Child support update.
What are the Guidelines? The Guidelines are laws which set out how much child support parents must pay. The purpose of the Guidelines is to establish a fair standard of support for all children, on the premise that all children are entitled to child support, and all parents have obligations to pay child support, based on their income(s) and the care arrangements for their children. The term "Guidelines" is misleading, however, in that it implies that the law is only a guide to how much should be paid. This is incorrect. The Guidelines set out the basic amount of support payable at set income levels, up to income of $150,000, beyond which different rules apply. The Guidelines set out rules for calculating each parent's proportionate share of "special and extraordinary expenses", in addition to the base amount of support. In addition, the Guidelines set rules for calculating income in unusual cases, and address situations where children reside with both parents some of the time, and/or not all children in the family reside with one parent.
As a potential litigant, the first question to ask is whether the Federal Child Support Guidelines apply to you. Although the federal and provincial/territorial governments share legislative responsibility for child support, the federal government has sole responsibility for divorce laws. If you are planning to divorce, or are already divorced, then the Guidelines apply, unless you have an agreement or court order dated prior to May 1, 1997. If you have never been married, or if you are separated or planning to separate, or if you are married and separated but have not commenced divorce proceedings, then provincial laws apply.
This does not mean that you do not have to follow the Guidelines, however. Most provinces have now adopted the Federal Child Support Guidelines and apply them in all child support cases, regardless of the marital status of the parents. The courts consistently say in child support matters that there is no reason to treat the children of married parents differently than the children of unmarried parents.
Note, however, that the Guidelines do not automatically change agreements or court orders made before May 1, 1997. If you have such an agreement or order, you may have to make a court application to vary child support.
The next thing to consider is whether you must make a court application to set or vary child support. While many people consult lawyers when they have questions about child support, there is no need to go to court in every case. Child support is determined on the basis of the total income, province of residence, the number of children, and their residential care arrangements. The Guidelines provide tables which can be used to calculate the basic child support obligation. To determine the basic child support obligation, you need to look at:
* the province or territory where the paying parent lives;
* the paying parent's total income from his/her tax return; and
* the number of children (of the payor and recipient) who are entitled to support.
It is then relatively simple to calculate the basic child support obligation using the relevant table for the payor's province of residence, the payor's total income and the appropriate column for the number of children. Generally speaking, the parent who provides residential care of the child(ren) will be the recipient of child support from the other parent. Since the law clearly requires the "non-residential care parent" to pay the basic amount of child support, most parties do not need to have the court determine the basic child support amount.
In fact, most parties should not come to court since the court process should be a last resort, used only when a third party adjudication is required for a substantive legal or procedural issue. Fair-minded lawyers will always advise parties to meet their basic obligations without going to court, or at best, with minimal use of court resources, for example, to obtain the signature of a judge on a consent order.
Do you need a court order? Not necessarily, except as a final order in divorce cases. Many parents agree on child support without going to court, using the tables or making reasonable arrangements otherwise, depending on their circumstances. In all cases, child support has to be paid, regardless of court involvement. Once the courts are involved, however, judges are required to apply the law and order the appropriate amount of support according to the Guidelines.
Experienced lawyers will advise that whether or not to obtain an order is a judgment call, depending on the relationship of the parties, their ability to communicate, and the level of trust between them, since the legal obligation to pay child support exists whether or not a court has ordered it to be paid. Aside from needing a judge to decide on a point of law, or the application of the law to the facts in a case, the main reason for having a court order--any court order--is to facilitate enforcement of the order.
All child support orders include a mandatory clause requiring a copy of the order to be sent to the provincial director of maintenance enforcement, who then collects the child support payment from the payor and disburses it to the recipient. While parties can opt out of this system--and this is the recipient's choice, not the payor's choice--if child support is not paid according to the terms of a court order, then enforcement proceedings may be taken against the non-payor. Garnishee proceedings may be commenced against the debtor, among other legal proceedings, and in some provinces, including Alberta, provincial services such as motor vehicle registration and licensing may be suspended, and/or the debtor's name will be published on a dead-beat parents' list of debtors. If you are a recipient and you have opted out of the maintenance enforcement system, you can always opt in again by filing a notice of arrears if the payor stops paying child support or is otherwise in arrears.
