MacLean Law’s win of $100,000 monthly spousal support and $16,000 monthly child support for one child set the record for Imputed Higher Income For Child Support in BC.
Fraser MacLean, recently won an inputed income case for his delighted client where a husband saying he earned only $150,000 was found to have an imputed income of $1,000,000 pending a more through investigation at trial. The difference in income was significant and the award of spousal and child support won exceeded $30,000 a month.
But how did we do it? It takes hard work, lifestyle analysis, hidden cash and business income forensic investigations, document disclosure and even raids on office premises and seizing of documents and computers to lead to our big successes for our clients. Did you know every fake dollar of business deductions related to income of a spouse adds over $2.00 to their income. A lot of lawyers and clients don’t understand this and it has catastrophic consequences for them. If you have a wealthy partner and business owner who is playing games hire lawyers who deal with this daily and obtain justice. In today’s blog by Peter Graburn you will learn what the test for imputed income is.
Which Lawyers Win Big On Family Cases?
Imputed Higher Income For Child Support arguments are designed to protect the right of a child to share a proper standard of living after separation which is properly in line with what their parents earn. Hiring a law firm who knows how to find the truth, through lifestyle audits, job availability, skill and vocational analysis, hidden cash income and end run play defences, running expenses through companies and new partners etc. can help you and your children move forward successfully. We cannot allow paying parents to hide income or refuse to work to their capacity anymore than we can tolerate recipient spouses taking it easy at their children’s expense. If courts don’t stop slackers, then don’t we jeopardize Canada as a nation?
Vancouver Imputed Income Lawyers Tel: 604 602 9000
As set out in CLE BC
The test for imputing income for intentional under-employment or unemployment is one of reasonableness, having regard to a spouse’s capacity to earn income in light of their age, education, health, work history, and work availability. A spouse’s capacity to earn income will include that person’s ability to work or to be trained to work (Smith v. Smith, 2023 BCSC 991 at para. 80, citing Marquez v. Zapiola, 2013 BCCA 433 at para. 37). The imputation of income should not be the product of speculation or guesswork, and there must be evidence the parent is realistically capable of earning the income sought to be imputed based on an assessment of the above factors (Haley v. Haley, 2022 BCSC 1945 at para. 134, citing Marquez and other cases).
Our MacLean Law Vancouver lawyers won the highest BC spousal and child support award as follows:
See Devathasan v. Devathasan, 2017 BCSC 1010 at paras. 140 to 149, where the court applied the SSAGs to award interim mid-range spousal support to the recipient based on the payor’s income of approximately $2.8 million. On appeal, it was determined that this amount was too low, and it was ordered that the recipient be paid $100,000 per month for the period covered by the interim order.
Yes the MacLean Law winning award was $100,000 a month spousal and $16,000 a month for 1 child.
“Alberta is wrong; the rest of the Canada is right.” Tel: 403 444 5503
As we have repeatedly stressed in these articles, child support is the right of the child – both parents have a duty to financially support their dependent children, as they are able. How much child support each parent must pay depends on the number of dependent children they have to support, their parenting arrangement (ie. shared or primary care), and their incomes (usually based on Line 150 of their personal Income Tax Returns).
But as we have previously indicated in Calgary Family Business Imputed Support Income, what if either parent doesn’t disclose their income, or claims they have no income, or that they are unemployed? What if the payor spouse isn’t earning income to their full earning capacity or potential (ie. is “intentionally unemployed or under-employed”, particularly after separation) in order that they do not have to pay more (or any) child support? This situation calls for the imputation of income for child support purposes.
Calgary Imputing Income for Child Support Purposes Tel: 403 444 5503
For child support purposes, section 19(1)(a) of the federal and provincial Child Support Guidelines (the “Guidelines”) provides:
19(1) Imputing Income – The Court may impute such amount of income to a spouse/parent as it considers appropriate in the circumstances, which circumstances include the following:
the spouse/parent is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage/parents, or any child under the age of majority or by the reasonable educational or health needs of the spouse/parent;
Simple? Perhaps not so much. Fortunately, over the years, the Courts (particularly in Alberta, the Alberta Court of Appeal) have weighed in to interpret s. 19(1)(a) of the Guidelines, specifically the “intentionally under-employed or unemployed” provision.
