Bouchard v. Bouchard

2018 BCSC 1728 Bouchard v. Bouchard

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Bouchard v. Bouchard, 2018 BCSC 1728 Date: 20181010 Docket: 98634 Registry: Kelowna Between: Sandra Leona Bouchard Claimant And Maurice Leigh Bouchard also known as Maurice Lee Bouchard Respondent Before: The Honourable Madam Justice Donegan Reasons for Judgment on Application Counsel for the Claimant: M.G. Miller No one appeared on behalf of the Deceased Respondent: Place and Date of Trial/Hearing: Kelowna, B.C. July 19, 2018 Place and Date of Judgment: Kelowna, B.C. October 10, 2018

INTRODUCTION [1] Sandra and Maurice Bouchard were married on March 6, 1999, and had two children together. They separated in 2012, the same year Mr. Bouchard received a significant personal injury award arising from injuries he suffered in a motor vehicle accident several years earlier. Ms. Bouchard first commenced a family law action in the Provincial Court of British Columbia and obtained some orders dealing with the children. She then commenced this action in 2013. [2] Mr. Bouchard died intestate in 2015. At the time of his death, approximately $322,000.00 remained of his personal injury award, held in trust by his personal injury law firm. With this application, Ms. Bouchard seeks an order releasing the current value of those funds to her. Although her written application identifies certain provisions of the Family Law Act, S.B.C. 2011, c. 25 [FLA] and the Wills, Estates and Succession Act, S.B.C. 2009, c. 13 [WESA] as the legal basis for this application, her counsel clarified at the hearing that she is seeking an order that Mr. Bouchard pay her lump sum child support in the full amount currently held in trust, pursuant to s. 170(g) of the FLA. Mr. Bouchard's estate has not been administered. [3] For the reasons that follow, I conclude that Ms. Bouchard's approach to this matter is legally unsupportable and her application must be dismissed. I will begin by outlining the facts.

FACTUAL BACKGROUND [4] The claimant and respondent married on March 6, 1999. They both worked in the film industry for years and had two children, now aged 17 and 12. [5] In February 2005, Mr. Bouchard suffered serious injuries in a motor vehicle accident. He retained a personal injury law firm, Taylor & Blair, to commence an action on his behalf. In August 2012, following a trial and an appeal, Mr. Bouchard was awarded approximately $1.9 million. [6] Unfortunately, Mr. Bouchard's serious injuries led to a drug addiction and by October 27, 2012, the date of the parties' separation, his behaviour had deteriorated to the point where Ms. Bouchard and the children had to flee for their own safety. Ms. Bouchard has had sole responsibility for the children since then. She quickly commenced family proceedings in Provincial Court to obtain protection and other orders. [7] On November 6, 2012, Judge Wallace granted a number of ex parte orders, including that Ms. Bouchard have interim sole custody and guardianship of the children and that Mr. Bouchard pay $300.00 per month for interim child support, based on an imputed annual income of $19,000.00. Judge Wallace also made an order pertaining to any funds obtained by Mr. Bouchard's counsel: 3. This Court dispenses with notice to the Respondent and orders that any funds obtained by any counsel on the Respondent's behalf be held in trust as

security for child support payments pursuant to the provisions of Section 30.1 of the Family Maintenance Enforcement Act [RSBC 1996] c. 128 and not be released until further order of the court. ("Order #3") [8] As a result of Order #3, Taylor & Blair held the funds remaining from Mr. Bouchard's personal injury award in trust. On September 20, 2013, the parties agreed to an order that Taylor & Blair release $10,000.00 to Mr. Bouchard's family lawyer and agreed to vary Order #3 to permit future release of funds held in trust, upon written agreement of the parties. [9] Ms. Bouchard commenced her action in this court on March 18, 2013. She sought various orders, including a divorce, orders pertaining to the children, spousal support, division of family property and debt, as well as restraining and protection orders. A few orders were made in 2013 and 2014, largely pertaining to the occupation and sale of the former family home. [10] Mr. Bouchard died on October 15, 2015, without having made a will. At the time of his death, about $322,654.52 remained of his personal injury award held in trust by Taylor & Blair (the "Trust Funds"). Ms. Bouchard is unaware of how Mr. Bouchard spent the rest of his personal injury award. [11] The application now before me was originally heard by Justice Rogers on March 20, 2017. Justice Rogers adjourned it generally, largely out of concern that Mr.

