Lamoureux v. Hedquist, 2024 BCSC 32

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Lamoureux v. Hedquist, 2024 BCSC 32 Date: 20240109 Docket: E 136834 Registry: Kelowna Between: Leanne Lorraine Lamoureux Claimant And Thomas Donald Hedquist and 0867873 B.C. Ltd. Respondents And Robyn Gibson Respondent by Counterclaim Before: The Honourable Justice G.P. Weatherill Supplementary Reasons for Judgment Counsel for the Claimant: D.L. Polley Counsel for the Respondents: L.M. Bosdet M. Wardman Place and Date of Trial/Hearing: Kelowna, B.C. November 23 and, 24, 2023 Place and Date of Judgment: Kelowna, B.C.

January 9, 2024 Introduction [ 1 ] Following a hotly contested 12-day family law trial, I issued reasons for judgment on September 1, 2023 (indexed at 2023 BCSC 1539 ), with liberty to the parties to make further submissions should they be unable to agree on how various orders I made should be implemented or should they need clarification (“Reasons”). [ 2 ] They now return seeking various orders, guidance and clarification of the Reasons as follows (I will use the same abbreviations for properties and companies as I used in the Reasons):

a) The respondent applies to reopen the trial to adduce new evidence of the actual sale proceeds from the recently sold Apartment Block, which sale completed approximately two weeks after the Reasons were issued. He asserts that the actual sale price should be used instead of the higher appraised value that the parties relied on at trial;

b) A recalculation of the net sale proceeds of the Oasis Condo;

c) A recalculation of the claimant’s interest in the shares of the respondent’s three companies, 086 Ltd., Trademark and Superior Septic (“Companies”);

d) The allocation between the parties of the costs of obtaining various joint appraisal reports and joint expert reports;

e) A reconsideration of the claimant’s income for support purposes;

f) A reconsideration of the respondent’s income for support purposes;

g) The timing of the claimant’s purchase of the respondent’s interest in the Apex Chalet;

h) The property/assets to be included in the equalization payments; and

i) Costs. [ 3 ] I shall deal with each in turn. Re-opening the trial respecting the Prince George Apartment Block [ 4 ] In my Reasons, I concluded that each party was entitled to one-half of the equity in the Apartment Block. [ 5 ] For the purposes of calculating its equity, the respondent seeks to reopen the trial to adduce new evidence.

He argues that the post-Reasons sale price of $1.15 million represents its fair market value, rather than the $1.5 million fair market value set out in a joint appraisal dated January 23, 2022, and agreed on by both parties at trial (“Joint Appraisal”). [ 6 ] In March 2018, the Apartment Block was purchased by 086 Ltd. for $895,000 using 100% borrowed funds. I concluded that the parties intended to own it equally and that 086 Ltd. purchased it out of convenience because a new corporation would delay funding.

At para. 239 of the Reasons, I stated that: [239] The equity in the Apartment Block, net of taxes as discussed below, is to be divided equally between the parties and deducted from 086 Ltd.’s share valuation prior to determining the 75-25 share valuation in the respondent’s favour. [ 7 ] On March 24, 2023, shortly before the commencement of the trial, the respondent (as 086 Ltd.’s sole shareholder), unilaterally listed the Apartment Block for sale without consultation with or agreement from the claimant.

He did so notwithstanding a restraining order made early on in the litigation preventing either party from disposing of family property. The original listing price was $1.69 million, and he used his new common law partner, Ms. Radcliffe, as the listing realtor. He received three early offers, two for $1.5 million and one for $1.6 million. He accepted the offer at $1.6 million. [ 8 ] During the trial, the parties advised that there was a pending contract of sale for $1.6 million with a planned June 2023 completion date.

The claimant, although not involved with the sale in any way, gave the sale her blessings at that price. Unfortunately, that sale collapsed in mid-June 2023 and the respondent then re-listed it at steadily diminishing listing prices, from $1.59 million to $1.49 million to $1.35 million, all without consultation with or agreement from the claimant. [ 9 ] During submissions in mid-June, 2023, and as I stated in the Reasons at para. 238: [238] The respondent seeks leave to reopen his case with further evidence on the sale of the Apartment Block if a firm contract of sale is reached relatively soon.

If not, he is content to accept the current appraised value of $1.5 million as its fair market value. [ 10 ] The Reasons were delivered on September 1, 2023. On September 14, 2023, some two weeks after the Reasons were delivered, the respondent accepted an offer of $1.15 million on the Apartment Block, again without any consultation, notice to or consent from the claimant.

The sale closed at that price on October 30, 2023. [ 11 ] The respondent asserts that, because of the hefty increase in interest rates and the consequent significant drop in the Prince George real estate market, the Joint Appraisal is now dated and does not reflect the Apartment Block’s true value. He submits that the best evidence of the Apartment Block’s value is its sale price. He points out that it was exposed to the market for seven months and though several other higher offers were received, they all fell through. [ 12 ] He says the accepted $1.15 million offer represents the best non-subject binding offer.

