19 February 2017

The Spousal Support Advisory Guidelines: Why NOT to default to the MID range

by Karen F. Redmond, Family Law Lawyer

Has anyone other than JP Boyd read the entire Spousal Support Advisory Guidelines (SSAG) Revised Users Guide (“RUG”)?  SSAG RUG     I have to confess that I did not read the entire original 2008 SSAG Users Guide, nor did I make it through the 2010 updated version.  But, I have read the entire 2016 update and I learned a few things, ok I learned a lot, which I hope to share with you here in this next series of Blogs about the SSAG.   This my attempt to share some of these nuggets and to touch on some of the common mistakes and misconceptions about spousal support calculations. 

(I didn’t know, for example that it was the makers of the DivorceMate software who in 2011 provided their online calculators free for use by the general public who previously could only access spousal support calculators by hiring a lawyer or other professional. online calculator .  Shout out to DivorceMate.)  But, I digress….. 

It appears that one of the most frequent mistakes is an automatic deference by lawyers and the courts to the ‘mid-range’ of the guidelines without much consideration for the factors which support the low and high range of the calculations.  The writers of the RUG are clear that  “the mid-point is NOT some kind of “norm”, with the rest of the range only to be used in unusual circumstances”  The tendency to default to the mid range should be avoided.  They go on to say,

"If anything, in the basic formula cases for low to middle-income spouses, there should be a tendency for spousal support to push up into the mid-to-high end of the SSAG range, given the significant compensatory claims with children, the needs in the home of the primary care parent and the constraints of ability to pay upon the range. A simple default to the mid-point likely leaves many of these recipients under-compensated. There may be good reasons to locate in the mid-to-lower end of the SSAG in some of these cases, notably the specifics of ability to pay for lower income payors in individual cases, but these need to be articulated. The dynamics of location with the range will be different where there is only one child or spouses with higher incomes."

From a review of the case law, the following factors may favour a support award at the higher end of the range:

  • The recipient has a strong compensatory claim (eg. recipient moved/gave up employment for payor’s benefit; recipient funded payor’s education/training; recipient sacrificed employment opportunities because of child care).

  • The recipient has limited income.

  • The recipient has limited earning capacity.

  • The recipient has compelling needs and standard of living.

  • The recipient is older.

  • The recipient will be undertaking retraining or education in the immediate future which is aimed at promoting self-sufficiency.

  • The recipient has primary care of very young children, several children and/or special needs children (ie. age, number and needs of the children can restrict the custodial parent’s ability to work).

  • The marriage is long term.

  • The marriage is short with young children and a stay-at-home custodial parent.

  • There is no property to be divided.

  • The recipient is carrying significant family debts (but not severe enough to fall within debt payment exception).

The following factors may support an award at the lower end of the range:

    • The recipient has a weak compensatory claim.

    • The payor has limited income.

    • The payor has limited earning capacity/ability to pay.

    • The recipient does not have significant needs (eg. recipient has solid employment/income; recipient has reduced living expenses (ie. subsidized housing; mortgage free matrimonial home; shared housing costs)).

    • The recipient has remarried/repartnered.

    • The payor has significant needs.

    • The recipient is younger.

    • There is an unequal division of property in favour of the recipient.

    • The recipient holds sizeable exempt or excluded assets after division of property.

    • The payor is carrying significant family debts (but not severe enough to fall within debt payment exception).

    • In the case of a traditional marriage, the payor has costs associated with going to work, in contrast to the non-working recipient.

    • An incentive for the recipient to make greater efforts towards self-sufficiency is needed (although imputing income can also address this factor).

    • There are local and regional differences (eg. Atlantic provinces).

    • The payor has significant direct access costs (especially important when the payor is at the lower end of the income spectrum).

    • The payor makes mandatory deductions for pension contributions (especially important when the payor is at the lower end of the income spectrum).

This list is from a paper I found on the DM website HERE

My take:  This is a good reminder to us all to perhaps ask a few more questions of our clients before we make assumptions about where they may or may not fall within the SSAG range. 

