Wright v. Wright

2019 BCSC 1628 Wright v. Wright IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Wright v. Wright, 2019 BCSC 1628 Date: 20190926 Docket: E20066 Registry: Fort St. John Between: Carla Ann Wright Claimant And Percy Floyd Wright Respondent Before: The Honourable Madam Justice MacNaughton Reasons for Judgment Counsel for the Claimant: R. Gibbs, Q.C. Counsel for the Respondent: G. Whidden Place and Date of Trial: Fort St. John, B.C. August 7-9, 2019 Place and Date of Judgment: Fort St. John, B.C. September 26, 2019 Table of Contents The Procedural History. 3 The History of the Parties' Relationship. 4 Work History. 4 The Parties' Separation. 7 Mr. Wright's Evidence about the Agreement. 8 The Sale of Farside Concrete and other Transactions. 12 Ms. Fell's Evidence about the Agreement. 18 The Purchase of the Ewonchuk Home. 18 The Purchase of the 52nd Street Home. 21 Agreement with Respect to Maintenance. 22 Ms. Fell's Employment with Farside. 22 Farside's Company Value. 22 Summary of Mr. Wright's Version of the Agreement. 24 Assessment of the Credibility of the Evidence. 25 Next Steps. 30 The Procedural History [1] Carla Wright, who now goes by Carla Fell, commenced these proceedings by writ of summons and statement of claim on May 4, 2010. I will refer to the claimant as Ms. Fell in these reasons. [2] In her pleadings, and for the purposes of this decision, Ms. Fell sought a divorce, spousal support, a reapportionment of family property in her favour, compensation for family property disposed of by Mr. Wright post-separation, and property preservation and restraining orders with respect to family property and with respect to corporate assets held solely in Mr. Wright's name. [3] Concurrent with filing her family proceedings, Ms. Fell obtained a property restraining order from Justice Pitfield on May 4, 2010. By its terms, the restraining order expired on May 6, 2010, at 4:00 p.m., unless extended by further order of the court. For reasons discussed below, Ms. Fell allowed the property restraining order to expire. [4] Mr. Wright did not file a response to family claim until August 31, 2016. In Part D of his response, Mr. Wright said that the parties had entered into a "verbal agreement to divide all family property and for maintenance". Mr. Wright also filed a counterclaim seeking spousal support from Ms. Fell. [5] Ms. Fell adamantly disagrees that she and Mr. Wright ever reached an agreement with respect to the division of their property or maintenance. [6] On October 11, 2016, the parties entered into a consent property restraining order under s. 67 of the Family Relations Act, R.S.B.C. 1996, c. 128, which applied to family property and corporate assets. Ms. Fell alleges that Mr. Wright has breached the property restraining order, but that matter was not argued before me. As a result of an order made by Master Keighley at the June 27, 2019 trial management conference, the only issue I have to determine is whether the parties entered into a verbal agreement dealing with property and support. [7] At the commencement of the trial, counsel suggested, and I agreed, that as Mr. Wright has the burden of proving the oral agreement he alleges, I would hear his case first, and Ms. Fell would respond to it. [8] These are my reasons for decision with respect to the sole issue for determination. Only Mr. Wright and Ms. Fell testified. The History of the Parties' Relationship [9] Ms. Fell and Mr. Wright were married in Alberta on October 7, 1982. She was 15 and he was 16 years of age. At the time, Ms. Fell was expecting their first child. Neither Ms. Fell nor Mr. Wright graduated from high school. They started their life together with no assets. [10] The parties have four children, all of whom are adults. Lindsay was born on March 20, 1983, Clifford on March 20, 1986, Robert on May 5, 1988, and Sarah on January 25, 1994. [11] The parties separated in February 2009. Work History [12] For the first few years after their marriage, Mr. Wright worked as a construction labourer in Fort Nelson. At 18 years of age, Mr. Wright got his Class 3 driver's licence and, at 19, his Class 1 driver's licence. He worked for his father's business, C.F. Wright Transport, as a truck driver and equipment operator for four or five years. [13] On a date that was not clear on the evidence, Mr. Wright bought a logging truck with financial help from Wayne Fell, his father-in-law. For about the next three years, as an owner/operator and through a business called Carper Transport, Mr. Wright worked for Blue Canyon Concrete ("Blue Canyon"), Mr. Fell's company, hauling logs. [14] Ms. Fell was a stay-at-home mother to three of the parties' four children. In addition to her responsibilities with respect to the parties' children, Ms. Fell was involved in the administration of Carper Transport, including invoicing, paying bills, picking up parts, and dealing with the mail. Initially, Ms. Fell was not paid for her work with Carper. Mr. Wright testified that they both worked together to build the business. [15] On a date that was also not clear on the evidence, Mr. Fell sold his logging contract, and Mr. Wright sold Carper's truck. For approximately the next five years, Mr. Wright went back to work with his father, as an employee, building roads and logging. [16] In 1999, Mr. Wright's father sold all of his logging equipment and started operating a hydrocarbon contaminated soil farm. Mr. Wright took over his father's contract with the Slocan lumber mill to deliver the fall skid and wood. Mr. Wright assumed payments on one of his father's wood processing plants and started Farside Logging Contractors Limited ("Farside"). Mr. Wright was Farside's sole shareholder, but Ms. Fell worked with him in the business. Mr. Wright said that it was a family decision to start Farside. [17] During the approximately 100-day frost window in the Fort Nelson area, Farside transported cut trees and processed them into 16 or 32-foot lengths. Mr. Wright described the operations of Farside as the "weakest link of the logging industry", but he said he thought he could build the business from there. [18] The Farside business grew. Initially, it contracted out all of the other phases of the operation, but, over the course of almost ten years, it financed the purchase of more and more equipment, and began doing the majority of the tree falling, skidding, processing, loading, and hauling. [19] Mr. Wright testified that Ms. Fell helped in every aspect of the business, including doing parts delivery, office work, hiring employees, delivering employees to job sites, and arranging equipment financing. Mr. Wright said that both of their roles grew with the company. [20] In 2005, Mr. Fell approached Ms. Fell and Mr. Wright, offering to sell them part of his business. Mr. Fell and his brother owned Blue Canyon, which included both a Ready Mix concrete business and a gravel business. Mr. Wright said that he and Ms. Fell agreed to purchase the Ready Mix portion, on a rent-to-purchase basis, and they operated it as