He points to the following issues raised by other interested purchasers as reasons why the $1.15 million sale price reflected fair market value: (1) three of the thirteen suites in the Apartment Block are non-conforming illegal suites; (2) aluminum wiring within the Apartment Block may require future replacement; and (3) possible consequent increased insurance costs. [ 13 ] He says it is the actual “equity” as it is now known that should be used to determine each of the parties’ 50% interest, not its theoretical equity based on a dated appraisal.

In addition, he says the equity should be recalculated using the actual mortgage balance, distributive taxes and actual real estate commissions that are also now known. [ 14 ] The claimant opposes any new valuation of the Apartment Block. She argues that the respondent unilaterally sold it at an improvident fire-sale price, without proper marketing and without any input or agreement from her. She argues that the material relied on by the respondent as to why the sale price of $1.15 million represents fair market value is based on inadmissible hearsay and should not be considered.

She argues that despite what the respondent sold it for (which she says was at an unrealistically low price), for the purposes of dividing family property, the Apartment Block must be valued in accordance with the Joint Appraisal as agreed by the parties at trial. Re-opening a trial – The law [ 15 ] The test for reception of new evidence following the completion of trial and the delivery of judgment is not controversial.

The party seeking to re-open the trial and adduce new evidence must show that a miscarriage of justice would likely occur without the rehearing and the new evidence would likely change the result of the trial. The principles involved can be summarized as follows:

a) it is in the interests of justice to consider that a trial is complete when each side has closed their case, and the judge has delivered his or her judgment;

b) a judge’s unfettered discretion to reopen a trial should be exercised sparingly and with restraint;

c) a party may not use the rule to re-argue, re-cast, or re-state his or her case, rather the rule is available to remedy what might otherwise be a substantial injustice;

d) it is not intended that a party should be able to lead substantial new evidence, nor does the rule generally permit the leading of new expert evidence;

e) the reasons that the evidence was not led or submissions not made in the first place may be relevant to the exercise of the judge’s discretion, particularly where the failure to do so in the first place was a considered or pragmatic decision;

f) the discretion should only be exercised if the reception of the new evidence would probably change the result of the trial; and

g) the onus is on the applicant to show that a miscarriage of justice would probably occur if the trial is not reopened, ( Moradkhan v. Mofidi, 2013 BCCA 132 at para 31 ; G.C.H. v. H.E.H. , 2009 BCSC 4 at para. 20 ). [ 16 ] The overarching consideration is whether it is in the interests of justice that the case be re-opened: Moradkhan at para. 31 ; J.E.H. v. P.L.H ., 2014 BCSC 125 . [ 17 ] Reasons why the court should be cautious in exercising its discretion to re-open a trial after judgment include preventing abuse of the court’s process and ensuring finality of proceedings: Mohajeriko v.

Gandomi , 2010 BCSC 60 at paras. 23 – 32 . The merits [ 18 ] The respondent says that unless the actual sale price of the Apartment Block is used, significant unfairness will result. He argues that the Apartment Block was exposed to the market from March 2023 through mid-September 2023, and despite higher offers that fell through, the accepted offer of $1.15 million reflects fair market value and it would be manifestly unfair to him to have it valued at $1.5 million.

He maintains that the Joint Appraisal did not include a consideration of the Apartment Block’s wiring issue that was subsequently discovered, nor did it comment on whether the three illegal suites would affect its value. Further, he submits that the Joint Appraisal was done during a markedly different economic environment. [ 19 ] For the following reasons, I am not persuaded that the trial should be re-opened to admit this new evidence. [ 20 ] First, the scheme of the Family Law Act , S.B.C. 2011, c. 25 [ FLA ] is to determine the value of family property at a particular point in time.

In this case, it is the date of trial and not months afterward.

Section 87 of the FLA is mandatory and reads as follows: 87. Unless an agreement or order provides otherwise and except in relation to a division of family property under

Part 6, (

a) the value of family property must be based on its fair market value, and (

b) the value of family property and family debt must be determined as of the date (

i) an agreement dividing the family property and family debt is made, or (ii) of the hearing before the court respecting the division of property and family debt. [ 21 ] Second, both parties agreed in the May 12, 2021 consent order that they would not dispose of any family property pending final determination of this case without the written consent of the other party or court order.

Instead, the respondent unilaterally listed the Apartment Block for sale in March 2023 for $1.69 million without consulting the claimant, without obtaining her consent and without the claimant having any ability to control the process. Further, after receiving various offers, he accepted an offer of $1.6 million, again without consulting the claimant. Nevertheless, the claimant was prepared to agree to the sale at that price. When that offer fell through mid-trial and again without any consultation with the claimant, the respondent re-listed the Apartment Block at a lower price.

