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Summaries Sunday: OnPoint Legal Research

One Sunday each month OnPoint Legal Research provides Slaw with an extended summary of, and counsel’s commentary on, an important case from the British Columbia, Alberta, or Ontario court of appeal.

Johnson v Goyette, 2018 ABCA 353

AREAS OF LAW: Family law; Unjust enrichment; Joint family venture

~A trial judge’s finding on whether a joint family venture exists is a factual one, reviewable only for palpable and overriding error.~

BACKGROUND
The Appellant, Sandra Johnson, and the Respondent, Danielle Goyette, were in a 13-year common-law relationship. The Respondent was a professional hockey player and competed in three Olympic Games. The Appellant had somewhat greater financial means at the outset of the relationship, but the Respondent came to earn more than the Appellant over time. The only joint asset of the parties was their primary residence. The Respondent acquired other assets, including a rental condominium and interests in other ventures, using her own money. These were held in her name only. When the parties separated, the Respondent sued for an equal division of the primary residence. The Appellant counter-claimed for a share of the Respondent’s assets on the basis of unjust enrichment and joint family venture. She maintained that she undertook a majority of the domestic work, preparing food for the Respondent while she trained, provided assistant coach and administrative assistance to the Respondent after she retired from playing and became the head coach of a women’s hockey team, and assisted the Respondent with the rental condominium. The Respondent denied that the Appellant provided the bulk of these services. The Appellant did not allege that she tailored her work, education, or training plans around the Respondent’s career. The Respondent was instrumental in assisting the Appellant with finding employment, although the Appellant also alleged that she was terminated from her employment because of the Respondent. They kept separate bank accounts and credit cards but shared most expenses. Following a five-day trial, the judge found that the Appellant somewhat overstated her contributions. She found that unjust enrichment was established, but not a joint family venture. The judge also found that there was no actual intention to form a joint family venture, and that the Respondent had intended to keep her wealth separate and communicated that to the Appellant through her conduct. On the basis of quantum meruit, the judge awarded the Appellant $45,000 and directed that the parties split the value of the primary residence, as of 2016, on an equal basis. She rejected other claims of both the Appellant and the Respondent.

APPELLATE DECISION
The appeal was dismissed. The Appellant argued that the trial judge misunderstood the law of unjust enrichment as it relates to common-law partners, and consequently committed a palpable and overriding error. She further submitted that the judge ignored, forgot, or misapprehended material evidence in failing to find a joint family venture and, in making these errors, failed to remedy the disproportionate retention of the wealth accumulated during the relationship by the Respondent. The Court of Appeal found that although the trial judge may have misapprehended some of the evidence, or omitted certain evidence from her reasons, these errors and omissions did not amount to overriding and palpable errors regarding the Appellant’s contributions. The standard of review was one of palpable and overriding error, which was not made out. The trial judge found facts supporting her conclusion, including the lack of joint bank accounts, lack of joint investments, self-identification as single on tax returns, and making major purchases separately. Determining proportionate contributions of parties is not an exact science, and where the trial judge has considered all the evidence and exercised judgment in the remedy granted, the decision is entitled to deference.

COUNSEL COMMENTS

Case Comment by Laurie Allen, Counsel for the Appellant:

“Not surprisingly I find both the trial and appellate decisions in this case troublesome from a jurisprudential perspective.

Trial Decision
In family law, most trial judges are able to accurately echo the legal principles handed down by higher courts. Where the law gets messy, and difficult to apply, is when cases turn on findings of fact. In other words, broad judicial discretion can result in what some commentators have referred to as “palm tree justice”, where decisions are all over the map and value laden.

It only makes sense that, where a case turns on findings of fact, the accuracy of the trial judge’s recollection of the evidence may deteriorate over time. In this case, the trial decision was handed down more than 9 months after the trial. Most seasoned trial lawyers know that an oral decision, many months after a trial, means the trial justice has not been labouring through a carefully crafted written decision for months. Most seasoned trial lawyers also know that they are probably headed for the Court of Appeal, regardless of which way the decision falls, where the oral reasons for judgement include a statement like the following:

There was conflicting evidence on the importance of the types of contributions Ms. Johnson claims, such as meal preparation, other domestic services, and emotional support. I note that there were no expert witness on this issue and the evidence on this was personal and anecdotal.