Farside Concrete, a division of Farside. In these reasons, I will use "Farside Logging" when referring specifically to the logging division of Farside. [21] Their eventual intent was also to buy the gravel side of the Blue Canyon business, as Mr. Wright testified that it was difficult to make money in concrete without a secure gravel source. [22] Ms. Fell managed the administrative side of the office, including invoicing, hiring, maintaining equipment safety, arranging equipment financing, and taking phone calls and orders. Mr. Wright said, "whatever she could possibly help with, she was helping" in both the logging and the concrete sides of the business. They logged in the winter and delivered concrete in the summer. [23] In 2008, Canfor purchased Slocan and, later that year, announced that it was closing the Slocan mills. On rumours of the shut-down, and to reduce Farside's debt load, Mr. Wright approached Ritchie Bros., a company specializing in the sale of used construction equipment, and asked it to appraise and sell Farside's equipment. Mr. Wright said that the mill closure gave Farside no choice but to sell. Farside Logging's equipment was financed, and while they could have paid the financing costs by operating some of the equipment "down south", he and Ms. Fell decided it was better to sell the equipment than to scatter it around B.C. [24] After the equipment sale in November 2008, Farside continued with the concrete business and obtained contract work cleaning up Canfor's campsites and deactivating its forestry roads. Mr. Wright and Ms. Fell continued to work long hours in the business. [25] By then, Farside was a diverse business in which both Mr. Wright and Ms. Fell worked, and through which they achieved a comfortable life style and acquired substantial assets. In cross-examination, Mr. Wright agreed that Farside was a multi-million dollar enterprise working in various fields including logging, cement, road construction, trucking, and camp operations. The Parties' Separation [26] The parties separated in February 2009. Mr. Wright left the family home, located at mile 302 on the Alaska Highway (the "family home"), with the parties' daughter Sarah and moved into a rented duplex in Fort Nelson. Mr. Wright said that he never discussed reconciling with Ms. Fell and that, when he made up his mind to leave, he had no intention of coming back and he told Ms. Fell that. [27] Ms. Fell testified that Mr. Wright told her that he was leaving the family home because he needed time to "work on himself". She said that Mr. Wright told her that they would get back together. They were having trouble with Sarah, then a teenager, and Mr. Wright said he wanted to take her and figure some things out for himself, and they would both be back. [28] Ms. Fell testified that, for the rest of 2009, she and Mr. Wright took a lot of trips together and did things as a couple with their friends and children. Mr. Wright travelled without her; she believed that he was trying to figure things out. [29] In cross-examination, Mr. Wright denied that at separation and for some time thereafter, he told Ms. Fell that he just needed some time to work things out for himself and that they would get back together. He testified that that "was not the way [he saw] it". However, Mr. Wright acknowledged that after separation, he and Ms. Fell continued to take trips together. He agreed they had taken a return trip to Alberta through Golden, during which they slept together. They attended a 2009 Canucks playoff game in Vancouver, during which they slept together. Ms. Fell took him to Prince George for treatment for a knife wound. Ms. Fell took him to Vancouver, in the late fall or early summer of 2009, for surgery on his nose. He also agreed that they took numerous trips in the summer of 2009, picnicking, fishing, and river boating with friends on the Tuchodi River. Mr. Wright denied that they went on the river trips as a couple, but acknowledged that they were with family and friends. [30] I am satisfied, on the evidence, that Mr. Wright caused Ms. Fell to believe that their separation was temporary and that they would get back together. That is the only reasonable inference to be drawn from the evidence that, after separation, they socialized, travelled, and slept together, and that Ms. Fell helped Mr. Wright to deal with medical difficulties. Mr. Wright's Evidence about the Agreement [31] Mr. Wright testified that, over a period of time, which he estimated to be two years, he and Ms. Fell reached an agreement about the division of their property and about maintenance. He said that the only way they could divide things was to sell everything and divide the proceeds equally. However, Ms. Fell wanted to keep the family home, and he wanted to keep the Farside Logging business. To effect that, they decided to sell Farside Concrete and divide the proceeds. Thereafter, he would keep Farside Logging, and Ms. Fell would keep the family home and assume responsibility for the mortgage. [32] Mr. Wright testified that he and Ms. Fell reached various verbal agreements throughout the two years they negotiated. In cross-examination, he acknowledged that there was never a point at which he and Ms. Fell agreed that all matters between them were sorted out. [33] In cross-examination, he acknowledged that, at his January 16, 2018 examination for discovery, he said that he and Ms. Fell reached an agreement in 2010, shortly after the writ was issued. They discussed everything during the following few weeks and "worked it out". [34] Ms. Fell vehemently disagreed that any agreement was ever reached between her and Mr. Wright. She said that things were not really up for discussion. Mr. Wright did not ask her about the moves he was making; "he just did what he wanted to do." [35] Mr. Wright testified that they did not discuss specific assets or assign values to property; they had general discussions. Mr. Wright described that their agreement was complicated. The Farside Logging business was ongoing; they were still buying and selling equipment and doing business apart from the concrete business. [36] Mr. Wright testified that, up until October or November 2009, he and Ms. Fell discussed that they would both pay for the household expenses. He said that they jointly had "ongoing discussions about how to deal with everything", and that, to the best of his knowledge, Ms. Fell agreed. She "never showed [him] that she did not agree". [37] Mr. Wright testified that during the parties' negotiations, they agreed that he and Ms. Fell would each receive the same salary from Farside until they worked everything out. [38] The Farside payroll journal (now under the name of Brookside Resort Ltd.) shows that, from the date of separation until the end of September 2009, Ms. Fell was being paid gross wages of $2,100 bi-weekly and Mr. Wright was being paid gross wages of $3,400 bi-weekly. Commencing on October 2, 2009, Ms. Fell and Mr. Wright each began receiving gross wages of $3,400 bi-weekly. Mr. Wright described the salary