



COURT OF APPEAL FOR ONTARIO

CITATION: Jonas v. Pacitto, 2020 ONCA 727

DATE: 20201112

DOCKET: C66537

Hourigan, Trotter and
    Jamal JJ.A.

BETWEEN

Laszlone Jonas

Applicant (Appellant)

and

Carlo Pacitto

Respondent (Respondent)

Matthew Tubie, for the appellant

Brigitta Tseitlin, for the respondent

Heard: October 14, 2020 by videoconference

On appeal from the order entered
    on December 21, 2018 by Justice Ronald P. Kaufman of the Superior Court of
    Justice, with reasons reported at 2018 ONSC 7720.



Trotter J.A.:

Introduction

[1]

Ms. Jonas and Mr. Pacitto married in 2003. They filed for divorce in
    2016. Prior to their marriage, they executed a Marriage Contract; it provided
    that, upon dissolution of the marriage, neither party would be entitled to the
    property of the other, and Ms. Jonas waived any right to claim spousal support.

[2]

The trial judge determined that the Marriage Contract was valid and
    binding as it applied to the division of property. However, he found that Ms.
    Jonas financial circumstances at the time of trial warranted some award of spousal
    support. He ordered Mr. Pacitto to pay Ms. Jonas a lump sum payment of $40,000.
    He also made a $25,738.34 costs award against Ms. Jonas.

[3]

On appeal, Ms. Jonas argues that the trial judge erred by failing to
    invalidate the Marriage Contract in its entirety. She also appeals the quantum
    of the lump sum award.

[4]

For the reasons that follow, I would allow the appeal in part. In my
    view, the trial judge erred in his assessment of the quantum of spousal support.
    He ordered minimal support based on Ms. Jonas annual income of $15,564, and
    Mr. Pacittos declared annual income of $24,226, but failed to attribute appropriate
    income from Mr. Pacittos residential real estate holdings, worth almost $5
    million at the time of trial.

Background

[5]

When they married, Ms. Jonas was 42 and Mr. Pacitto was 66. At trial
    they were 57 and 80, respectively.

[6]

Ms. Jonas came to Canada from Hungary as a refugee claimant in 2001. She
    was married and had three adult children. Mr. Pacitto, who immigrated to Canada
    from Italy in 1958, was married to his first wife for 40 years, until she
    passed away in 2000.

[7]

Mr. Pacitto acquired a number of properties while married to his first
    wife, including a number of houses on the street where he lived. He rented one
    of them to Ms. Jonas and her family. Mr. Pacitto also had a property in Bolton
    that he sold sometime before the trial.

[8]

Eventually, Ms. Jonas first husband returned to Hungary in 2002 and they
    divorced. Ms. Jonas and Mr. Pacitto commenced a relationship. She moved into
    his home. The parties entered into a Cohabitation Agreement on January 15
th
,
    2003, in which they waived any entitlement to each others property, owned
    either prior to, or purchased during, their cohabitation. This Agreement was
    silent on the issue of support.

The Marriage Contract

[9]

The parties married on August 15
th
, 2003. The Marriage
    Contract was dated August 6
th
, 2003. The parties provided different
    versions of how the Marriage Contract came into existence.

[10]

Ms.
    Jonas testified that, as the wedding day approached, she was still a refugee
    claimant, with an appeal outstanding. On August 3
rd
or 4
th
,
    2003, Mr. Pacittos daughter, Clara, presented the Marriage Contract to Ms.
    Jonas. Ms. Jonas testified that she signed the Marriage Contract that day in
    front of Mr. Pacitto and Clara in the matrimonial home. Nobody else was with
    them. Ms. Jonas said that Mr. Pacitto and Clara told her that, if she did not
    sign the document, there would be no wedding. According to Ms. Jonas, Clara
    further implied that Ms. Jonas would have to return to Hungary if she did not
    sign.

[11]

Ms.
    Jonas testified that, on August 16, 2003, the day after the wedding, she took
    the Marriage Contract to Ms. Judi Simms, a paralegal that she knew from her
    refugee proceedings. Ms. Simms explained the contents of the document and told
    Ms. Jonas that she should not have signed it because it was unfair, but it was
    too late to do anything about it.

[12]

Mr.
    Pacitto and Clara gave different accounts. Mr. Pacitto could not recall signing
    the document, explaining that it was years ago. However, he recalled discussing
    the contract with Ms. Jonas and advising her to get it translated and signed.

