


COURT OF APPEAL FOR ONTARIO

CITATION:
Edgar v. Edgar, 2012
    ONCA 646

DATE: 20120927

DOCKET: C52572

Weiler and Sharpe JJ.A., and Mackinnon J. (
ad
    hoc
)

BETWEEN

Jennifer-Lynn Edgar

Applicant (Appellant)

and

Jeffrey Robert Edgar

Respondent (Respondent in Appeal)

Peter Callahan, for the appellant

Ian Mang, for the respondent

Heard and released orally: September 7, 2012

On appeal from the judgment of Justice Gisele M. Miller
    of the Superior Court of Justice, dated July 6, 2010.

ENDORSEMENT

[1]

At the conclusion of oral hearing, we advised counsel that a written
    endorsement would be released in due course and would include these terms:

·

The trial judge erred in failing to impute any income to the respondent
    from February 2008 to August 2009;

·

Income of $30,000 per annum is imputed to the respondent as of
    February 1, 2008 to and including August 1, 2009;

·

The spousal support awarded to the respondent in the sum of
    $28,000 was not a lump sum rather a calculation of periodic spousal support
    payments due to him in the specified periods of time;

·

If the parties are unable to agree upon the recalculation of the
    amounts owing between them arising from the imputation of income, the dispute
    is referred back to the trial judge for determination;

·

The costs awarded below are set aside and there will be no costs
    of either the trial or of this appeal.

Background

[2]

The parties married February 2, 2002 and separated October 1, 2007.  The
    only issues in the trial below were child support, spousal support, and whether
    to base these amounts on the respondents actual income or on an imputed
    income.  The trial judge imputed an annual income of $30,000 from August 25,
    2009 onward.  The appellant asked this court to set aside the trial judgment
    and instead impute a salary equal to the full amount the respondent earned
    before he left his job in October 2007 ($62,458.).

[3]

Both parties worked full-time during the marriage. However, upon
    separation, the respondent took a leave of absence from his job and received
    short-term disability benefits equivalent to 100 percent of his salary until
    the end of January 2008.  The respondent failed to take advantage of various
    forms of income replacement including employer benefits, CPP, EI and ODSP. His
    explanations for these failures ranged from complete oversight to
    procrastination. The respondent had not applied for any jobs since the date of
    separation.  In 2008, and again in 2009, the respondent was ordered, on
    consent, to attend for an independent medical examination at the appellants
    expense.  He did not do so and she did not pursue the matter.  The respondent
    produced a letter from his doctor in 2008 indicating that he was incapable of
    working due to anxiety and depression.

[4]

The trial judge expressed concern over the lack of medical evidence of
    the respondents inability to work but noted that the appellant did not compel
    him to attend for a medical exam despite having two orders allowing her to do
    so.  The trial judge concluded that the respondent was not able to resume his
    former employment but was capable of some less taxing form of employment.  She
    concluded that he would be capable of earning $30,000 and imputed this amount
    from August 25, 2009 onward.  The trial judge found that from February 2008,
    when the respondent stopped receiving disability benefits, to August 2009, the
    respondent was incapable of resuming his prior employment, inhibited in his
    ability to seek other employment, and in need of support which the appellant
    was capable of providing.  Applying the
Spousal Support Guidelines
,
    the trial judge found that the respondent was owed $28,000 in spousal support
    and applied that amount as a credit to the respondents ongoing child support
    obligations.

The Period Prior to August 25, 2009

[5]

At paras. 50 and  51, the trial judge stated:

Despite the lack of medical evidence, I accept that Mr. Edgar
    was, for some time, incapable of working as a result of his anxiety and
    depression. It is clear, however, that while his condition may prevent him from
    resuming his former employment, he is either able to undertake some less taxing
    form of employment or he is so ill that he would qualify for disability
    benefits which would also assist in providing health care benefits to the
    children.

I am not satisfied, on the evidence before me, including my own
    observations as to Mr. Edgar's capabilities, that he continues to be incapable
    of earning some income. I am satisfied that it is his own inaction - but not an
    inability to act - which has resulted in Mr. Edgar's current unemployment. I am
    satisfied this has been the case from at least as early as August 25, 2009 when
    by final order of this Court the primary residence of the children was with
    Mrs. Edgar.

