) ) Mark Stephen Danecker Applicant – v. –, 2013 ONSC 1605

CITATION : Danecker v. Danecker, 2013 ONSC 1605 WELLAND COURT FILE NO.: 22539/10 DATE: 2013-03-15 ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: ) ) Mark Stephen Danecker Applicant – and – Lise Anita Danecker Respondent ) ) ) ) ) ) ) ) ) Kevin Robins, for the Applicant Luigi DeLisio, for the Respondent ) ) ) HEARD: July 11, 12, and 13, 2012 and October 22, 23, 24, 25 and 26, 2012 THE HONOURABLE jUSTICE T. MADDALENA J U D G M E N T THE ISSUES [ 1 ] These parties were married on April 21, 1990 and separated on or about January 13, 2010.

The husband’s last day at the jointly owned partnership business was December 4, 2009.

While the parties do not agree on the exact date of separation, the date of valuation/separation is not an issue in these proceedings. [ 2 ] There are three children of the parties’ marriage, namely, Ryan Alexander Danecker, born May 17, 2002; Jessica Danielle Danecker, born March 20, 1999; and Erik Davis Danecker, born August 9, 1995. [ 3 ] To their credit, these parties have been able to resolve all issues pertaining to their children, and a substantial part of their financial matters by way of partial minutes of settlement dated July 11, 2012 and filed with the court. [ 4 ] Further, based on the oral evidence of the applicant husband, on July 13, 2012 a divorce order was issued by the court. [ 5 ] The remaining issues for determination by the court are as follows:- (

i) The valuation of Stamford and Phoenix Physiotherapy Clinics for purposes of equalization of net family property; (ii) Minor adjustments between the parties for items such as disability premiums, car insurance premiums, life insurance premiums, which adjustments are dealt with herein; (iii) Issue of cheques received by the respondent wife from the physiotherapy clinic for 2009 in the amount of $30,310 and not deposited until 2010. (iv) A loan to the respondent wife’s sister; (

v) A loan to the respondent wife’s mother; (vi) The adjustment to the matrimonial home mortgage. With respect to the mortgage on the matrimonial home, the parties agree that the mortgage figure used when the respondent wife purchased the husband’s interest in the home was $219,000 whereas the exact mortgage amount was $201,431. The parties agree on this figure, thus an adjustment is required in favour of the applicant husband. THE HISTORY OF STAMFORD AND PHOENIX PHYSIOTHERAPY CLINICS [ 6 ] Mr. Danecker (hereinafter referred to as the husband) received his training in physiotherapy and is a licenced physiotherapist.

[ 7 ] Ms. Danecker (hereinafter referred to as the wife) is also a licenced physiotherapist. [ 8 ] In May of 1989 the respondent wife and Mr. Peter Lanni opened Stamford Physiotherapy Clinic in Niagara Falls, Ontario. At that time Mr. Lanni worked about ten hours and the respondent wife about 40 hours. Their income agreement stated that 75 percent of profits were paid to the respondent wife and 25 percent to Mr. Lanni. Both Mr. Lanni and the respondent wife each contributed $30,000 to open the Stamford Physiotherapy Clinic. [ 9 ] In October of 1989 the applicant husband joined the clinic.

In 1992, the applicant husband became an income partner. An agreement was prepared and dated May 1, 1992, allocating profits of the clinic as follows:- 25 percent to Peter Lanni, 25 percent to the respondent wife, and 50 percent to the applicant husband. [ 10 ] In 2005 the husband set up a physiotherapy clinic at the YMCA in Niagara Falls called Phoenix Physiotherapy. This was opened in the husband’s name alone. [ 11 ] On the 31 st of December 2005 the wife purchased Peter Lanni’s partnership interest in Stamford Physiotherapy for $35,000. Thus, since the 31 st of December 2005, Mr.

