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MARRIAGE - What constitutes common law relationship

Thursday, October 08, 2020 @ 6:19 AM  

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Appeal by the husband from a trial judgment finding that the parties were spouses, awarding the wife indefinite spousal support and costs on a substantial indemnity basis. The parties separated in 2015 after a 14-year relationship. They never married and maintained separate homes. The husband was very wealthy. He told the wife he would not marry or live with her without a domestic contract. Although he prepared two such contracts, they were never signed. The parties lived together at the husband’s cottage during the summer and travelled together extensively. They kept their finances separate. The wife gave up her employment. The husband provided her and her children with a lavish lifestyle throughout the parties’ relationship. The husband denied that they were spouses as they did not cohabit. After separation, the wife became qualified as a yoga instructor and was expected to earn $24,000 in 2019. At the time of trial, she was 55. The husband was 63 at the time of trial and chairman of his family’s group of companies. The trial judge concluded that the wife satisfied Rule of 65 under the Spousal Support Advisory Guidelines for indefinite support based on her finding that the parties began cohabiting at some point in the first five months of their relationship. She awarded the wife substantial indemnity costs based on her findings that the husband acted unreasonably in his position that the parties were not spouses and in his financial disclosure.

HELD: Appeal allowed in part. The trial judge erred in finding the wife met the Rule of 65 requirements and in awarding her substantial indemnity costs. The trial judge made no error in her articulation of the legal principles for determining whether the parties were spouses. Lack of a shared residence was not determinative of the issue of cohabitation. The trial judge recognized that cohabitation required not only that the parties had a conjugal relationship but also that they lived together. She was entitled to conclude that the intermittent periods during which the parties shared a roof could, in all the circumstances, constitute living together in a conjugal relationship. The trial judge erred, however, in finding that the parties started cohabiting at some point in the first five months of their relationship. As such, the Rule of 65 did not apply. On the trial judge’s findings to determine that the parties had cohabited, the parties did not begin cohabiting within the first five months of their relationship. The trial judge gave no reasons for why she concluded that the parties began cohabiting in the first five months of their relationship for purposes of the Rule of 65. Considering the trial judge’s findings on the wife’s contributions to the relationship and the economic consequences of the relationship to her, spousal support was to be paid for 10 years. Such an order would relieve the financial hardship the wife was experiencing and make fair provision to assist her in becoming able to contribute to her own support. The trial judge also erred in finding that the husband acted unreasonably in claiming the parties were not spouses and in his financial disclosure. The husband’s legal position was reasonable even though he lost on this issue at trial. The husband’s disclosure needed to be considered in context. He made extensive financial disclosure to the wife and her lawyers during their relationship, during the proceedings, including various financial statements disclosing his personal net worth even though those statements varied in terms of how many hundreds of millions of dollars he was worth, as did the evidence on the effect of his being a discretionary beneficiary of a family trust. His means, beyond his ability to continue to support the wife at the level he had during the relationship, were not relevant. The husband did not act unreasonably because he took the position that his actual annual income was irrelevant given that his ability to pay was not in issue. The cost order was varied to partial indemnity costs.

Climans v. Latner, [2020] O.J. No. 3731, Ontario Court of Appeal, E.E. Gillese, D.M. Brown and D. Paciocco JJ.A., September 4, 2020. Digest No. TLD-October52020008