





CITATION:
Beck v. Beckett, 2011
          ONCA 559



DATE: 20110822



DOCKET: C51887



COURT OF APPEAL FOR ONTARIO



Rosenberg, Moldaver and Feldman JJ.A.



BETWEEN



Brenda Yvette Beck



Appellant



and



Daniel Clifford Beckett



Respondent



Erin L. Reid, for the appellant



Charles S. Morison, for the respondent



Heard: March 15 and 16, 2011



On appeal from the judgment of Justice P. Z. Magda of the
          Superior Court of Justice, dated March 2, 2010 and from the Cost Endorsement
          of Justice Magda dated May 19, 2010.



Rosenberg J.A.:



[1]

Brenda Beck appeals the judgment of Magda J. relating
    to child and spousal support under the
Family
    Law Act,
R.S.O. 1990, c. F.3.  The
    claim for support arises out of the breakdown of a twenty-two year relationship
    between the appellant and the respondent, Daniel Beckett.  The principal issues raised by the appellant
    concern the amount of income imputed to the respondent and the trial judges
    decision to refuse to make an order for lump sum spousal support.  The appellant also seeks leave to appeal the
    costs order made by the trial judge.

[2]

For the following reasons, I would allow the appeal in
    part.

THE FACTS

[3]

The appellant and the respondent began living together
    in 1984.  At the time, she was working at
    Woolco and he was working at General Motors in Scarborough.  The appellant stopped working in 1990 with
    the birth of their first child.  A second
    child was born in 1992.  The appellant assumed
    primary responsibility for the care of the children and left full-time
    employment.  However, she did some
    part-time work at Costco to supplement the family income.

[4]

Although the parties were not married this was in all
    respects a traditional relationship.  The
    appellant took on primary responsibility for raising the children and keeping
    the household.  The familys principal
    source of income was the respondents full-time employment at General Motors,
    first in Scarborough and later at the plant in Oshawa.  He is also a skilled handyman, but did not
    apparently earn any income from this skill.

[5]

The parties separated in September 2006 and the
    respondent began a relationship with another woman.  He now has a young child from this new
    relationship.  When the parties separated,
    the respondent had an annual income from General Motors of almost $73,000.  He had also accrued a substantial
    pension.  The portion of the pension
    attributable to the period of the parties relationship is approximately
    $400,000.  At the time of the separation,
    the appellant was working part-time at Costco and caring for the children.  Her annual income was approximately
    $36,000.  However, due to the stress of
    the separation, she stopped working for a period of four months.

[6]

An important event for the purposes of this appeal is
    the respondents decision to take voluntary retirement from General Motors in
    April 2007 at the age of forty-nine.  The
    respondent received a $70,000 severance package.  He did not seek further employment but rather
    began to live off his pension benefits.  He stayed home to take care of his new child.  The respondents new spouse was laid off from
    General Motors in 2008 and trained as a real estate agent.  To the date of trial, she had only earned a
    nominal income.

[7]

On June 6, 2008, Gonsolus J. made an interim order
    requiring the respondent to pay the mortgage on the parties home and the
    minimum amount required on their line of credit.  He complied with this order.  He did not, however, otherwise pay child or
    spousal support.  In October 2008, the
    parties sold their house for $480,000.  After various deductions, the appellant was paid $125,000.  The respondents share of $126,000 plus
    interest was held in trust pending the outcome of the trial and is still being held
    in trust pending the resolution of this appeal.  After the house was sold, the respondent stopped paying the home
    expenses and continued not to pay child or spousal support.  The appellant and the children moved into a
    new home purchased with the funds from the sale of the parties home and money
    from her mother.  The appellant also
    began to work full time at Costco.

[8]

The trial of this matter was scheduled to proceed in
    May 2009, but was adjourned at the respondents request.  A term of the order of Roswell J. granting
    the adjournment was that the respondent pay child support in the amount of $666.00
    per month based on an imputed income of $73,000.  The trial proceeded in November 2009 in
    Oshawa.  At that time the children were
    19 and 17 years of age and resided with the appellant.  The older child was no longer in full-time
    attendance at school.  He worked at a
    low-paying job and was still supported by the appellant.  At one point after the separation the younger
    child lived with the respondent.  The
    length of time was a matter of dispute at the trial.

[9]

The appellants income in 2009 was $48,118.  She has had some health problems,
    particularly with her eyesight, which have had some impact on her ability to
    work.  The respondents income, from his
    pension, was $41,768.  He also has health
    problems.

