Spousal Support: The Details
Why spousal support?
Spousal support in Ontario is premised on the view of a marriage as a financial partnership. When that partnership ends, the person with the greater income may have an obligation to pay the spouse with the lesser income. However, the law assumes that all individuals seek to be self-sufficient and the spousal support laws are drafted with this in mind. Fault is not part of the decision-making process about whether a spouse is to receive support.
Be sure to speak with your Toronto divorce lawyer as soon as possible to ensure that your rights are protected.
Spousal support, in Ontario, is payment for the support and maintenance of a spouse, either by lump sum or on a continuing basis. Support is paid by the supporting spouse to the dependant spouse. The general rule is that a spouse is dependent when he or she makes less money than the other spouse and by virtue of his or her lower income is in need of financial support from the other spouse.
Spousal support can be settled out of court in the form of a separation agreement. If you cannot agree to an amount of spousal support, you can ask a judge to make the determination of support by application, either in a separate application or in conjunction with other related applications (i.e. child support, custody).
When is spousal support awarded?
In deciding whether a spouse in entitled to support and for how long that support should be given, the court looks at several factors. These factors include the amount the person asking for support needs to meet his or her needs, and how much the other person can afford to pay. Other factors include: the age and health of the parties; the accustomed standard of living of the dependant; the need for either party to stay home and care for a child; the length of cohabitation and the effect of the dependant’s earning capacity because of domestic responsibilities assumed during cohabitation; and, any contribution to the supporting spouse’s career potential during the time of cohabitation.
The specific statutory provisions that deal with spousal support are: section 15 of the Divorce Act and section 30 and 33 of the Family Law Act. It is important to note that child support takes priority above spousal support so if there are insufficient funds to pay over and above child support, spousal support will likely be denied. Also, unlike child support, the payor of spousal support may deduct the payment for tax purposes and the recipient must claim it as taxable income.
How much spousal support?
In order to calculate spousal support, both spouses will have to file a Financial Statement showing the total income and expenses of each spouse. It is from this document that the court can determine the ability of one spouse to pay support and the need of the other spouse to receive it. Support is sometimes awarded for a specific period of time to allow one spouse to return to school in order to requalify to enter the workforce. The court is also able to impute income if it feels that one of the spouses could be making more money but is deliberately working below his or her capability. The rules that allow imputing income were created to stop deliberate attempts on the part of one spouse to avoid the financial responsibility of spousal support. Evidence that can be brought in this regard can be that the person refused to accept gainful employment, willingly refused to secure or take a job, deliberately did not apply himself or herself to a business, or intentionally left employment to go into business.
Although there are no guidelines which must be used, the Spousal Support Advisory Guidelines (SSAG) have been developed to help spouses to determine the appropriate amount to be paid. There was a lot of concern that the powers given to judges was too discretionary and that awards were inconsistent. If the parties go to court, the court may consider these guidelines in making a determination of support. These guidelines do not have to be followed, unlike the Child Support Guidelines which must be adhered to in most circumstances, but they do give a good idea of what the reasonable amount of support is. The SSAG guidelines have been developed to take into account the length of the marriage, income levels, the work history of the spouses, and the number of children. The final version of the SSAG guidelines was released in July 2008.
The SSAG guidelines consist of two formulas: one for spouses paying child support and one for spouses where there is no child support being paid. The “without child support formula” relies heavily upon the length of the relationship in determining both the amount and duration of support. The length of the relationship includes time of cohabitation before marriage as well. The formula is based on the gross family income of the spouses but it is helpful to also check the net disposable income positions of the spouses to get a realistic picture. The “with child support formula” is actually a set of formulas built around the custodial and child support arrangements of the children. For shared custody arrangements, the SSAG formula aims at a 50/50 distribution of net disposable income. This ensures similar standards of living in each of the parents’ homes. Where the recipient has custody of the child(ren) the formula basically increases the net disposable income of the recipient as the number of children living with the spousal support recipient increases. The guidelines provide ranges in amounts and duration and then the court (or you and your lawyer) can adjust the amount and duration to fit the particular specifics of your case.
The SSAG notes that it is not to be applied automatically for incomes above $350,000. This does not mean that the guidelines should not be used, but rather it gives the judge more discretion when deciding the appropriate amount of spousal support to be awarded. Moreover, when the spousal support payor has an income of under $20,000, the SSAG stipulates that no support should be paid. There are cases, however, where the lowest end of support is still awarded in such circumstances.
The SSAG can be used when drafting a separation agreement. It is a good standard to assess the fairness of any spousal support amount you are looking to agree on. The SSAG will also be important if your agreement provides for a review or variation in the future or if the agreement is set aside for any reason.
Once a support order is made, a motion to change support must be brought if there is a significant change in circumstances and you wish to change the amount of support that was ordered. Unless you had a very short marriage, courts are reluctant to place a specific time limit on spousal support, as they can rarely know how long it will take a spouse to become self-sufficient. Judges can make a review order which states that, after a certain amount of time, the spousal support can be reviewed (not necessarily changed). This relieves the spouses of having to show a material change in circumstances. Review orders are usually only granted where there is a clear date upon which the financial circumstances of the spouses will change. The SSAG guidelines have introduced the concept of time limits on spousal support for marriages less than 20 years long and the formulas do provide for these durational limits. However, since the guidelines are just a suggestion, courts are more likely to go the “softer” route and order a review rather than a strict limit. Time limits on review are more likely to be given, since a more realistic view of when the spouse will be self-sufficient is ascertainable.
As stated, the important factor to consider in a variation of spousal support is whether there has been a material change in the recipient’s or the payor’s circumstances or that new evidence has come to light that was not available at the previous determination of support. The section of the Family Law Act which deal with this is s.37(2) and it is the same section which deals with varying child support. The Divorce Act, s.17(4.1) has similar requirements for the variation of spousal support, and requires a change in the condition, means, needs or other circumstances of either spouse that has occurred since the spousal support order. Whether a particular event constitutes a material change in circumstances is dependent on the specific facts of each case, but some examples are: a large financial change in circumstances; the end of child support obligations; the birth of a child in the payor’s second marriage; and lack of effort on the part of the recipient to become employed.