increase as part of the deal that he and Ms. Fell reached. [39] Prior to separation, both Mr. Wright's and Ms. Fell's pay cheques from Farside were paid into their joint CIBC account from which household expenses, such as the mortgage payments and utilities, were paid. Mr. Wright continued to deposit his pay cheque into the joint account until November 2009, after which he opened his own bank account at the North Peace Credit Union. He suggested that Ms. Fell's salary was increased as a part of their negotiations and to cover the fact that he was no longer contributing to the household expenses. [40] Ms. Fell testified that, after Mr. Wright left the family home, he was not as involved in the business and she ran the business without him. She testified that she never understood why she earned less than Mr. Wright, but as he was barely working, and she was running the day-to-day operations, and was incurring expenses for the family home and for the Ewonchuk home (discussed below), she needed more money and asked Mr. Wright to increase her salary in October 2009. In cross-examination, Ms. Fell denied that it was part of an agreement that after her salary increased to $3,400, Mr. Wright would stop depositing his paycheque into their joint account. [41] In cross-examination, Mr. Wright testified that increasing Ms. Fell's wage to $3,400 would have been part of the agreement they made. He said that "it was an open conversation on stuff". When asked in cross-examination, Mr. Wright agreed that when he and Ms. Fell were working together as partners, and each was contributing to the business, Ms. Fell had accepted him earning more than she did. However, after the separation, she no longer felt that was fair. When it was put to him that Ms. Fell discussed her wages with him, he responded that he "guess[ed] so, but the way [he] remembered it, it was part of [their] deal". [42] The evidence does not support a conclusion that the increase in Ms. Fell's wages in October 2009 was part of a deal. [43] Mr. Wright testified that, in addition to Farside and the family home, he and Ms. Fell owned: a holiday trailer; a camper; three snowmobiles; a four wheeler, side-by-side, off-road vehicle; a boat; miscellaneous tools in a workshop; a greenhouse; a couple of pick-up trucks; paintings and household contents; a ruby and an emerald, which they had purchased as an investment; an office trailer; and an insulated storage container. [44] He said that Ms. Fell was adamant that she wanted to keep all of these items and he, "was okay with that--that was part of the deal. She kept that stuff which didn't mean much to [him]. She wanted to keep it." [45] Mr. Wright testified that they never had any of their personal assets appraised, but they had numbers that they "kind of" agreed with. He could not specifically recall their discussions, or the estimates of value on which they based their agreement. He said that he would propose a value and Ms. Fell would tell him whether she wanted to keep the item at that value or propose another. There are no written records of any of their discussions. [46] Mr. Wright testified that they also never had the family home appraised, but estimated that $650,000 was a fair value. Mr. Wright had no specific recollection of their discussions about the value of the family home. It had been built by Ms. Fell's father. A neighbour told them that, at $650,000, he would be interested in buying it. [47] Mr. Wright acknowledged that the family home was mortgaged. In her evidence, Ms. Fell said that she believed that the mortgage was for about $350,000 and that she paid it. Title to the family home was only transferred to Ms. Fell in August 2019. She testified that Mr. Wright would not agree to sign it over to her before that. She testified that Mr. Wright would also not sign mortgage renewal documents but, as the bank knew that she was making the payments, it renewed the mortgage without Mr. Wright's signature. [48] With respect to the holiday trailer, Mr. Wright testified that it had been bought 15 years before, and they knew what they had paid for it. Although he had a general recollection of their discussions, he had no specific recollection of the discussion about the trailer or any other asset. [49] Ms. Fell testified that after she and Mr. Wright separated, he sold a riverboat, which had been stored at the family home, to someone called Ray Dennehey (phonetic). She asked Mr. Wright where the money from the sale had gone. Some time afterwards, a boat belonging to Mr. Dennehey showed up at the family home. Ms. Fell said that she was unable to use Mr. Dennehey's boat because she was not given a bill of sale for it and could not insure it. [50] Ms. Fell testified that Mr. Wright took the Hammerhead jet boat that they had bought while they were together and never accounted for it. [51] It appears, from Mr. Wright's evidence in cross-examination, that at some point, he traded the riverboat to Mr. Dennehey. His evidence was that the riverboat was damaged and an insurance claim had been filed. Mr. Wright ordered another boat (presumably the jet boat) and bought the riverboat from the insurer. Mr. Dennehey suggested trading his boat for the riverboat, and he took the riverboat and repaired it. Mr. Wright testified that the trade was arranged between him, Ms. Fell, and Mr. Dennehey. He agreed that, after the trade, the riverboat continued to appear on Farside's financial statements. [52] He said he did not recall Ms. Fell confronting him about transferring the riverboat to Mr. Dennehey. The Sale of Farside Concrete and other Transactions [53] On a date that is unclear in the evidence, Mr. Wright testified that Larry Fell, Wayne Fell's brother and his partner in Blue Canyon, told him that he would never sell Mr. Wright the gravel portion of the Blue Canyon business. Ms. Fell was not present for these discussions, but Mr. Wright told her about them. [54] Mr. Wright said that he and Ms. Fell could not stay in the concrete business without owning a gravel source. He also testified that Fort Nelson had been growing for 15 years and he believed that the growth was bound to slow down. He testified that Ms. Fell agreed they should get out of the concrete business. [55] On a date that is also unclear on the evidence, but which Mr. Wright agreed in cross-examination could have been in 2008, Mr. Wright attended a B.C. Ready Mix convention in Vancouver. He told a representative of LaFarge, the company from which Farside purchased powdered concrete, that he was interested in selling the concrete division. [56] Mr. Wright did not market the concrete business. He relied on word of mouth. The Lafarge representative suggested that Interoute Construction Ltd. ("Interoute") might be an interested purchaser. Wayne Fell was also interested, as was Rocky McLeod, one of Mr. Fell's original business partners. [57] On February 9, 2010, Interoute and Mr. Wright signed a confidentiality agreement with respect to the disclosure of documents and financial information for the purpose of