P. (S.) v. R. (M.)

P. (S.) v. R. (M.)
Collection
Supreme Court Judgments
Date
1996-08-22
Report
[1996] 2 SCR 842
Case number
24251
Judges
Lamer, Antonio; La Forest, Gérard V.; L'Heureux-Dubé, Claire; Gonthier, Charles Doherty; McLachlin, Beverley
On appeal from
Quebec
Subjects
Family law
Notes
SCC Case Information: 24251
Decision Content
P. (S.) v. R. (M.), [1996] 2 S.C.R. 842
S.P. Appellant
v.
M.R. Respondent
Indexed as: P. (S.) v. R. (M.)
File No.: 24251.
1995: November 3; 1996: August 22.
Present: Lamer C.J. and La Forest, L’Heureux‑Dubé, Gonthier and McLachlin JJ.
on appeal from the court of appeal for quebec
Family law ‑‑ Compensatory allowance ‑‑ Separation ‑‑ Wife performing administrative and secretarial work for husband’s business while taking care of children ‑‑ Two properties purchased by husband registered in wife’s name ‑‑ Principles to be considered in deciding whether compensatory allowance should be awarded to wife or husband ‑‑ Approach to be taken in considering facts ‑‑ Whether Court of Appeal’s intervention in trial judge’s decision justified.
The parties were married in 1969 under the regime of separation of property. The appellant left her job after the marriage and raised two children. She worked without remuneration in the respondent's first business. In 1971, when that business went bankrupt, the family moved to Antigua. The appellant worked for the respondent’s import/export business from 1974 to 1983, performing administrative and secretarial duties up to five hours a day and at times seven days a week, all without remuneration. When the respondent was away on business trips, the appellant often stayed at home to continue the day‑to‑day operations of the business. She was also responsible for entertaining clients and suppliers. During their marriage, the respondent acquired properties, including one in Antigua and one in Montreal which were registered in the name of the appellant as the sole owner. Proceedings for separation from bed and board were instituted in 1988. Both parties requested a compensatory allowance under art. 462.14 C.C.Q. ‑‑ the appellant for her contributions in services to the enrichment of the respondent’s patrimony, and the respondent for his contribution to the Montreal property. The respondent also instituted proceedings in Antigua for a declaration that he was sole beneficial owner of the Antigua residence. At the time of the Superior Court judgment, the appellant was 56 years old and the respondent was 59. The appellant was not employed but was earning rental income from the Antigua property; her total savings and assets were about $35,000 U.S., in addition to the properties in Montreal and in Antigua. The respondent in his testimony admitted to a net worth of at least $1,525,000 U.S. The trial judge awarded the appellant a compensatory allowance of $150,000 and dismissed the respondent’s claim because art. 462.14 C.C.Q. was not intended to include that which was the object of a deliberate contract between spouses. The trial judge found that the appellant had not yet reached financial autonomy and set the alimentary allowance at $2,625 per month, to be reduced to $1,500 per month after the compensatory allowance had been paid in full. The trial judge did not take into account the rental income which the appellant was receiving from the Antigua property because of the proceedings instituted by the respondent in that jurisdiction, but reserved the respondent’s right to ask for a variation order if that decision were to be rendered in favour of the appellant. After the Superior Court judgment, an Antigua court dismissed the respondent's action and upheld the appellant's ownership of the Antigua property valued at $270,000 in 1989. The Court of Appeal ruled that the Antigua judgment and the appellant's statements in the Antigua proceedings to the effect that the property had been given to her as compensation for her work constituted new evidence justifying its intervention. The Court of Appeal held that the confirmation of the appellant's ownership of the Antigua property constituted payment of the compensatory allowance awarded by the trial judge, and thus restored the amount of the alimentary support at $1,500 per month instead of $2,625. The court also awarded a compensatory allowance of $100, 000 to the respondent for his contribution to the Montreal property, finding that the simple fact of putting this property in the appellant’s name did not reveal any intention by the parties to benefit the appellant with the ownership of this property. This appeal involves the application of the principles set out by this Court in Lacroix and M. (M.E.) to the circumstances of this case.
