Bianchin v. Bianchin

2010 BCSC 295 Bianchin v. Bianchin

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Bianchin v. Bianchin, 2010 BCSC 295 Date: 20100309 Docket: ED037841 Registry: Nanaimo Between: Wayne Richard Bianchin Plaintiff And Mary Virginia Bianchin Defendant Before: The Honourable Mr. Justice Halfyard Reasons for Judgment Counsel for the Plaintiff: S.L. Dick Counsel for the Defendant: R. C. Doell Place and Date of Hearing: Nanaimo, B.C. February 18, 2010 Place and Date of Judgment: Nanaimo, B.C. March 09, 2010 The Applications [1] This is an application by the plaintiff, Wayne Richard Bianchin, for review of the order of Lander J. made by consent on February 1, 2005, in so far as it relates to the quantum of spousal support. If that application is successful, the plaintiff seeks an order cancelling arrears of spousal support in whole or in part. The plaintiff asks that any reduction in spousal support be made retroactive to March 1, 2009. [2] The defendant, Mary Virginia Bianchin, has filed a cross application in which she seeks orders that the Family Maintenance Enforcement Program use monies garnished from the plaintiff to pay the defendant an amount equivalent to the arrears of spousal support and that the FMEP be authorized to hold the remainder of that money as security for future payments of spousal support to her. The Application for Review [3] Paragraph 8 of the order of Lander J. required the plaintiff to pay

$3,500 per month to the defendant for spousal support, on a permanent basis, from February 14, 2006, onward, until further order of the court. The order further provided that the defendant could demand a further $500 per month upon proof that she was engaged in a formal program of education or training and was not earning more than $2,000 per month. Paragraph 6 of the order declared that the plaintiff's guideline income for the purposes of child support was $175,000, and required the plaintiff to pay child support for the daughter of the parties in the amount of $1,239 per month. [4] By its terms, the order provided that the amount of spousal support could be reviewed on a material change of circumstances or in any event on February 1, 2009. The review was to be by way of mediation in the first instance. The order also identified four matters that would not constitute a material change of circumstances that could justify a reduction in spousal support, namely: a) Income earned by the defendant from all sources, up to $3,000 per month; b) Income earned by the defendant from employment up to the sum of $2,000 per month; c) Continued payment of child support to the defendant; or d) Any inheritance received by the defendant. The Grounds of the Application [5] The plaintiff concedes that the defendant is entitled to continued spousal support, but says that the amount should be

reduced from $3,500 per month to $1,600 per month, retroactive to March 1, 2009, and that all arrears ($1,900 per month x 12 months) should be cancelled. It is alleged that the plaintiff's annual income for spousal support purposes should be set at $70,000 and that $25,000 income should be imputed to the defendant. The plaintiff brings his application as of right, in that it was commenced after February 1, 2009. Moreover, he alleges that there has been a severe reduction in his ability to pay spousal support and that this change constitutes a material change within s.17(4.1) of the Divorce Act. [6] The main facts alleged by the plaintiff in support of his application are these: a) His gross income for 2009 was only $80,911, whereas it was about $175,000 when the order was made on February 1, 2005. b) He paid all spousal support required by the order, up to and including February 2009. c) Since March 1, 2009, he has paid the defendant $1,500 per month. d) The parties were unable to settle this issue by mediation, which began in March 2009 and extended into the fall of 2009, when negotiations broke down. e) He paid $14,400 to their daughter Brittany in 2009, to cover her educational expenses. f) His employer now requires him to pay a special levy to cover added staffing costs, which will amount to $20,916 per year. g) The defendant has failed to make reasonable efforts to become

