



COURT OF APPEAL FOR ONTARIO

CITATION: Tadayon v. Mohtashami, 2015 ONCA 777

DATE: 20151116

DOCKET: C58382

Gillese, Pepall and Lauwers JJ.A.

BETWEEN

Leila Fatemeh Tadayon

Applicant (Respondent/
Appellant by way of cross-appeal)

and

Ali Mohtashami

Respondent (Appellant/
Respondent by way of cross-appeal)

Stephen Codas and Michael Zalev, for the appellant/respondent
    by way of cross-appeal

Michael Stangarone and Ryan Kniznik, for the respondent/appellant
    by way of cross-appeal

Heard: September 11, 2015

On appeal from the orders of Justice Michael A. Penny of
    the Superior Court of Justice, dated January 23, 2014 and March 14, 2014.

Gillese
    J.A
.:

OVERVIEW

[1]

The appellant, Ali Mohtashami, and the respondent, Leila Tadayon, were
    married in 1984. They separated in 1999 and were divorced in 2004. The parties
    three children were aged 11, 9, and 6 at the time of separation.

[2]

The parties entered into a separation agreement dated October 20, 1999
    (the 1999 Agreement). Among other things, the 1999 Agreement set out how the
    matrimonial home (the Yorkminster Property) was to be dealt with and that the
    appellant would pay the respondent $2,000 per month as combined child and
    spousal support.

[3]

In 2005, the Yorkminster Property was sold and 43 Charnwood Road,
    Toronto (the Charnwood Property) was purchased as a home for the respondent
    and the three children. Title to the Charnwood Property was taken in the
    respondents name alone.

[4]

As a result of the parties changed circumstances, they entered into an
    amending agreement dated March 11, 2005 (the 2005 Amending Agreement). Although
    title to the Charnwood Property was taken in the respondents name alone, the
    2005 Amending Agreement effectively provided that each party had a 50% interest
    in it.

[5]

In 2010, the respondent brought an application in which she sought,
    among other things, to set aside the two agreements, obtain retroactive and
    prospective child and spousal support, and be declared the sole owner of the
    Charnwood Property.  The appellant asserted a claim for a variety of relief,
    including a declaration that the respondent held 50% of the Charnwood Property
    in trust for him.

[6]

At the time that the parties entered into the 2005 Amending Agreement,
    the appellant represented that his income for 2005 was $80,000. However, the
    applications judge found that the appellants 2005 income was actually
    $344,000. The increase in income was largely due to the fact that at the time the
    2005 Amending Agreement was made, in addition to running his own general
    contracting company (Pegah), the appellant was engaged in a home building
    venture from which he earned unreported income.

[7]

The applications judge found that this financial information was highly material
    and had been concealed from the respondent, who had no reason to doubt the
    accuracy of the appellants representation as to his 2005 income. He also found
    that had the respondent known this information, she would not have executed the
    2005 Amending Agreement.

[8]

As discussed more fully below, the applications judge further found that
    the appellants non-disclosure of significant financial income, as well as the
    treatment of the Charnwood Property in the 2005 Amending Agreement, was
    unconscionable.

[9]

The applications judge exercised his discretion under s. 56(4) of the
Family
    Law Act
, R.S.O. 1990, c. F.3 (the 
FLA
) and set aside the 2005
    Amending Agreement. Section 56(4) reads as follows:

A court may, on application, set
    aside a domestic contract or a provision in it,

(a) if a party failed to disclose
    to the other significant assets, or significant debts or other liabilities,
    existing when the domestic contract was made;

(b) if a party did not understand
    the nature or consequences of the domestic contract; or

(c) otherwise in accordance with
    the law of contract.

[10]

By
    order dated January 23, 2014 (the First Order), among other things, the
    applications judge:

·

dismissed the respondents request to set aside the 1999
    Agreement;

·

set aside the 2005 Amending Agreement;

·

declared the respondent to be the sole owner of the Charnwood
    Property;

·

dismissed the appellants claim for overpayment of support prior
    to 2010 and the respondents claim for arrears of support prior to 2010;

·

ordered that the appellants child and spousal support
    obligations for 2010, 2011, and 2012 be recalculated on the basis of: (i) his
    findings that the appellants income for support purposes was $986,450 in 2010,
    $384,500 in 2011, and $445,440 in 2012; and (ii) his determination to impute
    annual income of $48,000

to the respondent for all support purposes after
    December 31, 2009;

·

ordered that no child support was payable to the respondent after
    December 31, 2013; and


·

ordered the appellant to pay the respondent spousal support of
    $7,452 per month for the period January 1, 2014, to December 31, 2015.

