Spousal Support Advisory Guidelines: The Revised User's Guide
8 The With Child Support Formula (SSAG Chapter 8)
The with child support formula is actually a family of formulas, built around the custodial and child support arrangements for the children. Child support takes priority over spousal support, as is directed by s. 15.3 of the Divorce Act and the equivalent provincial law provisions. The child support priority is reflected in the income calculations for these formulas. After addressing some general issues, we will work our way through the different with child support formulas.
Chapter 8 of the SSAG contains a detailed explanation of the formulas for amount and duration, and their construction. The rationale for spousal support in these cases is primarily compensatory. The interaction of child and spousal support can often raise tricky legal issues: for more, see Rollie Thompson, “The Chemistry of Support: The Interaction of Child and Spousal Support” (2006), 25 Canadian Family Law Quarterly 251. Government benefits and credits for children also affect these formulas, as public support for children and their caregivers serves to reduce the demand for spousal support for lower income parents.
Our review of the case law suggests that 90 per cent of with child support cases are resolved within the formula ranges for amount, with the remainder falling outside the ranges for good reasons like exceptions or unusual facts. This is not surprising, given the homogeneity of the fact situations that underlie most of the with child cases (except for those under the custodial payor or adult child formulas). These are primarily compensatory claims, most of them quite strong, but compensation is limited by the priority given to child support and the resulting limits on ability to pay. Apart from high incomes or one child cases, the payor’s ability to pay will be the practical limit on spousal support in most of these cases, as was recognized in Moge.
(a) Government child benefits and credits
There are a collection of public benefits and credits intended to provide support to children and their caregivers. The with child support formulas include them as income, as is explained in section 6.3 of the SSAG. The computer software automatically calculates these amounts, so they should not be input manually. The amounts are adjusted annually or at intervals by governments, and those changes are picked up by the software.
Most prominent amongst these benefits are the Canadian Child Tax Benefit, the National Child Benefit Supplement, the Universal Child Care Benefit, the child portion of the GST/HST credit, the Child Disability Benefit, and the various provincial and territorial benefit and credit schemes. The federal government has proposed to roll three of these (the Child Tax Benefit, the U.C.C.B. and the National Child Benefit Supplement) into a single new Canada Child Benefit, effective July 1, 2016. Based on our current information, it does not appear that any change to the with child support formulas will be required.
In Quebec, the with child support formulas are adjusted for Quebec’s different child support guidelines, as well as recognizing the more generous child benefits in the province: SSAG, Chapter 15.
Just a reminder: social assistance is NOT treated as “income”, whether for parents or children: SSAG 6.2. Canada Pension Plan payments are NOT social assistance and thus are income, including CPP disability payments, whether for the parent or the separate benefit paid for the children: see “Income” above.
(b) Section 7 expense contributions
The various formulas deduct from income both the table amount of child support (actual or notional) for each spouse AND the s. 7 expense contributions of each spouse. By definition, any payment of s. 7 expenses will reduce the range for amounts of spousal support. Further, the correct actual parental contributions must be input, and there is a wide range of sharing arrangements. The software assumes the “guiding principle” of s. 7(2) of the Child Support Guidelines, i.e. a sharing of s. 7 expense contributions based upon incomes after the transfer of spousal support. If the spouses agree to a different sharing arrangement, an adjustment must be made, to state the SSAG range correctly.
Lawyers and courts still fail to consider s. 7 expenses in calculating the SSAG range. We hesitate to offer examples of this recurring error. Where the s. 7 expenses are large, this error can be quite serious for the payor. In some instances, where the expenses are small or where the expenses are reduced by tax deductions and credits, the impact of the error may be relatively small. In some cases, parties agree to cost-sharing proportions going forward, without itemizing the specific s. 7 expenses. The parties should make some estimate of the future expenses in preparing SSAG calculations. If the expenses are not too large, some practical adjustment can be made by going lower in the SSAG range.
However accomplished, the s. 7 expenses must be recognized and factored into the SSAG analysis. They cannot just be ignored.
(c) No ability to pay vs no entitlement
There is an important difference between “no entitlement” and “no ability to pay” under these formulas, because of the statutory priority given to child support. A SSAG range of zeroes across the board under this formula usually does NOT mean “no entitlement”, as such a range is most likely with a larger number of children (3, 4 or more children) or large s. 7 expenses or both. In these cases, there is usually a large compensatory claim, by reason of those substantial child care obligations, but no ability to pay spousal support while the children are still around.
