2014 QCCA 123, 2014 QCCA 123

Unofficial English Translation Droit de la famille — 1487 2014 QCCA 123 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-023618-135 (500-12-308811-110) DATE: January 23, 2014 CORAM: THE HONOURABLE FRANÇOIS PELLETIER, J.A. MARIE ST-PIERRE, J.A. CLAUDE C. GAGNON, J.A. H. C. APPELLANT – Plaintiff v. G. B. RESPONDENT – Defendant JUDGMENT [ 1 ] The appellant appeals from a judgment of the Superior Court, District of Montreal (the Honourable Mr.

Justice Richard Nadeau) rendered on May 2, 2013, that granted divorce, awarded her custody of the minor child, ordered the respondent to pay her spousal support and child support, specified the conditions applicable to the special expenses relating to the children , cancelled the arrears due from the respondent, and effected the partition of the family patrimony. [ 2 ] For the reasons of St-Pierre, J.A., with which Pelletier and Gagnon, JJ.A. agree, THE COURT: [ 3 ] ALLOWS in part the appeal for the sole purposes of: • replacing the conclusions in paragraphs 90 and 93, which read as follows : [ translation] [90] ORDERS Mr.

B. to pay Ms. C. the amount of $2,500 a month for herself, an amount that is taxable for Ms. C. and deductible for Mr. B., up to and including September 1, on condition that Ms. C. may request an extension of such support if her health deteriorates; [93] In this regard, DECLARES that the value of Mr. B.’s share of the equity in the former family residence of the parties is worth $141,046.50 and ORDERS Ms. C. to pay Mr. B. this amount within a maximum of 90 days, without interest; with the following conclusions : [90] ORDERS Mr. B. to pay Ms.

C. the amount of $2,500 a month for herself, an amount that is taxable for Ms. C. and deductible for Mr. B., up to and including September 1, but reserves Ms. C.’s right to return to court if the situation warrants it; [93] In this regard, DECLARES that the value of Mr. B.’s share of the equity in the former family residence of the parties is worth $66,456.77 and ORDERS Ms. C. to pay Mr. B. this amount within a maximum period of 90 days, without interest; And • adding conclusions 95 A and 95 B below :

[95 A] DECLARES that, as between Ms. C. and Mr. B. only, Ms. C. and Mr. B. will each assume 50% of the balance of the BMO credit card, Ms. C. will assume alone the balance of her line of credit and Mr. B. will assume alone the balance of his line and of his Amex and Amex Holt credit cards. [95 B] DECLARES that the RRSP loan ($29,876.95) and the resulting RRSP ($30,000) will be divided 50/50, TAKES NOTE of the parties’ undertaking to sign, as needed and without delay, any document required for this purpose, and ORDERS THEM to act accordingly. [ 4 ] Without costs. FRANÇOIS PELLETIER, J.A. MARIE ST-PIERRE, J.A.

CLAUDE C. GAGNON, J.A. Mtre Robert Desmarais DESMARAIS & HARGREAVES For the appellant Mtre Suzanne Fortin PRÉVOST FORTIN D’AOUST For the respondent Date of hearing: December 12, 2013 REASONS OF ST-PIERRE J.A. [ 5 ] To make the corrections sought jointly by counsel for the parties because of errors or inaccuracies in the judgment, but for which they together assume responsibility, and to take into account the contributions made by the appellant from a gift and an inheritance under

article 418 C.C.Q ., I am of the opinion that the appeal should be allowed in part, but without costs. [ 6 ] I shall explain. [ 7 ] The appellant raises ten grounds of appeal: First ground : The judge’s reasons are insufficient; Second ground : The judge erred in fact by stating that the respondent’s income was $123,000 for 2012; Third ground : The judge erred by fixing child support at $1,303.33 a month; Fourth ground : The judge erred by setting September 1, 2013, as the termination of the appellant’s spousal support; Fifth ground : The judge erred by cancelling the accumulated arrears of support; Sixth ground : The judge erred in law by rejecting the deed of assignment of equity in the family residence signed by the respondent in favour of the appellant; Seventh ground : The judge erred by including the $76,615.16 gift and the $30,000 inheritance in the partitionable value of the family residence; Eighth ground : The judge erred by not effecting an unequal partition of the family patrimony; Ninth ground : The judge erred by refusing the $50,000 compensatory allowance claimed.

Tenth ground : The trial judge erred in law and in fact by effecting the partition of debt. [ 8 ] The interventions I propose here relate to the issues raised in the fourth, seventh and tenth grounds. On all the other grounds, the appeal should be dismissed. [ 9 ] Regarding the fourth ground, the respondent acknowledges that he did not seek to have a time limit imposed on the appellant’s

right to support but simply a finding that he had been entitled to stop paying support to the appellant since the end of September of 2013 and until otherwise ordered. [ 10 ] Regarding the seventh ground, which I will consider in greater detail in the analysis of my reasons, I am of the opinion that the appellant’s argument that she is entitled to a certain deduction under

article 418 C.C.Q . should be accepted. [ 11 ] Regarding the tenth ground, since the appellant and the respondent acknowledge that there will be no partition of the debts unless I accept the sixth ground of appeal, which is not the case, the intervention of this Court is warranted.