[11]

The
    applications judge issued reasons dated March 14, 2014, in which he dealt with
    the costs of the application, as well as the calculation of retroactive child
    and spousal support. In these reasons, the applications judge concluded that
    the respondent should pay costs of $35,915, which was one-half of the costs of
    the two experts reports plus the costs of an unsuccessful pre-trial motion which
    the respondent had brought. Apart from this, because of the parties divided
    success on the application, the applications judge found that each party should
    bear his or her own costs of the application.

[12]

By
    further order dated March 14, 2014 (the Second Order), the appellant was
    ordered to pay the respondent a lump sum of $172,133. That figure is the total
    net amount that the appellant owed for child and spousal support to the end of
    2013, less the costs award of $35,915.

[13]

The
    appellant appeals and the respondent cross-appeals.

[14]

For
    the reasons that follow, I would dismiss the appeal and allow the cross-appeal
    on one matter only, namely, the respondents entitlement to pre-judgment
    interest on the retroactive child and spousal support award.

THE ISSUES

[15]

The
    appellant raises three issues on appeal. He submits that the applications judge
    erred in:

1.

setting aside the 2005 Amending Agreement;

2.

finding the respondent to be the sole owner of the Charnwood Property;
    and

3.

the quantum and duration of the prospective spousal support.

[16]

In
    her cross-appeal, the respondent raises four further grounds of appeal. She submits
    that the applications judge erred in:

4.

failing to order retroactive child and spousal support prior to 2010;

5.

failing to award pre-judgment interest on the retroactive child and
    spousal support order;

6.

time-limiting the spousal support order and the quantification of that
    support; and

7.

his disposition of the costs of the application.

THE APPEAL

Issue #1:     Did the applications judge err in setting aside
    the 2005 Amending Agreement?

[17]

The
    appellant makes three arguments in support of his submission that the
    applications judge erred in setting aside the 2005 Amending Agreement. First,
    he says it was an error for the applications judge to find that the appellant
    failed to disclose a significant asset at the time that the 2005 Amending
    Agreement was made. Second, he contends that the applications judge erred in finding
    the 2005 Amending Agreement was unconscionable. Third, he argues that the
    applications judge erred when he exercised his discretion and set aside the
    2005 Amending Agreement because he failed to have regard to the relevant
    factors, as established in the case law.

[18]

I
    see no merit in this submission or in the arguments advanced in support of it.
    Accordingly, in my view, the applications judge did not err in setting aside
    the 2005 Amending Agreement.

The First Argument

[19]

Did
    the applications judge err in finding that the appellant failed to disclose a
    significant asset when the parties entered into the 2005 Amending Agreement? He
    did not.

[20]

There
    is no question that at the time the parties executed the 2005 Amending
    Agreement, the appellant represented that his income for 2005 would be $80,000.
    He knew at that time that his income for 2004 was $147,000, which is substantially
    in excess of $80,000. He also knew that he would be receiving income from Pegah
    in 2005, and income from his home building venture which he did not declare to
    the Canada Revenue Agency. None of this financial information was disclosed to
    the respondent until long after she began these proceedings.

[21]

One
    of the two income valuation experts was jointly retained by the parties. It was
    she who prepared the first report. That expert gave evidence that the
    appellants 2005 income was $344,000.

[22]

The
    appellant retained the second expert to provide different scenarios as to his
    income, depending on alternative factual findings that the applications judge might
    make. The second expert accepted the first experts report as her starting
    point. She then constructed three possible scenarios for the appellants 2005
    income, which were, at least in part, dependent upon how the unreported income
    was divided between the appellant and his father. It is obvious from his reasons
    that the applications judge preferred the evidence of the first expert, as he
    was entitled to do.

