Court File and Parties
ONTARIO COURT OF JUSTICE
DATE: 2023 07 13 COURT FILE No.: Milton 156/13
B E T W E E N :
C.C. Applicant, Responding Party
— AND —
B.M.C. Respondent, Moving Party
Before: Justice C. Kim
Heard on: March 6, 7, 8, 9, 10, 14 and 15 Reasons for Judgment released on: July 13, 2023
Counsel: Christine Marchetti, for the applicant(s) Shawn Philbert, for the respondent(s)
Kim J.:
[1] The parties are the parents of A.M.C., born December 16, 2011.
[2] This is the second of two judgments released in this matter. It addresses the issues of section 7 expenses and section 9 child support.
[3] With respect to section 7 expenses, the Order of Justice Starr dated August 3, 2016 (“Final Order”) sets out section 7 expenses payable by the father to the mother. The mother claims that, in addition, the father should pay his proportionate share of the following expenses: Montessori School tuition, private swimming lessons, therapy, and competitive dance lessons. The father’s position is that there has been no material change in circumstances since the Final Order and, therefore, his obligations should be “capped” as set out in that order. Even if there were a change he states that, as he did not consent to any additional expenses, he is not required to contribute to them.
[4] With respect to ongoing child support, as of March 31, 2023, A. lives with each parent more than 40% of the time. The parties agree that child support must be changed. The father’s position is that child support should be payable on a set-off basis. He states that the mother’s income for support should include the mother’s RRSP withdrawals but exclude his non-taxable benefits. The mother states that her RRSPs should be excluded from her income, but that the father’s non-taxable benefits should be included. She also states that a set-off amount of child support would negatively affect A.’s standard of living in her home and therefore would not be appropriate; the mother states that she relied on full Table support when purchasing her home and that a reduction in support would force her to sell it.
[5] The mother also states that interest on arrears is an issue. While section 7 expenses were ordered on August 6, 2016, the order was not issued until May 30, 2019. No interest on arrears accrued under the Final Order has been enforced by the Family Responsibility Office (“FRO”). The mother’s position is that interest ought to be ordered payable by the father and enforced through the FRO. The father’s position is that the date of the order is the date of issue, and that he was under no obligation to pay until the date of issuance and, therefore, there is no interest payable.
Issues
[6] The issues for this court to decide are:
- What are the parties incomes and, in particular: (a) Should the father’s non-taxable benefits be included in his income for support? (b) Should the mother’s RRSPs be included in her income for support?
- With respect to section 7 expenses: (a) What is the effect of the Final Order? (b) What is the effect of the mother incurring expenses without prior consent from the father? (c) Are the expenses proposed by the mother section 7 expenses? If so, what amount is payable by the father?
- What is the Table child support payable since March 31, 2023?
- Should interest on unpaid support be ordered payable from the father to the mother?
Incomes of the Parties
Father’s Non-Taxable Benefits
[7] The father receives the following non-taxable benefits: employer-paid portions of his medical and dental insurance, and employer contributions to his defined benefit pension. The mother states that the non-taxable benefits should be added to his income for the purposes of support.
[8] Non-taxable benefits, not assessed by CRA as income and not immediately available to the payor until used, such as health benefits, term life insurance, and employer contributions to a pension, are not income for the purposes of support: Zomparelli v. Conforti, 2018 ONSC 610, at paras. 18 and following.
[9] Indeed, courts have found that without good reason there is no legal basis for including employer pension contributions in income for support: because they are not included in taxable income they are therefore not, prima facie, income. Employer contributions to pensions are distinguished from cases where an employer contributes directly to an asset of the employee such as an RRSP or where there are mandatory deductions from income towards a pension plan: D.M.B. v D.W.A.L., 2018 BCSC 1254, at para. 177; Ennis v. Ennis, 2000 ABCA 33.
[10] The general trend is that, where a parent does not have “control” over funds such that they could be directed towards child support, courts have been reluctant to characterize those funds as income: see, e.g. Fewer v. Fewer, 2016 NSSC 244.
[11] While one recent case included the employer’s portion of health benefits within the payor’s income, in that case the inclusion was conceded by the payor: Baswick v. Kahn, 2023 ONSC 3120. The father, in the instant case, makes no such concession.
[12] The father’s non-taxable benefits are not included in his income for the purposes of calculating child support.
[13] The father’s income in the relevant years is: In 2019, $164,987.00; In 2020, $134,503.00; In 2021, $134,090.00; and In 2022, $125,014.63.
Mother’s RRSPs
[14] In 2019, the mother withdrew $24,950.00 from her RRSPs. In 2020, the mother withdrew $9,950.00 from her RRSPs. In 2021, the mother withdrew $28,055.56 from her RRSPs. In 2022, the mother also withdrew funds from her RRSPs.
[15] The father asks that the mother’s RRSPs be included in the mother’s income and, further, takes the position that the mother admitted, in oral evidence, that her RRSPs ought to be included in income for the purposes of support. The mother’s position is that her RRSPs should not be included in income for the purposes of support.
[16] RRSP income is presumptively included in a party’s income for child support purposes. However, section 17 of the Child Support Guidelines provides the court with the flexibility to exclude RRSP withdrawals from income when appropriate. Courts have considered an array of circumstances in which RRSP withdrawals are excluded from income for support. The reason for the RRSP withdrawal is an important factor in the court’s determination. The unique facts of every case must be carefully considered: Fraser v. Fraser, 2013 ONCA 715 (C.A.) and Ludmer v. Ludmer, 2014 ONCA 827 (C.A.), cited in Roloson v. Clyde, 2017 ONSC 3642.
