The best imputed income support lawyers in Calgary are pleased to see a new decision bringing Alberta imputed support principles into line with the rest of Canada. In today’s blog, Brianne Beckie of our Calgary office explains what the Best Imputed Income Support Lawyers tips are for child and spousal support cases.
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In a landmark case by the Alberta Court of Appeal, Peters v Atchooay, 2022 ABCA 347 [Peters v Atchooay], the Court has changed the approach to imputing income for the purposes of child support. Peters v Atchooay is a case where the Respondent (payor father) sought to reduce child support on a retroactive basis due to a significant reduction in income. The previous approach to imputing income, known as the “deliberate evasion test”, which came from the case, Hunt v Smolis-Hunt, 2001 ABCA 229 [Smolis-Hunt], has been replaced with a reasonableness test that asks three fundamental questions:
- Is the parent in question intentionally under-employed or unemployed?
- Do the listed exceptions to imputation of income in section 19(1)(a) of the Federal Child Support Guidelines (the “Guidelines”) apply?
- Should judicial discretion to impute income be exercised?
Each of these questions will be examined in further detail, below.
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In British Columbia the test for imputed income does not require bad faith. In Vancouver and BC, Imputing income for underemployment does not require a finding of bad faith on the part of the payor or deliberate avoidance of child support responsibilities, but only that the payor is not earning to capacity.
The Vancouver best imputed income support lawyers understand that in order to determine if a parent is earning to capacity, the following considerations must be taken into account: that parent’s age; education; experience; skills; health; and the job opportunities reasonably available. Persistence in unremunerated employment will not be regarded as an excuse. Similarly, a self-induced reduction in income does not justify the avoidance of child support obligations.
Conversely, Alberta until recently used a far higher threshold test before income would be imputed to a spouse involved in a child or spousal support dispute. This new change to the law in Alberta regarding income imputation is long overdue, as Smolis-Hunt was decided 21 years ago. Alberta is now in line with the rest of Canada on this issue. All other provinces in Canada employ a reasonableness test when it comes to determining whether or not a parent is intentionally under-employed or unemployed. This change comes as welcome news to those who have been convinced that their former spouse or partner has been advertently evading child support, but were unable to prove it. Smolis-Hunt – perhaps unfairly – placed the evidentiary burden on the recipient of child support to prove the payor’s intent to evade child support.
For a general explanation of how imputed income works across Canada in spousal support and child support cases please see the Revised SSAG.
Reconsideration Of Past Alberta Imputed Income Support Law
In MacDonald v Brodoff, 2020 ABCA 246, the Alberta Court of Appeal had invited an application for reconsideration of its long-standing precedent, namely Smolis-Hunt, which held that in order to impute income to a payor under section 19(1)(a) of the Guidelines, there must be “proof of a specific intention to undermine or avoid support obligations, or circumstances which permit the Court to infer that the intention of obligor is to undermine or avoid his or her support obligations”: Smolis-Hunt at para 42. The decision in Peters v Atchooay marks a historic change to Alberta’s law with respect to imputation of income.
Reasonableness Test For Imputing Income
Before going any further, it should be noted that the underlying principle of section 19(1) of the Guidelines is to ensure a fair level of support for the child. The reasonableness test is in line with the recent changes to the Divorce Act (Canada), which focus on the best interests of children.
Picard JA, in her dissent in Smolis-Hunt, summarized her rationale for the reasonableness test in this way:
Given the fundamental responsibility of parents to support children, it is enough to prove that the payor has capacity to earn more than he or she does but does not do so based on a choice that is unreasonable in the circumstances [emphasis added].
The analysis in the new Peters v Atchooay requires consideration of the autonomy of the payor parent to make fulfilling employment decisions versus a fair level of support to child, where fairness to the child is paramount.
The first of the three fundamental questions involved in the reasonableness test asks: Is the parent in question intentionally under-employed or unemployed? A person is “intentionally under-employed” for purposes of section 19(1)(a) of the Guidelines where their income is less than they are capable of earning. This does not mean that an income should be imputed to every parent who does not meet their earning capacity. However, the payor parent must prove, on a balance of probabilities, that their career decision, which led to a reduction in income, was reasonable in all of the circumstances.
The second of the fundamental questions asks: Do the listed exceptions to imputation of income in section 19(1)(a) of the Guidelines apply? The exceptions to imputation of income in section 19(1)(a) of the Guidelines apply where the under-employment or unemployment is required by:
- the needs of a child of the marriage or any child under the age of majority; or
- the reasonable educational or health needs of the spouse.
What Type Of Underemployment Counts?
The last question is: Should judicial discretion to impute income be exercised? The question of whether to impute income (and if so, how much) involves determining if the voluntary under-employment or unemployment was reasonable in the circumstances, including the financial circumstances of the children. The Court will consider the degree to which child support would be reduced as a result of the decision or conduct of the payor parent, but it will also consider the effect of the reduction on the children.
This summarizes the appellate decision in Peters v Atchooay. This landmark decision will have an impact on the cases of many parents who are going through separation and divorce. Guidelines income disputes are common in family law matters, and can have a significant impact on child support obligations. Contact MacLean Law to find out from one of our Income Imputation Lawyers how this precedent-setting case affects you and your children.
Call our imputed spousal support lawyers early on in your case if you have questions on support and want the Best Imputed Income Support Lawyers strategies.