Pellicer v. Williams, 2012 NSSC 267

SUPREME COURT OF NOVA SCOTIA Citation: Pellicer v. Williams, 2012 NSSC 267 Date: 20120716 Docket: 1201-063597 Registry: Halifax Between: Rocio (Williams) Pellicer Applicant and Paul Edward Williams Respondent Judge: Associate Chief Justice Lawrence I. O ’ Neil Date of Hearing: June 20, 2012 Counsel: Janet M. Stevenson, counsel for the Applicant Paul E. Williams, Self Represented By the Court : Introduction [ 1 ] The parties were married March 29, 2003 in Toronto and separated in May 2009. They were divorced April 1, 2011 in Halifax.

They have two children, born in […] 2003 and […] 2006. [ 2 ] An early interim consent order directed that primary care of the children would rest with Ms. Pellicer and provided for parenting time for Mr. Williams. That order, dated December 29, 2009, stated Mr. Williams ’ income was unemployment insurance and set child support at $342. [ 3 ] A partial consent Corollary Relief Order ( ‘ CRO ’ ) issued March 1, 2011. It states “ Paul Williams is establishing his own business and is found to have an annual income of $22,600". Child support payable by Mr. Williams was set at $331.

The issues of custody and access were deferred by the 2011 order to a later hearing. [ 4 ] Mr. Williams later sought shared parenting and adjudication of the parenting issue. That application was heard by me on

October 25, 2011; a decision was rendered October 27, 2011. I ruled that it was in the best interests of the children to remain primarily in Ms. Pellicer ’ s care with significant parenting time for Mr. Williams. A review of the child support obligation of Mr. Williams and the requirement for him to contribute to the special expenses of the children was adjourned for a later review. This decision follows that review on June 20, 2012. Issues [ 5 ] Pre-trial memorandums dated December 19, 2011; February 1, 2012 and May 8, 2012 contain the Court ’ s directions to the parties in preparation for the review.

The May 8, 2012 memorandum identified the issues for adjudication on June 20, 2012: The issues for the Court's consideration are (1) a determination of Mr. Williams' annual income for the purpose of determining the table amount of child support; (2) the ongoing child support obligation of Mr. Williams. This includes consideration of any imputed income. Mr. Williams' anticipated undue hardship application is adjourned to a future date if it is necessary that it be heard. [ 6 ] The parties ’ obligation to contribute to special expenses of the children was also an issue addressed by the parties.

The Hearing [ 7 ] The hearing proceeded before me on June 20, 2012. [ 8 ] Mr. Williams and Ms. Pellicer were the only witnesses. [ 9 ] Ms. Pellicer confirmed that her home cleaning business employs four other persons. She receives only $300 per month from the business. She is changing her business organization. In September 2012, she will be serving the same number of customers and have one employee. This business reorganization will result in an annual income for her in the $15-$20,000 range. [ 10 ] She seeks the table amount of child support from Mr.

Williams and the payment by him of one half of the cost of the after school ‘ excel ’ program for the children ($199.50/month during the school year). [ 11 ] She asks that the Court impute an income of $30,000 to Mr. Williams. She argues that Mr. Williams is well educated in the technology sector and should be able to find work in that sector. She also argues that even if he can not obtain work in the area of his training, he should accept lower paying, even minimum wage employment. She describes herself as “ cleaning toilets ” for a living and to support her children. She challenges Mr.

Williams to be as committed to working. [ 12 ] Ms. Stevenson, on behalf of Ms. Pellicer, argued that Mr. Williams is pursuing an unrealistic plan to be self employed in the technology sector; that he has been doing so long enough and that he is under a duty to seek and to accept other employment. She argued that Mr. Williams ’ business, IT Essentials, must be discontinued given that it has not succeeded. [ 13 ] Exhibit #11 is a Case Manager ’ s Statement, dated September 14, 2010. It contains a commentary on Mr. Williams ’ job prospects and his return to work action plan i.e. to start an IT business. [ 14 ] Mr.

Williams offered Exhibits #8 (paragraph 4) and #12 to explain his business endeavour and to explain his efforts to find employment and/or clients. He went to great lengths to explain that in his opinion, the probation order he was made subject to after assaulting Ms. Pellicer in 2009, has made his gaining employment very difficult. He testified that his efforts to achieve employment and clients for his business have been frustrated by the fact of his criminal conviction.