The law on this provision in Alberta was originally set out in the 2001 Alberta Court of Appeal case of Hunt v. Smolis-Hunt (2001 ABCA 229), which held that for the Court to impute income, the recipient spouse/parent had to prove that the paying spouse/parent was “intentionally under-employed or unemployed” for the deliberate purpose of evading or defeating (ie. avoid/lessen) paying the child support obligation required under the Guidelines (the “deliberate evasion” test) (Picard JA dissenting, holding it should be a “reasonableness” test). The Alberta Court of Appeal confirmed the “deliberate evasion’ test as late as 2017 when it held (in Keating v. Keating, 2017 ABCA 428 at para. 11) that the conduct of the payor spouse/parent and overall circumstances of the situation must permit the inference that the payor took unreasonable actions to undermine or avoid their child support obligations.
Vancouver Imputed Higher Income For Child Support Tel: 604 602 9000
For over 20 years, the Alberta Court of Appeal position regarding the test to be applied in determining whether a payor spouse/parent was “intentionally under-employed or unemployed” for imputing income under s.19(1)(a) of the Guidelines (the “deliberate evasion” test) stood in sharp contrast to the position uniformly taken by Courts in other provinces (the “reasonableness” test), who often openly criticized the more stringent, ‘personal freedom’ (re choice of career) nature of the Alberta position (see: Calgary Support Underemployed Income Imputation, https://macleanfamilylaw.ca/2018/10/22/calgary-support-underemployed-income-imputation ).
Alberta Gets In Line On Imputed Income
Until recently. In 2022, in the case of Peters vs. Atchootay (2022 ABCA 347), the Alberta Court of Appeal reversed their position previously taken in Hunt and Keating, replacing the “deliberate evasion” test with a “reasonableness” standard and placing the onus on the payor parent to prove (with significant supporting evidence) the reasonableness of their income decisions (ie. chosen lifestyle), thus coming in line with the Courts in the other Canadian provinces.
In Peters (at para. 60), the Alberta Court of Appeal set out a new, simple 3-part test for imputing income under s. 19(1)(a) of the Guidelines, being:
- Is the parent in question intentionally under/unemployed [ie. is the under/unemployment within their control or not (temporary or permanent layoff, termination, etc.)]?;
- Do the listed exemptions to imputation in s. 19(1)(a) apply (ie. needs of children, reasonable educational or health needs of the parent, etc.)?, and;
- Should Judicial discretion to impute income be exercised (ie. whether the voluntary under/unemployment was reasonable, having regard to all the circumstances).
The Court of Appeal (at para.’s 92 and 93) also reviewed and set out a “non-exhaustive” list of the guiding principles as to whether to impute income under s. 19(1)(a), being:
- Parent have a general duty to work when they are healthy and can work;
- A parent’s earning capacity is used to assess reasonableness in the circumstances;
- The Court has discretion to impute or not impute income is situations they find is reasonable to make that choice;
- The obligation to support children is the overarching goal;
- Any agreements between the parties contextualize reasonableness in those circumstances;
- Reasonableness is not fixed in time and can change as the circumstances do, and;
- The ultimate onus rests on the party resisting imputation.
Imputing Income For Child and Spousal Support Tel: 403 444 5503
Perhaps as importantly, the Court of Appeal acknowledged it had been the outlier in maintaining its position to support the “deliberate evasion” test rather than the “reasonableness” test maintained in other Canadian provinces for so long, stating (as per Pentelechuk J.A, at para.’s 41 – 42):
“It is time to replace the deliberate evasion test established by the decision in Smolis-Hunt. As signalled by Picard JA’s dissent, a test of reasonableness should govern the court’s discretion to impute income under s. 19(1)(a)… Alberta is the only province in Canada requiring evidence of an intention to evade or undermine child support obligations before income can be imputed. Appellate courts of other provinces have endorsed the reasonableness test. Alberta is wrong; the rest of Canada is right.”
Wow. It’s not often a Court will acknowledge they were “wrong”. But this only goes to support the importance of the principle in family law that child support is the right of the child and, reciprocally, that both parents have a duty to financially support their dependent children as they are able over and above their personal goals and lifestyle choices. As stated in Peters (at para. 71):
“A parent’s personal goals and life-style choices do not take priority over their obligation to financially support their children. It is recognized that for many who work, it provides more than a livelihood; it provides a sense of identity, self-worth and well-being. However, the Guidelines and the Divorce Act direct that children be shielded from the negative impacts, financial and otherwise, of separation and divorce. As has been repeatedly recognized by this Court and the Supreme Court of Canada, parents have an obligation to support their children financially. Child support is the right of the child and cannot be bargained away by the parents.. “The Guidelines regime is decidedly child-centered” in recognition of that right… “
How do you help you and your children win on spousal and child support based on the real income each party can earn? Hire lawyers who do this daily and in the biggest cases. Imputed Higher Income For Child Support are important to you and other spouses who need to proetect their children.
