Mitchell v. MacLeod, 2022 NSSC 217

Supreme Court of Nova Scotia (FAMILY DIVISION) Citation: Mitchell v. MacLeod, 2022 NSSC 217 Date: 20220802 Docket: 1203-004161 Registry: Bridgewater Between: Shandi Marie Mitchell Petitioner v. Alan Philip MacLeod Respondent Library Heading Judge: The Honourable Associate Chief Justice Lawrence I. O’Neil Heard: May 4, 2022 at Bridgewater, Nova Scotia Issue: Whether Mr. MacLeod had an interest in the literary works of Ms. Mitchell

Summary: Mr. MacLeod claimed an interest in works authored by Ms. Mitchell, his spouse. The Court found the works were business assets in the name of Ms. Mitchell and Mr. MacLeod had no interest in the works. Keywords: Intellectual property; business asset; valuation date Legislation: Divorce Act , R.S.C. 1985 c.3 Matrimonial Property Act , R.S.C. 275 Cases Considered: Tibbetts v. Tibbetts, 1992 CarswellNS 85 (CA) L.(J.W.) v. M.(D.B.) 2008 NSSC 215 Volcko v. Volcko , 2013 NSSC 342 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 Citation: Mitchell v. MacLeod, 2022 NSSC 217 Date: 20220802 Docket: 1203-004161 Registry: Bridgewater Between: Shandi Marie Mitchell Petitioner and

Alan Philip MacLeod Respondent Judge: Associate Chief Justice Lawrence I. O’Neil Heard: May 4, 2022 in Bridgewater, Nova Scotia Counsel: Kim Johnson, Counsel for Shandi Mitchell Cassandra Armsworthy, Counsel for Alan MacLeod Overview [ 1 ] The parties married September 2, 1995 and agree they separated on September 25, 2017. They cohabited for an unspecified number of years before marriage. They do not have dependent children. [ 2 ] Ms. Mitchell filed a Petition for Divorce on December 20, 2018. Mr. MacLeod filed an Answer on February 27, 2019.

Each waives any claim for spousal support. [ 3 ] They settled most property issues. The “ownership” of certain intellectual property claimed by Ms. Mitchell is at issue as is the valuation of each party’s interest in retirement and savings accounts currently and formerly held in the name of Mr. MacLeod. [ 4 ] The intellectual property is of unknown but modest commercial value. The RRSPs and TFSA accounts have a total undivided value of less than $70,000. [ 5 ] The parties describe themselves as artists. Ms. Mitchell describes herself as an author and director/filmmaker. She describes Mr.

MacLeod as a songwriter and a successful film industry key creative artist (exhibit 2, paragraph 5 and 6). Divorce [ 6 ] I am satisfied the parties were married, the jurisdiction of the Court is established, there are no bars to the issuance of an order divorcing the parties. A Divorce Order will therefore issue ( s.3 , s.8 and s.11 Divorce Act , R.S.C. 1985 c.3). Intellectual Property [ 7 ] Ms. Mitchell achieved some financial success with her writing during her career.

Prior to 2009 she operated two sole proprietorships, Talisman Productions (1991-1994) and Talisman Films (1995-2009) and she later incorporated Talisman Productions Inc. The incorporation of a small enterprise was motivated by a desire to better manage her business and coincided with the success of a novel. [ 8 ] The corporation’s structure was changed in 2009 when two classes of shares were created. At that time, Mr. MacLeod was given 250 Class ‘B’ non-voting shares. Ms. Mitchell was given the same Class ‘B’ non-voting shares. Ms.

Mitchell, however, remained the only holder of Class ‘A’ shares and in control of the corporation. Mr. MacLeod testified that he only became aware he was not an equal owner in all respects of this corporation when he received copies of the corporate documents as required by this litigation.

[ 9 ] Exhibit 7 is one of two affidavits filed by Mr. MacLeod in this proceeding. Paragraph 37 of exhibit 7 describes the claim of Mr. MacLeod to identified intellectual property: 37. Shandi and I collaborated on novels, novellas, film and television projects, scripts, pitches, poems, songs, and short stories during our marriage. Attached as Exhibit “F” is a list of the intellectual property acquired, created, developed, and completed by us during our creative partnership and marriage. [ 10 ] He provided a list of written products in which he says he has an interest. [ 11 ] The list has two columns.

One is entitled “novels, novellas, film or television projects, scripts, pitches or future TBD media projects”. The second column is entitled “poems, short stories, children’s projects, future TBD media projects”. [ 12 ] In response to Mr. MacLeod’s claims for an equal or any ownership in creations she was involved in, Ms. Mitchell says simply that any contribution to these works he made was credited to him and he was paid for his contribution. I find this statement to be supported by the evidence. [ 13 ] Ms.

Mitchell acknowledges that over the years they talked about projects and she welcomed his input, but she says he was not in any way a co-creator and neither saw it that way. [ 14 ] Ms. Mitchell said they lived together, shared an interest in each other’s artistic pursuits and supported each other. She says she personally owns all the intellectual property rights for her work. She says even her corporation does not own the works (exhibit 2, paragraph 11). [ 15 ] Each party says whatever income they earned made it into the family and they shared their earnings.

