NOVA SCOTIA COURT OF APPEAL Citation: Goyetche v. Goyetche, 2006 NSCA 24 Date: 20060222 Docket: CA 252756 Registry: Halifax Between: Eileen Elizabeth Goyetche v. David Thomas Goyetche Respondent Judges: Bateman, Saunders Hamilton, JJ.A. Appeal Heard: February 14, 2006, in Halifax, Nova Scotia Held: Appeal allowed with costs and case remitted to the Supreme Court of Nova Scotia for a rehearing on an expedited basis, as per reasons of Saunders, J.A.; Bateman and Hamilton, JJ.A. concurring. Counsel: Peter Lederman, Q.C., for the appellant Alain Bégin, for the respondent Reasons for judgment: [1] Cross applications were filed by Mr. & Mrs. Goyetche in Supreme Court Chambers on April 13, 2005 and April 21, 2005 respectively: his seeking orders to terminate spousal support, to sell the matrimonial home, and to return to him certain personal belongings; and hers seeking orders to provide her with interim spousal support, as well as payment of support arrears and a reinstatement of her benefits under his medical insurance plan. [2] These two interlocutory applications were heard by Justice J. E. Scanlan on June 28, 2005. Both parties testified and were subject to cross-examination. In an oral decision at the conclusion of the hearing Justice Scanlan ordered, among other things, that the matrimonial home be put up for immediate sale; that Mr. Goyetche continue to pay Mrs. Goyetche $800.00 per month in spousal support terminating on June 1, 2006; that Mrs. Goyetche immediately return to Mr. Goyetche certain personal belongings; that Mr. Goyetche continue to pay the monthly mortgage payments on the matrimonial home, with all such payments made after June 28, 2005 credited to him from the sale proceeds of the home; and that the equity in the matrimonial home would be divided equally between the parties after first deducting legal fees and real estate commission. [3] Mrs. Goyetche appeals the decision claiming reversible error on the part of the Chambers judge in two respects: first, that he had no evidence before him to justify selling the matrimonial home and divide the proceeds of sale equally between the parties, and that he was influenced by irrelevant considerations relating to the behaviour of the appellant. [4] The standard of review we apply in cases such as this is well known. This court will not interfere with discretionary order, especially an interlocutory one such as arose here, unless wrong principles of law have been applied or patent injustice would result. See, for example, Exco Corporation Limited v. Nova Scotia Savings Loan et al (1983), 59 N.S.R. (2d) 331(C.A.); The Attorney General of Canada v. The Foundation Company of Canada Limited et al (1991)(C.A.); Minkoff v. Poole (1991), 1991 CanLII 2516 (NS CA), 101 N.S.R. (2d) 143 (C.A.); Temple v. Riley (2001), 2001 NSCA 36 (CanLII), 191 N.S.R. (2d) 87 (C.A.); and National Bank Financial Ltd. v. Mahoney, 2005 NSCA 139 (CanLII). [5] After carefully considering the record and the submissions of counsel, we are satisfied that this is case where we ought to intervene and set aside certain provisions of the order under appeal. [6] We need not address what the appellant has rather obliquely attempted to characterize as errors of law, but which might more accurately be described as too precipitously ordering the sale of the matrimonial home on an interlocutory basis without the benefit of professional appraisal or any compelling and urgent reason to do so; and complaining that the Chambers judge formed negative opinion of the appellant’s credibility from her admittedly frequent and expensive bingo playing habits. [7] Rather, the reason for our intervention is that when considering these cross-applications the course of action urged upon the judge by counsel resulted in patent injustice to the appellant, albeit quite unintended. [8] As the parties agreed and as the judge made clear in his decision, this case presented very unique set of circumstances. The appellant, Eileen Goyetche, was born on June 5, 1941. The petitioner/respondent, David Goyetche, was born on March 11, 1941. Each will turn 65 this year. They were married on August 18, 2001, but did not live together for the first 18 months due to Mr. Goyetche’s employment out of province. They separated on July 15, 2004. [9] Mr. Goyetche’s petition for divorce is dated January 10, 2005. Prior to the marriage Mrs. Goyetche owned her own home in Bible Hill and supported herself on social assistance disability benefits. Those benefits were terminated when the couple married. At that time the outstanding balance on her mortgage was approximately $33,500.00. Just prior to their marriage she transferred title to her home into both their names. They remortgaged the house, leaving new mortgage balance of close to $48,000.00. The borrowed money was used in renovation projects and household improvements including new dishwasher, carpeting, sunporch and garage. [10] Pursuant to an interim order, Mr. Goyetche was paying spousal support of $800 monthly. Mrs. Goyetche could not reside in the home without the maintenance continuing. Mr. Goyetche saw her continued living in the home as untenable, if it required him to continue support and mortgage payments indefinitely. He saw the sale of the home as solution to the dilemma. Mrs. Goyetche would not agree to sell the home. Matters were at an