[ 15 ] Mr. Williams was very apologetic and made no excuses for his conduct that resulted in the charge. I accept his statements on this issue as genuine. [ 16 ] The Province of Nova Scotia has a program that provides persons with start up funds and support. Ms. Pellicer relied upon this support to start her cleaning business. Mr. Williams also relied upon this program. It is important to accord to Mr. Williams the same opportunity to develop a business that Ms. Pellicer accords herself. Like Mr. Williams, she participated in a program to encourage persons to become self employed and self supporting. [ 17 ] Mr.

Williams testified that he is without any income. He wants the child support obligation set at zero and argues that he should not be ordered to make a contribution to any special expenses for the children. He says he has drawn on his line of credit since December 2011, that he is approaching his credit limit of $20,000 and his living costs have been met by borrowing from his line of credit. [ 18 ] He also testified that he has nevertheless been paying child support and making his contribution to the ‘ excel ’ program as ordered.

He says funds to meet these obligations have been borrowed from his line of credit. [ 19 ] Exhibit #5 has an attachment; it is a chronological listing of Mr. Williams employment efforts from February 2, 2012 to June 8, 2012 inclusive. Mr. Williams gave oral evidence of his job search efforts after June 8 to the day of the hearing. As referenced supra at paragraph 8, exhibit 8 contains similar information for the period January 2011 - November 2012. [ 20 ] In addition, Mr.

Williams filed, as attachments to Exhibit #5, a series of e-mails confirming his job search communication directed at a range of companies including Eastlink, PQA, Lockheed Martin and Archway Search Consultants. Imputing Income [ 21 ] I am satisfied that Mr. Williams does not have an income earned or from another source. I must determine whether an income should be imputed to him. Ms. Stevenson, on behalf of Ms. Pellicer, on January 30, 2012, filed a brief in support of imputing income of $30,000 to Mr. Williams on the basis of a s.19(1) (

a) of the Federal Child Support Guidelines, SOR/97-175 as amended. [ 22 ] The Federal Child Support Guidelines , at section 19(1) (

a) provide: Imputing Income 19.

(1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following: (

a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse; [ 23 ] Justice Forgeron, in a recent decision, thoroughly reviewed case law on the meaning, effect and application of

Section 19 of the Child Support Guidelines . For convenience, I reproduce the following from her decision in MacDonald v. Pink , 2011 NSSC 421 : [ 24 ]

Section 19 of the Guidelines provides the court with the discretion to impute income in specified circumstances. The following principles are distilled from case law:

a. The discretionary authority found in sec. 19 must be exercised judicially, and in accordance with rules of reasons and justice, notarbitrarily. A rational and solid evidentiary foundation, grounded in fairness and reasonableness, must be shown before a court canimpute income: Coadic v. Coadic 2005 NSSC 291. b. The goal of imputation is to arrive at a fair estimate of income, not to arbitrarily punish the payor: Staples v. Callender, 2010 NSCA49. c.

The burden of establishing that income should be imputed rests upon the party making the claim, however, the evidentiary burdenshifts if the payor asserts that his/her income has been reduced or his/her income earning capacity is compromised by ill health:MacDonald v. MacDonald, 2010 NSCA 34; MacGillivary v. Ross, 2008 NSSC 339. d. The court is not restricted to actual income earned, but rather, may look to income earning capacity, having regard to subjective factorssuch as the payor's age, health, education, skills, employment history, and other relevant factors.

The court must also look to objectivefactors in determining what is reasonable and fair in the circumstances: Smith v. Helppi 2011 NSCA 65; Van Gool v. Van Gool, (BC CA), [1998] 113 B.C.A.C. 200; Hanson v. Hanson, (BC SC), [1999] B.C.J. No. 2532 (S.C.);Saunders-Roberts v. Roberts, 2002 NWTSC 11; and Duffy v. Duffy, 2009 NLCA 48. e. A party's decision to remain in an unremunerative employment situation, may entitle a court to impute income where the party has agreater income earning capacity. A party cannot avoid support obligations by a self-induced reduction in income: Duffy v. Duffy, supra;and Marshall v.

