Walker v. Baker, 2010 NSSC 440

IN THE SUPREME COURT OF NOVA SCOTIA (FAMILY DIVISION) Citation: Walker v. Baker, 2010 NSSC 440 Date: 2010 11 30 Docket: SFHMCA-057933 Registry: Halifax Between: James Walker Applicant v. Rosemary Baker Respondent LIBRARY HEADING Judge: The Honourable Justice Leslie J. Dellapinna Heard: November 22 and 23, 2010 in Halifax, Nova Scotia Subject: Custody and access, the division of assets, child maintenance (retroactive and prospective) and prospective spousal maintenance.

Summary: The parties lived in common-law relationship for approximately ten years and had two children aged 12 and 7 as of the date of the hearing. They were unable to agree on a parenting arrangement or any of the financial issues. Issues: 1. The parenting arrangements regarding the two children. 2. The division of the few remaining assets owned by the parties. 3. The calculation of the father’s income for child maintenance purposes in view of the fact that he received a significant portion of his income in the form of dividends. 4. Child maintenance, both prospective and retroactive to January 1, 2010. 5. Prospective spousal maintenance.

Result: Behavior of both parties was adversely affecting the children. The older of the two children refused to see her father. There was no identifiable reason why the father should not have a relationship with the children. A detailed parenting arrangement was ordered which was subject to the wishes of the 12 year old daughter. Primary care was granted to the mother because she had been the primary parent to the children prior to separation and they has been with her since the parties separated approximately three years prior to the Court hearing.

Additional income was imputed to the father in 2010 because in that year a significant portion of his income was received in the form of dividends. An explanation for how the imputed income was determined in included in the decision. The father was ordered to “top up” his 2010 child maintenance payments and prospective child maintenance was ordered based on an estimate of his income in future years and the Child Maintenance Guidelines . Spousal maintenance of $1,000.00 per month was also ordered. THIS INFORMATION SHEET DOES NOT FORM PART OF THE COURT'S DECISION.

QUOTES MUST BE FROM THE DECISION, NOT THIS LIBRARY SHEET . IN THE SUPREME COURT OF NOVA SCOTIA (FAMILY DIVISION) Citation: Walker v. Baker, 2010 NSSC 440 Oral Decision Date: 2010 11 30 Docket: SFHMCA-057933 Registry: Halifax Between: James Walker Applicant v. Rosemary Baker Respondent

Judge: The Honourable Justice Leslie J. Dellapinna Heard: November 22 and 23, 2010, in Halifax, Nova Scotia Written Decision: November 30, 2010 Counsel: S. Faught counsel for James Walker S. Young counsel for Rosemary Baker DECISION: INTRODUCTION [ 1 ] This proceeding arises out of two applications - one made by each of the parties.

James Walker (the Applicant) seeks an order pursuant to the Maintenance and Custody Act R.S.N.S. 1989, c. 160 (as amended) and more specifically seeks an order for joint custody of the parties’ two children and access. [ 2 ] Rosemary Baker (the Respondent) has also applied under the Maintenance and Custody Act seeking sole custody of the parties’ two children as well as orders for child maintenance (prospective as well as retroactive to January 1, 2010), prospective spousal maintenance and a division of property owned by the parties at the time of their separation.

BACKGROUND [ 3 ] The parties co-habitated in a common-law relationship beginning in the fall of 1997. Together they have two children namely Rebecca born September 21, 1998 and Chloe born July 9, 2003. [ 4 ] During their relationship the Applicant assumed the role as the primary income earner. The Respondent gave up her employment when their first daughter was born. Since then she was primarily responsible for the care of the children and maintaining the family's home.

[ 5 ] The Respondent's evidence suggests that the parties' relationship was marred by physical and emotional abuse by the Applicant, an allegation that he denies. [ 6 ] The parties separated in August 2007. The children remained in the primary care of the Respondent. The Applicant exercised access to both children until May of 2008. At that time Rebecca began to refuse to see her father for reasons that remain unclear to the Court.

The Respondent's theory is that Rebecca's decision resulted from experiencing the Applicant's abusive behaviour directed primarily toward the Respondent but also because he used physical punishment to correct the children. The Applicant believes that the Respondent influenced Rebecca such that she now adopts the same acrimonious position against him as does the Respondent. [ 7 ] The Applicant has continued to exercise access to Chloe although, judging from the Court's file, it would appear that in order to secure such access numerous court appearances were necessary.

