Vilcu v. Grams, (1999) 172 Sask.R. 201 (CA)

• Judge: Bayda, C.J.S., Wakeling and Jackson, JJ.A.
• Court: Court of Appeal (Saskatchewan)
• Case Date: January 19, 1999
• Jurisdiction: Saskatchewan
• Citations: (1999), 172 Sask.R. 201 (CA);1999 CanLII 12231 (SK CA);43 RFL (4th) 385;[1999] SJ No 14 (QL);172 Sask R 201

Vilcu v. Grams (1999), 172 Sask.R. 201 (CA);

   185 W.A.C. 201

MLB headnote and full text

Temp. Cite: [1999] Sask.R. TBEd. FE.037

Wayne John Vilcu (petitioner/respondent by counter-petition/appellant) v. Laurel Donelda Vilcu (respondent/petitioner by counter-petition/respondent)

(Nos. 2773, 2182)

Indexed As: Vilcu v. Grams

Saskatchewan Court of Appeal

Bayda, C.J.S., Wakeling and Jackson, JJ.A.

January 19, 1999.

Summary:

Spouses divorced after 12 years of mar­riage. The wife received $750 interim monthly spousal support. At issue was the divi­sion of matrimonial property and spousal support.

The Saskatchewan Court of Queen Bench, Family Law Division, in a decision reported 154 Sask.R. 201, held that the wife was entitled to a $71,333 equalization payment. Certain premarital assets were exempted under s. 23 of the Matrimonial Property Act. The wife was awarded $750 monthly spousal support until September 1998. The husband appealed.

The Saskatchewan Court of Appeal allowed the appeal in part with respect to the exemptions for premarital assets. The appeal was dismissed for the rest.

Family Law - Topic 880.1

Husband and wife - Marital property - Distribution orders - Exempt acquisitions - Including pre-marriage acquisitions - Spouses divorced - At issue was the divi­sion of marital property - The husband claimed that a quarter-section of farmland, acquired before the marriage, was exempted under s. 23(1) of the Matrimo­nial Property Act - The marital home was not built on that land since the husband had chosen to build on his father's land rather than on his own, contrary to the wife's preference - The trial judge refused to exclude the property under s. 23(4), where it would be unfair to the wife - Equitable considerations dictated that the land value be distributed as though it were part of the matrimonial home - The Saskatchewan Court of Appeal agreed - See paragraphs 9 to 12.

Family Law - Topic 880.12

Husband and wife - Marital property - Distribution orders - Exempt acquisitions - Post-marital exchange of pre-marital exempt assets - The husband claimed an exemption for deferred grain tickets acquired before marriage because he trans­ferred a portion of his grain profits into deferred grain tickets every year so as to give rise to the conclusion that each ticket was an "exchange" for the tickets he owned before the marriage - The hus­band's claim was dismissed - The Saskatchewan Court of Appeal held that the grain tickets had not been used to acquire a traceable asset but to fund "many, now unidentifiable, purposes" - The inescapable conclusion was that the grain tickets were consumed in the mar­riage - Any new grain ticket resulted from the marriage and not from an exchange for a previous ticket - See paragraphs 17 to 33.

Family Law - Topic 880.12

Husband and wife - Marital property - Distribution orders - Exempt acquisitions - Post-marital exchange of pre-marital exempt assets - At marriage, the husband held RSP's worth $30,879.10 - Upon the date of application for divorce and division of matrimonial property, the husband's RSP's were worth $11,818.38 - The hus­band also held mutual funds worth $78,281.98 - The trial judge granted the husband a $11,818.38 exemption for his RSP's - The husband appealed - He argued that the trial judge had failed to give effect to the evidence of his income tax returns which demonstrated that no RSP's had ever been cashed - Therefore, he sub­mit­ted, the RSP's must still be in existence, either in the form of RSP's or mutual funds - The Saskatchewan Court of Appeal allowed the appeal and granted a $30,879.10 exemption - See paragraphs 34 to 40.

Family Law - Topic 880.36

Husband and wife - Marital property - Distribution orders - Particular property - Active business - During their marriage, Mr. and Mrs. Vilcu owned a beauty and tanning salon - Upon divorce and dis­tribution of marital property, Mr. Vilcu filed an appraisal report estimating the salon's value at the time of the application - The trial judge rejected the appraisal report, ordered that the salon be sold and that the proceeds be divided equally between the parties - The Saskatchewan Court of Appeal agreed with the trial judge: "The decisions to reject the expert testimony and to order the sale of the [salon] were completely within his prov­ince as a trial judge valuing matrimonial property. Accordingly, we conclude he made no error in principle ..." - See para­graphs 13 to 16.