self sufficient. The Position of the Defendant [7] The defendant challenges the plaintiff's case on two issues. First, she denies that there has been a reduction in the plaintiff's income that has reduced the income available to pay spousal support to such an extent that it justifies a reduction of spousal support. Second, she denies that she has failed to make reasonable efforts to become self sufficient. [8] Before considering these issues, I will briefly outline the background facts which appear to be undisputed. Background Facts [9] The parties were married on September 2, 1977, in Pittsburgh, Pennsylvania. They had two children, a son who is now 28, and a daughter who is now 24. The parties separated in 2002 after 25 years of marriage. They were divorced by the order made on February 1, 2005. [10] The plaintiff is now 56 years of age. He lives and works in Nanaimo. Since 1983, he has worked as a financial planner, and since 1995 he has worked for the same employer. Before embarking on that career, the plaintiff played professional hockey, which included a few seasons in the National Hockey League. A back injury ended his hockey career, and he has also incurred a serious injury to his neck. [11] The defendant is now 55. She lives in Pittsburgh, Pennsylvania and it appears that her daughter, Brittany, lives with her, and is attending university in Pittsburgh. Up until the

time the parties separated, the defendant worked for many years as a receptionist-hostess for the same employer as her husband, and mainly worked for him. She was also the parent mainly responsible for caring for the children and managing the household. However, the plaintiff mainly controlled the financial matters of the parties. [12] The defendant has not worked full time at any job, since the separation of the parties. Nor has she taken any program of educational or occupational training except for flight attendant training for a month or so in Pittsburgh. She has had several part-time jobs and has deposed in her affidavit sworn January 25, 2010, that she has made continuous efforts to find and secure regular employment. She has some history of working in the air travel industry. It appears that she is in good health. [13] As a result of the settlement reflected in the consent order of February 1, 2005, each of the parties received assets having an approximate net value of $500,000. The plaintiff now has assets having a value of about $1,395,000, but he has debts of about $1,051,000, so that his net asset value is presently about $344,000. He also has a newly assessed income tax debt of $17,000. [14] The defendant received the former family home in Nanaimo as a result of the settlement. She sold that property and moved to Phoenix, Arizona and purchased a property there. She

had to sell that property, and incurred a loss of about $9,000 in doing so. She then moved back to Pittsburgh, where her family lived. Brittany, of course, accompanied her to Phoenix and to Pittsburgh. The defendant purchased a townhouse in Pittsburgh, where she and Brittany are living. She says that she will have to sell this property, because she cannot afford the mortgage payment. Her net equity position with respect to her assets has decreased to just over $164,000. The defendant says that she has had to spend capital of $117,900 to pay for expenses during the period from 2006 to 2009. [15] The plaintiff's obligation to pay child support for Brittany ended some time ago. At What Amount should the Plaintiff's Income be Set? [16] The evidence indicates that the plaintiff's income has been as follows: Year Amount 2005 $176,467 2006 $169,720 2007 $156,605 2008 $130,731 2009 $80,910 [17] The income amounts specified for the four years from 2005 to 2008 are taken from the plaintiff's income tax returns, and do not appear to be in dispute. There is no income tax return available as yet for 2009, but the method used to calculate the $80,910 appears to be the same method used to calculate the plaintiff's income for previous years. [18] Counsel for the plaintiff submitted that the plaintiff's income for 2009 should be further reduced from $80,910 down to $70,000, for two main

reasons. The first is that the plaintiff incurred employment expenses of about $24,000 which were necessary for him to earn his income. The second is that the plaintiff's employer has imposed an annual levy against him in the amount of $20,916 per year. [19] Counsel for the defendant argued several preliminary points which were said to detract from the reliability of the plaintiff's evidence generally. Mr. Doell first complained that the plaintiff failed to provide a complete financial statement, in that notices of assessment and reassessment for income tax for the past three years were not attached. It was also said that the plaintiff's financial statement was not current. While I think there is some merit to these complaints, the fairly detailed evidence given by the plaintiff and the affidavit evidence given by Arlene Vass (legal assistant to the plaintiff's counsel) sworn February 16, 2010, persuade me to treat these specific deficiencies in the plaintiff's financial statements as irregularities. In my opinion, they do not justify an adverse inference being drawn against the plaintiff. [20] Mr. Doell referred to a number of inconsistencies between the plaintiff's financial statements sworn March 4, 2009, and July 27, 2009. At paragraph 42 of her affidavit No. 6, the defendant has prepared a comparison of numerous items in the two financial statements, to illustrate the

