Best v. Best, (1999) 242 N.R. 1 (SCC)

JudgeLamer, C.J.C., L'Heureux-Dubé, Gonthier, Cory, McLachlin, Iacobucci, Major, Bastarache and Binnie, JJ.
CourtSupreme Court (Canada)
Case DateJuly 09, 1999
JurisdictionCanada (Federal)
Citations(1999), 242 N.R. 1 (SCC);49 RFL (4th) 1;242 NR 1;123 OAC 1;174 DLR (4th) 235;[1999] SCJ No 40 (QL);89 ACWS (3d) 540;[1999] 2 SCR 868;43 OR (3d) 740;1999 CanLII 700 (SCC);JE 99-1405

Best v. Best (1999), 242 N.R. 1 (SCC)

MLB Headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

....................

Temp. Cite: [1999] N.R. TBEd. JL.004

Theodore Clifford Best (appellant) v. Marlene Shirley Best (respondent)

(26345)

Indexed As: Best v. Best

Supreme Court of Canada

Lamer, C.J.C., L'Heureux-Dubé, Gonthier, Cory, McLachlin, Iacobucci, Major, Bastarache and Binnie, JJ.

July 9, 1999.

Summary:

The 52 year old spouses separated in 1988 after 12 years' marriage. It was the second marriage for both. Each had adult children from their previous marriages, but no children from the present marriage. The husband petitioned for divorce. The trial judge granted a divorce and ordered that the husband pay the wife $147,649.50 as an equalization payment, $2,500 monthly spousal support and $45,000 costs. The husband appealed. The wife cross-appealed, seeking certain alternate relief if the hus­band's appeal was successful.

The Ontario Court of Appeal, in a judg­ment reported 103 O.A.C. 344, dismissed the husband's appeal and the wife's cross-appeal. The husband appealed, submitting that (1) the pro rata method of valuing his defined benefit pension should have been used instead of the value-added method; (2) the trial judge and Court of Appeal erred in determining his likely retirement date; (3) the husband should have been permitted to settle his equalization obligation on an "if and when" basis; (4) spousal support should have been terminated upon his retirement; and (5) the Court of Appeal erred in up­hold­ing the costs award in favour of the wife.

The Supreme Court of Canada, L'Heureux-Dubé, J., dissenting in part, allowed the appeal in part. The pro rata method of valua­tion was the appropriate method for a defined benefit pension. The trial judge did not err in fixing the likely retirement date, in not ordering settlement of the equalization obligation on an "if and when" basis or in refusing to terminate spousal support. How­ever, the Court of Appeal erred in upholding the costs award. The court ordered that the parties bear their own costs in all courts.

Family Law - Topic 868.3

Husband and wife - Marital property - Distribution orders - Equalization pay­ments - [See Family Law - Topic 948.1 ].

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - Spouses separated after 12 years' marriage - At the date of separation, 20 years of the hus­band's 32 pensionable years predated the marriage - The value of the "defined bene­fit" pension apportioned to the mar­riage period was either $372,041 (value-added approach) or $151,480 (pro rata approach) - The pro rata method treated all years of pensionable service equally, while the value-added approach appor­tioned greater value to the later years of the pension - The Supreme Court of Canada stated that the Family Law Act's silence on which method to use meant that the method that most equitably valued the pension was to be used - The court held that the pro rata method best achieved the purposes of the Act for defined benefit pensions - The ultimate annualized benefit paid to an employee under a defined bene­fit plan was unrelated to the size of contri­butions or the rate of return on investment - The pro rata method accurately took account of the pension's nature as a future asset, instead of misleadingly treating it as a present asset with a lump-sum value that increased at the rate of inflation and return on risk free investments - See paragraphs 29 to 87.

Family Law - Topic 880.28

Husband and wife - Marital property - Distribution orders - Pensions - Spouses separated in 1988 after 12 years' marriage - At the date of separation, 20 years of the 52 year old husband's 32 pensionable years predated the marriage - At issue was the apportionment of the pension value earned during the marriage, which depended upon the expected retirement date at the time of separation - The trial judge fixed the re­tirement date at 57.4 years, notwith­standing that at the trial date the husband was 58 and still working - The Ontario Court of Appeal held that the trial judge did not err - The trial judge properly made his decision "without using the benefit of hindsight", stating that "facts which were unknown to, or not within the contem­plation of, the pension holder on valuation date are not relevant" - Based on all rele­vant information available as of the date of separation, a retirement age of 57.4 was reasonable notwithstanding, in hindsight, the husband did not in fact retire at that age - The Supreme Court of Canada stated that "I therefore agree with the Ontario Court of Appeal that, under a termination method, post-separation evidence should not be used in determining a likely retire­ment date unless the evidence reflects facts that were within the employee spouse's contemplation at the time of separation" - See paragraphs 95 to 105.

