Supreme Court of Canada Establishes Framework for the Retroactive Variation of Child Support

Mark Feigenbaum

Last week, the Supreme Court of Canada released a unanimous decision in which it clarified the legal principles applicable to retroactive variation of child support applications, after a father owing $170,000 in child support arrears attempted to have the amount reduced retroactively.

Father Fails to Pay Child Support for 15 Years

The mother and father were married in 1983 and divorced in 1996. The couple had two daughters, who were aged 8 and 6 at the time of the divorce.

The court issued a divorce order on consent in 1996 which awarded the mother sole custody of the two daughters and required the father to pay child support of $115 per week per child until the daughters were no longer “children of the marriage”. At the time of the court order, the Federal Child Support Guidelines (“Guidelines”) had not yet been introduced into law. The Guidelines were enacted in 1997.

Despite the court order, from 1998 to 2012, the father was absent from the daughters’ lives and did not make any voluntary child support payments. The daughters ceased to be children of the marriage in 2012.

In 2016, the father applied to retroactively reduce child support and rescind the arrears, which totalled approximately $170,000 by that time. In support of his claim, however, he provided little documentation or financial disclosure, relying instead on unsubstantiated assertions in his affidavit about where he had worked and how much he was paid. In addition, the father claimed that he was unable to provide tax returns for the years 2000 to 2015. 

The motion judge allowed the father’s motion, finding that the enactment of the Guidelines constituted a material change in circumstances. However, the Ontario Court of Appeal overturned the motion judge’s decision and ordered the father to pay the $170,000, finding that the father had not provided sufficient financial disclosure to support his claim.

The father appealed to the Supreme Court of Canada.

Supreme Court of Canada Establishes Framework For Retroactive Variation of Child Support

The court established a clear framework for cases where the payor of child support applies under s. 17 of the Divorce Act to retroactively decrease child support, as follows: 

(1)   The payor must meet the threshold of establishing a past material change in circumstances. The onus is on the payor to show a material decrease in income that has some degree of continuity, and that is real and not one of choice. 

(2)   Once a material change in circumstances is established, a presumption arises in favour of retroactively decreasing child support to the date the payor gave the recipient effective notice, up to three years before formal notice of the application to vary. In the decrease context, effective notice requires clear communication of the change in circumstances accompanied by the disclosure of any available documentation necessary to substantiate the change and allow the recipient parent to meaningfully assess the situation. 

(3)   Where no effective notice is given by the payor parent, child support should generally be varied back to the date of formal notice, or a later date where the payor has delayed making complete disclosure in the course of the proceedings. 

(4)   The court retains discretion to depart from the presumptive date of retroactivity where the result would otherwise be unfair. The D.B.S. v. S.R.G. factors (adapted to the decrease context) guide this exercise of discretion. Those factors are: (i) whether the payor had an understandable reason for the delay in seeking a decrease; (ii) the payor’s conduct; (iii) the child’s circumstances; and (iv) hardship to the payor if support is not decreased (viewed in context of hardship to the child and recipient if support is decreased). The payor’s efforts to pay what they can and to communicate and disclose income information on an ongoing basis will often be a key consideration under the factor of payor conduct. 

(5)   Finally, once the court has determined that support should be retroactively decreased to a particular date, the decrease must be quantified. The proper amount of support for each year since the date of retroactivity must be calculated in accordance with the Guidelines.

Additionally, the court offered a summary of the principles which will now apply to cases in which the recipient applies under s. 17 to retroactively increase child support: 

a)      The recipient must meet the threshold of establishing a past material change in circumstances. While the onus is on the recipient to show a material increase in income, any failure by the payor to disclose relevant financial information allows the court to impute income, strike pleadings, draw adverse inferences, and award costs. There is no need for the recipient to make multiple court applications for disclosure before a court has these powers.

b)      Once a material change in circumstances is established, a presumption arises in favour of retroactively increasing child support to the date the recipient gave the payor effective notice of the request for an increase, up to three years before formal notice of the application to vary. In the increase context, because of informational asymmetry, effective notice requires only that the recipient broached the subject of an increase with the payor. 

c)      Where no effective notice is given by the recipient parent, child support should generally be increased back to the date of formal notice.

d)      The court retains discretion to depart from the presumptive date of retroactivity where the result would otherwise be unfair. The D.B.S. v. S.R.G. factors continue to guide this exercise of discretion. If the payor has failed to disclose a material increase in income, that failure qualifies as blameworthy conduct and the date of retroactivity will generally be the date of the increase in income. 

e)      Once the court has determined that support should be retroactively increased to a particular date, the increase must be quantified. The proper amount of support for each year since the date of retroactivity must be calculated in accordance with the Guidelines.

Applying these principles to the case at bar, the court ultimately dismissed the father’s appeal, finding that he had not established a financial change in circumstances. The father therefore had to pay the $170,000.

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At Feigenbaum Law, our goal is to help you move forward following the breakdown of a relationship while retaining as much financial stability as possible and ensuring your children are provided for. Mark Feigenbaum is able to counsel his clients on all potential risks that may result from a family law dispute, not just those related strictly to the breakdown of a marriage. Contact Mark online or call him at (416) 777-8433 or toll-free at (877) 275-4792 to book a consultation.