[23]

Further,
    as the appellant acknowledges, the right to an income stream is an asset,
    within the meaning of s. 56(4)(a) of the
FLA
and ought to be disclosed:
    see
Horner v. Horner
(2004), 72 O.R. (3d) 561 (C.A.), at para. 77.

[24]

In
    these circumstances, I see no error in the applications judges finding that
    the appellant failed to disclose a significant asset when the parties entered
    into the 2005 Amending Agreement. Nor do I see any error in the applications
    judges findings that the appellant materially misrepresented his income for
    2005, that the material misrepresentation was an inducement for the respondent
    to sign the 2005 Amending Agreement, and that had the respondent known the
    correct financial information, she would not have executed it.

[25]

To
    the extent the appellant argues that the respondent failed to raise the matter
    of non-disclosure of financial information in her pleadings, I would make four
    responses. First, he did not raise this matter below and it ought not to be
    raised for the first time on appeal. Second, the respondent did plead that the
    2005 Amending Agreement should be set aside.  She pled that she sought
    financial disclosure and, at para. 22 of her pleading, she expressly asked that
    the 2005 Amending Agreement be set aside on the basis of inadequate financial
    disclosure.  Given that, and the parties joint retention of an expert in
    income valuation, it could have come as no surprise that the appellants
    financial situation in 2005 was in issue. Third, the appellant had an
    obligation to make proper financial disclosure at the time the 2005 Amending
    Agreement was entered into: see
Horner
, at para. 77. The respondent can
    scarcely be faulted for the appellants failure to fulfill that obligation. Fourth,
    and in any event, the record shows that by the time this matter was before the
    applications judge, the appellant was fully aware of the case he had to meet
    and was given a fair opportunity to meet that case.

The Second Argument

[26]

Did
    the applications judge err in finding the 2005 Amending Agreement to be
    unconscionable? He did not.

[27]

In
    responding to this argument, both the appellants non-disclosure of significant
    income and the treatment of the Charnwood Property in the 2005 Amending Agreement
    must be considered. Why? Because, in my view, the applications judges finding
    of unconscionability was based on both. I reach this conclusion based on the
    applications judges reasons, at paras. 25-27:

[25] In my view, there were good reasons for the [respondent]
    not to agree to the [2005] Amending Agreement. I find that a material
    inducement to her signing the [2005] Amending Agreement was the representation
    that the [appellants] income was only $80,000. Had she been given the
    information now available to the court (and known by the [appellant] at the time),
    she would not have signed the [2005] Amending Agreement.

[26] I also find the 2005 Amending Agreement, in its treatment
    of the 43 Charnwood property, to be unconscionable. There was, in my view, an
    inequality between the parties, a preying by the [appellant] on the
    [respondent] which, combined with her economic vulnerability, placed upon the
    [appellant] a duty to act with scrupulous care for the [respondents] welfare
    and interests. The [appellants] failure to disclose that his income was
    roughly four times that which he represented it to be was a serious breach of
    that duty.

[27] For these reasons, I find the [2005] Amending Agreement
    was obtained as a result of the [appellants] non-disclosure of material
    financial information and was unconscionable. In the circumstances, I exercise
    my discretion to set the [2005] Amending Agreement aside.

[28]

From
    these reasons, it is also clear that the applications judge understood that the
    concept of unconscionability in the context of the execution of domestic
    contracts is not synonymous with unconscionability as it is understood in the
    common law of contract: see
Miglin v. Miglin
, 2003 SCC 24, [2003] 1
    S.C.R. 303, at para. 82.

[29]

Where
    there are circumstances of oppression, pressure, or other vulnerabilities and
    evidence of one partys exploitation of such vulnerabilities during the
    negotiation process, with the result that the domestic contract deviates
    substantially from the legislation, the contract need not be enforced: see
Miglin
,
    at paras. 81-83; and
Rick v. Brandsema
, 2009 SCC 10, [2009] 1 S.C.R.
    295, at para. 44.

