2017 QCCA 2070, 2017 QCCA 2070

Droit de la famille — 173118 2017 QCCA 2070 COURT OF APPEAL CANADA PROVINCE OF QUEBEC REGISTRY OF MONTREAL No.: 500-09-026820-175 (505-12-038614-130) DATE: DECEMBER 13, 2017 CORAM : THE HONOURABLE JULIE DUTIL, J.A. MARIE ST-PIERRE, J.A. ROBERT M. MAINVILLE, J.A. M. K. Appellant – Defendant and cross-applicant v. C. H.

Respondent – Applicant and cross-defendant JUDGMENT [ 1 ] The appellant appeals from a judgment rendered May 5, 2017 by Justice Brian Riordan, of the Superior Court, District of Longueuil, which dismissed the respondent’s application to cancel child support and granted, in part, the appellant’s counterclaim for repayment of outstanding debts. [ 2 ] The application filed by the respondent sought: - The annulment of his support obligations retroactive to February 20, 2016; - Reimbursement of $3,309.62 for various taxes and sale costs he paid with respect to the family residence; and - The suspension of the $500 monthly payments for his outstanding debt on the family residence [ 3 ] The appellant’s response and counterclaim sought: - Reimbursement of $17,436 in mortgage payments; - $14,903 in compensation for the loss of the Mercedes Benz; - $5,803.08 for municipal and school taxes; and - Multiple adjustments with respect to child support giving rise to arrears totaling approximately $18,000 for the years 2014 (based on hidden pension income), 2015 and 2016 (based on the parties’ declared income); and - A new child support order of $1,549 per month. [ 4 ] The conclusions of the judgment on appeal read as follows: [23] DISMISSES the Husband’s motion to cancel child support; [24] GRANTS in part the Wife’s Counterclaim; [25] ORDERS the Husband to pay child support to the Wife in the amount of $1,000 a month retroactive to April 1, 2016; [26] ESTABLISHES that the arrears of child support owed by the Husband total $2,450, covering the period from April 2016 through May 2017 inclusively; [27] ORDERS the Husband to continue the monthly payments of $500 until the debt relating to the sale of the family residence is fully paid; [28] WITHOUT COSTS . [ 5 ] In his notice of appeal and memorandum, appellant’s counsel raised four issues, but at the hearing he conceded that addressing

the following three issues would be sufficient to resolve the appeal: • First issue : « Le juge de première instance devait-il condamner l’intimé au remboursement des montants payés par l’appelante sur le prêt hypothécaire, vu le défaut de l’intimé de respecter son obligation à cet effet prévue à la Convention? » • Second issue : « Le juge de première instance devait-il condamner l’intimé au paiement d’un montant correspondant à la perte de valeur de la Mercedes lors de la reprise, vu le défaut de l’intimé de respecter la Convention et de faire que la propriété de cette automobile revienne à l’appelante? » • Third issue : « Le juge de première instance devait-il tenir compte de l’entente des parties se trouvant à la Convention selon laquelle l’enfant fréquente le Pensionnat A, qui inclut la scolarité et l’hébergement (dormitory) aux fins d’établir l’obligation alimentaire de l’intimé?

Si tel est le cas, l’erreur consistant à ne pas tenir compte des frais de pensionnat est-elle susceptible d’impliquer la modification en appel du montant de la pension alimentaire établi en première instance? » [ 6 ] Given that the judgment under appeal is silent with respect to the first two counter-claims of the appellant (first and second issues) and contains both errors in principle and palpable and overriding errors (namely relevant to the third issue), intervention is required.

Such intervention cannot occur without a proper accounting of the amounts paid by the respondent to the appellant over the years, based on the available evidence – even if imperfect or incomplete – so that the Court may assess the net amounts still owed by the respondent to the appellant in relation to the first and second issues and the outstanding arrears in relation to the third issue. Context [ 7 ] The parties were married in Taiwan in 1997. One child was born of their union in 1999.

In 2009, the family moved permanently to Canada (Quebec) where all its members have since lived. [ 8 ] On October 31, 2013, the parties filed a divorce agreement in Chiayi, Taiwan (“ the Taiwanese agreement ”). The agreement granted custody to the appellant and provided that the respondent would pay monthly child support of 48,000 New Taiwanese Dollars (“ NT$ ”) upon homologation of the divorce and until the child reached age 26. This agreement makes no mention of the respondent’s income.