Held: The appeal should be allowed.
The approach which the courts should take in assessing the constituent elements needed to establish a compensatory allowance must be overall, flexible and generous. Here, the trial judge, to some extent, and the Court of Appeal have failed, at least overtly, to take the overall circumstances into account in determining each of the separate amounts. The Court of Appeal especially appears to have come to a determination of how the parties should fare in the division of property upon separation in a piecemeal fashion.
The trial judge’s mere finding that the parties intended to transfer the property to the appellant was not sufficient justification to refuse to grant a compensatory allowance to the respondent. Where there is an agreement between spouses to transfer property, the court must look to the underlying intention of the spouses to determine whether there is a justification or cause for the transfer of property from one spouse to the other. If the court can find such an intention to benefit the receiving spouse, then the contributing spouse will not have the right to claim a compensatory allowance for his contributions to the enrichment of the other spouse's patrimony. In determining the intention of the parties in transferring property between spouses, the trial judge must examine the lifestyle of the parties during their marriage and the choices they made to arrange their matrimonial relationship. The following considerations are relevant: who was earning money outside the home, who made capital payments to the house and mortgage, who looked after the children, and whether one of the spouses quit a career to focus on home and family responsibilities. The Court of Appeal was justified in intervening in the trial judgment on the basis that the trial judge erred in law in his stated reasons for refusing the respondent’s claim for a compensatory allowance but erred in concluding that he was entitled to such an allowance. The evidence on record indicates that the parties had arranged their finances and divided their responsibilities within the marriage in such a way that putting this property in the appellant's name was intended for her benefit. On a proper examination of all the circumstances of the marriage and of this specific property transaction, the trial judge was correct in refusing to award a compensatory allowance to the respondent.
The Court of Appeal erred in considering that the Antigua judgment declaring the appellant the owner of the Antigua property constituted significant new evidence, and also constituted payment of the compensatory allowance awarded by the trial judge. The fact that the ownership of the Antigua property was being contested before an Antigua court was known to the trial judge. The logical reading of his judgment is that he assessed the amount of compensatory allowance to be awarded the appellant on the understanding that the respondent had given her the Antigua property as partial compensation for the contribution of her services toward his business endeavours. There was sufficient evidence before the trial judge to allow him to come to that conclusion. The appellant's testimony in this regard was not contradicted by the respondent and both parties indicated that the property represented an investment which provided some level of security and independence for the appellant. There was also enough indication in the record, such as the cost and rental income of the Antigua property, to allow the trial judge to make an assessment of the value of that property in the patrimony of the appellant, in order to establish a proper compensatory allowance.
To make a correct assessment of an amount for a compensatory allowance for the appellant, it would be necessary to know the extent of the respondent's patrimony and to know to what extent the contributions of the appellant benefited the respondent. The respondent, however, was vague and uncooperative in his evidence as to the earnings of his company and as to the extent and the nature of his own assets. In light of the uncertainty which this file presented, the trial judge surely made the best assessment he could in determining what compensation should be awarded to the appellant. In reviewing the trial judge's decision, an appellate court must accord a considerable degree of deference to the discretion of the trial judge, and consider what might represent a reasonable range for a compensatory allowance, keeping in mind that any court addressing this question must approach the assessment flexibly, generously, and with regard to the overall situation of the parties. Here, the trial judge did not err egregiously in exercising his discretion in awarding the appellant a compensatory allowance of $150,000. The Court of Appeal therefore was not justified in intervening in the trial judge's decision.
Cases Cited
Applied: M. (M.E.) v. L. (P.), [1992] 1 S.C.R. 183; Lacroix v. Valois, [1990] 2 S.C.R. 1259; Droit de la famille ‑‑ 866, [1990] R.J.Q. 1833.
