“Under s. 178(1) of the BIA (Bankruptcy Insolvency Act), an order of discharge does not release the bankrupt from any debt or liability under an agreement for maintenance and support of a spouse or former spouse. The word “support” in the BIA does not include a division of matrimonial property. However, “support” is not defined in the BIA. Whether a particular amount claimed pursuant to a separation agreement is “support” within the meaning of the BIA is a question of fact to be determined with regard to the words of the agreement and the circumstances under which it was entered into. A particular disposition of property which is intended to be maintenance or a substitute for it can fall within s. 178 of the BIA and yet not qualify as support under the Divorce Act, R.S.C. 1985, c. 3 (2nd Supp.).”
Month: March 2019
March 27 – Duress
“The law will not lightly set aside contracts reached by parties having contractual capacity: John D. McCamus, The Law of Contracts, 2d ed. (Toronto: Irwin Law, 2012), at p. 378. Duress is one basis upon which an otherwise valid contract can be rendered unenforceable.
This court set out the test in Hill v. Forbes, 2007 ONCA 443 (CanLII), 225 O.A.C. 74, at para. 12, citing the earlier case of Stott v. Merit Investment Corp (1988), 1988 CanLII 192 (ON CA), 63 O.R. (2d) 545, 1988 CarswellOnt 887 (C.A.), at para. 48 (WL Can):
But not all pressure, economic or otherwise, is recognized as constituting duress. It must be a pressure which the law does not regard as legitimate and it must be applied to such a degree as to amount to “a coercion of the will”, to use an expression found in English authorities, or it must place the party to whom the pressure is directed in a position where he has no “realistic alternative” but to submit to it, to adopt the suggestion of Professor Waddams (S.M. Waddams, The Law of Contract (2nd ed., 1984), at p. 376 et seq.). Duress has the effect of vitiating consent and an agreement obtained through duress is voidable at the instance of the party subjected to the duress unless by another agreement or through conduct, either express or implied, he affirms the impugned contract at a time when he is no longer the victim of duress.
Another formulation of the test applicable to economic duress, taken from the Pao On v. Lau Yiu, [1979] 3 All E.R. 65 (P.C.), and cited in Stott, at para. 49 (WL Can), is: “the victim must have entered the contract against his will, must have had no alternative course open to him, and must have been confronted with coercive acts by the party exerting the pressure”.
Where duress is alleged, the contractual obligations often demonstrate some element of unusual advantage favouring the party with the dominant power.”
March 26 – Expectation Agreement Will Be Enforced
“Once an agreement has been reached, albeit a marriage agreement, the parties thereto are expected to fulfill the obligations that they have undertaken. A party cannot simply later state that he or she did not intend to live up to his or her end of the bargain. It is true that, in some cases, agreements that appear to be fair at the time of execution may become unfair at the time of the triggering event, depending on how the lives of the parties have unfolded. It is also clear that the [British Columbia’s Family Relations Act] FRA permits a court, upon application, to find that an agreement or the statutory regime is unfair and to reapportion the assets. However, in a framework within which private parties are permitted to take personal responsibility for their financial well-being upon the dissolution of marriage, courts should be reluctant to second-guess their initiative and arrangement, particularly where independent legal advice has been obtained. They should not conclude that unfairness is proven simply by demonstrating that the marriage agreement deviates from the statutory matrimonial property regime. Fairness must first take into account what was within the realistic contemplation of the parties, what attention they gave to changes in circumstances or unrealized implications, then what are their true circumstances, and whether the discrepancy is such, given the s. 65 factors, that a different apportionment should be made.”