In 2013, NT$48,000 was equivalent to approximately CA$1,700. [ 9 ] Having received legal advice to the effect that the Taiwanese agreement would not be valid in Canada, the parties negotiated and signed a second agreement, in Canada, on November 28, 2013 (“ the Canadian agreement ”), which was ratified in a judgment of the Quebec Superior Court pronouncing their divorce rendered on January 6, 2014. [ 10 ] The relevant sections of the Canadian agreement read as follows: SEEING there was one child born of the marriage of the parties, being […], born on […], 1999, in Taiwan; SEEING the parties have been living separately since October 15, 2012 and that they declare that there is no possibility for reconciliation between them; SEEING that the family residence is situated at […] City A , Québec , and that, since the separation, the husband continues to reside therein; SEEING that the wife presently resides at […] , North York, Ontario […]; SEEING that the wife is presently following language courses and that she is unemployed, she has no income and she uses savings to pay for her daily expenses ; SEEING the husband works as a customer service provider in internet technology, for […], and that his income from this employment is of the order of $36,000.00 per year; SEEING the child born of the marriage of the parties, […], presently of the age of 13 years, attends Secondary 2 in a private school at Pensionnat A in City B, where the tuition, music lessons, dormitory and other fees are of the order of $9,300.00 per year ; SEEING the cottage which served as the family residence was purchased on October 1, 2010 in the sole name of the husband , that the purchase price was in the amount of $350,000, for which the down-payment, in the amount of $122,000, was paid by the wife and that the balance of the mortgage loan is presently in the amount of $219,664; […] SEEING the husband has the possession and use of a Toyota Corolla 2009 automobile, registered in the name of the wife , and that the wife presently has the possession and use of a Mercedes Benz 2010 automobile, registered in the name of the husband ; […] 2.

The husband shall continue to have the use and possession of the previous family residence , located at […] and he shall continue to do

so until December 15, 2013 , at which time he shall depart therefrom and provide possession thereof to the wife, for her use and that of the minor child, who shall have the right of use until the time when same is sold and vacant possession is to be given to the eventual purchaser, whether this be so before or after the date of the eventual judgment of divorce; […] 4.

The parties further agree that, from the eventual net amount of the proceeds of sale of the family residence, the husband shall pay to the wife the sum of $170,000 ; in the event such net amount of the proceeds of sale is inferior to the sum of $170,000, the husband binds and obliges himself to pay to the wife the difference so as to ensure that the wife will receive the total sum of $170,000; […] 5. The husband shall continue to pay the monthly mortgage installments until the date of the eventual sale of the family residence ; […] 8.

The husband shall pay to the wife child support in the amount of $1000.00 per month , payable in advance on the first day of each month; this child support shall be payable starting on the date of the judgment to be eventually rendered herein ; 9.

In the event the family residence has not been sold by the date of the eventual judgment of divorce , in that case the husband shall continue to pay the monthly installments of the mortgage and the payment of child support shall be suspended until the date of sale of the family residence; following the date of said sale, the child support will commence and will be in the amount of $1000.00 per month; 10.

Until such time as when child support becomes payable to the wife, the husband shall himself continue to pay the expenses of the child in the same manner that has existed prior to the date of the signature of the present agreement; […] 12. Seeing the Toyota Corolla automobile presently in the possession of the husband is fully paid and is registered in the name of the wife, the latter binds and obliges herself to do what is necessary to transfer the ownership of this automobile to the name of the husband; within thirty (30) days from the date of the judgment to be rendered herein; 13.

Applicant shall continue to have the right of uninterrupted use and possession of the Mercedes Benz 2010 automobile, presently in her possession; 14.

Seeing the Mercedes Benz automobile is registered in the name of the husband, and seeing there presently exists a balance in the approximate amount of $18,000.00 due and owing on its purchase price , for which approximately three years and four months of installments still remain to be made, at the rate of $456.00 per month, the husband undertakes to continue to pay these installments until full payment, following which the husband binds and obliges himself to do what is necessary to transfer the ownership of this automobile to the name of the wife, within thirty (30) days from the date of the last said installment payment ; […] 26.