[17] The onus is on the party seeking to exclude RRSPs from their income to satisfy the court that it is appropriate to do so: Burzminski v. Burzminski, 2010 SKCA 16 (C.A.), cited in Roloson v. Clyde, 2017 ONSC 3642; Fraser v. Fraser, 2013 ONCA 715; McKenzie v. Perestrelo, 2014 BCCA 161.
[18] Once the onus has been met, the court has the discretion to pursue whatever approach it considers appropriate. There is no rule on how RRSPs are to be treated: Ewing v. Ewing, 2009 ABCA 227; additional reasons at 2009 CarswellAlta 2083 (C.A.), leave to appeal refused; Burzminski v. Burzminski, 2010 SKCA 16, at para. 11.
[19] The guiding principle in all of the case law is that the court is to determine an income figure that is fair and reasonable for the purposes of child support.
[20] I also take from the above that whether RRSPs are included in income for the purposes of support is a determination reserved to the trial judge, and not a question of fact to which a witness can attest. I therefore give no weight to the mother’s alleged admission. If I am wrong in doing so, I also conclude that the mother did not admit her RRSPs are a part of her income for the purposes of calculating child support, based on the following:
(a) The mother’s position from the outset was that her RRSP withdrawals should be excluded from her income for the purposes of support; (b) The mother maintained throughout the bulk of her oral evidence, including in her cross-examination, that the RRSPs did not form a part of her income. This was stated multiple times; (c) The mother’s alleged admission was one, brief, qualified answer that cannot clearly be interpreted to mean that she accepted the RRSPs should be included in her income for the purposes of support; (d) It is far from clear that the mother understood that her alleged admission was the opposite of her trial position; (e) The mother’s demeanour when answering the question appeared flustered and confused, and her answer was hastily given, rather than considered; (f) Finally, in her re-direct she spontaneously restated her view that her RRSPs are not a part of her annual income.
[21] It is undisputed that the parties were in litigation in each of the years that the mother withdrew her RRSPs and that she has been represented by counsel for whom she must pay. I accept the mother’s evidence that the RRSP funds were withdrawn to help her to pay her legal fees and decline to include them in her income for the purposes of child support.
[22] The mother’s income in the relevant years is as follows: In 2019, $119,007.00 less $24,950.00: $94,057.00; In 2020, $111,166.00 less $9,950.00: $101,216.00; In 2021, $143,639.00 less $28,055.56: $115,583.44; In 2022, $132,008.16.
[23] Child Support payable up until the shared schedule made in my order of March 31, 2023 is payable from the father to the mother based on the father’s income as per the Order of Justice Wolder dated September 4, 2014. At trial, counsel advised that a lump sum payment based on the father’s income had been made and that the father’s payments were up to date. This was done, however, prior to any finding with respect to the parties’ incomes in those years. If there are adjustments required on account of support payable to March 31, 2023 as a result of the findings made in this judgment and the parties are unable to agree, counsel may request directions from the court by way of 14B motion on consent without Affidavits to my attention.
Section 7 Expenses
[24] The mother asks for an order that the father pay his proportionate share of: Montessori School tuition from 2018 to 2021, swimming lessons, therapy, and competitive dance fees from Fall 2018 and ongoing. The father states he did not consent to these expenses, that they exceed the amounts ordered in the Final Order, and that he should not be ordered to pay.
Effect of the Final Order
[25] The relevant paragraphs of the Final Order state as follows:
The child shall continue to attend at her current Montessori school and summer camp until August 31, 2018. Any attendance at a Montessori school or other private school or Montessori summer camp after this date, is an issue to be resolved by the parties, or, if they cannot agree, by the court. Nothing in this order shall be construed against the Respondent in this sense of indicating his acquiescence to the child attending at a private school. The child’s attendance at her current Montessori school and summer camp until August 31, 2018 pursuant to this order represents a without prejudice compromise on the part of the Respondent. If and when the issue comes before the court, it shall be treated as a de novo issue/review and as if the child never attended at either in the first instance. Nothing in this order prevents the Applicant from enrolling the child in private school or Montessori summer camp after August 2018, however, the Respondent shall not be required to contribute to the cost of same except by agreement of the parties made in writing or further order of the court.
Commencing September 1, 2018 and on the 1st day of each month thereafter the Respondent shall pay to the Applicant, in addition to the Guideline table amount and as his proportionate share of the child’s section 7 expenses, the monthly sum of $135.48 per month based on the following: a. $85.83 – This is the Respondent’s 50% share of the total monthly cost of the total budget permitted for summer camp, $171.66 ($1030 x 2 months/12); b. $49.65 – This is the Respondent’s 54.8% monthly share of the total of the annual cost of these extracurricular activities: i. $21.67 – Total annual cost of dance is $474.60; annualized monthly is $39.55; 54.8% = $21.67; ii. $18.56 – Total annual cost of swimming lessons is $406.52; annualized monthly is $33.88; 54.8% = $18.56; iii. $9.42 – Total annual cost is $206.20; annualized monthly is $17.18; 54.8% = $9.42.