Hartshorne v. Hartshorne, [2004] 1 SCR 550, 2004 SCC 22 (CanLII) at 67
March 25 – Impact of Parent’s Arrest in Family Law Case
“The events after the arrest of Ms. Shaw do not, in retrospect, show the police, the Crown, counsel or the criminal judicial system in a good light, although her story is commonplace. These events have become routine and predictable in almost every allegation of spousal assault such that there is presumably some policy guiding the police and the Crown attorney and forestalling professional discretion in all such matters, no matter how remote the assault may be in time or indeed how trivial the contact. Spouses of every walk of life and often with completely unblemished prior character are routinely detained for a formal bail hearing for such assaults. Invariably, the defendant (not yet convicted) is excluded from his or her home and prevented from exercising custody of or access to the defendant’s children without any consideration of the factors that this court must apply by law before determining incidents of custody or access. This is not for one moment to diminish the impact of spousal abuse on family members and children in Canada. Spousal assaults are by nature serious and there are very sound policy reasons to lay such charges and have them proceed through the judicial system to ultimate resolution if not diverted. I observe, however, that the damage of which I speak is not from the laying of the charge — this will happen in any event, regardless of the manner in which the defendant is brought before the court. The way that the criminal justice system approaches the commencement of these matters, however, often wreaks family law havoc with the family unit of the defendant and the complainant, and in particular the children of those parties. Family courts decide custody and access issues on the basis of statute and case law defining the best interests of the children. The criminal justice system pays no attention to such interests because it is not geared up to do so nor are the participants widely trained in how the actions of the system — from the officer who refuses to release the defendant at the station, to the duty counsel who allows the defendant to agree to inappropriate conditions of release out of expediency — effect the lives of the members of the defendant’s family. Similarly the Superior Court is tasked with the duty of adjudicating the respective rights of the parties to remain in the matrimonial home pending the resolution of the matrimonial litigation. Routine orders excluding a party from the common home of the parties until the end of the criminal matter without thought to the consequences thereof, and without a remedy short of a bail review, place one party in a position of immediate superiority over the other party for as long as it takes (perhaps a year) for defended criminal charges to be resolved. Such rote treatment of all matters of domestic assault can lead, on the one hand, to concocted or exaggerated claims of criminal behaviour or, on the other hand, to innocent defendants pleading guilty at an early stage out of expediency or a shared desire with the complainant to start to rehabilitate the family unit.”
March 22 – Step-Down Orders & Terminating Spousal Support
“Where a spousal support recipient has had ample time to become self-sufficient and has taken no steps to do so, spousal support may be terminated. If support is continued, it may be appropriate to order time-limited support, as a way to emphasize the positive duty each spouse has under s. 17(7)(d) of the Divorce Act. Alternatively, the court may order a “step-down” in spousal support, often with a termination date at some point in future.
The “step-down” approach is based, in law, on imputing income to the recipient spouse. This, in turn, is based on s. 19(a) of the Federal Child Support Guidelines which provides:
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.
The test is substantially the same under the Spousal Support Advisory Guidelines, and is applied consistently for both child and spousal support claims.
To be “intentionally” under-employed does not require that the reason for the under-employment is to avoid support obligations. “There is no need to find a specific intent to evade child support obligations before income can be imputed”. ‘Intentional’ means a voluntary act and “makes it clear that the section does not apply to situations in which, through no fault of their own, spouses are laid off, terminated or given reduced work hours”.
March 21 – Court of Appeal and Solicitor Lien
“Solicitors have special rights both under statute and at common law to facilitate payment of their client accounts: Edwin G. Upenieks & Robert J. van Kessel, Enforcing Judgments and Orders, 2d ed. (Toronto: LexisNexis Canada Inc., 2016), at s. 8.1. These include both charging orders, under s. 34 of the Solicitors Act, and solicitors’ liens on funds, derived from the court’s inherent jurisdiction: see Halton Standard Condominium Corp. No. 627 v. Grandview Living Inc., 2017 ONSC 1761 (CanLII), at paras. 29-30; Thomas Gold Pettinghill LLP v. Ani-Wall Concrete Forming Inc., 2012 ONSC 2182 (CanLII), 349 D.L.R. (4th) 431, at paras. 84-89.