Despite this, the parties made it clear at trial that they were content to value the Apartment Block at $1.5 million. [ 22 ] Third, after the Reasons were delivered and again without any consultation with the claimant, the respondent unconditionally accepted the $1.15 million offer from the same buyer who had offered to purchase it for $1.4 million in July 2023. At the time of that acceptance, he would have known that the claimant was awarded 50% of the equity in the Apartment Block and that he was restrained from selling it without the claimant’s consent or court approval.

He neither sought nor obtained either. [ 23 ] Fourth, there is no current appraisal and no admissible evidence explaining why the Apartment Block should have been sold at a price well below the value the parties had earlier agreed to. The offer was accepted unconditionally with no consideration for the claimant’s interests and without making the sale conditional on court approval.

Had the respondent sought court approval as he should have, he would have been required to show that the sale was a provident one, which would have included satisfying the Court that both the marketing and sales process were fair and proper for all concerned and that the proposed price reflected the Apartment Block’s fair market value: Kokanee Mortgage MIC Ltd. v. 669655 B.C. Ltd. , 2014 BCSC 458 at paras. 24 – 27 . He did not do so. [ 24 ] Fifth, the admissible evidence before me on the application is wholly deficient respecting valuing the Apartment Block at less than the Joint Appraisal.

Also, wholly deficient is evidence respecting the nature and extent of the marketing efforts made by Ms. Radcliffe. The respondent relies on hearsay evidence and evidence in the nature of expert opinion, both of which are not admissible and cannot be taken into consideration.

[ 25 ] I conclude that none of what the respondent relies on is evidence of a reduction in fair market value from the $1.5 million Joint Appraisal. Other than evidence that the respondent simply decided to sell the Apartment Block for $1.15 million, there is no admissible evidence on why its fair market value should be reduced. Additionally, there is no evidence of any reasonable marketing efforts made by Ms. Radcliffe.

On the contrary, the evidence suggests that the respondent may have been prepared to significantly discount the sale of the Apartment Block to secure a speedy sale. [ 26 ] The respondent has not proven that a miscarriage of justice would occur if he was not permitted to re-open the trial. Given the manner in which he chose to dispose of the Apartment Block, I consider that it would be unjust to allow him to re-open the trial. I am not persuaded that the $1.15 million sale price is reflective of the Apartment Block’s fair market value.

The sale of an asset at any price, without more, is not evidence of its fair market value. [ 27 ] Accordingly, the respondent’s application to re-open the trial must be dismissed. To allow him to re-open the trial would be contrary to the weight of the authorities to which I have been referred and would set a dangerous family law precedent. [ 28 ] This means that the parties are left with the Joint Appraisal as the best evidence of the Apartment Block’s fair market value, and it is that value that will be used to determine the equity in it.

The respondent must account to the claimant for the difference between the appraised value of $1.5 million and the sale price of $1.15 million. As set out in the Reasons, the claimant’s equity will be net of distributive taxes based on the actual sale price, actual real estate commissions paid and actual adjustments and closing costs. Calculation of equity [ 29 ] Based on my understanding of the numbers, I calculate the equity in the Apartment Block as follows:

a) Fair market value: $1,500,000

b) Actual mortgage payout to First National: ($690,752.11)

c) Net adjustments and closing costs: ($1,686.93)

d) Actual real estate commissions: ($39,375)

e) Payment of security deposits: ($6,944.66)

f) Distributive taxes estimated on actual sale: ($175,000) Equity $586,241.30 [ 30 ] Each party is entitled to one-half of this equity, or $293,120.65 each and the respondent must account to the claimant for this amount. The Oasis Condo [ 31 ] In September 2020, 086 Ltd. entered into an option agreement to purchase the Oasis Condo, a high-end luxury condominium at #404-13415 Lakeshore Drive, Summerland, BC, then under construction, for $1,499,900. Trademark and 086 Ltd. made a series of deposits on the purchase.

The initial deposit was $163,890 (comprised of $13,890 Trademark borrowed from its bank and $150,000 borrowed from the respondent’s friend Mr. Brian Martin). A second deposit of $327,780 was paid by Trademark in two installments ($50,000 + $277,780), also using borrowed funds. The total deposits paid was $491,670 (“Deposits”). [ 32 ] On March 5, 2023, 086 Ltd. assigned the option to purchase the Oasis Condo for $582,770 comprising reimbursement of the Deposits plus a $91,100 profit. That is, the Oasis Condo was sold for $91,100 more than the Deposits.

The sale proceeds of $582,770 were held in trust pending the outcome of trial. [ 33 ] During trial, the respondent applied to have the Deposits returned. I ordered that $150,000 be paid to retire the loan from Mr. Martin and that a further $200,000 be paid to Trademark with the balance of approximately $233,000 to be held in trust pending further order.