Family Law - Topic 882

Husband and wife - Marital property - Considerations in making distribution orders - Relevant considerations (incl. income tax) - The Saskatchewan Court of Appeal held: "If it would be unfair or inequitable to make an equal distribution having regard for the tax consequences of an order dividing matrimonial property, it is customary for a court to make an unequal distribution of assets under the authority of s. 21(2)(j) [of the Matrimonial Property Act (Sask.)]. But there must be an evidentiary base. If such a base exists, a court should strive to effect some form of balancing between the parties ... In the absence of particular reason, the evidence need not be that of experts, but ideally counsel should address such matters as the intention or need to dispose of assets, the applicable marginal tax rate and the poten­tial for tax planning to avoid the payment of tax" - See paragraphs 41 to 50.

Family Law - Topic 882

Husband and wife - Marital property - Considerations in making distribution orders - Relevant considerations (incl. income tax) - The husband, a farmer, suggested that the following assets should have been divided in specie to avoid an unequal tax consequence: farm equipment and machinery, snowplows, granaries, deferred grain tickets, grain on hand and RSP's - The Saskatchewan Court of Appeal held that there was no basis to consider the tax implications of the matri­monial division in relation to the farm equipment and machinery, the snowplows or the granaries - The court discounted the grain tickets and the grain on hand by 25% - See paragraphs 41 and 52.

Cases Noticed:

Parker v. Parker (1987), 9 R.F.L.(3d) 147 (Sask. Q.B.), refd to. [para. 21].

Ingbrigston v. Ingbrigston (1990), 27 R.F.L.(3d) 188 (Sask. Q.B.), refd to. [para. 21].

Sarvajc v. Turner (1996), 140 Sask.R. 101 (Q.B.), refd to. [para. 21].

Kofoed v. Fichter (1990), 87 Sask.R. 143; 29 R.F.L.(3d) 313 (Q.B.), refd to. [para. 21].

Tanouye v. Tanouye (1995), 134 Sask.R. 159; 101 W.A.C. 159; 10 R.F.L.(4th) 135 (C.A.), consd. [para. 22].

Deyell v. Deyell (1991), 90 Sask.R. 81; 147 W.A.C. 81 (C.A.), consd. [para. 22].

Ehlers v. Ehlers (1990), 87 Sask.R. 103 (Q.B.), consd. [para. 22].

Ellis v. Ellis (1997), 125 Man.R.(2d) 8 (Q.B.), refd to. [para. 27].

Burgmaier v. Burgmaier (1985), 47 R.F.L.(2d) 251 (Sask. Q.B.), refd to. [para. 32].

Seaberly v. Seaberly (1985), 37 Sask.R. 219 (C.A.), consd. [para. 32].

McNeil v. McNeil (1995), 133 Sask.R. 228 (Q.B.), refd to. [para. 37].

Carlson v. Carlson (1984), 34 Sask.R. 287 (C.A.), consd. [para. 45].

Shockey v. Shockey (1985), 38 Sask.R. 47 (C.A.), refd to. [para. 48].

Wolff v. Wolff (1985), 37 Sask.R. 19; 44 R.F.L.(2d) 215 (C.A.), refd to. [para. 48].

Gresham v. Gresham (1988), 72 Sask.R. 9; 17 R.F.L.(3d) 209 (C.A.), refd to. [para. 49].

Dembiczak v. Dembiczak (1985), 42 Sask.R. 314; 48 R.F.L. 113 (C.A.), refd to. [para. 49].

Statutes Noticed:

Matrimonial Property Act, S.S. 1979, c. M-61, sect. 21(1) [para. 43]; sect. 21(2)(j), sect. 21(2)(r), sect. 21(2)(s), sect. 21(2)(t) [para. 43]; sect. 23(1)(c) [para. 10]; sect. 23(2) [para. 17]; sect. 23(4) [para. 10].

Counsel:

D. Ignatiuk, for the appellant;

E.F.A. Merchant, Q.C., for the respondent.

This appeal was heard on May 13, 1998, by Bayda, C.J.S., Wakeling and Jackson, JJ.A., of the Saskatchewan Court of Appeal.

The decision of the Court of Appeal was delivered on January 19, 1999, by Jackson, J.A.