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Posts from the ‘Ontario Spousal Support’ Category

Wednesday’s Video Clip: Top 5 Questions About Spousal Support in Ontario, Canada


Wednesday’s Video Clip: Top 5 Questions About Spousal Support in Ontario, Canada

In this video we review the top 5 questions about spousal support in Ontario, Canada.

Spousal support – which is sometimes called “maintenance” or (especially in the U.S.) “alimony” – is money paid from one spouse to the other after the dissolution of the relationship. The obligation to pay spousal support is a legal one, and may arise either from a marriage, or from a common-law relationship. Either spouse can make a claim for it, provided:

• the spouses have lived together in a “marriage-like relationship” for at least three years; and
• the claim for spousal support is made within one year of couples’ separation.

The obligation for one spouse to pay spousal support to the other does not arise automatically from the fact that the parties had a relationship together (whether formally married or common law). Rather, the spouse who is claiming spousal support must prove an entitlement to it.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders.  For more information, visit us at RussellAlexander.com

Wednesday’s Video Clip: 4 Ways To Enforce Child and Spousal Support Orders in Ontario


Wednesday’s Video Clip: 4 Ways To Enforce Child and Spousal Support Orders in Ontario

For those ex-spouses who are subject to a court order or have agreed that one of them will pay spousal or child support to the other, there are several points about the enforcement of such orders or agreements that are noteworthy, this video reviews some important points to consider.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Wednesday’s Video Clip: Two Necessary Evils – Know Your Obligations Re: Income Tax and Spousal/Child Support


Wednesday’s Video Clip: Two Necessary Evils – Know Your Obligations Re: Income Tax and Spousal/Child Support

Income tax: Not a popular concept even at the best of times. But add in the obligations, which arise in the context of paying child or spousal support, and it’s enough to cause heart palpitations in most Canadians.

This is because the Canada Revenue Agency rules relating to how support payments are to be treated are quite complex. To make things more confusing, the federal Income Tax Act has separate rules for spousal support as opposed to child support.

In this video we review some key points to keep in mind.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Wednesday’s Video Clip: Top 4 Points About Enforcing Child and Spousal Support Payments


Wednesday’s Video Clip: Top 4 Points About Enforcing Child and Spousal Support Payments

In this video we review ways to enforce child and spousal support Orders in Ontario.

For those ex-spouses who are subject to a court order or have agreed that one of them will pay spousal or child support to the other, there are several points about the enforcement of such orders or agreements that are noteworthy, this video will review four points to consider.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Wednesday’s Video Clip: Top 5 questions about spousal support in Ontario, Canada


Wednesday’s Video Clip: Top 5 questions about spousal support in Ontario, Canada

In this video we review some of the more common questions about spousal support in Ontario, including:

1) What is spousal support?

Spousal support — which is sometimes called “alimony” — is money paid from one spouse to the other after the dissolution of the relationship. The obligation to pay spousal support is a legal one, and may arise either from a marriage, or from a common-law relationship.

2) What is the legal basis for obtaining spousal support?

The obligation for one spouse to pay spousal support to the other does not arise automatically from the fact that the parties had a relationship together (whether formally married or common law). Rather, the spouse who is claiming spousal support must prove an entitlement to it.

A court may order spousal support, and will set an amount and duration based on various factors that exist between the parties. The jurisdiction for a court to award spousal support comes from either the federal Divorce Act (as part of a divorce order), or from the Ontario Family Law Act.

3) What factors dictate the duration and amount of spousal support?

The determination of how much support a spouse should receive, and for how long, is a complex equation. In making a spousal support order courts consider several factors, including:

• the length of the entire relationship (including time living together before marriage);

• the financial circumstances of each spouse, both during the relationship and
after separation;

• the functions performed by each spouse during the relationship;

• the financial repercussions or detrimental financial effect on one or both spouses of caring for each other or for any children of the relationship; and

• each spouse’s ability to support him or herself.

In some cases one spouse may have suffered a financial loss or disadvantage as result of joint career and lifestyle decisions made during the marriage or relationship (for example the decision to move the family so that a spouse can take a new job, or that the mother will give up her career to stay home and raise the children). A disadvantaged spouse will be entitled to support to compensate him or her for that setback.

There may also be a limit on the duration of the support that one spouse receives from the other, as means of encouraging the recipient spouse to achieve post-separation financial independence as quickly as possible. Alternatively, the order may contain a built-in review mechanism.