Bouchard's estate had not yet been administered. He felt that the Trust Funds appeared to be an asset of Mr. Bouchard's estate and that if the court were to bypass administration of his estate and directly release the Trust Funds to Ms. Bouchard, potential creditors might be deprived. He also expressed concern that bypassing administration of the estate might deprive the children of any direct entitlement they may have. Justice Rogers advised Ms. Miller that he would feel a lot more comfortable if an administrator had been appointed and had looked into the affairs of Mr. Bouchard's estate. He told her that "skipping over the administration of the estate is fraught with difficulty". [12] Rather than taking steps to have Mr. Bouchard's estate administered, Ms. Bouchard's counsel returned to the Provincial Court and applied unsuccessfully to set aside Order #3, as amended. She then appealed both Order #3 and the dismissal order to this court. [13] On December 19, 2017, Justice Brundrett allowed the appeal and vacated Order #3 on the basis that the Provincial Court lacked jurisdiction to make such an order. At the appeal hearing, Ms. Miller explained why Rogers J. adjourned the within application generally in these terms: I did bring an application on my client's behalf, in Supreme Court [Justice Rogers] said to me: "Mrs. Miller I think what you have to do is go back to Provincial

Court. [ ]" He didn't dismiss my application he just adjourned it generally. He said go back to Provincial Court, so I did. [14] This characterization fundamentally misunderstands the concerns expressed by Rogers J. [15] Following this successful appeal, Ms. Miller wrote to Taylor & Blair on December 22, 2017 and asked that the Trust Funds be released to her law firm, in trust for her client. Taylor & Blair responded on January 8, 2018, correctly advising Ms. Miller that they could not do so and would require either letters of administration or a court order indicating to whom the funds should be released. [16] Having been invested, the value of the Trust Funds, as of June 28, 2018 sits at $327,639.21. Taylor & Blair has not received any other claim to the Trust Funds. [17] No one, either on behalf of the children or any other eligible person, has applied to administer Mr. Bouchard's estate. MS. BOUCHARD'S POSITION [18] Ms. Bouchard seeks an order for lump sum child support from Mr. Bouchard in the total amount of the Trust Funds, and that the Trust Funds be paid to her directly through her counsel. Her counsel originally identified s. 171(2) and (3) of the FLA and ss. 20 and 21 of the WESA as the legal basis of her application, but clarified at the hearing that her application is actually reliant upon s. 170(g) of the FLA, in conjunction with s. 149 of the FLA. [19] Ms. Miller

submits that all issues in this family law claim must be resolved before any estate matters are considered. She submits that administration of Mr. Bouchard's estate is unnecessary because it has no assets. When asked about the Trust Funds, her view changed throughout the course of the hearing, but she ultimately settled on the position the Trust Funds form no part of Mr. Bouchard's estate. She also asks the court to accept, based upon Ms. Bouchard's belief and the absence of any other claims to the Trust Funds, that the estate has no debts. As reassurance, Ms. Miller tells the court that Mr. Bouchard's other family members, such as his mother and siblings, are all aware of this application and are "fine with it". [20] Ms. Miller submits that if the court is persuaded to proceed in the manner she suggests (using s. 170(g) of the FLA as the legal basis for the order she seeks), that the court should determine the amount of the award to be the current value of the Trust Funds. She provides no authority for such an approach, but rather advocates for the court to rely on her client's "rough estimate for raising children" and/or her "approximate average family costs" and "other costs associated with the break up of [her] family" calculations, attached to her client's affidavit. [21] In the alternative, Ms. Miller submits that to achieve her desired result (direct payment of the Trust

Funds to her client through her), the court could fashion some sort of combination of lump sum awards for child support and her unresolved spousal support and family asset division claims. She provides no specific submissions or authority for this suggestion. [22] I will now outline in very general terms the legislative schemes, rules and principles at play here, to demonstrate that the law does not support Ms. Bouchard's approach to this matter.