The Applicant may enrol the child in up to three replacement extracurricular activities per year for which she seeks contribution from the Respondent (may enrol the child in more but the Respondent will not be required to share in the cost). However, the total contribution that the Respondent will be required to make towards all extracurricular activities shall be capped at $49.65 (does not include summer camp) per month or $595.80 per year.
Commencing September 1, 2016 the Respondent shall be required to contribute his 54.8% share of any of the child’s future section 7 expenses not provided for above, provided he has consented to same in advance (consent not to be unreasonably withheld). If the parties do not agree upon whether an expense is a proper section 7 expense, or the amount, or, the Respondent unreasonably withholds his consent, either party may apply to the court to have the issue(s) determined.
[26] In effect, the Final Order identifies specific expenses as section 7 expenses. It sets out amounts for section 7 expenses. Payments for those expenses, or for substitute expenses, are capped. Any further expenses are to be incurred on consent, such consent not to be unreasonably withheld. Where the parties disagree, they may request a court order.
[27] The Final Order also states that a de novo analysis of the cost of Montessori school is to be conducted by me, with no weight to be given to the father’s without prejudice agreement to contribute to Montessori school up until 2018.
[28] It became apparent in his evidence that the father believes that all of his contributions towards section 7 expenses are capped in perpetuity. This is not my interpretation of the Final Order. A cap on section 7 expenses is mentioned only once, in the context of the mother being permitted to change one extracurricular activity for another of the same cost, or lower. The father’s contribution to a higher-cost replacement activity is capped. There remains, however, the ability to incur further expenses on consent and, if consent is unreasonably withheld, by court order.
[29] The father suggests that competitive dance is “capped” because A.’s dance classes are already specified in the Final Order. It is true that recreational dance classes were included in the Final Order. It is disingenuous to suggest, however, that recreational activities are equivalent to competitive level activities when the time commitment, skill level, and cost of participation are vastly different. A court ordering or limiting contribution to a recreational activity would not necessarily have competitive level activities in mind. In this case, there is nothing in the Final Order to suggest that competitive dance was considered and then rejected as a section 7 expense. There is no evidence that competitive dance was raised in the last proceeding, at all. The evidence is, rather, that A. started competitive dance in 2018, two years after the Final Order.
[30] In my view, the “cap” could not have applied to competitive dance because the issue of competitive dance was not contemplated by the parties or the court. Finally, the Final Order expressly contemplates that the parties may disagree about future section 7 expenses and, if they do, either party may bring the dispute to the court for determination.
Effect of Withholding Consent
[31] Where there is a pre-existing order or agreement that consent is required prior to requesting contribution to a section 7 expense, but that such consent may not be unreasonably withheld, the case law sets out the following:
a) Refusal to consent does not automatically absolve a parent from contributing to an expense. A court may find that consent was unreasonably withheld. Absent strict language in the agreement or order, it is open to the court to determine that an expense is a section 7 expense requiring contribution: Marchant v. Hendriks, 2013 ONSC 1695; Craig v. Niro, 2022 ONSC 5178; b) Further, the payor is expected to consider the reasonableness and necessity of an expense. Where a payor adopts a policy of blanket refusals, it may be inferred that refusal to consent was unreasonable: Craig v. Niro, 2022 ONSC 5178; c) Failure to provide notice of an expense is not fatal where consent could not be reasonably withheld, such as where expenses are for childcare: Maloney v. Choo-Shee-Nam, 2012 ONSC 3254; d) A recipient may be held strictly to the requirement to obtain consent. This is in fairness to the payor, to prevent an accumulation of expenses that the payor did not plan for or consider: Pitre v. Lalande, 2017 ONSC 208; e) Allowing a child to participate in an activity while at the same time refusing to pay is not equal to consent: Watt v. Watt, 2011 ONSC 1279; f) However, a payor who takes the children to activities but fails to respond to requests for payment should not be rewarded: Sue-A-Quan v. Duarte, 2022 ONSC 1859; g) Children should not be deprived of an entitlement to financial support as a result of the parents’ failure to communicate: Peel v. Peel, 2013 ONSC 761, at para. 139.
[32] In summary, where an order or agreement states that contribution to an expense requires prior consent, there is an expectation that the parties will communicate effectively with each other about section 7 expenses. The payor must actually consider the reasonableness of each expense; they may not merely pay “lip service” to the order or agreement. The recipient is to act fairly vis-à-vis the payor and their potential financial obligations, so that the payor can plan for and consider the expenses in question. Where the parents fail to communicate effectively to the detriment of the children, the children’s entitlement to financial support for their activity must be considered. The court may consider all of these factors when determining whether consent was unreasonably withheld to an activity.
[33] The father, on more than one occasion, took the position that his contribution to section 7 expenses should be capped at the amounts set out in the Final Order. Most striking was father’s evidence that A. was interested in volleyball, an activity that he would support. However, when the mother registered A. in volleyball as an additional activity, the father refused to contribute beyond what he was ordered to contribute in the Final Order.
[34] The father blindly applies the one criterion – whether the payment exceeds what was set out in the Final Order – to decide whether he will consent to pay for an activity. He will pay in the amount set out in the Final Order, and beyond that he does not consent to pay. The father applies a “blanket” approach which is unreasonable because it is unreasoned. It follows that his consent was unreasonably withheld.
[35] I find that it is open to this court to fully consider the expenses the mother has claimed.