[30]

I
    understand the applications judge to have found that the 2005 Amending
    Agreement was entered into as a result of the appellant having taken advantage
    of the inequality between him and the respondent, and the respondents economic
    vulnerability. This preying upon the respondent was manifested in the appellants
    non-disclosure of significant financial information and the treatment of the
    Charnwood Property itself within the 2005 Amending Agreement.

[31]

I
    dealt with the applications judges findings on financial non-disclosure immediately
    above and there is no need to repeat that analysis, which justifies the
    applications judges finding of unconscionability. I will deal with whether the
    treatment of the Charnwood Property in the 2005 Amending Agreement was
    unconscionable as part of my analysis of Issue #2, below.

The Third Argument

[32]

Did
    the applications judge err in failing to consider the relevant factors when
    exercising his discretion to set aside the 2005 Amending Agreement? He did not.

[33]

In
    determining whether a domestic contract should be set aside pursuant to s.
    56(4) of the
FLA
, the court is to follow a two-step process: see
Virc
    v. Blair et al.
, 2014 ONCA 392, 119 O.R. (3d) 721, at para. 52:

Step 1. Has the party seeking
    to set aside the agreement demonstrated that one or more of the s. 56(4)
    circumstances is engaged?; and

Step 2. If so, is it
    appropriate for the court to exercise its discretion to set aside the
    agreement?

[34]

There
    can be no doubt that the applications judge was alive to this two-step process,
    as paras. 8-10 of his reasons contain an accurate summary of it.

[35]

The
    applications judge also carefully followed that process.

[36]

For
    the reasons already given, it is clear that the applications judge found that
    the first step in the process was met because the appellant had failed to
    disclose to the respondent significant financial assets when the 2005 Amending
    Agreement was made (s. 56(4)(a),
FLA
).

[37]

It
    is equally clear that the applications judge had regard to the relevant
    considerations on the second step.

[38]

In
    addition to the findings made on the first step, findings which led the
    applications judge to conclude that the 2005 Amending Agreement was unconscionable,
    the applications judge also considered the respondents conduct in respect of
    financial disclosure. Although the applications judge noted that the respondent
    could have pursued more detailed disclosure at the time the 2005 Amending
    Agreement was entered into, it is not clear it would have been forthcoming
    without a fight (at para. 15). It is also implicit in the applications judges
    reasons that the respondent took the benefits of the 2005 Amending Agreement
    but, given that the applications judge set that agreement aside, this does not
    factor against the respondent. Further, the applications judge found that the
    respondent had fulfilled her obligations under the 2005 Amending Agreement by paying
    the mortgage and other carrying costs on the Charnwood Property.

[39]

Accordingly,
    I do not accept that the applications judge failed to have regard to the
    relevant considerations when he exercised his discretion and set aside the 2005
    Amending Agreement.

Issue #2:     Did the applications judge err in finding the
    respondent to be the sole owner of the Charnwood Property?

[40]

The
    appellant says that the parties used the net sale proceeds of $120,000 from the
    sale of the Yorkminster Property towards the purchase the Charnwood Property. As
    the Yorkminster Property was jointly owned by the parties, the appellant
    submits that both parties advanced funds to purchase the Charnwood Property. Accordingly,
    he submits, given that title to the Charnwood Property was taken in the
    respondents name alone, the presumption of resulting trust applies. That
    presumption was not rebutted because there was no evidence to suggest that the
    appellant intended to make a gift of his share of the proceeds of sale to the
    respondent. Thus, the appellant contends, he is entitled to a 50% beneficial
    interest in the Charnwood Property.

[41]

The
    full answer to this submission lies in paras. 17-24 of the reasons of the
    applications judge, which can be summarized as follows.

[42]

When
    the matrimonial home (the Yorkminster Property) was sold, the parties had net
    equity available of $257,000. Only half of the net equity ($128,500) went
    towards the purchase of the Charnwood Property. That half belonged to the
    respondent.

[43]

The
    appellant looked after the transaction. The applications judge found that he
    elected to use his half of the net equity from the sale of the Yorkminster
    Property to make a discretionary payment to himself or those he chose to
    confer a benefit upon. He paid $48,500 to Pegah, his construction company, allegedly
    because Pegah made a deposit on the purchase of the Yorkminster Property and
    made renovations on it. The applications judge rejected this, noting that
    Pegahs bookkeeper had testified that the costs of renovations to the
    matrimonial home had been paid by the appellant personally or had been written
    off.