Statutes and Regulations Cited
Civil Code of Québec [en. S.Q. 1980, c. 39, art. 3; am. 1989, c. 55. s. 8], art. 462.14, 462.15, 462.17.
Civil Code of Québec, S.Q. 1991, c. 64, art. 427, 428, 430.
Authors Cited
Caparros, Ernest. Les régimes matrimoniaux au Québec, 3e éd. Montréal: Wilson & Lafleur, 1985.
APPEAL from a judgment of the Quebec Court of Appeal, [1994] R.D.F. 421 (sub nom. Droit de la famille ‑‑ 1947), allowing in part the respondent’s appeal from a judgment of the Superior Court, [1991] R.D.F. 648. Appeal allowed.
Miriam Grassby and Sylvie Leduc, for the appellant.
Daniel St‑Pierre, for the respondent.
The judgment of the Court was delivered by
Gonthier J. --
I - Introduction
1. This appeal concerns primarily the application of the proper principles in determining whether a compensatory allowance should be awarded in cases of separation or divorce, and what the amount of this compensatory allowance should be. Two recent decisions from this Court, Lacroix v. Valois, [1990] 2 S.C.R. 1259, and M. (M.E.) v. L. (P.), [1992] 1 S.C.R. 183, have set out the principles to be considered in determining the amount of a compensatory allowance to be awarded. This appeal involves applying the principles from those two decisions to the circumstances of the present case.
2. The facts of this case are as follows. The parties were married in 1969 under the regime of separation of property by virtue of a marriage contract. The appellant left her job after the marriage, and raised two children. After the failure of the first business partly owned by the respondent, in which he lost all of his savings, the family moved to Antigua and lived there from 1971 to 1981. The appellant then returned to Montreal with her two children. The respondent, however, despite the family's return to Montreal in 1981, has retained the status of non-resident for tax purposes in this country.
3. The appellant worked without remuneration in the respondent's first business from 1969 to 1971, and again without remuneration in his second business based in Antigua from 1974 to 1983, under the title of "export manager". This was an import/export business which consisted of locating products and suppliers, and arranging for the shipment of these products to clients in the Caribbean. Much of the day-to-day business was managed over the telephone from the parties' home in Antigua, and then in Montreal after 1981. The respondent travelled frequently to locate products and suppliers around the world in order to expand the business's operations. The appellant sometimes accompanied the respondent during these trips, but more often stayed at home, taking and processing telephone orders and arranging for the shipment of products. Until the fall of 1983, the respondent and the appellant were solely responsible for the operations of the business; at that time, the respondent moved the daily operations of his business in with another company located in Montreal, whose services he employed for some of the administrative work of his business.
4. During their marriage, the parties acquired several pieces of property. In Antigua, the respondent acquired three separate properties which were registered in his name, and one property in the name of the appellant in 1981, on which was built a house which now provides rental income. The parties also acquired a property in Montreal at Habitat '67, which they had rented since 1969 and purchased in 1986. This was their common domicile for the years they were living together in Montreal. For these two latter pieces of property, the respondent provided the money for the down payment although the properties were registered in the name of the appellant as the sole owner.
5. Proceedings for separation from bed and board were instituted in 1988. As part of these proceedings, the appellant requested a compensatory allowance under the authority of art. 462.14 of the Civil Code of Québec (now art. 427) for her contributions in services to the enrichment of the patrimony of the respondent. The respondent requested in turn a compensatory allowance for his contribution to the Montreal property which was registered in the name of the appellant. The Superior Court judgment was rendered on October 22, 1991, finding in favour of the appellant, and the respondent appealed this judgment to the Quebec Court of Appeal. In 1988, the respondent had also instituted proceedings in the High Court of Justice of Antigua for a declaration that he was sole beneficial owner of the Antigua residence. Judgment was rendered by the High Court on May 6, 1992, dismissing the respondent's action and upholding the appellant's ownership of the property. The respondent presented the Antigua judgment as new evidence before the Court of Appeal. The Court of Appeal judgment, finding in favour of the respondent, was rendered on June 2, 1994.
