Introduction

The court in Vargas-Hernandez v. Graff-Guerrero had to examine two frequent issues in family law cases, equalization and disclosure. In this case, the Applicant brought a motion for an advance on his equalization payment, as well as for disclosure that was still missing despite several Requests for Information.

Background

In this case, both parties were originally from Mexico. They married in 2005 and separated in January of 2023.

The Respondent was employed as a psychiatrist and earned an income of over $500,000. In comparison, the Applicant did not work outside the home and was supported by the Respondent.

Over the course of the proceedings, the Applicant served two Requests for Information on the Respondent in an attempt to obtain relevant disclosure required for his equalization and spousal support claims.

In early 2024, the Applicant brought a motion for disclosure and interim spousal support. The Respondent agreed to pay $12,000 per month in spousal support, and to provide all outstanding disclosure within two weeks.

However, by July of 2024, the Respondent had yet to satisfy his disclosure obligations. In response, the Applicant brought another motion seeking an order that the Respondent provide all outstanding disclosure. The Applicant also sought a $100,000 advance on his equalization payment, which he argued was necessary to pay his legal fees.

Analysis

The first issue in this matter was disclosure. The Applicant argued that despite there being an Order, Consent Order and serving two Requests for Information, there was still outstanding disclosure, undertakings, and refusals. The Respondent argued that a further order was not necessary, as the disclosure requested was already the subject of the previous court orders and had been substantially provided. Where the disclosure was outstanding, the Respondent submitted he made the requests and was awaiting responses.

The court agreed that the Respondent’s disclosure was incomplete, but noted that since he retained counsel, disclosure was forthcoming, satisfying the vast majority of the requests.

Based on the current status of the disclosure, it could not be said that the Respondent was failing to meet his responsibilities. As such, the court stated that the Respondent should provide a status update to the disclosure chart within 30 days.

The second issue in this matter was whether the Applicant should be awarded an advance on his equalization payment. The Respondent submitted that the Applicant failed to meet the test for granting the advance. Notably, the Applicant had already received $100,000 in uncharacterized payments from the Respondent, and spousal support in the amount of $12,000 monthly.

Under Section 9(1) of the Family Law Act, a court has discretion to order advances on equalization payments. The court summarized factors from previous case law of what should be considered in making this order. The factors include whether there is considerable certainty of the right to equalization, that the advance will not exceed the ultimate equalization payment, whether there is need, and any other circumstances related to fairness.

In this case, the parties disagree regarding the quantum of equalization owing, but there is no dispute that the payment would be substantial. There is a strong likelihood that the Respondent will have to make an equalization payment that exceeds the $100,000 advance that is sought.

However, the court was not satisfied that the Applicant demonstrated a need for the advance. The Respondent already made a $100,000 payment to the Applicant pursuant to a Consent Order. The payment was uncharacterized and unallocated. In his Affidavit, the Applicant failed to explain what happened to this money or how it was spent.

Based on the Applicant’s sworn Financial Statement, he also had a surplus of income of nearly $30,000 a year. This surplus is based on an income of $144,000 that came from spousal support. The Financial Statement also showed significant discretionary spending for non-essential expenses in the amount of $50,000. Furthermore, the Applicant’s Affidavit failed to show that he had made any efforts to obtain employment since the date of separation.

Conclusion

In conclusion, the court in Vargas-Hernandez v. Graff-Guerrero did not order an advance on the Applicant’s equalization payment. Although the Applicant would likely have been entitled to an equalization payment higher than the advance, he could not prove that the advance was needed. Further, the court did not make an order for disclosure because the Respondent had been continuously providing it as it was received.