B.S. v. B.W., 2019 ONSC 2769: Determining Spousal Support When the Payor Has a Post-Separation Increase in Income

In B.S. v. B.W., the court was tasked with determining whether ongoing spousal support was owed to the wife, and, if so, whether the lump sum cash payment received by the husband from his pension after the separation should be considered as income for support purposes.

Background

The parties were married for 24 years and separated in 2009. The wife had been the primary caregiver of their four children for 15 or 16 years of the marriage, while the husband travelled frequently for work. However, after the separation, the husband experienced a change in employment that caused his income to double.

The parties executed a Separation Agreement in 2010 and an Amending Agreement in 2011, which clearly outlined provisions for review of spousal support and ongoing exchange of financials. From 2009 to 2016, the parties consistently followed the terms of the Separation Agreement and Amending Agreement while adjusting spousal support payments to reflect changes in both parties’ respective incomes over time.

Averaging the varying amounts of spousal support from January to June 2017, the husband paid approximately $2,900 in spousal support per month. He unilaterally reduced support to $2,000 in June 2017 and then $1,400 in January 2018. In 2017, the husband took a buyout of his pension, which amounted to approximately $1.4 million, and distributed it between a cash payout and a locked-in retirement vehicle.

In May 2018, the husband requested a termination of spousal support, while the wife sought an increase in spousal support, effective June 1, 2018.

Analysis

The court concluded that spousal support should not be terminated. During the 24-year marriage, the husband’s career was supported by his wife’s role as the primary caregiver for their children. The spousal support had not continued long enough, so the wife’s compensation claim remains strong. The court determined that the husband’s increase in income post-separation should be considered for the calculation of spousal support because he continued in the same type of career he was in throughout the relationship.

With respect to the lump sum payment received by the husband from his pension, the court further determined to utilize the approach from Halliwell v. Halliwell of selecting a mid-point between the $350,000 ceiling under the Spousal Support Advisory Guidelines (SSAGs). The court stated that in applying this approach, the husband’s income in 2018 was $607,928, a midpoint between the $350,000 ceiling and $865,856 (full imputed income). The judge determined that support at the low-end of the SSAGs range is fair and properly addresses the factors to be considered under the Divorce Act and in section 15.2(4) and (6). The low end of the recommended range suggests spousal support payments of $15,742 per month, based on the husband’s 2018 income and the wife’s income of $84,331, which the court ordered the husband to pay starting June 2018. The husband is to pay $8,000 per month in spousal support based on an income of $354,286 from June 2019 onwards.

The parties are ordered to exchange income tax returns annually thereafter. The court noted that the wife’s re-partnering after separation does not impact the outcome of this case, as “it is not the new partner’s obligation to shoulder the effects of someone else’s long-term marriage and separation” and the choices and roles that were involved. Ultimately, the court dismissed the husband’s motion to terminate spousal support and granted the wife’s motion for an increase in spousal support.

Do You Require a Spousal Support Modification? Contact Feldstein Family Law Group P.C. Today

Contact the post-divorce modification attorneys at Feldstein Family Law Group P.C. if you have questions about spousal support or need to modify an existing order. We can also represent your interests if you wish to contest a Motion to Change. To learn more about the services we offer, contact our firm to schedule a free consultation. During your appointment, we can discuss your case, explore your legal options, and start developing a litigation strategy that reflects your legal objectives.

Call the Feldstein Family Law Group P.C. at (905) 581-7222 to schedule a free consultation. We serve Vaughan, Mississauga, Oakville, Markham, and the surrounding areas in Ontario. We also offer our services to residents in Aurora, King City, Newmarket, and the surrounding areas of York Regio.

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