THE REASONS OF THE TRIAL JUDGE

Imputed Income

[10]

The trial judge found that the respondent was
    justifiably concerned about the economic future of General Motors in Oshawa and
    was at risk of being laid off for a substantial period of time.  If he was laid off, his income would drop
    below what he would be entitled to from his pension if he took the retirement
    package that was being offered.  The
    trial judge accepted the respondents evidence about these risks and the advice
    he had received, and found that he retired to salvage as much as he could from
    his 30 years of employment with General Motors.  The trial judge rejected the allegation that
    the respondent retired to reduce or avoid his support obligations.

[11]

The trial judge went on to find that the respondent was
    intentionally unemployed in the sense that his unemployment was a voluntary
    act.  Since the respondent had made no
    effort to find any kind of employment to supplement his pension income, the
    trial judge held that some income must be imputed to him.  The trial judge accepted that there is no
    chance that the respondent could again be employed at General Motors or in a
    similar manufacturing job, since such jobs are simply not available.  It was therefore not realistic to impute to
    the respondent the $73,000 he was making at General Motors.  Bearing in mind that he was 53 years of age
    with a Grade 10 education, the most that could be imputed to him was $19,760
    per year for minimum wage work.  Together
    with his pension income, this would bring his income up to $61,528.

Child and Spousal Support

[12]

The appellant sought spousal support and an order for
    lump sum support.  The trial judge found
    that while she was entitled to spousal support, this was not a case for lump
    sum support.  In reaching this conclusion,
    the trial judge considered a number of factors previously identified as
    relevant in determining whether a lump sum support order is appropriate in the
    circumstances:

(1)       Difficulties
    in enforcing periodic paymentsthis was not a concern since the respondent had
    complied with orders to pay.

(2)       The
    possibility that the respondents livelihood will become precariousat least
    for the time being the pension is solid.

(3)       Sufficient
    assets from which to make the lump sumthe only sum available is the
    respondents share of proceeds of the sale of the house, which would not be
    sufficient to meet the award sought by the appellant.

(4)       Risk
    the respondent would leave the jurisdictionthere is no evidence he would leave
    Ontario and he has substantial ties in the area.

(5)       Termination
    of personal contact is desirablethe parties have two sons and so will always
    have some kind of contact and there have been no threats or violence or abuse
    between the parties.

(6)       Disparity
    in incomein fact, the appellants financial situation appears to be healthier
    than the respondents.

(7)       Compensation
    for the appellants lost pension benefitsto make an award on this basis would
    amount to a redistribution of property under the guise of spousal support
    contrary to the holding in
Mannarino v.
    Mannarino
(1992), 43 R.F.L. (3d) 309 (Ont. C.A.).

(8)       To
    provide for the appellants immediate needsthe evidence did not show any such
    need.

(9)       To
    compensate for lost career opportunitiesthe appellant did not lose career
    opportunities; she has worked part-time and now full-time at Costco and is
    probably fully up to her potential; the respondents career did not advance
    during his time at General Motors.

(10)     The
    relationship was of short durationthis was a lengthy common-law relationship
    of over 22 years.

(11)     The
    dependent spouse has established a new relationshiphere it was the payor who
    had established a new relationship.

(12)     To
    effect a retroactive award of spousal supportthe trial judge did not order
    retroactive support to the appellant.

(13)     To
    enable the dependent spouse to discharge a debtthere was no evidence that the
    appellant had any large debts due.

(14)     There
    is little chance of future variationa lump sum award might deprive the
    respondent of the opportunity to apply to vary support in the event of a
    material change in circumstances; there was a real potential for the pension
    income to change in 2015.

[13]

As to support, the trial judge found that the respondent
    should pay child support for the younger child in the amount of $570.00 per
    month.  As a result, the appellant would
    have 54.7 percent of the parties net disposable income.  Accordingly, an additional amount for spousal
    support would be inappropriate.  This
    issue could, however, be revisited once the younger child was no longer
    dependent.

Child Support Credit for the Youngest Child

[14]

As I have indicated, there was some evidence that the
    younger child had lived with the respondent for some of the time after
    separation.  The trial judge found that
    he lived with the respondent for 21 months from May 2007 to March 18,
    2009.  As a result, the respondent was
    entitled to be credited for child support he should have received from the
    appellant in the amount of $7,438.00.  The trial judge deducted $1,140 from that amount for child support for
    the months of April and May 2009, which the respondent did not pay.  This left a net amount of $6,208.

Unjust Enrichment

[15]

In her notice of application, the appellant sought a 50
    percent constructive trust in the respondents pension plan and related
    benefits accumulated during the course of the relationship, or a monetary award,
    on the basis of unjust enrichment.  However,
    she abandoned this claim during the trial.