Main events in the parties’ married life [ 12 ] At the end of the 1980s, the appellant and the respondent, with degrees in speech-language pathology and psychology respectively, practised their professions at the same private general clinic and became de facto spouses. [ 13 ] At the time, the appellant was single and the respondent was married and the father of a son born in 1980, but in the process of divorce.

The divorce judgment was not granted until February 1995. [ 14 ] In July 1990, they bought a property for $180,000 of which they became co-owners in equal shares: this was the family residence, one of the issues in this appeal. [ 15 ] Two children were born from their union: a boy, born on …, 1993, and a girl, born on …, 1995.

According to the plan they had agreed on, when their first child was born, the appellant stopped practising her profession and devoted herself entirely to the family and managing many of the aspects of the respondent’s professional practice, as he required assistance because he has been totally blind since the age of 14. In paragraph 11 of his judgment, the judge wrote: [ translation] “Ms.

C. was his eyes, his calendar, his assistant and his accountant, as well as the main manager of the family home.” [ 16 ] On July 20, 1995, the respondent assigned the appellant his share of the property purchased in co-ownership in 1990 (the family residence at the time of the divorce). The respondent’s main objectives were to protect the appellant financially as well as compensate her for leaving her career to look after the family and to repay her the amounts he owed her ($29,473.51). [ 17 ] One year later, on July 20, 1996, the appellant and the respondent married.

They adopted the matrimonial regime of separation as to property. [ 18 ] While the business income available to meet the family’s needs was limited to that generated by the respondent, the parties decided to report only a portion of it to the tax authorities. The fact that this income was regularly received in cash made it easier to do. According to the evidence, this was the way they dealt with more than half of the business income generated by the respondent over the years. [ 19 ] The appellant is from a relatively well-off family.

Over the years, she received various sums of money from her parents, including $30,000 as an inheritance from her mother in April of 2004, $76,616.56 as a gift from her father in October of 2005, and $171,000 as a life insurance benefit in April of 2009, after her father’s death. [ 20 ] The appellant and the respondent did work or had work done on the family residence, notably in 2004 and 2005. [ 21 ] Although the evidence shows that the couple’s married life and family life were not free from difficulties over the years, it was not until the end of 2009 that the relationship fell apart, when the respondent had to answer to the syndic of his professional order after a complaint of sexual misconduct was filed by one of his clients. [ 22 ] At first, the respondent denied everything.

The appellant believed him and joined him in fighting the complaint. A few months later, informed of the evidence that the syndic had against him, the respondent chose to admit his misconduct. [ 23 ] As to what happened next, because of certain issues raised in the appeal, it is appropriate to reproduce here, word for word, the judge’s findings with respect to this period of the parties’ lives. [ translation] [17] Outraged, hurt and incredulous, she confronted Mr.

B. and ordered him to talk to the children about the matter, given the potential risks, for them as well, of the negative publicity, and then to plead guilty, which he did, and which resulted in a three-month suspension from the end of December of 2010 to February of 2011. [18] The relationship of trust was destroyed! [19] After several months of reflection and hesitation, Ms. C. informed Mr. B., who was devastated, that she wanted to end their relationship and that she wanted him to leave the family residence as of January of 2011. [20] She offered to train a new resource person to help Mr.

B. manage his business, given that he could not do it himself because he is totally blind. [21] He managed to convince her to put off kicking him out by several months, but on May 4, 2011, she asked him to leave, which he did. He went to stay with a colleague and his wife until the summer, when he rented a furnished apartment with his son X. [22] One of the ways he tried to coax Ms. C. into letting him stay in the home was to dictate an undertaking to her, in which he assigned his entire share of the equity in the house, [ translation] “freely and with full knowledge of the facts” ( P-8 ). We will discuss this

document and its validity later. [23] Without warning, Ms. C. served him with the motion to institute proceedings at his professional office, which he complained about before the undersigned. [24] The parties signed an initial interim consent on June 27, 2011, by which Mr. B. undertook to pay the sum of $1,145 a month for the children and $6,000 a month for Ms. C., who maintained use of the residence to the exclusion of himself. [25] Mr. B. also assumed the payment of the school taxes still due as well as Ms. C.’s auto insurance, along with the taxes she would have to pay on her spousal support.

All in all, quite a generous contribution! [26] This consent, duly confirmed several times, was to extend until there was an inquiry as soon as possible. Unfortunately for Mr. B., it took a year before he could make his representations to Sophie Picard J., who rendered judgment on June 20, 2012 on an interim motion. [27] In it, she reduced the child support payments to $1,301.67 a month and the spousal support for Ms. C. to $3,800, to take effect as of the judgment. [28] It should be noted that, apart from the arrears of $13,814 that apparently accumulated between June 2011 and May 2012, when Mr.

