IN THE SUPREME COURT OF NOVA SCOTIA (FAMILY DIVISION) Citation: Mabey v. Mabey, 2004 NSSF 92 Date: 20041021 Docket: SFHD-027715; 1201-50517 Registry: Halifax Between: Stephen Lee Mabey v. Susan Margaret Mabey Respondent Judge: The Honourable Justice Kevin Coady Heard: September 20, 2004 in Halifax, Nova Scotia Counsel: Mark Knox, for Susan Mabey Gordon R. Kelly, for Stephen Mabey By the Court: [1] Susan and Stephen Mabey were divorced in 1996 after 20 year marriage. They have children who are adults and who have completed their post-secondary education. The oldest, Melissa, attended Boston College from 1995 to 1999. significant source of funding for Melissa’s education came from american “Federal Plus” loans. Ms. Mabey has american citizenship and as such was the only family member who could secure these loans. The balances of these loans are coming due. Ms. Mabey claims an agreement with Mr. Mabey that he would be responsible for these outstanding obligations. [2] In anticipation of collection proceedings, Ms. Mabey brought Divorce Act application against Mr. Mabey. While she cited various forms of relief, the tenor of the application was retroactive. Pre-trial conference discussions led to Ms. Mabey filing an originating notice seeking the same relief in contract. She seeks consolidation so that there would be one hearing. Mr. Mabey brings an application pursuant to Civil Procedure Rule 14.25 to strike out Ms. Mabey’s Divorce Act application. That is the application before this court. [3] Ms. Mabey’s Divorce Act application seeks relief in several forms. She seeks a variation in relation to spousal support and a retroactive child support order, both designed to cover Melissa’s past educational costs. She also seeks declaratory relief, exemplary or punitive damages and costs. The declaratory relief added nothing to the application and the punitive damages were not argued in either written or oral submissions. [4] The spousal support waiver in this couples corollary relief judgment and the lack of any material change in circumstances takes spousal support out of the picture. The essence of Ms. Mabey’s application relates to child support. The form of relief means little to Ms. Mabey. find that this application is an effort to either enforce the corollary relief judgment and amendment, or in the alternative, to retroactively vary the child support provisions. Both have as their goal to shield Ms. Mabey from Melissa’s outstanding loan obligations. [5] The proceedings in contract seek the same relief. Mr. Mabey has filed defence and added Melissa as third party. He bases this action on his position that Melissa was responsible for these loans upon graduation in 1999. Mr. Mabey is not seeking to strike out this proceeding, and in fact argues that it is the proper vehicle to resolve this issue. [6] It is helpful to review Mr. Mabey’s overall child support obligations as set out in the 1996 corollary relief judgment. He was required to pay $1500. per month for each of the other children while they were in high school. That amount was reduced to $1400. per month while they were in university. Additionally he was required to make contributions to their university education in an amount that “he shall negotiate with each such child” and in an amount that “he is in position to contribute.” Ms. Mabey makes no assertion that Mr. Mabey has failed to meet these obligations. Mr. Mabey’s income at the time ($186,000.) allowed him to honour these obligations whereas Ms. Mabey’s income ($30,000.) limited her ability to contribute to post-secondary education. [7] Mr. Mabey’s support for Melissa since 1996 is not disputed. The corollary relief judgment required him to pay $1400. per month until Melissa completed one post-secondary degree. The total of those payments is $51,800. [8] Melissa’s first “Federal Plus” loan was drawn down in 1995 in the approximate amount of $25,000. (U.S.). This loan was specifically addressed in this couples 1996 corollary relief judgment. Between 1995 and 1999 Mr. Mabey serviced this debt in the amount of $15,399. (Can.). In January, 2004 he paid off this 1995 loan in the amount of $29,719. (Can.). Between 2000 and 2002 he serviced all “Federal Plus” loans in the amount of $35,210. (Can.) He also paid off an unrelated student loan in the amount of $12,838. (Can.). Mr. Mabey’s total support for Melissa, between 1996 and 2002, amounts to $144,967. (Can.). [9] The balance of Melissa’s “Federal Plus” loans presently is $36,000. (U.S.). Ms. Mabey argues this balance is the responsibility of Mr. Mabey. He argues that the obligation belongs to Melissa. Neither Melissa nor Ms. Mabey have paid anything on the “Federal Plus” loans. Ms. Mabey paid Melissa $400. (Can.) per month while she was at Boston College. Melissa is presently employed in Boston. She is estranged from her father and denies any obligation for the outstanding balance. [10] find that the first loan in 1995 must be viewed differently than those negotiated after 1996. Paragraph 10(a) of the corollary relief