R.M.S. v. N.S.

IN THE SUPREME COURT OF BRITISH COLUMBIA IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: R.M.S. v. N.S., 2004 BCSC 615 Date: 20040507 Docket: E016579 Registry: New Westminster Between: R.M.S. Plaintiff And N.S. Defendant Before: The Honourable Mr. Justice Williams (In Chambers) Reasons for Judgment Counsel for the plaintiff: N. Hunter Counsel for the defendant: R.E. Rhodes Date and Place of Hearing: April 28, 2004 New Westminster, B.C. [1] This is a proceeding under Rule 18A. [2] Most of the issues between the parties have been resolved. Each of them seeks a divorce, and there is no contention as to that application. [For clarity of reference, I will refer to the defendant as the "wife" and the plaintiff as the "husband".] [3] In addition, the wife seeks certain orders of the court, namely, the following: 1. that the husband pay her the sum of $292 each and every month, commencing January 1, 2004, and continuing until June 5, 2005 for support of the children; 2. that the parties provide each other with proof of income for the previous year by May 15 of each year, in order to determine the quantum of child support for the following year; 3. an order that each year the husband remains self-employed, the sum of $15,000 imputed income be added to his income tax income figure to adjust his gross income for cash income earned and to account for personal benefits paid by his company; 4. an order that child support will be payable for so long as the children remain "children of the marriage" as defined in the Divorce Act, and 5. costs. [4] The husband opposes the granting of this relief. [5] The pleadings also seek the following orders: 1. that the parties will share custody and guardianship of the children; 2. that the children shall reside one week with the plaintiff (husband) and one week with the defendant (wife) on an alternating basis, or by any other arrangement that is consented to by the parties; and 3. the parties will share section 7 Special and Extraordinary Expenses for the children in proportion to their incomes. The husband does not oppose the granting of this relief and I infer joins in seeking that these orders be made. Background [6] The couple married in June, 1991. There are two children of the marriage, C.M.S., age 10, and C.R.A.S., who is 8 years of age. [7] The parties separated in April, 2002, and a separation agreement was reached and executed by them, dated September 5, 2002. A copy of that document is in evidence. It provided for joint custody and guardianship of the children. The arrangement is that the children will reside with each of the parties on a "week about" schedule. [8] Both of the parties reside in the south Surrey area; the children's roots, schools, friends and activities are centered there and that is a important factor for the shared custody arrangement to work. [9] The husband is 35 years of age, and is a plumber by trade. He has his own company. The material indicates that he actually provides his services exclusively to another company and his income is thereby for the most part, limited by that arrangement and he is therefore unable to substantially increase his income by performing other jobs for cash. I note as well that he has an ongoing physical limitation as a result of surgery following a workplace accident. That, he says, affects his earning ability. [10] The husband is now in another relationship; he lives with a woman whom he intends to marry. They have an infant child, born in [ ], 2004. As well, his common law spouse has a son, four years of age, to whose support he contributes. As noted, the husband is responsible for the support of his own two children fifty per cent of the time. Finally, the husband indicates in the affidavit material filed that he pays all extra curricular expenses for his two children; this is disputed by the wife. [11] The husband and his common law spouse reside in rented accommodation in the south Surrey area. The common law spouse is not working outside the home at this time. [12] The wife is 33 years of age. She is apparently trained and experienced as a secretary and worked as a legal secretary for a period of time. She is now employed as an administrative secretary. Her income from that job in 2002 was $28,000. She deposes that she was in a serious motor vehicle accident in 2003 and sustained injuries to her hand, back and neck. As a result, she cannot work more than six hours per day. Her employer accommodates that limitation, but she says that her circumstances prevent her from finding better employment or advancing within her present company. [13] The wife is presently residing with her mother at the mother's residence in south Surrey; no other details of that arrangement were provided. [14] In her affidavit material, the wife states that she is paying her proportionate share of the extracurricular expenses for the children. [15] The separation agreement provided for a general resolution of the issues between the parties, joint custody and