STEPS TO USING THE SPOUSAL SUPPORT ADVISORY GUIDELINES

BY LONNY L. BALBI, QC OCTOBER, 2009

WITH CHILD SUPPORT FORMULA

*Page numbers refer to the “Spousal Support Advisory Guidelines” July, 2008.

  1. ENTITLEMENT
    • Must have finding (or agreement) before SSAGs considered.
    • Basis of entitlement should be identified, including compensatory [p39]; non-compensatory [p39]; contractual [p28-29] or a mix.
    • See examples [p37-39] of “no entitlement” cases.
  2. APPLYING SSAGs TO CERTAIN SITUATIONS
    1. Application to Divorce Act [p42-43], and generally Provincial/Territorial law [p42-43];
    2. Application to Agreements SSAGs do not give power to reopen or override spousal support agreements. If final agreement can be set aside, SSAGs may apply to setting new spousal support. SSAGs may also assist in analysis in tests set out in Miglin [p141-142];
    3. Application to interim order/final orders;
    4. Application at review and variation– can apply to increase in recipient’s income; decreases in payor’s income; post-separation increases in payor’s income; post-separation reduction in recipient’s income; re-partnering/re-marriage; second families;
  3. INCOME
    • Start with same income as FCSGs, with some adjustments.
    • Timing for determining income – date of hearing or date of agreement. Caution if lengthy separation or substantial increase in payor income [p144-146].
    • Deductions [p76-77] - Include income taxes, EI premiums, CPP and deductions that benefit recipient spouse or children. Do not deduct mandatory pension deductions [p99-100]. Do not deduct work incentives (e.g. clothing, commuting to work etc.) for payor.
    • Imputing Income– A more central issue under SSAGs, particularly recipient spouse and self-sufficiency.
    • Ceilings– Above $350,000, discretion is used.
    • Floors– Income below $20,000/$30,000 requires adjustments.
  4. WITH CHILD SUPPORT FORMULA
      • The basic With Child Support Formula for amount
        1. Determine the individual net disposable income (INDI) of each spouse:
          • Payor’s INDI = Guidelines income minus child support minus taxes and deductions minus spousal support
          • Recipient’s INDI = Guidelines income minus notional child support minus taxes and deductions plus government benefits and credits plus spousal support
        2. Add together the individual net disposable incomes. By iteration, determine the range of spousal support amounts that would be required to leave the lower income recipient spouse with between 40% and 46% of the combined INDI.
      • The basic With Child Support Formula for duration
        • Initial orders indefinite (duration not specified)
          • subject to cumulative durational limits implemented by review or variation:
            • Upper End of the Range: the longer of
              • The length of the marriage; or
              • The date the last or youngest child finishes high school
            • Lower End of the Range: the longer of
              • One-half the length of marriage; or
              • The date the youngest child starts full-time school
    2. Shared Custody Formula;
    3. Split Custody Formula;
    4. Step-Children Formula;
    5. Custodial Payor Formula;
    6. Adult Children Formula;
    7. Crossover.
  5. USING THE RANGES
    Arguments within the ranges    :
    1. Strength of Any Compensatory Claim;
    2. Recipient’s Needs – Limited income and/or earning capacity, age;
    3. Age, Number, Needs and Standards of Living of Children – Look at special needs children, infants, toddlers;
    4. Needs and Ability to Pay of Payor – Consider net income consequences and large mandatory deductions and meaningful access by payor;
    5. Work Incentives for Payor – Relevant in most cases of substantial child support. Consider additional out-of-pocket costs and payor’s net income to ensure work incentives;
    6. Property Division and Debts;
    7. Self-Sufficiency Incentives – Focus on recipient and self-sufficiency.
  6. RESTRUCTURING
    • Trade off amount against duration. Front-end load, extend duration or lump sum.
  7. EXCEPTIONS
    1. Compelling financial circumstances in the interim period;
    2. Debt payment – Used only where a negative net worth and one spouse paying disproportionate share;
    3. Prior support obligations;
    4. Illness and disability;
    5. Property division; reapportionment of property.
    6. Basic needs/hardship: Custodial Payor Formula – Used where support is too low for income recipient to meet his or her basic needs;
    7. Non-taxable payor income;
    8. Non-primary parent to fulfill parenting role under the Custodial Payor Formula – Where recipient spouse plays important role in child’s care and upbringing;
    9. Special needs of child;
  8. VARIATION, REVIEW, REMARRIAGE, SECOND FAMILIES
    1. Variation.
    2. Review.
    3. Agreements [p142];
    4. Applications to reduce spousal support because of changes in income;
    5. The payor’s post-separation income increases;
    6. Recipient’s reduced income after separation;
    7. Crossover;
    8. Payor’s remarriage or re-partnering;
    9. Recipient’s remarriage or re-partnering;
    10. Second families.

*Page numbers refer to the “Spousal Support Advisory Guidelines” July, 2008.