T.E.B. v. B.S.B.

2022 BCSC 1184 T.E.B. v. B.S.B. IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: T.E.B. v. B.S.B., 2022 BCSC 1184 Date: 20220414 Docket: E108405 Registry: Kelowna Between: T.E.B. Claimant And B.S.B. Respondent Before: The Honourable Mr. Justice Wilson Oral Reasons for Judgment In Chambers Counsel for the Claimant: S.L. Specht Counsel for the Respondent: A.J. Boland Place and Date of Trial/Hearing: Kelowna, B.C. April 4 - 5, 2022 Place and Date of Judgment: Kelowna, B.C. April 14, 2022 [1] THE COURT: This is an application by the claimant to determine the respondent's child support and spousal support obligations. [2] On March 8, 2017, Justice G.P. Weatherill pronounced a final order by consent that addressed a number of matters, including the respondent's support obligations ("Weatherill Order"). Because he had only recently changed employment, the parties agreed to an order that provided for annual reviews to be conducted in each of the following three years. The claimant applied in 2018 to clarify the respondent's obligations, at which time Mr. Justice Betton determined support retroactively and fixed arrears ("Betton Order"). [3] On this application, I will need to determine the claimant's income since the Betton Order; the respondent's income since the Betton Order; and whether child support remains payable for each of the children of the marriage. Background [4] After a brief period of cohabitation, punctuated by a brief separation, the parties married on April 13, 1998, and within a year were expecting their first child. As a result of medical complications during pregnancy, the claimant ceased working outside the home and assumed what is often described as a traditional role as wife and mother. [5] The parties have four children, who are currently as follows: Child 1, age 22; Child 2, age 20: Child 3, age 19; and Child 4, age 18. [6] The parties lived in Alberta for the first several years of their marriage and the respondent was and continues to be employed in the oil industry in Alberta. In 2011, the family relocated to Kelowna and bought a home at 4842 Westridge Drive ("Westridge Home"). Notwithstanding the move, however, the respondent continued to earn his income in Alberta. [7] In November 2014, the respondent made the decision to end the relationship and he moved out of the family home shortly thereafter. This litigation was commenced in the fall of 2015. [8] In January 2017, the respondent lost his job with MEG Energy and received a severance package. He obtained alternative employment in March 2017 with Devon Canada. Around that time, the respondent applied for an order to sell the former matrimonial home. The claimant wished to keep it. What followed was an order that afforded the claimant three months to buy out the respondent's interest. [9] The parties went to a mediation. While quantum of support was undoubtedly in dispute, there was no doubt that the respondent had underpaid support to the claimant in the months following the separation, and an agreement was entered into whereby the claimant bought out the respondent's interest and any arrears or, more accurately, claims to retroactive support were waived. Because the respondent had only recently started his employment with Devon Canada, the parties consented to an order pronounced by Justice G.P. Weatherill on July 17, 2017, as it related to support: UPON THE COURT being advised that the Respondent 2017 Line 150 income has not been determined and the Claimant's Line 150 2017 income has not been determined: UPON THE COURT being advised that there are four children of the marriage, namely [Child 1], born [redacted] ("[Child 1]"), [Child 2], born [redacted] ("[Child 2]"), [Child 3], born [redacted] ("[Child 3]") and [Child 4], born [redacted] ("[K.A.B.]"), collectively, (the "Children"). 7. the Respondent, [B.S.B.] shall pay to the Claimant spousal support in the amount of $3,500 commencing July 1, 2017, and on the 1st day of every month thereafter until the first review and adjustment of spousal support on April 1, 2018. 8. the Respondent, [B.S.B.] shall pay to the Claimant for the support of the Children the amount of $3,000 per month commencing July 15, 2017 and on the 15th day of every month thereafter until the first review and adjustment of child support on April 1, 2018; 9. the Claimant shall claim the spousal support paid to her by the Respondent as income and the Respondent shall claim the spousal support paid by him to the Claimant as a deduction on his income; 10. the Claimant acknowledges that the Respondent has paid her support in the amount of $3,300 for the month of July, 2017 and the Respondent shall pay to the Claimant the balance of the child and spousal support in the amount of $3,200 on or before July 31, 2017; 11. the Claimant and Respondent shall exchange full financial disclosure by no later than March 15, 2018 and shall review child support and spousal support payable by the Respondent to the Claimant in the 2017 tax year based on the Respondent's Line 150 guideline income for 2017 and based on the greater of income of the Claimant imputed Line 150 income of $30,000 or her actual 2017 Line 150 income, which 2017 income shall not include her RRSP income or spousal support; 12. the parties shall calculate retroactive child and spousal support, if any, payable by the Respondent to the Claimant for the 2017 tax year including the amount of mid-range spousal support and child support paid by the Respondent to the Claimant up to June 30, 2017 and the amounts of child and spousal support paid by him to her in accordance with the within Order and any arrears of support determined to be payable by the Respondent to the Claimant for the 2017 tax year shall be either deducted from the balance of the Equalization Payment payable by the Claimant to the Respondent or be payable by the Respondent from the bonus he anticipates received through his current employment with Devon in March, 2018; 13. commencing April 1, 2018 the amount of monthly child support and monthly mid-range spousal support payable by the Respondent to the Claimant shall be based on the Respondent's 2018 annual employment income, including forecasted bonuses and allowances for income, and which calculation of income shall not include the Respondent's severance and income from MEG Energy in the 2017 tax year and the monthly spousal support shall be determined using the mid-range of the Spousal Support Advisory Guidelines; 14. commencing April 1, 2019 spousal support will be reviewed and adjusted annually for three years, using mid-range support, after which time reviews and frequency of the reviews will be by agreement between the parties or court order; 15. the arrears and retroactive child support, mid-range spousal support and Section 7 expenses payable by the Respondent to the Claimant have been accounted for, calculated in and paid in the division of family property and debt and the determination of the Equalization Payment payable by the Claimant to the Respondent; 16. the parties shall either trade in or sell the 2014 Infinity as soon as it is possible and shall divide equally between them the net sale proceeds after payment of the Royal Bank loan against this vehicle and in the event there is a loss such loss shall be paid equally by them; 17. the Respondent shall be solely responsible to the Kelowna Christian School tuition fees for [Child 1] and [Child 3], if [Child 3] attends the Kelowna Christian School, for the 2017/2018 school term only and all other Section 7 expenses shall be agreed in writing between the Respondent and Claimant or shall be determined by further Court Order; 18. the Respondent shall continue to maintain