differences. I do not intend to itemize them, but I do conclude that there are inconsistencies in the amounts specified for several of the same expenses, assets and debts. [21] There is no explanation given in the evidence for these discrepancies, some of which are significant. Some of them might be excused as honest mistakes, or due to actual changes between March 4, 2009, and July 27, 2009. But I think the unexplained differences indicate that estimates given by the plaintiff should be treated with caution. That conclusion is supported to some extent by the difference between the plaintiff's estimates of his income for 2009 in March and July, which were $40,000 and $40,000 to $50,000 respectively, and his actual claimed income of $80,910. [22] Counsel for the defendant contended that the evidence given by the plaintiff on his examination for discovery on September 30, 2009, shows that he had not followed through with his earlier professed intention (in his affidavit sworn July 7, 2009, at paragraph 27) to sell his house and pay off his mortgage so as to cut down his expenses. It was also said that the plaintiff had unwisely failed to pay down his debts with the large inheritance he received from his mother's estate. Counsel suggested that the plaintiff was carrying an increased but unnecessary debt load so as to inflate his expenses and reduce the amount of money available to

pay spousal support. It was additionally pointed out that the plaintiff had failed to list his "book of clients" as an asset in his financial statements, when it had been valued at $233,000 at the time of the settlement. [23] Admittedly, the plaintiff has made some unwise choices in spending his money, but he says he is hopeful that he can weather the storm and maintain his assets. He is entitled to change his mind about selling his assets, and time will tell whether he will be able to maintain them. The plaintiff explained his failure to include his book of clients as an asset by deposing that he considers it to have little or no present value. He could be right, but there is no expert evidence to support his estimate. [24] The plaintiff estimates that his employment expenses for 2009 for income tax purposes will be approximately $24,000. It should be noted that the employment expenses claimed by the plaintiff on his income tax returns for 2005 through 2008 were significantly reduced after reassessment (see the letter dated February 10, 2010 from Canada Revenue Agency to the plaintiff, attached as an exhibit to the affidavit Arlene Vass). For example, the plaintiff claimed employment expenses of $34,580.52 in 2007, but that was reduced to $22,295.26. His claim for 2008 was reduced from $33,354.05 to $27,040.73. [25] I would also make the observation that the two items of

employment expense which have been consistently the highest, are those related to motor vehicle expenses and education expenses. In my opinion, it can reasonably be inferred that there is a fairly large component of personal benefit to the plaintiff, in these expenses. [26] With respect to the new levy imposed on the plaintiff by his employer, the plaintiff deposed on July 7, 2009, that he would be required to pay $20,916 by the end of December 2009. However, as it turned out, he was only required to pay $5,250 in 2009. The letter from the plaintiff's employer dated March 4, 2009, includes the statement that "this amount will be reviewed quarterly, and adjusted accordingly, based on Mr. Bianchin's ongoing production." I conclude that there is considerable uncertainty in the plaintiff's evidence at paragraph 19 of his affidavit sworn February 10, 2010, to the effect that he will have to pay the full $20,000 in 2010. In the result, I conclude that the plaintiff's estimate of his employment expenses for 2009 may not be reliable. [27] Mr. Doell made a further argument based on the evidence that the plaintiff received gross commissions totalling $193,952 in 2009. Counsel pointed out that this figure was far higher than the commissions reported by the plaintiff in his 2008 income tax return, namely, $130,972 (see the plaintiff's financial statement sworn July 27, 2009, at page 22).