Next week:  the case for 50/50 NDI (an equal sharing of net disposable income)

06 February 2017


Canada Child Tax Benefits Post Separation
As tax season is approaching I thought it might be a good time to touch on the subject of Canada Revenue Agency’s treatment of separating couples who have children.  As a family law lawyer I never give advice about taxes but there are some helpful links here and as always, speak to your accountant or a tax lawyer if you are unsure. 

Your marital status is important to Canada Revenue Agency because it impacts your eligibility for tax benefits and credits.  Information on how and why to inform CRA about your marital status can be found at the link  HERE  If you are a parent you may be eligible to receive the Canada Child Tax Benefit (CCTB) which is a tax-free payment made to eligible families to help with the cost of raising children under the age of 18.  To qualify, you must file your annual tax returns and CRA needs information about your relationship status. 

Firstly, are you a spouse?  CRA defines a spouse as someone you are legally married to or someone who you have been in a ‘conjugal’ relationship with, for 12 consecutive months.  (Note the difference here between the definition for family law purposes: the Family Law Act defines common law spouses in part, as non-married parties who have been living in a marriage like relationship for two years or more FLA SPOUSE DEFINITION )  You are also a common law spouse if you are living in a conjugal relationship with someone who is the parent of your child by birth or adoption. 

Are you separated?  CRA says you are separated when you have lived separate and apart because of a breakdown in your relationship for 90 days or more.   Once the 90 days have passed, you are considered separated on the first day that you started living separate and apart.  If you continue to live together at the same address, as many couples do, sharing parenting and other financial responsibilities, you are not separated in the eyes of CRA and you are not eligible for sharing or division of Canada Child Tax Benefits.  Interestingly, if your separation is involuntary (your spouse is incarcerated, is away for school, health or work reasons) you are not considered separated. 

After separation, in joint custody situations, the CCTB will be paid to the parent with whom the child primarily or ordinarily resides.  If the child ordinarily resides with both parents, each parent will be entitled to half of the CCTB which would be paid if they were the sole and primary caregiver. 

If you get married or start living in marriage like relationship and either of you has children who live with you, CRA will put all of the children on the female parent’s account for the purpose of calculating and paying the CCTB.   If you are a same sex couple, the CRA website, simply says, that “one of you” will get the CCTB for all of the children in the house.  Both parents must file income tax returns in order to receive these benefits.  For other credits such as GST/HST credits, only one ‘spouse’ can receive these credits and they are paid to the party whose tax return is first assessed for each taxation year and the amount is the same regardless of which spouse receives is, since it is based on family income. 

The CRA website is a useful tool if you want to calculate your payments or update your status. Information about claiming child care expenses can be found here: CRA WEBSITE 

The important thing to note is that you need to update your relationship status on FB and the CRA site, or you may be on the hook for significant repayments if you have been less than forthcoming with the information you and or your spouse has provided. 

13 January 2017

13 Tips for Cheaper Divorce (National Post)

Credit to my colleague Jonathan Lazar for sending me this article which I think is a great read for anyone either entering into or in the midst of a separation.

13 Tips for a Cheaper Divorce

Karen Redmond, Family Law

04 January 2017

In the event of a "Not So Happy New Year" Here's How to Prepare for your first meeting with a family law lawyer

With the coming of the New Year brings the dreaded New Years flood of new clients who have survived the holiday season and made the decision to separate. I thought it appropriate to share the advice I give to clients on how to prepare for a first meeting with a family law lawyer. 

If you have decided or are in the process of deciding to separate from your spouse, the wise thing to do is to consult with a family law lawyer before taking any steps, so you know what to do and more importantly sometimes, what not to do in the early stages of your separation.  The initial steps you take, particularly in choosing the process (litigation, mediation, or Collaborative Law) will significantly impact the reaction you may get from your spouse. 