[44]

The
    appellant used the other $80,000 of his share of the net equity to make a
    payment on his fathers home, allegedly because his father had made loans to
    the parties earlier in their marriage. The applications judge did not accept
    that such loans had been made. He found that the allegation of debts owing to
    the appellants father lacked credibility due to an absence of objective
    evidence and the admitted discretion afforded to the appellant in his control
    over his fathers Canadian finances. He described the appellants financial
    relationship with his father as almost entirely undocumented, and explained that
    the father had complete trust in the appellant, with the appellant often treating
    his fathers bank account as if it were his own. The applications judge also
    noted that there was no independent record of amounts loaned to, or owed by,
    the appellant to his father.

[45]

In
    addition to finding that only the respondents funds were used for the down payment
    on the Charnwood Property, the applications judge found the respondent to have
    been entirely responsible for making the mortgage payments and paying the other
    carrying costs on that property. These obligations flowed from the terms of the
    2005 Amending Agreement. The respondent met those obligations from the support that
    she received from the appellant. In the result, the mortgage payments made on
    the Charnwood Property were from funds taxed in the respondents hands for
    which the appellant received a tax deduction. It was in this context that the
    applications judge found the treatment of the Charnwood Property in the 2005
    Amending Agreement, which purported to give the appellant half the net equity on
    its sale, to be unconscionable.

[46]

These
    findings, coupled with the applications judges findings that the appellant
    preyed on the respondents economic vulnerability and that the appellant had
    not disclosed material financial information, satisfy the test for
    unconscionability, set out above.

[47]

As
    for the appellants resulting trust submission, once the applications judge
    found that only the respondents funds were used towards the purchase of the
    Charnwood Property and that only she made payments on the mortgage, there was
    no room for the operation of the presumption of resulting trust.

Issue #3:     Did the applications judge err in the quantum
    and duration of the prospective spousal support?

[48]

The
    appellants submission on this ground of appeal runs as follows. In
Miglin
,
    at paras. 79-85, the Supreme Court of Canada held that when parties execute an agreement
    in the family law context and that agreement is called into question, the court
    must engage in a two-stage inquiry.

[49]

As
    part of the first stage, the court must consider the circumstances in which the
    agreement was negotiated and executed to determine whether there is any reason
    to discount it. As well, the substance of the agreement must be considered so
    that the court can determine whether it is in substantial compliance with the
    objectives of the
Divorce Act
, R.S.C. 1985, c. 3 (2nd Supp.).

[50]

The
    appellant says that the applications judge did not take into consideration the factors
    and objectives set out in the
Divorce Act
, as required by
Miglin
,
    at para. 84. Instead, he says, the applications judge simply ran the
Spousal
    Support Advisory Guidelines
(the SSAGs) and ordered spousal support of $7,452
    per month for an additional two years.

[51]

I
    do not accept this submission.

[52]

The
    applications judge succinctly set out the applicable legal principles when
    considering the respondents claim for ongoing spousal support. At paras. 77-79
    of his reasons, he states as follows:

[77] With respect to spousal support, I am to consider the
    condition, means, needs and other circumstances of each spouse including the
    length of time the spouses cohabited; the functions performed by each spouse
    during cohabitation; and any order, agreement or arrangement relating to
    support of either spouse.

[78] A spousal support order must address the following
    objectives: recognize any economic advantages or disadvantages to the spouses
    arising from the marriage or its breakdown; apportion between spouses any
    financial consequences arising from the care of any child of the marriage over
    and above any obligation for the support of that child; relieve any economic
    hardship of the spouses arising from the breakdown of the marriage; as far as
    practicable, promote the economic self-sufficiency of each spouse within a
    reasonable period of time.

[79] No one objective is paramount and each objective should be
    accorded equal weight. The award of spousal support is ultimately
    discretionary; marriage per se does not give rise to a spousal support
    obligation.