It was argued that both of these figures represented gross commissions received by the plaintiff in the two years, 2009 and 2008 respectively. If counsel's argument is correct, then it would be obvious that the plaintiff had earned far more money in 2009 than he had earned in 2008. [28] While the numerous documents relating to the commissions earned by the plaintiff are not free of all confusion, I think Mr. Doell's argument on this point is incorrect. It seems to me that the "total gross" amounts shown on the pay advice statements issued by the plaintiff's employer refer to the portion of the total commissions that are actually received by the plaintiff. In reaching this conclusion, I have reviewed all the available documents. I also note that the valuation report of Chris J. Goodburn, dated October 21, 2004 (Exhibit J to the affidavit of the defendant sworn January 25, 2010) includes the statement: Mr. Bianchin receives between 40% and 42% of gross commissions, from which he deducts the costs of running his office not paid by Nesbitt Burns. Those expenses are mainly employee costs. [29] The amount of $80,910 is just under 42% of $193,952 and seems consistent with Mr. Goodburn's assessment. I conclude that the amount that will eventually be shown at Line 101 of the plaintiff's 2009 income tax return will be about $80,910, and that this figure represents a substantial reduction

in his employment income. I do not agree with the submission that the plaintiff's income should be reduced to $70,000. I think the issue is whether it should be increased above $80,910. [30] Counsel for the defendant pointed out that the plaintiff no longer has a legal obligation to pay child support for Brittany but claims that he paid $14,400 for her education expenses in 2009. It was argued that this should be considered money available to the plaintiff, to pay spousal support. I agree with this submission. [31] Counsel for the defendant argued that the expenses claimed by the plaintiff as rental expenses in relation to the Sproat Lake property are, in effect, "an investment in his capital asset." The evidence shows that the plaintiff has been receiving only about $14,000 to $16,000 in rental income for the Sproat Lake property, but was claiming large amounts for expenses which resulted in net income losses. The letter from Canada Revenue Agency dated February 10, 2010, allowed these losses in the following amounts: Year Amount 2005 $36,547 2006 $19,903 2007 $34,358 2008 $20,028 [32] I accept that the plaintiff has been able to use these losses to his benefit as an income tax deduction. [33] Counsel for the defendant made a further argument which I took to be in the alternative to his submission that there had been no substantial reduction in the plaintiff's income. The

submission was that the plaintiff should be required to utilize capital assets acquired after the date of the order, to enable him to continue making spousal support payments of $3,500 per month. Reliance was placed on the judgment of the Supreme Court of Canada in Leskun v. Leskun 2006 SCC 25. At paragraph 29 of that judgment, it was stated, in effect, that after-acquired capital assets could properly be found to be part of the "means" of the payor spouse. The court accepted the definition of "means" to include "all pecuniary resources, capital assets, income from employment or earning capacity, and other sources from which the person receives gains or benefits." [34] In the present case, the plaintiff has substantially increased his capital assets since February 1, 2005. However, he has also increased his debts, with the result that his net equity position has decreased from the time of the order. Accordingly, I am not prepared to find that the plaintiff has been receiving "gains or benefits" from his after-acquired assets beyond the income tax benefits I have discussed. The plaintiff acknowledges that he has spent much money unwisely. If he is forced to sell some of his assets, and if he profits from such sale, he may have to account to the defendant at a later date. Likewise, if he earns income from his after-acquired assets in the future, that will have to be accounted for

as well. [35] Counsel for the defendant made an argument that, in effect, amounted to: The defendant has had to use her capital assets to support herself because the plaintiff reduced his monthly spousal support payment, and therefore the plaintiff should be required to use his assets, if it is necessary, to continue paying the full $3,500 per month. There is some force to this argument. But Mr. Doell bases this submission, in part, on paragraphs 37 and 53 of the defendant's affidavits. At paragraph 53, Mary Bianchin deposes that she has used up $117,904.47 of an investment since 2006. The thrust of her evidence on this point was that the $3,500 per required by the consent order was not enough to pay her living expenses. [36] No doubt the plaintiff's unilateral reduction of spousal support created further financial difficulty for the defendant. But there was no basis for the implication that the plaintiff's reduction in payments of $2,000 per month beginning in March 2009, for one year, "forced" the defendant to cash in almost $118,000 of her capital investment. She had been using capital since 2006, and I do not see how the plaintiff can be blamed for that. [37] Having regard to all of the financial circumstances of the plaintiff, I find that his income should be set at $100,000 for the purposes of paying spousal support. Should a Higher Income be Imputed to the