LEGAL FRAMEWORK [23] Ms. Bouchard wishes to proceed in this family law action without any representation of Mr. Bouchard's estate. [24] Section 150 of the WESA allows for the commencement or continuation of proceedings that could have been commenced or continued by or against a deceased person, whether or not a personal representative has been appointed, with certain exceptions. Either the deceased person or the personal representative can be named. [25] Section 151 of the WESA allows a beneficiary or an intestate successor, with leave of the court, to commence or defend proceedings on behalf of a personal representative if the personal representative fails to do so. [26] Rule 8-2 of the Supreme Court Family Rules, B.C. Reg. 169/2009 [Family Rules] allows a family law case to continue in spite of a litigant's death if the claim survives and allows for the court to add or substitute parties as necessary to ensure that all matters are properly adjudicated. A personal representative, executor, or administrator on behalf of the deceased's estate, as the case may be, is often substituted as a party for the deceased. [27] Rule 20-6 of the Family Rules provides a mechanism through which litigants can start or continue family law proceedings if one of the parties has died and there is no personal representative for a deceased's estate, such as the case here. In that case, the court

may, on application, appoint a person as a litigation representative to start, conduct or defend a family law case on behalf of the deceased. [28] Ms. Bouchard's application is brought under s. 170(g) of the FLA, found in Part 7, which deals with child and spousal support. Very generally, with respect to child support, s. 147 defines when there is a duty to provide it, s. 149 describes who may apply for it and provides the authority for the court to order it and s. 150 establishes what a court must consider in determining the amount. [29] Sections 170 and 171 pertain to both child and spousal support. Section 170 sets out matters that may be provided for in support orders and s. 171 establishes rules relating to support when a payor dies. These sections provide: Matters that may be provided for in support orders 170 In an order respecting child support or spousal support, the court may provide for one or more of the following: (a) that payments be made periodically, annually or otherwise, for an indefinite or limited period or until a specified event occurs; (b) that child support or spousal support be paid respecting any period of time before the date the application for the order is made; (c) that payment of a lump sum be made, directly or in trust; (d) that a charge be registered against specific property to secure payment; (e) that a person who has a contract of life

insurance within the meaning of Part 3 of the Insurance Act (i) designate his or her spouse or child as a beneficiary, irrevocably or for the period designated by the court, and (ii) either pay all premiums on the policy, or authorize his or her spouse to pay all premiums on the policy and to compensate the spouse for doing so; (f) that expenses arising from and incidental to prenatal care of a mother or child, or the birth of a child, be paid, except in relation to the prenatal care of a surrogate within the meaning of section 29(1) [parentage if surrogacy arrangement]; (g) subject to section 171(1) [support obligations after death], that a duty to pay child support or spousal support continues after the death of the person having the duty, and is a debt of his or her estate for the period fixed by the court. Support obligations after death 171(1) Before making an order under section 170(g) [matters that may be provided for in support orders], the court must consider all of the following factors: (a) that the person receiving child support or spousal support has a significant need for support that is likely to continue past the death of the person paying child support or spousal support; (b) that the estate of the person paying child support or spousal support is sufficient to meet the need referred to in paragraph (a) after taking into account all claims on the estate,

including those of creditors and beneficiaries; (c) that no other practical means exist to meet the need referred to in paragraph (a). (2) If an agreement, or an order under section 170(g), is made and the person having a duty to pay child support or spousal support dies, the person's personal representative may make an application, and the court may make an order, to (a) set aside or replace with an order made under this Part all or part of the agreement, or (b) change, suspend or terminate the order. (3) If a person having a duty to pay child support or spousal support under an agreement or order dies and the agreement or order is silent respecting whether the duty continues after the death of the person and is a debt of his or her estate, (a) the person receiving support may make an application under section 149 [orders respecting child support] or 165 [orders respecting spousal support], and (b) if, on consideration of the factors set out in subsection (1) of this section, an order is made, the duty to pay child support or spousal support continues despite the death of the person and is a debt of his or her estate for the period fixed by the court. [30] Mr. Bouchard died intestate. In the absence of a spouse, the court may grant administration of the deceased person's estate to other persons, as identified and prioritized in s. 130 of WESA, including the Public Guardian and