Costs

[16]

The trial judge found that the respondent was
    successful on the two most contentious issues in the case:  the appellants claim for lump sum spousal
    support and his claim for retroactive child support for the younger child.  The trial judge was also of the view that the
    appellants claim for lump sum support bordered on the unreasonable and her
    claim to impute income to the respondent in the amount of $73,000 per year was
    patently unrealistic and inappropriate.  In his view, the respondent had acted more reasonably throughout.  There was no reason not to apply the
    presumption that costs should follow the event and he awarded the respondent
    costs in the amount of $15,000 inclusive of disbursements and GST.

ANALYSIS

Unjust Enrichment

[17]

As I have said, at the trial, the appellant abandoned
    her claim for a constructive trust over a share of the respondents pension on
    the basis of unjust enrichment.  She did
    not raise the issue in her original Notice of Appeal nor in the two Amended Notices
    of Appeal.  In her factum, dated October
    5, 2010, counsel for the appellant wrote as follows:

It should be noted that while, for reasons
    unexplained, the Appellants counsel did not pursue a constructive trust claim
    against the Respondent in Appeals pension at trial, the Appellant did plead in
    her Application for a monetary award arising from her contributions to the
    pension based upon the principles of a constructive trust.  The Appellant did not amend her Application
    and it was still open to Justice Magda to award this relief.  It is settled law that pension benefits
    accrued during periods of cohabitation may be awarded to common law partners
    either through money judgments or constructive trust remedies.

[18]

At the oral argument of the appeal, the appellant filed
    the decision of the Supreme Court of Canada in
Kerr v. Baranow,
2011 SCC 10 released February 18, 2011.  It was suggested that
Kerr
supports expanded entitlement for a common law spouse to share
    in the assets accumulated during the course of a joint family venture on the
    basis of unjust enrichment.  The
    appellant did not seek leave to amend her Notice of Appeal after the
Kerr
decision was released.  She also did not apply to adduce fresh
    evidence to explain why she had abandoned her unjust enrichment claim.  Aside from the reference in her factum, counsel
    for the appellant only addressed the question of constructive trust and the
    impact of the
Kerr
decision in
    response to questions from the court during the oral argument.

[19]

In my view, it would not be appropriate to consider the
    issue of unjust enrichment at this stage of the proceedings.  The appellant had ample opportunity to
    directly raise the issue at the hearing of the application and by seeking leave
    to amend her Notice of Appeal.  In
    addition, it would be difficult to deal with an unjust enrichment claim at this
    juncture.  Such a claim would have to
    take into account the package of relief granted to the parties, including the even
    division of the proceeds of the sale of their residence, award of child
    support, and the respondents circumstances.  Further, because the unjust enrichment claim was abandoned at trial, the
    trial judge did not make the factual findings necessary to support that claim.  Given that the claim was abandoned at trial, the
    absence of factual findings in relation to the question of unjust enrichment,
    and the fact that the issue was never raised in the Notice of Appeal, we must
    leave the issue of unjust enrichment to the side.

Lump Sum Support

[20]

I have summarized the trial judges reasons for
    refusing to make a lump sum support award.  In
Davis v. Crawford
, 2011
    ONCA 294, a five-person panel of this court revisited the question of lump sum
    spousal support and, in particular, reconsidered the courts earlier decision
    in
Mannarino
, upon which the trial
    judge relied in part.  In
Davis,
the court clarified that lump sum
    spousal support is not reserved only for cases where there is a real risk that
    periodic payments would not be made or other very unusual circumstances.  Rather, s. 34 of the
Family Law Act
confers a broad discretion on judges to make an
    award of periodic or lump sum spousal support as appropriate under the
    circumstances.  That said, at para. 60,
    the court reaffirmed that a lump sum award should not be made in the guise of
    support for the purpose of redistributing assets.  This is the issue for which the trial judge
    made reference to
Mannarino
.

[21]

The court discussed at paras. 60  76 of
Davis
a number of considerations as relevant
    to the question of the propriety of a lump sum spousal support award. One
    important consideration is whether the payor has the ability to make a lump sum
    payment without undermining the payors future self-sufficiency. The court
    explains that there is a need to weigh the perceived advantages of making a
    lump sum award in the particular case against any presenting disadvantages, and
    that the advantages and disadvantages of making such an award will be highly
    variable and case specific. The court identified a number of these advantages
    and disadvantages at paras. 67 and 68, most of which were referred to by the
    trial judge. The court noted that as a practical matter, most spousal support
    orders will be in the form of periodic payments. But, a lump sum award will not
    necessarily take the place of periodic support and can be made to supplement an
    award of periodic support.