Defendant? [38] Section 96(4) of the Family Relations Act requires a recipient of spousal support to "make reasonable efforts to become self sufficient," and ss.(5) empowers the court to reduce the amount of spousal support if it is found that the "former spouse is not making reasonable efforts." Counsel for the plaintiff pointed out that the defendant has earned only minimal incomes, as follows: Year Income from Employment Total Income 2006 $9,039 2007 $5,349 $13,142 2008 $9,578 $13,778 2009 $9,578 [39] It was argued that the defendant is in good health and is not saddled with any childcare responsibilities, yet she has failed to obtain full-time work and has failed to undertake any significant program of education or retraining, notwithstanding that the parties have been separated for almost eight years and the settlement was concluded five years ago. Furthermore, the defendant has dissipated her assets to a considerable extent. It was contended that if the defendant is in financial need, then, for the most part, she is to blame. Counsel for the plaintiff emphasized that the defendant has grade 12 standing, some college courses and many years experience in working at a brokerage office up to early 2002. Ms. Dick referred me to previously-decided cases where income was imputed to a former spouse. Those cases included Moniz v. Moniz 2008 BCSC 1109; Bryant v. Gordon 2007 BCSC

946; McEachern v. McEachern 2006 BCCA 508; Winsemann v. Donaldson 2007 BCSC 1322; and Bockhold v. Bockhold 2009 BCSC 130. [40] The plaintiff also invokes s.19(1)(a) of the Guidelines, which authorizes the court to impute income to a spouse where the spouse is intentionally under employed or unemployed. The Position of the Defendant [41] Counsel for the defendant referred to the evidence given by the defendant at paragraphs 28 to 34 of her affidavit, which describes the efforts she has made to obtain regular employment. It was argued that the court could not decide against the defendant on this issue unless it first rejected the evidence of the defendant, and it was contended that there was no basis upon which this could be done without an assessment of the defendant's credibility. Discussion [42] The defendant has failed to earn any significant income from employment since the spousal support order was made. Nor has she undertaken any job training courses, other than the flight attendant training which lasted for about a month, until the defendant learned that she would have to travel away from Pittsburgh in order to obtain employment in that line of work. The defendant is in good health and has no child raising responsibilities. She was regularly employed until early 2002. It may be arguable that these facts could support the inference that the defendant has failed to make

reasonable efforts to become self sufficient, even if the defendant's evidence (to the effect that she has made constant and diligent efforts to obtain regular employment) is accepted. While I think the question is a close one, I am not persuaded that the inference sought by the plaintiff should be drawn in the face of the facts asserted in the defendant's affidavit evidence. In the result, I am not satisfied that the defendant has failed to make reasonable efforts to become self sufficient and accordingly, I would not impute additional income from employment to the defendant. Should there be a Reduction in Spousal Support, and if so, to what extent? [43] I find that the plaintiff has established that there has been a substantial reduction in his income from employment since the fall of 2008. I am further satisfied that this decrease in employment income constitutes a material change in the plaintiff's ability to pay spousal support. [44] The defendant is entitled to ongoing spousal support on compensatory grounds and I am satisfied that she has also proven that she is in financial need at the present time. Mr. Doell has referred me to a number of cases which set out the established principles that apply to the issues of entitlement, quantum and duration of spousal support. Recent case authority indicates that an application for review should be considered as a fresh

application, not subject to proof of a material change in circumstances and governed by s.15.2 of the Divorce Act. See J.M. v. L.D.M. 2008 BCSC 1235 at paragraphs 3 - 5; Moniz v. Moniz 2008 BCSC 1109 at paragraph 6; and Bockhold v. Bockhold 2009 BCSC 130 at paragraph 15. [45] In the circumstances of this case, I think s.15.2(6) of the Divorce Act is most important and that the relevant parts of that statute are the following: (6) An order . . . that provides for the support of a spouse should a) Recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown; b) . . . c) Relieve any economic hardship of the spouses arising from the breakdown of the marriage; and d) In so far as practicable, promote the economic self sufficiency of each spouse within a reason period of time. [46] The defendant suffered economic disadvantage on the breakdown of her marriage to plaintiff, in that she lost the financial support that he had always provided and she was not well equipped to earn a good income independently of the plaintiff's business. She was approaching 50 years of age. Her efforts to obtain regular employment have thus far failed and she remains in need. There is a chance that she may yet achieve economic self sufficiency, but that possibility does not appear strong at this stage. In my opinion, the amount of spousal support should be as