B. was having significant problems meeting all the financial expenses he had assumed since the marriage breakdown so as not to penalize his family, he has always fully honoured his commitments to the present day.

The judgment under appeal [ 24 ] After summarizing his understanding of the main facts of the parties’ life together, the judge determined the matters in dispute. [ 25 ] Once this had been done, he began his analysis of the points giving rise to the dispute by considering the income of the respondent that should be taken into account to determine the child and spousal support owing. [ 26 ] First, he found that the evidence established beyond a shadow of a doubt the parties’ practice of reporting only part of the income to the tax authorities. [ 27 ] Second, he accepted the respondent’s testimony that he had to cut down on his work following the complaint against him with his professional order and the marriage breakdown.

In the judge’s opinion, this was not a tactic by the respondent to evade his obligations because he was [ translation] “convinced of the good faith of Mr. B. (the respondent), who says that he wants to continue to help his family as best he can and who has proved this many times over while the couple was living together and after”. [ 28 ] Finally, he determined the net professional income to be $123,000 annually, after expenses. [ 29 ] Regarding child support, in accordance with what the parties had asked him to do for the first year, the judge set the amount as if the appellant had no income.

In this regard, he wrote: [ translation] [49] To determine the child support, the court must take into account the income of both parents if they both work. [50] Here, with great courage and determination and possibly with major health problems in the background, Ms. C. asked to be readmitted to her professional order and had to requalify, update her training, take examinations, etc. [51] She was authorized to resume her practice as a speech-language pathologist and decided to open a private practice in the hope of building up a client base and referral network.

Her results in the first months have been encouraging, although she has not finished absorbing her set-up expenses. She expects to be self-supporting as of September, provided, of course, that her health does not deteriorate. [52] The defendant agrees not to attribute any income to Ms. C. until next year for the purpose of calculating child support.

He does request, however, and the court agrees, that every year, after the income tax returns are filed and the notices of assessment are received from the tax authorities, as applicable, that the parties exchange these figures to determine the child support to be paid retroactively to January 1. [53] Thus, according to

Schedule 1 submitted at the inquiry (D-38), the basic support payment to be made by Mr. B. would be $1,303.33 monthly, until such amount is modified. [54] In addition, there are school fees and education-related expenses, as well as expenses not covered by the basic amount fixed above. These will be payable in proportion to each party’s income after their deductible professional expenses. Ms. C. shall advise Mr. B. and provide him with all information, accounts and bills in advance or on receipt, so that he can send her or the creditor directly the amounts required from him. [55] Mr.

B. also undertook to maintain health and accident insurance coverage for the children. [ 30 ] Regarding the spousal support payable by the respondent to the appellant, the judge wrote:

[ translation] [56] As stated, Ms. C., with courage and determination, decided to resume her work as a private speech-language pathologist. She opened an office and is starting to earn income which, if the trend continues, should allow her to become independent by fall. She is asking for assistance until then, however. Mr. B. is willing to provide assistance, but for a shorter period. [57] On the basis of discussion with counsel and the testimony of the parties in this regard at the inquiry, the amount should be between $2,000 and $3,000 a month until September, according to Ms. C., and June, according to Mr.

B. [58] The Court finds that Ms. C. will require assistance until the end of September, when her potential clients will be returning from vacation and schools will be starting up again after the summer. [59] Mr. B. is therefore ordered to pay Ms. C. the amount of $2,500 a month until the end of September 2013, as of this judgment. If, however, in the meantime Ms.

C. experiences significant health problems that prevent her from working, she must appeal before the court. [ 31 ] The conclusion of the judgment regarding the respondent’s obligation to pay spousal support for the appellant is as follows: [ translation] [90] ORDERS Mr. B. to pay Ms. C. the amount of $2,500 monthly for herself, an amount that is taxable for Ms. C. and deductible for Mr. B., up to and including September 1, on condition that Ms.

C. may request an extension of such support if her health deteriorates; [ 32 ] Regarding the estimated arrears of $13,814, the judge found that they should be cancelled because of the [ translation] “very significant financial efforts” the respondent had made since the parties ceased living together to maintain the family’s lifestyle even though he clearly did not have the means. [ 33 ] The judge found that the partitionable value of the family residence (the only genuine asset composing the family patrimony of the parties), which he estimated to be $282,093, should be partitioned in equal shares.

He dismissed the arguments that there were grounds to recognize that the family residence belonged entirely to the appellant under the terms of an agreement to this effect dated January 27, 2011, or, at the very least, that a larger share of it belonged to her because of her contributions through a gift and an inheritance. [ 34 ] Finally, dealing with the other issues advanced by the parties along the way (during proceedings or at trial, including during arguments), the judge wrote: [ translation] [81] That finally leaves the argument regarding a certain form of compensatory allowance for Ms.

