Introduction
The Supreme Court of Canada decision in D.B.S. v. S.R.G., [2006] S.C.J. No. 37 (“D.B.S.”) establishes the principles to be applied retroactive child support claims.
“Retroactive support is a claim made in a proceeding for such support for a period prior to the commencement of the proceeding”. This is based on the concept of joint responsibility of both parents to support their children.
The Child’s Status
The child for whom the support is claimed must be entitled to support at the time of the application under either the Divorce Act or under provincial legislation: D.B.S. at paras. 86 – 90; deRooy v. Bergstrom, 2010 BCCA 5
If a variation is being sought under s. 17 of the Divorce Act, the above limitation does not apply.
Special Expenses
D.B.S. makes no distinction between table support and section 7 expenses: Smith v. Selif (2008) 56 R.F.L. (6th) 8 (NSCA). But, some cases have disallowed retroactive section 7 expenses where the payor has not had notice of those expenses: Hulley v. Carroll (2007), 47 R.F.L. (6th) 159 (S.C.J.)
Effect of an Agreement
Weight will be given but is not conclusive – must make reasonable provision. Bond v. Bond 2008 ONCA 560.
Pleadings
Claims for retroactive support must be included in a claim for such relief. Amend if necessary and sooner rather than later.
Disclosure
Under the Divorce Act and Federal Child Support Guidelines, a spouse against whom a child support order is made must, on written request from the recipient (spouse or assignee) provide disclosure, not more than once per year: s. 25 of the Federal Guidelines
Under s. 24.1 of the Ontario Child Support Guidelines disclosure must be made and all support orders must contain a provision requiring updating of income and section 7 expenses.
Basis of the Award
Retroactive support is based on income earned in the year in which support is to be paid.
The Test
The court is required to balance the payer’s interest in certainty (where there is an existing order or agreement) with a need for flexibility and fairness for children. This introduces an element of discretion. The court should consider the following factors, with all factors to be considered and no one factor having any greater weight: D.B.S. para. 99:
- The recipient’s excuse for delay in seeking support;
- The conduct of the payor;
- The children’s past and present circumstances;
- Hardship to the payor occasioned by the retroactive award.
Reasonable excuse
Delay may operate against a recipient where the recipient knew that higher amounts were warranted but decided arbitrarily not to apply: D.B.S. para. 101; Baldwin v. Funston, 2007 ONCA 381, affirming (2004), 71 O.R. (3rd) 588.
In Baldwin, the recipient was aware of the payor’s significant increased income as early as May 1997. She delayed for 5 ½ years before seeking retroactive support alleging a generalized conflict if she commenced a variation proceeding. The court concluded that this was not a reasonable excuse for her delay.
Delay caused by the payor’s conduct is not unreasonable e.g. the applicant justifiably fears that the payor will react vindictively and the payor actively intimidated or discouraged the recipient form seeking increased support Koback v. Koback, 2013 SKCA 91.
Other examples – If the recipient had a physical illness; lacked the emotional or financial means to commence an application; received inadequate legal advice; the children’s emotional well-being. deRooy V. Bergstrom, 2010 BCCA 5.
The recipient lacked any knowledge of the payor’s true income (coupled with other factors of lack of financial resources and prior physical and verbal abuse during the marriage) Burchill v. Roberts, 2013 BCCA 39
Blameworthy Conduct
Blameworthy conduct is to be viewed expansively i.e. anything that privileges the payor’s interests over the child’s right to an appropriate amount of child support D.B.S. para. 106
A parent who does not automatically provide financial disclosure in not necessarily engaging in blameworthy conduct; D.B.S. para 108
A court order is presumptively valid and a reasonably held belief by the payor that he/she is meeting their support obligation is an indicator that there is no blameworthy conduct but the greater the material increases in income, the less reasonable will be the presumption that the belief is reasonably held: D.B.S., para 108; Baldwin v. Funston, 2007 ONCA 381; Burchill v. Roberts, 2013 BCCA 39 where there was a knowing and willful withholding of improved financial circumstances.
Where a court order or agreement requires annual disclosure, failure to make such disclosure will be considered to be blameworthy conduct, S.P. v. R.P, 2011 ONCA 336
A failure or refusal to comply with requests for disclosure will constitute blameworthy conduct: Shea v. Fraser, 2007 ONCA 224.