Once the child support obligations diminish, then s. 15.3(3) of the Divorce Act (and the provincial equivalents) will resuscitate or increase the amount of the spousal support payment and also lengthen the duration: note the exception for s. 15.3 and inadequate compensation under “Exceptions” below.
(d) A family of formulas: choose the right one
There are six formulas listed in Chapter 8 of the SSAG:
- the basic formula;
- the shared custody formula;
- the split custody formula;
- the step-child formula;
- the custodial payor formula; and
- the adult child formula.
There is no separate hybrid custody or “mixed custody” formula, as that arrangement always includes at least one child in shared custody and thus the shared custody formula is applied. Hybrid cases are given their own heading below, as these cases often have different dynamics than the “simpler” shared custody cases.
Choosing the right one amongst these formulas has become much better over time. Cases where custodial arrangements are fluid may mean a consideration of two of the formulas, as occurred in Philippe v. Bertrand, 2015 ONSC 235, where the 14-year-old son had been in equal shared custody, but then moved in most of the time with his father, with the distinct possibility of reverting back to shared custody. Two ranges were calculated by Justice Kane and alternative amounts fixed for the two possible situations. Multiple formulas are also used for retroactive spousal support claims, where the custody arrangements have varied over time.
(e) The basic formula (SSAG 8.3)
Over time, we see fewer of the basic formula cases in reported decisions, even though we know that this is by far the most common custodial arrangement: a higher-income payor pays child and spousal support to a lower-income parent with custody or primary care of the children. Most of these cases appear to settle, with the “complex” custody cases turning up more and more often in the reported decisions. In almost all of these cases, at least at the initial stage, duration will not be a big issue: orders will be “indefinite (duration not specified)”. The real issue, at both interim and initial stages, will be the location of an amount for spousal support within the SSAG range.
Most of these basic formula cases default to the mid-point, with little explanation. Only where a court goes higher or lower is there much explanation for location in the range. It appears that something like 60 per cent of all reported with child support cases order the mid-point. But the mid-point is NOT some kind of “norm”, with the rest of the range only to be used in unusual circumstances: see “Choosing Location Within the Range” below.
If anything, in the basic formula cases for low to middle-income spouses, there should be a tendency for spousal support to push up into the mid-to-high end of the SSAG range, given the significant compensatory claims with children, the needs in the home of the primary care parent and the constraints of ability to pay upon the range. A simple default to the mid-point likely leaves many of these recipients under-compensated. There may be good reasons to locate in the mid-to-lower end of the SSAG in some of these cases, notably the specifics of ability to pay for lower income payors in individual cases, but these need to be articulated. The dynamics of location with the range will be different where there is only one child or spouses with higher incomes.
(f) The shared custody formula (SSAG 8.6)
In shared custody cases, there is a clear default location for amount in the range: the amount of spousal support which would leave the children in each household with roughly similar standards of living. See Rollie Thompson, “The TLC of Shared Custody: Time, Language and Cash” (2013), 32 Canadian Family Law Quarterly 315. This outcome is consistent with the strong statements about similar living standards in Contino v. Leonelli-Contino, 2005 SCC 63.
Where neither spouse has repartnered and there are no new children in either household, the starting point should be an amount of spousal support that leaves each household with equal net disposable income.The SSAG range in shared custody cases always includes this 50/50 NDI split, to recognize the importance of this principle. This default outcome can be adjusted, depending upon housing costs and other factors. Sometimes the equal NDI point is in the mid-range, but it is just as often lower or higher in the SSAG range.
- In Ontario, there is now a strong trend to equalize net incomes in these cases: Kochar v. Kochar, 2014 ONSC 5211; Neilipovitz v. Neilipovitz, 2014 ONSC 3008; Lafazanidis v. Lafazanidis, 2014 ONSC 3287; Rankin v. Rankin, 2014 ONSC 235; Martins v. Martins, 2014 ONSC 113; Dupuis v Desrosiers, 2013 ONCJ 720; C.L.Y. v. D.G.Y., 2013 ONSC 6550; Mayer v. Mayer, 2013 ONSC 7099; Cuffe v. Desjardins, 2013 ONSC 4044; Price v. Burgess, 2013 ONSC1142; MacDonald v. MacDonald, 2012 ONSC 6657; and Hurrell v. Hurrell, 2012 ONSC 4824.