[13]

Clara
    testified that the Marriage Contract was not signed in the matrimonial home.
    Instead, on August 6
th
, 2003, she and her father went to see their
    lawyer, Mr. William A. Harrison. Mr. Pacitto signed the Marriage Contract and
    Mr. Harrison witnessed his signature. Mr. Harrison gave copies of the document
    to Clara to have Ms. Jonas sign, with explicit instructions to tell Ms. Jonas that
    she should get independent legal advice before signing the document. Clara subsequently
    gave four copies of the Marriage Contract to Ms. Jonas and told her to take
    them to a lawyer.

Marriage Contract Documentation

[14]

The
    documents relating to the execution of the Marriage Contract support Mr.
    Pacittos position at trial. The Marriage Contract itself, dated August 6
th
,
    2003, was signed by the parties and duly witnessed. Each page bears the
    initials of the parties and their respective witnesses.

[15]

Four
    other documents are relevant to the execution of the Marriage Contract. The
    first document is the Certificate and Affidavit of a Solicitor, Mr. Harrison,
    sworn on August 6
th
, 2003, in which he certified that he provided
    independent legal advice to Mr. Pacitto and that he was a subscribing witness
    to the document.

[16]

The
    second document is the Affidavit of Laszlone Jonas, sworn on August 11
th
,
    2003, in which she states:

1.

I am Laszlone Jonas named in
    the Marriage Contract and hereby decline independent legal advice.

2. I read over the Marriage Contract
    the contents of which were explained to me in the Hungarian Language with all
    the legal implications and ramifications and obligations and rights therein and
    I am satisfied that I fully understand the provisions of the said Marriage
    Contract and the implications therein.

Ms. Simms commissioned this affidavit.

[17]

The
    third document is the Affidavit of Irene Zusmanov, sworn on August 11
th
,
    2003. The affidavit states:

I, Irene Zusmanov, was personally present of (sic) the 11
th
day of August, 2003 as a subscribing witness and did see the annexed Marriage
    Contract executed by Laszlone Jonas and that it appeared to me that she was
    executing the said Marriage Contract of her own volition, without fear,
    threats, compulsion or influence from the man or any other person.

[18]

The
    last document is a Translators Declaration, signed by Anna Maria Fekete and
    dated August 8
th
, 2003, which was annexed to the Marriage Contract.
    The document provides:

I, the undersigned Anna Maria Fekete, hereby attest and swear
    that to my best of knowledge and ability this is a true and accurate
    translation of the original document. I am well acquainted with both the
    English and the Hungarian languages.

[19]

At
    her Questioning before the trial, Ms. Jonas acknowledged that she had met both Ms.
    Zusmanov and Ms. Fekete.  However, in her trial testimony, Ms. Jonas denied any
    knowledge of the person who witnessed her signature, or the person who translated
    the document for her.

Subsequent Events

[20]

After
    the parties married, Mr. Pacitto sponsored Ms. Jonas to become a permanent
    resident, which happened in 2006.

[21]

Ms.
    Jonas contended that she was treated poorly during the marriage. She says Mr.
    Pacitto forced her to work for him, to prepare his meals, clean his house and
    the other houses he rented out, as well as to generally help him around his
    properties. Mr. Pacitto denied any such exploitation.

[22]

The
    parties separated and reconciled three times during their marriage. The first
    time they reconciled, on December 10
th
, 2005, they entered into an
    agreement whereby Ms. Jonas would receive a monthly sum of money and a promise
    that, if Mr. Pacitto passed away while they were together, she would receive
    $50,000. After the next two reconciliations (which occurred on February 4
th
,
    2012 and March 5
th
, 2015), the quantum of the bequest increased to
    $100,000, and then to $200,000. There were competing accounts of how Ms. Jonas
    and Mr. Pacitto reached these terms each time; however, these agreements
    increasingly accrued to Ms. Jonas benefit.

The Trial Judges Findings

[23]

The
    trial judge provided Reasons for Decision in which he thoroughly examined the
    circumstances surrounding the execution of the Marriage Contract. Given the
    competing accounts between Ms. Jonas, on the one hand, and Mr. Pacitto and
    Clara, on the other, he was required to make credibility findings.

[24]

The
    trial judge provided detailed reasons for rejecting Ms. Jonas evidence on
    major issues. He relied on: inconsistencies between Ms. Jonas trial evidence and
    her testimony at Questioning; the Marriage Contract and accompanying execution
    documents; and Ms. Jonas failure to call witnesses that were critical to her
    account (i.e., Ms. Simms, Ms. Zusamanov, and Ms. Fekete).