The purpose of my order was to ensure the $150,000 loan was repaid and that operating funds could be made available to Trademark because of financial distress it was experiencing at the time. [ 34 ] In the Reasons, I concluded that the claimant was entitled to a 50% share of Oasis Condo’s net equity. At para. 244, I stated in part: [244] …Subject to distributive taxes, the claimant is entitled to a one-half interest in the net sale proceeds, net of the Oasis Property Loan and Trademark Installments.

In other words, she is entitled to one-half of the net profits from the sale of the Oasis Property. [ 35 ] The first issue that has arisen is whether the Deposits, or a portion of them, were captured by Mr. Sanders’ valuation of 086 Ltd. and if so, how that affects the calculation of both the Oasis Condo’s net equity and the claimant’s 25% share entitlement. That is, the Deposits should not be considered twice. [ 36 ] The claimant does not dispute the amount of the Deposits, nor that the profit on the assignment of the Oasis Condo was $91,100.

She also does not dispute that the Deposits need to be deducted before determining the equity to be divided. She maintains, however, that in his June 2022 report, Mr. Sanders valued the Companies’ shares as of May 2022 on a net asset approach based on the 2020-year-end financial statements and internal financial statements to December 2021. His report showed a deposit paid by 086 Ltd. for the Oasis Condo of $184,000 and was listed as an asset. She asserts that $184,000 is the only amount that should be considered in determining the Companies’ valuations and not the Deposits in total. [ 37 ] Mr.

Sanders’ report was prepared before Trademark provided the second installments comprising the Deposits. He listed the deposits he was aware of ($184,000) as an asset. The respondent says this valuation is based on the total deposits of $341,670, less the

loan from Mr. Martin of $150,000 ($341,670 - $150,000 = $191,670). He suggests the small difference is probably related to taxes or perhaps interest paid to Mr. Martin. At the time of Mr. Sanders’ report, there was in fact a total of $213,890 in deposits paid ($13,890 + $50,000 + $150,000 = $213,890). It is unclear what the difference is between the actual deposits of $213,890 and Mr. Sanders’ $184,000 amount. Of note, in determining the Companies’ values, Mr. Sanders listed the $150,000 Brian Martin loan as a liability. [ 38 ] The claimant argues that because Mr.

Sanders’ share valuation included only $184,000 of the Deposits, the additional deposits of $277,780 ($491,670 - $213,890) ought to be split between the parties on a 25%-75% basis. [ 39 ] I do not agree. The evidence at trial was that 100% of the Deposits were borrowed funds. The fact that Mr. Sanders only considered $184,000 in his report is a red herring. Considered globally, the Deposits would be accounted for in the Companies’ books as debt on one side of the ledger, and as an asset on the other side of the ledger.

The net effect of the Deposits on the Companies’ valuations is therefore zero. [ 40 ] I shall deal with this further when I deal with the calculation of the claimants’ 25% interest in the increased value of the Companies’ shares. [ 41 ] The second issue is whether commissions paid to Ms. Radcliffe are to be deducted from the $91,100 profits before calculating the parties’ 50% equity.

The claimant maintains they should not be deducted because I did not mention them in the Reasons and because the commissions would be going, indirectly, to the respondent’s household. [ 42 ] The respondent says that those net profits, after real estate commissions of $63,577.50 and distributive taxes of $24,000, leaves a balance of $3,522.50 to be divided equally. [ 43 ] I agree with the respondent’s calculations.

The real estate commissions associated with the assignment of the Oasis Condo ($63,577.50) and distributive taxes that will be paid by 086 Ltd. ($24,000) must be deducted, leaving the parties to equally divide the net profit of $3,522.50 (or $1,761.25 each). Calculation of the Claimant’s interest in the shares of Trademark, Superior Septic and 086 Ltd. (“Companies”) [ 44 ] In the Reasons, I awarded the claimant 25% of the increased value in the Companies’ shares during the parties’ cohabitation.

While the parties agree that the increased value of those shares was $2.29 million, they do not agree on what should be deducted from that value to reflect that the Apartment Block and Oasis Condo (both owned by 086 Ltd.) are to be considered separately. [ 45 ] At paras. 239 and 264 of the Reasons, I stated: [239] The equity in the Apartment Block, net of taxes as discussed below, is to be divided equally between the parties and deducted from 086 Ltd.’s share valuation prior to determining the 25–75 share valuation in the respondent’s favour. . . . [264] I conclude that it is appropriate to consider certain distributive taxes in valuing the shares of the Companies.

Accordingly, the valuation of 086 Ltd. will be discounted by $310,000, in total, for distributive taxes, namely $286,000 respecting the Apartment Block and $24,000 respecting the Oasis Property. [ 46 ] I did the same thing with the net proceeds of the Oasis Condo. My intent was that distributive taxes were to be deducted from the equity of the Apartment Block and Oasis Condo prior to determining the claimant’s one-half interest.