negotiations. For a period of 60 days, Farside agreed that it would not negotiate with other prospective purchasers. Ms. Fell was not a signatory to the confidentiality agreement. [58] Together, Mr. Wright and Wayne and Larry Fell met with representatives of Interoute because Interoute was then interested in buying both Farside Concrete and Blue Canyon's gravel source. Interoute never finalized its negotiations with Blue Canyon. [59] On April 14, 2010, Rocky McLeod and Randy Saugstad signed a letter of intent setting out the general terms on which they had offered to purchase Farside Concrete, as a going concern, for $1.5 million, effective June 1, 2010. Whether the sale was to be a share sale, an asset sale, or a combination of the two, was to be decided. The discussions were subject to Mr. McLeod obtaining financing. Apparently, financing was not forthcoming. [60] Mr. Wright testified that the employees of Farside, including Ms. Fell, knew that he was in discussions with potential purchasers for the concrete division. [61] Ms. Fell was adamant that she was not aware that Mr. Wright was trying to sell the concrete division until she found a copy of Mr. McLeod's and Mr. Saugstad's letter of intent on the fax machine at Farside. She said that she had no idea what was going on. When she asked Mr. Wright about what was going on, he would not say. She agreed that there were people coming and going out of Farside, but said that was not unusual and she was never introduced to them. [62] Ms. Fell testified that after separation, and until about May 2010, the parties continued to run Farside together, but that Mr. Wright was becoming secretive. He stopped talking to her and did not tell her where he was going. He would disappear without telling her, and, in April 2010, she learned that he had gone to Las Vegas with his girlfriend when she understood that he was at a Ritchie Bros. auction. [63] On May 4, 2010, Ms. Fell commenced these family proceedings and obtained the temporary property restraining order. [64] Mr. Wayne Fell served Mr. Wright with the family proceedings on behalf of Ms. Fell, including a copy of the property restraining order and Ms. Fell's May 4, 2010 affidavit. In her affidavit, the contents of which she adopted at trial, Ms. Fell said that she found Mr. McLeod's letter of intent on the fax machine in the Farside office. As a result of it and other "secretive" decisions Mr. Wright was making with respect to the business, she wanted to prevent Mr. Wright from selling the concrete division. She testified that she had no idea that Mr. Wright was trying to sell the concrete division, and that she never agreed to the sale. Her position in that regard has not changed since her May 2010 affidavit and was not shaken in cross-examination at trial. [65] Mr. Wright testified that he believed that one of the things that led Ms. Fell to commence family proceedings was the fax from Mr. McLeod. Despite that, he said that he and Ms. Fell had numerous discussions about selling Farside Concrete. [66] In cross-examination, he testified that he assumed that she faxed the McLeod offer to their accountant and therefore was fully aware of it. He agreed that he was the one who was having discussions with Mr. McLeod and Mr. Saugstad, but said that he would not have had the information about the equipment listed in the letter of intent. He would have relied on Ms. Fell for that information. [67] Shortly after Mr. Fell served Mr. Wright with the family proceedings, Mr. Wright said that he received a call from Ms. Fell who told him that, after talking to her father, she had "called it off". Mr. Wright said that they would try and work it out and Ms. Fell expressed an interest in buying the concrete division. [68] Ms. Fell testified that her father spoke to her about the temporary restraining order. Mr. Fell had spoken to Mr. Wright, and Mr. Fell told her that Mr. Wright could not do business with his hands tied, and that Mr. Wright would treat her fairly; they did not have to involve lawyers, but could come up with an agreement. Mr. Fell told Ms. Fell that he would be willing to talk to them both. Ms. Fell said that she was upset but, based on Mr. Wright's position that he would treat her fairly and that things would be done "correctly", she allowed the restraining order to lapse. [69] Mr. Wright testified that he had no problem with Ms. Fell buying the concrete division, so long as he was no longer responsible for the personal guarantees he had signed for the equipment. Ms. Fell said that Mr. Wright told her that she had 24 hours to come up with a proposal that relieved him of his guarantees. [70] In cross-examination, Ms. Fell testified that she was "pretty sure" she could have obtained the necessary financing from her father, but not within the 24-hour window she was given. [71] Mr. Wright recalled discussing the possibility of Ms. Fell purchasing the concrete division, but did not recall giving her a 24-hour deadline. He agreed that she had the experience and ability to operate Farside Concrete. [72] Mr. Wright acknowledged that he also had discussions with Mr. Fell about his interest in buying Farside Concrete. In cross-examination, Ms. Fell was asked about her father's interest in buying Farside Concrete. She said that she was his daughter, not his business partner, and was not involved in his business plans. [73] Ultimately, Mr. Wright accepted the Interoute offer, which proceeded as an asset sale for $1.5 million. Interoute purchased Farside's batch plant, silos, cement mixers, gravel trailers, and all the accessories for concrete forms for blocks and curbing. [74] Ms. Fell testified that she and Mr. Wright had not discussed a sale to Interoute and she suspected that Interoute knew nothing about her involvement in the company. She believed that Mr. Wright worked with Farside's bookkeeper to effect the sale. Ms. Fell was not involved in cancelling the insurance on the equipment or transferring title into Interoute's name. [75] As part of the sale, Mr. Wright agreed to work for Interoute as a manager of the concrete business for five years. He resigned after four months because he did not get along with the people he worked with. [76] Farside's general ledger indicates that, after all the debt on the equipment was paid, it received $528,647.85 from Interoute. The money was deposited into Farside's account on December 17, 2010. Some of the proceeds were used to pay off Farside's other debt, including to Lafarge for concrete powder. Mr. Wright testified that he understood that Farside received about a $300,000 profit from the sale to Interoute. [77] Mr. Wright testified that, after the sale of the concrete division, there was no work for Ms. Fell with Farside. What remained of Farside was a "picker" truck (otherwise described as a crane truck), a winch truck, a "cat" (which I took to mean a Caterpillar) and hoe, and a logging camp (the "Patry camp"). Farside also had some ongoing contracts. [78] Ms. Fell disagreed. She testified that, after the sale, Mr. Wright