Transcript Powerpoint, July 15, 2014

July 15, 2014
Carol Rogerson
Rollie Thompson
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History
How the SSAG were created, current status
Appeal decisions
Current SSAG issues
SSAG successes, problems
Spousal guidelines internationally
Materials:
◦ Appeal Decisions 2010-14
◦ “Canada’s Experiment” 2011 FLQ article
◦ “Ideas of Spousal Support Entitlement”
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Early Research (2001-2002)
Background Paper (December 2002)
Sneak Preview (July 2004)
Draft Proposal (January 2005)
Immediate use, software available
Appeal Court Decisions: BCCA August 2005,
NBCA April 2006, ONCA January 2008
Detailed Feedback in 2006-08
Revised Final Version (July 2008)
New and Improved User’s Guide (March 2010)
Monitoring for New Developments by DOJ
Software updates taxes, etc.
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Not legislated, informal
National: divorce and other support claims
Ranges for amount and duration,
threshold entitlement determined first
Formula ranges for “typical” cases,
note exceptions and departures
Formulas reflect dominant patterns
Sophistication required, complex issues
Software necessary for most cases
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Experience with Child Support Guidelines
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SCC in Bracklow (1999) confused us
◦ Widely viewed as success
◦ Familiarity with income-based guidelines
◦ No guidance on amount, duration
◦ Rogerson, Thompson papers in 2001
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Outcomes inconsistent, unpredictable
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Federal Justice commitment
◦ Frustration of spouses, Bar, bench
◦ Desperate for guidance
◦ Advisory, professional
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To reduce conflict, encourage settlement
To create consistency and fairness,
more predictability, thus legitimacy
To reduce legal costs, improve efficiency of
process
To provide a starting point for solutions in
CDR/CFL/mediation/settlement confs.
To provide basic structure for further
judicial elaboration in decisions
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Background Paper (December 2002)
SSAG Final Version (July 2008)
New & Improved User’s Guide (March 2010)
(2014 updated version forthcoming)
(2009), 28 Can.Fam.L.Q. 193 (SSAG issue)
(2011), 45 F.L.Q. 241 (materials)
Website:
library.law.utoronto.ca/spousal-supportadvisory-guidelines
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Final Version (2008) still applies
Monitoring: no major changes since 2008
Software adjusts for tax, benefit changes
New User’s Guide (spring 2015)
will reflect recent judicial decisions
new patterns can emerge
Look to decisions, trends in other provinces
◦ Smaller provinces look to BC, ON for e.g.s
◦ Less-SSAGish provinces look to SSAG provinces
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BC, NB, ON, PEI: appellate endorsement
NL, SK, MB: extensive use at trial
NS, AB: wide,erratic use, appellate confusion
QC: just beginning, 2011 QCCA decision
180+ CA decisions: BC 83, ON 32, AB 23,
NB 15, NS 9, MB 6, QC 8, MB 6, PEI 1, NL 1
2400+ trial decisions: BC 857, ON 801,
AB 157, NS 153, SK 133, NB 104, NL 68,
MB 56, QC 53, Terr. 16, PEI 7
No SCC decision: leave denied 7 times
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Fewer interesting appeals since 2012
Older appeals cited, e.g. Fisher, Chutter
BCCA: 9 of19 appeals raised “imputing” issues
◦ E.g. PRM, Brandl, Kouznetsova, Shen, KD, Marquez
ONCA: Reisman, 10-year time limit struck,
indefinite after 20-year marriage
MBCA: Kynoch, cautious re SSAG use,
amount increased, but still below range (?)
QCCA: similar to Kynoch, 2011 QCCA 1554
NBCA: Smith (2011), no “error” not to use SSAG,
but reasons required, then mid-SSAG ordered…
Focus today on SSAG, but not:
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Threshold/no entitlement
Spousal support agreements, Miglin
Variation, material change after LMP v LS
Income determination mechanics
Retroactive spousal support
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SSAG only AFTER entitlement established
Social assistance (incl. ODSP) is NOT income
Include any pre-marital cohabitation
Always consider s. 7 expenses BEFORE SSAG
Discount lump sum for non-deductibility
Know how outcomes calculated!
Be transparent about assumptions, esp.
income
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Fewer “ordinary” cases reported,
more settlements
Twice as many with child support cases
as without child support, but demographics
Income determination now central issue
More attempts to “impute” income…
Default to mid-range on amount
Generally consistent on duration
Interprovincial differences re review orders
Reviews vs long time limits?