- The same strong trend is not observable in British Columbia, where trial judges seem to default to the mid-point, even in shared custody cases. In B.C., there are a large proportion of shared custody cases in the mix, much larger than in Ontario, yet the equal net income issue has not been clearly addressed. In R.D.L.J. v. B.S.J., 2014 BCSC 1566, the court suggested that an equal NDI outcome, while not out of the question, would be “a significant change in the practice and the law in British Columbia”. Yet there are also a few B.C. shared custody cases where the courts explicitly equalized net incomes: A.M.D. v. K.R.J., 2015 BCSC 1539 and Paisley v. Paisley, 2014 BCSC 1752. It is worth repeating here that there is no inherent reason in the SSAG to default to the mid-point on amount: see “Choosing Location Within the Range” below.
- Where spouses have repartnered or new children have appeared, similar household standards of living can be calculated by using an adjusted version of Schedule II to the Child Support Guidelines. Two adjustments are required. First, Schedule II ignores s. 7 contributions. Second, Schedule II does not include child benefits and credits. Both of these can be adjusted with the software: Thompson, above, at 344.
- Where spousal support is paid, 80 per cent of shared custody cases resolve child support at the straight set-off amount, leaving spousal support to make the adjustment in living standards: Thompson, above, at 336.
In the reported shared custody cases involving spousal support, it is common to see large income disparities between the spouses, which are unusual for most shared custody parents. Most shared custody cases only involve child support, and not spousal support, as the parental incomes are not that far apart.
Some lawyers and courts have been surprised by SSAG ranges for amount that start at or near 50 per cent NDI for the recipient and then go up from there, typically cases with two or three children. The argument is that spousal support should never leave the recipient with more than 50 per cent of the family’s net disposable income in shared custody cases. That view is incorrect, as the cases with big income disparities often reflect strong compensatory claims based upon past disadvantage that justify going above 50 per cent. The same is true for some of the cases where the recipient has a low income.
Duration may become a more important consideration in shared custody cases. All initial orders under the formula will be “indefinite (duration not specified)”. Where there is true shared custody after separation, the effect is to limit the continued accumulation of loss or disadvantage from child care in most (but not all) cases. The compensatory claim will primarily reflect past loss or disadvantage, which may then be met over a shorter period of time compared to the basic formula (where the recipient continues to fulfil the bulk of child care responsibilities). In shared custody cases, a time limit upon continued spousal support may thus emerge sooner, as the lower income spouse may be able to move more quickly to self-sufficiency, e.g. Shih v. Shih, 2015 BCSC 2108.
(g) Split custody (SSAG 8.7)
These are cases in which each parent has primary care of at least one child. Section 8 of the Child Support Guidelines requires a strict set-off of table amounts to determine child support, with no room for discretion. Spousal support provides a means to create financial discretion in these cases and to adjust between households. For a careful discussion, see Maber v. Maber, 2012 NBQB 337.
Unlike the shared custody formula, under the split custody formula, a 50/50 NDI split is NOT automatically included in the SSAG range, even if there is an even number of children. This is not the “default” for every split custody case: Greig v. Young-Greig, 2014 ONSC 58, where such a default position was rejected for parents who each had one child. If one parent has more children than the other in split custody, then equal net incomes makes no sense. Where there is much movement of the children between the two homes in a split custody situation, there might be a good argument for bringing household living standards closer together via spousal support.
In some split custody cases, the higher-income spouse will not claim any child support from the lower-income spouse. In these cases, an adjustment must be made, to avoid stating too high a range for spousal support (which assumes that the recipient of spousal support is in fact paying an amount for child support). For two older cases that failed to make this adjustment, see Paheerding v. Palihati, 2009 BCSC 557 and Santos v. Santos, [2008] O.J. No. 5110, 2008 CarswellOnt 7607 (S.C.J.).
(h) Hybrid or mixed custody
These are cases in which at least one child is in shared custody plus the split, sole or primary residence of the others. These are complex cases, but the software by and large solves the problems of calculation of child support and notional child support.
Because at least one of the children is in shared custody, the discretion of s.9 of the Child Support Guidelines is available in assessing child support. For a leading case on the calculation of child support in hybrid cases, see Sadkowski v. Harrison-Sadkowski, 2008 ONCJ 115. In turn, as with shared custody, that child support discretion can complicate the SSAG calculations. Any complications can be resolved by simply using the set-off to determine child support and then using spousal support to adjust, e.g. T.L. v J.L., 2014 ONSC 91.
As with split custody, there is no automatic extension of the range in the formula to include a 50/50 split of NDI, especially as there may be an odd number of children involved. If there is much movement between the homes, not just for the shared custody child, there may be a good argument in favour of equal living standards, e.g. Ryder v. Walker, 2015 ONSC 2332 (1 child primarily with mother, 2 shared, living standards should be “not too dissimilar”).