Law
[36] The Child Support Guidelines, O Reg 391/97 state:
- (1) In an order for the support of a child, the court may, on the request of either parent or spouse or of an applicant under section 33 of the Act, provide for an amount to cover all or any portion of the following expenses, which expenses may be estimated, taking into account the necessity of the expense in relation to the child’s best interests and the reasonableness of the expense in relation to the means of the parents or spouses and those of the child and to the spending pattern of the parents or spouses in respect of the child during cohabitation:
(c) health-related expenses that exceed insurance reimbursement by at least $100 annually, including orthodontic treatment, professional counselling provided by a psychologist, social worker, psychiatrist or any other person, physiotherapy, occupational therapy, speech therapy, prescription drugs, hearing aids, glasses and contact lenses; (d) extraordinary expenses for primary or secondary school education or for any other educational programs that meet the child’s particular needs; (f) extraordinary expenses for extracurricular activities.
[37] Extraordinary expenses are defined in section 7(1.1) of the Child Support Guidelines as:
7 (1.1)(a) expenses that exceed those that the parent or spouse requesting an amount for the extraordinary expenses can reasonably cover, taking into account that parent’s or spouse’s income and the amount that the parent or spouse would receive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court has otherwise determined is appropriate, or
(b) where clause (a) is not applicable, expenses that the court considers are extraordinary taking into account,
(i) the amount of the expense in relation to the income of the parent or spouse requesting the amount, including the amount that the parent or spouse would receive under the applicable table or, where the court has determined that the table amount is inappropriate, the amount that the court has otherwise determined is appropriate, (ii) the nature and number of the educational programs and extracurricular activities, (iii) any special needs and talents of the child, (iv) the overall cost of the programs and activities, and (v) any other similar factors that the court considers relevant.
[38] When determining payment for a proposed extraordinary expense the court must first determine if the expense is extraordinary pursuant to s. 7(1.1) of the Child Support Guidelines and then whether the expense is reasonable and necessary pursuant to s. 7(1) of the Child Support Guidelines. When determining payment for a non-extraordinary expense such as a health-related expense, the court need only consider whether the expense is reasonable and necessary.
Montessori School
[39] The mother asks for contribution to Montessori School for the 2018-2019, 2019-2020 and 2020-2021 academic years.
[40] A. did well in Montessori school. She had the benefit of small classes and individual attention. The father agreed that Montessori school had provided A. with a positive academic foundation. His issue was the cost for tuition, some $10,000.00 to $12,000.00 annually or $1,000.00 monthly. The expense is extraordinary in relation to the mother’s income and the child support received.
[41] The parties’ combined incomes in the relevant years were in the range of $270,000.00. It was well within their joint means to enrol A. at a Montessori school, and is a reasonable expense.
[42] However, there was insufficient evidence that Montessori school was necessary for A. I am unable to find that Montessori school was a section 7 expense.
Private Swimming Lessons
[43] Costs for swimming lessons were explicitly set out in the Final Order. The costs increased significantly in 2019. I do not accept that additional costs above what was ordered were reasonable or necessary for A. I am unable to find that private swimming lessons were a section 7 expense.
Therapy
[44] Therapy is a health-related expense. The father consented to therapy with Dr. Beth McConnell on November 8, 2019, when he signed the therapy agreement. He is to pay his proportionate share for A.’s appointments on and after that date.
[45] In terms of therapy prior to November 8, 2019, the cost is reasonable. I also find that it was necessary. Both parties agreed that some form of therapeutic approach was needed to assist A.’s relationship with her father. While, ultimately, the parties retained Ms. Shazeeda Haroon, it was reasonable to explore other options.
[46] Further, the father, even after agreeing to therapy with Dr. McConnell, refused to pay his share of costs. In an email he wrote in July 2021, he effectively stated that by refusing to pay a share of the cost he hoped to teach the mother “a cheap lesson” about incurring costs without notice. I agree that it was unreasonable for the mother to incur this cost without notice. This was a breakdown in communications occasioned by her. However, it was also unreasonable for the father to refuse payment for a child’s expense as a part of a power struggle between the parents. Rather, consent must be given or refused after consideration of A.’s needs.
[47] The father is to pay his proportionate share of therapy expenses for A. for Dr. McConnell, after reimbursement from health benefits. The parties’ incomes in 2019 were $164,987.00 (64%) for the father and $94,057.00 (36%) for the mother. The total outstanding cost is $1,880.00. The father is to pay to the mother $1,203.02.
[48] The parents are to share any continued therapy expenses proportionately in accordance with their incomes, after reimbursement from health benefits.
Dance
[49] Most of the parties’ disagreement revolved around competitive dance for A.
[50] A. commenced dance lessons when she was two and a half years old. In the fall of 2018, she started competitive dance classes. She has continued in competitive dance since that time.
[51] Dance class is a place where A. has the support of her friends; where she has gained skills and confidence; where she wins awards and excels. She is exposed to the values of hard work and team membership, and to the feelings of accomplishment and pride in her achievements. Dance is a source of stability, consistency, and joy for A.
[52] The father has participated actively as a dance parent, as much as possible. He has attended almost all of the competitions and recitals. He invites family to attend, including his wife and his extended family. Finally, he has consented to A. participating in core competitive dance on an ongoing basis. He is a parent who emotionally supports his child’s achievements. I find that he has done all of these things, despite objecting to the cost, this because he knows how important dance is for A.