Lanni has no longer been involved in the Stamford Physiotherapy Clinic. [ 12 ] In 2007 Phoenix Physiotherapy located at the YMCA in Niagara Falls was rolled into the partnership. The merged operations provided for easier accounting and less expense so that commencing January 2007 there was only one set of books with the husband and wife as equal partners in Stamford and Phoenix Physiotherapy Clinics. [ 13 ] In July of 2007, the parties purchased 4315 Drummond Road in Niagara Falls which was to be the future location of Stamford and Phoenix Physiotherapy Clinics.

Substantial renovations took place with respect to the property at 4315 Drummond Road, Niagara Falls, and Stamford and Phoenix Physiotherapy Clinics opened in their new location in March of 2008. At that time, the location at YMCA was closed and all patients were treated at the main clinic. [ 14 ] The history of the clinic is that generally, in the latter years, the wife divided her duties between patient care and administrative and marketing duties.

She performed about 15 hours per week in patient care and 25 hours per week on things such as banking, administration and marketing. [ 15 ] The husband continued as a full time therapist often working 50 to 60 hours per week and seeing 40 to 50 patients per day.

This continued, for the husband until approximately November 2009 when he commenced working Monday, Wednesday and Friday mornings. [ 16 ] From the evidence, it is clear that trouble was brewing in this marriage from at least the summer of 2009. [ 17 ] Two of the friends of the wife, Lucy Borghesi and Lisa Kyte, both stated in evidence that the husband had contacted them in the summer of 2009 to advise he would be leaving the marriage and also the physiotherapy clinic. [ 18 ] The wife’s evidence is that the husband told her in October of 2009 that he would be quitting and that she tried to talk him out of it but that he was adamant that he would be leaving. [ 19 ] It is undisputed that the husband’s last day at the physiotherapy clinic was December 4, 2009.

The wife continued to operate the physiotherapy clinic. [ 20 ] The evidence is that the husband at some point in January of 2010 attempted to re-open or operate out of the YMCA location, however disagreements quickly arouse between the parties as to the operation of that clinic. There was the threat of injunctions and the husband backed down from attempting to work out of the YMCA location. The husband soon after found alternate work. Initially, he divided his time between the Port Colborne and Fort Erie hospitals as a physiotherapist.

He was eventually able to obtain full time hours as a therapist at the Welland General Hospital where he is still employed. [ 21 ] The evidence is also clear that the wife purchased the husband’s interest in the matrimonial home on the 31 st of March 2011. She bought out his interest for the amount of $13,493.62. [ 22 ] Further, the wife bought the husband’s interest in the building that housed Stamford and Phoenix Physiotherapy Clinics on the 31 st of March 2011.

For his interest in the building, the husband was paid $275,000. [ 23 ] The husband states that he has received no accounting of the business since he left the business on December 4, 2009. He has stated that he has requested financial information of the clinic but has not received all of the information requested.

The husband states that after the separation he requested monthly summaries since he still continued to have a 50 percent interest in the partnership but the wife provided none of that information. [ 24 ] The wife disagrees and states that the husband had available to him a lot of records that he could have accessed but chose not to. THE DURWARD JONES REPORT [ 25 ] The main issues between the husband and the wife with respect to Stamford and Phoenix Physiotherapy Clinics are:-

(1) What is the value of this business partnership for equalization purposes;

(2) Once its value is ascertained, can one party be forced to buy out the interest of the other or should it be ordered sold on the open market.

[ 26 ] The wife states the business is worth $175,000.00. She wishes to purchase the husband’s share using that value. Alternatively, she wishes the business sold on the open market or will sell to the husband for the sale price of $175,000. [ 27 ] The husband’s position is that the value of the partnership is as stated in the expert report prepared by Dwayne Pyper of the Durward Jones Barkwell and Company LP wherein Mr.

Pyper concludes that the goodwill of Stamford and Phoenix Physiotherapy Clinics is valued at $443,000, effective January 13, 2010. [ 28 ] The report prepared by Dwayne Pyper of Durward Jones Barkwell and Company LP is dated October 14, 2011. It provides a valuation for the business effective the 13 th of January, 2010. Although the husband left the business on December 4, 2009, the parties continued to live separate and apart under the same roof until approximately January 13, 2010.