sent her to work at the Patry camp. A crushing crew had rented the camp, and she readied the camp for them, including "whipper snippering" the yard, helping the carpenter who repaired the stairs and the deck, painting the camp buildings, and checking the generators daily. The camp equipment had been stored in boxes and, together with Sarah, she washed all the sheets and set up the camp. Ms. Fell said that she also did some road deactivation for Farside. She agreed that she did not work full days, but said she was at the camp all the time. At different times, Mr. Wright stayed at the camp with her. [79] Mr. Wright denied that Ms. Fell ever worked at the Patry Camp. He said he would have known if she had been working there. [80] In cross-examination, Ms. Fell agreed that in addition to working at the Patry camp, she accepted other work to keep busy. She said that she was confused and upset about the way she was fired, that Mr. Wright left her without any money to get a divorce, and that she was scrambling to pay the mortgage on the family home. Ms. Fell disagreed that Farside continued to pay her a salary as a payout of her share of the proceeds of sale of the concrete division. [81] Mr. Wright testified that he and Ms. Fell continued their discussions about the division of their assets after the sale of the concrete division. They agreed to a value of $300,000 for the concrete division. He testified that they agreed that Farside would continue to pay Ms. Fell wages and pay her credit card bills until her share of $150,000 was paid. He said that the division they agreed to was "as fair as we thought we could get" because it went over a number of years. He testified that Ms. Fell would pay less tax if she took her share of the proceeds as income. He did not say who gave them that advice. [82] In her May 4, 2010 affidavit, Ms. Fell also complained that Mr. Wright had sold a picker truck, which was an asset of Farside, to Dennis Large. Mr. Wright was cross-examined about that transaction. He testified that Farside had bought the picker truck to help with the concrete division and to use for the contract Farside had to clean up three Canfor sites. He said that Mr. Large cleaned up the sites, and the bill for the work was $50,000. Instead of paying him, Mr. Wright agreed that he would give Mr. Large the picker truck. He testified that because Ms. Fell worked in the Farside office, she must have known about the sale. [83] Mr. Wright was cross-examined about Ms. Fell's sworn evidence that, in early 2010, he removed $20,000 from their joint personal bank account. She swore that, when she confronted him about it, he told her he had used it to buy a trapline. Mr. Wright denied that he had withdrawn the money. However, he acknowledged that he had bought the trapline and said he did so with funds from the Farside account. When asked whether he did it without telling Ms. Fell, he said that he "didn't know that she didn't know". He said she worked in the office and she saw all of the transactions. He agreed that he did not tell her about the trapline. The purchase of the trapline is not apparent in Farside's financial statements from 2009-2012. Ms. Fell's Evidence about the Agreement [84] Ms. Fell disagrees that she and Mr. Wright reached an agreement with respect to their family property and maintenance. She testified that she ended up with debt and no money. She said that they did not discuss anything, and that she knew enough to have insisted on appraising the family property. [85] Ms. Fell also testified that she did not know anything about the sale of Farside Concrete to Interoute. Mr. Wright did not tell her about the potential offers he was considering. She learned of the sale after it was finalized, when Mr. Wright told her that he had sold the concrete division and he would run it for the purchasers for a while. [86] Following the sale of Farside Concrete, Mr. Wright sent her to work at the Patry Camp, which they had bought from Canfor after the mill closed. She went there to get it up and running: cleaning it, washing sheets, and getting the caterers in. She testified that she worked there until the end of September 2011, when she was fired by Farside. Ms. Fell testified that in October 2011, she went to Farside to pick up her September paycheque and it was not there. The bookkeeper told her that she would have to speak to Mr. Wright, but when she tried to reach him, he had gone boating. The Purchase of the Ewonchuk Home [87] Mr. Wright testified that on June 24, 2009, approximately four months after separation, he and Ms. Fell purchased a home at mile 306 on the Alaska Highway from Dennis Ewonchuk (the "Ewonchuk home"). At the time, Mr. Ewonchuk and his spouse, Leah Ewonchuk (then Leah Underwood), were in jail for drug and weapons offences. Mr. Ewonchuk was arrested in March 2009. In December 2009, he was sentenced to prison for five and a half years. [88] Mr. Wright said Mr. Ewonchuk's mother approached him for help, and that he and Ms. Fell agreed to buy the Ewonchuk home, or "to switch it into our name", until Mr. Ewonchuk's affairs were in order, and then switch it back. The transfer appears to have been done to avoid forfeiture of the Ewonchuk home. [89] Mr. Wright agreed that he was not close to Mr. Ewonchuk or his wife, and did not owe them a favour. He agreed that, when the property was sold in February 2011, the funds went into his joint account with Ms. Fell and that he then removed it all. He testified that Ms. Fell knew it was going to happen and where the money was going. [90] In cross-examination, Mr. Wright acknowledged that it did not make any sense for Ms. Fell to agree to carry the cost of the Ewonchuk home while the Ewonchuks were serving their jail sentences, and then give the Ewonchuks any profit that was made on an eventual sale. [91] The Ewonchuk home was purchased for $285,000, and title was registered in both Mr. Wright's and Ms. Fell's names. It appears that no money exchanged hands, but that Mr. Wright and Ms. Fell either took out a mortgage or assumed the payments on the Ewonchuks' mortgage. Mr. Wright testified that he was paying rent on premises at the time, and he could carry the Ewonchuks' mortgage for about the cost of his rent. He testified that he got talked into the arrangement, and did not feel smart about it. [92] Ms. Fell testified that the purchase of the Ewonchuk home was presented to her as an investment opportunity. The home was close to the family home, and was up for sale as a result of the Ewonchuks' situation. She did not know Leah Ewonchuk. She met Dennis Ewonchuk when he assisted her and Mr. Wright after their boat broke down. She did not really know him. [93] The expenses for the Ewonchuk home came out of the parties' joint account. [94] Mr. Wright lived in the Ewonchuk home with the parties' daughter Sarah and his girlfriend, Ms. King, until it was sold on February 16, 2011, for $430,000, a profit of approximately $145,000 in less than two years. Mr. Wright and Ms. Fell did not share the profit. Instead, the