C., who stayed home to look after the children and Mr. B. [82] As we have already seen, however, while Ms. C. certainly helped Mr. B. manage his practice, she was more than rewarded, not only through the sharing of the taxable income, but also, and above all, by almost unlimited access to the hidden income she was happy to spend during the many years she pushed Mr. B. to achieve a high level of performance to keep him out of the house, but above all to have more to spend. [83] She was more than generously paid for her contribution to Mr. B.

She does not deserve more, especially through a partition of the patrimony in her favour, which she would like to be unequal. [84] The patrimony shall therefore be partitioned equally, both the assets, i.e., primarily the equity in the former family residence, and the liabilities, pursuant to the Act. [85] And since neither Ms. C. nor Mr.

B. has sufficient financial means to buy the other party’s share of the equity while each assuming their share of the household debts to be repaid, the Court considers that the former family residence should be sold so that the net proceeds of the sale may be used to settle the patrimony.

ANALYSIS General remarks [ 35 ] The judge’s comments, some of his choice of words, or the repeated use of exclamation marks might lead the reader of the judgment to believe that the appellant was the only or at least the main person responsible for the lack of assets owned by the parties at the time of the marriage breakdown and their state of indebtedness. This is not the case, however. Counsel for the respondent, with the respondent’s consent, acknowledged this before us at the hearing, and in no uncertain terms: reaching that conclusion would be a mistake.

That is why, from the outset, I felt it essential to insert this paragraph into my reasons to expressly correct such an impression, if that was the one received. [ 36 ] That being said, the remaining issues concern family matters relating to support, the partition of the family patrimony, and other financial consequences following the marriage breakdown. The facts and credibility are at the core of the judge’s analysis and deference is owed, [1] save in the case of palpable and overriding error or an error in law. First ground: Insufficient reasons

[ 37 ] In my opinion, this ground of appeal is unfounded. [ 38 ] As the Supreme Court writes in Vuradin : [10] An appellate court tasked with determining whether a trial judge gave sufficient reasons must follow a functional approach : R. v. Sheppard , 2002 SCC 26 , [2002] 1 S.C.R. 869, at para. 55 . An appeal based on insufficient reasons “will only be allowed where the trial judge’s reasons are so deficient that they foreclose meaningful appellate review” : R. v.

Dinardo , 2008 SCC 24 , [2008] 1 S.C.R. 788, at para. 25 . … [15] The core question in determining whether the trial judge’s reasons are sufficient is the following : Do the reasons, read in context, show why the judge decided as he did on the counts relating to the complainant? … [2] [Bold and underlining added.] [ 39 ] In the present case, the reasons of the trial judge are sufficient: considered in context, they indicate why the judge reached the conclusions he did for each of the issues in dispute and they permit meaningful appellate review.

Second ground: The respondent’s income [ 40 ] This ground of appeal must also be dismissed. [ 41 ] The judge knew that the respondent did not report all of his income to the tax authorities for many years. He was entirely aware of all of this evidence when, at paragraph 35 of his judgment, he wrote: [ translation] [35] Ms.

C. offered a considerable amount of evidence, which was moreover uncontested, with supporting tables and tax returns, for at least a certain number of years, which clearly showed the cash inflows, hidden or reported, from which the parties amply benefited, as previously said. [ 42 ] The reasons the judge accepted an income of $123,000 are outlined in paragraphs 40 to 43 of the judgment: [ translation] [40] Ms. C. therefore bases her monetary demands on the lifestyle and cash inflows in which she was a stakeholder, if not the main instigator. She would like the Court to compel Mr.

B. to maintain his former pace of work, even though he is now 60 years old and is experiencing certain health problems, as Ms.

C. is as well, moreover, and especially even though he claims that he lacks the peace of mind needed to continue as before, to the same extent as before. [41] The defendant has decided to reduce the number of hours in which he sees clients but he believes he will continue to earn around $123,000 a year, after office-related expenses, while having to absorb considerable debt that he did not generate alone and for which he is not the only one responsible, on the contrary, even though up until now he has been the only one to pay it, to the best of his ability. [42] The Court is convinced of the good faith of Mr.

B, who says that he wants to continue to help his family as best he can and who has proved this many times over while living with Ms. C. and after. This is not a deliberate tactic to lower his income to reduce his responsibility towards Ms. C and the children. [43] The above-noted amount will therefore be used to determine the child support payments to be made, subject to any future adjustments depending on Mr. B’s earnings. [ 43 ] The above comments of the judge are supported by the evidence.

Deference is owed because the appellant has not managed to demonstrate a palpable and overriding error on the part of the judge. Third ground: Quantum of child support [ 44 ] This ground of appeal is directly related to the previous one (establishing the respondent’s income) and it therefore must have the same outcome. Fourth ground: Spousal support for the appellant [ 45 ]

Section 15.2(3) of the Divorce Act [3] allows the court to limit the duration of a spousal support order or to impose terms, conditions or restrictions as it thinks fit and just.