The Applicant's parenting time has been inconsistent. It has been complicated by the needs of his employment which have from time to time required him to leave the province for work. His parenting time has been further complicated by the fact that the Respondent has not been supportive of his time with the children. [ 8 ] The relationship between the parties has been described as one of high conflict although the Applicant believes that it is only the Respondent that creates that conflict.

From my review of the evidence and judging from the testimony and demeanor of the parties, both must share some degree of responsibility for the situation in which they now find themselves. [ 9 ] The Applicant is 48. He describes himself as a self-employed quality control specialist in the oil and gas industry. He owns 100% of the common shares of a company that I will simply refer to as J.D.W. which company is involved not only in the oil and gas industry but also in the business of diving.

It would appear that the majority of the company’s income and therefore the Applicant’s income came from the oil and gas industry. [ 10 ] The Applicant hires himself out to various companies in various parts of the country but more recently in Nova Scotia, off the coast of Nova Scotia and in Alberta. Historically his services are billed by J.D.W. and he then in turn was compensated by way of dividends from his company.

In 2010 the majority of his income was in the form of employment income as he has been hired as a temporary employee rather than as a contractor. [ 11 ] The Respondent owns one thousand preferred shares in J.D.W. (as does the Applicant) which entitle her to receive dividends "when, as and if declared by the Directors of the Company". The Applicant is the sole officer of the company. [ 12 ] The Respondent is 41 years of age. The parties first met in Ontario in 1995. She was at that time employed with a company in that province for approximately ten years.

As stated earlier, after their oldest daughter was born she left her employment and with the exception of a few part-time positions that she obtained subsequent to the parties' separation, she has not been employed outside of the home. [ 13 ] The parties' oldest daughter is now 12 years of age. She does well in school and gets good grades and is well behaved. She has a number of friends and has taken

part in various extracurricular activities. However, it is the Respondent's evidence that she is a high needs child and has been since birth. She has been diagnosed in the past as having ADHD as well as general anxiety disorder. [ 14 ] In an assessment report dated March 1, 2010 prepared by Dr. Lowell Blood at the request of the Court, it was stated at page 27: "She has good social relationships and does well in school. However, she has also struggled with behavioural and emotional control from an early age. It seems highly likely that exposure to her parents' toxic relationship contributed to her difficulties.

At present, she has a very damaged relationship with her father and has refused to see him for access. However the content of her present anxieties go beyond her relationship with Mr. Walker. Becky's difficulties need to be understood and treated as generalized, as opposed to specific to this relationship.

Unfortunately, continuous exposure to the issues of her parents has likely caused Becky emotional harm. Both Ms. Baker and Mr. Walker have responsibility for contributing to this harm. Ms. Baker has exposed Becky to her own fears and concerns with respect to Mr. Walker, to the extent that Becky now endorses these fears as her own. Mr. Walker has been insensitive to Becky's difficulties, preferring to view the damage in their relationship as caused by Ms. Baker, and to a lesser extent, Becky herself. It is absolutely imperative that these parents find a way to cease involving Becky in their own issues.

She is a victim of their seeming inability to behave as mature and responsible parents." [ 15 ] Chloe is seven years of age and is in grade two. She too does well in school and does not present any behavioural problems. She gets along well with her peers. [ 16 ] Regarding Chloe, at page 27 of the aforementioned report the following is said: "Chloe impresses as a resilient child who has managed, on her own, to navigate this toxic environment with seemingly little harm. However, she is a child at great risk, as she is now the child placed squarely in the middle of the ongoing dispute between her parents.

She should not be placed in the position of having to deal with a loyalty bind, with her father on one side and her mother and sister on the other. Unless these parents are able to find a way to not continuously engage each other in foolish, hateful and damaging interactions, Chloe, too, will be harmed." [ 17 ] The parties have been unable to agree on the ongoing parenting arrangements with respect to the children. The Applicant seeks a meaningful relationship with his daughters including reasonable time with them and a say in how they are raised.

