October 3, 2014

The background in Quinn vs Carrigan is well known to estate and family law litigators as the parties have been involved in extensive litigation, including two trials and two appeals.  The first trial and its subsequent appeal, which focused on the issue of who is a “spouse” pursuant to the Pension Benefits Act, led to legislative changes in Ontario.  A summary of that court of appeal decision can be found here.

By way of background to the present litigation, the testator, Mr. Carrigan, was separated but not divorced from Mrs. Carrigan at the time of his death.  He had two independent adult daughters from that marriage.  Mr. Carrigan was also survived by his common law spouse of 8.5 years, Ms. Quinn.  In his will, made prior to his separation, Mr. Carrigan left his daughters specific bequests and the remainder of the estate to Mrs. Carrigan.  During his life, Mr. Carrigan fully supported both Mrs. Carrigan and Ms. Quinn.

Following the first trial, Mrs. Carrigan and her two daughters divided Mr. Carrigan’s pension proceeds between themselves.  The second trial dealt with Ms. Quinn’s dependant support application.  The trial judge found the net value of the estate to be $1.9 million and awarded Ms. Quinn $350,000.00 from the estate.  However, after deducting the interim support she had already received and all adverse cost awards made against her, Ms. Quinn was left owing the respondents over $85,000.00.  Ms. Quinn appealed to the divisional court.

The Divisional Court found three fundamental errors in the lower court’s judgment: the misapplication of the spousal support advisory guidelines, improper reliance on Mr. Carrigan’s intention to leave Ms. Quinn a modest share of his estate, and the improper use of relative entitlement analysis to determine Ms. Quinn’s support based on the amount of support Mrs. Carrigan received without considering their different circumstances.

Also, while not a fundamental error, the court found fault with how the net value of the estate was calculated.  For example, they did not agree that Mrs. Carrigan’s credit card expenses, the daughter’s mortgage, or estimated legal fees were estate liabilities that should have been deducted from the gross value of the estate.  As a result of these errors, the court valued the net assets of the estate to be $2.4 million and not $1.9 million.

Briefly, in applying their own four step analysis to Ms. Quinn’s claim, the Division Court found

-The trial judge erred in rounding down both Mr. Carrigan’s annual income and the length of his relationship with Ms. Quinn when applying the spousal support advisory guidelines

– that it was improper to rely on Mr. Carrigan’s intention to gift Ms. Quinn only $240,000.00 from his estate.  His intention was never completed and was not enforceable, in any event; and

– applying a “relative entitlement” ratio between Ms. Quinn and Mrs. Carrigan was an error in principle.

The Divisional Court awarded Ms. Quinn $550,000.00 by relying on the higher end of the spousal support advisory guidelines plus $200,000.00 for Ms. Quinn’s moral claims.  In total, they awarded Ms. Quinn $750,000.00, or 30% of the estate.

This decision will surely be referenced in future dependant support applications as the comprehensive analysis sheds light on the difficulties of determining the proper amount of support to award dependants.

Thanks for reading.