(3) The court may make an order under subsection (1) or an interim order under subsection (2) for a definite or indefinite period or until a specified event occurs, and may impose terms, conditions or restrictions in connection with the order as it thinks fit and just. [ 46 ] The applicable principles were set out by this Court in B. (M.) v . D. (J.-C.) [4] , M.-C.B. v . C.G. [5] , Droit de la famille — 09408 [6] and Droit de la famille — 131708 . [7]

[ 47 ] According to the argument submitted by her counsel, the appellant believes that the judge did not impose simple terms, conditions or restrictions on the spousal support but rather that he limited the period of support. As a result, she fears that the judgment could extinguish her right to spousal support.

Having been off the job market for a substantial number of years, and with her precarious health making it difficult to foresee what the future holds, she would like to ensure that her rights are reserved, not extinguished. [ 48 ] The respondent understands the appellant’s concern and does not object whatsoever to the reservation of her rights. In fact, that is how he interprets the judgment. In his factum, he writes: [translation] 4. Reservation of spousal support for Ms. C 30.

It is important to specify that the honourable trial judge did not terminate the APPELLANT’S spousal support but rather imposed a term on the payment of it. … 31. In the same testimony, the APPELLANT stated that she had some income, that her office expenses would decrease and that she would be satisfied if she had spousal support until September in the amounts suggested. When questioned by her counsel, the APPELLANT also stated that it would be prudent to ask that her right to spousal support be reserved. This entire matter was also confirmed during the arguments of the parties’ respective counsel. 32.

As for the APPELLANT’s arguments that her health will not permit her to institute proceedings to vary corollary relief to obtain spousal support, if appropriate, this statement is completely speculative since her condition is currently stable. She is in good enough health to start up a private practice again as a speech-language pathologist, as she has chosen to do. She states that she can work and that the illness has not been an obstacle to her professional development. Incidentally, the RESPONDENT points out that no formal evidence of her medical condition was presented at the trial hearing. 33.

The reservation of the APPELLANT’s right to spousal support aims precisely to alleviate any potential health issues that could arise in her life. The trial judge did not commit any error in the present case.

Indeed, it is not contested by the RESPONDENT. [Citations omitted.] [ 49 ] This understanding was reiterated by counsel for the respondent before the Court, who argued that it would not be fair, in keeping with the law, or timely to limit the duration of the spousal support even though the judge was right in having the payments cease at the end of September of 2013 until otherwise ordered. [ 50 ] First, I shall again quote the conclusion of the judgment concerning the respondent’s support obligations toward the appellant: [translation] [90] ORDERS Mr. B to pay Ms.

C the amount of $2,500 monthly, an amount that is taxable for Ms. C and deductible for Mr. B, up to and including September 1, on condition that Ms.

C may request an extension of such support if her health deteriorates. [ 51 ] Second, if only because of the content of the appellant’s testimony, I find that the judge was right to set the quantum at $2,500 a month and to order that in principle these monthly payments cease at the end of September of 2013. [ 52 ] That being said, while it is true that the judge did not write that the respondent’s support obligation towards the appellant had terminated and that he left the door open in certain circumstances, and rightly so in fact, I do not find that it is clear that the wording that he chose to use is consistent with what the respondent wrote in his statement (excerpts reproduced above) and the position defended by counsel for the respondent before the Court. [ 53 ] I cannot ignore the fears expressed by the appellant and characterize them as frivolous. [ 54 ] In the circumstances, since I share the opinion that it is inappropriate to set a time limitation on the appellant’s right to spousal support under the Divorce Act , [8] the judge’s conclusion should be amended to clarify the situation and provide for the reservation of rights.

Fifth ground: Cancellation of arrears [ 55 ] The judge found that the respondent had made a very large contribution to the family’s financial needs during the marriage and since the separation of the parties. He noted the long period during which the respondent had been required to pay substantial sums until Picard, J. intervened, reducing his obligations significantly.

The trial judge also found that it was legitimate for the respondent to reduce his workload. [ 56 ] Given that the respondent had always stepped up to the plate and that the arrears represented only two months of contributions, the judge chose to cancel them. He explained: [translation] [60] As already noted above, Mr. B had always faithfully paid what he owed Ms.

C, including taxes for 2011 on the spousal and child support, except during a short period when he encountered serious difficulty in paying the support established by the court, for total arrears of less than two months of support. [61] Thus, except for the arrears totalling $13,814, Mr. B is up to date in all his payments. He asks the court to waive payment thereof, whereas Ms. C. insists on receiving payment in full.