For purposes of this evaluation, there is no issue with the date of the 13 th January, 2010. [ 29 ] The report of Durward Jones is the only expert report and Mr. Pyper was the only expert witness at this trial. [ 30 ] Initially, by order made on consent September 7, 2010, the parties agreed that Mr. Pyper of Durward Jones Barkwell and Company LP would prepare a preliminary opinion of value for Stamford and Phoenix Physiotherapy Clinics. However, the undisputed evidence is that in the end only the husband participated and executed the engagement letter. [ 31 ] It was agreed by both parties, on consent, that Mr.

Pyper was qualified as an expert witness in business valuations. The report prepared by him was entered into evidence as court Exhibit No. 13. [ 32 ] The purpose of the report is identified in paragraph 1 therein as follows:- “We have prepared this Estimate Valuation Report to be used only to provide an indication as to the fair market value of the goodwill of the partnership of Stamford and Phoenix Physiotherapy Clinics as at January 13, 2010 for the sole purpose of determining net family property.

As no balance sheet was provided, we do not include a value for the tangible assets of the partnership.” [ 33 ] Further, paragraph 2

b) of the report states as follows:- “The preparation of a business valuation conclusion is a complex process that generally is not susceptible to partial analysis. Alteration of any one part of the analysis may change the conclusion set out in this report. We recommend consideration of the conclusions, commentary and calculations as a whole, so that the business itself and the value conclusion can be best understood.” [ 34 ] The report defines fair market value in paragraph 3

a) as follows:- “Fair market value is defined as the highest price, obtained in an open and unrestricted market, between informed and prudent parties, acting at arms length, under no compulsion to act, expressed in cash.” [ 35 ] The report concludes in paragraph 5 therein, that after considering various approaches and methodologies, and considering the approaches of capitalized income, capitalized cash flow and rules of thumb, that the fair market value of the goodwill of Stamford and Phoenix Physiotherapy Clinics as at January 13, 2010 is $443,000. [ 36 ] Mr.

Pyper described this report as an “estimate valuation report” which points to a “middle level of assurance” for Stamford and Phoenix Physiotherapy Clinics as at January 13, 2010. [ 37 ] No balance sheets were provided so no value was ascribed to the tangible assets of the partnership and thus only goodwill was valued. The report describes goodwill as based on revenues and income that the business generates. [ 38 ] Mr.

Pyper noted in the report that the partnership operates in a service industry that has demonstrated “stable revenue and earnings given its sales over the last several years …." [ 39 ] The wife had two main objections to the report prepared by Mr. Pyper. First, she objected to the wage of $25,000. Secondly, she objected to the expert’s use of corporate income tax rates in the calculations instead of personal income tax rates. [ 40 ] The wife maintained that the partnership had not incorporated, thus corporate tax rates were not applicable to Stamford and Phoenix Physiotherapy Clinics. Mr.

Pyper stated that since the business is allowed to incorporate, it is appropriate to utilize the corporate tax rates since “a prudent purchaser would take advantage of the lower tax rates accorded upon incorporation. Therefore corporate tax rates have been used to estimate the value of the partnership.” Mr.

Pyper utilized the corporate tax rate of 16 percent in determining the after tax income stream. [ 41 ] The wife did not put forth any evidence to effectively refute this, other than to state that the partnership in issue here was not a corporation and had no history of incorporation. [ 42 ] The second major objection of the wife to the expert’s report was that the wage ascribed to her of $25,000 in the report was not adequate or correct. The wife stated that in 2010 she had actual earnings of $136,021. In 2011, she earned $66,269. [ 43 ] Mr.

Pyper stated in evidence that in discussions with the husband he concluded that a reasonable salary for the husband was $80,000 and $25,000 for the wife based on industry standards. He further stated that he also used independent evidence to arrive at the wages for both parties, that is, $80,000 for the husband as a full time therapist and $25,000 for the wife to reflect part-time bookkeeping duties and two weeks as a physiotherapist to cover for vacations as reflected in

Schedule 3 of the expert’s report. [ 44 ] The wife’s criticism of the report is the wage of $25,000 could not possibly cover her work as part-time bookkeeper, fill in physiotherapist for vacations, clinic manager and the person doing the marketing at the clinic and other administrative duties.