[53] I find it would be detrimental for A. to stop her dance lessons. It would be detrimental for her to be cut off from her friends and membership in the competitive dance team, and detrimental to take away something she has worked hard to achieve and takes pride in. It would be detrimental to her to remove something important in her life. Competitive dance is a necessary expense for A.
[54] That said, I also consider that the mother enrolled A. in competitive dance without the father’s consent. She did this in the Fall of 2018. This matter returned to court in June 2019 and the mother claimed the expense. The father was, at all times, aware that A. was enrolled in competitive dance class. The mother was aware that the father refused to pay. I have reviewed the Endorsements provided in the Trial Record. The disagreement over competitive dance was not at the forefront of the litigation at the time. Nonetheless, the father did not bring a motion to withdraw the child from her classes.
[55] It cannot be said that the father was unaware of the potential expense and that it would take him by surprise. It remained a cost to be litigated.
[56] The costs incurred for competitive dance are set out by the mother in various documents and her oral testimony, and at various amounts. The amounts were not always the same. While I appreciate that there are multiple classes, invoices, and incidental costs related to costumes and competitions, the mother’s claim in terms of a reasonable ongoing payment was somewhat unclear.
[57] In determining the cost for competitive dance over the years, I rely on the calculations provided by Applicant’s counsel referencing the Applicant’s Trial affidavit. I find the dance costs on a per-year basis are as follows: 2018: $2,208.58 2019: $2,456.82 2020: $3,997.14 2021: $4,227.09 2022: $8,790.45 2023 up to March: $3,869.57
[58] In the mother’s evidence in cross-examination with respect to the affordability of dance as a section 7 expense, she stated both: (1) that the combined cost for core competitive classes was about $4,000.00, including HST, for September to June and; and (2) that the average cost, inclusive of classes, competitions, uniforms, and costumes, was just under $10,000.00.
[59] There is no indication of what the costs are after any tax rebates or deductions from the government are accounted for. There is no indication of what number of competitions or recitals are usual for a person in the core competitive stream.
[60] I find that the cost for core competitive dance classes is $4,000.00 per year. I find that the reasonable additional costs for competition, uniforms, shoes, and costumes is $2,000.00 per year, for a total cost of $6,000.00 per year to the mother, net of any tax rebates that she has received.
[61] The monthly net cost for dance is, therefore, $500.00, divided between the parties. The parties’ combined income is roughly $250,000.00. The cost for dance is not unreasonable.
[62] The father shall contribute to A.’s core competitive dance class plus competition, costume, uniform, and other costs, which together are deemed to be a maximum total cost of $6,000.00 per year or $500.00 per month. He shall contribute monthly proportionately based on the parties’ incomes, commencing September 1, 2019. I decline to order payment prior to September 1, 2019 due to the mother’s failure to seek consent.
Section 9 and Contino analysis
[63] Child support payable after March 31, 2023 must take into account the fact that A. is residing with each parent more than 40% of the time. The governing law and legal principles are set out in section 9 of the Child Support Guidelines and Contino v. Leonelli-Contino, 2005 SCC 63 (“Contino”).
[64] Section 9 of the Child Support Guidelines states:
- Where each parent or spouse exercises parenting time with respect to a child for not less than 40 per cent of the time over the course of a year, the amount of the order for the support of a child must be determined by taking into account,
(a) the amounts set out in the applicable tables for each of the parents or spouses; (b) the increased costs of shared parenting time arrangements; and (c) the condition, means, needs and other circumstances of each parent or spouse and of any child for whom support is sought.
[65] In Khairzad v. McFarlane, 2015 ONSC 7148, at para. 66, Chappel J. provides a frequently cited summary of some of the principles drawn from Contino:
a. In shared parenting arrangements, there is no presumption in favour of the parent who has less time with the child paying the Table amount of child support. Rather, the court must determine the quantum of child support in accordance with the three factors listed in section 9. b. However, a finding that a shared parenting arrangement exists does not automatically dictate a deviation from the Table amount of child support. In some cases, a careful review of all of the factors set out in section 9 may lead the court to conclude that the Table amount remains the appropriate figure. c. None of the three factors listed in section 9 prevail over the others. In reaching an appropriate child support figure, the court must consider the overall situation of shared custody, the costs to each parent of the arrangement and the overall needs, resources and situation of each parent. The weight to be accorded to each of the three factors set out in section 9 will vary according to the particular facts of each case. d. The court emphasized that the purpose of section 9 is to ensure a fair and reasonable amount of child support. It concluded that in adopting section 9 of the Guidelines, Parliament made a clear choice to emphasize the need for fairness, flexibility and the actual condition, means, needs and circumstances of each parent and the child, even if this meant sacrificing to some degree the values of predictability, consistency and efficiency. e. The calculation of child support pursuant to section 9 involves a two-step process. First, the court must determine whether the 40% threshold has been met. Second, if the threshold has been crossed, the court must consider the factors outlined in section 9 to determine the appropriate quantum of support. f. With respect to section 9(a), the amounts set out in the applicable Tables for each parent, the court stated that the simple set-off approach outlined in section 8 of the Guidelines may be a useful starting point as a means of bringing consistency and objectivity to the child support determination. This is particularly so in cases where the parties have provided limited information and the incomes of the parties are not widely different. However, the