My intent was also that both the Apartment Block and Oasis Condo were to be hived off from 086 Ltd. prior to determining the claimant’s 25% equity in the increased value of 086 Ltd.’s shares during the parties’ cohabitation. Save for the Apartment Block and Oasis Condo, I determined that the respondent would not be selling the shares of the Companies and therefore distributive taxes were not to be deducted from the Companies’ share values. [ 47 ] As noted, the parties agreed that the increased value of the Companies’ shares during the parties’ cohabitation was $2.29 million.

From this amount, the equity in the Apartment Block (as determined above which is net of distributive taxes) of $586,241.30, and the net equity in the Oasis Condo (as determined above net of commissions and distributive taxes) of $3,522.50 must be deducted, leaving a balance of $1,700,236.20. [ 48 ] The respondent maintains that this calculation would be erroneous and result in some “double-dipping”.

He points to para. 264 of the Reasons (referenced above) in support. [ 49 ] The $310,000 discount to 086 Ltd.’s share valuation was based on assumed distributive taxes of $286,000 payable on the sale of the Apartment Block at $1.5 million. As we now know, the respondent sold the Apartment Block for $1.15 million resulting in actual distributive taxes of only $175,000.

Accordingly, the para. 264 calculation requires an adjustment from $310,000 to $175,000 to reflect the correct amount. [ 50 ] Taking all of this into account, I have determined that the claimant’s 25% interest in the shares of the Companies is $425,059.05, for which the respondent must account ($1,700,236.20 x 25% = $425,059.05). Sharing of costs of Appraisal and Joint Expert Reports

[ 51 ] In a judicial case conference held on November 19, 2020, the parties consented to appraising their real estate holdings owned before their cohabitation as at the date of cohabitation and at their current values, and appraising their real estate holdings purchased during cohabitation at their current values (“JCC Order”). They agreed that the claimant would pay 30% and the respondent would pay 70% of obtaining the appraisals.

That consent order was not made on a without prejudice basis. [ 52 ] In the same order, the parties agreed to a joint appraisal of the historical and current values of the Companies with the cost of the appraisal to be paid by the company being appraised. Contrary to the order respecting the real estate appraisals, this order was made on a without prejudice basis. [ 53 ] Real estate appraisals and share valuations were obtained in due course and paid for in accordance with the JCC Order. The cost of obtaining joint appraisals of the parties’ personal real estate totalled $10,941.

The cost of having the Companies’ shares appraised totalled $62,205.61. The parties agree that all appraisals were necessary. [ 54 ] The respondent seeks an order that the claimant pay 50% of all appraisal costs. He says that he understood the JCC Order was an interim order and that the responsibility to pay costs would be dealt with after trial. [ 55 ] The claimant says that the JCC Order is specific as to how the appraisals were to be paid. She says that the parties agreed to the order because of the financial imbalance of the parties at the time and no application to vary the JCC Order was made.

She points to R. 13-4(1) of Supreme Court Family Rules [ Rules ] that prescribes, inter alia , that before an expert is appointed, responsibility for the experts’ fees must be settled. She says that is precisely what was done in the JCC Order and by agreement. Accordingly, she says the respondent must pay 70% of the real estate appraisal costs. [ 56 ] Respecting the Companies’ share valuations, the claimant points out that the Companies are not parties to this proceeding.

In accordance with the JCC Order, the cost of valuing the Companies’ shares was to be paid by the company being valued, not the respondent personally. The claimant asserts that the respondent did not personally pay for those valuations and cannot now seek reimbursement. She says there is no legal authority for the respondent to recover costs which he has not incurred.

Further, she argues that the Companies were likely able to deduct the appraisal costs and obtain a tax savings. [ 57 ] I agree with the claimant’s position on both the real estate appraisal costs and the share valuation costs. [ 58 ] The JCC Order is clear that the parties would split the costs of the real estate appraisals on a 70/30 basis and that part of the order was not without prejudice to the respondent being able to claim reimbursement from the claimant.

In my view, the JCC Order stands. [ 59 ] In my Reasons, I determined that the increased value of the Companies’ shares was family property, and that the claimant has a 25% interest in that increased value. Accordingly, because the Companies paid for the share valuation appraisals, the claimant has indirectly already paid 25% of the cost. [ 60 ] As a result, while I accept that I have discretion to vary and replace the JCC Order, I decline to do so. There will be no order that the claimant be required to repay the costs of the expert reports.

Reconsideration of the Claimant’s income [ 61 ] The parties separated in July 2020, and since August 1, 2021, the respondent has been paying spousal support of $4,274 per month and child support of $1,193 per month in accordance with the order of Justice Davies made on July 28, 2021. Those support payments terminated on delivery of the Reasons. [ 62 ] At para. 282 of the Reasons, I assessed the claimant’s Guideline income from the date of separation at $91,852, made up of $51,852 (from a combination of CPP disability benefits of $16,740 per year, support payments from Mr.