near to $3,500 per month as the plaintiff can reasonably be required to pay. [47] Considerable argument was directed to the question of the extent to which the Spousal Support Advisory Guidelines should be applied to determine the appropriate quantum of spousal support. I do not think these guidelines have direct application in the circumstances of this case for several reasons including the fact that the order permits the defendant to earn up to $2,000 per month from employment, without triggering any reduction in the amount of spousal support to be paid. I found the judgment of Madam Justice Lynn Smith in J.M. v. L.D.M. 2008 BCSC 1235, at paragraphs 68 - 73, to be most instructive on this issue. [48] The SSAG would indicate a range of spousal support from $2,750 to $3,667 per month, where the payor spouse has an income of $100,000 and the recipient spouse has an income of $12,000. The facts of an individual case must govern the ultimate result. Having regard to the particular facts of this case, it is my opinion that the plaintiff should be required to pay spousal support in the amount of $3,000 per month. This reduction of $500 per month will be retroactive to March 1, 2009. I note that the plaintiff gave notice of his request for a review well in advance. There was considerable delay in completing the process, but I would not fault the plaintiff for it. Delay seems inherent

in this kind of litigation. Should there be a further review of spousal support? [49] There is uncertainty as to whether the defendant will obtain regular employment and if so, whether she will earn in excess of $2,000 per month. Her efforts to obtain full-time employment or retraining are not impressive. There is also considerable uncertainty as to what income the plaintiff will be able to earn in the future. In these circumstances, I have decided that there should be a review of this order in two years. Accordingly, either party may apply for review on or after March 1, 2012. Of course, an application could be made at an earlier date, upon proof of a material change in circumstances. [50] The mediation undertaken in 2009 appears to have been a waste of time and money. Accordingly, it will not be necessary for the parties to mediate before making an application for variation or review. But there will be an obligation on both parties to provide ongoing disclosure of information relating to income and employment. I am going to leave it to the parties to agree on the content of that term of the order, with liberty to apply in the event of a dispute that cannot be resolved. [51] The order will be that, commencing March 14, 2009, the plaintiff shall pay to the defendant spousal support in the amount of $3,000 per month, continuing on the 14th day of every month thereafter until

further order of the court. Paragraph 8(a)(iii) of the order of Lander J. will be changed to show the new date of March 1, 2012, for review and to delete the requirement for mediation. There will be a new term to provide for the exchange of financial information. The other relevant parts of the order of Lander J. relating to spousal support will remain the same, but should be reproduced in the new order, which should stand on its own. Should the arrears of spousal support be cancelled or reduced? [52] I have reduced the spousal support retroactive to March 1, 2009. The plaintiff has only been paying $1,500 per month for the past 12 months, so that arrears of 12 months x $1,500 = $18,000 have accumulated. Except for the plaintiff's argument that he ended up paying double spousal support in the amount of $12,584 in 2004 and/or 2005, there would appear to be no basis for reducing the amount of arrears. The plaintiff's evidence on this issue is contained in paragraph 16 of his affidavit sworn July 7, 2009, and in paragraph 4 of his affidavit sworn February 10, 2010. The defendant's evidence on the subject is contained in paragraph 40 of her affidavit. [53] The evidence shows that the FMEP assessed the plaintiff as being $12,584 in arrears as of June 14, 2004, when they became involved (Exhibit E to the affidavit of the defendant). The FMEP statement identified the arrears as being