We stated the following in our factum:

Respectfully, what evidence on the types of contributions made by a common law partner could be anything other than “personal and anecdotal”? Isn’t the “importance” of these contributions to the Respondent’s ability to acquire wealth during the relationship precisely the issue that the trial justice is supposed to determine when addressing a remedy?

Court of Appeal Decision
The take away from this decision is that appeals on findings of fact in family law cases are rarely, if ever, going to be successful. The Court of Appeal clearly found that there were numerous errors in the trial decision, so the errors were obviously “palpable” to the Court. Consequently, one has to conclude that all of the errors were not enough to “override” the decision. Respectfully, one could argue that palpable errors in findings of fact, coupled with a clear and stayed misunderstanding of evidentiary principles, would cause significant concern to an appellate panel.

The Future of the “Joint Family Venture”
The law applicable to property division between former common law couples has a tortured history. In the case of Rosa Becker, the outcome was tragic. As stated by Justice Cromwell for the Supreme Court, in Kerr v. Baranow, the legal analysis must not be “purely subjective” resulting in an unacceptable “immeasurable judicial discretion” that would permit “case by case palm tree justice”.

In my view, unsatisfactory value laden decisions on property division for former common law couples can only be minimized by fettering judicial discretion with legislation. This is the yin and yang of all juris prudence – balancing private justice with public certainty. Hence the Alberta Matrimonial Property Act of 1978, the Federal Child Support Guidelines of 1977, and the Federal Advisory Spousal Support Guidelines of 2008.

Numerous provinces have extended their legislation relating to matrimonial property division to common law couples who have cohabited for more than 2 or 3 years. In September 2017 the Alberta Law Reform Institute recommended that Alberta do the same. The Government of Alberta will table a bill on November 21 making this change to Alberta law. Once the legislation is in place, there is presumptively an equal sharing of property acquired by parties during a common law relationship.

This is small comfort to the Defendant/Appellant in this case. Her case constitutes yet another example of how expensive, time consuming and risky litigation in this area is. This case has pushed forward socially progressive legislation reflecting the reality of common law partners. The law of unjust enrichment and “joint family venture” constitutes a barrier to settlement, and is therefore a barrier to access to justice for many common law partners.

The avalanche of litigation between common law partners, arising in jurisdictions where there is still no governing legislation, will eventually come to an end. The whole argument that people should have a “choice” as to whether or not they share property with their partner is simply bound to fail. As Professor Winifred H. Holland said “the flip side of one person’s autonomy is often another’s exploitation” (Winifred H. Holland Marriage and Cohabitation – has the time come to bridge the gap? in Special Lectures of the Law Society of Upper Canada 1993 – Family Law: Rules, Fairness and Equality, Scarborough, Ontario: Thompson, 1994, 369 at 380).

To conclude, we lost a battle, but I firmly believe we will win the war.”

Case Comment by Abraham Fares and Robert Knight, Counsel for the Respondent:

“The Court of Appeal decision on Goyette follows the appeal of a five day trial in September 2016. The Plaintiff, Danielle Goyette, was a member of the national women’s hockey team and participated in the Olympics in 1998, 2002 and 2006 and then later as a coach for the women’s national team as well as in over 20 world cups.

The facts were unique in that both parties had absolute separate finances. The separation extended to bank accounts, investments and all property save and except for a home in which they both contributed equally to the maintenance of, dividing property taxes, insurance, household maintenance etc. These parties divided their grocery bills 50/50. They would divide restaurant meals 50/50. All aspects of their financial life were divided 50/50. Meticulous accounts were kept and they reconciled expenses on a weekly or monthly basis. Those were the uncontroverted facts. There was no evidence that either party gave up career choices or moved as a result of the other’s career. This unique type of financial arrangement was maintained until they ended their relationship.

The trial judge undertook a comprehensive analysis of the law and applied the law to the facts. Through the exercise of judicial discretion Mme Justice Dario found there was no joint family venture but that there was unjust enrichment . The Court of Appeal appears to have scrutinized whether certain facts were considered in both analysis (i.e., the joint family venture test versus unjust enrichment analysis). In the end the Court of Appeal found that there were facts to support the trial judge’s conclusions. The standard of review was reasonableness and the Court of Appeal did not disturb the trial judge’s decision as there was no overriding and palpable error.

The majority in Kerr recognized that all common law couples are not a homogenous group and that one has to look at the facts in making decisions concerning unjust enrichment and joint family venture. The very unique facts of this case make its use as a precedent limited.”

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