[25]

The
    trial judge made the following critical findings. He found that Ms. Jonas
    signed the Marriage Contract at the lawyers office where Ms. Simms worked as a
    paralegal. Someone from the same law office translated the document for her and
    another person properly witnessed it. He rejected Ms. Jonas evidence that she
    signed the Marriage Contract at the family residence.

[26]

The
    trial judge found that Ms. Jonas signed the Marriage Contract before the
    wedding, not afterwards. He accepted that Ms. Jonas was told that, if she did
    not sign the contract, there would be no wedding. However, based on Ms. Jonas
    own testimony, she was indifferent about returning to Hungary.

[27]

In
    terms of the lack of independent legal advice, the trial judge made the
    following finding, at para. 118:

On an assessment of all of the evidence placed before this
    court, it is my finding that although the applicant did not see a lawyer that
    was a choice she chose to make Judi Simms was an employee of a law firm. She
    was known to the applicant. Her advice, as a paralegal was that the contract
    should not be signed as it was unfair to the applicant. Based on my evidentiary
    findings, at that point in time, the applicant had options she chose not to
    pursue.

[28]

The
    trial judge rejected Ms. Jonas claim that she received deficient legal advice
    from a paralegal because the matter was outside the scope of the paralegals
    expertise. As the trial judge said at para. 119: There is no evidence that Ms.
    Simms offered any advice other than the contract should not be signed. If
    anything, it should have impressed upon Ms. Jonas that she should seek
    independent legal advice from a lawyer. In any event, the trial judge noted
    that the absence of legal advice will not automatically vitiate a marriage
    contract: see
Dougherty v. Dougherty
, 2008 ONCA 302, 89 O.R. (3d) 760,
    at para. 11. The trial judge found that Ms. Jonas understood what she was
    agreeing to but nevertheless decided to sign the contract and proceed with the
    marriage.

[29]

In
    deciding how much weight to give the Marriage Contract, the trial judge applied
    the framework from the leading case of
Miglin v. Miglin
, 2003 SCC 24, [2003]
    1 S.C.R. 303. He made the following findings, at para. 123:

Despite the fact that neither party was proficient in English,
    I find that the conditions in which the contract was negotiated, while not
    perfect, pass the initial stage of inquire [sic] required by the Supreme Court
    in
Miglin
.
In doing so I am mindful of all of the allegations of
    circumstances of oppression, pressure or other vulnerabilities argued before me
    as well as the absence of negotiations in the execution of the contract
.
    [Emphasis added.]

[30]

The
    trial judge found that, from a property perspective, the Marriage Contract was
    consistent with the objectives of the
Divorce Act
, R.S.C. 1985, c. 3
    (2nd Supp.). Mr. Pacitto wished to protect the property he acquired before Ms.
    Jonas came into his life, for the benefit of himself and his family.  The trial
    judge found that: It is evident that the respondents net wealth has grown
    solely due to the increase in the value of his property but not as a result of
    any efforts from the applicant.

[31]

The
    trial judge made an alternative finding. At para. 146 of his reasons, he said
    that, if he was wrong about the enforceability of the Marriage Contract as it
    relates to property, Mr. Pacitto would owe an equalization payment to Ms. Jonas
    of $2,466,258.17.

[32]

However,
    applying the second stage of the
Miglin
analysis, the trial judge
    decided to award spousal support notwithstanding the waiver in the Marriage
    Contract,  pursuant to s. 33(4) of the
Family Law Act
, R.S.O. 1990, c.
    F.3. He held that Ms. Jonas financial circumstances at the time of trial
    warranted an award of spousal support:
Scheel v. Henkelman
(2001), 52
    O.R. (3d) 1 (C.A.). Although the agreement was fair and reasonable when entered
    into, the trial judge found that the circumstances changed such that it was no
    longer fair. Ms. Jonas was dependent upon Mr. Pacitto for her sustenance, as
    reflected in the reconciliation agreements referred to above.

[33]

Based
    on the filings of the parties, the trial judge determined that Ms. Jonas
    annual income was $15,564, whereas Mr. Pacittos was $24,226. At trial, Ms.
    Jonas submitted that, for the purposes of support, the court should impute an
    annual income of $250,000 to Mr. Pacitto, entitling her to monthly support
    payments of $4,167. This submission was based on an assertion that a
    construction company once owned by Mr. Pacitto generated substantial revenue.
    The trial judge found, at para. 132: There is no evidence, whatsoever, on
    which this court can accept that submission.