the Children on his extended medical health and dental plans through his employment for so long as he is able to do so; . . . [10] The order of Mr. Justice Betton, which was the first of the reviews, set the respondent's income at $225,000 and determined the arrears, with a portion of those arrears satisfying the claimant's unpaid obligations regarding her buyout of the Westridge Home. The parties' incomes since separation [11] The claimant decided to supplement her support income by renting out the Westridge Home during the summer months by way of short‑term rentals. The Westridge Home is a large, comfortable, five‑bedroom home with a swimming pool, and Kelowna is a popular summer destination. Initially whenever the home was rented, she and the children went on road trips in the family motorhome. Ultimately, however, the motorhome was sold. [12] The claimant subsequently renovated the basement and put in a full suite("Basement Suite"). She and the family reside in the Basement Suite while the upper portion of the home ("Upper Suite") is rented during the summer, and she rents the basement suite for the remainder of the year by way of long term rentals. She can receive up to $1800 per day for the Upper Suite in peak season. [13] The claimant's ability to rent out portions of the Westridge Home from time to time has been significantly impacted by the COVID pandemic. However, she intends to persist with this business and also seeks to expand her business by managing similar rental arrangements for others on a fee‑for‑service basis. [14] In the meantime, the respondent has continued to work in the oil and gas industry in Alberta. While he has had a couple of changes in employer and his income has fluctuated as a result, he continues to earn a good income. What is not in issue [15] There are a number of things on this application that are not in dispute: a) First, the respondent accepts that the younger two children have always been and continue to be children of the marriage for support purposes; b) Second, although both parties have since re‑partnered, neither considers the incomes or the circumstances of the new partner to be relevant to this application; and c) Third, although this is a court‑ordered review, the respondent does not suggest termination of the claimant's support obligations is appropriate. [16] As such, although both parties have included some evidence of the circumstances surrounding their marriage and its subsequent breakup, the court's task on this application does not involve any investigation of the nature of the claimant's entitlement to either spousal support or child support. [17] As for child support, all four children reside in the Westridge Home with the claimant and have done so continuously, other than a brief period when the older child went to college in Abbotsford. [18] As for spousal support, the parties have already agreed, by way of the Weatherill Order, that the claimant will receive mid‑range spousal support. Neither seeks to deviate or vary that term of the Weatherill Order, and therefore no consideration of the claimant's claim to spousal support as compensatory or non‑compensatory is engaged. Any suggestion that the respondent may have agreed to something other than an equal division of family property in order to reduce his ongoing support obligations is similarly irrelevant. This Application [19] The issues on this application are: a) what are the parties' Guideline incomes for the relevant years from 2019 and subsequently? b) Second, has Child 1 remained a child of the marriage throughout? c) Third, has Child 2 remained a child of the marriage throughout? If so, how ought child support to be determined? d) And finally, the claimant seeks an order for a fine. [20] The parties' counsel provided the court with various DivorceMate calculations that accord with their submissions. However, both agree that there are numerous permutations and possibilities, and they are confident they will able to agree on the appropriate amounts if the court is able to answer the questions that would generate the required inputs. Claimant's income [21] Other than support, the claimant's sole source of income was derived from renting the Westridge Home. The claimant says she should be imputed an income of $30,000 per year. The claimant's income tax returns reveal the following: Gross Rental Income Deductions Net Income 2018 $31,620 $59,305.28 (27,685.28) 2019 $45,000 $51,934.59 (6,934.59) 2020 $26,636.25 $25,367.35 $1,268.90 2021 $54,748.75 $52,812.33 $1936.42 [22] The difficulty in determining the claimant's income in these circumstances is the treatment of expenses. For example, the claimant has undergone significant renovations and improvements, including a kitchen renovation, creation of the basement suite, and a renovation of the pool. [23] The claimant argues, and I accept, that in order to attract a top dollar for rental income, the Westridge Home must be correspondingly fitted and maintained. However, there is obviously a concurrent benefit to the claimant, who also resides in the home. Moreover, her ability to claim expenses is likely amplified by the fact that she can potentially claim expenses for the entire property, as she resides in the upper suite for most of the year, but resides in the basement suite when the upper suite is rented. [24] The court's ability to assess the expenses is further hindered for 2020 and 2021 because the allocation of the personal portion of the total expenses has not been included on the claimant's statement of real estate rentals form in the claimant's tax returns, and I therefore assume that any such calculations or allocations are made off the tax form. The fact that the claimant's tax returns are prepared by a professional is of no comfort, because the accountant is presumably following client instructions, albeit within certain parameters that govern the profession, and the client is the sole source of the information provided to the accountant. [25] The claimant's income is also complicated somewhat by the role of her new partner. While his income is not relevant, the parties have a cohabitation agreement which calls on her new partner to pay expenses. It is not clear how those expenses are calculated, and it is also not apparent whether other expenses claimed by the claimant are reduced accordingly. [26] Further, the claimant borrowed, by way of two separate documented loans, funds from her partner to buy a car and to undertake the basement renovation. According to the loan agreement, her partner is entitled to all of the rental proceeds from the basement suite until such time as his loan is paid. As a result, the claimant says that rental income from the basement suite does not show on her income tax return, because all the rent goes to her partner. This may be the arrangement between those parties, but it is not apparent to me that this represents an appropriate arrangement for tax purposes and one might expect that the basement renovation would be treated as a capital project subject to a capital cost allowance, as opposed to expensing it against income entirely. [27] None of the discussion above is intended to suggest that the claimant has done anything untoward or improper with regard to her taxes. Taxpayers are entitled to arrange their affairs in the most tax‑advantageous manner, so long as it complies with legislation. However, it does call into question the appropriate level of income to either be calculated or imputed to the claimant, because it makes the picture of her income all the murkier. [28] The claimant says that regardless of the deductions, her proposed imputed income of $30,000 is reasonable. She says that even if significant