guardianship of the children and what was described as an "equitable" division of assets. [16] I note that the separation agreement contains the following recitation: 14. The Wife agrees that she is prepared to support and maintain herself and agrees that henceforth she will make no claim against the Husband or take any proceedings against the Husband for payment of spousal maintenance or alimony pursuant to the Family Relations Act of British Columbia or the Divorce Act of Canada, or any other enabling legislation whatsoever or the common law. [17] There is a corresponding provision in the separation agreement whereby the husband makes an identical assertion. [18] With respect to the issue of child maintenance, after setting out in detail the arrangements for the shared parenting, the following provision appears at ¶7: In view of the shared custody arrangement neither party will pay child maintenance to the other. [19] There is also a "certificate of independent legal advice" which forms part of the agreement. The certificate, as it relates to the wife, is as follows: I fully explained the nature of the Agreement dated the 5th day of September, 2002, and the effect to N.S. of signing it in the form attached. She stated to me and I am satisfied that she fully understands the nature and effect to her of the document and that she executed it freely and voluntarily and not under any undue influence exercised by R.M.S., her spouse. Dated at Surrey, British Columbia this 5th day of September, 2002. "N Hunter"______ Name of Solicitor: I, N.S., acknowledge that all of the statements in the above Certificate of Independent Legal Advice are correct. "N.S."______ N.S. [20] Again, there is a similar certification made by the husband and his solicitor. [21] In the wife's affidavit sworn February 25, 2004, she deposes as follows: I did enter into a Separation Agreement with the Plaintiff, but at the time the Plaintiff was putting pressure on me, and against the advice of counsel signed the Agreement as it was prepared by the Plaintiff's counsel. Since that time, I have found I cannot afford accommodation suitable for the children and I within the south Surrey/White Rock area. [22] The separation agreement provides that the parties will share the section 7 expenses of the children on an income proportionate basis. Position of the Applicant Wife: [23] Essentially, the wife takes the position that the present arrangement seems unfair to her: (a) She says that during the marriage, she knew her husband to take some cash work, so that his actual income was greater than his reported income. It is her contention that the income he has agreed to for the purpose of these proceedings, $41,000 per annum, is artificially under-stated, or alternatively, the Court should conclude that the husband is deliberately under-employed. Specifically, in her argument, she says "the plaintiff made cash income throughout the marriage of the plaintiff and the defendant, and there is no reason to believe that he no longer earns this type of under-the-table income. His income should be calculated to be at least $15,000 more than the amount indicated in his Form 89 financial statement for these reasons". (b) The wife also says that the husband's company pays certain of his personal expenses, and that should be a consideration. (c) The wife says that the husband is enjoying a lifestyle that is far more comfortable than hers, and that he is able to afford the responsibilities of his new family arrangement, that he has a "rented" home, a big screen television set and a new truck. [24] The wife says that the Court should impute an income (for Guidelines purposes) of $51,232 and then order child support based on the difference between what her income would require her to pay and the Guidelines support for his imputed income. The result would be that the husband would pay $292 per month. [25] The wife also says that the Court should look favourably upon her application on the ground that she "signed the [separation] agreement against the advise [sic] of counsel, but with an understanding of the law wherein the best interests of the children are always paramount over any agreement". [26] In response to the suggestion that reluctance should be shown in permitting her to disavow the obligations of the separation agreement, she founds her application on the proposition that the best interests of the children is the dominant consideration. Position of the Husband: [27] The husband says that his actual income is $36,000 per annum, but accepts that he receives certain benefits because of expenses that his company pays. In the result, he takes the position that the appropriate income which should be recognized for Guidelines purposes is $41,000 per year. That was the income figure upon which the separation agreement was premised. [28] The husband observes that the wife receives the Child Tax Credit and a GST rebate, which provide her with an additional non-taxable income of $3,441.12; he does not seek to