[ 45 ] The wife further stated in her evidence that a salary of $80,000 ascribed to the husband was not adequate since in this case the husband worked 50 to 60 hours per week and saw about 40 patients per day. He should be earning substantially more than $80,000 annually and she also much more than $25,000 annually. The wife suggested that it would require more than one full time physiotherapist to cover the work that the husband performed at the clinic. [ 46 ] Peter Lanni, the former partner of the wife and now manager of the Canadian Back Institute in Niagara Falls gave evidence on behalf of the wife.

He had been a partner in the Stamford Physiotherapy Clinic until December 31, 2005. It is Mr. Lanni’s evidence that given the description of the wife’s activities, that the wife’s salary should be closer to $75,000 annually. This would include a salary as manager of the clinic, administrator of the clinic, person responsible for marketing, and person covering as physiotherapist for vacations and having a small patient case load. He emphatically stated that he would not be in a position and could not be in a position to hire someone to do what the wife did for a salary of $25,000 annually.

He suggested, based on his experience, a breakdown as follows:- $25,000 to cover the wife’s client coverage for vacations; $50,000 for all administrative, managerial and marketing duties. [ 47 ] Mr. Lanni also stated that based on the husband’s experience of 25 years as a physiotherapist, that if a physiotherapist is seeing approximately 18 to 25 patients per day the average annual salary would be $85,000. If a physiotherapist with 25 years experience sees 40 patients per day, the salary sould be in the range of $160,000 annually. [ 48 ] Mr.

Lanni was not proffered as an expert witness but gave the evidence based on his many years experience as a physiotherapist and manager at the Canadian Back Institute Clinic in Niagara Falls. [ 49 ] Evidence was also provided on behalf of the wife by Lisa Kyte, who is a physiotherapist with 25 years experience. Ms. Kyte runs her own clinic in Carp, Ontario (near Ottawa, Ontario). [ 50 ] Ms. Kyte gave evidence that a full time physiotherapist seeing approximately 17 to 20 patients daily would demand a salary of approximately $85,000 annually. Ms.

Kyte also stated in her evidence that her business partner who performs full time management duties at her clinic, staffing duties, administration, marketing, and Christmas relief for vacations draws an annual salary of approximately $90,000 annually. [ 51 ] Both Mr. Lanni and Ms. Kyte stated in their evidence that they would be unable to hire someone at their clinic to perform the duties that the wife performed at Stamford and Phoenix Physiotherapy Clinics and pay that person $25,000 annually. [ 52 ] It was also the wife’s evidence that no one at her clinic earned as low as $25,000 annually.

The full time physiotherapy assistant was paid $31,000 annually and the receptionist at the clinic was paid $38,000 in 2009. [ 53 ] The wife also objected to the fact that, although she was management at the clinic, she was not contacted by Mr. Pyper nor was information requested of her with respect to the report. [ 54 ] What the court finds perplexing is that the wife, despite these disagreements, did not proffer her own expert’s report calculated in accordance with her numbers that she says are the correct numbers to be utilized. [ 55 ] The wife did request Mr.

Pyper to prepare simple calculations based on numbers provided by her for differing salaries and tax rates but those calculations were merely thumb nail calculations taking approximately one hour of the expert’s time. These numbers were not incorporated into a business valuation report which is a more complex calculation. [ 56 ] At Exhibit No. 5, Tab 1, the wife put forth one sheet of calculations prepared by Wendy N. Neidhardt, CPA, showing $175,288 as valuation for the partnership.

Based on this calculation, the wife obtained her evidence for the value of the business as $175,000. [ 57 ] The court notes however that Ms. Neidhardt did not give evidence nor was any proper report prepared by her. [ 58 ] The court also notes Ms. Neidhardt is not a business valuator. CONCLUSIONS ON THE VALUATION [ 59 ] It is most unfortunate that the wife did not request a valuator’s report.