impasse. Their situation required judicial intervention. Since ceasing employment, Mr. Goyetche has maintained himself on modest pension and investment income. To this point he has had to live with relatives. Primary in Mr. Goyetche’s mind was to get his name off the title to the house and the mortgage, and see to the quick return of certain valuable personal belongings. Mrs. Goyetche’s troubles were equally pressing. She had been cut off her husband’s medical insurance coverage. She needed spousal support because her social assistance disability pension had been terminated when she married, and she wouldn’t receive any further income until she starts receiving old age security and CPP at age 65 on June 5, 2006. She wanted title to her house back. It was in this context that Mr. Goyetche applied for an interlocutory order that the home be sold. It was obvious to the judge and the parties that it would be impossible for Mrs. Goyetche to maintain the matrimonial home with its attendant monthly mortgage obligations without financial assistance. Evidently Justice Scanlan saw no alternative but to order its immediate sale. [11] The documentation and testimony at the hearing make it plain that three simple matters drove Mr. Goyetche’s application: first, he wanted to stop paying support to his wife; second, he wanted his name “off” the mortgage on the matrimonial home so that he could then finance his acquisition of new residence for himself; and finally, he wanted returned his surround sound stereo system and certain valuable collector’s items, including an antique knife and an autographed Mickey Mantle baseball. [12] There was no mention of any division of matrimonial assets in the interlocutory notice filed by the petitioner on April 13, 2005. That request for relief only came up in an exchange between the judge and Mr. Goyetche’s lawyer during the hearing. This suggestion obviously troubled Justice Scanlan as can be seen in this extract during Mr. Goyetche’s direct examination when questioned by his own counsel: MR. BEGIN Q. you’re now caught up to date and you paid $800 per month up to and including the June of 2005, is that correct? A. November is when started paying $400. Before that, it was verbal agreement that we had made on paying the 800. had offered to pay the $800, plus $500 mortgage. And asked for my stereo and surround sound system, and as soon as received it, the $800 would continue. And was never offered any kind of concession on that. THE COURT So the order that was in place, though, as understand it, says $800 per month starting February the 14th, 2005. THE COURT But you’re saying you only paid 400 month? A. In November, yes. started in THE COURT Okay. A. in November when told her that as soon as received my equipment, that the $800 would be followed and paid up to date immediately. A. am well, I’m caught up with full payments on April, May and June, and still owe 400 from March and February. THE COURT Okay, that’s what thought you said in the first instance, so. MR. BEGIN So just February and March are 400, all the rest are $800, correct? A. Yes. Q. Okay. And on top of that, sir, you’re paying $535 month on mortgage? Q. And you’ve done it since separation. Q. And you’re also asking the Court today to return certain equipment? A. Yes. Q. And can you advise His Lordship what equipment or possessions you’re looking for? A. I’m looking for my stereo system that purchased in 1999 and my surround sound system. And on top of that, have an autographed Mickey Mantle baseball, safety award millennium silver dollar uncirculated, and collector an American collector knife that was absconded, and I’ve never been able to find it. THE COURT have the autographed baseball, collector’s knife. What else was it? And stereo and surround sound. MR. BEGIN millennium uncirculated silver dollar safety award. THE COURT Safety award silver dollar. And what else? Did miss something? A. have Bowe’s [(sic) BOSE] stereo system. THE COURT Yeah, have that. Q. In paragraph 13, you talk about not being able to afford home until you have your name off the mortgage in the matrimonial home. A. That’s correct. Q. Just tell His Lordship what you’ve done or what you’ve tried to do in relation to that? A. Well, didn’t know how stood as far as buying new furniture to relocate myself in an apartment building. was told by some people that if paid and bought all that, that would be included into marriage and would have to declare that as assets which would have to be divided. So ended up had uncles and aunts that were good enough to let me stay there until this problem had been solved so that could get on with my own life. And so I’m paying those people in lieu of apartment living or house buying. Q. But are you able to get mortgage, sir, on new home while your name is on the home on Guest Drive? A. would not be able to, no. don’t believe. THE COURT Counsel, aren’t we dealing there with division of matrimonial property. Are you asking me to make final division of property here today? And are you not asking me to do something which really don’t have authority to do and that is to have the bank release him from mortgage? MR. BEGIN We’re asking for an order to sell the home, My Lord, is what we’re asking for. Interestingly, when we were here before think it was Justice Cacchione Mr. Lederman said, Geez, you know, we basically