[6]

We see no reason to interfere with the trial judges conclusion to
    impute income to the respondent in the amount that she did as of August 25,
    2009.

[7]

In our view, the trial judge ought to have considered whether she
    should impute an income to the respondent prior to that date.  The trial judge
    referred to evidence showing that the respondent knew that long-term disability
    was available to him after January 2008.  She noted that the respondent
    testified that his employer had told him it would reinstate his sick pay upon
    confirmation from a doctor that he was unable to work.  She also found that he
    was aware of CPP benefits but had not followed through with his application for
    them.  Nor had he applied for ODSP.  The trial judge also referred to his
    failure to follow through with an application for Employment Insurance.  On
    this evidence, it was error not to have considered whether income should have
    been imputed to him prior to August 2009 based on these available sources.  In addition,
    the trial judge had evidence before her that, in 2009, the respondent withdrew
    $20,000 to $30,000 from his RRSP account.  The trial judge did not consider
    whether that was income for support purposes.

[8]

The appeal proceeded without a transcript of the trial evidence.  The
    appellant did not challenge the findings of fact made by the trial judge and
    submitted that, based on those findings, this court could determine whether
    there was an error of law.  If so, the appellant asked the court to go on to
    impute income to the respondent based on the trial judges findings.

[9]

The record before us establishes that had the respondent proceeded in a
    reasonable way at least $15,000 annually was available to him through Canada
    Pension.  He could have received that amount for 11 months in 2008, and for eight
    months in 2009.  It does not appear from the reasons that the respondent led
    any evidence as to the amount of long-term disability that would have been
    available to him from February 2008 had he completed his application for it in
    a timely way.  We also know that the respondent had RRSP income between $20,000
    and $30,000 in 2009, but there is no indication that he could not have taken some
    or all of that in 2008.  The trial judge also found that the respondent was
    capable of earning $30,000 annual employment income from August 2009 forward.

[10]

The
    various sources of income available to the respondent commencing from February
    2008 and the actual and imputed sources available to him in 2009 are evident in
    the unchallenged reasons of the trial judge.  Having regard to those facts and
    in preference to sending the matter back for a new trial, we have imputed an
    annual income of $30,000 to the respondent commencing from February 1, 2008 to
    and including August 1, 2009.  This amount is consistent with the minimum
    sources of income known to have been available to and withdrawn by the
    respondent during the period from February 2008 to August 2009 that were not
    included in the trial judges imputation of income. The trial judgment is
    amended accordingly, necessitating a recalculation of the amounts of child and
    spousal support payable between the parties.

Spousal Support

[11]

The
    trial judge calculated arrears of periodic payments based on the
Spousal
    Support Advisory Guidelines
.  She went on to provide that the credits due
    to the respondent for spousal and child support were to be set off against his
    obligation to the appellant for ongoing child support.  The appellant submitted
    that the trial judge had thereby erred in failing to have regard to the
    different income tax treatments applicable to child support and spousal
    support.

[12]

The
    tax treatment arises by virtue of the
Income Tax Act
which is not
    susceptible to change by court order.  The fact that the periodic payments are
    quantified at a point in time and that a set off is ordered by the court as a
    collection mechanism does not change the nature of the underlying legal character
    of the periodic spousal support payments.: see
C.(Y.J.) v. C.(Y.D.)
(2001), 56 O.R. (3d) 150; 150 O.A.C. 247 (C.A.) and
Sills v. Minister of
    National Revenue
, 1984 CarswellNat 514.  Consequently, the fact that the
    trial judge did not explicitly discuss the inherent income tax law implications
    of an award of spousal support was not unreasonable nor was it an error.  This
    ground of appeal is dismissed.

Result

[13]

Income
    at the rate of $30,000 annually is imputed to the respondent effective February
    1, 2008 to and including August 1, 2009.  If the parties are unable to agree on
    the recalculation of the amounts owing between the parties for child and
    spousal support, the matter is referred back to the trial judge for
    determination.  The recalculation should assume that no other changes would be
    made to the judgment other than with respect to the income imputation.

[14]

The
    costs award below is set aside.  Given the divided success, there will be no costs
    of the trial or of the appeal.

K.M.
    Weiler J.A.

Robert
    J. Sharpe J.A.

J.
    MacKinnon J. (
ad hoc
)