Exceptions still under-used
Mid is not “norm”, factors to consider:
 Strength of compensatory claim
 Recipient’s needs
 Age, number, needs of children
 Needs, ability to pay of payor
 Work incentives for payor
 Property division, debts
 Self-sufficiency incentives for recipient
Good e.g.s: Reid v Carnduff (ONSC 2014); Mayer
(ONSC 2013); Brown (NBQB 2013); Cochrane (BCSC
2013); Jardine (NSSC 2013); Hari (ONSC 2013);
Bastarache (NBQB 2012); SD v JD (NBQB 2012)
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Beyond threshold, identifying entitlement still
important; compensatory vs non-compensatory
Location in ranges
Exceptions, variation issues
Duration: end of entitlement
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Compensatory issues:
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Non-compensatory issues:
◦ “She was a secretary before, so no loss”…
◦ “She worked throughout the marriage, so no loss” …
◦ “He received no career advantage because she stayed home
with the kids” …
◦ good compensatory analysis: Hartshorne (2010 BCCA),
Abernethy v Peacock (ONSC 2013)
◦ “need” as a ceiling vs. marital standard of living in long
marriages
◦ post-separation need?: Tscherner v. Farrell (ONSC 2014),
Jubinville (BCSC 2013)
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Divorce Act, s. 15.2(6)(a) and (b)
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Economic disadvantage/advantage, roles
Markers:
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Implications:
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home with children full or part-time
primary care of children after separation
secondary earner
moves for payor’s career
support for payor’s education/training
work in family business
◦ strong compensatory claim, higher in the range
◦ more likely to share post-separation income increases
◦ less impact of repartnering
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Divorce Act, s. 15.2(6)(a), (c)
Needs-based, “merger over time”
Need relative to marital standard
Markers:
◦ length of marriage/cohabitation
◦ drop in standard of living
◦ economic hardship
All to assess “interdependence”
Implications:
◦ assess usually on separation date incomes
◦ lower in range, but disability/extreme need often pushes
higher
◦ more impact to repartnering
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Many reported decisions
SSAG often used, “ideal setting”
But remember: exception for compelling financial
circumstances in interim
◦ SSAG amount may be too high; eg payor responsible
for debts, mortgage, etc: Fyfe v. Jouppien (ONSC
2011); Carrier v. Poon (NBQB 2013)
◦ SSAG may be too low, hardship, eg. short marriage,
no kids: Singh (ONSC 2013)
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Complex incomes, lack of accuracy: choose a
number, can correct at trial
Include interim in calculating duration
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One third of reported cases, except half in NB, NS
Wide range of cases, mix of compensatory and noncompensatory entitlement
◦ short, medium, long, no kids
◦ long with grown children
◦ medium length, wcs at time of separation, cross-over when
cs ends
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Exceptions more relevant in these cases
Court cases within formula range for amount 60% ON
to 70% BC (90% in NB)
◦ but many fall within exceptions (noted or not noted)
◦ unusual facts
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Duration often involves time-limits
◦ think about restructuring, lump sums
◦ indefinite with variation/review vs. long time-limits
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20 yrs or more
Majority of without child support ct. cases
Spousal support mixed with property
issues, complex incomes
Duration generally indefinite in initial
orders, not even many reviews (except BC)
Main issues on variation/review
◦ changing incomes, self-sufficiency
◦ repartnering, retirement
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0-9 yrs (similar issues for custodial payor)
Formula: low amount, short duration
Most settle: interim enough, time limit, lump sum
Few reported cases: atypical, formula result
seems unfair (too low, too short)
Remember relevant exceptions!
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Compensatory exception in short marriages
Compelling financial circumstances in interim
Hardship in short marriages
Immigration sponsorship
Good examples: RMS (BCCA 2011), Stergios v. Kim
(ONCA 2011), Singh (ONSC 2013)
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10-19 yrs
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Issue is duration: formula generates time-limits;
how to implement?
◦ medium length, no kids (non-compensatory)
◦ medium length with kids, cross-over to wocs when child
support ends (compensatory & non-compensatory)
◦ many indefinite to begin, then short time limits/termination
imposed on variation/review: Domirti (BCCA 2010, crossover, terminate16 yrs after 16 yr marriage)
◦ but some longer time limits in advance, Maher (NBQB
2012), Zimmaro (BCSC 2013)
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Most cases within ranges for duration: SSAG
bringing structure to duration in medium length
marriages
◦ high end of duration range in compensatory cases (crossovers); lower end of duration range (half length of
marriage) in many non-compensatory cases
◦ disability may be an exception, no time limit: Leblanc
(NBCA 2013), Van Rythoven (2010 Ont.Div.Ct. 2010)
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Remember, when child support ends, need to
switch to without child formula for spousal
support; retro calculations as well as ongoing support
◦ Maher (NBQB 2012), Purgavie (ONSC 2012)
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Duration: may now be time limits
Remember s.15.3 exception, inadequate
compensation, priority to child support
◦ Beck v. Beckett (ONCA 2011), Abernethy v. Peacock
(ONSC 2013)
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Leading case on when to use: Davis v. Crawford
(ONCA 2011)
Lump sums based on SSAG, need time limits for
duration; most often short, medium length
marriages without children
If converting periodic to lump sum remember to
discount for tax
Issue: additional 20% contingency discount in BC?
