STEPS TO USING THE SPOUSAL SUPPORT ADVISORY GUIDELINES

BY LONNY L. BALBI, QC OCTOBER, 2009

WITHOUT CHILD SUPPORT FORMULA

Footnote *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 [p100-101] (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.
    • Without Child Support Formula
      • Amount ranges from 1.5 to 2% times the income difference between the spouses’ gross incomes times years of cohabitation, to a maximum of 50%. The upper end of the maximum range is capped at the amount that would result in equalization of the spouses’ net incomes.
      • Duration ranges from .5 to 1 year for each year of cohabitation. Duration will be indefinite (duration not specified) if the marriage is 20 years or longer, or if the marriage lasted five years or longer, when the years of marriage and age of support recipient (at separation) added together total 65 or more (the rule of 65).
    1. Determining length of relationship – Use period of cohabitation [p56];
    2. Use amount and duration together;
    3. Restructuring – Trade off amount and duration;
    4. Exceptions;
    5. Crossover – Used when child support ceases and a crossover to Without Child Support Formula.
  4. 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. Needs and Ability to Pay of Payor – Consider net income consequences and large mandatory deductions;
    4. Work Incentives for Payor – Especially in long marriages. Consider payor’s net income to ensure work incentives;
    5. Property Division and Debts;
    6. Self-Sufficiency Incentives – Focus on recipient and self-sufficiency.
  5. RESTRUCTURING
    • Trade off amount against duration. Front-end load, extend duration or lump sum.
  6. 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. Compensatory exception in short marriages without children;
    6. Property division; reapportionment of property.
    7. Basic needs/hardship – Where basic needs to recipient are not met;
    8. Non-taxable payor income;
    9. Section 15.3: small amounts, inadequate compensation under the With Child Support Formula – Where child support is given priority and low spousal support was paid.
  7. 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.