court emphasized that the simple set-off approach has no presumptive value in carrying out the support calculation. It cautioned against a rigid application of the set-off approach, noting that the set-off figure may not be appropriate when a careful examination of the respective financial situations of the parties and their household standards of living raises concerns about the fairness of a drastic reduction in child support to the recipient. g. The court held that the judge has the discretion to modify the simple set-off amount where “considering the financial realities of the parents, it would lead to a significant variation in the standard of living experienced by the children as they move from one household to another, something which Parliament did not intend” (at paragraph 51). It emphasized that the court should insofar as possible strive for a result that avoids the child experiencing a noticeable decline in their standard of living as they move between households. h. The court highlighted that one consideration in carrying out the section 9 analysis is whether one parent is actually incurring a higher share of the child’s costs than the other, such as costs relating to clothing and activities. i. With respect to subsection 9(b), the court emphasized that this section does not refer only to the increased expenses which the payor parent has assumed as compared to the expenses that they would be incurring if they had the child less than 40% of the time. This subsection recognizes that the total global cost of raising the child in a shared custody arrangement may be higher than in a primary residence arrangement. It requires the court to consider the total additional costs attributable to the situation of shared custody. In carrying out this analysis, evidence of necessary duplication of fixed costs arising due to the shared child care arrangement may be important. j. The court recognized that not every dollar spent by a parent who has the child over the 40% threshold is a dollar saved by the recipient parent. It stated that in the absence of evidence to the contrary, it is possible to presume that the recipient parent’s fixed costs have remained the same, and that their variable costs have only marginally decreased by the other parent’s increase in time with the child. k. Financial statements and/or child expense budgets are necessary in order for the court to properly carry out the child support analysis pursuant to section 9. The judge should not make assumptions regarding additional costs attributable to a shared parenting arrangement in the absence of any evidence relating to this issue. l. The court’s discretion under section 9 is sufficiently broad to bring a parent’s claim for section 7 expenses into the analysis under that section, taking into consideration all of the factors outlined in section 9.
[66] The objective is for a fair standard of living be provided for the children with a fair contribution from both parents. There is an emphasis on being flexible in order to achieve fairness, in accordance with the facts of each case.
9(a): The applicable Table amount for each parent
[67] Using the parties 2022 incomes as the starting point for the analysis, the father would pay $1,107.00 per month based on an income of $125,015.00; the mother would pay $1,162.00 per month based on an income of $132,008.00. The set-off would result in child support payable of $55.00 per month from the mother to the father.
9(b): The increased costs of a shared parenting time arrangement
[68] Children’s budgets and Financial Statements from both 2022 and 2023 were provided by both parties.
[69] A child’s budget must be viewed with some caution, as there is a practice of treating such statements as argument rather than evidence: Francis v. Baker, at para. 47. Indeed, in this case, each party had objections to the other’s proposed child’s budget.
[70] The father submitted that allocating 50% of items in the mother’s household budget to A. was “illogical”. The mother took the position that her expenses should be equally split with A. as only she and A. occupy the home.
[71] The mother stated that the father’s budget was improperly completed. In addition, she stated that the father’s expenses will not increase significantly because the overall time A. will be in her father’s care will not increase significantly.
[72] The mother resides alone with A. and has allocated 50% of the home costs to A. I find this is unreasonable. The mother could live in a smaller home if A. was not in her care. It is not reasonable, however, to assume the home would be half the cost. It is more reasonable to assume the opposite. There are economies of scale. For instance, the mother and A. share a kitchen; if the mother lived alone she would still require a kitchen. The percentage allocated to A. in the mother’s budget for home costs is lowered to 35%.
[73] The mother has also allocated half of her monthly car costs to A. I exclude the cost of the car loan, insurance, license, maintenance, and repair on the basis that the mother would have a car even if A. was not in her care. This reduces the cost for driving A. to $300.00 per month. I further reduce that amount by 50% to account for the fact that A. will now be on a near-equal schedule and so it is anticipated that the mother’s driving on A.’s behalf will be reduced. The amount allocated for A. is therefore $150.00 per month. To this, I add $50.00 per month as the mother will continue to attend A.’s dance events when A. is not in her care to assist with make-up, hair, and costume preparation.
[74] To assess whether the father’s time with A. and therefore his expenses have increased significantly I turn to the Final Order, which sets out a parenting schedule on a five-week rotation. Within that five-week rotation, A. was in her father’s care nine out of 35 days, or about 94 days (26%) of the year. As of March 31, 2023, A. resides with her parents according to an agreed-upon schedule (“Consent Schedule”) where she is with her father more than 40% of the time.
[75] A comparison of the five-week rotation with the first five weeks of the Consent Schedule suggests there is a negligible increase in time of only 3.5 days out of 35. However, this comparison is faulty as it fails to include “week 6” when A. would primarily be with her father. When the Consent Schedule is calculated over the course of the year A. is with her father for 157 days (43%) of the year. This is an increase of 63 days as compared to the Final Order. It is a significant amount of time and it is reasonable to expect that the father’s expenses for A. will increase.