Gibson of $15,000 per year and $20,112 per year equivalent of the Air Canada pension she would have received but for the buyout she elected), and $40,000 imputed income. [ 63 ] The claimant seeks a reconsideration of her income from the date of separation because she says she did not receive the amounts I assessed in the Reasons. [ 64 ] From the date of separation to May 2022, she received $21,000 from both CPP and Air Canada and $15,000 from Mr. Gibson for a total of $36,000.

She argues that if she is able to earn the $40,000 I imputed to her in that time frame, she would not have been able to receive CPP disability benefits and therefore her earnings would only be $55,000 ($40,000 + $15,000). [ 65 ] From May 2022 (when the claimant opted for a buyout of her Air Canada pension) onward, she argues that her income should be imputed at $75,112 ($40,000 imputed income + $20,112 she would have received from Air Canada but for the buyout + $15,000 from Mr.

Gibson) and not $91,852 because she would not be entitled to receive CPP disability benefits. [ 66 ] The respondent says that, given that I have already exercised discretion in determining the claimant’s income, I ought not to entertain a reconsideration because it would amount to relitigating the issue.

He says that I cannot speculate on whether there would be a claw back from the claimant’s CPP disability income as against the $40,000 income I imputed to her. [ 67 ] I agree with the respondent. [ 68 ] There was no evidence led that by imputing income to the claimant, she would not be able to receive CPP disability benefits or Air Canada disability benefits prior to opting to take a lump sum buyout. [ 69 ] The amount of Guideline income I imputed to the claimant is not actual income. It is imputed income for support purposes only.

It is not income that she has earned but a theoretical income based on my determination that she had the capacity to earn income. As two

examples, she displayed the ability to earn rental income and she professed her talents as an interior designer. [ 70 ] In the end, I imputed income to the claimant based on my assessment of the evidence and her ability to earn income. I determined that the claimant demonstrated she had marketable skills and/or that she had the ability to earn rental income. [ 71 ] Accordingly, I decline to reconsider the claimant’s income.

Reconsideration of the Respondent’s income [ 72 ] The claimant also seeks a reconsideration of the respondent’s income for support purposes. [ 73 ] At para. 286 of the Reasons, I assessed the respondent’s Guideline income at $200,000 using an average of three prior years ($103,026 in 2020; $274,898 in 2021; and $227,197 in 2022). [ 74 ] The determination of the respondent’s Guideline income was not a simple exercise.

He derives income through employment and dividend earnings from the Companies who, as they are entitled to do, retain earnings for such things as future expansion and replacement of expensive equipment. The Companies rely heavily on financial assistance from their banks. The Companies also pay a significant portion of the respondent’s personal expenses that are accounted for annually. [ 75 ] The respondent argues, and I agree, that by bringing an application to reconsider the respondent’s income, the claimant is again seeking to re-litigate the issue and have a second kick at the can.

Such practice is to be discouraged: A.D.J v. F.J. , 2022 BCSC 1974 at para. 46 . [ 76 ] Thus, the claimant’s application for a reconsideration of the respondent’s income is dismissed. [ 77 ] One additional matter that wasn’t raised during submissions, is that the respondent was able to deduct spousal support from his income and the claimant was required to pay income tax on the spousal support she received.

To the extent it is determined, pursuant to the Reasons, that he has overpaid spousal support, and to the extent he has been able to deduct that overpayment from his income and the claimant has paid taxes on the overpayment of spousal support, it seems to me that needs to be factored into the amount of the overpayment. That is, the claimant should only be required to repay the overpayment of spousal support net of the income taxes she was required to pay on that overpayment. [ 78 ] If the parties are unable to agree on this amount, they have liberty to apply.

The Apex Chalet [ 79 ] I will next deal with the issue of the Apex Chalet. It was purchased by the parties in August 2018 for $525,000. I concluded in the Reasons that the claimant contributed roughly 22 percent of the down payment (approximately $25,000) and the respondent the rest (approximately $91,000). I also concluded that although the Apex Chalet was registered in the respondent’s name, he held 50 percent of it in trust for the claimant.

Accordingly, I found that each party is entitled to a one-half interest in it. [ 80 ] Because both expressed a passionate interest in keeping the Apex Chalet exclusively for themselves, I ordered, instead of it being sold with the consequent capital gains taxes that would advantage neither, that each party would have the option of buying the other’s one-half interest by submitting sealed bids to the Court within 30 days of receipt of the Reasons.

I directed that each were to put their best foot forward in making their respective bids. [ 81 ] The parties provided sealed bids as ordered which I opened in Court on October 27, 2023. The parties each placed the following values on the Apex Chalet as its fair market value, which included all furnishings, appliances and fixtures:

a) Claimant: $1,010,000; and

b) Respondent: $815,000. [ 82 ] In the end, the claimant was the successful bidder. She has secured funding to payout the existing Bank of Montreal mortgage currently registered against the Apex Chalet (“BMO Mortgage”). [ 83 ] I was advised during the November 23 and 24, 2023 hearing, that on August 19, 2023, prior to the Reasons being delivered and again contrary to the restraining order, the respondent entered into a non-arm’s length tenancy agreement with Mr. Robert Perret, who I was told is a friend of the respondent.