6. At the time of the Superior Court judgment, the appellant was 56 years of age, and the respondent was 59 years of age. The respondent in his testimony admitted to owning a bond and equity portfolio as well as some land having a total market value of $1,525,000 U.S. This sum represented his net worth as he had no liabilities. The appellant was not employed but was earning rental income from the Antigua property; her total savings and assets were about $35,000 U.S., in addition to the properties in Montreal and in Antigua.
II - Judgments Below
Superior Court, [1991] R.D.F. 648
7. Boudreault J. first examined the appellant's request for a compensatory allowance based on her contributions to the enrichment of the respondent's patrimony as a result of the help she gave him in the pursuit of his business endeavours. The trial judge expressed great reservations as to the respondent's credibility, and accepted the appellant's testimony wherever it was at variance with that of the respondent. He did not believe the respondent's explanation as to how his assets were accumulated, and found that the appellant was entitled to a compensatory allowance of $150,000 "considering the value of the senior clerk cum executive secretary's services which she supplied to his company during the relevant years and the accruing benefits from that money being judiciously invested by [the respondent] year after year” (p. 651).
8. With respect to the respondent's cross-demand for a compensatory allowance representing the value of his rights in the Montreal common domicile, the trial judge said that the expression "contribution ... to the enrichment of the patrimony" in art. 462.14 C.C.Q. was not intended to include that which was the object of a deliberate contract between spouses. Even though neither party stated that the respondent intended to make a gift to the appellant of the down payment for the Montreal property, Boudreault J. said that "when one voluntarily and deliberately turns over to another $26,000, a contractual situation of some sort must somehow exist" (p. 652). Thus, there was no reason to award the respondent a compensatory allowance for his interest in the Montreal property, which he gave by way of contract to the appellant.
9. With respect to the appellant's request for maintenance and alimentary support, Boudreault J. found that she had not yet reached financial autonomy and that the respondent had the means to support her in a manner similar to their former standard of living. The trial judge set the alimentary allowance at $2,625 per month, to be reduced to $1,500 per month after the compensatory allowance had been paid in full. The trial judge did not take into account the rental income which the appellant was receiving from the Antigua property because of the proceedings instituted by the respondent in that jurisdiction. If that decision were to be ultimately rendered in favour of the appellant, the trial judge expressly reserved the right of the respondent to ask for a variation order to reflect the rental income received by the appellant in her support payments. The trial judge felt that the circumstances in this case indicated that the burden of requesting a variation of the support order should rest with the respondent.
10. And finally, Boudreault J. denied the appellant's request for a lump sum payment, considering the evidence and the fairly large capital which the appellant would receive in the form of a compensatory allowance. He did, however, order the respondent to furnish security in the amount of $50,000 in order to guarantee the payment of the alimentary support.
Court of Appeal, [1994] R.D.F. 421
11. Proulx J.A. refused to interfere in the trial judge's discretion to grant a compensatory allowance to the appellant in the amount of $150,000. However, he ruled that the Antigua judgment which was handed down after the decision of Boudreault J., and the appellant's statements in the Antigua proceedings to the effect that the property had been given to her as compensation for her work, constituted new evidence justifying the intervention of the Court of Appeal. He also held that the confirmation by the Antigua High Court of Justice of the appellant's rights to the Antigua property constituted payment of the compensatory allowance awarded by the trial judge, since the Antigua property, valued at $270,000 in 1989, covered the amount of the compensatory allowance awarded.
12. With respect to the amount of alimentary support awarded by the trial judge, Proulx J.A. held that there was no reason to interfere with the amount awarded, and restored the amount at $1,500 per month instead of $2,625 per month, considering that the payment of the compensatory allowance had been satisfied in full by the Antigua judgment confirming the appellant's ownership of the Antigua property. Proulx J.A. ordered the retroactive reimbursement of the overpayment of support for the previous two years, from the time of the Antigua judgment to the date of the Court of Appeal judgment. Proulx J.A. did not make reference to the rental income which the appellant was receiving from the Antigua property.
