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Divorced dads lose in SCC ruling on child support

Updated Mon. Jul. 31 2006 11:28 PM ET

CTV.ca News Staff

Canada's Supreme Court has ruled ex-spouses could face hefty retroactive child support payments if they fail to declare increased earnings -- a decision that could affect thousands of divorced and separated couples across the country.

The ruling was unanimous: 7-0. The top court decided that ex-spouses -- the fathers in most cases -- who pay support have an obligation to report increases in income which could therefore boost their court-ordered payments.

"Parents have an obligation to support their children in a way that is commensurate with their income," said Justice Michel Bastarache, writing the main opinion.

"A payor parent who does not increase his-her child support payments to correspond with his-her income will not have fulfilled his-her obligation to his-her children."

The court also ruled that former spouses should be hit with retroactive penalties if they fail to inform their ex-partner about any changes to their income. The rough guideline is that penalties should not stretch back more than three years, said Bastarache.

The court left the door open for lower courts to decide on those payments on a case-by-case basis.

At issue were four cases before the Supreme Court, in which two women succeeded and two failed in their initial demands to receive an increase in monthly payments.

The Alberta Court of Appeal subsequently awarded all four women increased payments and the four fathers were ordered to make retroactive payments which ranged from $10,000 to $100,000.

Dee Smith, lead counsel for the four fathers, said the men in no way objected to the original court decision regarding their child support payments.

"What they objected to was the part of the Alberta Court of Appeal decision that said that they should have known, even though the law isn't clear, that they annually disclose their income and annually increase the child support they've been paying," Smith told CTV's Canada AM Monday.

"That's a very dramatic change in the landscape for child support. Those families are going to be basically scurrying trying to figure out what child support should have been paid over the course of the last decade."

Smith said the Supreme Court's decision could have far-reaching implications for many families.

"We think that something in the range of 700,000 families could be affected by this decision. It has the potential to have an enormous financial impact on an enormous number of Canadians."

Child support guidelines

The ruling could lead to policy repercussions for the federal government, which last revamped the federal Divorce Act in 1997 to establish guidelines for child support.

The aim was to bring some order to a notoriously uneven system in which support orders varied wildly from case to case.

The new regime established a grid system that tied the amount of support to the ability to pay and the number of children, but enforcement turned out to be a problem, partly because of income fluctuations as people lost old jobs and took new ones in the years following the break-up of their marriages or common-law relationships.

"We're talking about separated families, not people who are great at problem-solving," Smith continued.

"It's usually when something else is happening that the support issue gets intertwined."

In the four Alberta cases, Smith said the fathers dutifully paid everything they owed under the initial support orders made by the courts when they divorced or separated.

However, Carole Curtis, the lawyer for two of the four women receiving support payments, said although the men stuck to the original deals, they did not tell their ex-partners their incomes had gone up and they could now afford to pay more under federal guidelines.

"They were paying the wrong amount, and they knew they were paying the wrong amount," she told CP.

When Parliament adopted the grid system nine years ago, there was talk of setting up a federal-provincial enforcement mechanism that would combine income tax data with custody information and automatically update support payments every year.

But the system was never established, in part because Ottawa and the provinces couldn't agree on how to finance it.

Instead, the federal government set up four "pilot projects" across the country that have yet to lead to a national enforcement scheme.

That has effectively left the onus on women who think they're being shortchanged to go to court and demand an increase in support payments.

It's a burden many choose not to bear, said Curtis.

She argues that, unlike men, "women aren't socialized to enjoy the fight. They're socialized to want to end the fight."

For Natalie Hegedron, who raises two girls on less than $500 in monthly child support, fighting for more money is too overwhelming.

"It's a long process," she says. "Just having to ask is one thing and then it just escalates, having to go see a lawyer... the fighting and arguing does not help.

In contrast, Angelo Perra has been fighting with his ex-wife for years over the $1,700 that he now pays in child support payments. After starting a second family, the contractor says his income fluctuates and he can't afford the hefty payments.

"How do you know the custodial parent is actually putting that money toward the child?" says Perra.

With files from CTV's Graham Richardson and The Canadian Press