sale proceeds were deposited into an account held jointly by Mr. Wright and Leah Ewonchuk, and then removed by Ms. Ewonchuk. [95] Ms. Fell testified that Mr. Wright came to her and told her that he wanted to sell the Ewonchuk home. She disagreed, but Mr. Wright said that she would be on the hook for the mortgage. She was told that she would be getting half of the approximately $145,000 in profit, but Mr. Wright took it all. She was never consulted about the profit being given to Ms. Ewonchuk, or told that the arrangement was that any increase in the value of the property would belong to the Ewonchuks. [96] In cross-examination, it was put to Ms. Fell that Dennis Ewonchuk sold her his truck for less than market value as a thank-you for helping with the house. Ms. Fell denied that she bought the truck from Mr. Ewonchuk. She testified that he was in jail at the time and was going to lose the truck because he was not making the payments for it. She negotiated with Ford, the company from which Mr. Ewonchuk had bought the truck, to take over the payments. Mr. Ewonchuk's mother, who had his power of attorney, signed off on the deal so that Mr. Ewonchuk's credit would not be impacted. [97] Ms. Fell denied that the purchase of the Ewonchuk home and Mr. Ewonchuk's truck were part of an overall agreement to assist the Ewonchuks. Ms. Fell testified that there was never any agreement. She ended up with the bills and no money, and asked, rhetorically, why she would agree to that. [98] It is of note that Mr. Wright did not testify about the purchase of Mr. Ewonchuk's truck. He did not say that it was part of an overall deal. [99] Mr. Wright's explanation of why he entered into the transaction to buy the Ewonchuk's home was not credible. He testified that he did not know Dennis or Leah Ewonchuk. He was acquainted with Mr. Ewonchuk's mother, but, apparently, was not good friends with her. This is not a rational explanation for giving a $145,000 gift to relative strangers. [100] It is also of note that, on July 15, 2011, after her release from jail, Farside hired Leah Ewonchuk and paid her $3,400 bi-weekly--the same salary Mr. Wright and Ms. Fell were receiving. Mr. Wright testified that Farside was looking at investing in a licensed marihuana business, and he hired Ms. Ewonchuk to look into this opportunity. He agreed that he had no idea whether Ms. Fell knew about him hiring Ms. Ewonchuk, or the proposed investment. In September 2011, Farside also hired Mr. Ewonchuk. The $3,400 previously paid to Ms. Ewonchuk was split between them, so that they each received $1,700. Nothing ever came of the investment opportunity, and the only evidence about the Ewonchuk's experience in growing marihuana was the illegal grow-op for which they were convicted. The Purchase of the 52nd Street Home [101] Mr. Wright testified that once the Ewonchuk home sold, he bought a property on 52nd Street in Fort Nelson. He took $307,000 out of Farside's accounts, after the sale of the concrete division, to complete the purchase. Farside's general ledger indicates that $307,806.02 was paid out to Mr. Wright as a shareholder's loan on January 27, 2011. [102] Mr. Wright testified that it had not been a good idea for Sarah to live at the Ewonchuk home and that it was in her interest to move to Fort Nelson, where she could walk to high school and go home when she was not in class, which would keep her out of trouble. [103] In cross-examination, Mr. Wright acknowledged that Ms. King moved into the 52nd Street home with him. [104] Ms. Fell testified that she heard rumours that Mr. Wright had purchased a property on 52nd St. and that he was living in it with his girlfriend. She agreed, in cross-examination, that Sarah might have lived there for some of the time, but said that she spent most of her time at her boyfriend's home and that, at a later date, another boyfriend moved in with her at the 52nd Street home. Agreement with Respect to Maintenance [105] With respect to child and spousal support, Mr. Wright said it was his understanding that he and Ms. Fell agreed that he would not ask for child support for Sarah, and Ms. Fell would not ask for spousal support. [106] This is the only evidence I heard about this term of the agreement alleged by Mr. Wright. No support was ever paid. Ms. Fell's Employment with Farside [107] Mr. Wright testified that Ms. Fell was laid off by Farside at the end of September 2011. He testified that he believed that she had then been paid out her share of the proceeds of sale of the concrete division and their deal was done at that point. [108] If Mr. Wright's evidence is accepted, and Ms. Fell performed no work for Farside after the sale of the concrete division, Farside paid Ms. Fell for nine months after the sale in December 2010 up until the date she was laid off in September 2011. At that time, she was receiving a salary of $6,800 a month. The proceeds of the sale were paid into Farside's bank account after the second pay period in December 2010. As a result, Ms. Fell received a total of $61,200 as repayment of her half share of the $300,000 net proceeds of sale. Although Mr. Wright testified that he also paid Ms. Fell's credit card bills, there was no evidence of that in the records. In any event, Ms. Fell's credit card bills would have to have amounted to almost $10,000 a month to make up the shortfall of $88,800. Farside's Company Value [109] Mr. Wright testified that after the sale of the concrete division, Farside owed more than it was worth. He said that if they had sold everything, there would still have been debt remaining. The evidence does not support his statement. Farside's financial year ends on September 30 of each year. [110] In Farside's financial statements for 2009, the last full year of operations before the sale of the concrete division, Farside had assets of $3.12 million. Its net earnings, allowing for tax, were $368,581, and, at the end of the year, its total retained earnings were $690,173. Its revenue was almost $4.4 million, and costs were just over $3.3 million. Gross margin was $1.08 million, and expenses were about $550,000. The company's long term debt included debt secured against miscellaneous equipment, including a 21 ft. Outlaw Caribou riverboat (the "riverboat") and a 2009 Hammerhead jet boat (the "jet boat"). As the sole shareholder, Mr. Wright's equity was just over $3.12 million. [111] In 2010, Farside had assets of just under $2.19 million. Its net earnings, after allowing for tax, were $28,778, and, at the end of the year, its total retained earnings were $648,953. The revenue was just over $4.85 million, and costs were just about $4.0 million. Wages had more than doubled. Gross margin was $872,346, and expenses were $940,865. Mr. Wright, as the sole shareholder, received a $70,000 dividend. The company's long term debt continued to include debt secured against miscellaneous equipment, but also against the riverboat and the jet boat. As the sole shareholder, Mr. Wright's equity was almost $2.2 million. The financial statements