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    • Tag: Spousal Support

    Child and spousal support obligations take effect either pursuant to a court order or a separation agreement.

    Changing Child Support or Spousal Support Payments During COVID-19

    Child and spousal support obligations take effect either pursuant to a court order or a separation agreement (to be sure, many people make informal arrangements amongst themselves, though this is rarely advisable). Separation agreements typically contain review clauses which outline the process for changing a payor’s child or spousal support obligations, along with what kind of change in circumstances will trigger the review. Parties who have signed a separation agreement addressing support should begin there when seeking to vary a support obligation.

    In Ontario, support orders are made either pursuant to the Divorce Act or the Family Law Act, depending on the court in which the proceedings took place. Sections 17(4) and 17(4.1) the Divorce Act and sections 37(2) and 37(2.1) of the Family Law Act outline the tests for varying child support and spousal support slightly differently. In practice, however, we are generally concerned with whether a “material change in circumstances” has taken place since the order was made. A “material change” is interpreted as a change, which if known at the time of the order, would have resulted in a different order being made.

    The loss of employment (or even a reduction of income) beyond the payor’s control would generally justify a variation of child and/or spousal support in ordinary times. To date, there is no reason to believe that the loss of employment or income resulting from the pandemic would be any different.

    That said, support payors should be careful in navigating a reduction of support. At all times, they should make good faith efforts to be transparent and continue paying what is affordable to them. For example, if a support payor underwent a 40% loss of income as a result of COVID-19, a good faith effort would be to negotiate a roughly 40% reduction to their current support obligations. Practically speaking, however, this may not necessarily be feasible. The support payor’s remaining monthly expenses (such as rent/mortgage, utilities, car insurance, debt payments, etc.) have not automatically dropped by 40% as well.

    It will be important for the support payor to alleviate their losses as much as possible, for example, by applying for emergency relief from the government where appropriate, deferring debt payments and insurance premiums where possible and looking for other employment in the meantime.

    When the courts resume regular function, many of these support payors will need to begin court proceedings to formally vary their support obligations or any arrears that accrue over the ensuing months. A payor’s good (or bad) faith efforts to continue paying support will likely be a factor considered by the court when addressing the issue.

    For more information about child support or any other family law related issue, please contact the author of this blog post, Mason Morningstar at mason.morningstar@devrylaw.caor 416-446-3336.

     

    “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

    By Fauzan SiddiquiBlog, COVID-19, Family Law
    How is COVID-19 affecting child and spousal support in Ontario

    How is COVID-19 affecting child and spousal support in Ontario?

    The coronavirus pandemic has brought far-reaching economic shock waves across the country. Over one million jobs have been lost in Canada due to COVID-19 in the month of March alone. As this crisis continues and more jobs and businesses evaporate, support payors and support recipients are going to feel the financial strain.

    If you are a support payor pursuant to a court order, child and spousal support must still be paid despite the current state of affairs. Each region has its own notices and practice directions regarding support issues. Since April 6, 2020, the Notice to the Profession for the Central East Region which includes Whitby, states that the following matters are eligible for a hearing in writing or virtually before a judge:

    1. 14B motions requesting consent Orders on issues such as support – a Support Deduction Information Sheet (“SDIC”) is required to assist in completion of a Support Deduction Order (“SDO”). If one or more than one party is represented by counsel, a draft Order is to be submitted with the SDO.
    2. Consent Motions to Change (Form 15D), if a party is represented by legal counsel then the SDIC and SDO are to be filed.
    3. Case Conferences upon request by 14B, if granted, are limited to 30 minutes unless permitted otherwise by the triage judge and only 1 or 2 pressing issues can be conferenced which includes financial issues that do not meet the stringent urgency test.

    Before proceeding with motions to the Court,  first determine if you are eligible for any Federal government relief programs such as the CERB or Wage Subsidy Program.  Eligibility may allow you to at least continue partial payments. Though, keep in mind that under Section 11 of the COVID-19 Emergency Response Act, CERB payments cannot be garnished by the Family Responsibility Office (“FRO”) at this time.

    The next step would be to explain your financial situation to the person you are paying support to. Cooperate as much as possible in an attempt to agree to a temporary reduction of support and/or to pay out any arrears with a modified payment plan if and when you are able to regain employment. Once an agreement is made, request a consent motion for an Order to reflect the temporary agreement regarding support arrangements during this time.