Note that there are certain tax consequences relating to spousal support — both from the payor’s and the recipient’s perspective. In short — and provided it is paid pursuant to either a written separation agreement or a court order — it is considered “taxable income” in the hands of the spouse who receives it, and is deductible from the taxable income of the spouse who pays it. These tax ramifications are taken into account when determining the amount of support.

4) How does the spouse’s behaviour affect spousal support entitlement?

Generally speaking, the entitlement to spousal support is not dependent on the spouse’s pre- or post-separation behaviour, morality, or ethical conduct. In other words, a spouse who is otherwise entitled to spousal support after the dissolution of a marriage will not become disentitled because he or she was violent, or because it is later discovered that he or she had an extra-marital affair during the marriage.
Having said that, a court’s determination of the amount and duration of spousal support will hinge upon each party providing forthright, comprehensive financial disclosure to each other. If in making the determination the court feels that one spouse has withheld financial information (e.g. has failed to disclose a source of significant income), the court may impute income to the spouse and award the other spouse his or her support accordingly.

5) What happens if there is a change in circumstances?

As indicated above, the notion of one spouse receiving spousal support from the other is rooted in several concepts and principles, including:

1) the financial disadvantage or dependence that relationship gave rise to must be redressed post-separation; and

2) the ability of the paying spouse to fund the spousal support award must be taken into account.

The amount or duration of spousal support may have to be adjusted if there is significant change in the financial circumstances of either party. This change must be significant, and must not have been foreseen when the separation agreement or the court-ordered spousal support award was made.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Collaborative Law Practice – Coming to More Ontario Law Firms Near You

Collaborative Law Practice – Coming to More Ontario Law Firms Near You

As the name of my firm says, here at Russell Alexander Collaborative Family Lawyers we practice what is known as “Collaborative Family Law”, which is a voluntary, contract-based Alternative Dispute Resolution (ADR) process for those seeking to negotiate a resolution of their Family Law dispute, rather than having one imposed on them by a court or an arbitrator. In many ways, it’s similar to mediation, except that it usually does not involve the participation of a neutral third party to help the couple reach a resolution.

Although use of the Collaborative Law process is perhaps not as widespread in Ontario as in other North American jurisdictions, the release on October 27, 2016 of the Ontario Collaborative Law Federation’s “Draft Accreditation Standards” paves the way for an even broader presence in the province. These Accreditation Standards aim to bring consistency, professionalism and heightened standards of competence to practitioners of Collaborative Law (like my firm).

The Ontario Collaborative Law Federation currently represents 18 groups of specially-trained professionals across the province, and imposes rigorous standards for membership. (For example, in the case of Collaborative Legal Professionals, it requires the completion of at least 40 hours of collaborative training, including interest-based negotiation skills training and Collaborative Family Law skills training).

Moreover, all Collaborative lawyers are already licensed and regulated members of the legal profession, and in their role as advocates for their clients, are already duty-bound to adhere to certain professional standards imposed by the Law Society of Upper Canada.

But once approved, the Draft Accreditation Standards will provide an additional layer of obligation and competence for all professionals who participate in the Collaborative Law process.

Accreditation is voluntary, but those who will choose to obtain this designation will have to adhere to the Accreditation Standards’ mandatory requirements (once they are approved); however, those who opt not to apply for accreditation are not prohibited from engaging in Collaborative Law provided they adhere to the same requirements.

In other words, once they are in final form, the Accreditation Standards will effectively govern both those who choose to seek accreditation, and those who do not.

This will be a welcome addition to the Collaborative Law field, and by extension a good development for Family Law litigants in Ontario. In the U.S., since the year 2010 there is already a Uniform Collaborative Law Rules and Act, which among other things standardizes the most important features of Collaborative Law participation agreements between the parties, and requires Collaborative lawyers to take certain steps and make certain inquiries of their clients.

In Canada, the use of Collaborative Law has perhaps been somewhat piecemeal in nature, but it’s growing. The Alberta Family Law Act (in section 5), the British Columbia Family Law Act (in section 8), and Saskatchewan Family Property Act (in section 44.1), each require lawyers who act on behalf of a spouse to inform him or her of the Collaborative Law service that might help resolve their matters. The legislative counterpart in Ontario (i.e. the Family Law Act) does not contain such a requirement, but it’s likely on the horizon soon.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Wednesday’s Video Clip: Ontario Divorce Law – Is Collaborative Practice Right for You?


Wednesday’s Video Clip: Ontario Divorce Law – Is Collaborative Practice Right for You?