portions are added back into her income, it would not take her income over $30,000. In other words, any add‑backs to her net income, as discussed above, are immaterial unless they were to increase her net income to above $30,000 and she says there is no evidence to suggest anything close to adjustments of that magnitude. [29] The respondent's argument is there are three bases upon which income should be imputed to the claimant: a) first, he says she has not accurately reported her gross income in her financial statements and tax returns, which creates doubt as to whether the court can rely on the information she provides; b) she has deducted large expenses from her income that are not necessarily legitimate or, more precisely, may not be appropriate deductions for support purposes; and finally c) he says she is underemployed. The claimant has not accurately reported her gross income in her financial statements and tax returns, which creates doubt as to whether the court can rely on the information she provides [30] The statements obtained from Airbnb and VRBO do not, on their face, appear to match with the gross rental income disclosed in the claimant's tax returns. According to the respondent, the claimant's document disclosure reveals the following for each year: According to the respondent, the claimant's document disclosure reveals the following for each year: a) 2019: $46,705 from AirBnB and VRBO and $11,900 from her basement suite, for a total of $58,605 in gross rental income. In her 2019 tax return, she declared gross rental income of $45,000. b) 2020: $32,947.95 from AirBnB and VRBO and $17,300 from her basement suite, for a total of $50,247.95 in gross rental income. In her 2020 tax return, she declared gross rental income of only $26,636.25. c) 2021: $50,978.82 from AirBnB and VRBO and $15,900 from her basement suite, for a total of $66,878.82 in gross rental income. In her Form F-8 Financial Statement, she claims to have gross rental income of $54,748.75. [31] Even assuming that the basement suite rentals are not included, because she has indicated that the rent has all been paid over to her new partner pursuant to the loan agreement, the calculations still do not add up precisely. [32] Additionally, the claimant has business income from another business, My Property Partner, which is her new venture to manage Airbnb and VRBO properties for others. Her 2021 income tax return shows revenues of $8,464 less expenses, less a portion for home office expenses, leaving her with a net income from that venture of $155.10. Included in those expenses are her vehicle expenses for her Tesla, which is financed through a loan from her new partner. Expenses with a significant personal component [33] The respondent disputes many of the deductions claimed by the claimant from her business income. The list includes the items at paragraph 79 of the respondent's written submissions: 79. Two days before the date the Respondent's affidavit was due in mid-March and after express written request in December of 2021, the Claimant provided hundreds of pages of receipts that, she says, document her rental expenses. These receipts indicate that most of the expenses claimed have a clear personal component. For example: a. Hundreds of dollars of wine and liquor purchases from local liquor stores and wineries; b. Receipts from Winners and Homesense that includes various homewares products as well as clothing; c. Receipts for regularly grocery items as well as for snacks and beverages; d. Gas and parking receipts, when the Claimant actually lives in the home itself. Including for airport parking and gas purchases across the province; e. Meals eaten out for multiple people at local restaurants; f. Expenses for which the Claimant enjoys a clear personal benefit, including: i. Lawn care; ii. Pool care; iii. Household goods and garden supplies; iv. Cleaning costs (while the Respondent accepts that this could be a reasonable expense, if the Claimant's entire job is to run a rental suite but is contracting out the cleaning, then it raises the question of whether she could be doing other productive things with her time). v. Septic tank pumping, including during the off-season; g. Automotive work for the Claimant's spouse Brodie; h. Auto parts; i. A complete set of new high-end kitchen items, apparently purchased by the Claimant's new spouse, and written off over time as a capital asset; j. Kitchen renovation, again paid by the Claimant's new spouse; k. Basement renovations; l. Receipts lacking description, again made out to the Claimant's new spouse; m. Custom pool furniture; n. New lighting; o. Tools, including leaf blower, tire inflating gun, and wet vacuum; p. Carpet cleaning, including during the "off season"; q. New curtains/shades; r. Exterior painting; s. New furnace (although the home is mainly rented out during the summer months); t. Landscaping u. A Tesla charging station (both the Claimant her partner drive Teslas). [34] The respondent argues that all, or substantially all, of these expenses necessarily include a significant personal‑use component. The respondent also points out that although the claimant says that she and her new partner are financially independent, a number of the receipts were issued in her new partner's name as opposed to the claimant's. Underemployment [35] Finally, the respondent says the claimant is underemployed. He says that the VRBO business involves roughly 45 nights of renting out the upper suite, but other than that, her time would appear to be her own and there is no reason she could not obtain outside employment. [36] He says she should be imputed income based on minimum wage of $30,000 per year, in addition to rental income, and that her gross rental income ought to be utilized because the expenses are largely unproven, and with regard at least to the retroactive support claim, her CERB payments also need to be taken into account. Procedure [37] The claimant's application is, in essence, an application to vary a final order, albeit one that was agreed to previously. The parties agreed on the need for a review of support at the time of the Weatherill Order, and it was believed by both parties that an annual review for each of the following three years would provide the parties with sufficient information in order to be able to assess, with some level of certainty, the parties' incomes and, more significantly, the respondent's income given his recent changes in employment. [38] In C.M.R. v. L.F.R., 2019 BCCA 371, the Court of Appeal faced an appeal from a chambers decision varying a final order regarding obligations to pay child support. The Court of Appeal concluded the application needed to go to trial because: a) parties can only obtain a final order following trial or summary trial pursuant to Supreme Court Family Rule 10‑11; b) if a party later seeks to change a final order, they must do so by way of an application, because an application to change or set aside a judgment is a chambers proceeding (Rule 10-3(1)(b)(i); and c) Rule 10‑3(7) sets out the powers of the court on hearing a chambers application, one of which is to order a trial of the matter. [39] In reaching its decision in C.M.R., the Court of Appeal relied on British Columbia (Milk Marketing Board) v. Saputo Products Canada G.P., 2017 BCCA 247, where the Court of Appeal held that the proper question before the trial judge was not whether the application could be decided on the face of conflicting affidavits, but rather whether the applications raised a triable issue. If so, the matter must be referred to the trial list, which would not preclude a party from proceeding by way of summary trial. [40] The Court of Appeal in Cepuran