This case is an excellent demonstration of where the law currently sits with respect to child support and spousal support, as it sums up the case law in Ontario to date on these issues.
The parties in this case lived together as common law partners for seven years before deciding to end their relationship. They had only one child throughout their relationship. When the child was born, the parties agreed that the Applicant mother would stay at home with the child until he was old enough to go to school. Since the parties’ separation, the mother has earned little income, approximately $10,780.00 as a part-time crafts teacher, and has earned some additional monies through social assistance. The Respondent father, on the other hand, has been employed as a truck driver with the same company for the past six years. In 2007, the father earned an income of $56,278.00, but due to a reduction of his hours resulting from government regulation in the industry the following year, he earned only $30,000.00 in 2008. The mother, in her Application, claimed child and spousal support from the father based on his 2007 income. In the alternative, the mother argued that the father’s income should be averaged over the past two years in light of the significant decline in his income, which she claimed was a result of the father’s intentional under-employment. The father, in his responding material, argued that his income should be set at $30,000.00, that he did not have the ability to pay spousal support, and that in the event he was made to pay spousal support by the court, an income of $30,000.00 should be imputed to the mother based on the fact that she has the potential to earn this amount, but has intentionally chosen not to.
The court in this case essentially had four significant issues to contend with:
- What was the father’s income for support purposes?
- Should income be imputed to either party?
- Is the mother entitled to spousal support?
- If the mother is entitled to spousal support, what is the quantum and duration of such support that the father is required to pay?
With respect to the first issue, the court out rightly rejects both the mother’s arguments. According to the court’s contextual interpretation of the Child Support Guidelines, in cases where the payor’s income in the current taxation year has changed significantly from what they last claimed it to be in their prior year’s tax return, in most circumstances, the payor’s current income will be used to determine the amount of support payable by that individual. The court stresses that the Guidelines could have very well described annual income as being income as stated in one’s previous year’s tax return, but instead deliberately chose not to. This, the court feels, is a good indication that the payor’s current income is to be used. According to the court, one’s past income should only be relied on as a substitute for one’s current income where one’s current income is tenuous and uncertain. Moreover, the averaging approach referred to by the mother in this particular case was rejected by the court, as the judge determined that the father’s historical income was not likely to be an accurate predictor of his future income stream. In other words, support should be based on one’s probable future income, not that person’s historical income. If it is clear to the court that one’s future income will be unlike their past income, then the court should use that individual’s future income stream to arrive at an accurate and fair support calculation. In the case at bar, the court accepted the father’s arguments that his income had changed from previous years, and that the decline in his income resulted from a host of factors that were beyond his control. The father was confident that his hours would be increased in the near future, although not to the same extent as in the past. Given this information, the judge felt that the most reasonable and fair approach would be to fix the father’s 2008 income at $35,000.00 and his 2009 income at $40,000.00 for support purposes.
With respect to the second issue, the court states that where an individual makes an argument that income should be imputed to the other party, he or she must meet the arduous onus of establishing that that individual was intentionally under-employed, and furthermore, there must be an evidentiary basis upon which the finding can be made. In the case at bar, the court was satisfied that neither party met this onus. In the court’s view, the father was doing his very best to make a living in an industry that had recently been regulated by the government, and likewise, the mother was really attempting to secure her economic future by training and planning for future job opportunities. The court further notes how difficult the parties’ separation had been on the mother financially, given that she was economically reliant on the father during their relationship, and was now forced to rely on social assistance. The court accepts that after the parties’ separation, the mother had struggled tremendously in trying to find stable employment, but was nevertheless unsuccessful.
The court had no difficulty coming to its conclusion on the third issue. The mother was without doubt entitled to spousal support both on a compensatory and non-compensatory basis. The parties had agreed during their relationship that the mother would stay at home to raise the children while the father worked to financially support the family. There was no doubt in the judge’s mind that this arrangement inevitably disadvantaged the mother financially and had resulted in her current inability to find stable employment. The judge determined that the mother required spousal support in order to ease her current financial burden.
After determining the wife’s positive entitlement for spousal support, the court then turned to the issue of quantum and duration. In canvassing this issue, the court relied heavily on the Court of Appeal’s decision in Fisher v. Fisher, and ultimately concluded that once entitlement to support is determined in the affirmative, a court should then look to the Spousal Support Advisory Guidelines (even though they are ultimately only advisory) to determine the reasonable and equitable quantum and duration of support that is required to be made by a payor spouse. The judge ultimately decided that in this particular case, using the Spousal Support Advisory Guideline “with child” formula achieved the fairest outcome. Setting the father’s income at $35,000.00, the Guideline range for spousal support was determined to be between $1 per month to $229 per month. The judge fixed spousal support in this case at the highest end of the spectrum, as this arrangement would provide the mother and child with 51.3% of the family’s net disposable income.
In terms of the durational range for support, the Guidelines indicated that in this case, the father would be required to financially support the mother for between 3 to 16 years. The judge in this particular case, however, did not fix a time limit for spousal support to be paid, given that both the mother and father’s financial situation would likely improve in near future. The judge, instead, cautioned that financial changes in circumstances would merit a future review on the amount of support. The judge, however, did not fix a date for such review, but instead, determined that the parties would be best left to contend on their own with such material changes by bringing a variation application to alter support.