The Respondent wants sole decision making authority and although she says she does not want to shut the Applicant out of the lives of the children she does wish that he played no role in her life. [ 18 ] The parties have also been unable to agree on the financial issues. ISSUES [ 19 ] Therefore, the issues are as follows: 1. The custody and access arrangements with respect to the parties' two children. 2. The division of the few remaining assets owned by the parties. 3. Child maintenance, both prospective and retroactive to January 1, 2010. 4. Prospective spousal maintenance. ANALYSIS Custody and Access

[ 20 ] From reading all of the affidavits that the parties have filed since the commencement of this proceeding and after hearing their evidence during the trial held before me, I agree with the opinion of Dr. Blood that they both must share responsibility for the breakdown in Becky's relationship with her father and they run the risk of causing Chloe harm as well. Dr. Blood in the assessment report said at page 28: "Ms. Baker must stop enlisting Becky as an ally in her battle with Mr. Walker. While Ms.

Baker may not be actively alienating her children against their father, it is clear that she would prefer not to have him in her life and that she has used opportunities to exclude him from the lives of their children. This must end. There is simply no compelling reason why Mr. Walker should not have a relationship with his daughters." [ 21 ] As for Mr. Walker, Dr. Blood said: "Jim Walker also undoubtedly cares for his children. He would appear to have much to offer them as a father. However, he must understand that he has made a large contribution to the damage in his relationship with Becky.

He must also understand that maintaining a relationship with his children cannot be entirely on his own terms. They have lives that are independent from his needs and desires. He must be willing to show some flexibility around his contact with them and, with respect to Becky, must show some willingness to work on a relationship rather than demand a relationship." [ 22 ] I agree with those comments. In fairness to the Applicant, I believe that he is trying to follow Dr. Blood's advice. [ 23 ] Dr.

Blood's recommendations are as follows: 1) Becky Baker and Chloe Baker remain in the primary care of their mother, Rose Baker and that Ms. Baker have primary decision making with respect to Becky and Chloe. Mr. Walker should be provided with information regarding educational, mental health, medical, and extra-curricular activities which involve the girls. 2) Mr. Walker have regular and consistent access with Chloe. In the absence of a third party that is willing and able to arrange access around Mr.

Walker’s schedule, it is suggested that a traditional access schedule, such as every other weekend and one evening during the week be maintained. Mr. Walker would need to provide a work

schedule to Ms. Baker so that all would be aware when Mr. Walker is out of province and access will not occur. Extended access at Christmas and in the summer should continue to occur. 3) Becky re-engage in mental health treatment. Addressing issues around family dynamics should constitute one aspect of that treatment. Both Ms. Baker and Mr. Walker should be involved in this treatment, at the discretion of the therapist. 4) Access between Mr. Walker and Becky be co-ordinated with treatment Becky receives.

It is reasonable to expect that initial contact occur in the context of that treatment and that some supervision of contact be maintained, while work around the relationship occurs. 5) Mr. Walker continues in treatment and begins to address his own contribution to the access difficulties and his damaged relationship with Becky.

6) Ms. Baker returns to treatment to address her contribution to the access difficulties and the damage that has been caused to Becky. [ 24 ] With the evidence that has been presented I cannot offer a solution for the breakdown in the relationship between Becky and her father. Unless Becky is willing I see little point in ordering the Respondent to obtain further mental health treatment for Becky with a view to addressing the breakdown in her relationship with her father. I do however implore her to consider that possibility for her daughter's sake.

She indicated during her cross examination that she could understand how the children would be worse off without a relationship with their father. Knowing that it is the Court's hope that she will do all that she can to repair the damage in their relationship. Counselling for Becky may be a good beginning. [ 25 ] My order will allow access to occur subject to Becky's wishes-keeping in mind that she is 12 years of age and from all accounts strong-willed.

I also recommend to both parties that they engage in or continue to pursue their own counselling in order, among other things, to learn methods to constructively communicate with each other on matters relating to the children. Thus far, as said by Dr. Blood, they have been two intelligent and caring parents who have behaved badly.

