Statement ofArrears filed by the Family Responsibility Office indicates that the arrears had now increased to $7,512. 53. [25] According to the Affidavit of Mr. Mizuguchi, the company had deducted child support payments from the wages of at least fourother employees and failed to remit to the Family Responsibility Office. The company has since gone bankrupt and Mr.

Mizuguchi hasnot been able to obtain access to their bankroll records. [26] Pursuant to s.41 (9) of the Family Responsibility and Support Arrears Enforcement Act, the Statement of Arrears prepared by theDirector is presumed to be correct, unless rebutted by evidence from the payor. [27] I am satisfied, based on the evidence, that Mr. Mizuguchi has rebutted the presumption that the Statement of Arrears accuratelyreflects the arrears owing. It does not. Mr. Mizuguchi never remitted the child support to the Family Responsibility Office during thatperiod.

However, it is equally true that Ms Mizuguchi never received any child support from Mr. Mizuguchi during that period, throughno fault of Mr. Mizuguchi. Even though Ms Mizuguchi never received those child support payments, Mr. Mizuguchi did remit thepayments to his employer. I therefore deduct the amount of $8,976.00 from the amount of arrears owed by Mr. Mizuguchi and fix thearrears owed by Mr. Mizuguchi at $15, 615. However, that does not end the analysis. [28] The Court of Appeal indicates that the discretion to reduce arrears must be exercised judicially; DiFrancesco (Couto) v.

Couto,, 56 O.R. (3d) 363, 155 O.A.C. 32, 207 D.L.R. (4th) 106, [2001] O.J. No. 4307, 2001 Cars​well​Ont 3858 (Ont. C.A.)sets out the factors to be considered: (

i) the nature of the obligation to support, whether contractual, statutory or judicial; (ii) the ongoing financial capacity of the payor; (iii) the ongoing need of the custodial parent and the dependant child; (iv) unreasonable and unexplained delay on part of the custodial parent in seeking to enforce payment of the obligation,tempered, however, in the case of child support with the fact that such support exists for the child’s benefit, is charged with acorresponding obligation to be used by the custodial parent for the child’s benefit and cannot be bargained away to the prejudice of thechild (

v) unreasonable and unexplained delay on the part of the payor in seeking appropriate relief from his obligation; and (vi) where the payment of substantial arrears will cause undue hardship , the exercise of the court’s discretion on looking at thetotal picture, weighing the actual needs of the custodial parent and child and the current and financial capacity of the respondent, to granta measure of relief where deemed appropriate. [29] In this case, Mr.

Mizuguchi has offered no explanation as to why he waited until 2010, approximately ten years later, to seek tovary and reduce the arrears, particularly when his back-related injury and operation occurred approximately six years ago. [30] Further, Ms Mizuguchi cannot be faulted for any delay in enforcement. A recipient who files a support order with the FamilyResponsibility Office cannot be faulted for any lack of diligence by that agency in pursuing enforcement of a court order: see Gallowayv. Casino (Barrett), 2008 ONCJ 577, 172 A.C.W.S. (3d) 444, [2008] O.J. No. 4525, 2008 Cars​well​Ont 6740 (Ont. C.J.).

Ms Mizuguchidid not receive the child support for the time in question and she sought enforcement thought the Family Responsibility Office. She hasalso clearly established need, based on her current income and the fact that she is a single parent earning a very modest income. [31] However, in looking at Mr. Mizuguchi’s ongoing capacity to pay the arrears owing, he is also now the custodial parent of one ofthe children and his income has been reduced to approximately $20,800.00 per annum, which is based on his statutory accident benefits. In my view, the payment of substantial arrears will cause undue hardship.

I [32] In weighing the needs and financial capacities of both parents, who are both custodial parents, I therefore reduce the arrears ofchild support owing by Mr. Mizuguchi to $10,000.00, to be paid at a rate of $200.00 per month, until all arrears are paid in full. Order: [33] I therefore make the following order:

[ 34 ] The arrears owed by Mr. Mizuguchi pursuant to the Order of Justice Karswick, dated September 10, 2001 shall be reduced and fixed in the amount of $10,000.00, effective November 1, 2010, and payable at a rate of $200.00 per month, until the all arrears are paid in full. ___________________________ Justice Sheilagh M. O’Connell DATE: 24 June 2011