v. Carlton, 2022 BCCA 76, a five‑member panel of the Court of Appeal overturned Saputo and concluded that the question of whether the matter needed to be referred to the trial list was summarized at paragraph 158, where the Court said: "The mere fact that there is a triable issue is no longer a good reason." [41] At paragraph 160 of Cepuran, after reviewing various alternative procedures that are available and reiterating the Court's concerns about ensuring proportionality and the speedy and efficient determination of cases on their merits, the Court said the following: [160] To summarize, I am of the view that a judge hearing a petition proceeding that raises triable issues is not required to refer the matter to trial. The judge has discretion to do so or to use hybrid procedures within the petition proceeding itself to assist in determining the issues, pursuant to R. 16‑1(18) and R. 22‑1(4). For example, the judge may decide that some limited discovery of documents or cross‑examination on affidavits will provide an opportunity to investigate or challenge the triable issue sufficiently to allow it to be fairly determined by the court within the petition proceeding, without the need to convert the proceeding to an action and refer it to trial. [42] Returning to the case at hand, the first of the three annual reviews contemplated by the Weatherill Order was conducted by Justice Betton, wherein he determined the parties' incomes for 2018 and set arrears accordingly. The two subsequent reviews, which would have occurred in 2020 and 2021, did not occur, but I am satisfied that the underlying purpose of the reviews was to make determinations once patterns of income had been established, as opposed to a concern as to the quantity of reviews. [43] As such, the matter that is presently before the court could result in indefinite orders, subject to the ability to apply based on a material change in circumstances. Any order I make may therefore have long‑term implications for the parties, and I must therefore be satisfied that I am in a position to make the requisite factual findings that would ground such an order. [44] Courts, whether on review of applications or at trial, are often faced with imperfect evidence, but nonetheless must make a decision based upon on the evidence as presented, and there is often an inherent uncertainty in many decisions regarding the prospective incomes of one or both parties. [45] In the context of an interim application, it is often said that the court will come up with what is referred to as "rough justice". The court will often be left to make an educated guess of the parties' income, but with the expectation that a more thorough and detailed analysis of the facts will occur at trial. [46] Parties are entitled to a hearing that is fair but not to one that is perfect. The Family Law Act, s. 199(1) and Rule 1‑3 of the Supreme Court Family Rules both contemplate the need for just, speedy, and inexpensive resolution of family law disputes. [47] In this case, neither party encouraged the court to set the matter for trial. Although the respondent has a good income, he does not have unlimited income, and the cost of legal proceedings is one of significant concern to both of these parties. I must therefore be mindful of any procedures, even short of full trial, that will cause the parties increased expense. On the other hand, what is contemplated on this application may result in an indefinite order and, as such, the court needs to be satisfied that it has the ability to make the necessary findings. [48] I am satisfied that I can make determinations with regard to whether the older two children are children of the marriage for support purposes. In so saying, I take some comfort from the assurance of both counsel that, in these circumstances, a decrease in the amount of child support would result in a corresponding increase to spousal support, and therefore the net effect on the parties is relatively modest. I am also mindful of the fact that the status of an adult child as a child of the marriage may change over time, depending on the circumstances of a particular child. [49] I am also satisfied that I am able to make findings with regard to the respondent's income. While doing so necessarily involves a certain degree of speculation and requires the court to draw some inferences, this is an inevitable consequence of the respondent's change in employment and the nature of the oil and gas business, and indeed the economy generally. A trial judge would not be in a significantly different or better position than I am on this application. Regardless of his level of income, the respondent is, of course, obligated to advise the claimant of any material changes that may serve to change his obligations. [50] The claimant's income is more problematic. I say this for a number of reasons. First, as I reviewed earlier and as I understand the claimant's evidence, her income tax returns only disclose the rental income for the upstairs suite, which is only rented during the summer months. The claimant occupies the basement suite when the upper suite is rented, but the remainder of the year it is rented out to third parties. The claimant's explanation is that she borrowed approximately $58,000 to create the basement suite and that the terms of her loan agreement require her to pay the entire rental proceeds to her lender who is her new partner. This raises some questions, the answers to which are not apparent on the evidence before me. [51] First, as I had indicated earlier, a renovation to the basement suite may be a capital improvement, in which case it would only be the interest on the loan that would be deductible, as opposed to the entirety of each loan payment. While the value of the improvement may be subject to a deduction based on the appropriate capital cost allowance amounts, the remainder of revenue would normally go into the recipient's income. [52] The second overarching concern relates to the expenses. As a general proposition, I accept the respondent's comment that a substantial portion of the expenses could contain a significant personal component. For income tax purposes, a taxpayer is entitled to organize their affairs as best they can, but for support purposes, the personal component should be added back in. The adding back in of personal‑use components of income often arises in the context of self‑employed individuals who may, for example, have only one cellphone or one vehicle. However, when the person's home is itself the business, questions regarding expenses and how those are treated are further amplified. [53] The respondent argues that I should not consider any of the expense claims unless I am satisfied that they have been proven. I agree that it is not possible to determine the reasonableness of all of the write‑offs. However, it does not necessarily follow that the expenses have not been proven as the respondent alleges. The expenses are arguably proven by the fact that she has deposed to the fact that she has incurred them and that her financial statement and tax returns are accurate. In other words, I may be able to find that the expenses were incurred. [54] The difficulty here is that the court has little information as to the gross amount of an expense, the portion of an expense that the claimant wrote off against income, and the portion that was treated as a personal expense. It is therefore difficult to determine a fair or appropriate basis upon which the court could add back into income the personal component for each of the expenses. [55] Further, I note the claimant has essentially three business enterprises, albeit somewhat related, that could be the subject of