[34]

The
    trial judge also rejected Ms. Jonas submission that he should impute additional
    income to Mr. Pacitto from the properties he owned, explaining at para. 133:

The applicants income is $15,564.00 according to her financial
    disclosure submitted to the court. The respondents income is declared at
    $24,226.00. The court heard evidence of rental income received from the rental
    of 174 and 180 Weldrick as well as for a large portion of 176 where the
    respondent resides in the lower or two basements.
This issue was not fully
    explored by the applicant in cross-examination of the respondent. It leaves the
    court in a difficult position of determining the respondents income. The court
    cannot speculate on what the precise income of the respondent is in the absence
    of evidence received at trial. The court also cannot speculate as to the
    expenses of maintaining the realty taxes and mortgages on the subject properties.
[Emphasis added.]

[35]

Based
    on the financial information before him, the trial judge calculated that
    support should be paid indefinitely in the range of $127-$170 per month. This
    resulted in the $40,000 lump sum award to Ms. Jonas.

Discussion

[36]

At
    the oral hearing of the appeal, counsel for Ms. Jonas did not challenge the
    trial judges factual findings, including his credibility assessments. Instead,
    based on the facts as found, she submits that: (1) the Marriage Contract was
    invalid in its entirety; and (2) the quantum of support was inadequate.

(1)

The Marriage Contract

[37]

In
    terms of the validity of the Marriage Contract, Ms. Jonas submits that, on the
    facts before him, the trial judge should have found that she satisfied the
    requirements

to set aside the contract in its entirety. She contends
    that the trial judge failed to give sufficient weight to all relevant
    considerations. In particular, a combination of factors  including her lack of
    proficiency in the English language, the lack of independent legal advice, her economic
    dependency on Mr. Pacitto, and the prospect of having to return to Hungary 
    created vulnerabilities that undermined the validity of the Marriage Contract.
    Ms. Jonas further submits that the trial judge failed to take into account the
    fact that the Marriage Contract was not negotiated; instead, it was imposed
    upon her.  Lastly, she contends that the trial judge placed too much weight on
    the execution documents discussed above.

[38]

Ms.
    Jonas position cannot succeed based on the trial judges findings. He
    addressed each of the issues raised on appeal. Ms. Jonas bore the burden of
    proof required to set aside the Marriage Contract and she failed to adduce
    sufficient evidence to satisfy that burden.

[39]

As
    noted above, the trial judge did not find that Ms. Jonas was vulnerable to the
    extent that it undermined the agreement she entered into. He found that she
    made a number of choices, including not to seek legal advice from a lawyer.

[40]

Although
    Ms. Jonas claims that the Marriage Agreement was imposed upon her, there was no
    evidence that she attempted to negotiate a more favourable arrangement. The
    reconciliation agreements that Ms. Jonas entered into with Mr. Pacitto are
    relevant to this issue. Although the validity of these agreements was never in
    issue in this litigation, they did have evidentiary value at trial. As already
    noted above, they were increasingly beneficial to Ms. Jonas. It is some
    evidence that she was capable of asserting her interests with Mr. Pacitto,
    albeit later on in their relationship.

[41]

Ms.
    Jonas places great weight on the fact that she was vulnerable because of her
    refugee status. As noted above, she faced the prospect of deportation if she
    did not get married, and she could not get married without signing the Marriage
    Contract. However, her own evidence undercuts this proposition: she was
    indifferent about returning to Hungary.

[42]

Ms.
    Jonas submits that the trial judge placed too much weight on the documents that
    pertained to the execution of the Marriage Contract. However, this amounts to a
    challenge to the trial judges factual findings.  A trial judges findings
    of fact, including credibility assessments, are entitled to substantial
    deference on appeal, especially in family law cases:
Rados v. Rados
,
2019
    ONCA 627, 30 R.F.L. (8th) 374, at para. 23. In any event, the trial judge
    relied on the documents as he did because Ms. Jonas failed to call (or attempt
    to call) the witnesses that were critical to her position  Ms. Simms, Ms.
    Zusmanov, and Ms. Fekete. As he said, at para. 101: In the absence of any
    other credible evidence, the court must rely upon the documents themselves.