13. And finally, Proulx J.A. was of the view that the trial judge erred in refusing to award a compensatory allowance to the respondent for the contribution he made toward the Montreal property. The simple fact of putting this property in the name of the appellant did not reveal any intention by the parties to benefit the appellant with the ownership of this property, and the respondent should be compensated for his contribution. Since he made a down payment equal to about 50 percent of the purchase price of the property, he should be entitled to a similar proportion of the present value of the same property. Therefore, Proulx J.A. held that the respondent was entitled to a compensatory allowance of $100,000 to be paid by the appellant.
14. On this last point, McCarthy J.A. wrote a brief concurring opinion indicating that this Court's decision in M. (M.E.), supra, which was handed down after the trial judgment in the case at bar, mandated a trial judge to examine the intention of the parties in determining whether putting a particular property in the name of one spouse was meant to benefit that spouse with the ownership of the property. If this is done solely with the intention of putting the property beyond the reach of the creditors of the spouse who paid for the property, then the contributing spouse has the right to claim a compensatory allowance for his contribution toward the property. McCarthy J.A. agreed with Proulx J.A. that the evidence in this case indicated that such a compensatory allowance should be awarded to the respondent for his contribution to the purchase price of the Montreal property.
III - Issues
15. The central issues on this appeal are, firstly, whether the Court of Appeal erred in finding that the confirmation by the Antigua High Court of Justice of the appellant's ownership of the Antigua property constituted payment of the compensatory allowance of $150,000 to the appellant and, secondly, whether the Court of Appeal erred in awarding a compensatory allowance to the respondent for his contributions to the Montreal property which was registered in the name of the appellant. Both issues will necessitate a review of the principles set out by this Court in previous cases with respect to the awarding of compensatory allowances.
16. The specific legal issues which this appeal raises are, firstly, whether the judgment rendered by the Antigua High Court of Justice constituted "new evidence" sufficient to justify the intervention of the Court of Appeal in the judgment of Boudreault J. of the Superior Court. Secondly, did Boudreault J. err in his treatment of the Montreal property, especially in light of this Court's judgment in M. (M.E.), supra, and was the Court of Appeal justified in awarding the respondent a compensatory allowance for his contributions to the appellant's patrimony with respect to this property? And thirdly, if the Court of Appeal were justified in intervening in the judgment of Boudreault J. on these grounds, did the Court of Appeal commit any error in correcting only discrete parts of the award of Boudreault J., without apparent consideration for the overall picture and the overall circumstances of both parties? This appeal is largely concerned with the approach an appellate court, or for that matter a superior court, must take when assessing these issues involving distribution of property between spouses within proceedings of separation and divorce.
IV - Law
17. The first paragraph of art. 462.14 C.C.Q. (now art. 427) provides for the payment of a compensatory allowance from one spouse to the other in the following circumstances:
462.14 The court, in declaring separation from bed and board, divorce or [nullity] of marriage, may order either spouse to pay to the other, as compensation for the latter's contribution, in property or services, to the enrichment of the patrimony of the former, an allowance payable [in cash] or by instalments, taking into account, in particular, the advantages of the matrimonial regime and of the marriage contract. The same rule applies in case of death; in such case, the advantages of the succession to the surviving spouse are also taken into account.
18. In Lacroix, supra, I pointed out some of the weaknesses inherent in the regime of separation of property, and the injustices which this regime has often visited on one spouse, usually the wife, who has benefited the other spouse throughout the marriage with contributions of money and unpaid services which have served to enrich the patrimony of the receiving spouse to the detriment of the contributing spouse. At p. 1283 of that decision, I said the following:
At first sight, the purpose of the compensatory allowance is to restore the equilibrium between two patrimonies which has been unfairly disrupted by developments in the matrimonial relationship. If one of the spouses has been enriched at the conclusion of the matrimonial relationship by the contribution of the other spouse, the judge will order compensation to the extent that the enrichment was due to the contribution.