[53]

The
    applications judge carefully considered the issue of entitlement and found that
    even post-separation, the appellant derived a significant benefit from the
    respondents dominant role in childcare. He further found that while the
    respondents role did not prevent her from working at all, it did create some
    limits on what she could do. He weighed the competing factors and ordered a
    further two years of spousal support (from January 1, 2014) to enable the
    respondent to regroup, assess her options, pursue additional job training or
    development and transition to financial self-sufficiency (at para. 90).

[54]

As
    the applications judge noted, his decision in this regard was discretionary. I
    see no basis on which to interfere with the exercise of his discretion.

[55]

As
    for the appellants complaint about the quantum of support ordered, I note two
    things. First, the SSAGs

do not impose a cap on the amount of spousal
    support to be awarded when a payors annual income exceeds $350,000. Second, the
    applications judge set the amount based on the methodology that the appellant
    had proposed for setting retroactive spousal support for 2010-2013. As such,
    the appellant cannot now claim that there is no explanation for how or why the
    applications judge came to the quantum ordered.

THE CROSS-APPEAL

Issue #4:     Did the applications judge err in failing to
    order retroactive child and spousal support prior to 2010?

[56]

I
    see no merit in the respondents claim that the applications judge erred in
    disallowing her claim for retroactive child and spousal support prior to 2010. 
    The respondent argues that the applications judge placed too much emphasis on
    her delay in asserting this claim.  I disagree.

[57]

The
    applications judge found that the respondent had not put forward any credible,
    reasonable excuse for failing to assert those claims before 2010. In making
    this finding, the applications judge noted, among other things, that the
    respondent had sworn an affidavit in 2004, to obtain the divorce, in which she
    indicated that she was content with the terms of the 1999 Agreement with
    respect to support. The applications judge also found that the respondent had
    not provided a basis for such claims. I understand him to be referring to the
    absence of evidence suggesting that either the childrens needs or her needs had
    not been met in the relevant time period.

[58]

In
    these circumstances, it cannot be said that the applications judge erred in
    failing to order retroactive support.

Issue #5:     Did the applications judge err in failing to
    award pre-judgment interest on the retroactive child and spousal support order?

[59]

After
    the applications judge made his findings about the parties respective incomes
    in the relevant years, he asked the parties to calculate the amount of support
    that the appellant owed the respondent. They agreed on that amount ($208,048)
    and sent the applications judge a joint letter (the Joint Letter) to that
    effect. The applications judge used that amount in making the Second Order.

[60]

The
    Second Order did not include an award for pre-judgment interest. The respondent
    had sought such an award in her pleadings and in her written closing
    submissions. She contends that the applications judge erred in failing to make
    the award.

[61]

The
    appellant says that if the respondent had wished to assert such a claim, she
    should have done so at the time the Joint Letter was sent to the applications
    judge.

[62]

In
    my view, the applications judges failure to award pre-judgment interest was an
    oversight. The respondent is
prima facie
entitled to interest on the
    retroactive child and spousal support ordered, pursuant to s. 128(1) of the
Courts
    of Justice Act
, R.S.O. 1990, c. C.43 (the 
CJA
). Furthermore, both the
    respondents pleadings and her written closing submissions indicated that she
    sought pre-judgment interest. I see no basis on which to deny her pre-judgment
    interest on the net amount owing for child and spousal support to the end of
    2013. The Joint Letter responded to the applications judges request for a
    calculation of the amount that the appellant owed the respondent for unpaid
    support over a period of time. It does not specify that pre-judgment interest
    was to be included and neither party viewed it as including such.

[63]

Accordingly,
    I would allow the cross-appeal on this issue alone and order that the respondent
    is entitled to pre-judgment interest on the amount of the retroactive child and
    spousal support.

[64]

Having
    said that, rather than raising this issue by way of cross-appeal, it seems to
    me that when the respondent discovered the error, she ought to have followed
    either of the mechanisms provided by rr. 25(5) and 25(19) of the
Family Law
    Rules
, O. Reg. 426/00,

and disputed the contents of the Second Order
    before the applications judge or moved to have the Second Order changed when
    she discovered the error.


Issue #6:     Did the applications judge err in time-limiting
    the spousal support award and the quantification of that support?

