Goett v. Goett,

• Judge: Horner,Martin,Paperny
• Neutral Citation: 2013 ABCA 216
• Date: 10 June 2013
• Subject Matter: FAMILY LAW
• Court: Court of Appeal (Alberta)

Goett v. Goett (2013), 553 A.R. 275; 583 W.A.C. 275 (CA)

MLB headnote and full text

Temp. Cite: [2013] A.R. TBEd. JN.067

Karen Joanne Goett (appellant/plaintiff) v. Warren Henry Goett (respondent/defendant)

(1301-0020-AC; 2013 ABCA 216)

Indexed As: Goett v. Goett

Alberta Court of Appeal

Paperny and Martin, JJ.A., and Horner, J.(ad hoc)

June 14, 2013.

Summary:

The appellant mother appealed an order declining to impute income to the respondent, her former husband, in accordance with s. 18 of the Federal Child Support Guidelines and failing to extend garnishment of support arrears to the respondent's new wife's corporation, Push N Pilot Inc. The respondent claimed his 2011 income from Push N Pilot Inc. was $57,000. The chambers judge had imputed income pursuant to s. 19 of the Guidelines, in the amount of $80,000.

The Alberta Court of Appeal allowed the appeal. The chambers judge erred in declining to consider s. 18, and in failing to extend the enforcement order to Push N Pilot Inc. The respondent's imputed income was $150,000, effective from the date the appellant brought her application to increase child support.

Family Law - Topic 2421

Maintenance of wives and children - Appeals - General - [See Family Law - Topic 4019 ].

Family Law - Topic 2536.2

Maintenance of wives and children - Enforcement - Orders - Liability of payor's corporation - At the time of the corollary relief order, the respondent payor had transferred his entire interest in his business to a corporation owned by his then girlfriend (now wife) - Immediately after the granting of the divorce, the business was transferred into a new company, Push N Pilot Inc., with the new wife as sole shareholder and director - The evidence established that the corporation was controlled by the respondent - The chambers judge declined to extend an enforcement order to the successor corporation and to order financial disclosure and garnishment of support arrears against Push N Pilot Inc. - The Alberta Court of Appeal varied the order for enforcement, including disclosure and garnishment, to the extent that it extended to Push N Pilot Inc. and any future successor corporations - See paragraph 26.

Family Law - Topic 4019

Divorce - Corollary relief - Maintenance and awards - Awards - Appeals (incl. jurisdiction) - The appellant submitted that the chambers judge erred in failing to use s. 18 of the Federal Child Support Guidelines to impute income to the respondent, her former husband - The Alberta Court of Appeal stated that "[a]n appellate court will only interfere with a child support order if there has been an error in principle, a misapprehension of the evidence, or the award is clearly wrong. The refusal to exercise a discretion to impute income is subject to the same standard" - See paragraph 9.

Family Law - Topic 4045.1

Divorce - Corollary relief - Maintenance - Child support guidelines (incl. nondivorce cases) - General (incl. interpretation) - The Alberta Court of Appeal stated that "[a]ny interpretation of the child support guidelines demands a purposive approach, including establishing a fair standard of support for children that ensures that they continue to benefit from the financial means of both parents after separation (see 3(a) of the guidelines)." - See paragraph 10.

Family Law - Topic 4045.5

Divorce - Corollary relief - Maintenance - Child support guidelines (incl. nondivorce cases) - Calculation or attribution of income - The Alberta Court of Appeal stated that "where a payor operates through a corporation, the [federal child support] guidelines expressly provide that the corporate veil can be pierced if the court is satisfied that the income as determined under s. 16 does not fairly represent the amount available to pay child support ... When the corporate veil is lifted in a commercial context, certain factors are considered ... These factors are also relevant, although not applied as stringently, in the family context" - See paragraphs 12 and 13.

Family Law - Topic 4045.5

Divorce - Corollary relief - Maintenance - Child support guidelines (incl. nondivorce cases) - Calculation or attribution of income - This appeal raised the interplay between s. 18 and s. 19 of the Federal Child Support Guidelines - Specifically, the Alberta Court of Appeal determined whether s. 18 could be used to impute income under s. 19 in circumstances where the payor was not a shareholder, director or officer, but was the controlling mind and de facto owner of the corporation - "While the wording of s. 18 does not specifically address the situation here, the jurisprudence clearly allows for the piercing of the corporate veil in these circumstances. Section 19 of the guidelines affords the court a discretion to impute income in circumstances where the court is of the view that the income as stated in the tax returns does not truly represent the income available to pay child support. Section 18 is one method that assists the court in determining what is appropriate income for the purpose of child support. The sections are inextricably linked, designed to work in tandem, and are not mutually exclusive means of ascertaining that income." - See paragraph 18.

Family Law - Topic 4045.5

Divorce - Corollary relief - Maintenance - Child support guidelines (incl. nondivorce cases) - Calculation or attribution of income - The appellant appealed an order declining to impute income to her former husband in accordance with s. 18 of the Federal Child Support Guidelines and refusing an order for financial disclosure and garnishment of support arrears against the respondent's new wife's corporation, Push N Pilot Inc. - The chambers judge had declined to consider what amount of pre-tax income from the corporation ought to be available for the payment of child support under s. 18 - The Alberta Court of Appeal held that the judge erred in declining to consider s. 18, in incorrectly reversing the onus onto the appellant to establish that the corporate expenses were unreasonable, and in failing to extend an enforcement order to Push N Pilot Inc. - The evidence established that the corporation was controlled by the respondent - The financial statements reported a healthy income stream - In calculating income for the purpose of child support, the court noted the following expenses: the payment of wages to the respondent and his new wife; the corporation's pre-tax income; and personal use business expenses - See paragraphs 23 to 25.

Family Law - Topic 4046

Divorce - Corollary relief - Maintenance - Enforcement - General - [See Family Law - Topic 2536.2 ].

Cases Noticed:

Hickey v. Hickey, [1999] 2 S.C.R. 518; 240 N.R. 312; 138 Man.R.(2d) 40; 202 W.A.C. 40, refd to. [para. 9].

Nesbitt v. Nesbitt (2001), 156 Man.R.(2d) 238; 246 W.A.C. 238; 2001 MBCA 113, refd to. [para. 11].

Kowalewich v. Kowalewich (2001), 155 B.C.A.C. 143; 254 W.A.C. 143; 2001 BCCA 450, refd to. [para. 11].

Wildman v. Wildman (2006), 215 O.A.C. 239; 82 O.R.(3d) 401 (C.A.), refd to. [para. 12].

Arsenault v. Arsenault (1998), 59 O.T.C. 232 (Gen. Div.), refd to. [para. 12].

Baum v. Baum (1999), 182 D.L.R.(4th) 715 (B.C.S.C.), refd to. [para. 15].

Statutes Noticed:

Divorce Act Regulations (Can.), Federal Child Support Guidelines, SOR/97-175, sect. 18, sect. 19 [para. 1].

Federal Child Support Guidelines - see Divorce Act Regulations (Can.).

Counsel:

R.G. Harvie, Q.C., for the appellant;

S.A. Harling, for the respondent.

This appeal was heard on June 10, 2013, before Paperny and Martin, JJ.A., and Horner, J.(ad hoc), of the Alberta Court of Appeal. The Court delivered the following memorandum of judgment, filed at Calgary, Alberta, on June 14, 2013.