Collaborative Practice is a way for you to resolve disputes respectfully – without going to court – while working with trained professionals who are important to all areas of your life.

In this video we introduce the concepts of collaborative practice and many of the benefits this process offers couples going through a separation and divorce in Ontario.

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

One Letter on High-End Stereos Frames Court’s View of Couples’ Dispute – Orders Husband to Pay $20,000 Per Month in Support

theatre
One Letter on High-End Stereos Frames Court’s View of Couples’ Dispute – Orders Husband to Pay $20,000 Per Month in Support

While reading a rather routine Appeal judgment in a case called Colivas v. Colivas, I took a quick look back at the earlier judgment that had been appealed on the first place, only to find some interesting passages by the lower court judge.

That earlier ruling began this way:

Occasionally, during the argument of an application, an item of evidence is presented of such an arresting nature that it at once animates and frames the entire exercise.

The court went on to frame the core issue between the now-separated couple:

[The wife] presents the marital lifestyle as one of wealth, comfort and privilege. [The husband] presents a different picture. He essentially submits that he made a good deal of money on one business deal, involving the sale of his interests in [a business]. He says the family has supported its lifestyle since 2006 by depleting the sale proceeds. [The husband] now urges restraint and modesty going forward.

I return to that arresting bit of evidence. The materials filed by [the wife] on the motion include a copy of a letter written by [the husband] in late December 2008 to a third party identified only as “Marty”. The substance of the letter makes it evident that “Marty” is someone that [the husband] has done business with in the past – specifically referencing the purchase of some rather high-end audio-visual equipment. The following is excerpted from the letter:

Dear Marty,

I have been dealing with you for a number of years now. My first purchases were slightly above entry-level pieces. At that time, you had sold me Martin Logan Speakers, Clasee Processors, and the Single Chip Runco Projector. Although I was very happy with my initial system, I have since become obsessed with having the very best possible audio/video gear money can buy.

Under your recommendation, I purchased the following: [list of equipment omitted]

You would expect that at over $250,000 you would have not only the very best quality sound and picture, but also a system that is bullet proof in terms of its reliability. And this is where you come up short…

As you are aware I entertain regularly with some of the wealthiest and most influential people in the City of Toronto in my Theatre Room. I use my impressive room and system to watch sporting events, concerts and movies and listen to music. You can imagine my embarrassment when half way through a concert or movie I get a crackling sound!

There is a certain voyeuristic thrill associated with reading a letter such as the one written by [the husband] to Marty. It offers a glimpse into a world almost all Canadians are entirely unfamiliar with. A world where private theatre rooms are powered by audio-visual systems worth more than a quarter of a million dollars. Undoubtedly there is a certain element of braggadocio to the letter. Nevertheless, it informs the matter now before the Court for a number of reasons, including:

(i) It demonstrates that the [husband and wife] lived in rather rarefied circumstances, at least at the end of 2008;

(ii) It further demonstrates that [the husband] considered himself, at least at the end of 2008, to be a wealthy man, who moved in circles of money and influence; and,

(iii) It undermines the credibility of [the husband’s] position that it is his wife who has had an insatiable and unsustainable appetite for spending. He deposed that her “rampant spending was a significant source of friction between us”. [The wife’s] spending habits may very well have been profligate. But, clearly, if she had a penchant for extravagant spending, she was not alone.

In the end, the court for the most part preferred the wife’s position, and granted her child and spousal support totaling $20,000 per month on an interim basis, even though the court expressly recognized that the husband would need to encroach on his business capital in order to meet this level of monthly support.

I suppose the lesson to be learned from this, is that Family courts will take a good, hard, intense and illuminating look at the surrounding circumstances of couple’s life, and may draw inferences from even correspondence directed at third parties.

This is a good thing to keep in mind when framing your position in court on spousal and child support issues.

For the full text of the decisions, see:

Colivas v. Colivas, 2013 ONSC 168 (CanLII)

Colivas v. Colivas, 2016 ONSC 715 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com.

The Factors That Influence Lump-Sum Spousal Support Awards

spousal-support

The Factors That Influence Lump-Sum Spousal Support Awards

Between divorced and separated couples, a spousal support order is usually structured so that one spouse will pay the other on an ongoing basis, often monthly and for a term of many years (at least until there is a material change that dictates that the order should be changed). In other words, spousal support is paid out over time, with periodic payments made in specified amounts on a regular basis. The majority of spousal support orders take this form.