also show a $191,953 forgiveness of debt, which Mr. Wright was unable to explain. [112] In 2011, the year of the sale of the concrete division, Farside had $1.43 million in assets. It also had net earnings, after allowing for tax, of $337,726, and, at the end of the year, total retained earnings of $672,681. Its revenue was just over $2.5 million, and costs were just about $1.61 million. Gross margin was $919,447, and expenses were $524,410. Mr. Wright received a dividend of $314,000. The company's long term debt continued to include debt secured against miscellaneous equipment and the riverboat and jet boat. As the sole shareholder, Mr. Wright's equity was about $1.43 million. [113] In 2012, the first full year of operations without the concrete division, Farside had almost $1.22 million in assets. Although costs exceeded revenue in that year, there was still $494,677 in retained earnings. Mr. Wright's shareholder equity was about $1.22 million. The liabilities of the company included a $157,000 dividend payable and a further $76,772 payable to the shareholder. The company's long term debt continued to include the riverboat, but not the jet boat. Mr. Wright was not asked to explain what happened to the jet boat. [114] In cross-examination, Mr. Wright agreed that after the deal he alleged he had reached with Ms. Fell, Farside was still worth $1.2 million. When he was asked where Ms. Fell received property worth $1.2 million, Mr. Wright responded, "you would have to ask her." [115] He agreed that Farside's long term debt was about ten percent of the asset value and that Farside was not worthless, nor was it staggering under a debt load. [116] Mr. Wright was asked about the involvement of Farside's long time accountant, Gavin Still, in advising him and Ms. Fell about the division of their assets. Mr. Still is with Myers, Norris and Penney, who had been Farside's accountants for many years. Mr. Wright testified that Ms. Fell spoke to Mr. Still and then presented numbers to Mr. Wright, and that was how they moved forward. He was confronted that that evidence was not true, and he responded that that was how he understood it. Mr. Still was not called as a witness. Summary of Mr. Wright's Version of the Agreement [117] As I understand Mr. Wright's evidence, taken at its best, the terms of his oral agreement with Ms. Fell were that: (a) after separation, they would continue to deposit their paycheques into their joint account and, from that account, they would pay the mortgage and expenses for the family home; (b) commencing in October 2009, Ms. Fell would begin to receive the same salary as Mr. Wright--$6,800 monthly--but he would stop depositing his salary into the joint account, and she would assume responsibility for the mortgage and the household expenses; (c) Farside would sell the concrete division and they would equally divide the net proceeds of sale; (d) Ms. Fell's share of the net proceeds of sale from the concrete division would be paid out as salary over time and as payment of her personal credit cards until it was paid in full in September 2011; (e) Ms. Fell would keep the family home and assume responsibility for the mortgage and expenses with respect to it; (f) Mr. Wright would keep Farside; (g) Ms. Fell would be entitled to all other personal property located at the family home; and (h) Ms. Fell would not seek spousal support and Mr. Wright would not seek child support for Sarah. Assessment of the Credibility of the Evidence [118] As Justice Dillon explained in Bradshaw v. Stenner, 2010 BCSC 1398 at para. 186, aff'd 2012 BCCA 296, the credibility of a witness' evidence involves an assessment of its trustworthiness based upon the veracity or sincerity of the witness and the accuracy of the witness' evidence: [186] The art of assessment involves examination of various factors such as the ability and opportunity to observe events, the firmness of his memory, the ability to resist the influence of interest to modify his recollection, whether the witness' evidence harmonizes with independent evidence that has been accepted, whether the witness changes his testimony during direct and cross-examination, whether the witness' testimony seems unreasonable, impossible, or unlikely, whether a witness has a motive to lie, and the demeanour of a witness generally Ultimately, the validity of the evidence depends on whether the evidence is consistent with the probabilities affecting the case as a whole and shown to be in existence at the time [Citations omitted.] [119] At para. 187 of Bradshaw, Justice Dillon suggested a methodology for the assessment of credibility: [187] first consider the testimony of a witness on a 'stand alone' basis, followed by an analysis of whether the witness' story is inherently believable. Then, if the witness testimony has survived relatively intact, the testimony should be evaluated based upon the consistency with other witnesses and with documentary evidence. The testimony of non-party, disinterested witnesses may provide a reliable yardstick for comparison. Finally, the court should determine which version of events is the most consistent with the "preponderance of probabilities which a practical and informed person would readily recognize as reasonable in that place and in those conditions" [Citation omitted.] [120] In my assessment of the credibility of the parties' evidence, I have taken the approach suggested by Justice Dillon and, for the reasons which follow, I have concluded that Mr. Wright and Ms. Fell never reached an agreement about the division of their family property and maintenance. [121] Overall, I find Mr. Wright's evidence to be incredible in a number of respects, and where it differed from Ms. Fell's evidence, I prefer her evidence. A number of examples will suffice. [122] I do not accept Mr. Wright's evidence that he never suggested to Ms. Fell that their separation was temporary, so that he could figure some things out, and that they would get back together. The only inference to be drawn from their behaviour as a couple after their separation was that Ms. Fell was led to believe that they would be getting back together. [123] I also do not accept Mr. Wright's evidence about the purchase of the Ewonchuk home. It was not consistent with the "preponderance of probabilities" which a practical person would recognize as reasonable. There was no credible explanation for why, after carrying the cost of the Ewonchuk property for almost two years, Mr. Wright would gift $145,000 in profit from the sale to relative strangers who were convicted criminals. Mr. Wright presented as a shrewd business person who, together with Ms. Fell, built a company worth millions of dollars. He is unlikely to have, out of the goodness of his heart, assisted the Ewonchuks because of a plea for assistance from Dennis Ewonchuk's mother. On the evidence, Mr. Wright did not owe the Ewonchuks anything. I accept Ms. Fell's evidence that the transaction was intended to be an investment opportunity. [124] I do not accept Mr. Wright's