T he present agreement represents the totality of the agreement made by the parties and there is no additional agreement or representation made by the parties, other than what is specifically declared herein; [Emphasis added] [ 11 ] When the Superior Court pronounced the divorce judgment and ratified the Canadian agreement on the basis of the income then declared, it was not made aware of the Taiwanese agreement. [ 12 ] The respondent’s annual income mentioned in the

preamble to the Canadian agreement (roughly CA$36,000) did not include an annual pension of approximately CA$27,000 that the respondent was receiving from the Taiwanese government and is still entitled to. [ 13 ] Between January 2014 and March 31, 2016, while the respondent paid various amounts to the appellant, he obviously failed or neglected to satisfy specific obligations contracted under the Canadian agreement.

Those failures need to be acknowledged before calculating what, if anything, one still owes to the other after proper compensation. [ 14 ] According to the table of payments submitted in evidence by the appellant, the amounts paid by the respondent to the appellant between January 1, 2014 and March 31, 2016, in New Taiwanese dollars converted to Canadian dollars, [1] totalled CA$41,203. [ 15 ] Over the years, in light of the evidence introduced into the court record, the special expenses relating to the schooling of the parties’ daughter were: • 2012-2013 School Year: CA$12,946.40 • 2013-2014 School Year: CA$13,195.54 • 2014-2015 School Year: CA$9,013.46 (excludes school lunch) • 2015-2016 School Year: CA$11,194.15 • 2016-2017 School Year: no evidence filed • 2017-2018 School Year: CA$10,877.60 (projected expenses assuming the child has a roommate and takes a full meal plan) [ 16 ] In 2016, alleging that he had lost his job, the respondent filed an application to cancel his child support obligations.

As

mentioned earlier, the appellant filed a counterclaim alleging that the respondent owed her sums for mortgage payments she made on his behalf, for a car he failed to transfer to her name and for child support arrears. [ 17 ] The hearing took place before Justice Riordan on May 4 and 5, 2017 with the participation of a Mandarin-English interpreter, both parties being self-represented. The Court acknowledges that management of the trial was not an easy task and that the transcript shows significant efforts by the judge to obtain relevant information given those circumstances.

Analysis First issue: the mortgage [ 18 ] The Canadian agreement stipulates that the appellant and her daughter are to reside in the family residence from December 15, 2013 until its sale. Meanwhile, the respondent had a duty to pay the monthly mortgage instalments (sections 2 and 5). [ 19 ] The family residence was sold on November 13, 2015. Until that date, as per sections 5 and 9 of the Canadian agreement, the respondent was required to pay the mortgage (in the amount of $1,025.00 per month), but failed to do so sixteen times.

The appellant had to assume those payments amounting to $16,400. [ 20 ] The judge should have acknowledged the respondent’s liability towards the appellant with respect to this sum. His failure to do so constitutes a reviewable error. Second issue: the Mercedes Benz [ 21 ] On April 30, 2012, the parties bought from Mercedes Benz, at the price of $30,577.60 a used 2010 Mercedes. They made a down payment of $4,500 cash and the balance of the sale was financed by the Mercedes Benz Corporation (monthly instalments of $456.89). The car was registered under the respondent’s name, but used by the appellant.

At delivery, the odometer indicated 10,427 km. [ 22 ] According to sections 12 to 14 of the Canadian agreement, the respondent had to make three years of monthly payments before transferring ownership of the vehicle to the appellant. [ 23 ] While he continued to make those payments between December 2013 and April 2014, he failed to make the May 2014 instalment and signed a voluntary surrender agreement, without penalty, on June 10, 2014. [ 24 ] The appellant was opposed to this voluntary surrender, but could not prevent it. [ 25 ] Even if imperfect, the evidence relating to the actual value of the Mercedes Benz as of June 10, 2014 is sufficient to allow a reasonable arbitration of the loss sustained.