    The Family Responsibility Office (“FRO”) has confirmed that they will not be sending any new notices of driver’s licence suspensions and are in the process of cancelling notices that were previously sent in order to reduce the number of urgent refraining motions. This means that motions to vary or stop support payments will unlikely be considered “urgent” enough to be heard by the court at this time unless the payor is in “dire financial circumstances”.

    In Theis v. Theis, 2020 ONSC 2001, the support payor mother brought an urgent motion requesting that her share of the sale proceeds of the matrimonial home be released. She was a small business owner who was forced to shut down due to provincial restrictions and her revenue had dropped to zero. Unfortunately, she failed to provide evidence of “dire financial circumstances” warranting an urgent motion including her:

    1. her previous income before the restrictions;
    2. her total income now from all sources;
    3. her personal and business expenses;
    4. the extent of her resources more generally;
    5. an updated sworn financial statement; and
    6. the results of any applications for federal relief funding and timelines.

    As a result, due to the dearth of evidence in her motion materials, no finding of dire financial circumstances could be found and her motion was dismissed.

    The key take-away is try to negotiate a temporary settlement and bring a motion on consent or as a last resort bring an urgent motion if you have enough evidence to demonstrate dire financial circumstances. Contact family lawyer Andreina Minicozzi at 289-638-3179 or andreina.minicozzi@devrylaw.ca if you have more questions about support obligations during the coronavirus/COVID-19pandemic.

    By Fauzan SiddiquiBlog, COVID-19, Family Law
    Spousal Support and Early Retirement

    Spousal Support and Early Retirement – Is it a Material Change in Circumstances and/or Can Spousal Support End in the Event of Early Retirement?

    Spousal support, sometimes referred to as maintenance or alimony, are funds that are paid to one spouse to another upon separation or divorce. There are various reasons as to why one spouse may be required to pay support to the other, usually to assist financially for a specified amount of time or to compensate a spouse who is seen to have sacrificed their ability to earn during the marriage.

    However, what happens when there are material changes in the payor’s initial circumstances which led to the decision to pay spousal support to begin with, or when the possibility of an early retirement is imminent? One could reasonably make the assumption that their obligation to pay spousal support is subject to termination, as in any circumstance, it is likely that each party would have already been in receipt of their share of the assets accumulated during the relationship.

    Unfortunately, this notion is often incorrect. – Clarifying whether the conditions for variation exist relies solely on a ‘material’ change. According to the Divorce Art, if the payor expresses an interest to amend a court order for spousal support, the court must be satisfied that a ‘change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order’. The former spouse who is requesting to obtain the variation is responsible for being able to demonstrate that the changes in circumstances are material. In other words, the onus is on the spouse who is pursuing the change, to present evidence proving the change should be granted.

    In the recent case, Hanniman v Hanniman, 2017 ONSC 7536 (CanLII) an Ontario judge set precedence for what constituted a material change in circumstances, whereby the termination of spousal support was sought and thought to be justified on the basis that one party entered early retirement.

    Ultimately, the motion to terminate spousal support was dismissed, suggesting that opting to retire early and being in receipt of less income, did not necessarily provide grounds for termination. The motive for early retirement is a factor that was not disregarded, instead, it was looked upon as a voluntary approach that did not align with a mandatory retirement policy.- For this reason, material change could not be concluded.

    Moreover, it must also be taken into account that ‘the changed circumstances, had they existed at the time of the making of the spousal support order… would have resulted in a different order.’ A stipulation in which did not appear in this circumstance.

    Nonetheless, it is always advisable for each party to consider devising a separation agreement. A domestic contract which essentially deals with any significant changes to your situation and can include specifics such as the duration in which the spousal support will be paid.

     

    Contacting an experienced lawyer for help with issues pertaining to family law matters, will provide you with the information, support and ease needed to navigate through the complexities one may face during a divorce or separation. At Devry Smith Frank LLP, our mission is to help you understand your entitlements, providing each client with the advantage of having a reliable source of legal advice.

    Contact Andreina Minicozzi, of Devry Smith Frank LLP, for experienced family law assistance, at andreina.minicozzi@devrylaw.ca or 289-638-3179

     

    “This article is intended to inform. Its content does not constitute legal advice and should not be relied upon by readers as such. If you require legal assistance, please see a lawyer. Each case is unique and a lawyer with good training and sound judgment can provide you with advice tailored to your specific situation and needs.”

    By Fauzan SiddiquiBlog, Family Law