19. The legislature introduced the remedy of compensatory allowance on December 1, 1982, as a remedy available to the courts to mitigate the losses suffered by the spouse who contributed goods and services throughout the marriage, by compensating that spouse for these contributions. This mechanism is directed towards redressing a disequilibrium which may have resulted between the parties within the matrimonial relationship. This legislative intervention in 1982 was not, however, meant to create a mandatory family patrimony; the legislature maintained the right of spouses to choose their own matrimonial regime through a matrimonial agreement. Thus, the question faced by courts is how to give effect to the remedy introduced by the legislature which justifies a considerable intervention by the courts in the division of property between spouses who are parties to a matrimonial agreement, and yet respect the freedom of choice of the parties as evidenced by such an agreement.
Elements Necessary to Establish a Compensatory Allowance
20. In M. (M.E.), supra, this Court again addressed the law relating to compensatory allowances, this time referring more explicitly to the circumstances in which the awarding of a compensatory allowance is justified. This Court adopted the following passage from Professor Caparros as an appropriate statement of the law regarding the criteria needed to establish an award for a compensatory allowance under the terms of art. 462.14 C.C.Q.:
[translation] Accordingly, to succeed in a claim for a compensatory allowance it is necessary to establish an impoverishment of the claimant which has resulted in an enrichment of the defendant, and an absence of cause for that enrichment. If the absence of cause is not taken into account, arbitrary action may result. Once there is an impoverishment, enrichment and causal link, even if the enrichment is justified, there may be a tendency to take away property from someone who is validly enriched. Let us not forget that the great underlying principle is that each person should be given his due, not have it taken away.
(Ernest Caparros, Les régimes matrimoniaux au Québec (3rd ed. 1985), at p. 61.)
21. The doctrine of compensatory allowance is related to the doctrine of unjust enrichment, and the criteria needed to establish a cause of action in both cases are very similar. In M. (M.E.), supra, at p. 204, I set out the following constituent elements required to establish an award of a compensatory allowance:
(1) the contribution, whatever its nature and form;
(2) the enrichment;
(3) the causal link, which must be "adequate", but does not have to be absolute;
(4) the proportion in which the contribution has made possible the enrichment;
(5) the concomitant impoverishment of the person making the contribution;
(6) the absence of justification for the enrichment.
22. In M. (M.E.), supra, this Court also made more specific comments regarding two of the above elements. In keeping with the overall, flexible and generous approach which this Court has held is the proper approach in assessing these elements, all contributions to the marriage by both spouses are to be considered and weighed in a preliminary assessment, without making a distinction between contributions to the marriage and contributions to the patrimony. I state at p. 197:
So-called "domestic" or "conjugal" contributions must not be excluded a priori because of their nature, but should be part of the overall assessment of the matrimonial situation.
23. Disregarding a spouse's contributions to the marriage may lead to a distorted view of the overall situation of the marriage and the understanding of the spouses as to the arrangements to be made within the marriage. Further on, at p. 198, I continue:
Further, failure to look at the "contributions towards the expenses of the marriage" and assess them may lead to unfair results in a compensatory allowance situation. Since the wife's contribution to the home is more fluid, less capable of being strictly proved, it is easy to regard it in its entirety as a contribution to the marriage and exclude it from the analysis. It is less easy to exclude the husband's contribution, as it is often monetary and lends itself to allocation depending on his employment.
24. I recognize that normal contributions to the marriage may certainly enrich the patrimony of the other spouse. I also recognize that a spouse making a normal contribution to the marriage and to family life cannot be expected to be compensated to the extent of the whole value of that contribution. In M. (M.E.), supra, I suggested that in keeping with a global approach which the courts must take in assessing spouses' contributions to the marriage, it would be appropriate to consider normal contributions to the marriage at the stage of assessing the overall contributions made by both spouses, and to acknowledge at a later stage that the marital relationship itself may justify the fact that normal contributions were made by both spouses, leaving the court to determine whether contributions other than normal contributions merited a compensatory allowance.
