Swan v. Leslie, 2011 ONSC 6879

CITATION: Swan v. Leslie, 2011 ONSC 6879 COURT FILE NO.: 27011/0 DATE: 2010-11-21 ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: ) ) JENNIFER SWAN ) ) ) Steven Foster , for the Applicant ) Applicant ) ) ) - and - ) ) ) DAVID LESLIE ) ) ) Self-Represented ) Respondent ) ) ) )) HEARD: April 5, 2011, at Milton, Ontario Price J. Reasons For Order NATURE OF MOTION [ 1 ] During the course of a four and a half year common law relationship from September 2005 to March 21, 2009, Jennifer Swan struggled under a disproportionate burden of responsibility for debts that she and David Leslie brought into their relationship.

Mr. Leslie, although earning a higher income than Ms. Swan both from his employment as a firefighter and his side employment as a home renovator, failed by reason of both his dependence on alcohol and irresponsible buying, to assume his share of responsibility for their debts and eventually declared bankruptcy, leaving Ms. Swan to assume their joint debt after they separated. [ 2 ] Ms. Swan now moves for

summary judgment for spousal support from Mr. Leslie to enable herself to discharge their former debts. She seeks orders:

a) An order directing Mr. Leslie to pay lump sum support of $2,886.63 to reimburse Ms. Swan for money spent to retire their joint debt to TD Canada Trust for an overdraft loan on their joint account no. 0471-6246860 at that Bank.

b) An order directing Mr. Leslie to pay spousal support in the amount of $1,000.00 per month to Ms. Swan to be applied to repay her credit line no. 01672-3241716-001 with RBC Royal Bank and credit line No. 3270492 with TD Canada Trust until the credit lines are re- paid in full.

c) Alternatively, an order directing Mr. Leslie to pay to RBC Royal Bank and TD Canada Trust on account of spousal support the sum of $1,000.00 per month to be applied to pay the outstanding balance on the above mentioned credit line accounts until they are re-paid in full.

d) An order directing that both of the above-mentioned credit lines be closed once the balance is paid and that the parties be prohibited from drawing on the accounts while they remain open.

e) An order directing Mr. Leslie to indemnify Ms. Swan from any claims arising by virtue of the balance owing on the above- mentioned accounts;

f) An order declaring that the above-mentioned payments not be treated as periodic support payments within the meaning of the Income Tax Act so that the payments shall not be deductible as income by Mr. Leslie or taxable to Ms. Swan for income tax purposes and, in the event that they are taxable, that the said support be increased to compensate Ms. Swan for the taxes. [ 3 ] At the hearing of Ms. Swan’s motion on April 5, 2011, I ordered that Mr. Leslie pay to Ms.

Swan, commencing May 1, 2011, and on the 1 st and 15 th of every month thereafter, spousal support in the amount of $ 500.00 for a period 53 months provided that, if by May 1, 2011, Mr. Leslie delivered to Ms. Swan’s solicitor a lump sum of $25,000.00, in which case his spousal support obligation would end. [ 4 ] I was notified by Ms. Swan’s counsel on May 2n 2011, that Mr. Leslie had failed to deliver the lump sum payment. Accordingly, these are my reasons for the order for spousal support made on April 5, 2011. BACKGROUND FACTS [ 5 ] Ms. Swan and Mr.

Leslie came into their relationship together in September 2005 after their respective marriages had ended. Ms. Swan and her former husband had two children, who were fourteen and eighteen years old, respectively, when this motion was heard. Mr. Leslie and his former wife also had two children, who were twelve and thirteen years old, respectively. [ 6 ] When Ms. Swan and Mr. Leslie began living together, Mr. Leslie was in the process of buying out his former wife’s interest in their matrimonial home. Mr.

Leslie was a full time fireman earning $70,546.00 per year and had a net worth of $37,090.00 but he was unable to pay his former wife the equalization payment he owed and buy her interest in the home and he did not qualify for financing on his own. [ 7 ] Ms. Swan t was working at two jobs and was receiving child support from her first husband, with the result that her income was approximately $69,288.00 per year and she had net assets of $25,084.00.