what Your Lordship just said, aren’t we almost dealing with the divorce? And that’s why it was put over to today so we could deal with the various issues. Whatever happens today is pretty much the [order?] think my friend will confirm that. See most of the assets [inaudible] THE COURT Do have another application on file other than Okay, there are two applications. For the 13th and 21st then, of April. Okay, good. Sorry. MR. LEDERMAN Maybe if could just clarify what meant when made that comment. It struck me that when this application was brought, that what my friend was looking for basically was determination of all issues in dispute between these people [on an interim basis?] in Chambers’ Application. What asked Justice Cacchione to do was give us date for the divorce itself so we could deal with everything. But mean, guess it’s six of one and half-a-dozen of the other, but that was my decision. Still is. But we’re here so if we can deal with it, well, perhaps we should. Put this thing [inaudible] THE COURT No, the only concern had, counsel, was as was digging through the file, got to the application of April 21st and assumed that’s what we were proceeding on. And only when you raised did realize in terms of the history of the proceedings that there’s another application before the court. And assume that we’re hearing them both now. MR. BEGIN Yes, My Lord. THE COURT Okay. And that’s why asked, Are you not asking me to do something under the Matrimonial Property Act when it wasn’t really before me. But it is. And that’s pursuant to the April 13th application. MR. LEDERMAN That’s correct. THE COURT That was why asked the question. MR. LEDERMAN Okay. [Underlining mine] [13] The fact is that Mr. Goyetche did not file his application with any expressed intention to claim an equal division of the net proceeds realized upon sale of the matrimonial home. Yet this point has evolved into the principal issue on appeal. It obviously took Mrs. Goyetche’s counsel by surprise. In the portion of the transcript just quoted it would appear that Mr. Lederman resiled to the suggestion, without much protest that the judge address the asset division on the interlocutory application. He now candidly and properly admits that this was mistake on his part. We agree. To quote his factum Mr. Lederman gives this explanation at and 10: 9. It certainly struck me as odd and out of the ordinary to deal with division of property by way of an application that usually deals with interim relief only pending trial. 10. then went on to muse as follows: “But mean, guess it’s six of one and half dozen of the other, but that was my decision. Still is. But we’re here so if we can deal with it, well, perhaps we should.” In retrospect, that was not the appropriate reaction, and should have been more vociferous in my objections to proceeding. [Underlining mine] [14] In our respectful view, there was no evidence to warrant proceeding with the applications in the manner suggested by counsel. We disagree with Mr. Bégin’s submission at the hearing that the value of the house is irrelevant to the issue of its sale and that we ought to uphold the order directing its immediate sale, with the added direction that proceeds be kept in trust until each of their respective interests is determined. In our view, in the unique circumstances of this case, it is unrealistic and unfair to address the issue of selling the house without at the same time taking the value of the house, and the parties’ individual contributions to that value into account when then classifying, quantifying and dividing matrimonial assets. Without knowing the value of the equity remaining in the house, it is simply impossible to say whether the amounts Mr. Goyetche feels he contributed (over and above the increased mortgage) were truly realized in any actual increased value to the property. This was acknowledged by the petitioner himself in cross-examination: Q. So what exactly is your position with regard to that house today? A. Well, don’t know what my position is. was told to get out of there on August 9th. A. I’ve increased the value of that home lot since we were married. Q. Okay, you realize she has no way of raising funds to get A. Well, that’s wish she did and then we wouldn’t be into this situation. Q. Yeah. Do you have any idea of what the increase in value has been? No, sir. I’m not into real estate; have no idea. would have to have professional go and appraise it. [Underlining mine] [15] At no time does Mr. Goyetche quantify the division of property he is looking for, let alone express the view that he is seeking an equal division of all matrimonial assets, or specifically half of the home equity. We see this in the following exchange between Mr. Goyetche and Mr. Lederman during cross-examination: Q. Okay, well, are you prepared to sign the title back to her? A. Well, I’m prepared to sign the title over back to her providing get some of the money that put into it when we were married. [16] At one point in his judgment the Chambers judge writes: If the property is worth $170,000.00 as Mr. Goyetche suggested We can find no substantiation for such sum in the record. At one point in his evidence, Mr. Goyetche opined that the house might be worth $150,000.00, but its actual value was never properly established. [17] It is unfortunate that the hearing went