Part of the reason is, perhaps, the wife’s argument that the court cannot compel her to buy out the husband’s interest if she disagrees with its value and the property should ultimately be put on the market for sale. [ 60 ] The court notes, however, that the wife has continued to operate the clinic in 2010, 2011, 2012 and 2013 to date. The husband has received no revenues from the clinic since January 1, 2010. [ 61 ] The wife purchased the husband’s interest in the physical building on the 31 st of March, 2011, thus clearly showing her intent to carry on in the clinic and she has done so.

This is to her credit as to have walked away from it could have meant that there would have been no asset. [ 62 ] While the wife insists on using the figure for valuation at $175,000, there is no expert report proffered by her to support this nor is there any report to properly challenge the husband’s expert report. I do not find anything raised that materially affected the methodology or the calculations of Mr. Pyper. I find the valuation report credible and acceptable. [ 63 ] Thus, the wife has not successfully challenged the expert’s valuation and calculations.

However, I am satisfied that there is some evidence put forward in the wife’s case that the salary attributed to her should be higher than the $25,000 used by Mr. Pyper in his

report. [64] Business valuations utilize complex formulas and calculations. These calculations require an expert. [65] The court cannot perform these calculations. The court can only utilize the evidence put before it. [66] However, this matter also requires finality between these parties and thus I am not prepared, as suggested by Mr. Robins inhis submissions, to request the valuator to perform different calculations based upon numbers chosen by the court.

That option, whileenticing since it would give us a more exact calculation, will simply cause the litigation to linger between these parties. [67] Therefore, utilizing the best evidence before me, I have chosen the value of the business as the average of the value ascribedby Mr. Pyper in his report, and the value ascribed by the wife (without an expert) as follows:- Mr. Piper’s report $443,000 Wife’s value $175,000 $618,000 The average is $309,000. On equalization, therefore, the husband’s share is $154,500 and the wife’s share is $154,500.

SALE OR BUY-OUT? [68] Can or should the court order the wife to buy the husband’s share or simply order the sale of the partnership on the openmarket and the net proceeds divided between the husband and the wife upon its sale? [69] Here we have a partnership asset owned equally by the husband and the wife. This asset has been in the sole control of thewife since the husband left on December 4, 2009.

At this trial, the wife takes the position that she is prepared to purchase the husband’sinterest only if a value of $175,000 is ascribed to the business and, thus, on an equalization calculation the husband is owed $87,500. Otherwise, the wife takes the position that the husband can buy her interest using that same value of $175,000. Alternatively, it is thewife’s position that the business should simply be sold on the open market. [70] The court notes that it is very unlikely that the husband would be interested in the purchase of the business at this time.

Theevidence is that he has had full time employment as a physiotherapist with the Niagara Health System since early 2010 and therefore notlikely that he would be prepared to purchase her interest. In early 2010, both parties were keenly interested in each purchasing thebusiness, however the evidence shows that they were unable to agree on its valuation. [71] It is inappropriate and unjust to simply deal with this as one might deal with a matrimonial home or other similar propertywhere the parties cannot agree with respect to the joint asset.

In those circumstances, such as a matrimonial home, it is clear that thecourt would simply order that asset listed for sale on the open market and the proceeds divided equally. [72] In this case, there is a partnership that the wife has continued to operate solely since 2010. She has had the sole control,direction and management of it. She has collected all the revenues and has worked to maintain it. There is no evidence of any currentday valuation for that partnership. [73] The husband has received no income of any kind since 2010 for his ownership in the partnership.

He has not worked in itsince December 4, 2009. [74] If a sale were ordered with proceeds divided there is also the issue of the husband’s entitlement to an accounting and share ofthe profits for 2010, 2011, 2012, 2013 and continuing until sold. [75] This is will likely create further costs and a need for further calculations which will likely be the subject of further disputebetween these parties. These parties need finality to this litigation. [76] I am fully aware and have completely considered the position of the courts in the following cases:- • Wilson v. Wilson (ON SC), 14 R.F.L. (3rd) 98 • Baker v.