evidence in cross-examination that Ms. Fell involved Mr. Still in setting the values of their family property. In direct, Mr. Wright said that during their negotiations, when discussing values of family assets, he would propose a value and Ms. Fell would either accept it or propose another. In cross-examination, he said that Ms. Fell spoke to Mr. Still, and that she presented numbers to Mr. Wright, and that was how they moved forward. [125] If Mr. Still was involved as suggested by Mr. Wright, I would have expected Mr. Wright to call him as a witness, and I draw an adverse inference that he did not do so. Further, Mr. Wright did not mention Mr. Still's involvement in his direct evidence. Instead, he testified that he and Ms. Fell did not discuss specific assets or assign values to them. [126] Mr. Wright's evidence about when he and Ms. Fell concluded their agreement differed from his discovery evidence to his trial evidence. At trial, he said that they negotiated their agreement over approximately two years. At discovery, he said that their agreement was concluded within a few weeks of May 4, 2010, the date on which Ms. Fell commenced these proceedings. This differing evidence is irreconcilable. [127] I also do not accept Mr. Wright's evidence that Ms. Fell agreed to assume responsibility for the mortgage and household expenses for the family home in exchange for an increase in her salary from $4,200 to $6,800 monthly. There is no dispute, on the evidence or in the records, that together they were earning $10,000 a month and, from that amount, paid their household expenses. If, as Mr. Wright alleges, Ms. Fell exchanged the family home for what remained of Farside after the sale of the concrete division, there is no reasonable explanation for why Ms. Fell would assume responsibility for the expenses for the family home, months before the concrete division was sold and before she received any money from its sale. [128] I accept that it is more likely that Ms. Fell was only content to receive less salary than Mr. Wright so long as they were a couple and working towards the same goals, and that she was unhappy about being paid less after the separation. Mr. Wright acknowledged the likelihood of Ms. Fell's explanation in cross-examination. [129] Apart from stating that Ms. Fell agreed to waive her claim to spousal support, Mr. Wright gave no evidence about their discussions in that regard. Spousal support was clearly an issue in the May 2010 family proceedings filed by Ms. Fell. It is not believable that she would waive her claim for spousal support in response to a notional claim, which has never been formally made by Mr. Wright, for child support. In any event, at the time Mr. Wright left the family home with Sarah, she was in her final years of high school, and she did not pursue post-secondary education. Any claim for child support would have been minimal compared to Ms. Fell's compensatory spousal support claim. [130] I do not accept Mr. Wright's evidence that Ms. Fell knew about, and agreed to, the sale of the concrete division. Since her affidavit of May 14, 2010, Ms. Fell has been resolute in her position that Mr. Wright was dealing with their family property without her knowledge and consent. If Mr. Wright had evidence to prove otherwise, I would have expected him to call or present it; he did not. In particular, if Ms. Fell was involved in cancelling the insurance on Farside's equipment or transferring title of the equipment to Interoute, I would have expected to see records of her involvement; none were presented. [131] I do not accept Mr. Wright's evidence that Ms. Fell was paid her share of the proceeds from the sale of the concrete division by receiving salary between the date of the sale and September 2011, and by having her credit card bills paid. There is just no credible evidence on which to conclude that Ms. Fell received a total of $150,000 in that manner. The portions of Farside's general ledger that were in evidence, and which covered December 12, 2010, to February 4, 2011, do not show payments of $10,000 per month to Ms. Fell for credit card debts. [132] I do not accept Mr. Wright's evidence that after the sale of the concrete division, Farside had no further work for Ms. Fell. Her evidence that, after the sale, she went to work at the Patry camp was inherently believable. In particular, her evidence that Mr. Wright stayed at the camp with her was credible. [133] I accept that Ms. Fell was kept in the dark about many of the transactions Mr. Wright negotiated after their separation. Her evidence that she confronted him about the trapline was inherently believable, as was her evidence about the riverboat being given to Mr. Dennehey. In both cases, Mr. Wright acknowledged that he had bought the trapline and had made a deal with Mr. Dennehey for the exchange of boats. He acknowledged that he may not have told her about the trapline. If, as Mr. Wright testified, Ms. Fell accepted the personal property located at the family home as part of their agreement, the riverboat was not Mr. Wright's to deal with. I do not accept Mr. Wright's evidence that Ms. Fell was involved with the deal. [134] Perhaps most importantly, after the sale of the concrete division, Farside was worth $1.2 million. It is not credible that Ms. Fell would have accepted the mortgaged family home, which, on the best evidence available, had equity of approximately $300,000, and some chattels located on the property, to which no value had been assigned, in satisfaction of her property claims including her claim to share in Farside which still had substantial value. [135] It is telling that, despite Mr. Wright's position that Ms. Fell agreed to a transfer of the family home to her as part of their settlement, either during the two years in which they negotiated as he said at trial, or in the few weeks after she filed her family proceedings, which he said in his discovery evidence, Mr. Wright only signed the transfer documents shortly in advance of this trial. [136] Finally, it was apparent during Mr. Wright's evidence that he was not able to articulate the terms of the agreement that he alleged the parties had reached. As in Berthin v. Berthin, 2016 BCCA 104, the purported agreement does not meet the "standard of certainty required for a valid and enforceable contract": at para. 50. [137] For all of these reasons, I conclude that the parties have not reached an agreement with respect to division of their family property, or with respect to Ms. Fell's claim for maintenance. Next Steps [138] In light of my conclusion that the parties did not reach an agreement with respect to property and/or maintenance, those issues remain to be determined. [139] I expect that there will be substantial costs in litigating historical values, obtaining historical business valuations, and assessing historical incomes based on self-employment income. I urge the parties to consider mediation and/or a judicial settlement conference before setting the remaining matters for trial. "MacNaughton J."