appropriate deductions: a) the rental of the upstairs suite in the summer months; b) the rental of the basement suite in the remainder of the year; c) and her business known as My Property Partner for which certain home expenses were claimed, at least in 2021. [56] The claimant says, through counsel, that she is able to provide explanations, but that she was never asked to do so in advance. For his part, the respondent says he asked for documents in December 2021, and only received the bundle of documents two days before his responding materials were due. As such, he had no opportunity to undertake any sort of analysis or to make further inquiry. [57] Finally, there is the respondent's suggestion that the claimant could have a minimum wage job, in addition to the rental income. He asks the court to infer that the rental business is largely a hands‑free operation, and points to the fact that she claims expenses for things like landscaping and cleaners. He says the upstairs suite is only rented 45 days per year, far short of full‑time employment. [58] A difficulty for parties on a review such as this is that it is not always obvious as to what might be significant in terms of the matters that are going to be argued at the review hearing. On this application, the court had the good fortune of two thorough and well‑organized counsel. There were two binders of affidavit material, plus a thorough written argument from each party. [59] As a general proposition, it is more efficient when the precise matters that will be in issue are identified in advance and that the parties give some consideration to how the court might be able to resolve those issues. In the circumstances here, I am not prepared to draw any adverse inferences against the claimant with regard to the determination of her income, because although the points raised by the respondent are legitimate questions, the fact is the claimant has not had an opportunity to answer them. As such, it would be inappropriate and unfair to draw an adverse inference from her failure to provide an explanation to questions that were never asked. [60] In all of the circumstances, I find that I am unable to properly determine an appropriate level of income to impute to the claimant. I acknowledge that the claimant has acknowledged that imputing an income of $30,000 would be appropriate, and it is not until the expenses are added to the point where her income exceeds $30,000 that it would make any difference to the analysis. However, my concern about both the reporting of income and treatment of expenses is that it could exceed $30,000. [61] Since spousal support is intended to address, at least in part, the differences in the standard of living between the two households, a material change in the amount of the claimant's income could be significant in the final outcome, unlike, for example, the decision of whether the two older children are children of the marriage. [62] I would expect that, at a minimum, the respondent will want to know how the various line items on the claimant's tax returns, as it relates to her business income and expenses, were calculated, which would include both the gross amounts and percentage or basis for determining the deducted portion. It may be that the claimant would need to speak to her accountant in order to answer some of the questions and that further document disclosure could be required. [63] Depending on the information received, the respondent may then choose to cross-examine the claimant, including questions in furtherance of his suggestion that she could obtain third‑party employment. [64] Whether cross-examination is required and what form it might take, either inside or outside of a courtroom, is something the parties will need to address and we will return to this at the end of my decision. Children of the marriage [65] As I said earlier, the parties have four children and it is conceded that the younger two have continued to be children of the marriage. I will now address the older two. Child 1 as a child of the marriage [66] Child 1 graduated from high school in June 2018 and started a business administrator program at Okanagan College. He failed a couple of his courses and then transferred to Columbia Bible College in Abbotsford in September 2019. He remained there until the beginning of March, when the COVID pandemic caused the closure of all in‑person learning, and Child 1 returned to the Westridge Home. [67] In September 2019, the respondent decided to unilaterally pay child support directly to Child 1 as opposed to paying the claimant. When I say unilaterally, there was no discussion and I was provided with no basis as to how the amount was determined. Child 1 was not eligible to receive CERB benefits because he had been a student. He attempted to find work in the summer of 2020 and ultimately found part‑time work as a delivery driver for Domino's Pizza. He earned $11,608 in 2020 and in 2021, he subsequently enrolled in one online course and earned $14,627 during 2021. He left his employment and returned to Okanagan College in January 2022, and is taking three courses. He is not working at the present time, but just recently obtained a new job. Child 2 as a child of the marriage [68] Child 2 is currently 20 years of age and suffers from anxiety and depression. She presently is attending an online school program at QC College of Design studying interior decorating. Child 2 received CERB benefits for 2020 and 2021 totalling $14,000 each year. FMEP ceased enforcing child support for Child 2 in February of 2021. Counting employment income, Child 2 earned $23,431 in 2020, and $19,819 in 2021. Legal Test [69] The legal test for whether or not a child is a child of the marriage is set out in the Divorce Act, and in particular, the definition of "child of the marriage" is in section 2 which reads as follows: child of the marriage means a child of two spouses or former spouses who, at the material time, (a) is under the age of majority and who has not withdrawn from their charge, or (b) is the age of majority or over and under their charge but unable, by reason of illness, disability or other cause, to withdraw from their charge or to obtain the necessaries of life; [70] Relevant to this case is subsection (b). [71] As the Court of Appeal said in Dring v. Gheyle, 2018 BCCA 435, paragraph 49: [49] . . . At age 19, a child is an adult who, generally speaking, must support himself or herself. To remain a "child" for support purposes, the adult child must be unable to withdraw from his or her parents' charge, or unable to obtain the necessaries of life because of illness, disability or another reason . . . [Emphasis in original] [72] It has long been the law that pursuing post‑secondary education constitutes an "other reason" for the purposes of this section. [73] The court has also identified the following factors as helpful in determining whether or not an adult child remains a child of the marriage, which factors are often referred to as the "Farden" factors from the court's decision in Farden v. Farden, (1993), 48 R.F.L. (3d) 60: (1) whether the child is in fact enrolled in a course of studies and whether it is a full-time or part-time course of studies; (2) whether or not the child has applied for or is eligible for student loans or other financial assistance; (3) the career plans of the child, i.e. whether the child has some reasonable and appropriate plan or is simply going to college because there is nothing better to do; (4) the ability of the child to contribute to his own support through part-time employment; (5) the age of the child; (6) the child's past academic performance, whether the child is demonstrating success in the