$22,089.27 after the payment of $1,500 was made on January 14, 2010. [54] The plaintiff deposes that he paid cheques to the defendant on the dates and in the amounts as follows: Date Amount March 15, 2004 $571.60 March 15, 2004 $1,380.00 April 14, 2004 $3,000.00 May 14, 2004 $3,862.00 June 14, 2004 $2,962.00 Total $11,775.60 [55] The defendant does not specifically deny receiving the payments alleged by the plaintiff. But she does rely on the assessment of arrears as calculated by FMEP, and asserts that the plaintiff was regularly in arrears of spousal support payments. [56] The order of Lander J. made February 1, 2005, stated (in paragraph 8(v)) that the FMEP would continue to enforce any arrears accumulated under Master Patterson's order of March 11, 2004, but the arrears were not quantified. [57] The plaintiff's allegation that he paid double support is difficult to assess, in that the order of Master Patterson made March 11, 2004, required him to start making child support payments in the amount of $976 per month retroactive to October 2003, and required him to pay spousal support of $3,000 per month, starting March 1, 2004. So the plaintiff had to pay $976 per month for the five months from October 2003, to March 2004, for child support, which totals $4,880. From March 1, 2004, to June 14, 2004, the plaintiff had to pay a total of $3,976 per month for four months which

totals $15,904. And so, as of June 14, 2004, the amount that he should have paid under Master Patterson's order was $20,784. The five cheques introduced by the plaintiff as exhibits show that he paid $11,775.60, between March 15, 2004 and June 15, 2004. The difference between the $20,784 due under the order (for the period from October 1, 2003, to June 1, 2004) and the $11,775.60 clearly paid by the defendant is $9,008.40. I cannot tell from the evidence as to how much, if any, of that $9008.40 had been paid by the plaintiff, by June 14, 2004. But I do conclude from the evidence presented, that arrears could not have been more than $9,008.40, as at June 14, 2004. [58] I conclude that the $12,584 assessed as arrears against the plaintiff as of June 14, 2004, was in error. The arrears could not have been more than $9,008.40. They may have been less, but I have no proof of that. Accordingly, the arrears should be reduced by $12,584 - $9,008.40 = $3,575.60. (I should add that there was nothing in the evidence to suggest that arrears had accumulated under the order of Master Patterson dated September 19, 2003, which required the plaintiff to pay child support for Brittany in the amount required by the guidelines, but without declaring what the plaintiff's guideline income was, or the amount of child support required.) Having regard to the provisions of s.96(2) and (3) of the Family

Relations Act, I am satisfied that it would be grossly unfair not to reduce the arrears by the $3,575.60 described above. [59] The FMEP statement as of January 18, 2010 states that $22,491.49 is owing by the plaintiff, for the following amounts: a) Arrears from ongoing maintenance, $21,466.84; b) Interest on arrears, $624.65; c) Provincial government fee, $400 Total $22,491.49 Since the plaintiff reduced his monthly payments to $1,500, as of March 14, 2009, I can see no basis on which to conclude that it would be grossly unfair not to cancel interest. [60] Arrears of $18,000 have accumulated since March 1, 2009, but they will be reduced by $3,575.60 leaving a balance of $14,424.40. The FMEP will be authorized to pay that amount out to the defendant forthwith. Should the balance of the funds held by FMEP be held as security? [61] The FMEP statement shows that they were holding $30,897.59 as of January 18, 2010, from the $35,397 seized from the plaintiff in August or September 2009. They have probably paid out another $3,000 to the plaintiff, by now. The balance of those monies remaining after payment out of $14,424.40 to the defendant and after payment of newly-calculated interest, and the government fee, shall be returned by the FMEP to the plaintiff, forthwith. I can see no possible ground upon which that money should be held as security for future payments of child

support. [62] I am going to leave it to counsel to ensure that FMEP is informed as to what is the correct state of affairs of the plaintiff's account, having regard to the amounts in the printout of January 18, 2010, and these reasons. I am reasonably confident that counsel will be able to agree as to settlement of the FMEP statement. But if there is some dispute that cannot be resolved, there will be liberty to apply. Costs [63] I consider that success has been divided between the parties on these two applications. It seems to me that the parties should each bear his and her own costs of the applications. That will be the order, unless an application is made to speak to the issue of costs, within 7 days of these reasons. _________ "Mr. Justice D.A. Halfyard"