Given the repossession without penalty by the dealer, the balance owed in June 2014 (in the amount of $16,403.84, representing approximately 50% depreciation from the sale price) constitutes a significant and sufficient indicia of its value in the circumstances. [ 26 ] The evidence shows that the other family vehicle (the Toyota) was sold for $6,800 and that the appellant kept the proceeds of that sale. Given

section 14 of the Canadian agreement, the respondent shall compensate the appellant for the difference. [ 27 ] Subtracting from the Mercedes’ value ($16,403.84) the amount of $6,800 that the appellant received from the sale of the Toyota, her net loss to be compensated is $9,603.84. The trial judge’s failure to acknowledge this liability constitutes a reviewable error. Third issue: child support [ 28 ] It is trite law that courts of appeal owe great deference to the decisions of trial judges respecting child support and that intervention will only be justified where the appellant demonstrates either (

i) that the variation order reveals an error in principle or a significant misapprehension of the evidence or (ii) demonstrates that the award is clearly wrong. [2] [ 29 ] Very recently, in November 2017, the Court wrote in Droit de la Famille — 172773 : [3] [13] L’

article 594 C.c.Q. prévoit la possibilité de réviser les jugements qui accordent des aliments : Art. 594. Le jugement qui accorde des aliments, que ceux-ci soient ou non indexés ou rajustés, est sujet à révision chaque fois que les circonstances le justifient. (…) Art. 594.

The judgment awarding support, whether or not the support is indexed or recalculated, may be reviewed by the court whenever warranted by circumstances. (…) [14] La Cour rappelait récemment que « le droit des enfants aux aliments est un droit personnel et fondamental », qu’il découle d’une obligation d’ordre public et que « la pension alimentaire pour enfant est toujours révisable et soumise à l’appréciation du tribunal ». [15] L’auteur Michel Tétrault souligne qu’« [u]ne ordonnance alimentaire à l'égard d'un enfant est toujours révisable […] si un changement significatif survient dans la situation des parties impliquées, à savoir l'enfant ou l'un ou l'autre des parents. […] Toutefois, il ne s'agit pas d'un appel, d'où la nécessité de la preuve d'un changement ».

Il précise que ce critère s’applique avec davantage de souplesse en matière de pension alimentaire pour enfants :

Le législateur et la jurisprudence reconnaissent la possibilité de réviser la pension alimentaire pour enfants s'il survient un changement significatif selon l'

article 594 C.c.Q. , qui permet la réévaluation des aliments attribués au créancier par jugement pour une ordonnance rendue en vertu du Code civil, ou selon l'article 17(4) L.d. pour une ordonnance rendue en vertu de la

Loi sur le divorce . Nous avons traité de la question du changement significatif à la

section 9.4 du présent volume. Il est toutefois pertinent de replacer ce concept dans le cadre d'une pension alimentaire à l'égard d'un enfant.

Force est d'admettre que le caractère d'ordre public de l'obligation alimentaire à l'égard de l'enfant et les principes énoncés dans la quadrilogie de la Cour suprême rendent les tribunaux moins exigeants quant au fardeau à assumer pour démontrer un changement ; l'intérêt de l'enfant étant un élément important dans l'évaluation de ce qui constitue un changement significatif. […] [16] Ce critère s’applique en matière de modification d’ordonnance alimentaire, que la pension alimentaire dont on demande la révision ait été établie par jugement ou par entente homologuée. [Emphasis in the original judgment; references omitted] [ 30 ]

Article 596.1 of the Civil Code reads as follows: 596.1. In order to update the amount of support payable to their child, parents must , on the request of one of them and no more than once a year, or as required by the court, keep each other mutually informed of the state of their respective incomes and provide, to that end, the documents determined by the rules for the determination of child support payments adopted under the Code of Civil Procedure (chapter C-25.01 ).

Failure by one parent to fulfill that obligation confers on the other parent the right to demand, in addition to the specific performance of the obligation and payment of the legal costs, damages in reparation for the injury suffered, including the professional fees of an advocate and any disbursements incurred. [Emphasis added] 596.1.

Afin de maintenir à jour la valeur des aliments dus à leur enfant, les parents doivent , à la demande de l’un d’eux et au plus une fois l’an, ou selon les modalités fixées par le tribunal, se tenir mutuellement informés de l’état de leurs revenus respectifs et fournir, à cette fin, les documents prescrits par les règles de fixation des pensions alimentaires pour enfants édictées en application du Code de procédure civile (chapitre C-25.01 ).