[62] The evidence has revealed that Mr. B had agreed to pay large amounts on an interim basis, expecting the case to proceed quite quickly. Unfortunately, more than a year passed before he could make his submissions before Picard, J., who, as we have seen, considerably reduced the spousal support to Ms. C, whose out-of-control spending habits had nevertheless continued, as amply shown by the table she produced, honestly but naively, which is eloquent proof thereof (P-26). … [65] Apparently Ms. C only recently became aware of the excesses for which she alone was responsible, probably during the marriage as well.

Fortunately, her expenses fell from $15,460 in August 2011 to $5,800 in March 2013. Much lower, but too late! [66] And while Ms. C continued to rack up expenses, which were unjustified in the vast majority of cases, Mr. B had to also pay the interest and a little principal on the numerous credit cards to the couple before the separation, for a total of $34,000 paid from May 2011 to March 2013. And there is still $130,000 in family debt to be partitioned. What a fiasco! [67] That is why, given the significant financial efforts made by Mr.

B, the court does not believe that he is required to pay that amount in addition to everything else. The possible arrears owed as of this date to Ms. C have been cancelled. [ 57 ] In so doing, the judge did not err in law. [ 58 ] In divorce matters, the waiving of arrears is within the court’s discretion. [9] In my opinion, the judge exercised his discretion judicially. [ 59 ] Consequently, this ground of appeal should be dismissed.

Sixth ground: Dismissal of deed of transfer (Exhibit P-8) [ 60 ] Admittedly the provisions on family patrimony are public order provisions and may not be renounced save in accordance with the terms provided by law (article 423 C.C.Q. ). [ 61 ] In view of the circumstances revealed by the evidence, the judge, by applying this provision as he did, did not commit any error that could give rise to Court’s intervention. [ 62 ] This ground of appeal must fail.

Seventh ground: Contributions during the marriage (article 418 C.C.Q.) [ 63 ] In accordance with paragraph 77 of his judgment, the judge analyzed the argument concerning the contributions in light of the fourth paragraph of

article 415 C.C.Q . [ 64 ] Relying on

article 415 C.C.Q. is clearly an error because the issue is not one of property devolved by legacy or gift but rather of contributions for improvements to property in the patrimony, which are governed by

article 418 C . C.Q , which reads as follows:

418. Une fois établie la valeur nette du patrimoine familial, on en déduit la valeur nette, au moment du mariage, du bien que l'un des époux possédait alors et qui fait

partie de ce patrimoine; on en déduit de même celle de l'apport, fait par l'un des époux pendant le mariage, pour l'acquisition ou l'amélioration d'un bien de ce patrimoine, lorsque cet apport a été fait à même les biens échus par succession ou donation, ou leur remploi.

On déduit également de cette valeur, dans le premier cas, la plus-value acquise, pendant le mariage, par le bien, dans la même proportion que celle qui existait, au moment du mariage, entre la valeur nette et la valeur brute du bien et, dans le second cas, la plus-value acquise, depuis l'apport, dans la même proportion que celle qui existait, au moment de l'apport, entre la valeur de l'apport et la valeur brute du bien. Le remploi, pendant le mariage, d'un bien du patrimoine familial possédé lors du mariage donne lieu aux mêmes déductions, compte tenu des adaptations nécessaires. 418.

Once the net value of the family patrimony has been established, a deduction is made from it of the net value, at the time of the marriage, of the property then owned by one of the spouses that is included in the family patrimony; similarly, a deduction is made from it of the net value of a contribution made by one of the spouses during the marriage for the acquisition or improvement of property included in the family patrimony, where the contribution was made out of property devolved by succession or gift, or its reinvestment.

A further deduction from the net value is made, in the first case, of the increase in value acquired by the property during the marriage, proportionately to the ratio existing at the time of the marriage between the net value and the gross value of the property, and, in the second case, of the increase in value acquired since the contribution, proportionately to the ratio existing at the time of the contribution between the value of the contribution and the gross value of the property.

Reinvestment during the marriage of property included in the family patrimony that was owned at the time of the marriage gives rise to the same deductions, adapted as required. [ 65 ] Despite this error, I find that the judge discussed the issues raised by the evidence regarding the contributions when he writes: [translation] [78] Except that, as the courts have repeatedly ruled, for this exception to apply, the creditor must clearly and irrefutably demonstrate that the specific monies from gifts or successions were used in the work or renovations for the building forming part of the patrimony. [79] Here, the only evidence adduced shows that the amounts received by Ms.

C were deposited in the parties’ joint account and that

they were used to buy various goods or absorb part of the large and numerous household debts. [80] The Court is not convinced that these legacies or gifts were “re-employed” for the specific purposes they wish to claim. There will therefore be no deduction for Ms.

C concerning these sums. [Citation omitted.] [ 66 ] In my opinion, the judge committed a palpable and overriding error in paragraph 79, cited above, because the evidence clearly shows much more. [ 67 ] First, the oral evidence contains the respondent’s acknowledgement that these amounts were likely invested in improvements to the family residence, as the appellant maintains, even though they transited through the parties’ joint bank account. Excerpt from the respondent’s testimony when he was questioned about the inheritance of $30,000 received by the appellant from her mother in 2004 [translation] A. Ah!