chosen course of studies; (7) what plans the parents made for the education of their children, particularly where those plans were made during cohabitation; (8) at least in the case of a mature child who has reached the age of majority, whether or not the child has unilaterally terminated a relationship from the parent from whom support is sought. Discussion Child 1 [74] The claimant says that Child 1 has remained a child of the marriage throughout. He has never earned enough money to be self‑sufficient and, other than the approximately seven months when he was in Abbotsford, he has lived in the Westridge Home. [75] The respondent says that Child 1 is no longer a child of the marriage and has not been since he stopped attending school in March 2020. He points to the fact that Child 1 is now 22 years of age and has only now chosen to return to the college program part‑time. He initially failed two classes and dropped out of one, and barely passed two others when first in the business program, and little information has been provided with regard to his academic program at Columbia Bible College. Since then, he has not been enrolled in school full‑time and, as I said before, was enrolled in one online course in 2021 and three courses at the beginning of 2022. [76] Child 1's intention is to return to school full‑time starting in September 2022. [77] I do not accept that Child 1 was a child of the marriage once he was working and not attending school. The test is not whether the child earns enough to live alone; rather, it is whether the child is unable to withdraw from the parents' charge. [78] I do not consider it unreasonable for Child 1 to pursue a business degree from Okanagan College at this point, and perhaps a more gradual return to full‑time study was prudent given the history. However, he has only taken one online course and three in‑person classes during the past two years when he has earned approximately $25,000, since he was able to find employment following his return to Kelowna and has recently found a job for the summer. [79] It may well be that Child 1 will return to full‑time schooling in September as suggested. If so, he would presumably return to being a child of the marriage at that time, at which point some analysis of his income and expenses would likely be appropriate. However, I do not find him to be a child of the marriage at the present time. [80] The only input remaining for counsel's calculations regarding Child 1 is when he ceased to be a child of the marriage in 2020. His school program shut down in March 2020 at the start of the pandemic. I accept that it was unrealistic to expect that Child 1 would find a job right away. Even those who had jobs had difficulty keeping them as layoffs were prevalent, especially in minimum‑wage and service industry parts of the economy, so to expect someone to find a new job right away in that economy is unrealistic. I accept that he would not have been able to withdraw from his parents' charge for a time. [81] Child 1 got a job in the summer of 2020 and therefore I find that he ceased to be a child of the marriage effective August 1, 2020. Child 2 [82] Child 2 has not returned to full‑time education since high school and, although she lost her job on account of the pandemic, she was eligible to receive CERB benefits. [83] Recognizing that the claimant bear the burden of proof, the evidence does not satisfy me that Child 2's current educational program, which is a single, self‑directed online course, precludes her from earning an income and there is no medical evidence to suggest that she is incapable of doing so. [84] I therefore accept that Child 2 ceased to be a child of the marriage upon turning 19. The respondent's income [85] In 2019, the respondent's position at Devon Energy was terminated as Devon was purchased by CNRL. He received a severance package, even though he remained ostensibly at the same site and doing the same work. He was, however, requested to relocate to Calgary, which he did. [86] His income for 2019 was $405,220. However, the respondent says a portion of this was because a stock benefit immediately vested as a result of CNRL's buyout of Devon Energy, forcing him to recognize approximately $100,000 in additional income. Approximately $40,000 of the shares were sold in order to cover the associated tax. The remaining shares were placed in a tax‑free savings account and over the course of approximately a year, the value of the shares dropped in half. Because the shares were held in a TFSA, the respondent was not able to deduct from his income any loss in their value. The respondent says that some adjustment ought to be made when considering his appropriate Guideline income for 2019. [87] In 2020, the respondent earned $218,913 at CNRL. He remained at that position until the end of the year when he accepted an offer from Syncrude. At Syncrude, his base income was $210,000 and he was also entitled to a 14‑percent Fort McMurray regional allowance equating to $32,000 per year, and a one‑time mortgage assistance benefit of $40,000. He also realized a final paycheque from CNRL in the amount of $34,000. The respondent argues that the mortgage assistance benefit of $40,000 is a one‑time benefit and the court need not take it into account. [88] In early 2022, the respondent accepted a new position with Greenfire Resources. The position has a lower base salary but a potential for higher bonuses. His new base salary, when adding a premium for his qualifications and a Fort McMurray living allowance, equates to approximately $210,000. However, his contract with Syncrude obligates him to repay the mortgage assistance benefit as he did not remain with them for five years as contemplated in his employment contract. [89] The claimant argues that every time the court is asked to decide the respondent's income, he leaves his job, thus resulting in uncertainty surrounding his future income and eligibility for bonuses, which generally constitute a significant portion of his remuneration. Discussion Income in prior years [90] The starting point for determining the respondent's income is his line 150 income on his tax returns. [91] For 2019, I do not accept the respondent's argument that the vesting of his stocks in Devon Energy ought to be ignored, or alternatively that his income ought to be adjusted downwards. [92] If a recipient does not actually receive funds that are necessarily included in a tax return, the court may disregard the income. However, this is not a case like Brown v. Brown, 2014 BCCA 152, where the payor received shares from an employer and dividends were generated, but were used to pay for the shares. In that case, the payor never actually received cash in hand and therefore could not use it for support purposes. The dividend was excluded because it was non‑discretionary and had to be used against the debt for the purchase of the shares. [93] Here the respondent received the shares and sold them. The $40,000 he paid for taxes simply reflects the appropriate level of taxation for the value he received at his level of income. While the respondent says the shares went down in value, the evidence suggests that they have somewhat rebounded in subsequent months, and there is no evidence to suggest that the respondent was unable to realize on the asset, albeit he may have sold them at some point. [94] As such, while I do not consider the realization of the shares to be a recurring source of revenue, and therefore I find that it should only be considered for the year it was received, as opposed to forming the foundation for any future imputation, there is simply no legal justification to disregard it. [95] I turn now to the mortgage