If they care for their children as much as I believe they do, they must find their own ways to change things for the better in the future. [ 26 ] Subsection 18 (5) of the Maintenance and Custody Act provides as follows: "In any proceeding under this Act concerning care and custody or access and visiting privileges in relation to a child, the court shall apply the principle that the welfare of the child is the paramount consideration." [ 27 ] With that in mind I have crafted a parenting arrangement that I believe will serve the children’s best interests for at least the immediate future.

I order as follows: PARENTING TIME 1. The children will be in the primary care of the Respondent. I have intentionally avoided the word "custody" or the words "joint custody" because I believe that the use of such words in the order will lead to one or the other of the parties feeling empowered by my decision. I am not naive enough to believe that my decision will end the ongoing disputes between the parties but I have no desire or intention to add to the intensity of those disputes by giving either party the impression that they now have the upper hand over the other. 2.

The Applicant will have reasonable and liberal parenting time with both children on the understanding that his parenting time with Rebecca will be subject to Rebecca's wishes and his parenting time will include the following:

a) Every second weekend commencing December 3, 2010 from Friday at 5:00 p.m. until the following Sunday at 6:00 p.m. during the months of September to June inclusive each year. During the months of July and August the Applicant's parenting time will be extended to 8:00 p.m. on Sunday.

b) During the months of July and August of each year the Applicant will also have parenting time with the children one weekday each week from 10:00 a.m. until 8:00 p.m. which day is to be agreed upon by the parties in advance and failing an agreement will occur on Wednesday of each week.

c) The Applicant will be permitted to have parenting time with the children one week each in the months of July and August (which two weeks will not be consecutive unless the parties agree otherwise). Such parenting time will commence at 5:00 p.m. on a Friday during a weekend in which the Applicant would normally have the children for the weekend and will conclude at 5:00 p.m. on the following Friday.

d) The Applicant will have parenting time with the children during the children's March Break from school in alternate years beginning in the year 2012. For the purpose of this provision the March Break is defined as being from 5:00 p.m. on the Friday on the last day of the children’s school prior to the March Break and continuing to 5:00 p.m. on the Sunday prior to the children’s recommencement of school subsequent to the March Break. The Respondent will have parenting time with the children during their March Break (as defined herein) in even numbered years commencing in the year 2013.

In 2011 the children’s March Break is comprised of two weeks in the month of February during which each of the parties will have parenting time with the children for one week. Unless they agree otherwise the Respondent will have the care of the children during the children’s first week of their March Break and the Applicant the second week.

e) The Applicant will have parenting time to the children on Father's Day of each year from 10:00 a.m. until 6:00 p.m..

f) The Applicant will parenting time with the children from December 26 at noon to December 31 at 8:00 p.m. each year commencing in December, 2010; and

g) The Applicant will be permitted to have reasonable telephone contact with the children when they are in the care of the Respondent. 3. The Respondent will also be permitted to have two weeks (of 7 days each) exclusive parenting time with the children during the months of July and August which two weeks will not be consecutive unless the parties agree otherwise and will not interfere with the Applicant's two weeks with the children referred to in 2 ( ​ ) above, but which parenting time may and likely will interfere with the parenting time that the Applicant would otherwise have with the children as described in paragraphs 2(

a) and 2(

b) above. 4. The Respondent will also have parenting time with the children each Mother's Day even if Mother's Day falls on the Applicant's weekend with the children and in that event her time with the children will be from 10:00 a.m. until 6:00 p.m.. 5. The Respondent will have reasonable telephone contact with the children when they are in the care of the Applicant. TRAVEL WITH THE CHILDREN 6.

The Applicant will be permitted to travel outside the province of Nova Scotia with the children during his summer block time with the children, during his March Break with the children and during his Christmas parenting time with the children. For further clarity the Applicant may also take the children outside of Canada for vacation purposes and the Respondent will sign whatever documentation may be required by the Applicant for the purpose of crossing international boarders with the children.

Prior to removing the children from the province of Nova Scotia for vacation purposes the Applicant will provide the respondent with written advance notice of his intention to do so which notice will be given to the Respondent no later than three weeks prior to his departure with the children and will include his departure time, expected return date, a brief description of where he intends to travel with the children and where and how he and the children may be contacted in the event of an emergency.

