Background
The Applicant husband and Respondent wife married in 2007 in Egypt. The Respondent is a qualified physician in Egypt although was unable to obtain the certification required in Canada. The Applicant is qualified in Canada as a pharmacist and has worked as such for a few years. The pair have one child who was born in 2010.
The Applicant claims that he found proof of infidelity in their marriage while the Respondent went back to Egypt to study. The Applicant then had an Egyptian lawyer serve the Respondent with an application for divorce. The Respondent returned to Canada unexpectedly. The Applicant then sold his home setting aside half of the proceeds for the Respondent.
In April of 2016, the Respondent brought an urgent motion seeking interim child and spousal support, as well as that the remainder of the sale proceeds of their home to be paid into court. Justice Bloom granted the motion and set the child support to $1,000 and spousal support to $2,000 monthly. A divorce order was granted in December 2016.
In February of 2017, both parties brought motions to vary support payments; the Applicant wished to pay less, the Respondent wished to receive more. The Applicant’s salary would get paid to a corporation, and then the Applicant paid himself from this corporation. This corporation would also make payments to his parents. The court found that such payments were exaggerated and attributed that all the money being paid to the parents was part of the applicant’s income. The court therefore increased child support to $1,161 and spousal support to $3,055 per month.
In June 2018, the Applicant brought a motion to vary Justice Bielby’s order. This motion was missing documents and was adjourned multiple times until October of 2018. By then, the Applicant was in arrears of support, and the Respondent brought a motion to enforce the arrears. The Applicant requested relief from these arrears; this request was declined by Justice Trimble. Furthermore, he ordered that until the Applicant paid the support arrears, he could have no further access to the court.
On June 14, 2019, the Applicant claimed bankruptcy. He owed support of approximately $25,000 and had liabilities of $62,000.
In August of 2020, the Applicant received a first notice stating that his driver’s license was suspended from the Family Responsibility Office (FRO). As part of this order, he was required to bring a motion to vary his support obligations within 20 days.
Issues
- Can the Applicant prove extreme financial change?
- Can his financial obligations to his ex-spouse be altered and to what extent?
Analysis
The Applicant states the change in his financial circumstance is evident as he has lost his job and has gone bankrupt. He claims that his income seriously declined after 2015 due to reductions in the price of prescription drugs and a volatile pharmaceutical industry during the pandemic.
The Respondent argues that the change in circumstance is not proven, and the court should not accept the applicant’s evidence. She provided advertisements for pharmacist positions stating that the demand for pharmacists has not been reduced by the pandemic. The Respondent further argues that the demand for pharmacists must have increased because pharmacies now give vaccinations. She claims that the Applicant is purposely underemployed.
Proving financial change
The court examined written statements and records from the Applicant. The court examined letters from his place of employment, records from his business bank account, the assignment of bankruptcy in June of 2019, documents demonstrating the drop in hourly wage which he was working for, and an invoices report demonstrating gains from CERB. Considering this evidence, the court held that there was enough change in circumstance to warrant a change in the support arrangements.
Adjusting Support
The court stated that it was necessary to determine an appropriate amount of support. This analysis required an approximate analysis of what would be fair on a “rough justice” basis.
The court asserted that the Applicant ought to be able to achieve sustainable and well-paying employment soon. All things considered, even though the Applicant has limited ability to write in English and speaks with a heavy accent, he still is in good standing with the College of Pharmacists. Therefore, the court imputed an income of $50,000 for 2021.
As a result, the court varied monthly support starting June 2018 (when the applicant began facing financial hardship). Accordingly, the total monthly payments for child and spousal support from the year 2018 until 2021 are as follows: $2,300, $984, $287, $561.
The court found that if the Applicant has overpaid any previous monthly payments in consideration of this judgment, he may stop paying spousal support until the overpayment is fully depleted. The Applicant cannot discontinue paying for child support without an agreement or court order.
Conclusion
It is evident that in the event of bankruptcy, a court can adjust the support that a party must pay. If support is retroactively reduced after being paid, the court may allow spousal support payments to discontinue until the overpayment is depleted. In this circumstance, child support payments must continue.
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Categories: Divorce, Children, Child Support, Spousal Support, Bankruptcy