Hiding income, misleading information to the recipient; ignoring requests for disclosure or intimidation are further examples of blameworthy conduct, D.B.S. para. 108; Reis v. Bucholtz, 2010 BCCA 115; Debora v. Debora, (2006) 33 R.F.L. (6th) 525
The Child’s Circumstances
If a child experiences hardship in the past, that child should be compensated. If the child has enjoyed the same standard of living as in the past that would have been enjoyed with the payor’s proper support, this factor does not favour a retroactive award. The needs of the child remain a relevant consideration. D.B.S. paras 110 – 113.
If there is evidence that the custodial parent was struggling financially because the proper amount of support was not paid and the child suffered hardship as a result, retroactive support is to be considered. e.g. Reis v. Bucholtz, 2010 BCCA 115 – mother accumulated significant debt, income was meager – could be inferred that a retroactive award would ameliorate the positions of both the mother and child and not simply be a transfer of capital.
Where the child enjoyed a comfortable lifestyle because of a step-parent’s support, contributions form a grandparent or the child’s trust funds, even though support was not paid in accordance with income – may not be a proper case for retroactive support. Staples v. Callender, 2010 NSCA 49.
Hardship to the payor
A broad view of hardship should be taken: D.B.S. at para 114
There is a link between hardship and blameworthy conduct: D.B.S. at para 116; Costa v. Perkins, 2012 ONSC 3165 (Div. Ct.)
The effect of hardship on the payor’s other children may be a consideration: Browning v. Browning, 2008 ONCJ 388
If a retroactive award that caused hardship is otherwise justified, the court should consider creative awards to minimize the hardship [e.g. periodic payments as opposed to lump sum payments, D.B.S. at para. 116; offset against debt or an equalization payment Campbell v. Campbell, 2012 SKQB 39; vesting order against the matrimonial home Enns v. Hawkins, 2008 O.J. No. 2784]
Commencement Date
If there is no prior order or agreement, the concept of certainty of the status quo that might be relied on by the payor is less compelling absent special circumstances (e.g. hardship or ad hoc sharing of expenses). If no support has been paid, no restriction in Divorce Act as to the date from which the award takes effect. D.B.S. para. 80-81;
Martin v. Sansome 2014 ONCA 14 – effective date determined to be date of separation (February 2007) where there was blameworthy conduct and in this case no hardship on the payor.
The presumptive date for commencement is the date that “effective notice” was given. This is the date that the recipient indicated a need for support or a review and adjustment of child support, D.B.S. at para 121
Once the subject is broached, the payor can no longer assume that the status quo is fair and his/her interest in certainty is less compelling: D.B.S. at para. 121
A court order mandating financial disclosure is effective notice in and of itself Hausmann v. Klukas, 2009 BCCA 32 although other cases have held a contrary view Santelli v. Russo (2009) 68 R.F.L. (6th) 190;
The Three Year Limitation – once notice is given, the obligation on the recipient or claimant is to move the matter along. If there is delay by the claimant, the starting point is payor’s limit of liability is no more than three years from the date of formal notice. D.B.S. at para. 123
However, if there has been blameworthy conduct, the three year rule may not apply and the commencement date is presumed to be the date of the material change in the payor’s income Jepson v. Cresnjovec, 2007 ONCJ 466.
In S.P. v. R.P., 2011 ONCA 336 – retroactive support to 1995 (the effective date of the material change in the payor’s circumstances) where the payor had negotiated significant voluntary reductions based on misinformation as to the payor’s true income.
Quantum of the Award
Quantum must fit the circumstances – the Guidelines are a starting point; D.B.S. at paras 126 and 128
Under the Federal Guidelines there are two ways to adjust the quantum:
- Exercise discretion under ss. 10 (undue hardship), 3(2) (child over the age of majority or 9 (shared custody cases). It is easier to show a retroactive order causes hardship that to show that a prospective order does; or,
- Court may adjust to total amount owing by altering the time period for the retroactive award, D.B.S. at paras. 129 – 130; Koback v. Koback,2013 SKCA 91 at para 83 where a balancing of all of the competing factors was considered; Greene v. Greene 2010 BCCA 595 where there was no evidence that the children had suffered and there was delay in seeking a variation of a consent order (paras 89-90)
September 10, 2014MSS
Note: This memo is a summary of the Legal Aid memo entitled ”Retroactive Child Support 101” published on June 26, 2014 by Kathy Phillips. Reference should also be made to the Legal Aid memo entitled “Child Support – Retroactive Orders” SC1-11 published March 21, 2014 with Ms. Phillips being the contact person.
For assistance with Family Law matters, contact our team at Lancaster Brooks & Welch at 905-641-1551