The Applicant will also permit the children to contact the Respondent by phone on at least one occasion on each day while they are outside the province of Nova Scotia for vacation purposes. 7. Similarly, the Respondent will be entitled to travel outside of the province of Nova Scotia with the children during her parenting time with the children provided she too provides the same advance notice to the Applicant and also provides him with a brief description of where she intends to travel with the children and where and how she and the children may be contacted in the event of an emergency.

The Respondent will also permit the children to contact the Applicant by phone on at least one occasion on each day while they are outside the province of Nova Scotia for vacation purposes. The Applicant will cooperate by signing whatever documentation may be required by the Respondent for the purpose of crossing international boarders with the children. 8. When the children travel outside the province of Nova Scotia they will be in the company of one of the parties or another adult

person approved by both of the parties. 9. The parties will assist each other in the acquisition of a passport for both children. This assistance will include, but not be limited to, signing any documents required by Immigration Canada to acquire a passport. The Respondent will apply for the children's passports on or before January 31, 2011 and will keep the passports current. The cost of the passports will be paid by the Applicant. NOTICE BY APPLICANT 10.

If at any time the Applicant becomes aware that he is unable to exercise parenting time with the children as provided by the Court's order, he will immediately notify the Respondent of his inability to do so and in any event will notify her no later than 24 hours in advance of the commencement of what was to be his parenting time with the children. COMMUNICATIONS 11. Communications between the parties will be by way of e-mail except in the event of an emergency where telephone contact is to be used. DECISION MAKING 12.

a) The day-to-day decisions respecting the children's care will be made by the party with whom the children are then residing.

b) Both parties will have the authority to authorize emergency medical care and treatment for the children. Should such a medical authorization be made the parent making that decision will, as soon as possible, notify the other parent of the nature of the medical emergency and the treatment authorized.

c) Neither party will make any major developmental decision regarding the children without first discussing the decision to be made in a meaningful way with the other parent in which event the parties will attempt to jointly decide upon the decision that is to be made. A major developmental decision is defined as one that affects the children's health (including physical, mental and emotional health), education and general welfare.

If after a meaningful consultation between the parties and they are unable to reach an agreement on the decision to be made the Respondent will have the authority to make the decision provided that in making that decision she is guided by the principle that the welfare of the child is the paramount consideration. INFORMATION CONCERNING THE CHILDREN 13. Each party is separately entitled to make inquiries and to be given information relating to the health, education and welfare of the children from all persons and institutions having such information in their possession or control. 14.

Each of the parties will provide to the other in a timely fashion any information they receive regarding the children including information regarding the children's education, extracurricular and recreational activities and their physical, mental and emotional health. 15. The Respondent will advise the Applicant immediately each year when the children's school photographs are available for purchase. The Applicant will cover the cost of any photographs that he orders and if such photographs are received by the Respondent

she will provide them to the Applicant as soon as practicable. 16. In the event that the Respondent obtains social insurance numbers for either of the children, she will, upon receiving those numbers, forthwith advise the Applicant of the child's social insurance number. MOBILITY 17. Neither party will remove the children from the province of Nova Scotia for the purpose of establishing a new residence without the express written consent of the other parent or an order of the Supreme Court of Nova Scotia, Family Division.

In the event that the Respondent wishes to relocate outside of the province with the children she will give the Applicant no less than 45 days advance written notice of her intention to do so. 18. Subject to a variation of this order by a Court of competent jurisdiction, Canada is deemed to be the habitual residence of the children for the purposes of the Hague Convention on the Civil Aspects of International Child Abduction. TRANSPORTATION 19.

When the Applicant exercises his parenting time with the children, he will be responsible for the transportation of the children from and to the home of the Respondent unless both parties otherwise agree. THE DIVISION OF ASSETS [ 28 ] Very little evidence was presented regarding the division or redistribution of the assets of the parties. The Applicant has consented to a roll-over of one half of his Retirement Savings Account Plan to an RRSP in the name of the Respondent. That roll-over will therefore be ordered. [ 29 ] The Respondent also sought a division of property based on:

a) Equitable relief pursuant to the principles of unjust enrichment, resulting or constructive trust;

b) The Companies Act R.S.N.S. 1989, c. 81; and

c) The Partition Act R.S.N.S. 1989, c. 333. [ 30 ] There was no evidence presented that has convinced me that any such order should be granted and therefore the relief sought under those authorities is dismissed. [ 31 ] The Respondent also sought by way of her application :