Family Law - Topic 948.1

Husband and wife - Marital property - Distribution orders - Practice - Delayed or instalment payments - The majority of a husband's equalization payment to his wife constituted her share of the present value of his pension - The trial judge ordered that the husband pay the equalization payments by instalments over a 10 year period - The husband wished to pay the wife's share of pension benefits "if and when" he received them - The Supreme Court of Canada held that the trial judge's decision on the method of payment was highly contextual and fact-based and de­served deference - The court discussed factors militating against the use of an "if and when" payment scheme and stated that "in light of the difficulties that seem to attend the crafting and administration of a fair 'if and when' order in Ontario, I do not believe that [the trial judge] exceeded his discretion in choosing an instalment scheme for settlement of the [husband's] equalization payment" - See paragraphs 106 to 117.

Family Law - Topic 4022.1

Divorce - Corollary relief - Maintenance awards - To wife - Extent of obligation - The 52 year old spouses separated in 1988 after 12 years' marriage (second marriage for both of them) and divorced one year later - There were no children from the marriage - The husband was a school principal - The wife obtained a university degree during the marriage and training as a real estate salesperson, but health problems left her with no means of support - The trial judge awarded $2,500 per month spousal support, with no time limit - The husband did not challenge the amount, but claimed that the trial judge should have ordered that support terminate when he retired - The Ontario Court of Appeal held that the trial judge did not err in making support not limited in time - The court noted that the husband was entitled to apply to vary support on the basis of changed circumstances - The Supreme Court of Canada affirmed that given that the husband's support obligation was predicated on his principal's salary and he was now retired, the appropriate pro­cedure was for the husband to apply to vary support on the basis of changed cir­cumstances - See paragraphs 118 to 122.

Family Law - Topic 4176

Divorce - Practice - Costs - Party and party costs - Spouses divorced - The criti­cal issues were valuation of the hus­band's pension and entitlement to marital support - The trial judge accepted the valuation method proposed by the wife and awarded spousal support - The wife was awarded $45,000 in costs - The Ontario Court of Appeal affirmed the judgment, including the costs award - The Supreme Court of Canada affirmed the judgment respecting spousal support, but chose the valuation method proposed by the husband, thereby reducing the wife's share of the husband's pension - Respecting costs, the court stated that "in light of the fact that the dispute was legitimate and complex, I do not believe either party should recover costs from the other. The parties will therefore bear their own costs in all courts." - See paragraph 123.

Cases Noticed:

Kennedy v. Kennedy (1996), 89 O.A.C. 257; 19 R.F.L.(4th) 454 (C.A.), refd to. [para. 24].

Bascello v. Bascello (1995), 26 O.R.(3d) 342 (Gen. Div.), refd to. [para. 42].

Christian v. Christian (1991), 7 O.R.(3d) 441 (Gen. Div.), refd to. [para. 58].

Chinneck v. Chinneck, [1995] O.J. No. 2786 (Gen. Div.), refd to. [para. 58].

Perrier v. Perrier (1987), 12 R.F.L.(3d) 266 (Ont. H.C.), refd to. [para. 58].

Rawluk v. Rawluk (1986), 55 O.R.(2d) 704 (H.C.), refd to. [para. 62].

Rawluk v. Rawluk, [1990] 1 S.C.R. 70; 103 N.R. 321; 38 O.A.C. 81, refd to. [para. 62].

Clarke v. Clarke, [1990] 2 S.C.R. 795; 113 N.R. 321; 101 N.S.R.(2d) 1; 275 A.P.R. 1, refd to. [para. 62].

Valenti v. Valenti (1996), 21 R.F.L.(4th) 246 (Ont. Gen. Div.), refd to. [para. 63].

Deane v. Deane (1995), 14 R.F.L.(4th) 55 (Ont. Gen. Div.), refd to. [para. 63].

Miller v. Miller (1987), 8 R.F.L.(3d) 113 (Ont. Dist. Ct.), refd to. [para. 63].

Shafer v. Shafer (1996), 25 R.F.L.(4th) 410 (Ont. Gen. Div.), refd to. [para. 64].

Beaudoin v. Beaudoin, [1997] O.T.C. Uned. 776 (Gen. Div.), refd to. [para. 64].

Patrick v. Patrick, [1997] O.T.C. Uned. 644; 34 R.F.L.(4th) 228 (Gen. Div.), refd to. [para. 64].

