This Month in NS Family Law – June 2021

July 5, 2021

Colucci v. Colucci, 2021 SCC 24
Martin J., Wagner C.J. and Abella, Moldaver, Karakatsanis, Côté, Brown, Rowe and Kasirer JJ. Concurring

Issues: Retroactive child support | Rescinding child support arrears

This Supreme Court of Canada decision created a new approach to retroactive child support and arrears.

The parties had a nine-year marriage. The mother has custody of their two children. The father was to pay $920 per month for child support based on the parties’ Consent Order. The Order was issued one year before the Child Support Guidelines became law. From 1998 to 2012, the father made no voluntary child support payments. He later brought an application to retroactively decrease his child support payments.

To assess whether child support should be retroactively varied under the Divorce Act, the court provided the following framework:

  1. The applicant must show a past change in circumstances, usually a change in the payor parent’s income;
  2. There is a presumption that the retroactive date is the date when the other parent was informed of the change in circumstances. Generally, the retroactive date can be up to three years prior to the other parent learning of an application to vary child support;
  3. If the other parent was not informed of the change, the retroactive date is the date that they were formally informed of an application to vary child support;
  4. If it is unfair to use the presumed retroactive date, the court may choose to apply a different retroactive date. When determining the appropriate retroactive date, the four D.B.S. factors are considered. They include:

1. Whether the applicant has an understandable reason for the delay in giving effective notice or making an application to the court?
2. Conduct of the payor parent;
3. Past and present circumstances of the child;
4. Hardship to the payor parent if a different retroactive date is used.

  1. If the court determines that a retroactive adjustment is appropriate and a retroactive date is determined, the retroactive amount is determined by referring to the Child Support Guidelines.

In this case, the court accepted that the Child Support Guidelines coming into force was a change in circumstances. However, the court declined to retroactively decrease the father’s child support payments based on his failure to provide updated income information and his unwillingness to make voluntary child support payments.

With respect to the arrears, the court noted that child support arrears are rarely rescinded. Courts will first consider any available options such as payment plans or the temporary suspension of payments. For an Applicant to have child support arrears rescinded, they must show that they cannot and will not ever be able to pay their arrears. In this case, the father did not bring sufficient evidence and his child support arrears remained at $170,000.

Pelham v. MacNeil, 2021 NSSC 190
Justice Elizabeth Jollimore

Issue: Income for child support | Payment of arrears 

The issues in this case involved the determination of income for child support, and terms of payment of retroactive child support.

The parties were in a common-law relationship and had one child together. Ms. MacNeil asked for Mr. Pelham’s 2018 income of $165,379 used to calculate prospective child support. Mr. Pelham sought a determination that his income for child support was $41,482, on the basis of the portion of the severance package he received for 2021.

The Court found that Mr. Pelham made insufficient efforts to find employment after being informed of his former company’s shut down, and imputed Pelham’s income in the amount of $65,000. This reflected the salaries of the positions he applied for and the amount he previously earned with minimal experience.

The court set Mr. Pelham’s retroactive child support at $22,530.96. and reduced it by Mr. Pelham’s overpayments in 2021, for a total of $15,395.96. In response to Mr. Pelham’s argument that he could not pay this amount, the Court considered the $24,000 contribution that he made to his RRSPs in 2020, and ordered that Mr. Pelham pay his child support arrears with his RRSPs within 30 days.

Ward v. Murphy, 2021 NSSC 2017
Justice Lee Anne MacLeod-Archer

Issue: Costs

This is a decision on costs following Mr. Ward’s Application to vary child support. Ms. Murphy was represented by counsel and Mr. Ward was self-represented. Ms. Murphy claimed costs in the amount of $27,313. Mr. Ward disputed her claim on the basis that he was the more successful party. The Court noted that Ward was mildly successful, since his child support payments were slightly reduced. However, the reduction was not proportionate to the costs and time spent litigating the issue. Ms. Murphy was successful on two minor issues, and neither party was successful on a fourth issue.

Mr. Ward had problematic conduct throughout the hearing. He argued with rulings, delayed filing documents and advanced irrelevant arguments. However, he had already been penalized for this, by being prohibited from bringing future Applications without first receiving permission from the Court.

To determine costs, the Court applied Tariff 1 because this was not a complex matter, and Mr. Ward had some success. In total, Ward was ordered to pay $20,688 in costs for a six-day hearing.

Bezanson v. Bezanson, 2021 NSSC 126
Justice C. LouAnn Chiasson

Issue: Financial disclosure

The wife sought financial disclosure of corporate tax returns and t-slips for the three corporate entities listed in the husband’s Statement of Property. The Court acknowledged that full disclosure is the foundation of family law and that disclosure should be more liberal at the pre-trial stage than at the trial stage. When determining whether to order disclosure, the Court considers factors such as: connection; proximity; discoverability; reliability; proportionality, alternative measures; privacy, balancing, objectivity and limits.

The first step is to determine the relevance of the documents being requested. In this case the wife requested: disclosure of the T4’s for any salary payments made to relatives of the husband by the companies; and disclosure of the companies’ income tax returns and financial statements. The Court decided that the request for all T4’s for relatives of the husband was too broad. The request would have been better tailored to the husband’s immediate family and positions that were relatable to the husband’s. The request for the companies’ financial information was considered relevant. The husband was named as a principal of the companies in the shareholder’s agreements and the husband received significant funds from the companies’ director’s accounts.

The Court found that the husband had not proved that the disclosure of the companies’ financial information was irrelevant. Part of his income is composed of funds transferred from the companies, he is a minority shareholder and is a principal in the companies. Furthermore, all of the companies are family owned, the information should be easily accessible and there is an implied undertaking that the information will only be used for the proceeding. The husband was ordered to produce the corporate entities’ income tax returns and financial statements for the three previous years.

If you have any specific questions regarding this month’s case summaries or if you require legal services, a member of our team would be happy to assist you.

 

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