(i) Step-children: applying the formulas (SSAG 8.8)
In cases involving step-children the appropriate formula is a variant of the with child support formula. For a good example of the application of the step-parent formula see Depatie v. Squires, 2011 ONSC 1758, affirmed by 2012 ONSC 1399 (Div.Ct.) (together and married 12.5 years, wife’s child 18, husband in place of parent, wife’s income $26,399, husband’s $78,371, child support $207/mo for 4 years ($707-$500 by biological father), spousal support $1,082/mo for 9 years, explicit reference to discussion of step-parent support in SSAG).
This version of the with child support formula adjusts for any child-support obligation imposed on a step-parent. The step-parent child support may limit the parent’s ability to pay spousal support. There is a trade-off between spousal support and child support, as was noted in Stadig v. Stadig, 2013 ONSC 7334.
Occasionally, in these cases, we still see the wrong formula used, e.g. Swan v. Leslie, 2011 ONSC 6879 (used without child support instead of step-parent version of with child support; amount stated as above SSAG range, but in range if correct step-parent formula used, review at 4.5 years (together 4.5 years)).
Some of the cases will involve hybrid custody situations, with sole custody of the step-child but shared custody of the common child/children.
Concerns about the with child support formula generating spousal support awards that are too substantial, for example in cases of short marriages where a low threshold for a finding of step-parent status has been applied, can be met by using the length of marriage test for duration.
- See Swan, above; Shen v. Tong, 2013 BCCA 519 (3 years together, 1 step-child, mid-SSAG for 3 years); Decker v. Fedorsen, 2011 ONCJ 850 (7 years together, 1 step-child with wife, mid-SSAG, 2 more years (total 5)); Cameron v. Cameron, 2015 ONSC 196 (7 year marriage, 1 step-child, 1 child of own, both shared, duration 3.5 years); and Karkulowski v. Karkulowski, 2015 ONSC 1057 (2 years together, 2 step-children, lump sum of $5,000, low end of ranges).
Under s. 5 of the Child Support Guidelines, it is possible for a step-parent to pay less than the table amount of child support, if appropriate. Where the amount of child support is reduced under s. 5, the with child support formula should still be calculated using the full table amount rather than the reduced amount. If this adjustment is not made, the result is an inappropriately higher spousal support range. In Stadig, above, the court incorrectly considered the range on the reduced child support amount. For an example of the correct and careful application of this step-parent formula, see Collins v. Collins, 2008 NLUFC 31. For two other examples, where the math is not set out, see Shen v. Tong, 2013 BCCA 519 and Durden v. Durden, 2014 ONSC 3242.
(j) The custodial payor formula (SSAG 8.9)
These are cases where the higher-income payor of spousal support is also the primary or custodial parent of the children. Spousal and child support may now flow in opposite directions. This category of cases is becoming much more common, amounting to 20 per cent of all the reported decisions in most provinces, and even higher in Ontario.
For some reason, many lawyers seem to have forgotten the leading appellate case in Canada on this formula, the Ontario Court of Appeal decision in Cassidy v. McNeil, 2010 ONCA 218. In Cassidy, the wife had a compensatory claim after a 23-year marriage, and Lang J.A. removed a time limit, making the support order lower and indefinite on appeal.
As these cases multiply, it turns out that custodial payor cases are a real mixed bag. Not just fathers with teenage children paying support to their wives, but also men making claims against higher-income primary care wives with younger children or disabled spouses claiming support and a range of other situations. Many claims are non-compensatory, but there are also a substantial number of compensatory claims.
Unlike the other with child support formulas, this is a more diverse group of cases, which is reflected in the variety of outcomes. We see less defaulting to the mid-point on amount and more complex issues of duration, more like the without child support formula cases. In short, a custodial payor case requires more careful analysis.
- Examples of strong compensatory claims, all by wives, would be: Cassidy v. McNeil, above; Toscano v. Toscano, 2015 ONSC 487; and Fisher v. Fisher, 2014 ONSC 4941. In some cases, husbands had good compensatory claims, as well as non-compensatory claims: Cowell v. Cowell, 2014 ONSC 1898 and Bennett v. Reeves, 2014 ONCJ 145.
- Other claims are non-compensatory: Tscherner v. Farrell, 2014 ONSC 976; Papasodaro v. Papasodaro, below; Brooks v. Brooks, 2014 NBCA 29; and Carson v. Carson, 2013 NBQB 275.