L’inexécution de cette obligation par l’un des parents confère à l’autre le droit de demander, outre l’exécution en nature et les frais de justice, des dommages-intérêts en réparation du préjudice qu’il a subi, notamment pour compenser les honoraires professionnels de son avocat et les débours qu’il a engagés. [Soulignements ajoutés] [ 31 ] This

article came into force in 2012, before the parties signed the Canadian agreement. This

article applies even though they signed an agreement. [ 32 ] Faced with the evidence that the respondent’s revenues in 2013 were substantially higher than those mentioned in the Canadian agreement, a situation that persisted through the following years, and that the appellant’s income had also varied (from $0 to $18,225 a year), the judge should have reviewed child support as of at least April 2016. [ 33 ] The evidence on record showing private school and boarding expenses as a shared priority of the parties prior to the breakdown of their marriage and notwithstanding their financial situation, the judge should have taken those expenses into account. [ 34 ] Calculated using the 2016 basic parental contribution, [4] on the basis of the income retained by the judge ($70,000 for the respondent and $18,225 for the appellant), and including special expenses in the net amount of $9,062.50 per year, the monthly child support to be paid, as of April 1, 2016, is $1,315.30. [5] Accounting (first and second issues – November 2013 to April 1, 2016) [ 35 ] Given

section 26 of the Canadian agreement, the appellant can neither claim rights provided for in the Taiwanese agreement nor demand that it be enforced. The Taiwanese agreement was signed in October 2013, before the Canadian agreement which, therefore, supersedes it. As of November 2013, the only enforceable agreement between the parties is the Canadian agreement which would be homologated in the divorce judgment rendered in 2014. [ 36 ] The respondent’s proposition that he had no financial obligation, other than the mortgage payments, towards his daughter from November 2013 to November 2015 is dismissed for the following three reasons: (1) it is not what the Canadian agreement stipulates at

section 10; (2) child support is an obligation of public order; (3) taking into account his actual income in 2013, instead of the amount of $36,000 he declared in the divorce proceedings, one has to acknowledge that he had the means to pay, over and above the monthly mortgage instalments, the child’s expenses as stipulated in

section 10 of the agreement. [ 37 ] The child’s expenses for the 2013–2014, 2014–2015 and 2015–2016 school years amount to $33,403. [6] During that period, as mentioned in paragraph [14] of the present judgment, the respondent paid the appellant $41,203, leaving a surplus of $7,800 to be deducted from the amount calculated for mortgage instalments.

[ 38 ] Therefore the respondent still owes the appellant $18,204 ([$16,400+$9,604] -$7,800). To that figure, an additional $250 will be added since, even though the parties came to an agreement concerning their respective claims for various taxes and sale costs (the claims of $3,309 and $5,803.08 mentioned above – the respondent having to pay $250 to the appellant), the judgment contained no such conclusion.

Third issue – child support arrears April 1, 2016 to date [ 39 ] As of April 1, 2016, the respondent should have paid child support of $1,315.30 per month, to be indexed as of January 1, , 2017. [ 40 ] A proper calculation of the arrears will have to be done taking into account indexation and the actual amounts of support paid by the respondent.

FOR THESE REASONS, THE COURT: [ 41 ] ALLOWS the appeal in part; [ 42 ] QUASHES in part the judgment rendered in first instance by: • REPLACING the conclusions contained in paragraphs 25 and 26 of the judgment of first instance with the following: [25] ORDERS the Husband to pay child support to the Wife in the amount of $1,315.30 a month retroactive to April 1, 2016, with annual indexation according to law as of January 2017; [26] DECLARES that the arrears of child support owed by the Husband shall be calculated in accordance with the present judgment; • ADDING the following conclusion to the judgment of first instance: [27.1] CONDEMNS the Husband to pay to the Wife $18,454 with legal interest and the additional indemnity set out at

article 1619 C.C.Q. from August 31, 2016; [ 43 ] Without costs. JULIE DUTIL, J.A. MARIE ST-PIERRE, J.A. ROBERT M. MAINVILLE, J.A. Mtre Christian Dufourd DUFOURD DION, avocats Inc. For the appellant C. H. On his own behalf Date of hearing: December 7, 2017