She therefore agreed to go on the title of his former matrimonial home as the owner of a 50% interest in the property and assume, with him, a new mortgage and joint line of credit. With Ms. Swan’s help, Mr. Leslie paid his former wife her equalization payment and bought her interest in their former matrimonial home. Ms. Swan’s net worth declined from $37,000.00 to $6,000.00 and Mr. Leslie’s increased from $37,090.00 to $83,556.00. [ 8 ] Ms. Swan says that Mr. Leslie was as an alcoholic who consumed a 40 ounce bottle of whiskey every day. He was also a heavy spender.

By the time they separated, he had bought three vehicles having a total value of $66,334.00, had cashed in his RRSPs totaling $30,000 and with the proceeds, bought RESPs for his children totaling $8,000.00, and had a negative net worth. During the course of their four and a half years together, Mr. Leslie and Ms. Swan sold his former matrimonial home and bought a new home for themselves. By that time, Mr. Leslie’s net worth had declined to $13,593.00. [ 9 ] Ms. Swan says that Mr. Leslie was abusive and after he sexually assaulted Ms. Swan’s daughter, she left with her children in March 2009.

By then, both of them had a negative net worth. Although his income as a firefighter had increased to $83,000.00 per year , he failed to service his debt and declared bankruptcy on May 4, 2009. [ 10 ] Ms. Swan had lost her job in a flooring store and obtained alternative employment with a physiotherapist earning $32,000.00 , a decrease of $18,000.00 from her previous income. She had taken out a line of credit in the amount of $14,000.00 at the TD Bank and deposited it to their joint account to pay the bills Mr. Leslie had incurred during their relationship.

The remaining overdraft of $2,800.00 in their joint account at the TD Bank became her responsibility. The balance of their joint line of credit with the RBC, in the amount of $34,900.00, taken out to pay Mr. Leslie’s debts after he separated from his wife, also became her responsibility. [ 11 ] Ms. Swan brought a motion which compelled Mr. Leslie to sell their former matrimonial home. It was sold for $242,000.00 on September 30, 2010, and after the mortgage, taxes and legal fees were paid, Ms. Swan and Mr. Leslie each received $6,955.16. Ms.

Swan paid off the overdraft in the parties’ joint account at the TD Bank, paid her own legal fees for her divorce, sold her motorcycle to pay off the loan she had taken out to buy it, and brought a 2009 car for which her father co-signed her loan. [ 12 ] Ms. Swan now owes the balance on the parties’ joint line of credit with RBC, in the amount of $34,900.00 and her own line of credit with the TD Bank in the amount of $14,000.00, for a total of $48,900.00 .

She works three jobs, which pay $3,200.00 gross per month and she had received $512.00 per month in Child Tax Credit, which was reduced in February 2011 when her eldest child turned 18 years of age. ISSUES [ 13 ] Does Mr. Leslie have an obligation to pay spousal support to Ms. Swan and, if so, in what amount? ANALYSIS AND EVIDENCE [ 14 ] Section 33(8) of the Family Law Act , R.S.O. 1990, c. F.3, provides: An order for the spouse should:

a) recognize the spouse’s contribution to the relationship and the economic consequences of the relationship for the spouse,…

c) make fair provision to assist the spouse to become able to contribute to his or her own support;

d) relieve financial hardship, if this has not been done by orders under Parts I (Family Property) and II (Matrimonial Home). [Emphasis added] [15] The factors to be considered in awarding support are set out in section 33(9) of the Family Law Act, which provides: In determining the amount and duration, if any, of support for a spouse or parent in relation to need, the court shall consider all thecircumstances of the parties, including:

a) The dependant’s and respondent’s current assets and means;

b) The assets and means that the dependant and respondent are likely to have in the future;

c) The dependant’s capacity to contribute to his or her own support;

d) The respondent’s capacity to provide support;

e) The dependant’s and respondent’s age and physical and mental health;

f) The dependant’s needs, in determining which the court shall have regard to the accustomed standard of living while the partiesresided together;

g) The measures available for the dependant to become able to provide for his or her own support and the length of time and costinvolved to enable the dependant to take those measures;

h) Any legal obligation of the respondent or dependant to provide support for another person; …

l) If the dependant is a spouse;

i) The length of time the dependant and respondent cohabited; …

m) any other legal right of the dependant to support, other than out of the public money. [16] In the present case, Ms. Swan made a substantial contribution to relieve Mr. Leslie’s financial responsibilities to his former wifeand to the banks. This has resulted in financial hardship for her. By reason of Mr. Leslie’s income and his bankruptcy, which hasrelieved him of his share of the parties’ liabilities for their former joint debt, Ms.