It was clear at the time that both parties wanted the Apex Chalet, and nothing should have been done with it, including unilaterally renting it, pending my decision. [ 84 ] I was also advised that the respondent had moved into the Apex Chalet days before the November 23, 2023 hearing with full knowledge that the claimant had out-bid him and would be taking exclusive ownership of the Apex Chalet. [ 85 ] I was not prepared to accede to the respondent’s submissions that the transfer of the Apex Chalet should be deferred and occur concurrently with equalization payments when the final numbers have been determined.

I ordered the forthwith transfer of the Apex Chalet into the claimant’s name with the existing mortgage paid out at her cost. The Apex Chalet’s equity to be split equally between the parties would be determined based on its fair market value of $1,010,000 less the balance of the BMO Mortgage when paid out and the final numbers were known. [ 86 ] According to the agreed statement of facts, the balance of the BMO Mortgage was $371,615.41 as at February 14, 2022. In

approximate terms, the current balance would be about $350,000. On that basis, the equity in the Apex Chalet is $660,000 and theclaimant must account to the respondent for $330,000. [87] I shall leave it to the parties to determine the actual equity once the payout of the BMO Mortgage and usual adjustments areknown. Costs [88] The respondent seeks costs of this proceeding based on his position that he was the substantially successful party on the mainissues at trial.

The claimant submits that neither party enjoyed substantial success and that each party should bear their own costs. [89] The claimant says she was the successful party on issues related to the manufactured home, on whether distributive taxes shouldbe deducted from the Companies’ share values, on ownership of the Oasis Condo and the Apartment Block, on the nature and purpose ofmeetings the parties had with advisors and accountants, on her expectation that she was the respondent’s partner in business, on travelpoints and on the respondent’s insurance policy. [90] The respondent says that he was the substantially successful party on the main issue in dispute, namely whether there should be areapportionment of the increased value of shares of the Companies.

He says he was also the successful party on issues related to spousaland child support. Substantial success – The law [91] The principles surrounding the order of costs is not in dispute. Costs in matrimonial proceedings generally follow the eventunless the court, as a matter of discretion to be exercised judicially, orders otherwise: Gold v. Gold, 106 D.L.R. (4th) 452 at paras. 19–20, (B.C.C.A.); Rules, R. 16-1(7). [92] The decision to award costs after a trial typically follows this four-step inquiry: 1. First, by focusing on the "matters in dispute" at the trial.

These may or may not include "issues" explicitly mentioned in the pleadings. 2. Second, by assessing the weight or importance of those "matters" to the parties. 3. Third, by doing a global determination with respect to all the matters in dispute and determining which party "substantiallysucceeded," overall and therefore won the event. 4. Fourth, where one party "substantially succeeded," a consideration of whether there are reasons to "otherwise order" that the winningparty be deprived of his or her costs and each side then bear their own costs. Fotheringham v.

Fotheringham, 2001 BCSC 1321 at para. 46. [93] As a “rough and ready” guide, the term “substantial success” has been defined in the authorities to mean where the prevailingparty succeeds on 75 percent or more of the matters in dispute. The disputed matters are to be considered globally with a focus on theweight and importance of the matters in dispute and the parties’ relative success or failure on those matters. Where, as is the case here,there were multiple issues involved with divided success, a flexible approach to the “substantial success” analysis is required.

It is to bemeasured in broad terms and the court is not to finely parse issues or conduct a tallying of the issues in evaluating success: Wallace v.Pichichero, 2021 BCSC 2347 at paras. 15–16 quoting from Jin v. Cheng, 2019 BCSC 148 at paras. 18–19. Analysis [94] The main area of dispute between the parties and the key issue at trial was how to divide the increased value of the Companies’shares. The joint expert valuation which the parties agreed to was that the increase was $2,290,000. That sum included the equity in theApartment Block and the equity in the Oasis Condo.

The claimant sought an award of 50% of that increase, or $1,145,000. Therespondent argued that she should be entitled to only 10% of that increase, or $229,000. The mid-point between the two positions was$687,000. [95] I awarded the claimant 25% of the increased value after hiving off the equity in the Apartment Block and equity in the OasisCondo, which were to be treated separately, and which I have determined above to be $586,241.30 for the Apartment Block and$3,522.50 for the Oasis Condo.

The total to be hived-off from the Companies’ valuation is $589,763.80 ($586,241.30 + $3,522.50). [96] Deducting this amount from the Companies’ valuation leaves $1,700,236.20 ($2,290,000 - $589,763.80). The claimant’s 25% is$425,059.05. Adding back her one-half share of the equity in the Apartment Block and the Oasis Condo totals $719,940.92. [97] By these calculations, the claimant was awarded more than the mid-point between the parties’ respective positions.