[65]

The
    respondent submits that this court should set aside the applications judges
    determination of post-2009 spousal support on the basis that it is insufficient
    and should not be time-limited.

[66]

An
    appellate court is not to interfere with a support order unless that order is
    based on an error in principle, a significant misapprehension of the evidence,
    or is clearly wrong: see
Hickey v. Hickey
, [1999] 2 S.C.R. 518, at para.
    11.

[67]

As
    I have explained above in my analysis of Issue #3, in making the spousal
    support award for the post-2009 period, the applications judge applied the
    appropriate legal principles to findings that were solidly grounded in the
    evidence. I see no significant misapprehension of the evidence on the part of
    the applications judge and the award is not clearly wrong.

[68]

As
    I did not address the time-limited aspect of the spousal support order above, I
    would simply add the following. The applications judge made clear factual findings
    which fully justify his decision to time-limit further spousal support. Those
    findings include the following:

·

by the time the First Order was made, the respondent had received
    spousal support for some 14 years;

·

the parties separated after 16 years of marriage;

·

the children had grown up and no longer needed the respondents
    full-time care and attention;

·

the respondent was relatively young (she was 37) when the parties
    separated;

·

the respondent was intentionally under-employed;

·

there was no medical or other evidence to suggest that the
    respondent had limited employment opportunities; and

·

evidence of the respondents efforts to achieve financial
    self-sufficiency was lacking.

[69]

Effectively,
    the applications judge found that the respondent was capable of supporting
    herself but had not made reasonable efforts to do so. He ordered two years of
    further spousal support to enable the respondent to regroup, assess her
    options, pursue additional job training or development and transition to
    financial self-sufficiency.

Issue #7:     Did the applications judge err in his disposition
    of the costs of the application?

[70]

Section
    133(b) of the
CJA
provides that leave to appeal is required where an
    appeal is only as to a discretionary costs order. When, however, the
    disposition on appeal changes the decision under appeal, leave to appeal from
    the costs order is not necessary:
St. Jean
(
Litigation Guardian of
)
    v.
Cheung
, 2009 ONCA 9, 173 A.C.W.S. (3d) 984, at para. 4.

[71]

Here,
    since I would allow the cross-appeal on the issue of pre-judgment interest, the
    disposition of the cross-appeal changes the decision below. Thus, it would seem
    that leave to appeal the costs order is not required.

[72]

Nonetheless,
    I would not interfere with the costs award. On a review of that award, I see no
    error in principle and it is not plainly wrong.

[73]

When
    I factor in the change to be made to the Second Order as a result of the
    cross-appeal, I remain of the view that no interference with the costs award is
    warranted. The change arising from the respondents success on the pre-judgment
    interest issue is minor in the overall context of these proceedings.

[74]

Moreover,
    as I have explained above, the respondent could have had the matter of
    pre-judgment interest addressed by the applications judge or on motion. Had she
    done so, it appears likely that no cross-appeal would have been required on
    that particular matter. In these circumstances, I am of the view that the costs
    award below should not be interfered with.

DISPOSITION

[75]

For
    these reasons, I would dismiss the appeal and allow the cross-appeal only on
    the matter of pre-judgment interest. I would amend the Second Order to provide
    that the respondent is entitled to pre-judgment interest on the total amount of
    child and spousal support owed to the end of 2013 by the appellant. If the
    parties are unable to agree on the quantification of the pre-judgment interest,
    they shall return to the applications judge to have that matter resolved.

[76]

I
    would make no order as to costs of the appeal and cross-appeal because, with
    the exception of the matter of pre-judgment interest, success was divided.

[77]

In
    respect of the pre-judgment interest issue, I would make two observations. First,
    that issue occupied a very small part of the cross-appeal (and no part of the
    appeal). Second, as I have explained, had the respondent used either rr. 25(5)
    or 25(19) of the
Family Law

Rules,
it might have been unnecessary
    to have brought the cross-appeal on this matter. With these considerations in
    mind, in my view, no order as to costs of the appeal and cross-appeal is
    warranted.

Released: November 16, 2015 (E.E.G.)

E.E. Gillese
    J.A.

I agree. S.E. Pepall J.A.

I agree. P. Lauwers J.A.