assistance benefit of $40,000 that was included in the respondent's 2021 income. [96] The respondent argues that although he received the benefit, he will have to repay it as a term of his contract with Syncrude, and points to the contract in this regard. He says that it should be deducted from his income for 2021 for support purposes. [97] The timing of his recent change in employment is that if Syncrude requires repayment, it would not yet be due and no demand for repayment has yet been received. As such, the court is in the position that we know the mortgage assistance benefit was received in 2021, but we do not yet know if it will be repaid, either in whole or in part. There is no reason to suggest it will not be; it is simply an unknown. It would therefore not be appropriate to deduct it from the year it was received, given the uncertainty surrounding any repayment, and I decline to do so. [98] I therefore find the respondent's income to be, in 2019, $405,229; in 2020, $218,913; in 2021, $315,670. Income - prospective [99] I will next deal with the respondent's prospective income. I do not accept that the respondent has deliberately changed employment to muddy the waters. One of the changes was as a result of a corporate buyout and nothing to do with anything the respondent elected to do, and the evidence does not support an inference of some deliberate ploy. That said, even though the respondent's base salary is lower at his new job, I can only assume that he would not have taken this position unless he was satisfied that he would receive at least the same remuneration, if not more, than the job he gave up to take it. [100] At Syncrude, he received a T4 for $281,623, which included the 14‑percent Fort McMurray regional allowance, and the mortgage assistance benefit. I accept that the mortgage assistance benefit is not recurring, but I cannot reach the same conclusion with the Fort McMurray regional allowance. I therefore assume that his T4 income from Syncrude, as adjusted, would be $241,623. [101] At Greenfire, the contract of employment provides a base salary of 180,363.04, a Fort McMurray residence allowance of $18,000, a certification premium of $12,000, and a non‑taxable transportation allowance of $20,400. The contract also provides for an RRSP match of up to $10,000 per year, a share equity program, and contemplates discretionary bonuses that are paid in December of each year. [102] According to the respondent, the non‑taxable transportation allowance is because Greenfire does not provide transportation to and from the jobsite and it is to cover things such as flights and vehicle costs, including fuel and maintenance. At this point, it is not clear whether the respondent will receive any or all of the non‑taxable allowance, nor whether he will see a net gain from it. [103] As I indicated before, I infer that the respondent would not have accepted the job at Greenfire unless he expects to make at least the same amount as he did at Syncrude. In addition, the new position may obligate the respondent to repay the mortgage assistance benefit, which must therefore also be considered in assessing the respondent's income. Since the $40,000 mortgage assistance benefit would have been forgiven if he had remained at Syncrude for five years, the respondent has ostensibly made a decision to forego $8,000 per year by way of the potential repayment obligation. [104] I therefore conclude that the respondent must expect that his income at Greenfire will exceed $250,000 per annum in order to justify the move. Making some allowance for the transportation allowance, I find that the respondent's income is $260,000 for support purposes. Should the respondent be fined? [105] The claimant seeks an order imposing a fine against the respondent for his delay in providing his income information to the respondent. [106] I accept that the respondent was slow to provide materials to the claimant; however, he has an explanation. He previously retained counsel to deal with the matter, but previous counsel got into some difficulty with the Law Society and was absent from practice for a time. When the claimant filed an application for production of financial information, the respondent retained his present counsel, who provided all of the information within the time for the response to the application, and no court appearance nor order was ever required. [107] Moreover, the respondent's request for information from the claimant, while answered, nonetheless took some time to put together and without it, spousal calculations could not have been undertaken in any event. The claimant's application for a fine is therefore dismissed. [108] Subject to matters relating to the claimant's income, that concludes my decision. [109] Now, returning to the question of the claimant's income, I am hoping to come up with a process that is proportionate to what is in issue and will help answer the questions I identified that prevent me from making a decision. I was contemplating something along the lines of that the respondent would, by way of correspondence or otherwise, demand particulars or request information regarding how the expenses were determined, i.e., gross amounts and proportions and what was deducted and what was not, that further disclosure may be required. So, I would expect the process would start with the respondent requesting information. The claimant would then respond and then, depending on what remained to be determined, there may or may not be cross-examination which could be in the form of more like a discovery or it could be in court, it could be either. [110] So I am inviting comment, I guess is what I would say. [111] CNSL A. BOLAND: If I may, I do think that makes sense, Mr. Justice Wilson. Perhaps what I will do then is I will write a letter to my friend setting out the questions that I have in terms of the tax returns and the like. Upon receipt of it, I think it would be fair for my friend to look at it and decide whether ‑- what I do not want to do is create a whole bunch of work for everyone, including for Ms. Specht and her client, and have her buried in a request for information that takes a long time to answer. I mean, the answer may be better off provided in the context of later discovery, if we are going to do that anyways, in the sense it will be more efficient possibly for those responses to come orally than it will be in written form. [112] But I certainly am not married to that process, if my friend would prefer to do it by writing, I would be fine with that too. I am just trying to be sensitive to the costs involved for everybody, because we ‑- my friend and I are both very keen not to bury our clients in legal fees and make this process all counterproductive, so to speak. So I certainly think that it makes sense for me to put my inquiries into writing, and then I guess I am not sure what my friend thinks is easiest for her and her client at that point. [113] MS. SPECHT: I do agree with my friend. I think certainly if we have clear identification of what information is being looked for, just as Your Justice indicated, she can go back to her accountant and get all of those answers. So if we are talking the numbers, those are going to be things that I think would be effective for us to be able to answer in writing. If there's other questions that my friend has, he and I can discuss the things, would it be more suited to a short discovery, or something of that nature, he and I might be able to agree on that. And again, a cost‑efficient process to do it, as well, just in terms of whether it be by Zoom or something else, given my location. [114] CNSL A. BOLAND: Zoom makes sense. I am fully on board for that, and given