Swan is in current financial hardship. [17] The fact that a dependant has been left with disproportionate liability for the parties’ joint debt obligations by reason of herspouse’s bankruptcy is a factor that the court can properly take into account in making an order for spousal support to relieve the wife’seconomic hardship. [18] In Freno-Link v. Link, 2001 BCSC 1723 , [2001] 23 R.F.L. (5th) 164, [2001] B.C.J.

No. 2710, the Court held that thehusband’s bankruptcy was a material change in circumstances warranting an increase in spousal support, the objective being to relievethe economic hardship that had resulted from the subsequent events. [19] In Bradley v. Bradley, (ON SC), [2000] O.J. No. 1734, 7 R.F.L. (5th) 270, the court recognized the wife’srepayment of the parties’ joint debt, from which the husband had been discharged from liability through his bankruptcy, as a part of thewife’s need and ordered spousal support to relieve her need. [20] In Taylor v. Taylor, (ON SC), [2004] O.J.

No. 4802, 10 R.F.L. (6th), the husband was ordered to paycompensatory support of $10,000.00 representing money paid by the wife to obtain a release of a joint debt that the husband had beendischarged from through bankruptcy. [21] A DivorceMate calculation, applying the Spousal Support Advisory Guidelines, based on Mr. Leslie’s income of $83,000.00per year and Ms. Swan’s income of $32,000.00 per year, and taking into account Ms. Swan’s Child Tax Credit of $512.00, produces arange from $287.00 per month at the low end, to $382.00 at the high end, with a mid-range of $335.00 per month.

At the high end, thiswould give Mr. Leslie 65.7% of the parties Net Disposable Income and Ms. Swan 34.3%. [22] The advisory amount needs to be adjusted, in the present case, to take account of the disproportionate liability that Ms. Swanhas had to assume resulting from the parties’ joint indebtedness during the period of their cohabitation.

[ 23 ] Having regard to the parties’ respective assets and liabilities, Ms. Swan’s need for support and Mr. Leslie’s ability to provide such support, and the limitations which Ms. Swan’s current circumstances, including her responsibility to care for her children, it is appropriate that the court make an order requiring Mr. Leslie to pay spousal support to Ms. Swan in the amount of $500.00 per month as compensatory spousal support and to relieve against the economic hardship that she has had to assume by reason of Mr. Leslie’s bankruptcy.

This support will be payable effective May 1, 2011, for a period of 53 months, with leave to Ms. Swan to apply after 51 months to have the duration and amount of support reviewed. [ 24 ] The adjusted amount of $500.00 for spousal support will leave Ms. Swan with 35.3% of Net Disposable Income and Mr. Leslie with 64.7%. CONCLUSION AND ORDER [ 25 ] Based on the foregoing, it is ordered that: 1.

The Respondent, David Hyatt Hugh Leslie, shall pay to the Applicant, Jennifer Swan, commencing May 1, 2011, and on the 1 st and 15 th of every month thereafter, the sum of $500.00 spousal support for a period of 53 months. 2. Ms. Swan has leave, at any time after the 51 st month, to apply to this court for a review of Mr. Leslie’s spousal support obligation to her. 3. This Order shall take the place of the Order made by me on April 5, 2011. 4.

U nless this order is withdrawn from the Office of the Director of the Family Responsibility Office, it shall be enforced by the Director, and amounts owing under this order shall be paid to the Director, who shall pay them to the Applicant. 5. If the parties are unable to agree on costs, they may make submissions, by December 10, 2011, in no more than two pages, in addition to a Costs Outline. 6. Approval of this Order as to form and content is dispensed with. ___________________________ Price J. Released: November 21, 2011 CITATION: Swan v. Leslie, 2011 ONSC 6879 COURT FILE NO.: 2701/10 DATE: 2010-11-21

ONTARIO SUPERIOR COURT OF JUSTICE B E T W E E N: JENNIFER SWAN Applicant – and – DAVID HYATT HUGH LESLIE Respondent REASONS FOR ORDER Price J. Released: November 21, 2011