a) "Valuation of the 50% of the common shares held by the [Respondent] in the Company known as [J.D.W.];

b) Allocation and accounting of the dividends that may be owed or owing to the [Respondent] as a result of the common shares she holds in [J.D.W.];

c) An order requiring the [Applicant] to direct J.D.W. to buy back the [Respondent's] shares held in J.D.W. at fair market value, within a reasonable period of time; and

d) Such other relief as this Honourable Court deems just with respect to the assets held by the [Respondent], the [Applicant] and by [ J.D.W.]. [ 32 ] The evidence does not convince me that the Respondent is entitled to anything more (or less) than that to which she is entitled by virtue of the fact that she holds 1,000 preferred shares in J.D.W.. She owns no common shares in the company. [ 33 ] The Applicant has indicated that it is his intention to wind down the company in which event the Respondent has certain rights under the Terms and Conditions Attaching to the Class DD-2 Preferred Shares of J.D.W..

The evidence that she has presented is insufficient for me to order anything beyond that. [ 34 ] J.D.W. is a limited company that provides services provided by the Applicant. Without him the company is worth essentially nothing. It appears to have very few assets as well as some debt. As Ms. Faught pointed out, it may very well be that this company will have no positive value. CHILD MAINTENANCE The Calculation of the Applicant's Income [ 35 ] As I stated earlier the children have been in the primary care of the Respondent since the parties separated. The Applicant has been paying maintenance to the Respondent.

It is the Respondent's position that the child maintenance paid this year is less than what the Applicant should have been paying pursuant to the Child Maintenance Guidelines and there is a disagreement over the amount of child maintenance he should be paying prospectively. [ 36 ] Before deciding how much child maintenance the Applicant should have paid this year and should be paying in the future the Court must first determine what his income is for child maintenance purposes. [ 37 ] The Child Maintenance Guidelines provide the rules for the calculation of income for child maintenance purposes in sections 16 to 20. [ 38 ] There appears to be little dispute that in 2010 the Applicant's income has thus far been comprised of actual dividends totalling

$24,300.00 paid to him by J.D.W. and employment income (as a temporary employee) of $61,650.00 for a total income of $85,950.00 per year. He does not expect any further income this year. [ 39 ] The Court should strive to come up with the fairest determination of the payor's income available for child maintenance purposes before determining the level of child maintenance. Generally the Court looks to what would be on line 150 of the T1 General form issued by Canada Revenue Agency which, for tax purposes, is the payor's total income. However,

section 18 of the Guidelines provides that where the payor is a shareholder, director or officer of a corporation and the Court is of the opinion that the amount of annual income as determined under

section 16 does not fairly reflect all of the income available to the payor for the payment of child maintenance then the Court could determine the payor's annual income to include among other things all or part of the pre-tax income of the corporation. I am not prepared to impute any portion of J.D.W.’s pre-tax income to the Applicant. J.D.W.’s 2009 Balance Sheet discloses very little cash as of the end of the year and less than what J.D.W. is owed to J.D.W. by the Applicant by way of a shareholders’ loan.

Also, J.D.W. paid the Applicant in 2009 more in dividends than it produced in net income by reducing its Retained Earnings. In other words J.D.W. in 2009 paid the Applicant all it reasonably could. I’ve been given no reason to believe 2010 was any different. [ 40 ] I have also been urged on behalf of the Respondent to look carefully at the expenses of J.D.W. and determine whether any of those expenses should be added back into the income of the Applicant. In other words are any of those expenses really personal expenses that effectively are personal income of the Applicant in disguise.

One difficulty I have is that in 2010 I do not have up-to-date financial statements of J.D.W. which is not surprising since the year is not yet over. However, I have been given little or no evidence from the Respondent that would cause me to believe that any of the expenses of J.D.W. are anything other than legitimate business expenses. The cross- examination of the Applicant concerning the expenses of J.D.W. may have caused me to believe differently but that was not the case.