25. Also, one must consider whether contracts and agreements concluded between the parties before or during the course of the marriage are a cause or justification for the enrichment of one of the spouses with the result that this enrichment should not give rise to a compensatory allowance. A spouse may, by sale or by gift, transfer the ownership of property in the name of the other spouse. This transfer of property may be intended as payment of compensation for contributions made by the receiving spouse, and to discharge part of any potential claim for compensatory allowance made under art. 462.14. This possibility has been provided for by art. 462.17 C.C.Q. (now art. 430), which states:
462.17 One of the spouses may, during the marriage, agree with the other spouse to make partial payment of the compensatory allowance. The payment received shall be deducted when the time comes to fix the value of the compensatory allowance.
26. Alternatively, the spouses may have intended that the spouse receive the benefit of the ownership of the property for some other reasons, for example, to provide the receiving spouse with a patrimony. The court must look to the underlying intention of the spouses to determine whether there is a justification or cause for the transfer of property from one spouse to the other. If the court can find such an intention to benefit the receiving spouse, then the contributing spouse will not have the right to claim a compensatory allowance for his contributions to the enrichment of the other spouse's patrimony.
Approach to Be Taken by Courts
27. This Court has repeated both in Lacroix, supra, and M. (M.E.), supra, that the approach which the courts must take in assessing all the constituent elements needed to establish a compensatory allowance must be overall, flexible and generous. In Lacroix, for example, this Court stated at p. 1278 that, in general, "analysis of the factual and legal aspects of a compensatory allowance situation calls for special flexibility". This is true for all aspects of the analysis which a trial judge must bring to bear on the circumstances and the situation between the parties. The party requesting a compensatory allowance is allowed to adduce evidence by any means to prove the contribution to the enrichment of the other spouse's patrimony, as provided for by art. 462.15 C.C.Q. (now art. 428); the causal link between the enrichment of the benefiting spouse and the contribution made by the spouse requesting the compensatory allowance need not be demonstrated as strictly as in other areas of civil liability; the burden of proof imposed on the requesting spouse with respect to each of these elements should not be applied so rigidly as to deny in effect to the contributing spouse the beneficial effects of the remedy. Flexibility is needed because of the special nature of the matrimonial context: we cannot view marriage in the same way as a business and expect that detailed accounts of contributions, gains and losses have been recorded. We must keep in mind the ideal of marriage as a peaceful union, as a partnership aimed at benefiting both spouses and in which the contributions of both spouses combine to mutual benefit.
28. In addition, any assessment of the contributions made and the losses sustained within a marriage cannot be done in a piecemeal fashion. The circumstances of the marriage must be viewed as a whole, and an overall assessment must be made to determine whether a compensatory allowance should be paid to a spouse whose holdings coming out of the marriage do not reflect the contributions made by that spouse during the marriage for the mutual benefit of the spouses. It would be mistaken for the court to treat properties held by either or by both spouses as distinct entities and to determine an amount in the nature of a compensatory allowance for each property, without regard for contributions made otherwise in the marriage or with respect to other property. Similarly, in determining the final division of property between spouses, it would be mistaken for a court to assess discretely and individually amounts relating to the property division between spouses, compensatory allowance, lump sum payments, or alimentary support payments. These amounts must be assessed in relation to the overall circumstances between the parties.