There probably was work done on the house and a portion of the work was actually paid for with that money. Q. The fact is that in that case we are talking about work on the house, the bathroom, main floor and master bedroom during that period. Do you remember that there was work done? A. Yes, definitely. Quite definitely. Q. For around thirty thousand dollars ($30,000)? A. Quite possibly, yes. I don’t remember the figures but it is possible. Excerpt from the respondent’s testimony when questioned about the gift of $76,615 received by the appellant from her father in 2005 Q. O.K.

There was also seventy-six thousand dollars ($76,000), a gift from her father; seventy-six thousand six hundred and sixteen dollars ($76,616) on October twelfth (12th), two thousand and five (2005). Are you aware of that gift? A. Yes. Q. What was it used for? A. I don’t remember. Q. If I told you that there was work done in the house, X’s bedroom, the bathroom in the basement, the family room, does... (inaudible)? A. It’s quite possible that it was done at that time.

Yes, quite possible that it was done at that time. [Transcribed as is.] [ 68 ] But in addition, the documentary evidence contains the respondent’s express and unequivocal acknowledgement: Excerpt from the agreement signed on January 27, 2011, and dictated by the respondent (Exhibit P-8) [translation] I hereby further acknowledge that this portion is rightfully hers considering that very early in our life together, she stopped working outside the home so that she could take care of the children and be fully responsible for managing all domestic matters, as well as all the secretarial work and accounting for my office, and that she invested her entire personal inheritance in the family patrimony, its assets and its savings. [ 69 ] Then, when he questioned his client about the valuation of the family residence on various dates and without objection on the respondent’s part, counsel for the appellant referred to an expert report (Exhibit P-22) that proposed three values for the family residence ($185,000 in July 1996, at the date of marriage; $330,000 as at December 31, 2005; and $475,000 at the time of the divorce proceedings), based in particular on the work done on the home over the years and described in

Schedule E hereto.

[ 70 ] The appellant bore the burden of showing that all or part of the gift and inheritance, received in 2004 and 2005 respectively, had been used specifically for improvements to the property (the residence) and therefore constituted a contribution entitling her to a deduction under

article 418 C.C.Q. [ 71 ] On the sole ground that the amounts had been deposited in the parties’ joint bank account (like some of their other financial resources, but not all because of the significant portion of professional income not reported to the tax authorities from cash that was never deposited in the bank), the judge found that the appellant had not discharged her burden of proof. [ 72 ] In my opinion, given the factual background described above, this reason for dismissing the right to a deduction is without merit. [ 73 ] Depositing the sums received as a gift or inheritance in a joint bank account does not automatically result in the loss of the right to the deduction in

article 418 C.C.Q . [ 74 ] In this particular case, such transiting of sums in the joint bank account would not make the appellant lose her right to a deduction for contributions. The respondent recognizes that the appellant received a gift of $30,000 in 2004 and an inheritance of $76,615 in 2005. He admits that these amounts were invested in work on the family residence in 2004 and 2005, while the total cost of this work exceeded the sum of $106,615.

Lastly, the evidence shows that the family residence increased in value over the years, from $185,000 (in 1996) to $475,000 (in 2011). [ 75 ] Given these circumstances, I am of the view that it is appropriate to draw inspiration from what LeBel J.A., as he then was, did in Droit de la famille – 1893 , where he wrote: [translation] The home used by the two parties was part of the family patrimony. Its value must be included in full. The main problem in calculating and partitioning the family patrimony here, however, remains the issue of the appellant’s contribution of $44,000.00.

The respondent wanted to contest the very existence of this contribution, as well as its amount. The matter was settled through a judicial admission. The respondent admitted before the Superior Court that a contribution of $44 000.00 existed.

This admission is noted in the minutes of the hearing: [translation] “Admission: From the inheritance that the wife received during the marriage, she invested $44,000.00 in the family patrimony.” (A.F. at p. 51) In principle, the appellant is therefore entitled to the recognition of this contribution in establishing the family patrimony. … The respondent’s admission does not completely settle the problem of the value of the contribution, however. He contests, although not too strenuously, the value of the contributions made to improve the building. We will not return to this matter.

Despite the fact that there is no specific evidence of the increased value, evidence of the contribution and the amounts invested has been adduced. It is reasonable to assume that the work done on the family residence had to result in at least in an equivalent appreciation . [10] [Emphasis added.] [ 76 ] The appellant will therefore be entitled to a deduction for contributions in the amount of $106,615. [ 77 ] Based on the figures proposed by counsel for the parties during argument, the judge found that the partitionable value of the family residence was $282,093.

He therefore declared that the respondent’s share of the equity in the family residence owned solely by the appellant was $141,046.50, and he ordered the appellant to pay the entire sum within no more than 90 days, without interest. [ 78 ] At the hearing of this Court, counsel recognized that they had made an error in calculating the source of the figure used by the judge.