Trustee. [31] Part 3, Division 1 of WESA sets out how an intestate estate must be distributed. Very generally, if the intestate deceased leaves no spouse (which Ms. Bouchard concedes is the case here), but leaves descendants or relatives, s. 23 provides for the distribution process. [32] After a parent dies, their estate may be liable for outstanding and continuing child support payments. The personal representative of the estate plays a role in determining whether the estate is liable for these things. This role is summarized in the British Columbia Probate and Estate Administration Practice Manual, 2nd Ed. (Vancouver: The Continuing Legal Education Society of B.C., 2007) (loose-leaf updated 2018), §11.27: If the deceased was, immediately before death, liable for payment to an estranged spouse or child under a separation agreement or a court order, any arrears outstanding immediately before death will be a debt payable out of the estate. The personal representative will also have to determine whether the estate is liable for ongoing maintenance for the period following death. If so, the estranged spouse or child will rank as an ordinary creditor of the estate for the future installments, and the personal representative will be obliged to provide for that claim before distribution to beneficiaries. Failure to do so will render the personal representative personally liable for

devastavit (see §11.12). [33] In the past, under the common law, a payor's child support obligation ended upon death (see Milne v. MacDonald Estate, 1986 CanLII 931 (B.C.C.A.) and R.M.R. v. H.V., 2005 BCSC 52 at paras. 16-22), unless the parties reached an agreement or there was a court order specifying that the payor's support obligations would continue beyond his or her death. If there was such an agreement or court order in existence at the time of death, these obligations could continue as a liability of the estate: Crain v. Crain, 1996 CarswellBC 1174 (S.C.) at paras. 11-15. [34] The common law I have just described has now been changed by the FLA. In the situation where a payor who has a duty to pay support under an agreement or order dies and the agreement or order is silent about whether that duty continues after the payor's death and is a debt of his/her estate, s. 171(3) of the FLA now allows the recipient of that support to apply for an order that the duty to pay support continues despite the death of the payor and is a debt of the estate, based on the factors in s. 171(1). [35] This change was recently discussed by our Court of Appeal in Kumagai v. Campbell Estate, 2018 BCCA 24. [36] In that case, the parties were married in 2006. They separated on July 25, 2013 and the family law action commenced the following day. On August 13, 2013, Mr. Campbell was ordered to

pay Ms. Kumagai interim spousal support of $5,000.00 per month. The order was silent about whether the duty would continue after Mr. Campbell's death and was a debt of his estate. Mr. Campbell died eight days later. [37] Mr. Campbell left a will appointing Ms. Saganiuk as the executrix of his estate. The family law action continued and on May 12, 2014, Ms. Saganiuk, as executrix of the estate, was added as a respondent. [38] The trial was ultimately held in 2016. One of the many issues for determination was whether Mr. Campbell's spousal support obligation (interim and without provision that the obligation continue after death) should continue after his death and become a debt of the estate under s. 171(3) of the FLA. [39] The trial judge initially declined to make such an order, concluding that the use of the word "spouse" in s. 171(3)(a) precluded, by definition, the court from making an order against a deceased. However, upon reconsideration, the trial judge came to conclude otherwise. [40] In reasons indexed at Kumagai v. Campbell Estate, 2016 BCSC 1161 (the "Reconsideration Decision"), the court considered that s. 171(3) must be interpreted in a manner consistent with the legislature's intention to provide a mechanism for the ongoing payment of support upon the death of the payor spouse. As a result, the claimant was not precluded by the wording of s. 171(3) from applying

for an order that Mr. Campbell's spousal support obligation continues despite his death and becomes a debt of his estate. [41] Following this determination, the trial judge went on to apply the factors outlined in s. 171(1), as well as the applicable provisions of the Federal Child Support Guidelines, SOR/97-175 and Spousal Support Advisory Guidelines to ultimately determine the quantum of the spousal support obligation payable from Mr. Campbell's estate as a debt of the estate. [42] This aspect of the Reconsideration Decision was upheld on appeal. Madam Justice D. Smith for the Court, held: [97] On reconsideration of whether the interim spousal support order could survive the death of Mr. Campbell, the judge found that the object and intention of the Legislature was clear and to not give it effect would result in an absurdity (at paras. 9-21). I agree. In my respectful view, the judge correctly applied the well-known principles of statutory interpretation set out in Rizzo & Rizzo Shoes Ltd. (Re), [1998] 1 S.C.R. 27 and reiterated in Bell ExpressVu Limited Partnership v. Rex, 2002 SCC 42, in determining that the legislative intent of these provisions was to provide a mechanism for the ongoing payment of spousal and child support upon the death of the payor spouse based on the factors listed in s. 171(1). The Legislature has clearly and expressly changed the common law