Spinney v. Spinney, [1996] O.J. No. 1869 (Gen. Div.), refd to. [para. 64].

Munro v. Munro, [1995] O.J. No. 1769 (Gen. Div.), refd to. [para. 64].

Rusticus v. Rusticus, [1995] O.J. No. 516 (Gen. Div.), refd to. [para. 64].

Ramsay v. Ramsay (1994), 119 Sask.R. 81; 1 R.F.L.(4th) 447 (Q.B.), refd to. [para. 81].

Humble v. Humble (1991), 805 S.W.2d 558 (Tex. Ct. App.), refd to. [para. 86].

Hierlihy v. Hierlihy (1984), 48 Nfld. & P.E.I.R. 142; 142 A.P.R. 142 (Nfld. C.A.), refd to. [para. 89].

Knippshild v. Knippshild (1995), 129 Sask.R. 92; 11 R.F.L.(4th) 36 (Q.B.), refd to. [para. 91].

Rutherford v. Rutherford (1979), 14 R.F.L.(2d) 41 (B.C.S.C.), refd to. [para. 92].

Gilmour v. Gilmour, [1995] 3 W.W.R. 137; 128 Sask.R. 113; 85 W.A.C. 113 (C.A.), refd to. [para. 92].

Bourdeau v. Bourdeau, [1993] O.J. No. 1751 (Gen. Div.), refd to. [para. 92].

Rauf v. Rauf (1992), 39 R.F.L.(3d) 63 (Ont. Gen. Div.), refd to. [para. 92].

Porter v. Porter (1986), 1 R.F.L.(3d) 12 (Ont. Dist. Ct.), refd to. [para. 92].

Moravcik v. Moravcik (1983), 50 A.R. 180; 37 R.F.L.(2d) 102 (C.A.), refd to. [para. 92].

George v. George (1983), 23 Man.R.(2d) 89; 35 R.F.L.(2d) 225 (C.A.), refd to. [para. 92].

Marsham v. Marsham (1987), 59 O.R.(2d) 609 (H.C.), refd to. [para. 93].

Weaver v. Weaver (1991), 32 R.F.L.(3d) 447 (Ont. Gen. Div.), refd to. [para. 96].

Leeson v. Leeson (1990), 26 R.F.L.(3d) 52 (Ont. Dist. Ct.), refd to. [para. 96].

Forster v. Forster (1987), 11 R.F.L.(3d) 121 (Ont. S.C.), refd to. [para. 96].

Huisman v. Huisman (1996), 91 O.A.C. 293; 21 R.F.L.(4th) 341 (C.A.), refd to. [para. 96].

Stevens v. Stevens (1992), 41 R.F.L.(3d) 212 (Ont. U.F.C.), refd to. [para. 98].

Alger v. Alger (1989), 21 R.F.L.(3d) 211 (Ont. S.C.), refd to. [para. 98].

Deroo v. Deroo (1990), 28 R.F.L.(3d) 86 (Ont. S.C.), refd to. [para. 98].

Hilderley v. Hilderley (1989), 21 R.F.L.(3d) 383 (Ont. H.C.), refd to. [para. 98].

Radcliff v. Radcliff, [1994] O.J. No. 2874 (Gen. Div.), refd to. [para. 98].

Salib v. Cross (1993), 15 O.R.(3d) 521 (Gen. Div.), refd to. [para. 99].

Rickett v. Rickett (1990), 72 O.R.(2d) 321 (H.C.), refd to. [para. 99].

Best v. Best (1992), 57 O.A.C. 108; 41 R.F.L.(3d) 383 (C.A.), refd to. [para. 111].

Shadbolt v. Shadbolt (1997), 45 O.T.C. 124; 32 R.F.L.(4th) 253 (Gen. Div.), refd to. [para. 119].

Butt v. Butt (1989), 22 R.F.L.(3d) 415 (Ont. H.C.), refd to. [para. 119].

Veres v. Veres (1987), 9 R.F.L.(3d) 447 (Ont. S.C.), refd to. [para. 119].

Nantais v. Nantais (1995), 26 O.R.(3d) 453 (Gen. Div.), refd to. [para. 119].

Rivers v. Rivers (1993), 47 R.F.L.(3d) 90 (Ont. Gen. Div.), refd to. [para. 119].

Flett v. Flett (1992), 43 R.F.L.(3d) 24 (Ont. U.F.C.), refd to. [para. 119].

R. v. Gladue (J.T.), [1999] 1 S.C.R. 688; 238 N.R. 1; 121 B.C.A.C. 161; 198 W.A.C. 161, refd to. [para. 139].

Rizzo & Rizzo Shoes Ltd. (Bankrupt), Re, [1998] 1 S.C.R. 27; 221 N.R. 241; 106 O.A.C. 1, refd to. [para. 139].