This takes us to the question of jurisdiction raised by Brown J.A.
A court’s inherent jurisdiction to declare a lien on the proceeds of its own judgments is well-established: Thomas Gold Pettinghill LLP, at para. 89; Re Tots and Teens Sault Ste. Marie Ltd. (1976), 1975 CanLII 535 (ON SC), 11 O.R. (2d) 103 (S.C.), at p. 108; Welsh v. Hole (1779), 99 E.R. 155 (K.B.), at pp. 15556. It follows that this court has the inherent jurisdiction to grant, when warranted, a solicitor’s lien over the $50,000 in costs awarded in favour of the Client on the appeal.
In the light of this conclusion, the question remains as to whether this court has jurisdiction to issue a charging order under the Solicitors Act or a solicitors’ lien over the damages and costs awarded by the Superior Court.
In our view, it does. A judge of the Court of Appeal is, by virtue of his or her office, a judge of the Superior Court with all of the jurisdiction, power and authority of a judge of that court under s. 13(2) of the Courts of Justice Act, R.S.O. 1990, c. C.43, and under s. 134(1) of that Act may make any order or decision that could have been made by the court appealed from. There is no dispute that a judge of the Superior Court has the jurisdiction, both pursuant to s. 34 of the Solicitors Act and, as previously indicated, under the court’s inherent jurisdiction, to grant a charging order or lien on the damages and costs awarded in that court: e.g., Dalcor Inc. v. Unimac Group Ltd., 2017 ONSC 945 (CanLII), 136 O.R. (3d) 585, at para. 14; Thomas Gold Pettinghill LLP, at para. 89. To the extent a Superior Court judge could order a charge or a lien, a Court of Appeal judge is accordingly empowered to do so the same.”
March 20 – Filing Contract With Court Under S. 35 of FLA
“When a contract is filed under s. 35(1) [of the Family Law Act], it is open to a party who wishes to challenge enforcement or an application to vary to raise issues relating to the validity or enforceability of the contract before the court. Where choice of law issues are involved, the validity or enforceability of the contract will be determined according to the law mandated by the choice of law rules in s. 58. Contrary to the father’s submission, s. 35(2) does not provide that a domestic contract containing a provision for support is automatically deemed to be a court order in all circumstances, regardless of its terms. Section 35 simply provides a summary procedure which enables a party to file a contract with the court and to seek enforcement or variation of a provision as if that provision were an order of the court. This procedure allows parties to take advantage of a variety of statutory processes designed to facilitate recovery of support and maintenance payments.
There is nothing in s. 35 that prevents a party responding to enforcement or an application to vary from raising arguments with the court that the contract filed under s. 35(1) is not valid or enforceable. Indeed, it would not make sense that the mere filing of a contract that is invalid or unenforceable would have such an effect.”
March 19 – Principle of Maximum Contact
“Subsection 16(10) of the Divorce Act enshrines the principle of maximum contact with both parents:
[T]he court shall give effect to the principle that a child of the marriage should have as much contact with each spouse as is consistent with the best interest of the child and, for that purpose, shall take into consideration the willingness of the person for whom custody is sought to facilitate such contact.
The principle is important in custody disputes because maximum contact with both parents is usually in the child’s best interests.
Ms. Brand submits that the trial judge did not give sufficient weight to this important principle. I do not agree with her submission. I make three points. First, the maximum contact principle is not an absolute principle; if it were very few relocation requests would ever be allowed. Instead, as this court said in Bjornson v. Creighton (2002), 2002 CanLII 45125 (ON CA), 62 O.R. (3d) 236 (C.A.), at para. 34, though the maximum contact principle is obviously important, “it remains one factor in the whole of the analysis. It ought not to be treated as the governing factor.” And in Gordon v. Goertz, 1996 CanLII 191 (SCC), [1996] 2 S.C.R. 27, still the leading case on mobility, McLachlin J. said at para. 24:
The “maximum contact” principle, as it has been called, is mandatory, but not absolute. The [Divorce Act] only obliges the judge to respect it to the extent that such contact is consistent with the child’s best interests; if other factors show that it would not be in the child’s best interests, the court can and should restrict contact: Young v. Young, 1993 CanLII 34 (SCC), [1993] 4 S.C.R. 3, at pp. 117-18.