The custodial payor formula is built around the spine of the without child support formula, driven by the gross income disparity and the length of cohabitation/marriage. Consistent with the priority to child support, before calculating spousal support, each spouse will have deducted the grossed-up amount of table child support plus the grossed-up value of their s. 7 contributions. The range for amount generated by this formula thus already adjusts for the costs of child care for the custodial parent, a point missed by the court in Kay v. Kay, 2014 ONSC 6274. To adjust further through going lower in the range (or even below the low end of the range) will amount to double-counting, apart from unusual cases.
One reservation should be noted. Where the custodial payor has a very high income, the grossed-up notional amount of child support deducted will be very large, perhaps too large compared to the actual cost of caring for children. As the custodial payor’s income rises, towards the “ceiling” and above it, it becomes possible, and even advisable, to go higher in the range for amount. For examples of high-income custodial payors, see T.N. v. J.C.N., 2015 BCSC ($982,626) and T.T. v. J.M.H., 2014 BCSC 451 ($597,000). This specific point is discussed in T.T. v. J.M.H.
In every custodial payor case, one of the first questions to ask is whether the lower-income spousal support recipient is or is not paying child support to the higher-income custodial parent. In many of these cases, the higher-income parent does not claim child support from the lower-income parent. If no child support is paid by a spouse otherwise liable to pay child support, there must be an adjustment, so that there is no grossed-up deduction of child support on that spouse’s side of the formula. Absent this adjustment, the SSAG range will be too high.
The formula deducts a grossed-up amount of child support from the recipient, which adjusts for the different tax treatment of child and spousal support.
- If no child support is paid, it is incorrect to calculate spousal support, and then to simply deduct the unpaid child support amount from the spousal support, as was done in an otherwise careful judgment in Philippe v. Bertrand, 2015 ONSC 235. There the after-tax amount of child support that should have been paid was just deducted from the before-tax amount of spousal support to be paid.
- If there is a child support order made, the different tax treatment also means a court should NOT order a set-off of child support against spousal support in these custodial payor cases, as that may risk losing deductibility for that portion of spousal support.
The deduction of grossed-up amounts for notional child support obligations for the custodial spouse not only reduces the amount of support payable, but it also tends to generate a fairly narrow range of amounts for most short-to-medium-length marriages, compared to the other with child support formulas. And that group of relationships are the most common situations where this formula operates, given the presence of minor children.
Another notable effect of this formula: the recipient is often left with less than 30 per cent of the net disposable income. There are some in Ontario who believe that the recipient should never be left with less than 40 per cent NDI after spousal support, for reasons that are unclear.
- One example of a case where these issues were raised is Papasodaro v. Papasodaro, 2014 ONSC 30. This formula was criticized as “harsh” by Justice McGee, for leaving the recipient husband with less than 29% of the NDI. But the facts explain why the formula generated that range: a 17-year marriage, 3 children with the payor wife (producing sizeable grossed-up notional child support), the wife earned $101,535/year at the bank, while the husband earned $48,300/year as a school custodian, and his claim was non-compensatory. The spousal support paid to him was fixed at $1,000/mo., above the $831/mo upper end of the SSAG range. If there had only been two children in Papasodaro, the recipient husband would have ended up with 31-33 per cent NDI, and if there had only been one child, that percentage would have risen to 35-37 per cent NDI. Or, if they had been together longer than 17 years, his post-support NDI percentage would have been higher too.
- A better case for departure from the custodial parent range might be Toscano v. Toscano, 2015 ONSC 487, where the husband had custody of the two children after an 18-year marriage, his income was $493,335/year, income of $40,000 was imputed to the wife (child support of $579/mo) and the husband paid all the university and private school expenses of the children totalling $43,700/year. Not surprisingly, given the husband’s table and s. 7 child support, the wife would be left with 21-27 per cent NDI on the SSAG range (high end was $6,716/mo). Blishen J. ordered spousal support of $11,300/mo, giving the wife 37.5 per cent of the NDI. At his much higher income level than Papasodaro, Mr. Toscano could afford to pay more on his wife’s strong compensatory claim (she had been home for 13 years). Further, one can ask, above $350,000, whether the grossed-up notional child support table amount might be too generous in a case like this.
Exceptions may provide a response to these concerns in some cases. If the recipient spouse, the non-primary parent, continues to play an important role in the children’s care and upbringing after the separation, there is an exception for the non-primary parent to fulfil parenting role. In a short marriage with a young child, the custodial payor formula will not generate large enough spousal support for the active non-primary parent, e.g. Mumford v. Mumford, 2008 NSSC 82. More spousal support may be necessary for the parent to provide adequate housing for the children, e.g. Osanlo v. Onghaei, 2012 ONSC 2158. This exception is dealt with in more detail, below, under “Exceptions”.