Marsh (BCSC 2012), Walker v. Brown (BCSC 2013)
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In many cases, multiple purposes, no calculations
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Fewer “basic” formula cases, 45-55%
more complex custody cases now
shared custody, esp. in BC (30% of cases)
custodial payor, esp. in Ont (20%)
90% fall within range for amount
mid-range for 60% of outcomes
Duration generally consistent with SSAG,
except short marriages, young children
More homogenous than without child cases
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Problem of duration, not amount
Compensatory claims:
◦ Young children, disproportionate care
◦ More future disadvantage, than past
◦ Judges, lawyers underestimate loss
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Do NOT tie duration to length of marriage
◦ Persistent pattern across provinces
 E.g. MacKenzie v Perestrelo (BCCA 2014)
◦ Age of children test more important
◦ Reviews rather than short time limits
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Large income disparities common (!)
Most fix child support at set-off
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Trend to equalise NDIs in Ontario, not BC
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◦ Spousal support used to adjust living standards
◦ E.g. Rankin (ONSC 2014); McMahon (BCSC 2012)
◦ BC most mid or low-end SSAG?
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Thompson (2013), 32 CanFLQ 315
Similar household living standards as guide
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SSAG range always includes 50/50 NDI split
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Duration can be important in these cases
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◦ Using child support, spousal support
◦ In bi-nuclear cases, starting point…
◦ In complex families, can use Schedule II adjusted
◦ Reduced disadvantage going forward
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Hybrid, i.e. at least 1 child shared
◦ Child support at set-off, spousal to adjust
◦ With child support formula, mostly mid-range
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Split custody
◦ Not equalise NDIs: Greig (ONSC 2014)
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Step-children:
◦ With child formula, often hybrid custody
◦ Trade-off vs child support, Stadig (ONSC 2013)
◦ If only step-child, length of marriage re duration
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More frequent: NB 23%, ON 20%, BC 10%
Leading case: Cassidy v McNeil (ONCA 2010)
Compensatory vs non-compensatory?
When? older children, disability, guys
Papasodaro (ONSC 2014): formula “harsh”?
◦ But reflects cost of children, length of marriage
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Generous time limits, also indefinite
◦ Medium-to-long marriages
Note: is child support being paid or not?
Exceptions? disability, parenting?
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Used more frequently, but still missed:
Read Chapter 12!
Most common?
debt, interim, disability, hardship
prior support, s. 15.3
Used more in without children cases
Driven by entitlement analysis,
also practical adjustments
11 exceptions in all, not exhaustive
Unusual facts mean departures
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Compelling financial circumstances at the
interim stage (SSAG 12.1)
◦ Singh (ONSC 2013); Tasman v. Henderson (ONSC
2013); Fyfe v. Jouppien (ONSC 2011); Carrier v. Ponn
(NBQB 2013)
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Debt payments (SSAG 12.2)
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Illness and disability (SSAG 12.4)
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Prior support obligations (SSAG 12.3)
◦ Dunn (ONSC 2011); Goodine (NSSC 2013)
◦ Powell v. Levesque (BCCA 2014); Shen v. Tong (BCCA
2013); Leblanc (NBCA 2013); Van Rythoven
(Ont.Div.Ct. 2010); Tscherner v. Farrell (ONSC 2014);
Knapp (ONSC 2014)
◦ Newcombe (ONSC 2014)
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Compensatory exception in short marriages
without children (SSAG 12.5)
◦ R.M.S. v. F.P.C.S. (BCCA 2011); Stergios v. Kim (ONCA
2011); Singh (ONSC 2013); Sidhu (ONSC 2014); Bhandal v.
Mann (BCSC 2012)
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Basic needs/hardship (SSAG 12.7)
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Non-primary parent to fulfil parenting role (SSAG
12.9)
◦ Singh (ONSC 2013)
◦ R.M.S. v. F.P.C.S. (BCCA 2011); Kelly (BCCA 2011); Osanlo v.