I therefore do not feel that I am able nor do I feel compelled to add back into the Applicant's income any expenses that may have been claimed by J.D.W. in 2010. [ 41 ] Section 19 (1)(

h) of the Guidelines does however provide me with the discretion to impute additional income to the Applicant if I conclude that he received a significant portion of his income from dividends. Dividends receive favourable tax treatment and section 19 (1)(

h) was included in the Guidelines so the Court can take into account that advantage and take steps to put the payor on par (for child maintenance purposes) with an employee that would have the same income available for child maintenance purposes. [ 42 ] In 2010, of the Applicant's total income of $85,950.00 he received, $24,300.00 was in the form of dividends.

I consider 28% of his total income to be a significant portion and I therefore believe it is appropriate to impute additional income to the Applicant. [ 43 ] Ignoring deductions that would be particular to the Applicant but taking into account only those credits and deductions that are available to each tax payor, the Applicant's tax payable in 2010 (assuming dividend income of $24,300.00 and employment income of $61,650.00) comes to $20,761.00 leaving him with a net after-tax income figure of $65,189.00.

I have calculated that a tax payor whose income is comprised solely of employment income would have to earn $92,575.00 in order to be left with the same net after-tax income. I arrived at that figure by calculating what would have been the tax payable by the Applicant if his income was all in the form of employment income ($24,558.00), and subtracting from that his actual tax payable ($20,761.00) and multiplying the difference ($3,797.00) by the reciprocal of the marginal tax bracket at that level of employment income (i.e. the reciprocal of 43%, being 57%) thereby arriving at the figure of $6,661.00.

I then added that to his total income of $85,950.00 to arrive at a new income figure of $92,611.00. I then adjusted that figure through trial and error until I was able to arrive at the same net after tax income as is produced by the Applicant's actual income using Canada Revenue Agency's 2010 tax figures. I am prepared to impute to the Applicant an income in the year 2010 of $92,575.00 because of the significant amount of dividend income he received this year.

I can find no further justification for imputing any additional income to him. [ 44 ] In 2010 it is my understanding that from January to November inclusive the Applicant paid total child maintenance of $10,891.00 being comprised of the following payments: January $ 962.00 February 1,107.00 March 1,179.00 April 1,179.00

April 1,179.00 May 1,179.00 June 877.00 July 877.00 August 877.00 September 877.00 October 877.00 November 900.00 [ 45 ] His monthly payments varied because of his ongoing recalculation of what he was estimating to be his annual income by the end of 2010. On his behalf it was argued that he should not be ordered to pay any retroactive child maintenance for 2010 because it was open to the Respondent to complain if she felt that the child maintenance was insufficient.

The trouble with that argument is that she would not have any way of knowing that the child maintenance was insufficient until she knew what the Applicant's total income for the year would be. Assuming an income of $92,575.00 the Applicant should have paid monthly child maintenance of $1,257.00 or a total of $13,827.00 for the months of January to November inclusive. I therefore order the Applicant to pay the difference of $2,936.00 (being the short-fall of the child maintenance that he was to pay in the year 2010) to the Respondent forthwith.

He is also to pay to her child maintenance for the month of December in the sum of $1,257.00 which is to be paid no later than December 1, 2010. [ 46 ] It is the Applicant's evidence that he will be winding down J.D.W. and that his plan is to work as a temporary employee in the future such that his income will all be in the form of employment income as opposed to dividends. He also estimates (because at this point in time it is the best that he can do) that his income will be in the range of $75,000.00 to $85,000.00 per year.

Having considered his actual income earned over the past three years I believe a fair estimate of his income on a go forward basis is $85,000.00.

Therefore assuming his income is in the form of employment income and no dividend income, commencing January 1, 2011 and continuing on the first day of each and every month thereafter I order that the Applicant pay to the Respondent child maintenance for the two children in the sum of $1,166.00 per month being the Nova Scotia table amount for an employee earning $85,000.00 per year. [ 47 ] My order will contain the usual provision requiring the Applicant to provide the Respondent with a copy of his income tax return and notice of assessment or reassessment as the case may be no later than June 1 each year commencing with his 2010 tax information which will be supplied no later than June 1, 2011.