Baker (ON SC), 22 R.F.L. (3rd) 346 • Asadoorian v. Asadoorian (ON SC), 37 R.F.L. (4th) 197. [77] In the case of Wilson v. Wilson the court stated at page 8 therein as follows: “…in my opinion, the court should not re-arrange assets in an attempt, to effect satisfaction of the equalization payment. (See Skrlj v. Skrlj (1986), (ON SC), 2 R.F.L. (3rd) 305 (Ont. H.C.)). If the parties are prepared to agree upon current value of theassets and the means of effecting the equalization payment, including transfer of property, the court can give effect to such anagreement.

Failing any such agreement, however, the court should order the sale of all jointly owned property in order to ensure that fairmarket value is obtained. Accordingly, I order the sale of 117 Thornbeck Drive, and the cottage. Mr. Wilson shall pay to Mrs. Wilsonher equalization payment of $9,259 from his share of the first property sold …” [78] In Baker vs. Baker the court dealt with the matrimonial home and the wife’s request for lump sum support from the proceedsof the sale of the home. The court indicates as follows:-

“As the parties cannot agree on the valuation of the matrimonial home, I order its immediate listing for sale. The applicant sought anorder of this court to transfer the property to her at a valuation put forward by her. A court should not transfer property to satisfy anequalization payment or allow a joint owner to purchase his or her co-tenant’s interest for a fixed price. In Wilson v. Wilson (1998) 14 R.F.L. (3rd) p. 98, Grange J. said at page 110: “In my opinion, the court should not re-arrange assets in an attempt, to effect satisfaction of the equalization payment: see Skrlj v.

Skrlj (1986), (ON SC), 2 R.F.L. (3rd) 305 (Ont. H.C.). If the parties are prepared to agree upon current value of the assetsand the means of effecting the equalization payment, including transfer of property, the court can give effect to such an agreement. Failing any such agreement, however, the court should order the sale of all jointly owned property in order to ensure that fair marketvalue is obtained.” “See also, Batler v. Batler (1988), 13 A.C.W.S. (3d) p. 176 (H.C.J.) and Skrlj v. Skrlj (1986) 2 R.F.L. (3d) (Ont. H.C.).

If the parties areunable to agree on the listing price or terms of the sale, I order a reference to the Clerk of the Court to effect the sale.” [79] In the case of Asadoorian v. Asadoorian at paragraph 34 the court states: “The law is quite clear that where the parties have been unable to agree on the current value of assets and the means of effecting theequalization payment, “the court should order the sale of all jointly owned property in order to ensure that fair market value is obtained.(per Justice Granger in Wilson v.

Wilson (1988), 14 RFL (3d) at p.111).” [80] The courts underlying focus is fairness as well as a just and equitable result having regard to all the circumstances. [81] The wife has had the sole control of the partnership since December 4, 2009. She may continue to have the sole control of thepartnership. However, it is fair and just that she pay the husband’s interest in same. [82] For all of the above reasons, I conclude that the wife owes to the husband on account of his share of the partnership, effectiveJanuary 13, 2010, the sum of $154,500. This will be added as owing by the wife to the husband on

Schedule “A” attached hereto and onthe net family property statement at

Schedule “B” attached hereto. I do not order the sale of the partnership, however should the wifewish to sell same in order to pay her equalization payment, she may do so. OTHER ADJUSTMENTS CHEQUES FOR 2009 TOTALLING $30, 310 [83] The husband’s evidence is that he found in January of 2010 cheques properly belonging to the partnership for services paidfor in 2009 and not deposited by the wife to the partnership in 2009. He found these cheques in a file in the back of the wife’s motorvehicle. The cheques totalled $30,310 and were dated from October 2009 to the end of December 2009.

These amounts wereacknowledged by all parties and not disputed. [84] The husband’s evidence is that he received no payment as a result of these cheques. Normally, those cheques would beentered as revenue received by the business in 2009 from which would be deducted clinic expenses. [85] The wife acknowledged the cheques in question totalled $30,310 and were not deposited in 2009.