Marshall, 2008 NSSC 11 , 2008 NSSC 11. [25] In Smith v. Helppi 2011 NSCA 65, Oland J.A. confirmed the factors to be balanced when assessing income earning capacity atpara. 16, wherein she quotes from the decision of Wilson J. in Gould v. Julian 2010 NSSC 123. Oland J.A. states as follows: 16 Mr. Smith argues that the judge erred in imputing income as he did. What a judge is to consider in doing so was summarized in Gouldv. Julian, 2010 NSSC 123 (N.S. S.C.), where Justice Darryl W.

Wilson stated: Factors which should be considered when assessing a parent's capacity to earn an income were succinctly stated by Madam JusticeMartinson of the British Columbia Supreme Court, in Hanson v. Hanson, (BC SC), [1999] B.C.J. No. 2532, asfollows: 1. There is a duty to seek employment in a case where a parent is healthy and there is no reason why the parent cannot work. It is "noanswer for a person liable to support a child to say he is unemployed and does not intend to seek work or that his potential to earn incomeis an irrelevant factor". ... 2.

When imputing income on the basis of intentional under-employment, a court must consider what is reasonable under thecircumstances. The age, education, experience, skills and health of the parent are factors to be considered in addition to such matters asavailability to work, freedom to relocate and other obligations. 3. A parent's limited work experience and job skills do not justify a failure to pursue employment that does not require significant skills,or employment in which the necessary skills can be learned on the job.

While this may mean that job availability will be at a lower end ofthe wage scale, courts have never sanctioned the refusal of a parent to take reasonable steps to support his or her children simply becausethe parent cannot obtain interesting or highly paid employment. 4. Persistence in unremunerative employment may entitle the court to impute income. 5. A parent cannot be excused from his or her child support obligations in furtherance of unrealistic or unproductive career aspirations.

6. As a general rule, a parent cannot avoid child support obligations by a self-induced reduction of income. . . . . . [33] In Nova Scotia, the test to be applied in determining whether a person is intentionally under-employed or unemployed is reasonableness, which does not require proof of a specific intention to undermine or avoid child maintenance obligations. [ 26 ] In Gill v. Hurst 2011 NSCA 100 , Bryson J.A. affirmed the trial judge’s decision to impute income where the father’s attempt to justify his underemployment for health and educational reasons was rejected: paras. 30 and 31.

In addition, Bryson J. held that the trial judge made no error by imputing the “modest sum” of $25,000 to the father. - application to the facts herein [24] Ms. Pellicer has the onus of establishing that income should be imputed to Mr. Williams. This she must do on a balance of probabilities. [25] Mr. Williams is in good health as far as the Court is aware. He is in his late thirties, a productive period of one ’ s life.

The Court was not informed of any physical, emotional or psychological impediment to his being able to work in a professional environment, the service sector or as one employed to do manual work. [26] He has a college level education, having been trained in the technology sector. In addition, he has years of work experience in the technology industry. I conclude from his evidence that he has an ability to work in this sector, and that this is a credential that enhances his employability in other contexts. [ 27 ] Mr. Williams has time to search for and to obtain employment.

He will meet people well and communicate in a respectful, intelligent manner. He was appropriately dressed and groomed for Court and I infer understands the value of his appearance when meeting others and when seeking employment. [ 28 ] Mr. Williams has pursued his web business for three years. The initial order dealing with child support recognized this initiative on his part. It was a consent order. In my view, given his prior work history and his earning potential, had the business succeeded, this was a reasonable decision.

Assumptions and optimism that formed the basis of that conclusion and the related order have been disproven. [ 29 ] To date, in 2012 Mr. Williams earned $45. In 2011 he earned $1,500 and received $12,180 as employment insurance income. He must generate an income to support himself and his children. The pendulum has swung against his continuing to pursue the web business he started. [ 30 ] Objectively, as noted above, he has numerous attributes that make him an attractive employee. [ 31 ] He describes his criminal conviction for assaulting his wife in 2009 as if it is a bar to any employment.

I accept it may be a bar to some employment but it is not the barrier he suggests. I do not accept that he is unable to find employment of any kind. [ 32 ] His responses to questioning by Ms. Stevenson on the issue of his job searches and an examination of Exhibits #5, #8 and #15, his list of employer contacts, reinforces the conclusion that he has been networking with a view to building a client base. Minimal efforts have been expended on actually applying for work. His decisions in this respect are no longer reasonable. [ 33 ] Exhibit #16 contains summaries of Mr.