In the event that the Applicant does not wind down J.D.W. or in the event that he incorporates another company from which he receives dividends, he is also to provide the Respondent with copies of his corporate financial statements and corporate tax return at the same time. [ 48 ] In future years when recalculating the amount of child maintenance payable it is my suggestion that should the Applicant continue to receive a portion of his income in the form of dividends that the parties simply look to the total income figure on line 150 of his tax return. Although

section 5 of

Schedule III of the Guidelines provides that the Court must replace the taxable amount of dividends that appear on line 120 of the tax payor's return with the actual amount of dividends received, the Court always has the discretion under section 19 (1)(

h) to impute additional income to the tax payor if a significant portion of his or her income is received in the form of dividends. If the Court exercises that discretion the Court should inevitably end up with a total income figure virtually the same as the tax payor's total income on line 150 before the

Schedule III adjustment was made. That is merely my suggestion. It is not a condition that can in any way restrict the discretion of a Court reviewing child maintenance in future years and there may be other considerations that come into play. SPOUSAL SUPPORT [ 49 ] The Respondent also seeks spousal maintenance. It is her evidence that during the years the parties were together she was a stay at home parent and the Applicant was the income earner. Their relationship was traditional in nature.

She has been out of the work force since their oldest child was born and it cannot be reasonably expected of her that she re-enter the work force seamlessly and be able to support herself without any assistance from the Applicant. The Applicant on the other hand believes that whereas the parties have been separated for at least three years that she has had ample opportunity to take whatever steps are necessary in order to re-enter the work force and that she hasn't done enough in that regard.

[ 50 ] At the present time the Respondent works on average eight hours per week and earns minimum wage which at this time in Nova Scotia is $9.65 per hour, giving her an annual income of approximately $4,000.00. [ 51 ] The children are the only dependents of the two parties. Neither lives with a new partner. [ 52 ] The governing legislation is found in sections 3 , 4 and 5 of the Maintenance and Custody Act . Counsel for the Respondent also referred me to various case authorities including Bracklow v. Bracklow, 1999 CanLII 715 (SCC) , [1999] 1 S.C.R. 420 and Moge v.

Moge, 1992 CanLII 25 (SCC) , [1992] 3 S.C.R. 813 . [ 53 ] I am satisfied that the Respondent has established an entitlement to spousal maintenance. Because of the traditional nature of the parties' relationship during their period of cohabitation she relied on the Applicant for financial support and her dependency did not end when their relationship terminated.

In fact, because of the length of time she has been out of the workforce and because of her obligations to the children her dependency has continued and will likely continue for the immediate future. [ 54 ] In arriving at the spousal maintenance to be paid by the Applicant I have considered the following: 1. The provisions of the Maintenance and Custody Act and in particular sections 3, 4 and 5 of that statute. 2. The Statements of Income and Expenses of both parties as well as their evidence regarding their financial circumstances as found in their affidavits and their testimony. 3.

The child maintenance that I have already ordered. 4. The tax consequences to both parties of a spousal maintenance order including but not restricted to the refundable credits received or to be received by the Respondent. 5. What I consider to be the reasonable needs of both parties and the children. 6.

What would have been the result if I had strictly applied the Spousal Support Advisory Guidelines. [ 55 ] I order that commencing January 1, 2011 and continuing on the 1st day of each and every month thereafter until otherwise ordered the Applicant will pay to the Respondent spousal maintenance in the sum of $1,000.00 per month. [ 56 ] The Respondent has an obligation to try to support herself. She is only 41 years of age. She is intelligent. She may need retraining. That is for her to decide.

I appreciate that she has two children to care for and although Rebecca may have high needs they are not such that would prevent the Respondent from retraining or going back to work. Therefore, while I'm not prepared to order a termination date I will order that there will be a review of the spousal maintenance provisions of my order to take place at the initiation of either party in approximately two years time.

That review does not prevent an earlier application to vary the provisions of this order should there be an unforeseen material change in circumstances that would warrant a variation. [ 57 ] At the review the Respondent will be expected to demonstrate to the Court that she has either taken steps toward retraining or has made reasonable efforts to secure employment along with the details of all of her efforts. She is forewarned that should she fail to take reasonable steps to try to achieve self-sufficiency within a reasonable period of time her failure to take those steps might be seen by

the Court as a change in circumstance that would warrant a variation of my order. She should start to formulate a plan without delay. [ 58 ] Counsel for the Applicant will prepare the necessary order. J.