[76] The father’s evidence was that he would need to budget for A.’s hair care. The father also included the figure of $80.00 for personal hygiene items. He admitted the figures were estimates. The mother has not provided a figure in her children’s budget for A.’s hair care, nor for personal hygiene items. Her figures were not estimates, but were derived from her sworn Financial Statement. Not every child with A.’s biracial heritage requires the same hair care. Time and cost for hair care also varies widely depending on the hair style and products used. Professional hair care, which may be costly, could be offset by less costly but more time-consuming care at home. Each person must choose their own regime. No evidence was elicited on the time or cost for A.’s hair care or personal hygiene items. As the mother was meticulous in providing information for her other expenses, I conclude that the actual costs incurred to care for A.’s hair and personal hygiene items have not been significant for the mother. I therefore exclude hair and personal hygiene costs from the father’s children’s budget.
[77] The father has not included clothing costs in his children’s budget. He indicated in his Financial Statement, however, that he has an expense of $100.00 per month for child clothing costs. I consider his failure to include a clothing expense to be an oversight and include the $100.00 per month in his budget.
[78] With respect to the cost of meals for A. outside of the home, I have preferred the mother’s budget as she has actually incurred such costs and her costs are not estimates. I use the same amount for both parents.
[79] The father excludes entertainment and gifts but prioritizes family vacations. The mother excludes vacations but prioritizes entertainment and gifts. These are reasonable choices made by two different households and no adjustment is made.
[80] I have excluded pet care costs. None of the pets move with A. from home to home. The cost for the pets would be incurred whether A. resided in the home or not.
[81] I reduce both parents’ grocery costs. The mother’s grocery cost is given as $1,200.00 per month for two people in her children’s budget provided mid-trial, although her sworn Financial Statement of March 3, 2023 states $900.00 per month. The $900.00 monthly figure was based on A. living with her mother primarily and I accept that figure and that grocery costs for A. are $450.00 per month.
[82] I find that the following are the expenses for each party for A.’s care in accordance with the Consent Schedule:
| Item | Father’s Costs | Mother’s Costs |
|---|---|---|
| Utilities | $50.00 | $236.25 |
| Groceries | $450.00 | $450.00 |
| Transportation costs (car) | $150.00 | $200.00 |
| Meals outside of the home | $90.00 | $90.00 |
| Household supplies | Nil | $50.00 |
| Clothing | $100.00 | $200.00 |
| Entertainment/recreation | Nil | $25.00 |
| Gifts | Nil | $67.00 |
| Family vacation | $120.00 | Nil |
| Dance | $245.00 | $255.00 |
| SUBTOTAL | $1,205.00 | $1,573.25 |
| Housing (mortgage, property tax, repairs and maintenance) | Nil | $1,058.00 in 2022 $1,679.00 in 2023 |
| TOTAL | $1,205.00 | $2,631.25 in 2022 $3,252.25 in 2023 |
[83] The total cost of raising A. is higher for her mother than for her father. This is primarily explained by the fact that A.’s home with her father already has space for her and there will be no new housing costs incurred by him as a result of the new schedule. The mother, on the other hand, has a home for two and even with my reduction of the percentage of home costs allocated as being “for A.”, the home expense is high. Other than the housing costs, the expense to each parent for A.’s care is similar.
9(c): The condition, means, needs and other circumstances of each parent or spouse and of any child for whom support is sought
[84] As stated by Blishen J. in Kerr v. Erland, 2014 ONSC 3555, at para. 116,
“Section 9(c) requires the court to consider principles of fairness and, importantly, the standard of living of the children in each household along with the ability of each parent to absorb the costs required to maintain the appropriate standard of living in the circumstances.”
[85] The guiding objective is to set child support in an amount that ensures that the child does not have a markedly different experience in their two homes due to financial disparities of each parent: Gravelle v. Welch, 2018 ONSC 2096, at para. 118.
[86] The Court has full discretion under s.9(c) to consider “other circumstances” and order the payment of any amount, above or below the table amounts. This discretion, properly exercised, should not result in hardship: M.A. v. N.M., 2021 ONSC 5468, at para. 68.
[87] The court must use a flexible approach and there are no presumptions. The court must consider the continuing ability of the recipient to meet the needs of the child. The set-off may be modified if there are different standards of living in each home.
[88] I find that A. has enjoyed the same standard of living in both homes. The question is whether this will continue to be the case if the set-off amount of child support is ordered.
[89] The father’s present budget deficit is, as per his Financial Statement, $1,560.61 per month. This deficit includes, however, $1,314.48 per month for “unadjusted child support and section 7”. For the purpose of comparing budget deficits, these amounts are removed. This reduces the father’s deficit to roughly $250.00 per month.
[90] The mother’s budget deficit as per her Financial Statement is $3,739.47 per month. The deficit includes, however, dance, summer camp, and therapy, which are expenses otherwise allocated in this judgment. For the purpose of comparison, these amounts are removed. The mother’s deficit is thereby reduced to just over $2,700.00 per month.
[91] Each of the parties’ total household expenses overall are on par, and I find them reasonable. However, the father shares the housing costs with his wife. This contributes to his much lower budget deficit as compared to the mother.
[92] In addition, the mother’s mortgage, tax, and home insurance payments increased between 2022 to 2023 by about $2,091.00 per month. If the mother’s mortgage rate had remained the same in 2023 as it was in 2022, her household deficit would be roughly $650.00 per month. A variation from a prior order will raise different considerations as a recipient parent may have incurred expenses, especially fixed expenses, based on expectations of continued child support. I therefore must consider the effect of the mother’s reliance on receipt of full Table child support when she purchased her home: Contino, at para. 41.
