The following case deals with the issue of child support and possible variations thereto based on changes in a Payor-father’s income.
Briefly, the couple were married in March of 1986, separated in 1995 and officially divorced in 1997 after a lengthy and litigious trial for the purposes of determining spousal and child support. Initially, the amount that Mr. Walsh was required to pay was set at $2,021.00 per month in child support and $2,800 per month in spousal support.
As the years progressed, Ms. Walsh applied to the court to vary the child support payable in 2002, 2004 and 2005 with the amount increasing to $5,560.00 per month. Further to this in 2006, after an income assessment was carried out, Mr. Walsh voluntarily increased the child support by paying an additional $2,791.19 due to a rise in his annual income. It should be noted that Ms. Walsh, during this lengthy process which included frequent trips to court, had been ordered to pay costs to her former husband but failed to do so.
This decision, delivered by Justice Corbett from the Ontario Superior Court of Justice, involves yet another application by Ms. Walsh for an increase in child support. Moreover, Justice Corbett rendered judgment on two other corollary issues, namely whether the costs award previously mentioned should be set-off against the child support payable and lastly, what type of order should be made to prevent additional trips to court for the Walshes.
The law states that a variation in a support order will be granted if it can be shown that there has been a material change in circumstances of either the Payor or the Recipient. Justice Corbett identified the following facts as constituting material changes in the circumstances of the Payor:
- His employment was terminated
- His income drastically increased due to the severance package he was given reaching a sum of $1,201,976.00 in 2006 and $1,000,000.00 in 2007, and
- That his income would subsequently decrease as a result of the termination and inability to retain comparable employment due to his age and other personal circumstances.
Mr. Walsh was contrary to paying child support based on the full amount of his 2006 and 2007 incomes because according to him the increases in income in those years were “non-recurring, one-time payments that ought not to be included.” Ms. Walsh however contended that support should continue to be determined as per usual which is on the basis of the prior year’s income therefore allowing the increases in income to be taken into account. Justice Corbett agreed with Ms. Walsh and while referring to ss. 16-20 of the Child Support Guidelines he deduced that termination payments form part of an actual income earned and consequently child support should be paid therefrom. This type of income and support determination forms the settled routine used by the parties which is consistent with the Guidelines and should therefore not be deviated from.
With regards to Mr. Walsh request to set-off the costs award against child support, Justice Corbett quickly dismissed this issue since generally child support is inviolate and takes priority over all other financial issues between parties.
The last thing he set out to do was carefully craft a detailed order which would take into account the changes in circumstances of Mr. Walsh and vary support accordingly in order to eliminate the possibility of future, costly litigation.