What types of cases do go to court? Most cases simply involve calculating the base amount of child support according to the payor's total income, province of residence and the number of children, as well as figuring out the proportionate share of special and/or extraordinary expenses--called "Section 7 expenses"--for each parent. Section 7 of the Guidelines allows the court to order child support for some or all of the expenses for the following:
* child care expenses incurred as a result of the recipient's employment, illness, disability, or education or training for employment;
* that portion of medical and dental insurance premiums attributable to the child;
* health-related expenses that exceed insurance re-imbursement by at least $100 annually (for orthodontic treatment, professional counselling by a psychologist, psychiatrist, or social worker, physical/ speech/occupational therapy, prescription drugs, eyeglasses and contact lenses, and hearing aids);
* extraordinary expenses for primary or secondary school education or for any other educational programs that meet the child's particular needs;
* expenses for post-secondary education;
* extraordinary expenses for extracurricular activities.
It is worth noting that a common misperception is that only the income of the payor is relevant in child support cases. This is true if there are no section 7 expenses to be considered, but if there are expenses in this category, then the recipient's income is also considered. In these cases, both parents must disclose income and expenses pursuant to disclosure rules in each province/territory. In Alberta, the Rules of Court provide a list of items to be disclosed by one or both parties, depending on the circumstances. Thereafter, each parent may be required to pay a proportionate share of the expenses, taking into account the necessity of the expense in relation to the child's best interests and the reasonableness of the expense in relation to the means of the parents and to the parents' spending patterns prior to the breakdown of the relationship, although this is in the court's discretion.
It's fair to say this is where many cases become complicated. While it is not uncommon for a payor to object to expenses for school or extracurricular activities, the Guidelines define extraordinary expenses for school or extracurricular activities as expenses that exceed those that the parent requesting the amount can reasonably cover, or those that are extraordinary taking into account the amount of the expense in relation to the income of the person making the request, the nature and number of educational programs and extracurricular activities, the special needs or talents of the child(ren), the overall cost of the programs and activities, and any other relevant factors. Many conflicts arise in this grey area of the law and to date the best advice from family law lawyers seems to be that if an expense is reasonable and in the best interests of the children, the courts will favour inclusion, particularly when the activity was already established or planned for the child prior to the separation. However, as a section 7 expense, both parents may be required to share a portion of the cost.
Another common area of dispute includes those cases:
* where the payor has not filed income tax returns and cannot substantiate a claim to income at a certain level;
* where the payor's income fluctuates from year to year due to commission sales or bonuses or other irregular pay structures;
* where one or both parties has re-married or otherwise entered into a new relationship and there are questions about overall household income and/or expenses.
In terms of the payor's income, the Guidelines clearly state that the base amount of child support is based on the payor's annual income. This is usually determined using the sources of income set out under the heading "Total Income" in the T1 General Form issued by the Canada Revenue Agency. However, if the court determines that this is not the fairest determination of that income, then the court may consider the payor's income over the last three years. It determines an amount that it considers fair and reasonable in light of any pattern of income, fluctuation of income, and/or receipt of a non-recurring amount of income/loss during those years. In these cases, the court may impute an average income over the three years for child support purposes.
Other circumstances which may lead the court to impute income include cases where the payor:
* is intentionally under-employed or unemployed;
* is exempt from paying income tax;
* lives in a country with significantly lower tax rates than Canada;
* appears to have diverted income, failed to provide income information or unreasonably deducted expenses;
* has significant income from trusts or dividends or capital gains that is exempt or taxed at a lower rate.
In cases where the payor has a second family, the court may enquire into whether or not the Guidelines, in combination with other circumstances, create undue hardship for either the payor or the children. Parents cannot reduce their obligations to their first families unless a comparison of both households shows that the second household would have a lower standard of living if the support payments were not reduced. In comparing household incomes to determine hardship the court may look at the income of all household members--not just the payor and recipient--and may also look at the number of people in each household. A cautionary note, however, is that proving hardship is difficult and decisions reducing support for this reason are rare.
In all of these cases, there is, of course, much room for debate and much on-going conflict. However, it is clear that the Guidelines have done much to establish a fairer system of determining child support than in the past.
In the next issue of LAWNOW, I will focus on contentious areas of child support such as split/shared custody, retroactive support, and support for university-age children.
Michelle C. Christopher is a lawyer with the Youth Criminal Defence Office in Calgary, Alberta.
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|Author:||Christopher, Michelle C.|
|Date:||May 1, 2008|
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