  1. Do some online reading   Find out about Mediation, on the  Mediate BC website and  about Collaborative Divorce, on the Collaborative Divorce BC website.  Talk to a lawyer to see if either of these processes are appropriate for you and your spouse. 
  2. Call a family law lawyer and speak to them on the phone before you set up a face to face meeting.  See if you connect with the lawyer.  A good fit with a lawyer is really important.  As a client, you need to feel that your lawyer hears your concerns and is acting on your behalf and in your best interests and understands the specifics of your particular situation. 
  3. Speak to the legal assistant and have them send you a list of documents that you should bring to the first meeting.  Most lawyers I know have a family law document check list that they will send you before the meeting.  The more you prepare for your meeting, the more effectively the lawyer can understand your issues and provide you with the advice you need.   The general rule I tell my clients is to bring anything that is connected to the financial issues in their case, for example, tax returns, property assessments, bank account statements, investment account statements.  Anything that will be divided or accounted for, needs to be provided to the lawyer.  If you don't have access to documents, or you are worried about taking documents that will be missed, don't worry, in many cases, one spouse controls all of the finances and documents, and you can talk to your lawyer about how to go about getting copies of documents that you don't have. 
  4. Make a list of questions before the meeting.  Don't be afraid to ask, there is no such thing as a silly question.   Separation is a process that no one prepares for.  Your lawyer and their team are there to help you, and to make sure you understand the process every step of the way, so be prepared to ask lots of questions. 
  5. Don't make any changes to your Will or your insurance policy or anything else for that matter, without talking to a lawyer first. 
  6. If you have safety concerns and you are worried about your spouse finding out that you are seeing a lawyer, make sure you tell the lawyer immediately so all appropriate steps are taken to ensure your privacy and protection. 
Lastly, use your resources wisely.  Lawyers are great at giving legal advice.  If you need emotional help, there are tremendous resources for counselors and  Mental Health Professionals in Vancouver.  And if you need advice about your finances, you can ask your lawyer to refer you to a Financial Specialist . 

29 November 2016

Inheritances used to purchase property placed in joint tenancy - November 2016 update

(Not a very catchy title to this blog article I realize but the issue of excluded property and inheritances keeps coming up so I wanted to add my notes on this new case, and be perfectly clear about what it says, or what I think it says)  by Karen F. Redmond
On November 17, 2016 the BCSC decision in Lahdekorpi v. Lahdekorpi, 2016 BCSC 2143 was released, which gives us yet another little nugget on division of excluded property, in particular when inheritance funds are used to purchase property placed in joint tenancy with a spouse. 

At trial, the husband had conceded that the wife’s $30,000 inheritance was excluded property.  Mid-way through the trial, and after the Court of Appeal decision in  V.J.F. v. S.K.W., 2016 BCCA 186 was released, the husband changed his position and argued that the wife was not entitled to keep her inheritance because the money had been used to purchase the family home, therefore he argued that she lost her claim to exclusion by putting the property in joint tenancy, which gave him right of survivorship.  Mr. Justice Harris in Lahdekorpi distinguished the V.J.F. case and found that the wife’s $30,000 inheritance was still considered excluded property, saying, at paragraph 94: 

“In the instant case, the Shirley Road property was purchased, in part, with the respondent’s $30,000 inheritance and the property was registered jointly in both their names. In my view, the joint tenancy effectively preserved her contribution to the property, which was purchased for approximately $130,000. In these circumstances, I am not persuaded that the respondent could reasonably be said to have intended to gift her inheritance to the claimant. I note that, although the parties purchased subsequent properties using, in part, income derived from the Shirley Road property, the properties were either held jointly or in the sole name of the respondent. In my view, the $30,000 used in the purchase of the Shirley Road property can be traced back to the inheritance, such that it does not lose its character as an inheritance.”

So, it appears for now, that as long as you can trace your excluded property, it is safe if used to purchase property placed in joint tenancy with your spouse.  I note the reference to the ‘intentions’ of the wife at the time she received her inheritance, which still appear to be relevant in consideration of claims to excluded property. 

23 November 2016

Home is where the Heart (ache) is

My Colleague Jonathan M. Lazar recently led a panel discussion on the Family Home, at the   Collaborative Divorce retreat on November 18th.  It’s no wonder that the Family Home is one of the most difficult issues to settle in a family law file, when there are so many facets to consider.  Here is some of what Jon and the panel discussed. 


