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Tookenay v. Laframboise, 2015 ONSC 2898

In this case, the court must determine whether a payor parent’s monthly annuity from a structured settlement in a personal injury action should be imputed as income for child support purposes.


The mother and father separated after seven years and have two children. The father pays child support. As an infant, the father was injured in a car accident and received a structured settlement that guarantees him a monthly payment for his lifetime, which at the time of trial was $2,221 per month.

Aside from that monthly annuity, the father earned seasonal income working as a laborer or collected unemployment insurance benefits during the off-season. The mother worked part time.

Relying on Rivard v Hankiewicz and Fequet v Fequet, the mother argued that the court could impute income from a structured settlement. As such, she sought to have all or part of the monthly payments imputed as income to the father to determine the proper amount of child support. She asserted that imputation was appropriate as the funds were regularly used to cover the family’s needs.

The father argued that, because the structured settlement annuity was entirely general damages for pain and suffering and lacked a pecuniary component, no part of it should be imputed as income to him. Accordingly, he asserted that his child support payments should be based entirely on his income from employment and unemployment insurance.


According to Rivard, where the respondent payor also received a settlement annuity, the payor had “an obligation to provide the court with evidence regarding his annuity that may be required to allow a reasonable determination of whether the payments are income of the guidelines in whole or in part.”

The Court in this case found that since the settlement documentation indicated a claim for future loss of income or loss of earning potential, the settlement did include a component to compensate for the father’s loss of earning potential.

Summarizing Rivard, the Court noted that

“…income has been imputed from structured settlements when a portion of the settlement funds has been allocated to future economic loss. In those cases, only the component for future economic loss has been imputed as income. In other cases, where there has been no allocation between various heads of income, courts have imputed income without reference to amounts paid in settlement.”

Looking to Rivard and Fequet, the Court concludes that it was appropriate to determine the use of annuity funds in determining whether the annuity should be imputed as income. It is appropriate to impute such funds as income if they are used for ordinary living expenses and not rehabilitation or other medical expenses relating to the accident.

Here, the father did not provide any evidence as to whether there was any significant or ongoing care or medical expenses as a result of the childhood accident.

Since the family’s income came primarily from part-time work and unemployment insurance, the father’s monthly annuity constituted a significant portion of the family’s income and was used to pay their living expenses. As they relied heavily on the monthly annuity when their income was insufficient for their needs, the Court concluded that the funds were used for ordinary family expenses.

Therefore, the Court ruled that it was appropriate to impute 50% of the monthly annuity as income to the father, given that at least 50% of the settlement would have been allocated to non-pecuniary damages for pain and suffering. Additionally, because the annuity was received tax free, the portion imputed as income needed to be grossed-up to determine the correct child support guideline amount.