Areas of Law: Family Law; Child Support; Spousal Support; Arrears
In determining whether child support arrears should be cancelled, the court must consider whether there has been a material change in circumstances and whether it would be grossly unfair not to cancel the arrears. This is a distinct test from the one to apply in considering whether to award retroactive child support
The Appellant, Robert MacCarthy, and the Respondent, Maria MacCarthy, were married in 1983 and separated in 2004. The Appellant worked as a logger and made around $100,000 per year. The Respondent helped him with his books and was the primary caregiver to their three children. She had a grade 10 education, and had worked as a hairdresser and a waitress. The couple divorced in 2006, at which time the children were aged 19, 16, and 13.
The Respondent had recently become certified as a real estate agent, after three unsuccessful attempts to pass
the real estate examinations. At trial the judge considered the Respondent’s career prospects uncertain and imputed
$10,000 per year as her income while imputing an income of $110,000 per year to the Appellant. The trial judge
ordered the Appellant to pay child support in accordance with the Federal Child Support Guidelines. The order provided that the parties would exchange financial information yearly and “automatically adjust the child support.” The spousal support order was set at $2000 per month, with the provision that the Appellant could apply for a review at any time after one year (the “review order”).
In October 2013 the Appellant filed a notice of application seeking a review of spousal support by way of a trial de novo. The Respondent filed a notice of application shortly thereafter seeking a recalculation of spousal support from July 1, 2007, judgment for arrears of spousal support, recalculation of child support from July 1, 2007, payment of arrears of child support, and a s. 7 order for special and extraordinary expenses for the children. The matter was heard in chambers. The judge found the Appellant’s income for calculating child and spousal support to be $145,000. He found the Respondent’s income to be $30,000. He made an indefinite order for spousal support at $3,500 per month. The application for unpaid child support and unpaid s. 7 expenses was dismissed.
The appeal was dismissed and the cross-appeal allowed. The Appellant took the position that the chambers judge erred in his interpretation of the trial judge’s review order. The Court of Appeal did not agree, noting that the chambers judge interpreted the review order to apply to the quantum of spousal support, not the Respondent’s entitlement to it. This not in error. The Appellant also argued that the chambers judge failed to impute higher income to the Respondent, and confused the burden on the Respondent to prove she was making reasonable efforts to become self-sufficient with an onus to show changed circumstances. The Court did not see any such error in the chambers judge’s reasoning. The Court also cited jurisprudence to the effect that trial judges must be given considerable deference on reviewing spousal and child support orders.
The party seeking to have income imputed to the other spouse has the burden of establishing an evidentiary basis. The chambers judge committed no palpable or overriding error in his analysis or conclusion in imputing income to the Respondent. On cross-appeal, the Respondent argued that the chambers judge mistakenly applied the test for refusing a retroactive award for child support to cancel the Appellant’s arrears. The Appellant argued that he was not in arrears. The Court noted that the Appellant had unilaterally decreased his child support payments in 2007 despite an increase in income, and consistently underpaid child support based on his self-assessment of his obligations. The Court of Appeal was satisfied that the Appellant was in arrears.
In considering whether to cancel arrears the court must consider whether there is a material change in circumstances and whether it would be grossly unfair not to cancel or reduce the arrears. In determining the appropriateness of a retroactive child support award, the court must consider separate factors that are
not meant to apply in situations where arrears have accumulated. The chambers judge did not find, as required, that there was a material change in circumstances and that the Appellant’s financial situation rendered him unable to pay the arrears at present or in the future. He erred in finding that the Respondent’s delay in seeking payment of the
arrears constituted a material change in circumstances.
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