In some custodial payor cases, disability issues may explain the non-primary spouse’s inability to assume primary care of the children. In many situations, disability can be accommodated by the location in the range for amount or duration under this formula. In more extreme cases, resort to the illness or disability exception may be necessary to provide adequate support, especially in shorter marriages. For an example, see S.D. v. J.D., 2012 NBQB 237.
The custodial payor formula does generate time limits for initial orders, the same as those under the without child support formula.
- If the marriage lasts longer than 20 years or the “rule of 65” applies, then support will be indefinite, as it was in Cassidy v. McNeil, above.
- Indefinite orders are often made for longer marriages less than 20 years where the non-custodial wife has a compensatory claim, e.g. Toscano v. Toscano, 2015 ONSC 487 (married 18 years); T.T. v. J.M.H., 2014 BCSC 451 (17 years); and Papasodero v. Papasodero, 2014 ONSC 30 (17 years).
- Where time limits are imposed under this formula, they fall within the range, typically towards the upper end of the range, e.g. B.M.P.v. S.L.B., 2015 BCSC 448 (together 7 years, low SSAG for 7 years); Philippe v. Bertrand, 2015 ONSC 235 (together 18 years, time limit of 12 years); Bennett v. Reeves, 2014 ONCJ 145 (together 16 years, time limit of 9 years); Polak v. Polak, 2013 ONSC 4670 (married 8 years, time limit of 7 years); C.A.K. v. D.E.D.L., 2013 ONSC 2777 (together 7 years, time limit of 6 years); J.D.P. v. R.M.P., 2010 BCSC 1873 (married 17 years, time limit of 13 years).
(k) The adult child formula (SSAG 8.10)
The adult child formula is another hybrid formula, similar to the custodial payor formula in that it too is built around the spine of the without child support formula. The adult child formula applies only where the last child or children of the marriage have their child support fixed under s. 3(2)(b) of the Child Support Guidelines.
If the adult child or children are living with one of their parents and attending university, then child support is determined under s. 3(2)(a), i.e. table amount plus s. 7 expenses. In these cases, other versions of the with child support formula will apply, e.g. the basic with child support formula, or the split or shared custody formula, or the custodial payor formula (many of the reported cases involving adult children fall into this last category).
The most common circumstances where s. 3(2)(b) applies are for adult children where the “table-amount-plus- s. 7-expenses” approach is not appropriate :
- a child lives away from home for college, university or other post-secondary education
- a child has other sources of income or resources to cover all or most of their higher education, e.g. a good job, grandparents, scholarships, RESPs, etc.
- a child pursues advanced degrees and is expected to contribute a larger proportion of their education costs
- an adult child is disabled and receives his or her own social assistance or other independent disability funding
In these cases under s. 3(2)(b), child support is usually determined by constructing a monthly budget for the child, assessing the child’s contribution first and then dividing the balance between the parents based upon their respective incomes.
This adult child formula only applies where the child support for all the remaining children of the marriage, one or more, is determined under s. 3(2)(b). If there is another child in the mix whose child support is determined under s. 3(2)(a), i.e. table amount plus s. 7 expenses, then the adult child formula does not apply. So, if one parent has the primary care of two children, one in high school and another away at university, then the basic formula will apply, but with some adjustment required if the adult child’s support is assessed under s. 3(2)(b), as was done in Robitaille v. Trzcinski, 2015 ONSC 4621 and McConnell v. McConnell, 2015 ONSC 2243. Mixed cases like these are relatively common in the case law, although it is not always clear that counsel or the court have made the necessary adjustments for the adult child support.
The adult child formula can accommodate a wide range of arrangements for the payment of a child’s education. For each parent, deducted from their Guidelines income will be a grossed-up amount for each parent’s contribution to child support, after which the formula ranges are calculated using the without child support formula math. If the higher-income spouse pays the full costs of university education, then that amount, grossed up, will be deducted on his or her side, while no amount will be deducted from the Guidelines income of the lower-income spouse. If the spouses decide to share the university costs equally, despite different incomes, the grossed-up deduction of equal child support contributions will adjust for that arrangement.
The adult child formula seems to be the “forgotten formula” amongst the many variants of the with child support formula. Admittedly, this formula likely applies to the smallest number of cases, compared to the other versions. But we would have expected to see this formula crop up in the case law more often than it has.