Williams income in recent years as determined by the Canada Revenue Agency:

2011 total income $11,012 (E.I. benefits $12,180, total earnings ($667), commission income ($582) 2010 total income $34,544 (E.I. benefits $19,413, commission income $4,903, total earnings $7,955) 2009 total income $40,891 (E.I. benefits $14,304, RRSP income $1,164, total earnings $25,423) 2008 the consent order herein set his income at approximately $80,000 [ 34 ] Mr. Williams is without an income. He must be prepared to take any job, given his unsuccessful job search and business experience since 2009.

This is an obligation made pressing by his obligation to contribute to the support of his two children. [ 35 ] In contrast, Ms. Pellicer recognizes her business model is not succeeding. She is reducing her number of employees and will be doing house cleaning, previously done by her employees. Her response to her situation is realistic and will result in an income for her in the $15 - $20,000 range, an increase from $300/month. [ 36 ] In Staples v.

Callender , 2010 NSCA 49 , Bateman, J.A. stated: [21] The purpose of imputing income, in the absence of proper disclosure, is to arrive at a fair estimate of income where information is not otherwise available, not to arbitrarily punish the payor for lack of disclosure. In this regard each case must be decided in context. There will be circumstances where a judge concludes that the non-disclosure speaks of a payor attempting to avoid his or her obligations by hiding the true income information. In view of Mr.

Callender’s limited work history, relatively low income, provision of year to date figures and recent pay stubs, and apparently truthful testimony about his 2008 income, the judge could reasonably infer that he was not motivated to hide income. [ 37 ] I am satisfied on a balance of probabilities that Mr. Williams ’ lack of an income is a result of his “ persistence in unremunerative employment ” and “ unrealistic or unproductive career aspirations ” ( Smith v. Helppi , 2011 NSCA 65 , Oland, J.A. at paragraph 16). [ 38 ] Having concluded that income should be imputed to Mr.

Williams, I must decide what that level of income should be. [ 39 ] The Nova Scotia minimum wage is $10.15 per hour. Based on fifty weeks of work each year and forty hours each week, one would earn slightly more than $20,000 per year at this rate. [ 40 ] Mr. Williams is capable of earning more than the minimum wage given his credentials and personal attributes. [ 41 ] I am satisfied that a fair level of income to impute is $25,000, reflecting an hourly rate of $12.50. [ 42 ] On or before the 7 th day of each month, Mr. Williams is directed to provide to Ms. Pellicer or her counsel, a

summary of his earnings over the preceding month, whether yet received. On or before this date, he is also directed to provide a

summary of his efforts to find employment over the preceding month. [ 43 ] Mr. Williams ’ child support obligation is set as $363 effective August1, 2012 , based on the child support tables.

- special expenses [ 44 ] The Federal Child Support Guidelines , at s.7(1) (

a) provide that I may order an amount to cover all or any portion of certain child care expenses; after considering inter alia the necessity of the expense in relation to the child(ren) ’ s best interest and the reasonableness of the expense in relation to the means of the parents. [ 45 ] The test of section 7(1)(

a) is as follows: 7.

(1) In a child support order the court may, on either spouse’s request, provide for an amount to cover all or any portion of the following expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child’s best interests and the reasonableness of the expense in relation to the means of the spouses and those of the child and to the family’s spending pattern prior to the separation: (

a) child care expenses incurred as a result of the custodial parent’s employment, illness, disability or education or training for employment; [ 46 ] The Court has been told that the expense to which Mr. Williams is being asked to contribute is one that is necessary - it is pre and after school care for the children. This service frees up the parties to work or to seek employment. I view this expense as necessary. [ 47 ] These parents have a very modest income. This expense is borderline in terms of whether it is more than either can afford, given Ms. Pellicer ’ s actual income and Mr.

Williams imputed income. [ 48 ] Ms. Pellicer is agreeing to pay half the expense. Mr. Williams is ordered to pay 50% of the monthly cost of the child care service, up to a maximum of $100 in a calendar month (September - June inclusive). Ms. Pellicer must provide receipts confirming that the expense has been incurred. Mr. Williams must pay Ms. Pellicer or her designate within one week of receiving a receipt confirming payment of the expense. ACJ