judgment states: 10. Debts and Obligations (a) The Husband shall be solely responsible for debts now in his name, and the Wife shall likewise be solely responsible for debts now in her name, save only as respects liability for United States Federal Plus loan in the Wife’s name. The United States Federal Plus loan in the Wife’s name was obtained solely for purposes of education of Melissa Mabey. The principal amount of that loan as at June, 1996 is U.S. $25,194.87. Its terms are set out in the Loan Agreement between the United States Government and the Wife. The Husband herein shall, as between the parties to this Agreement, be responsible for its repayment and his sole recourse shall be against Melissa Mabey. [11] Clearly, the parties acknowledged this existing obligation and came to an agreement as to it’s repayment. The record establishes that Mr. Mabey has complied in full as of January, 2004. [12] Paragraph 6(o) of the corollary relief judgment anticipates how this couple would deal with any future costs of post-secondary education: University Expenses (o) As each Child enters post secondary education and periodically thereafter, the Father shall discuss with that Child his or her reasonable expenses based on attendance at Canadian university, and shall negotiate with each such Child such financial support as he is in position to contribute to that Child’s post secondary education. Likewise, the Mother shall contribute financially or otherwise as she can, to assist each Child’s post secondary education. Such financial support is contingent upon ability to pay, and on the assumption that such Child or Children are in continued and regular full-time attendance at university, college or vocational institution and that such Child or Children maintains passing average in each academic year. This clause satisfies me that the parties left open the subject of funding post secondary education for all of their children. [13] Paragraph 13(c) of the corollary relief judgment provides: This agreement may be amended only by further instrument in writing signed by the husband and the wife and witnessed. There has been no such instrument signed by both parties. [14] It became apparent in 1997 that Melissa would require further “Federal Plus” loans to complete her degree. Ms. Mabey was not prepared to sign for any additional loans given her financial circumstances. She looked to Mr. Mabey to indemnify her for any future obligations owed to the “Federal Plus” program. [15] On January 20, 1997 Mr. Mabey was the sole signatory to the following document: Whereas Melissa Mabey, daughter of Susan Mabey and Stephen Mabey, needs to obtain additional United States Federal Plus Loan (hereafter referred to as “Loan”) for the sole purpose of completing her undergraduate education at Boston College; And, whereas the Loan can only be obtained by citizen of the United States, And, whereas Susan Mabey as citizen of the United States qualifies to apply for the Loan on behalf of Melissa Mabey; And whereas Section 10 (a) of the Divorce Settlement Agreement dated June 1996 between Susan Mabey and Stephen Mabey sets out the following responsibility for the initial United States Federal Plus Loan: The Husband herein shall as between the parties to this Agreement, be responsible for its repayment and his sole recourse shall be against Melissa Mabey. And whereas Susan Mabey desires the same undertaking in consideration for her obtaining additional United States Federal Plus Loans for the sole purpose of Melissa Mabey completing her undergraduate education at Boston College; And whereas Melissa Mabey has acknowledged that the initial and subsequent United States Federal Plus Loans are her responsibility and given her personal undertaking to Stephen Mabey that she is responsible for the repayment of these loans; And whereas Stephen Mabey has agreed to service these loans on behalf of Melissa Mabey while she is attending university (both undergraduate and graduate); I, Stephen Mabey, agree to be responsible for the repayment of the additional United States Federal Plus Loans made to Susan Mabey for the purposes of Melissa Mabey completing her undergraduate education at Boston College and that my sole recourse shall be against Melissa Mabey. [16] On the basis of this document, Ms. Mabey secured several loans to pay for Melissa’s education. [17] Ms. Mabey takes the position that this document amounts to an amendment to the corollary relief judgment. Paragraph 13(c) requires any amendment to be signed by both parties. therefore find that this document does not alter the original agreement. No agreement can be unilaterally changed. Mr. Mabey’s document may be amenable to an argument in contract. Given this conclusion, I find that Mr. Mabey has complied with his child support obligation as set out in the corollary relief judgment and there is nothing to enforce. [18] The second aspect of Ms. Mabey’s application seeks “A retroactive child support order concerning the child, Melissa Sue Mabey ... to cover loan payments for