They agree and the evidence establishes this couple had very modest earnings over the decades, often dipping into whatever savings or retirement funds existed to meet ongoing expenses. [ 16 ] The Court is satisfied that even as these parties separated, they professed love and care for each other. They were saddened to have reached the conclusion that they should separate. As witnesses years later, it is clear they have no bitterness toward one another. [ 17 ] They remember aspects of their creative relationship quite differently. I do not believe either party is being dishonest.

The evidence does not permit that conclusion. Clearly, then reliability is a concern given the parties different description of their contributions to the creative works of the other. [ 18 ] The Court is called upon to decide whether the evidence presented establishes which version of their creative and personal history is correct. [ 19 ] I am satisfied the intellectual creations forming the basis of Mr. MacLeod’s claim are business assets as defined by s.2(

a) of the Matrimonial Property Act , R.S.C. 275. They are also her personal property and not that of the corporation she established. [ 20 ] This personal property was used and held for an income producing purpose. As such, these works are not matrimonial assets (s.4(1)(e); as confirmed in Tibbetts v. Tibbetts , 1992 CarswellNS 85 (CA) ; L.(J.W.) v. M.(D.B.) 2008 NSSC 215 ; Volcko v. Volcko , 2013 NSSC 342 . These assets were not passive. They were not held for retirement. [ 21 ] I do not find a contribution to the creation of any of these works which would result in Mr. MacLeod having an ownership interest in them.

[ 22 ] I am satisfied Mr. MacLeod was a supportive partner to Ms. Mitchell and undoubtedly helped her to be creative as one might expect a loving and supportive spouse/partner to be. I do not find these parties contemplated each having an ownership interest in creative products of the other. [ 23 ] Mr. MacLeod’s

interpretation of their relationship dynamics is not consistent with his inability to detail specifics of his contributions. He was unable to specify his contributions to the many works he implicitly attributes to be primarily those of Ms. Mitchell. He had no records or details of what he did to help create any of these works. [ 24 ] Clearly, he has an exaggerated view of his role in the work of Ms. Mitchell. In contrast, he created very little, if any, intellectual property. The sole proprietorship he registered for his endeavours appears to have no assets or business activity or history. [ 25 ] Mr.

MacLeod refused to back away from his claim for a 50% interest in these creations even when confronted with evidence that he worked out of Province and at other times away from home for months while Ms. Mitchell worked each day on the many creative works he claims an interest in. [ 26 ] For the foregoing reasons, Mr. MacLeod does not have an interest in the business asset, i.e., the intellectual property of Ms.

Mitchell as claimed by s.18 of the Matrimonial Property Act and there is no basis for an unequal division of the matrimonial property as authorized by s.13 of the Matrimonial Property Act . [ 27 ] I find the corporate shares are assets of the parties in the proportion and nature shown on the record of share ownership for the corporation, Talisman Productions Inc.

The RRSPs and TFSA [ 28 ] An assessment of the parties’ views concerning their transition to independent lives following separation must reflect the fact this couple remained in love and continued to harbour a significant level of caring for each other and remained mutually supportive after their separation. [ 29 ] I accept that a pattern of accessing RRSPs and TFSA funds in Mr. MacLeod’s name prior to separation continued after the parties separated with the agreement and consent of both parties.

This continued until late December 2017. [ 30 ] Notwithstanding the parties accept September 25, 2017 as the date of separation, I am satisfied they agreed that the division of jointly owned assets and joint liabilities would be sometime later. This reflected the parties’ desire for an amicable separation and a desire to assist the other to achieve financial independence. [ 31 ] Similarly, during the post separation period, Ms. Mitchell continued to live in the matrimonial home until September 2018 with the support of Mr. MacLeod. Mr.

MacLeod paid one half the expenses associated with the home during this period until the home was vacated by Ms. Mitchell. He was aware she could not cover these expenses by herself. Mr. MacLeod remained in Toronto after separation and did not return to the home. [ 32 ] The date of separation is the usual valuation date for assets whose value fluctuates, such as RRSPs and TFSAs, with values adjusted upwards or downwards to reflect changes in values to the time of division. Post separation contributions are exempt from this calculation as per s.41(1)(

g) of the Matrimonial Property Act . [ 33 ] I am satisfied the expenditures from the RRSP and TFSA accounts made after separation to December 2017 were consistent with the parties’ plan to amicably separate and to share the costs associated with that objective. The valuation date for the remaining RRSPs and TFSA is therefore December 2017. The parties will sign any necessary banking documents to equally divide the December 2017 balances.

[ 34 ] As observed, this sharing of post-separation expenses is consistent with the parties’ decision to share the household carrying costs equally until it sold almost one year after separation. [ 35 ] The claim of Mr. MacLeod for an interest in any of the creative works of Ms. Mitchell is dismissed. [ 36 ] Parties are asked to forward any submission on costs on or before the last business day of August 2022. ACJ