The wife stated that it wasnormal practice to deposit cheques received late in the year to early the following year to defer payment of income taxes. [86] The wife confirmed in her evidence that the cheques totalling $30,310 from the year 2009 were deposited from January 15th through to February 2010. She cannot state why they were not deposited all at once but stated in her evidence that probably she hadother cheques to deposit and “just got mixed up”.

She also stated that she “may have forgotten on her way to do a deposit”, but she“cannot say”. [87] The wife maintains in her evidence that deductions for overhead and taxes should be applied against those cheques. [88] The wife, in Exhibit No. 27, calculated that after deduction for overhead expenses and income taxes the total amount to bedivided is $6,383 (rounded) and the husband’s 50 percent share is $3,191 (rounded). [89] It is clear to the court that the manner in which the wife handled these cheques, i.e. by not depositing them in 2009 butchoosing to deposit them in 2010, probably increased the mistrust and animosity between the parties and certainly would have arousedsuspicion on the part of the husband regarding the wife’s disclosure in this regard.

Even if one accepts that this was a “normal”occurrence for the partnership at the year end, one would have at least anticipated that December 2009 would not be a “normal” year endas the parties had separated and therefore things must be done in a scrupulously correct manner. [90] The cheques should have been deposited in 2009 but were deposited in 2010. Thus, there is no overhead change for 2009. However, it is appropriate to deduct personal income tax rates as any amount paid out to the partners as profit would inevitably incurpersonal income taxes. I have rounded that income tax rate to 38 percent.

Thus, $30,310.00 Less 38% $11,518.00 (rounded) $18,792.00 Thus, the wife is entitled to $9,396 and the husband is entitled to the $9,396 as an adjustment. This adjustment is reflected in Schedule“A” attached hereto.

OTHER MISCELLANEOUS ADJUSTMENTS [ 91 ] These adjustments are with respect to Exhibit 5, Tab 2. [ 92 ] Firstly, the wife seeks an adjustment of $6,746 from the husband for property taxes, hydro, water, gas and house insurance from the period January 2010 to March 31, 2011 when she bought the husband’s interest in the matrimonial home. [ 93 ] The evidence is that the wife and children lived in the home. The wife had exclusive possession, use and enjoyment of the home while the husband was living elsewhere from on or about January 13, 2010.

The husband was paying child support from January 2010 onward and thus it is appropriate to order that there be no adjustment here as requested by the wife. [ 94 ] Secondly, the wife seeks an adjustment for disability premiums that she paid for the husband from December the 3, 2009 to July 3, 2012. These amounts total $1,461. The husband acknowledges that these are a proper adjustment and, accordingly, I order this adjustment in favour of the wife. This adjustment is also shown on

Schedule “A” attached hereto. [ 95 ] Thirdly, the wife seeks an adjustment for car insurance premiums paid by her for the husband from January 13, 2010 through to March 31, 2010 in the amount of $683.93. [ 96 ] The husband agrees that he should pay this adjustment, and, accordingly, I have made an adjustment for $684 (rounded) on

Schedule “A” attached hereto. [ 97 ] Fourthly, the wife claims reimbursement for accidental death and dismemberment and life insurance premiums from December 3, 2009 through to July 3, 2012 in the amount of $346 (rounded). [ 98 ] These are business premiums. The husband was not at the business and, accordingly, I do not order this adjustment. [ 99 ] Fifthly, the wife seeks an adjustment for extended health care premiums for the husband and the three children from December 3, 2009 through to July 3, 2012.

The total cost to the wife for these premiums was $8,402 (rounded) and she seeks $4,201 as reimbursement from the husband. [ 100 ] The difficulty the court finds with the wife’s position with respect to these expenses is that these were business expenses, properly written off by her in the partnership business. The husband has not been privy to nor participated in the business since December 4, 2009. Therefore, this is not an appropriate adjustment to be claimed. [ 101 ] Sixthly, the wife seeks reimbursement and adjustment with respect to the rental company known as REJ Rentals.