educational purposes for the child”. In effect Ms. Mabey is seeking $36,000. (U.S.) in retroactive child support. accept Mr. Mabey’s submission that the relief sought amounts to variation application pursuant to the Divorce Act. [19] It is well established that variation, either retroactively or prospectively, requires material change in circumstances. In effect, something must have occurred that was not in the parties knowledge or contemplation at the time of the last order. Section 17(4) of the Divorce Act provides as follows: Before the Court makes variation order in respect of child support order, the Court shall satisfy itself that change of circumstances as provided for in the applicable guidelines has occurred since the making of the child support order or the last variation order made in respect of that order. [20] Section 14 of the guidelines sets forth the circumstances for section 17(4) application to vary. Section 14(a) does not apply as there has not been prior guideline order. Section 14(c) is not applicable as it was anticipated in the parties separation agreement. Section 14(b) applies to the circumstances where there is not “determination made in accordance with table”. successful variation would require “any change in the condition, means, needs or other circumstances of either spouse or of any child who is entitled to support”. [21] In Willick v. Willick, 1994 CanLII 28 (SCC), [1994] S.C.R. 670 the Court stated: In deciding whether the conditions for variation exist, it is common ground that the change must be material change of circumstances. This means change, such that, if known at the time, would likely have resulted in different terms. The corollary to this is that if this matter which is relied on as constituting change was known at the relevant time it cannot be relied on as the basis for variation. [22] In the Mabey’s case, the question for the Court is whether the additional loan payments were known or anticipated at the time of the corollary relief judgment. [23] The parties separation agreement, as incorporated in the corollary relief judgment, is comprehensive in its scope. Paragraph acknowledges that the parties have exchanged financial disclosure prior to signing the agreement. They both had independent legal advise. Child support is set forth in considerable detail and addressed support during both high school and university. Section 10 specifically addresses responsibility for the first of the “Federal Plus” loans for Melissa. [24] Section anticipates variation applications. It eliminates the coming into effect of the guidelines as basis for variation. Otherwise it captures the intent and language of section 17 of the Divorce Act. [25] What if anything has changed since 1996 that was not known or anticipated by the parties? Mr. Mabey continues in his employment with local law firm. His income has, no doubt, increased but there is no evidence of windfall. The parties anticipated budgets in 1996 and set child support levels to reflect normal increases into future years. Mr. Mabey negotiated post-secondary support for Melissa as was envisaged in Section 6(o) of the separation agreement. Ms. Mabey continues to be employed with an insurance firm and her income, means and circumstances have not materially changed. Melissa has completed her education and is employed in Boston. The post 1996 “Federal Plus” loans were negotiated as per Section 6(o) of the Separation Agreement. The evidence does not disclose any development that was not known or anticipated in 1996. [26] have considered the law on retroactive child support. In particular have considered the review of L.S. v. E.P. (1999), 1999 BCCA 393 (CanLII), 50 R.F.L. (4th) 302 (B.C.C.A.) As analysed by Williams, J. in Davey v. Davey (2002), 2002 NSSF 29 (CanLII), 205 N.S.R. (2d) 367. have considered the factors mitigating in favour of retroactive order and the factors that mitigate against. These factors are of little consequence given the limited nature of this application. The critical issue is the threshold test of material change in circumstances as defined in law. [27] am unable to determine that there has been material change in circumstances since the signing of the separation agreement. The only factor advanced in support is Melissa’s loan payments for educational purposes. The need for additional educational funding was within the parties contemplation in 1996 and was provided for in their agreement. find that Ms. Mabey cannot meet this critical requirement of Section 17 of the Divorce Act. [28] The next question is whether the above determination is sufficient to attract the “striking out” provisions of Civil Procedure Rule 14.25. [29] accept that this Rule is an exceptional form of relief and should be utilized in only the rarest of cases. In W.