off track with an approach to the proceedings taken at the behest of counsel. This ultimately led to an obvious and immediate injustice to the appellant. The fair division of property between the parties, including the matrimonial home, should only be decided upon proper record, with all assets of the parties considered and when both Mr. Mrs. Goyetche have been given the opportunity to present their evidence. This should at the very least include professional appraisal; an accurate accounting of mortgage payments with the current balance shown; documentation verifying the renovations and improvements made to the home (with available receipts); and evidence concerning Mr. Mrs. Goyetche’s respective contributions to those efforts, bearing in mind the “presumption” favouring an equal division pursuant to sections 12 13 of the Matrimonial Property Act, R.S.N.S. 1989, c. 275. [18] We will intervene so as to correct a patent injustice. However, we wish to ensure, as best we can in the circumstances, that proceedings are not delayed and that the parties move with all dispatch to arrange for an expedited rehearing, should that be necessary. [19] We would therefore: (i) allow the appeal; (ii) temporarily vacate ¶ 1 Justice Scanlan’s order dated July 19, 2005 so as to permit the parties a reasonable opportunity to make timely alternative arrangements to resolve the matters in issue, consensually, short of selling the matrimonial home. This might include, for example, Mrs. Goyetche arranging for refinancing of her equity in the home in order to settle payment of Mr. Goyetche’s interest. Should those efforts prove unsuccessful, of Justice Scanlan’s order will be restored and reactivated effective May 30, 2006, thereby authorizing the immediate sale of the matrimonial home without delay or impediment by either party (for clarity, that provision is reproduced herewith); 1. THAT the matrimonial home at 70 Guest Drive shall be put up for immediate sale. THAT Eileen Goyetche shall cooperate fully with the real estate agent for the purpose of permitting the real estate agent to prepare the home for listing, and Eileen Goyetche will further cooperate fully with the real estate agent for all showings. (iii) direct that Mr. Goyetche’s obligation to continue paying the mortgage on the matrimonial home shall continue, under this Order, only until the earlier of either the sale of the matrimonial home, or June 2, 2006 (being the day after the June mortgage payment is due). This provision does not, however, alter the legal responsibilities either party may have to the bank under their mortgage, for payment of the monthly mortgage amounts or the principal secured; (iv) strike of the said order (for clarity, that provision is reproduced herewith); 8. THAT subject to the previous paragraphs, the equity in the matrimonial home shall be divided equally between both parties after the payment of legal fees and real estate commission. (v) direct that the case be remitted to the Supreme Court on an expedited basis for rehearing and proper determination (should such rehearing be necessary) based on these directions, which hearing should include final determination on the apportionment of all assets of the parties; (vi) direct that on any final division of assets the judge shall be at liberty but not obliged to include the value of the personal items already determined to belong to Mr. Goyetche, no appeal having been taken with respect to that allocation. [20] We see no reason why the matter could not be heard again by Justice Scanlan, should his schedule permit it. Findings of credibility were entirely within his province and do not require any comment from this Court, should he choose to take up the case again. They may have no bearing at all on the matters yet to be decided. The facts and history of the case are obviously well known to him and it might accelerate these proceedings and bring about more timely conclusion if he were able to hear it. Otherwise the matter could be directed to any other member of the Supreme Court. [21] In the unusual circumstances of this appeal, Mr. Goyetche shall have costs in the amount of $1,500 inclusive of disbursements, in any event of the cause, but not payable until the earlier of either the sale of the matrimonial home, or final settlement of the issues outstanding in this matter. Saunders, J. A. Concurred in: Bateman, J. A. Hamilton, J. A.
In the context of a divorce proceeding, the husband filed an interlocutory application for, inter alia, the termination of spousal support, and the sale of the matrimonial home. The Chambers judge ordered that the matrimonial home be sold and the assets equally divided between the spouses. The wife appealed. Appeal allowed; certain provisions of the Order struck or temporarily lifted to permit the parties a reasonable opportunity to make timely alternative arrangements to resolve the matters in issue consensually, short of selling the matrimonial home; the court's intervention was necessary to prevent a patent injustice. There was no mention of any division of matrimonial assets in the notice filed by the husband and in the unique circumstances of this case, it was unrealistic and unfair to address the issue of selling the house without at the same time taking into account its value and the parties' individual contributions to that value.