Second, the submission that the trial judge did not give sufficient weight to the maximum contact principle is not a basis for appellate intervention. Mobility or relocation decisions are discretionary decisions: Porter v. Bryan, 2017 ONCA 677 (CanLII), at para. 11; and Elliott v. Elliott, 2009 ONCA 240 (CanLII), 247 O.A.C. 174, at para. 19. The exercise of discretion involves the weighing of relevant considerations – here the maximum contact principle. To accede to the submission that an appeal court should intervene because it would have given more weight to a relevant consideration is to abandon discretion altogether. To be justified in interfering, an appellate court would have to be satisfied that the trial judge’s exercise of discretion was unreasonable. See: R. v. McKnight (1999), 1999 CanLII 3717 (ON CA), 135 C.C.C. (3d) 41 (Ont. C.A.), at para. 35; and Ursic v. Ursic (2006), 2006 CanLII 18349 (ON CA), 32 R.F.L. (6th) 23 (Ont. C.A.), at paras. 18-19.”
March 18 – Interpreting Contracts
“In my view, the trial judge did not err by failing to consider Ms. DiDonato’s admissions regarding her understanding of the insurance obligation in the Agreement. In resolving disputes arising from the interpretation of contracts, the objective is to protect the reasonable expectations of the parties, as set out in the language of their agreement. In the absence of ambiguity in the words of the contract, parole evidence of the subjective intention of the parties has no place in the interpretive exercise: see Eli Lilly & Co. v. Novopharm Ltd., 1998 CanLII 791 (SCC), [1998] 2 S.C.R. 129, [1998] S.C.J. No. 59, at paras. 54-56.”
March 14 – Best Interests of The Child
“Section 39 of the Domestic Relations Ordinance provides that the rules of equity will apply in custody matters where they do not conflict with the provisions of the Ordinance. The application of equitable rules in this case would permit the Court to exercise the parens patriae jurisdiction and to treat the welfare of the child as the paramount consideration. I see no conflict in this respect with the Ordinance. Section 37, if it applied in this situation, would itself require a demonstration that the best interests of the child be served before it could be returned to the mother. The rules of equity, therefore, are to be applied in this determination.
This conclusion is consistent with modern authority in this Court and others: see Racine, Beson, and Re Moores and Feldstein. I would therefore hold that in the case at bar the dominant consideration to which all other considerations must remain subordinate must be the welfare of the child. This is not to say that the question of custody will be determined by weighing the economic circumstances of the contending parties. The matter will not be determined solely on the basis of the physical comfort and material advantages that may be available in the home of one contender or the other. The welfare of the child must be decided on a consideration of these and all other relevant factors, including the general psychological, spiritual and emotional welfare of the child. It must be the aim of the Court, when resolving disputes between rival claimants for the custody of a child, to choose the course which will best provide for the healthy growth, development and education of the child so that he will be equipped to face the problems of life as a mature adult. Parental claims must not be lightly set aside, and they are entitled to serious consideration in reaching any conclusion. Where it is clear that the welfare of the child requires it, however, they must be set aside.
In my view, which I find supported in modern authority in this country and in the United Kingdom: see Re Moores and Feldstein; Beson; Racine; and J. v. C., [1970] A.C. 668 (H.L.), and particularly where the governing statute preserves and dictates the application of the rules of equity, the Court in questions of contested custody, including contests between a natural parent and adoptive parents, must consider the welfare of the child the predominant factor and give it effect in reaching its determination.”
King v. Low, [1985] 1 SCR 87, 1985 CanLII 59 (SCC) at 26, 27 and 34