[22]

The standard of review of a support order is set out in
Davis
at para. 77.   This
    court should not overturn a support order unless the reasons disclose an error
    in principle, a significant misapprehension of the evidence, or unless the
    award is clearly wrong.  In my view,
    there is no basis for interfering with the trial judges decision refusing to
    award lump sum support.  The trial judge
    did not approach the issue on the basis that such an award is reserved for
    exceptional cases.  He considered almost
    all of the factors identified by this court in paras. 67 and 68 of
Davis
and found that the overwhelming number
    of those factors told against a lump sum award.

[23]

The appellants principal submission on this issue was
    that there was a real risk that the respondent would not comply with an award
    of periodic support payment.  She points
    to two factors to support this submission.  First, the respondent did not pay a costs order made by Roswell J. and
    second, that he did not made the child support payments ordered by the trial
    judge.  I do not accept this
    submission.  The costs order was
    relatively small and pending trial, the respondent had otherwise complied with
    court orders.  The fresh evidence
    tendered by the appellant does show that the respondent was not making the
    child support payments ordered by the trial judge.  Counsel for the respondent explained that the
    respondent did not have sufficient funds to pay child support because his share
    of the proceeds from the sale of the house remain in trust, and his only income
    is from his pension.  Given the history
    prior to trial, once the respondent has access to the funds that have been
    sitting in trust since 2008, it is reasonable to believe it will not be
    difficult to enforce a periodic support order.

[24]

Admittedly, the trial judge might have weighed some of
    those factors differently.  I would not
    have attached much significance to the fact that the appellant was seeking an
    award that would exceed the amount available from the respondents share of the
    proceeds from the sale of the house.  As
    indicated, a lump sum award will not necessarily take the place of periodic
    support and can be made to supplement an award of periodic support. However, this
    was but one of the factors considered by the trial judge and on the evidence,
    it was open to the trial judge to refuse to make the lump sum award.

Spousal Support

[25]

While the trial judge held that the appellant was
    entitled to spousal support, he refused to make such an order having regard to
    the order for child support and the relative incomes of the parties.  Again, I cannot say that this decision was
    unreasonable or reflects an error in principle.  The factors the court is to take into account in deciding whether to
    award spousal support are set out in s. 33(9) of the
Family Law Act
.  A review of
    those factors supports the trial judges decision, including the parties
    current assets and means, the assets and means they will have in the future,
    the appellants capacity to contribute to her own support and the respondents
    capacity to provide support.

[26]

On his findings of fact, it was open to the trial judge
    to conclude that this was not a case for spousal support on the basis of the
    compensation principle.  As indicated,
    the trial judge found that the appellants earning capacity was not affected by
    the nature of the relationship and the parties decision that she would leave
    full-time employment.  This finding was
    open to the trial judge.  The only
    opportunity that the appellant may have lost as a result of her part-time
    rather than full-time employment was an employment pension.  The trial judge, however, made no findings in
    support of this conclusion.

[27]

The appellant submits that the order for spousal
    support should take into account the fact that she is not entitled to a share
    of the respondents General Motors pension.  However, this overlooks the context of this case.  As I will explain, I would make an order for
    spousal support retroactive to November 2010.  As a practical matter, this spousal support will likely be paid out of
    the respondents pension.

[28]

The trial judge expressly left open the possibility
    that the appellant could apply for spousal support once the respondent was no
    longer obligated to pay child support for the youngest child.  We were informed at the hearing of the appeal
    that the youngest child is no longer a dependant as of November 2010.  Rather than require the parties to return to
    the Superior Court to vary the judgment, I would vary the judgment to eliminate
    the order for child support and replace it with an order for spousal support as
    of December 2010 at the rate of $433 per month; this amount stands at the
    mid-range of the
Spousal Support Advisory
    Guidelines
(Ottawa, Department of Justice, 2008):
Fisher
    v. Fisher
(2008), 88 O.R. (3d) 241 (C.A.).

Imputed Income

[29]

The appellant submits that the trial judge erred in
    only imputing income to the respondent on the basis of minimum wage unskilled
    employment.  She submits that the trial
    judge should have imputed income to him in an amount comparable to what he was
    earning at General Motors as was done in the interim order of Roswell J. when
    the trial was adjourned.  The parties
    adduced no evidence, aside from their own testimony, about employment prospects
    in the Oshawa area.  In those
    circumstances, this court must defer to the trial judges view of what amount was
    reasonable to impute to the respondent.  In fact, the appellants own evidence tended to support the trial
    judges conclusion.  The only employment
    opportunities she was aware of that might suit the respondent were at stores
    like Canadian Tire and Home Depot, which, while hiring employees, were offering
    only the minimum wage or maybe a little bit more.