Much more seriously, a review of the case law reveals that lawyers and judges dealing with spousal support frequently just ignore child support entirely in cases of adult children under s. 3(2)(b) CSG. This is a serious mistake, as post-secondary child support obligations will usually be quite large. For many couples, whether together or apart, there are financial sacrifices involved during these post-secondary years. Practically, for separated couples, this translates into a trade-off between child support and spousal support: T.T.B. v. P.H.D., 2014 NBQB 164 (wife accepted reduction in spousal support in return for husband assuming all university costs for two children).
There are some cases where parties agree to calculate spousal support first, using the without child support formula and, once spousal support has been determined, then the post-support gross incomes are used to allocate the university costs of the adult child: Cork v. Cork, 2014 ONSC 2488 and Overell v. Overell, 2012 ONSC 6615 (no agreement, just acquiescence of the wife where the children resided with the husband and he paid the expenses). It is not clear that a court can resolve the issues in this sequence, given the statutory priority given to child support in s. 15.3 of the Divorce Act. In a few cases, courts have simply calculated spousal support under the without child support formula, and then used the child support obligations of the higher income spouse to justify a lower location in the range, e.g. Wang v. Song, 2013 ONSC 32 (adult child likely to go to medical school, higher-income wife likely to assist her). This makeshift solution is probably unwise, as it is likely that there will be an over- or under-adjustment for the child support obligations in determining spousal support.
What complicates the determination of spousal support in these adult child cases are the wildly-varying arrangements made for funding their education. This is true whatever version of the with child support formula is used, and not just those relatively few cases to which the “adult child” formula was intended to apply. Once s. 3(2)(b) is used to determine child support for just one of the children subject to the order, adjustments will have to be made in doing the SSAG calculations under the basic, shared, split, step-child or custodial payor formulas. Many of these will involve manual adjustments and judgment calls, and lawyers must be transparent about them in negotiations and advocacy.
In the cases involving adult children, whether s. 3(2)(a) or s. 3(2)(b) is used for child support, it is often not clear what formula is being used, how child support is accounted for or what adjustments have been made. The failure to cite and apply the adult child formula is just one of the many problems in determining spousal support where there are adult children. These are complex and difficult cases, with many moving parts and much potential for errors along the way. One of those errors has been the failure to keep the adult child formula in mind as an option.
A sub-set of the s. 3(2)(b) cases involve adult children with disabilities, who continue to reside with one of the spouses, but receive independent incomes from social assistance or other funding bodies. There has always been a question how to mesh the child support regime with these adult funding arrangements: see John McGarrity, “The Child Support Obligations of Separated Parents of Disabled Adult Children in the Province of Ontario” (2012), 30 Canadian Family Law Quarterly 321. The issue reached the Ontario Court of Appeal in 2014: Senos v. Karcz, 2014 ONCA 459. The appeal court ruled that s. 3(2)(a) of the CSG was inappropriate where the child received his or her own ODSP (Ontario Disability Support Program). Using s. 3(2)(b) meant that a budget for the child’s expenses would need to be prepared and then the child’s ODSP deducted from the total, before the pro rata calculation of the spouses’ child support obligations on the balance. A similar approach has been followed in British Columbia, e.g. T.A.P. v. J.T.P., 2014 BCSC 2265 (spousal support was increased by $400/mo, to $2,104/mo, SSAG used for initial amount, but not variation).
One last point: an advantage in using the adult child formula is that it allows a fairly seamless “crossover” to the without child support formula once the adult child finishes his or her studies: see “Crossovers Between Formulas When Child Support Ends” above.
(l) When a child lives with a third party: what formula?
There are a very small number of cases where a child lives with neither parent, but instead with a third party, like a grandparent or some other family or community member. There is a child support obligation upon the parents, which leads us to some version of the with child support formula, but the child support is paid to the third party by one or both of them. What happens when there is also a spousal support obligation between the spouses? What formula should be used?
In our view, the adult child formula offers the proper template for these cases. Quite often these are informal care arrangements, with child support paid to the third party in amounts less than those fixed by the tables or paid by covering s. 7 and other specific expenses. The adult child formula offers a flexibility to accommodate these idiosyncratic arrangements, with each spouse’s income reduced by grossed-up amounts of child support paid to the third party. The adult child formula can also address the simpler case where both parents pay the table amount to the third party, by grossing up those table amounts. The ranges for amount and duration in these rare cases will thus reflect the underlying premises of the without child support formula, as do the custodial payor and adult child formulas.
The reasons for the child’s third-party placement will inevitably be varied and unusual. Some will be young children, others teenagers, and yet others might be post-secondary students. The basis for spousal support entitlement can be compensatory or non-compensatory. There may well be disability issues for the recipient in these cases, thus explaining the child’s placement.