share in that. [29] Finally, the husband says that he has ordered his affairs in reliance on the arrangements set out in the agreement. He says that his circumstances have changed and become more onerous because of the recent birth of his child and the fact that his common law spouse is not employed outside the home. [30] In all the circumstances, he says that there is no proper basis upon which to make the orders sought. Discussion: [31] There are three general principles applicable to the issue before the Court: i An application to vary an existing child support order will ordinarily require that there be demonstrated a change of circumstances (Divorce Act, s. 17; Child Support Guidelines, s. 14; Family Relations Act, s. 96). ii The courts should show a reasonable degree of deference to the contractual arrangements made by parties in the course of a fair negotiation (Miglin v. Miglin, [2003] 1 S.C.R. 303; Hartshorne v. Hartshorne, [2004] S.C.J. No. 20). iii The Court has an overriding obligation to ensure that the best interests of children are served. [32] At the outset, it must be made clear that a court will be extremely hard-pressed to find a basis to make orders such as are sought here by reliance on submissions that, because the respondent is a plumber, or because he has a large screen television (admittedly being purchased on an instalment plan), a greater income should be imputed to him. Similarly, the wife's statement that, because the husband used to work for cash, it should be accepted that he continues to do so, in the absence of any supporting evidence, is untenable. [33] There is no evidentiary basis upon which it would be proper to impute an income greater than $41,000 per annum to the husband. It may possibly be that he earns more, but a finding would have to be based on something other than an assertion of what is essentially a suspicion. [34] With respect to the separation agreement, it is prima facie a fair resolution of the issues, including the division of assets and claims for maintenance. It appears the wife entered the agreement with an appropriate understanding of all of the relevant circumstances and with the benefit of legal advice. No case has been made which would cause me to conclude that she made the agreement without an understanding of her rights, the relative financial positions of the parties or the binding effect of the contract. In all these circumstances, the wife must be taken to have understood and agreed to the terms, and it is reasonable to conclude that the separation agreement represents a fair and reasoned resolution of the issues between the parties. [35] Each party was reasonably entitled to consider that the resolution of issues attained by the separation agreement could be relied upon and each of them had a right to make decisions and order their affairs accordingly. A court must be cautious to substantially change those arrangements in the absence of a proper reason to do so. In the present case, I do not consider that justification has been shown. [36] Finally, as indicated above, there is no doubt that the Court has jurisdiction to order variation where it is required to ensure that the best interests of the children are properly served. I cannot find on the evidence here a basis to conclude that variation should be ordered to satisfy this purpose. Conclusion: [37] There is no evidence before the Court that would demonstrate that circumstances have changed appreciably from those that were known to the parties when they executed the separation agreement 20 months ago. As well, it is my view that a reasonable deference to the terms of the separation agreement is warranted. Finally, with respect to a concern for the best interests of the children, I cannot find in the evidence a basis upon which to conclude that an order for variation is justified. [38] In all the circumstances, the application for variation is dismissed. [39] On the evidence, it would appear that both parties are making appropriate contributions to the section 7 expenses of the children. [40] The following orders are made: i R.M.S. and N.S. who were married on June 8, 1991 are divorced from each other, the divorce to take effect on the thirty first day after the date of these reasons for judgment; ii R.M.S. and N.S. will share custody and guardianship of the children, C.M.S., born [ ], 1993, and C.R.A.S., born [ ], 1996; iii the children shall reside one week with the plaintiff R.M.S. and one week with the defendant N.S. on an alternating basis, or by any other arrangement that is consented to by the parties; iv the parties shall provide each other with proof of income for the previous year by May 15 of each year, in order to determine the quantum of child support, if any, to be paid the following year; and v the parties will share section 7 Special and Extraordinary Expenses for the children in proportion to their incomes. [41] The parties will bear their own costs. "J.W. Williams, J." The Honourable Mr. Justice J.W. Williams