[30]

In
Drygala v.
    Pauli
(2002),
61 O.R. (3d) 711 (C.A.) at para. 45, Gillese
    J.A. reviewed the factors to be considered in imputing income to a parent who
    is intentionally under-employed or unemployed:

When imputing income based on intentional
    under-employment or unemployment, a court must consider what is reasonable in
    the circumstances. The factors to be considered have been stated in a number of
    cases as age, education, experience, skills and health of the parent. See, for example,
Hanson, supra
, and
Cholodniuk
    v. Sears
(2001), 14 R.F.L. (5th) 9, 204 Sask. R. 268 (Q.B.). I
    accept those factors as appropriate and relevant considerations and would add
    such matters as the availability of job opportunities, the number of hours that
    could be worked in light of the parent's overall obligations including
    educational demands and the hourly rate that the parent could reasonably be
    expected to obtain.

[31]

The trial judge considered most of these factors, in
    particular the respondents age, education, experience, skills and health and the
    little evidence there was on the availability of employment in the area.  I have not been persuaded that there is any
    basis for varying the order imputing income to the respondent.

Retroactive Child Support

[32]

The resolution of this issue at trial turned on where
    the younger son, was living following separation.  The appellant claimed that he was living with
    her throughout the relevant period and therefore she was entitled to
    retroactive child support.  There was
    conflicting evidence on the issue, which the trial judge resolved against the
    appellant.  Having found that younger son
    was living with the respondent for a period of 21 months, the trial judge
    ordered the appellant to pay retroactive child support to the respondent.  Unfortunately, the trial judge failed to take
    into account that the older son was living with the appellant for the entire
    time post-separation (when he was still a dependant) and that both children were
    living with the appellant for some periods of time.  In fairness to the trial judge, it is not at
    all clear that this particular issue was raised at the trial as clearly as it
    should have been.

[33]

Counsel for the respondent conceded that if these other
    issues were taken into account, the appellant would not owe the respondent any
    retroactive child support.

[34]

One final issue is that, as we have noted, the
    respondent has not made any child support payments in accordance with the trial
    judges order.  The child support
    payments that should have been made should therefore be paid out of the funds
    currently held in trust before the funds are released to the respondent.  The amount of spousal support retroactive to
    November 2010 will also be paid from the trust funds.

COSTS

[35]

The appellant also seeks leave to appeal the costs
    order made by the trial judge.  As
    indicated, the trial judge found no reason to interfere with the normal rule
    that costs should follow the event.  The
    principal issues at the trial were lump sum spousal support and imputing
    income.  The appellant was unsuccessful
    on the lump sum support issue but successful on the issue of whether the
    respondent was deliberately unemployed, although the amount of income imputed
    to him was less than was sought by the appellant.  She sought to impute income equivalent to the
    respondents income at the time he retired from General Motors.  The trial judge characterized the appellants
    position on this issue as patently unrealistic.  In my view, this was an error in principle.  Just a few months earlier, Roswell J. had
    made an order imputing $73,000 in income to the respondent.  The appellant, who had a similar background
    to the respondent, had been able to obtain employment with an income of almost
    $50,000.  The trial judge found as a fact
    that the income should be imputed to the respondent only at the rate of minimum
    wage, but the appellants position could not properly be described as patently
    unreasonable.  This should not have been
    a factor in fixing costs of the trial.  I
    would grant leave to appeal the costs award, and having regard to the divided
    success at trial I would order that the parties bear their own costs of the
    trial.

DISPOSITION

[36]

Accordingly, I would allow the appeal in part as
    follows:

·

The order for child support is terminated as of
    November 30, 2010.

·

The respondent shall pay to the appellant
    spousal support as of December 1, 2010 in the amount of $433 per month.

·

Term 4 of the Order requiring the appellant to
    pay child support arrears is deleted.

·

Term 9 of the Order is varied to require that
    arrears of child support and spousal support payable by the respondent shall be
    paid out of monies held in trust before the funds are released to the
    respondent.

[37]

I would grant leave to appeal costs, allow the appeal
    and order that there be no costs of the trial.  Similarly, given the divided success on the appeal, I would make no
    order for costs of the appeal.

RELEASED:

MR                                                  Marc
    Rosenberg J.A.

AUG 22 2011                                I
    agree M.J.
Moldaver
J.A.

I
    agree K. Feldman J.A.