They jointly requested that we correct the error in all cases, the partitionable value before deduction of any contribution being $239,528.54 and not $282,093. [ 79 ] As I find that a deduction for contributions in the amount of $106,615 should be applied in favour of the appellant before the end of the fiscal year, the partitionable value will therefore ultimately amount to $132,913.54 and the appellant will therefore be required to pay $66,456.77 to the respondent.

Eighth ground: Unequal partition of family patrimony [ 80 ] Equal partition is the rule; unequal partition is the exception. [ 81 ] The court may, on an application, make an exception to the rule of partition into equal shares (article 422 C.C.Q. ) where it would result in an injustice considering, in particular, the brevity of the marriage, the waste of certain property by one of the spouses, or the bad faith of one of them . [ 82 ] There is no evidence of this in the record. [ 83 ] The appellant has not shown that the judge committed an error justifying the Court’s intervention in this respect.

Ninth ground: Compensatory allowance

[ 84 ] In paragraph 31 of his judgment, the judge found that the appellant had waived her claim for compensatory allowance. Having no such claim, the judge could not allow it. [ 85 ] A compensatory allowance is not to be used to rebalance the partition of the family patrimony (which is what the appellant would like). [ 86 ] In any case, the evidence adduced in the record did not permit an allowance in accordance with applicable criteria. Tenth ground: Partition of debts [ 87 ] First, the fate of an RRSP loan ($29,876.95) and of the resulting RRSP ($30,000) must be settled.

The appellant and the respondent note that the judge did not discuss it, but they agree to a 50/50 partition (both the loan and the asset) and undertake to act accordingly, in particular to sign any documents required for this purpose forthwith. [ 88 ] Second, the appellant objects to the judge having ordered that she assume 50% of the existing debts at the time of the marriage breakdown, which totalled around $130,000, [11] without having recognized and validated the undertaking signed by the respondent on January 27, 2011 (Exhibit P-8), to the effect that she owned 100% of the equity in the family residence. [ 89 ] She notes that she asked for the respondent alone to be required to assume all the debt in his name and of having offered to assume 50% of the debt only in the event that she owned 100% of the equity in the family residence, which the respondent willingly acknowledged (moreover, this is corroborated by a reading of the trial transcript). [ 90 ] Since the judge did not recognize that she owned 100% of the equity, and short of a Court intervention in this regard, the appellant seeks a declaration that the respondent alone shall bear all the debts in his name and that she will assume her own line of credit debt, and that she and the respondent shall carry, in equal shares, the balance on the joint BMO credit card as at the date of the marriage breakdown. [ 91 ] I am of the opinion that this application should be granted as valid between the appellant and the respondent only. [ 92 ] Thus, the respondent will alone assume the following liabilities, completely exonerating the appellant: his line of credit, the Amex credit card (balance of $29,466.72) and the Amex Holt credit card (balance of $11,140.77).

He will also assume 50% of the balance on the joint BMO credit card (balance of $14,965.47). [12] In

summary [THE COURT:] [ 93 ] ALLOWS in part the appeal for the sole purposes of: • replacing the conclusions contained in paragraphs 90 and 93, which read as follows : [ translation] [90] ORDERS Mr. B. to pay Ms. C. the amount of $2,500 a month for herself, an amount that is taxable for Ms. C. and deductible for Mr. B., up to and including September 1, on condition that Ms. C. may request an extension of such support if her health deteriorates; [93] In this regard, DECLARES that the value of Mr. B.’s share of the equity in the former family residence of the parties is worth the sum of $141,046.50 and ORDERS Ms.

C. to pay Mr. B. this amount within a maximum period of 90 days, without interest; with the following conclusions : [90] ORDERS Mr. B. to pay Ms. C. the amount of $2,500 a month for herself, an amount that is taxable for Ms. C. and deductible for Mr. B., up to and including September 1, but reserves Ms. C.’s right to return to court if the situation warrants it; [93] In this regard, DECLARES that the value of Mr. B.’s share of the equity in the former family residence of the parties is worth $66,456.77 and ORDERS Ms. C. to pay Mr.

B. this amount within a maximum period of 90 days, without interest; And • adding conclusions 95 A and 95 B below : [95 A] DECLARES that, as between Ms. C. and Mr. B. only, Ms. C. and Mr. B. will each assume 50% of the balance of the BMO credit card, Ms. C. will assume alone the balance of her line of credit and Mr.

B. will assume alone the balance of his line of credit and of his Amex and Amex Holt credit cards. [95 B] DECLARES that the RRSP loan ($29,876.95) and the resulting RRSP ($30,000) will be divided 50/50, TAKES NOTE of the parties’ undertaking to sign, as needed and without delay, any document required for this purpose, and ORDERS THEM to act accordingly.

MARIE ST-PIERRE, J.A.