[93] In terms of net worth, the father has significant debt, the bulk of which is comprised of a personal loan to his in-laws. He does make payments monthly to his in-laws for his debt to them. The debt exceeds $200,000.00 and there was no suggestion that his in-laws would forgive the debt. The father will be placed on title to his wife’s home without obtaining a mortgage. He gave no evidence to suggest that he would make any payment other than what he presently pays. While there was no evidence as to the value of the home, the evidence, including photographs, indicates it is a well-finished home with enough space to comfortably house the father, his wife, four children and pets. Once the home is transferred, the father’s net worth will improve significantly.
[94] The mother has about $158,000.00 of equity in her home. She owes a significant personal debt to her parents of $320,000.00. The mother stated in her evidence that the loan is effectively an advance on her inheritance. Once the mother’s debt is discounted by the inheritance, her net worth is roughly the value of the equity in her home.
[95] Finally, the father has one child who lives with him in his home. His wife has three children living in the home. The father, however, pays for half of the household groceries, supplies, utilities, and other household costs. He did so even when A. lived primarily with her mother. He has effectively chosen, by equally splitting costs, to use his monthly budget to benefit his wife and her children.
[96] I consider the following:
(a) The mother’s cost of having A. in her care is higher than the father’s cost. This is principally due to the higher cost of housing; (b) The mother purchased her home in reliance on a prior court order and full Table support; (c) The mother’s higher cost of housing is inflated in 2023 as compared with 2022, due to the higher interest payable on her mortgage in 2023; (d) The section 7 expense for dance is being shared, which is an additional cost for both parties; (e) The parties incomes are roughly similar, although in the past the father has earned more than the mother; (f) The father’s present monthly budget includes an equal share towards household expenses which are for the benefit of his wife and her three children; (g) The parties each have a positive net worth associated with home ownership; (h) The father obtains financial assistance from his in-laws to support his standard of living. The mother obtains assistance from her parents; and (i) The mother will, going forward, share the Child Care Benefit. The father will receive a share of it.
[97] Based on all of the above, I find that the father is better able to absorb the costs of raising A.
[98] The mother, however, cannot expect to continue to receive full Table support in order to have her housing costs covered. She has had a sudden and drastic change to her budget for reasons outside of both parties’ control. The financial responsibility for this change falls on the mother, who took a calculated risk when she chose her mortgage.
[99] For the reasons given above, the father is ordered to pay $450.00 per month more than the set-off in child support.
Interest
[100] The Final Order includes the standard clause that the order bears post-judgment interest at the rate of 3% per annum effective from the date of the order.
[101] The date of the order is August 3, 2016. An order is effective from the date on which it is made, unless the order states otherwise: Rule 25(18) of the Family Law Rules.
[102] It is the court who makes the order, not the clerk. Therefore the relevant date is the date the order was made by the judge, and not the date the clerk signed or issued it.
[103] It cannot be that a person who has failed to pay court-ordered support may escape the interest clauses attached to support because interest is not being enforced as ordered.
Other
[104] The $7,500.00 owed by the mother to the father on account of costs of a motion before Justice Hilliard has been paid and no further direction is necessary.
Order
[105] For the reasons given above, order to go as follows:
- The parents are to share any continued therapy expenses proportionately in accordance with their incomes, after reimbursement from health benefits.
- The Respondent Father shall pay to the Applicant Mother $10,276.38 on account of retroactive section 7 expenses up to and including December 31, 2022, which is calculated as follows: a. In 2019, 64% of $2,456.82 = $1,572.36, for dance; b. In 2020, 57% of $3,997.14 = $2,278.37, for dance; c. In 2021, 54% of $4,227.09 = $2,282.63, for dance; d. In 2022, 49% of $6,000.00 = $2,940.00, for dance; e. $1,203.02, for therapy.
- A.’s core competitive dance class plus competition, costume, uniform, and other costs together are deemed cost $6,000.00 per year or $500.00 per month. The father shall contribute proportionately to this cost based on the parties’ incomes.
- Based on the father’s 2022 income of $125,015.00 and the mother’s 2022 income of $132,008.00, the father’s proportionate share of competitive dance costs is 49% or $245.00 per month, payable to the mother, commencing January 1, 2023 and monthly thereafter.
- Commencing April 1, 2023 and monthly thereafter, the father shall pay to the mother $395.00 per month, based on the father’s 2022 income of $125,015.00 and the mother’s 2022 income of $132,008.00, the Child Support Guidelines, the set-off payable between the parties, plus $450.00 payable by the father to the mother in addition to the set-off amount payable.
- On an ongoing basis, the father shall pay to the mother child support in the amount of $450.00 per month, above the set-off payable between the parties.
- The parties shall exchange their tax returns and notices of assessment annually by no later than June 1st of each year.
- The final order of Justice Wolder dated September 5, 2014 shall be replaced by this final order save and except paragraphs 20 and 40.
- The final order of Justice Starr dated August 3, 2016 shall be replaced by this final order save and except that the interest accumulated pursuant to paragraphs 27, 28, 29 shall be enforced through the Family Responsibility Office, until paid in full.
[106] Outstanding claims are dismissed.
[107] If the parties are unable to agree as to costs, costs submissions may be submitted no later than thirty (30) days after release of this judgment, limited to five pages, double-spaced, plus copies of Offers to Settle and Bill of Costs.