Onghaei (ONSC 2012)
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Special needs of child (SSAG 12.10)
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Section 15.3: inadequate compensation (SSAG
12.11)
◦ Jans (Alta.Prov.Ct. 2013); Metzger (ONSC 2011)
◦ Beck v. Beckett (ONCA 2011); Abernethy v. Peacock (ONCJ
2012)
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NOT a “cap”, just “ceiling” on formulas
Discretion once beyond $350,000
◦ ON, BC more likely to follow formula than MB, SK
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Incomes closer to $350,000:
often low to mid formula range
incomes up to $500,000
Incomes above $500,000: “pure discretion”
Shorter marriages, more modest amounts
Large child support: moderate spousal?
Run various incomes, from $350,000 on up
To vary, proof of “material change” required
 Review: court can make term of order,
reconsider after date/event, if uncertainty
 SSAG formulas apply on variation, review
But hard entitlement issues creep in…
 Post-separation income increase
 Remarriage/repartnering of recipient spouse
 Self-sufficiency of recipient
 Retirement of payor
So greater discretion in use of SSAG
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Entitlement issue:
share all, some or none of increase
Test: loose connection of increase to
marriage:
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length of marriage
roles during marriage (compensatory/non-comp)
time elapsed since separation
reason for increase
together/support while education/training
AB more demanding, less so ON, BC
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Run alternative incomes, different sharing
Most likely to be shared:
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Delayed support claims:
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◦ with child support cases
◦ compensatory claims generally
◦ medium and longer marriages
◦ “SSAG don’t apply”: wrong
◦ E.g. Quackenbush (ONSC 2013)
◦ real issue incomes to be used, living standards
Flip side: post-separation reduction of
recipient’s income, e.g. job/pay loss
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Issue of entitlement: its end
Initial time limits:
◦ without child support, custodial payor formulas
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Time limits over time: both formulas
Self-sufficiency: common reason
Other reasons for ending entitlement:
repartnering of recipient
retirement
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No formulaic adjustment
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Alternatives to adjust:
◦ No automatic termination
◦ Entitlement compensatory or non-compensatory?
◦ Support continues longer, bigger if former
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None (if compensatory, or partner low-income)
Low end SSAG range
Step-down order
Below formula range
Nominal support (in case)
Termination/no entitlement
Need for “more guidance”: Colley (ONSC Quinn J)
See K.A.M. v P.K.M., 2010 BCSC 93
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Relative concept, to marital standard
No “deeming”, realism needed: Moge
A factor, not determinative: Leskun
Methods of encouraging:
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Impute income to recipient: most common
Increase support: education/retraining
Review, or another review
Reduce support/step-down: need to earn more
Terminating review order
Time limit
Dangers of double-counting
◦ e.g. impute and low end, or impute and step down
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Retirement usually a “material change”
Early retirement: may not be “change”
Reduced income, SSAG to reduce support
Division of property/pension important
Boston (SCC 2001):
◦ no double-dipping of divided pension
◦ but broad exception for need
◦ both spouses to use assets to generate income
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Entitlement often ends…
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SSAG formulas are gender-blind
Less bias: NB, ON, BC…
E.g. Walker v Brown, 2013 BCSC 204
More cases
Still unspoken “exception”?
No entitlement, lower amount,
shorter duration
Higher expectations of self-sufficiency
Firth v. Allerton (ONSC 2013):
bad arguments, low and short!
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Shaping client expectations
Framing negotiations
More settlements, less litigation
Simplifying resolution of typical cases
◦ Smaller claims resolved, basic without child formula
Access to justice, esp. unrepresented
More structure for duration
Calculating lump sums
Isolating outlier decisions/patterns
Gender neutrality
Fewer “bad” agreements
Establishing a standard for appellate review
Providing structure for support analysis
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Skipping over entitlement
Defaulting to the mid-range on amount
Duration too short where young children
Failing to consider exceptions
Unsophisticated use generally
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Seeking rules where SSAG leave discretion
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◦ Attempts to impute income
◦ Defaulting to formulas for high incomes
More frequent claims for retroactive support
Unrepresented litigants:
◦ But now MySupportCalculator.ca
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Local guidelines, mostly temporary
◦ E.g. Santa Clara, Fairfax, Penn, Kansas
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American Law Institute (2002)
Am. Ass’n of Mat. Lawyers (2007)
Mass (2011), NY (2010, temporary,…)
Other states
UK Law Commission Report (February 2014)
“Matrimonial Property, Needs, Agreements”
recommends working group re formulas