The wife’s evidence is that she made a personal advance of $2,000 to REJ Rentals on February 6, 2010. She further made additional advances from the business on October 15, 2010 and October 29, 2010 totalling $6,500 to REJ Rentals to keep it solvent. [ 102 ] The wife claims $4,250 as reimbursement from the husband. [ 103 ] The evidence is that the parties divided the income from REJ Rentals for 2010 on a 50/50 basis. Therefore, the husband owes to the wife $4,250 on account the adjustment for REJ Rentals for the year 2010. This has also been shown as an adjustment on

Schedule “A” attached herein. MORTGAGE ADJUSTMENT [ 104 ] The parties both acknowledge that an adjustment with respect to the matrimonial home is required. It is undisputed that the wife purchased the husband’s interest on March 31, 2011. All the parties agree that in the calculation the mortgage outstanding was shown as $219,000. However, when the parties obtained the actual mortgage payout statement from the financial institution, the amount actually outstanding on the current mortgage registered on the matrimonial home was $201,431.32. [ 105 ] Thus an adjustment is required in favour of the husband of $8,784 (rounded). This adjustment is also reflected in

Schedule “A” attached. LOAN TO GINA MAROTTA [ 106 ] The wife’s sister, Gina Marotta, acknowledged that a loan of $5000 was given to her by the wife approximately 15 years ago to purchase shares of Pelangio Larder Mines Limited. Ms. Marotta acknowledged that she still owns the shares and acknowledged that she still owes the $5000 for the loan. [ 107 ] The husband, in his evidence, stated that he believed the amount loaned was $10,000. However, there is nothing in writing and I am satisfied based on the evidence of Ms.

Marotta that the loan was for $5000. [ 108 ] The loan would appear to be statute barred, however, Ms. Marotta acknowledged the $5,000 outstanding and her evidence in this regard is accepted. Accordingly, the wife will owe to the husband $2,500 regarding this loan to her sister and this adjustment is made on

Schedule “A” as well as on the net family property calculation shown as

Schedule “B”. LOAN TO WIFE’S MOTHER, DANIELLE PIETRANGELO [ 109 ] The husband and wife both acknowledge that the wife made a loan to her mother, Ms. Danielle Pietrangelo, of $6000 U.S. for a trip to Florida. [ 110 ] Both the wife and her mother state in evidence that this loan was repaid, in cash, upon the mother’s return from Florida. [ 111 ] The husband states in his evidence that, to his knowledge, this loan has not been repaid and is still outstanding.

[ 112 ] Based upon all of the evidence regarding this loan, I am satisfied it has been repaid and no further adjustment is either required or ordered.

SUMMARY OF ORDERS [ 113 ] It is ordered as follows:

(1) The husband’s one-half interest in the partnership shall be valued at $154,500 (100 percent value equals $309,000). This figure shall be reflected on the parties’ net family property statement (as shown on

Schedule “B” herein).

(2) The wife shall pay to the husband on account of cheques totalling $30,310 deferred by her from the partnership in the 2009 tax year the amount of $9,396 representing his net share of those cheques.

(3) The wife shall pay to the husband the sum of $8,784 on account of the adjustment for the mortgage on the matrimonial home.

(4) The wife shall pay to the husband the sum of $2,500 representing the outstanding loan of $5000 to the wife’s sister. The sum of $5000 shall be reflected on the net family property statement.

(5) The husband shall pay to the wife on account of adjustments for REJ Rentals for the year 2010, the amount of $4,250.

(6) The husband shall pay to the wife on account of the disability premiums paid personally by the wife for the husband the sum of $1,461.

(7) The husband shall pay to the wife for car insurance premiums paid by the wife for the husband in the amount of $684. COSTS [ 114 ] Unless otherwise agreed, the parties may make written submissions as to costs limited to three pages and bill of costs. The husband’s submissions are due by March 29, 2013 and the wife’s submissions are due by April 12, 2013. Maddalena, J. Released: March 15, 2013 CITATION : Danecker v. Danecker, 2013 ONSC 1605 WELLAND COURT FILE NO.: 22539/10 DATE: 2013-03-15

ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: MARK STEPHEN DANECKER Applicant LISE ANITA DANECKER Respondent REASONS FOR JUDGMENT Maddalena, J. Released: March 15, 2013