However, courts have other payments structure options available to them. Somewhat less common is an award calling for a single, lump-sum payment, which is specifically authorized under section 33(9) of the Ontario Family Law Act.

In an Ontario Court of Appeal decision called Davis v. Crawford, the factors and principles that favour a court making (or not making) such an award were considered. As part of the overarching concern over whether the paying spouse can make a lump-sum payment without undermining his or her self-sufficiency, the court must consider (among other things):

• Both parties’ current assets and means;

• The assets and means they are likely to have in the future;

• The paying spouse’s capacity to provide support.

In Davis v. Crawford the Appeal Court emphasized that a court must weigh the perceived advantages of making the lump sum award being considered in the particular case against any presenting disadvantages of making such an order.

These can include:

• Whether, if the lump-sum award is ordered, the recipient spouse is unlikely to receive any equalization payment or child support payments to which she is entitled.

• Whether there will be any resulting disparity in the former spouses’ income, if the recipient spouse will not receive his or her share of the equalization payment (that otherwise represents the apportionment of the couples’ Net Family Property).

• Whether there will be a resulting inequity because the paying spouse will possibly be discharged from bankruptcy (and thus released from his or her equalization obligation, which was a topic I have written about previously [RA add link to prior article on bankruptcy])

For the full text of the decision, see:

Davis v. Crawford, 2011 ONCA 294 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com

Can the Post-Bankruptcy Distinction Between Support and Equalization Payments be Circumvented?

Past Due

Can the Post-Bankruptcy Distinction Between Support and Equalization Payments be Circumvented?

Recently I wrote “How Does an Unpaid Equalization Payment Intersect with Bankruptcy?” about the impact that a paying spouse’s bankruptcy has on the recipient spouse’s entitlement to nonetheless receive either child/spousal support, or an equalization payment as part of a separation or divorce. I observed that – perhaps surprisingly – Canadian law treats these two categories quite differently in terms of the post-bankruptcy collectability by the recipient spouse.

Perhaps this distinction is why some courts might be tempted to try to re-cast a spouse’s entitlement, to maximize the possibility that his or her valid family law-related claim against the bankrupt spouse – essentially in creditor/ debtor roles – will be more likely to be preserved and enforced after the bankruptcy.

But as a case called Mwanri v. Mwanri illustrates, this re-characterization is not always appropriate or permissible in law.

After a trial, the husband and wife were granted a divorce, with the husband being ordered to pay the wife about $50,000 as an equalization payment. However, he filed an assignment in bankruptcy soon after, without ever having paid a dime in satisfaction of that obligation (his spousal and child support payments were current, however). It was unlikely that his assets would be sufficient to satisfy the amount he owed the wife in equalization.

In light of this and other developments, the wife applied to a motions judge for an order that his ongoing child and spousal support obligations be converted to a lump-sum amount in the same amount as the equalization payment would have been, i.e. $50,000. The motion judge agreed, ostensibly under a broad discretion to do so under the Ontario Family Law Act and the federal Divorce Act. The husband was discharged from his bankruptcy shortly after.

From a legal standpoint, the motion judge’s ruling effectively circumvented the distinction in law between the types of award: Unpaid equalization payments got swept into the husband’s bankruptcy and evaporated once he was discharged, while spousal support obligations did not. So by asking for a $50,000 lump-sum spousal award – which was the same amount she would have received in equalization were it not for the husband’s bankruptcy – the wife could enforce the award even after the husband was discharged. In other words, the motions judge simply converted the mother’s now-unenforceable equalization claim into an enforceable entitlement to lump sum spousal support.

The husband objected, and brought an appeal to the Court of Appeal, claiming that the judge’s award was tantamount to re-distributing the husband’s assets in favour of the wife and in preference to his other creditors.

The Appeal Court agreed with the husband. It found that when it came time to make the support award, the motion judge had failed to consider: 1) the father’s status as an undischarged bankrupt; 2) the effect of a lump sum spousal support award on the father’s ongoing bankruptcy, and 3) the implications of the father’s eventual discharge from bankruptcy on the parties’ financial circumstances and assets.

The lump-sum award – not coincidentally in the same amount as the equalization payment would have been – had been made without regard to the father’s impending bankruptcy, and amounted to an end-run around the normal operation of the bankruptcy legislation. Since this was impermissible, the motion judge’s earlier ruling was overturned.

For the full text of the decision, see:

Mwanri v. Mwanri, 2015 ONCA 843 (CanLII)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com.