As most of us know, as house is not just a house, as lawyers we need to consider what it means for our clients, for their children, for the family as a whole.  There is certainly a stigma attached  to ‘losing the house’, so there needs to be great deal of thought given to how to deal with it in the context of a separation and divorce. 

OPTIONS – other than selling

There are many options other than selling the Family Residence, Jon and the panel listed a few including, sharing it (nesting) one spouse buying the other spouse’s interest, creating an income stream by renting out part of the house, one partner retaining an interest as an investment, asking a relative to move in or co own the home.  The panel discussed creative ways to re-finance including a blend and extend to lower payments and deferral of property taxes. 

CONSIDERATIONS  - legal and financial

In making a decision about the Family Residence, the panel acknowledged it isn’t all about affordability, the parties need to consider the welfare of the children, the ability of one party to physically maintain the property, new partners, the proximity of parents and children to each other, transit, and schools, as well as any special needs, the capacity to manage household debt and the ability of the other party to find affordable housing.  There are also the pets to consider, and whether one party has an emotional or historic connection to the house.  Are there mental health issues that need to be taken into account and what will be the financial impact of the timing of the sale? 

Lawyers also need to advise their clients about excluded property claims and claims for occupational rent should one party be living in the house while the other party is living on their own and paying their own accommodation expenses.  Lawyers need to discuss timing and listing of sale, as well as how to determine the value of the home if one party is buying out the interest of the other. Parties need to know how and when to change the locks, how to decide who gets what in terms of furniture, right down to the towels and the cutlery. These are things that can cause a heck of a lot of grief if not handled properly at the outset.  Some good advice is to tell people that it is not worth paying a lawyer to decide the value of your favorite couch which is probably worth almost nothing to anyone else. 

Lawyers also need to help parties come up with clear agreements about listing and sale of property so that the process is clear, and everyone knows what will happen if the house doesn’t sell within 90 days for instance, and the price has to be lowered. Agreements should be in place setting out the process for listing and selling, and what is happening with the sale proceeds, as well as a dispute resolution mechanism to deal with conflict when it arises, which it will.   

CONSIDERATIONS  - personal and emotional

The Panel also discussed the potential or perceived bias and loss that can be experienced by one party if they ‘lose’ the Family Residence.  How will it affect the children to see a parent move out of the home?  What are the implications for the parent moving out and what are the implications for the children? 


In terms of financial considerations, the panel discussed basic affordability and how to guide clients towards financial advisors who can give advice and help make good decisions.  Considerations included what tradeoffs would have to be made in order to be able to maintain the home as an investment.  How would each person’s budget be affected by the house purchase, and were there other options like downsizing?  The financial concern of course being that a person is making an emotional decision and committing themselves to an “all eggs in one basket” financial position which may or may not be in their best interests. 

As the list grows longer it’s easy to see why decisions about the Family Home are so difficult to make.  Thanks to Jon Lazar and the panel for a fascinating discussion. 
Karen F. Redmond, Family Law Lawyer


24 October 2016

New CRA Rules for Declaring Sale of Family Residence

A colleague brought this to my attention today and I thought it was worth sharing since in the context of family law and separation, the sale of the family residence is often an issue. 

CRA announced on October 3, 2016 that they had made administrative changes to the reporting requirements when it comes to sale of a principal residence.  Previously, if you sold your principal residence you did not have to report the sale on your tax return if you did not have to pay tax from the gain of the sale.  This would be the case if you were eligible for the full income tax exemption meaning that the residence was your principal residence for every year that you owned it.  Conversely, if you sold an investment property, you are required to report the sale and pay tax on the gain.  The new CRA policy says that starting in 2016, and retroactive to January 1, 2016, you are required to report the sale of your principal residence in order to claim the full exemption, and you need to provide information about when you bought it, the sale price and so on. 

More information can be found on the CRA website HERE

Karen F. Redmond