The recent 2021 decisions of Dreesen v Dreesen clarifies the law with respect to whether a change in income source could impact support obligations. A material change in circumstances must be established before any support order may be varied but can a change in an individual’s source of income (i.e. changing jobs) constitute such a change?
The parties in this case were married for about 12 years before entering into minutes of settlement which were reflected in a consent order. Among the provisions regarding child support and spousal support was a provision that if a material change in circumstance occurred, either party could seek a variation of the support arrangements. At the time the parties entered into the minutes of settlement, the appellant was employed and had also started his own business. However, between the time when the minutes of settlement were entered into and when the consent order was made, the appellant lost his job. As a result of this, in 2019 he commenced a motion to change and, in the meantime, unilaterally reduced the support he was giving based on what he believed was his actual income. In the motion, he sought to have both his child and spousal support obligations reduced retroactively and to terminate spousal support going forward. The motion judge found that the appellant had not demonstrated a material change in circumstances which would warrant any reduction in child support. One sticking point for the motion judge was that the appellant had lost his job prior to the consent order and as such, knew about it at the time the consent order was made. The motion judge also found that the appellant continued to have significant self-employment income available for support.
The appellant brought this appeal from the dismissal of his motion to decrease the amount of his child support and spousal support obligations on the basis that his loss of employment in 2017 constituted a material change in circumstances since his income had dropped significantly. Two of the issues in this case was whether the motion judge erred in finding that the appellant’s change in financial circumstances did not constitute a material change in circumstances and imputing the appellant’s pre-tax corporate income when calculating his income available for support.
The appeal court did not agree that the motion judge erred in finding that there was no material change in circumstances. Citing to the SCC decision in Collucci v Collucci, the court made it clear that where a payor applies to retroactively decrease child support, the onus rests with that party, in this case, the appellant, to establish that a material change in circumstance has occurred. While there was no dispute that the appellant had lost his job, the court found that his income did not in fact decrease and as such, he did not meet the threshold requirement for a retroactive decrease in support. In dismissing all of the appellant’s claims on appeal, the court additionally found that there was no error in the motion judge not requiring oral evidence since a trial would have only served as an additional delay and expense for the parties.
All of the appellant’s claims were dismissed and he was ordered to pay costs for the motion to the respondent. In reaching its decision the court settled the ambiguity surrounding changes in source of income and retroactively varying support obligations. The court was clear that a change in the source of income alone will not amount to a material change in circumstances without the necessary supporting documentation to prove that the individual’s income had actually changed. The issue arising out of this case was that the appellant failed to provide any documentation which demonstrated that his income had actually changed as a result of his change in source of income. Without this supporting documentation it could not be said that there had been a material change in circumstances such that a retroactive variation of support would be appropriate.
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