(W.L.) v. Nova Scotia (Minister of Community Services) (2002), 2002 NSCA 129 (CanLII), 210 N.S.R. (2d) 113 (N.S.C.A.) Roscoe J.A. stated the following concerning the test in Rule 14.25. .. It is well settled that on an application pursuant to Rule 14.25 to strike out an action, judge must proceed on the assumption that the facts contained in the pleadings are true and assuming those facts to be true, consider whether claim is made out. An order to strike out statement of claim will not be granted unless on the facts as pleaded, the action is obviously unsustainable. [30] In Saunders v. Hendry, [1999] N.S.J. No. 366 (N.S.S.C.), Rule 14.25 was considered by Goodfellow J. He stated: With respect to the application under C.P.R. 14.25, will refer to two decisions, Sherman v. Giles (1994), 1994 CanLII 3964 (NS CA), 137 N.S.R. (2d) 52 (N.S.S.C.) and the recent decision Labour Relations Board (Nova Scotia), et al v. Future Inns of Canada Inc. N.S.C.A. July 16, 1999 per Pugsley, J.A. am conscious that the law requires the exercise of discretion in determining whether or not to strike all or part of pleading is to be exercised with great care and caution and only in the most exceptional and clear circumstances. [31] In Roulston v. Nova Scotia (Attorney General), (1994) 1994 CanLII 4149 (NS CA), 130 N.S.R. (2d) 44 (N.S.C.A.) Roscoe, J.A. stated that the question under Rule 14.25 is not whether there is good defence to an action, but whether the statement of claim discloses cause of action. [32] In Hunt v. Carey Canada Inc. 1990 CanLII 90 (SCC), [1990] S.C.R. 959 the court stated that the test on an application to strike is assuming that the facts as stated can be proven, is it “plain and obvious” that the plaintiff’s statement of claim discloses no reasonable cause of action. The court further stated that neither the length or complexity of the issues, the novelty of cause of action, nor the potential for the defendant to present strong defence should prevent the plaintiff from proceeding with his or her case. Only if the action is certain to fail because it contains radical defect should it be struck. [33] Civil Procedure Rule 14.25 provides as follows: (1) The Court may at any stage of proceeding order any pleading, affidavit or statement of facts, or anything therein, to be struck out or amended on the ground that, (a) It establishes no reasonable cause of action or defence; (b) It is false, scandalous, frivolous or vexatious; (c) It may prejudice, embarrass or delay the fair trial of the proceeding; (d) It is otherwise an abuse of the process of the Court. And may order the proceeding to be stayed or dismissed or judgment to be entered accordingly. [34] find that the application to vary discloses no reasonable cause of action. The total lack of any material change in circumstances is “radical defect” to proceeding to assess the matter on the so-called merits. I would not describe the application as scandalous or vexatious, but in light of my earlier findings, it can be described as frivolous. [35] There is ample evidence before the Court to determine this action is, in essence, matter of contract. The indemnity agreement may be something that Ms. Mabey can rely on as promise made to her in the event that she is called on to pay the balance of the “Federal Plus” loans. [36] The pleadings and submissions of Ms. Mabey indicate she is not concerned about the form of relief, whether it be child support order, spousal support order or judgment. This indicates to the Court that her main issue is debt and who is responsible for that debt. It is noteworthy that these debts are outstanding and neither Melissa nor Ms. Mabey have been required to pay any of these outstanding obligations. [37] am also persuaded that neither Ms. Mabey nor Mr. Mabey treated these obligations as child support. Mr. Mabey did not take the deduction as contemplated in their agreement and there is no evidence Ms. Mabey declared it as income. [38] In conclusion I am satisfied that Mr. Mabey’s application pursuant to Civil Procedure Rule 14.25 succeeds. Accordingly I will strike out Ms. Mabey’s amended application filed on January 28, 2004. [39] Mr. Mabey is entitled to costs. In the event the parties cannot agree on quantum, will accept submissions.
The husband applied to have the wife's application for retroactive child support to cover the costs of the child's post-secondary education struck as a matter more properly addressed as an issue of contract. In addition to the child support ordered in the Corollary Relief Judgment, the husband had signed a document in which he agreed to repay the costs of the daughter's American student loans (which had to be obtained in the wife's name as the wife was an American). The wife had also brought a separate action suing the husband in contract to enforce this obligation. Application granted; wife's application for retroactive child support struck as 'frivolous'. There was no evidence of the required change in circumstances necessary to support a variation application, there was nothing to enforce in the Corollary Relief Judgment as the  husband had met his obligations under that Order and the agreement he signed to repay the student loans was not binding under the Corollary Relief Judgment as it was not signed by both parties.