Accordingly,on the main issue between the parties, neither can be considered to have been substantially successful. [98] There is no doubt that the division of shares was by far the most significant issue, had the most money at stake and consumedmost of the trial time. The other issue that consumed significant time was the ownership of the Apartment Block, in which the claimantsucceeded. From a global perspective, the claimant was successful in recovering 50% of the increased value of all family property and25% of the increased value of the Companies’ shares.

The respondent was successful in obtaining a ruling for the unequal division of theincreased value of the Companies’ shares, but not by the 90% / 10% amount he sought. He was also wholly successful on issues relatedto spousal and child support issues but, in my view, those issues were minor by comparison to the division of shares issue.

[ 99 ] With the legal principles and my global assessment of each party’s success in mind, I have concluded that there should be no order for costs and each party shall bear their own costs. Equalization payments [ 100 ] In paras. 308 and 312 of the Reasons, I list the parties’ assets and properties that are to be owned free and clear from any claim by the other.

I left it to the parties to determine the required equalization payment after accounting for support payment set-offs, the determination of the claimant’s 25% interest in the increased value of the Companies’ shares, the claimant’s one-half interest of equity in the Apartment Block, Oasis Condo, the ownership of the Apex Chalet and the like. [ 101 ] My intention was that, in determining the equalization payment to be made, the increase in value of all assets during the parties’ cohabitation is to be included. [ 102 ] To assist the parties and as a quick reference, I attach as Appendix “A” an equalization payment chart based on the Reasons, the agreed statement of facts, and these supplemental reasons.

Some of the numbers are unknown and remain to be determined (for example repayment of spousal and child support). Other numbers have been approximated and/or have been left to the parties to calculate. The

schedule is intended simply to assist in the final resolution of the issues between the parties.

Summary [ 103 ] To summarize, my orders are:

a) The claimant is entitled to $293,120.65 as her share of the Apartment Block’s equity;

b) The Oasis Condo equity is determined to be $3,522.50 to be split equally by the parties;

c) The claimant’s 25% interest in the increased value of the Companies’ shares net of hiving of the equities in the Apartment Block and Oasis Condo, is $425,059.05;

d) The respondent’s application that the claimant equally shares the costs for expert appraisal reports is dismissed;

e) The claimant’s application to have both her and the respondent’s Guideline income reconsidered for support purposes, is dismissed;

f) The claimant must account to the respondent for his 50% interest in the Apex Chalet’s equity of approximately $330,000 (subject to final closing numbers);

g) The increased value of the parties’ properties during their cohabitation is to be accounted for in the final equalization payment calculation; and

h) Each party will bear their own costs throughout. [ 104 ] Once again, should the parties need further clarification or assistance of finalizing matters, they may make the appropriate arrangements with Supreme Court Scheduling. “G.P. Weatherill J.” Appendix “A” Disputed Family Property Division Chart – Based on Increased Values During Cohabitation as set out in the Agreed Statement of Facts and Reasons for Judgement, as the case may be.

The numbers have been rounded ASSET DESCRIPTION Claimant Respondent Real Property 121 Uplands Court Property Increased Equity $383,957 88 Lower Bench Property Increased Equity $545,020 Prince George Apartment $586,241 1166 Apex Mountain Road (the Apex Cabin) $195,000 124 Creekview Road (the Apex Chalet Equity) Taken into account below Taken into account below Oasis Condo Proceeds $3,522 Manufactured Home $87,000 Chattels

1998 Carver Yacht Excluded Investments and bank accounts Air Canada Pension Taken into account in Support calculations TFSA (Leanne) $6,070 National Bank RRSP (Tom) (discounted by 30%) Companies The Claimant’s 25% interest in the increased value of shares of Trademark Industries Ltd., 0867873 BC Ltd. and Superior Septic Services Inc. (to be accounted for separately) As below As below Other Diamond Ring gifted to Leanne by Tom $36,000 Multi-band diamond ring $2,200 Diamond earrings $2,800 TAG watch $850 Gent’s diamond solitaire ring $500 IA life insurance policy #951379XXXX $45,969 Total: $787,090 $1,108,039 Claimant’s Share of Family Property $787,090 Respondent’s Share of Family Property $1,108,039 Difference in Family Property $320,949 Equalization Payable by respondent to claimant as above for all property save the Apartment Block and Shares: $160,475 Amount owed by respondent to claimant for Apartment Block: $293,120 Amount owed by respondent to claimant for Her 25% interest in the increased value of the Companies Shares: $425,940 Amount owed by claimant to respondent for his one-half Interest in the Apex Chalet (approximate): $330,000 Amount owed by claimant to respondent for over- payment of spousal support ($4,274 per mo.): TBD Amount owed by claimant to respondent for over- payment of child support ($1,193 per mo.): TBD