29. In the case at bar, we can reproach both the trial judge, to some extent, and the Court of Appeal for having failed, at least overtly, to take the overall circumstances into account in determining each of the separate amounts. With respect, the Court of Appeal especially appears to have come to a determination of how the parties should fare in the division of property upon separation in a very piecemeal fashion. Treating the decision of the trial judge as a starting point, it considered the compensatory allowance to be paid to the appellant as satisfied by the Antigua judgment confirming her ownership of the Antigua property, and it ordered the payment of a compensatory allowance to the respondent with respect to the Montreal property, maintaining the alimentary support payments to the appellant in the same amount as ordered by the trial judge, without apparent regard for the fact that it effectively reduced the appellant's equity by an amount greater than $250,000 compared to what the trial judge had provided.
Deference to Trial Judge's Exercise of Discretion
30. Article 462.14 C.C.Q. states that the court may order a spouse to pay a compensatory allowance to his or her spouse if certain conditions, as discussed above, are met. The court has ultimate discretion to determine whether, in the circumstances of the case, a compensatory allowance is warranted and the assessment of these circumstances is the prerogative of the trial judge. The Court of Appeal should refrain from intervening in this assessment short of an error of law or evidence of an egregious error of fact in the trial judge's exercise of discretion, under art. 462.14.
31. In Lacroix, supra, I pointed out that the awarding of a compensatory allowance depends to a large extent on the ability of the trial judge to assess the facts and the evidence. With respect to the scope of intervention which is appropriate by an appellate court, I said the following, at p. 1275:
In performing this difficult judicial exercise, there are many factors which the trial judge may legitimately consider as, in relation to both compensatory allowances and lump sums, the legislator has recognized the need for broad discretion by adopting enabling provisions which have an essentially open texture. In such a context, the function of an appellate court is to correct errors of law made at trial in exercising the discretion conferred by law. It goes without saying that assessing the facts is the prerogative of the trial judge and that, unless it can identify such an egregious error in this regard that it indicates an error of legal principle, the Court of Appeal is not justified in intervening.
32. As well, in M. (M.E.), supra, I reiterated that a Court of Appeal must exercise a relatively large degree of deference to the discretionary power of the trial judge for two reasons. Firstly, when a family is in the process of dissolving, its financial matters must be dealt with promptly so as to avoid exhausting the parties' resources and so as to permit them to start their lives over again. And secondly, spouses generally do not keep detailed records concerning their family finances, and oral testimony is therefore of great importance. The trial judge is in the best position to assess the demeanour and credibility of the witnesses. As indicated above, there are a number of factors which a trial judge may legitimately consider in assessing the appropriateness and the amount of a compensatory allowance. In M. (M.E.), supra, at p. 205, this Court said the following with respect to the deference to be accorded by an appellate court:
This latitude in assessing "factors which the trial judge may legitimately consider" will occur in particular in the examining of the reasons justifying the enrichment, which may well be done from an overall perspective and will often underlie the judge's decision whether or not to use his discretionary power to alter the parties' patrimonial situation resulting from their agreements or from the circumstances.
The fact of giving greater deference to the trial judge's decision may, at least prima facie, lead to "contradictory decisions". This difficulty is inherent in the subject-matter, but it is the result of a flexible system in which the judge exercises an equitable power. Article 559 C.C.Q. (and its successor, art. 462.14 C.C.Q. [now art. 427]) is just such an equitable provision, which clearly confers a remedial and discretionary power on the trial judge.
33. And in the conclusion of that case, the Court decided that the trial judge had exercised his discretion judicially, saying at p. 206:
In the case at bar, the record contained evidence which justified the trial judge in exercising his discretion to deny the compensatory allowance to the respondent. The Court does not have to decide whether it would have exercised its discretion in the same way. Questioning a trial judge's findings of fact where there has been no error of law can only encourage appeals, a particularly unfortunate development in family matters. The Court must instead inquire whether the trial judge exercised his discretion judicially.
34. In the present appeal, as in Lacroix, supra, and M. (M.E.), supra, the appellant is challenging the intervention of the Court of Appeal in a determination made by the trial judge as to the appropriate amount of compensatory allowance which should be awarded the appellant. Absent an error of law or an egregious error of fact on the part of the trial judge, the Court of Appeal should not intervene in this determination.
V - Application to the