[43]

The
    trial judge was entitled to find that Ms. Jonas declined to obtain legal
    advice, even after Ms. Simms advised her not to sign the Marriage Contract. She
    had been put on notice that the agreement might be unfair but decided not to do
    anything about it. Moreover, the trial judge was entitled to find that the
    document had been translated properly. Indeed, Ms. Jonas acknowledged that she
    was shocked when she learned that she would receive nothing if the marriage ended,
    thereby demonstrating her knowledge of the contents of the document. Ms. Jonas
    said she realized this after the wedding, when it was too late. The trial judge
    rejected this evidence and found that the appellant knew ahead of time.

[44]

The
    trial judges overall finding that Ms. Jonas made a series of choices around
    the time that she signed the Marriage Contract  choices that did not undermine
    the validity of the agreement  is supported by the evidence. I would decline
    to intervene.

(2)

The Spousal Support Order

[45]

Ms.
    Jonas challenges the trial judges award of spousal support as inadequate. She
    disputes the trial judges calculation of income. As part of his declared
    annual income, Mr. Pacitto included a modest sum for rental income. As he did
    at trial, counsel for Ms. Jonas contended that the trial judge ought to have imputed
    further income from Mr. Pacittos properties. As noted in para. 34 above, the
    trial judge addressed this issue, pointing to the paucity of evidence in
    support of this submission.

[46]

Although
    appellate courts should afford deference to the support orders made by trial
    judges (see
Ballanger v. Ballanger
, 2020 ONCA 626, at paras. 22-23),
    the unique circumstances of this case require intervention by this court. The
    trial judges dissatisfaction with the record before him was understandable.
    However, both parties must share the responsibility for this state of affairs. 
    Although Ms. Jonas had the onus of demonstrating why income should be imputed
    to Mr. Pacitto, and in what amount, Mr. Pacitto was required to make proper
    disclosure of all sources of income, but failed to do so.

[47]

Section
    6 of the
Spousal Support Guidelines
provides that the starting point
    for determining income for spousal support purposes is the definition of income
    under the
Federal Child Support Guidelines
, SOR/97-175: see
Slongo
    v. Slongo
,
2017 ONCA 272, 137 O.R. (3d) 654, at para. 130. Section
    19(1)(e) of those
Guidelines
provide that the court may impute income
    where the
"spouses property is not reasonably
    utilized to generate income". Although the imputation of income is
    discretionary, in my view, the facts of this case cry out for this to be
    considered.

[48]

In
    his lengthy reasons, the trial judge devoted just a few paragraphs to the issue
    of quantum of spousal support. Quite rightly, he said, at para. 134:
"The court should not be required to generate its own evidence
    upon which to determine a case. This is especially relevant when examining the
    large quantum of support being sought by the applicant." At the same time,
    the onus was on Mr. Pacitto, not Ms. Jonas, to provide complete information
    about his assets, as well as his income.


[49]

In all of the circumstances, it was an error for the trial judge not
    to at least consider imputing additional income to Mr. Pacitto. After all, this
    was a fairly long marriage. Ms. Jonas worked hard on the
    home-front  cooking, cleaning, doing laundry, and cleaning the
    respondent's residential properties  while those
    properties increased significantly in value, to nearly $5 million at the
    time of trial.

[50]

Mr. Pacitto is over 80 years old and may reasonably
    be able to generate significantly more income from his properties, beyond that
    included in his declared income of $24,226. Ms. Jonas, on the other hand, has
    no real employment prospects and an annual income that would appear to be below
    the poverty line:
see
Statistics Canada,
Low income cut-offs
    (LICOs) before and after tax by community size and family size, in constant
    dollars
"
(Table 11-10-0195-01) (Ottawa:
    Statistics Canada, 2020), online: Statistics Canada <
https://doi.org/10.25318/1110019501-eng
>
.
Now aged 60, she
    will be in need of support for many years to come.

[51]

Because
    of the time that has passed between the trial and the hearing of this appeal,
    which has been almost three years, this court is not well-positioned to decide
    this matter afresh. Accordingly, I would remit this case back to the Superior
    Court of Justice for a focused hearing on the imputation of income to Mr. Pacitto
    for the purposes of calculating the award of spousal support. Both parties must
    provide that court with current property evaluations as well as income
    statements.  Given the passage of time, this hearing should take place on an
    expedited basis, subject to local judicial resources.

Conclusion and Disposition

[52]

I
    would allow the appeal in part and remit the case to the Superior Court of
    Justice in accordance with these reasons. Given that success on appeal has been
    divided, I would make no order as to costs.

Released: CWH November 12, 2020

Gary Trotter J.A.

I agree. C.W. Hourigan J.A.

I agree. M. Jamal J.A.