Law v. Minister of Employment and Im­migration, [1999] 1 S.C.R. 497; 236 N.R. 1, refd to. [para. 164].

Statutes Noticed:

Family Law Act, R.S.O. 1990, c. F-3, preamble [paras. 12, 136]; sect. 4(1) [para. 12]; sect. 4(4) [paras. 12, 137]; sect. 5(1) [para. 12]; sect. 5(6)(h) [paras. 12, 150]; sect. 9(1)(a), sect. 9(1)(c), sect. 9(1)(d)(i), sect. 9(3) [para. 12].

Authors and Works Noticed:

Burrows, G.E., Pension Considerations on Marriage Breakdown Retirement Age (1995-96), 13 C.F.L.Q. 25, pp. 43 [para. 96]; 52 [para. 157].

Burrows, G.E., Value Added or Pro Rata?, in Money & Family Law, vol. 10, p. 50 [para. 137].

Canadian Institute of Actuaries, Standard of Practice for the Computation of the Capitalized Value of Pension Entitle­ments on Marriage Breakdown for Pur­poses of Lump-Sum Equalization Pay­ments (1993), pp. 5 [paras. 43, 80]; 6 [para. 45]; 10, 11 [para. 41].

Canadian Institute of Actuaries Task Force on the Division of Pension Benefits upon Marriage Breakdown, Draft Paper (1998), The Division of Pension Benefits upon Marriage Breakdown, p. 9 [para. 92].

Corpus Juris Secundum (1986), vol. 27C, para. 558, pp. 53, 54 [para. 86]; 57 [para. 89].

Côté, Pierre-André, The Interpretation of Legislation in Canada (2nd Ed. 1992), p. 219 [para. 139].

Driedger, Elmer A., Construction of Stat­utes (2nd Ed. 1983), p. 87 [para. 139].

Driedger, Elmer A., Construction of Stat­utes (3rd Ed. 1994), p. 131 [para. 139].

McLeod, James G., Annotation to Alger v. Alger (1989), 21 R.F.L.(3d) 212, gen­erally [para. 96].

McLeod, James G., Case Comment on Monger v. Monger (1994), 8 R.F.L.(4th) 182, pp. 188 to 189 [para. 114].

McLeod, James G., Annotation to Weaver v. Weaver (1991), 32 R.F.L.(3d) 448, generally [para. 98].

Ontario, Law Reform Commission, Report on Family Law Part IV: Family Property Law (1974), p. 101 [para. 145].

Ontario, Law Reform Commission, Report on Pensions as Family Property: Valua­tion and Division (1995), pp. 1 [para. 54]; 12, 13 [para. 32]; 37 [para. 113]; 46 [para. 111]; 84 [para. 54]; 87 [paras. 54, 143]; 91 [para. 34]; 104 to 106 [para. 90]; 123 [para. 80]; 147 [para. 54]; 148 [para. 57].

Patterson, J.B., Confusion Created in Pen­sion Valuation for Family Breakdown Case Law by the Use of Expressions "Termination Method" and "Retirement Method" (1998), 16 C.F.L.Q. 249, pp. 249 to 256 [para. 42].

Patterson, J.B., Pension Division and Val­u­ation: Family Lawyers' Guide (2nd Ed. 1995), pp. 163 [para. 73]; 187, 188 [para. 42]; 309 [para. 98].

Walker, T.J., Double Dipping - Can a Pension Be Both Property and Income? (1994), 10 C.F.L.Q. 315, p. 323 [para. 119].

Counsel:

William J. Sammon and Jirina Bulger, for the appellant;

Frank C. Tierney and Shawn L.C. Peers, for the respondent.

Solicitors of Record:

Barnes, Sammon, Ottawa, Ontario, for the appellant;

Tierney, Stauffer, Ottawa, Ontario, for the respondent.

This appeal was heard on February 17, 1999, before Lamer, C.J.C., L'Heureux-Dubé, Gonthier, Cory, McLachlin, Iacobucci, Major, Bastarache and Binnie, JJ., of the Supreme Court of Canada.

On July 9, 1999, the judgment of the Supreme Court of Canada was delivered in both official languages and the following opinions were filed:

Major, J. (Lamer, C.J.C., Gonthier, Cory, McLachlin, Iacobucci, Bastarache and Binnie, JJ., concurring) - see para­graphs 1 to 128;

L'Heureux-Dubé, J., dissenting in part - see paragraphs 129 to 166.

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