principles with respect to support under the FLA. I find no error in the judge's reconsideration of this issue. [98] I similarly find no error in the judge's determination that the reference to an "order" in s. 170(g) and s. 171 includes an interim order. As the judge noted in his initial reasons (at paras. 167-169), the FLA does not define or limit the meaning of the word "order". In comparison, the Supreme Court Family Rules define a "final order" as an order that finally resolves the family law claim and the Supreme Court Civil Rules define an "order" to include "a judgment and a decree". [99] Section 216(2) of the FLA requires a court to make an interim order "in accordance with any requirements or conditions of this Act that would apply if the order were not an interim order." Sections 161 and 162 of the FLA set out the objectives for determining entitlement to spousal support, and the factors to be considered in determining the amount and duration of spousal support, respectively, which a court is required to consider in making a spousal support order. Although the Estate asserts that entitlement is often not determined when making an interim support order, entitlement is an express consideration under s. 161 and therefore for an interim order under s.

216. In short, an order is an order absent language in a provision that limits the nature and scope of an order that can be made after the death of a payor. [100] I also find no error in the judge's determination, based on all the evidence before him, that the factors he was required to consider under s. 171(1) were met. The judge found that, despite the compensatory award for property division Ms. Kumagai would receive and her monthly bequest of $5,000 under the Will, Ms. Kumagai had demonstrated a significant need for further support. It was open to the judge to make such a finding based on the evidence before him. The evidence of all the claims against the Estate was also before the judge, and he determined that the Estate was sufficient to meet Ms. Kumagai's need for spousal support in light of those claims. The Estate submits that s. 171(1)(c) is not met as the $5,000 monthly bequest Ms. Kumagai receives represents a practical means of meeting her need; however, the judge clearly stated in his initial reasons that Ms. Kumagai "demonstrated a significant need for support beyond the $5,000 per month that she is entitled to receive under the provisions of the Will" (at para. 184). As a result, I find no merit to the argument that her bequest under the Will could be a practical means of meeting the need she demonstrated. [Emphasis in original] [43] To reiterate, under the old

common law, unless the parties had agreed or a court had ordered that support obligations would continue after death, support obligations ended upon the payor's death. Under the FLA, it remains the case that the parties can agree or a court can order that a payor's support obligation continues after death and is a debt of the estate: s. 170(g); however, the legislation now allows for a recipient of support to apply to have that support continue as a debt against the payor's estate, even if the original support agreement or order was silent about support continuing after death: s. 171(3).

ANALYSIS [44] To repeat, Ms. Bouchard seeks an order that Mr. Bouchard pay her lump sum child support for the two children, pursuant to s. 170(g) of the FLA, in the full amount of the Trust Funds. She also seeks an order that Taylor & Blair release those funds directly to her lawyer. [45] On the evidence adduced, the Trust Funds can only be seen as an asset of Mr. Bouchard's estate. Ms. Bouchard's attempt to obtain these funds using this approach really asks the court to circumvent the proper procedural and substantive law. [46] Procedurally, Ms. Bouchard is improperly attempting to obtain orders in the absence of any representation of Mr. Bouchard's estate. The orders she seeks could only be orders against his estate and no one has been appointed as a personal or litigation representative. [47] Substantively, Ms. Bouchard's reliance on s. 170(g) of the FLA is incorrect. [48] The purpose of s. 170 of the FLA is to provide the court with an avenue to make child and spousal support orders with some flexibility in order to provide or secure support in a way that is suitable to the circumstances of individual cases. While not explicitly stated, when I consider the words of the section in their entire context and in their grammatical and ordinary sense harmoniously with the scheme and object of the legislation and the intention of the legislature, it is clear that orders under s.