your location, it would be pointless to do it in person. So definitely if we are doing it, I think, in examination for discovery format by Zoom, I cannot imagine I would need very long, if I would even need one at all. So I think, you know, probably makes sense I put the request in writing, Ms. Specht responds in writing, and then if there is anything to follow up, we can do a short examination for discovery if necessary. That makes sense to me. [115] MS. SPECHT: And then if we cannot come to resolution with respect to the claimant's income, I am assuming the court would envision us just coming back to court with that information? [116] THE COURT: Yes. [117] MS. SPECHT: And that is the other thing I was thinking, to my mind, it may be that, again, depending on the questions that are in dispute, either discovery or a short affidavit from my client, if that evidence is going to have to lead the way. So I am open to either, but I assume that's what the court's intent was, is that we return to court if we can't figure this out. [118] THE COURT: Yes, I was assuming that there would be a process whereby more information is available and then you either agree or, if not, you come back to court. Obviously how long you need will depend on what needs to be determined. It may be that all of the expenses have been treated in the same manner in terms of percentages or whatever it is, in which case it is only then a question of whether that is okay or not, as opposed to going through line by line. I do not know that, but ‑- so I do not know how long it will necessarily take, but I was anticipating that perhaps we set some timeframes around the initial letter request from Mr. Boland and the response, just so that we have some deadlines. If you do not think you need them then it does not matter to me. But I expect it makes it easier if there are dates in place for those first two exchanges. Then of course, if you cannot agree, then you would have to reset before me to determine what is essentially a single issue at that point, will be determination of the claimant's income. [119] CNSL A. BOLAND: I am happy to have a due date. I do not want this matter to drift as it has. I think nobody's fault, but we don't want it to linger. I would be able to provide a letter, I think, two weeks tomorrow. That is - I am just talking to you, Ms. Specht, that is realistic for me. Would that be okay? [120] MS. SPECHT: That is fine with me. I would not be able to attend to it sooner than that, just unfortunately my schedule. I would endeavour to get the response back to you within that same sort of time period, but I would maybe ask for discretion, if for some reason the accountant ‑- because I am just thinking of it being the accountant's sort of busy season, if there is a little delay because she cannot get the information, then I would ask discretion between you and I to make sure that we ‑- [121] CNSL A. BOLAND: Well, maybe if you would not put it as an order or anything like that, but we have denoted on the record and so the expectation is clear that I will get you a letter in about two weeks and then you will respond as your schedule permits, with the aim of another two weeks‑ish. [122] THE COURT: And frankly, if you think the accountant is going to be involved, you may not get a word out of them before May. I suspect that it might be easier to ask the questions than it is to find the answers, and so I would expect that it will be easier for Mr. Boland to put his letter together than it will be for Ms. Specht to answer it, and that the timeframes might be adjusted accordingly, but I will leave it to you with the expectation that certainly by no later than the end of May, you should know exactly where you are at in terms of exchange of information in writing. [123] CNSL A. BOLAND: I think that is very reasonable and doable, for myself at least, and I agree that it is always easier to demand for information than it is to answer it. [124] MS. SPECHT: And may I suggest, just to make [indiscernible], would Your Justice perhaps permit leave for us to attend a case management conference if for any reason there is something that we cannot resolve? [125] THE COURT: Yes, that is fine. If it is just a brief procedural thing, then yes, that is fine, you can request to appear through Scheduling and they will, if I am around, they will slot you in at 9:30 or nine o'clock or something. [126] MS. SPECHT: Thank you, I just think that ‑- again, I anticipate that if something did come up, it would be brief and procedural, but just a 10‑minute appearance to the court to solve any [indiscernible] ‑- [127] THE COURT: Yes. No, and it does not make any sense to have you applying before someone else when ‑- well, it is fresh in my mind now, I hope it stays there long enough that it is still fresh in my mind when you come back but it does not make any sense to send you off making applications when you can just do it by way of a quick appearance. [128] MS. SPECHT: Thank you, Justice. And for the completeness of the order, I am assuming that Your Justice would have that you are seized of any further application with respect to the determination of the claimant's income? [129] THE COURT: Yes. [130] MS. SPECHT: Obviously that makes sense, thank you. [131] THE COURT: Yes. It is really all part of the same application. [132] There was one other thing I was going to raise as well. You may not know your position until you are further through your process, but in terms of whether there would be any other ordered reviews or whether you would see what results from this as being the indefinite order, subject to material change. My hope is that it is that, that this ends up in an indefinite order that would then be subject to the usual material change body of authority, as opposed to another specific review date because I see that as a benefit of a more thorough process now. But if you think that there is some issue with that, then you can let me know when you make the final submissions. [133] CNSL A. BOLAND: I do not have instructions on that, although I think philosophically everyone has an appetite to have this be a more durable order than has taken place in the past, so it does make sense to make further submissions on that if necessary. But given Your Lordship's comments and orders about the parties' incomes, at that point whether there is any virtue in doing further annual reviews, I think is limited. [134] THE COURT: Yes. I mean, obviously obligation to disclose is still there and so it may be that what is contemplated ‑- and again, you can raise it at the time, is specific orders dealing with exchange of information which at least then gives the parties the information to determine whether they feel that some review might be appropriate. But ‑- [135] CNSL A. BOLAND: And the child support would be they are going to continue in any event for the [indiscernible] ‑- [136] THE COURT: Yes. [137] CNSL A. BOLAND: So there would be transparency, as least as far as that order goes, regardless of what takes place with the spousal support order. [138] THE COURT: Yes. All right. So I am assuming that there should be an order drafted out of what we have just done, so I will assume that you will work on that. If you do agree at some point, you have a consent order, obviously that is always (a) to be encouraged, but (b) just make sure it is directed to me to sign, since it is going to incorporate what I have just said. [139] THE COURT: All right. Anything else that would be of any use at this point? [140] CNSL A. BOLAND: Not from me, Mr. Justice Wilson. [141] MS. SPECHT: Not from my side either, thank you, Justice Wilson. [142] THE COURT: All right. Thank you very much. "Wilson J."