(m) Issues of duration (SSAG 8.5)
Apart from the short marriage cases described below, most courts have consistently and carefully applied the with child support formula ranges for duration. Most initial orders are “indefinite (duration not specified)”. Where time limits are set, they tend to be generous, as they should be in light of the strongly compensatory claims. As discussed above, the custodial payor formula does provide for initial time limits.
Time limits do emerge over time through variation and review. There are two tests for duration under these formulas: the length-of-marriage test and the age-of-children test. The longer of the two tests applies to determine duration at both the lower and upper ends of the range. At times, the age-of-children test has been overlooked, even apart from the short marriage cases, e.g. Osborne v. Wilfong, 2009 SKQB 83. Whenever a court imposes a time limit or the parties negotiate a time limit, there should be careful consideration of the ages of the children, especially that of the youngest child, at the point where support would end.
We repeat here, as we did in previous User’s Guides, the with child support formulas are fundamentally compensatory, which means that most time limits should fall towards the higher end of the range, not the lower end. For an excellent analysis of duration under this formula, see Dabrowska v. Bragagnolo, 2008 ONCJ 360.
There is one point of significant divergence across provinces that has emerged since the Supreme Court’s decision in Leskun v. Leskun, 2006 SCC 25: the use of review orders. Review orders have fallen into disuse in Ontario and New Brunswick, while reviews remain the norm for with child support orders in British Columbia and Alberta. There are understandable concerns for the cost and relitigation involved in reviews, but review orders do provide a valuable means of addressing issues of self-sufficiency and duration in with child support cases.
(n) Short marriages, young children (SSAG 8.5.5)
This has now emerged as one of the major problems under the with child support formula. Lawyers argue for, and courts grant, a short time limit at the initial stage where the marriage is short and there are young children. The time limit on spousal support is typically fixed at the number of years of marriage or cohabitation, e.g. 4 years of support after a 4-year marriage, even though the recipient has the primary care of children aged 1 and 3.
Such short time limits will only rarely be the right outcome at the initial hearing. The vast majority of these orders should be “indefinite (duration not specified)”. Often a review will be required in these indefinite orders.
Remember that there are two tests for duration under the with child support formula. Not just the length-of-marriage test, but also the age-of-children test. The second test is more important for shorter marriages, with a range from the time the youngest child commences full-time school to the upper end of the last child finishing high school.
These are usually cases with strong compensatory claims. The compensatory claim derives less from the past disadvantage during the marriage and much more from the future disadvantage for the parent with ongoing primary care of the children, as identified in s. 15.2(6)(b) of the Divorce Act.
- Many recent cases do make indefinite orders: Gartman v. Hancheroff, 2015 BCSC 160; Zivic v. Zivic, 2014 ONSC 7262; Jirh v. Jirh, 2014 BCSC 1973;Walker v. Maxwell, 2014 BCSC 2357, upheld 2015 BCCA 282; H.F. v. M.H., 2014 ONCJ 450; and Dupuis v. Desrosiers, 2013 ONCJ 720.
- But there remain too many cases that fix short initial time limits: Fias v. Souto, 2015 ONSC 880; Ramsay v. Ramsay, 2015 ONSC 196; D.D.P. v. C.S.W., 2014 ABCA 162; Okafor v. Bowyer-Okafor, 2014 ONSC 120; Chase v. Chase, 2013 ONSC 5335; Balayo v. Meadows, 2013 ONSC 5321; and P.M.D. v. D.M.C.,2013 ONSC 5220.
One consequence of this case law is that the recipient may only request a short period of support, as in McKenzie v. Perestrelo, 2014 BCCA 161 (only 19 months of support, including retroactive support, wife claimed 23 months, after a 2-year marriage and a 2-year-old child, appeal by husband) and Yang v. Ren, 2012 BCCA 164 (2-year marriage, shared custody, low-end SSAG, 2-year time-limit, wife only requested 3 years, appeal by husband). See also Javed v. Khan, 2013 ABCA 351 (6-year marriage, child 4, wife seeks 3 years’ support, trial judge grants 18 months, on appeal increased to 28 months).
The imposition of short time limits in these cases reflects a failure of compensatory analysis. A more careful approach is needed. The most obvious area for such analysis would be the basic formula cases, where the recipient continues with a disproportionate share of child care going forward. In the more complex custody cases, like shared, split, hybrid or step-child cases, there may be circumstances that warrant shorter time limits, especially the step-child cases. A short time limit would normally mean a quick “bounce back” by the support recipient, someone with pre-existing skills who can find good employment reasonably quickly and become truly “self-sufficient.”
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