170 of the FLA are intended to be used while the parties are living. [49] The words of the section themselves reflect an intention that such orders be made while both parties are alive. For example, s. 170(e) allows the court to order a person who has a life insurance policy to designate a spouse or child as a beneficiary and pay its premiums. Such an order would not be possible after the payor's death. Another example can be found in s. 170(g), which permits a court to order, after consideration of factors outlined in s. 171(1), that the payor's support obligation will continue after his or her death and is a debt of his or her estate. To have the authority to order support will be binding on a payor's estate if he or she were to die, necessarily implies the payor is alive at the time of the order. [50] This intention seen in the language of the section itself is reinforced by existence of, and language used in, the following section, s.

171. This provision establishes rules relating to support obligations after the death of a payor. [51] Section 171(2) speaks to the situation where an order under s. 170(g) exists and then the payor dies. In that case, the deceased's personal representative is permitted to apply for an order to set aside, replace, change, suspend or terminate the s. 170(g) order. [52] Section 171(3) speaks to the situation where a payor who has a duty to pay support under an agreement or order dies, but the agreement or order is silent about whether the support obligation binds his or her estate. In that case, the recipient may apply for support to continue and to bind the estate. If such an application is brought under this section, the court is required to consider the factors outlined in s. 171(1). These factors include whether there is significant need, whether the estate is sufficient to meet the need after taking account of all claims of the estate, including those of creditors and beneficiaries, and whether no other practical means exist to meet the need. [53] If s. 170(g) allowed for orders of the nature sought by Ms. Bouchard in this application, then s. 171(3) would be rendered obsolete. [54] In summary, counsel for Ms. Bouchard is in error in pointing to s. 170(g) of the FLA as an avenue to obtain an order securing the Trust Funds directly to her client in these circumstances. [55]

As there is a prior order for child support that is silent respecting whether the order continues and binds the estate in this case, s. 171(3) would provide an avenue for Ms. Bouchard to apply for an order for the ongoing payment of child support as a debt of the estate. Ms. Miller does not rely upon this particular provision, but even if it could be said that her submissions implied its application, there is insufficient evidence before the court to address the s. 171(1) factors. [56] Further, even if it could be said that all of the correct procedural requirements had been met, that the estate of Mr. Bouchard was represented, that the application was properly brought under s. 171(3), and that sufficient evidence was adduced persuading the court to award an amount of lump sum child support in Ms. Bouchard's favour, the quantum of such an award could not be determined in the unusual manner suggested by Ms. Miller. [57] Finally, it must be noted that any award for child support in Ms. Bouchard's favour would only create a debt against Mr. Bouchard's estate. Establishing a debt against the estate of a deceased person does not entitle a litigant to a court order for the amount of the debt. Debts against an estate must still be considered in terms of priority by the executor or estate administrator, as the case may be. This is one of the reasons why administration of Mr. Bouchard's

estate is critical. [58] Ms. Bouchard's belief that administration of Mr. Bouchard's estate is unnecessary is grounded primarily in two fundamental misunderstandings. First, she believes the Trust Funds are not an estate asset. On the evidence before this court, they certainly appear to be an asset of Mr. Bouchard's estate. [59] Second, she believes there are no other claims against Mr. Bouchard's estate. With respect, this is impossible for her to know. Ms. Bouchard was separated from Mr. Bouchard for about three years at the time of his death and was not privy to all of his activities during this time. The fact that Taylor & Blair has received no claim to the Trust Funds is no comfort. Taylor & Blair is not administering the estate. The fact that some of Mr. Bouchard's family members are "fine with it" is also of no comfort. No one is administering this estate. It is entirely possible that other debt claims to the estate may exist and it is also entirely possible that such claims may have priority over any child support debt the estate may owe if an award were made. [60] Finally, it must be said that circumventing the proper administration of Mr. Bouchard's estate fails to recognize or consider the legitimate direct interests of the children on an intestacy distribution. As Mr. Bouchard died without leaving a spouse, the children would have a direct claim to their father's net estate on such a distribution. Their interests need to be considered. [61] In the end, it is very clear that Ms. Bouchard's approach in this application is procedurally and substantively incorrect and must be dismissed. I direct that a copy of these reasons be sent to Taylor & Blair for their records. "S.A. Donegan J." DONEGAN J.