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For a creature of statute, spousal support or alimony, as it is sometimes referred to, is often seen as unruly, unpredictable and unprincipled. Spousal support is discretionary and is assessed on a case-by-case basis, which means “all too often, the only rule seems to be that the spouse with the most money pays”: James G. McLeod & Alfred A. Mamo, Annual Review of Family Law, 2002 (Toronto: Carswell, 2002) 190. Success often turns on the credibility of the parties. As one writer commented “[t]he amounts actually ordered are often tied to the quality of the legal representation, if any, rather than some grand plan or unified theory of support. In short, better to hire a good lawyer than to worry about the law.”: John Syrtash, Family Matters: Recent Decisions alter Spousal and Child Support Landscape (QL: SFLRP/2004-008, March 26, 2004). 

            The difficulty is that there are several competing theories underlying spousal support under the Divorce Act, R.S.C. 1985, c. 3 (2^nd Supp.), which have yet to be reconciled in a principled way by the higher courts. These theories of support include: 

(a)        a traditional marriage or “pension for life” model which awards expectation damages;

(b)        a clean break or rehabilitation model which focused on self-sufficiency and “clean break”, and which awards support to help transition the recipient towards independence;

(c)        a compensatory model, given greater currency in recent years, which attempts to compensate a spouse for economic losses “causally connected” to the marriage or its breakdown;

(d)        an income-sharing model, whether compensatory or non-compensatory in nature, which focuses on the relational nature of marriage based on a view of marriage as a partnership;

(e)        an income security or basic social obligation model which allocates the cost of supporting family members to former spouses rather than the state; and

(f)         a parental partnership model, a variant of the income-sharing model, which recognizes that child support does not fully cover the real costs of child-rearing.

 See Carol Rogerson, “Developing Spousal Support Guidelines in Canada: Beginning the Discussion, Background Paper” (Paper Prepared for the Department of Justice, Canada, December, 2002). 

Shortly after the new Divorce Act came into force in 1985 the Supreme Court of Canada addressed spousal support in a series of three cases known as the Pelech trilogy, which have governed the law of spousal support for the last twenty years. While the Pelech trilogy gave greater weight to the goals of certainty, finality and autonomy, in recent years there has been considerable watering down of the Pelech trilogy by the courts in light of a recognition of the economic reality of marriage and its breakdown: see Miglin v. Miglin, [2003] S.C.J. No. 21; Moge v. Moge, [1992] S.C.J. No. 107; Bracklow v. Bracklow, [1999] S.C.J. No. 14; Boston v. Boston, [2001] S.C.J. No. 45; and B.(G.) v. G.(L.), [1995] S.C.J. No. 72. Some may say that Pelech is dead. But who is the heir to Pelech?

             While the Supreme Court of Canada has had two recent kicks at rectifying the confusion in Boston v. Boston and Miglin v. Miglin, it appears that both attempts are failing miserably. 

So where does that leave us? 

            In light of this there has been a movement afoot recently to develop Spousal Support Guidelines, analogous to the Child Support Guidelines, but of an informal, advisory kind, as the most viable option to inject some certainty and direction back into the law of Spousal Support. See generally D. A. Rollie Thompson, “Slow train comin’: Are spousal support guidelines around the bend?” (Unpublished paper prepared for The Continuing Legal Education Society of British Columbia, September 3, 2003, http://www.cle.bc.ca/CLE/Analysis/Collection/03-spousalsupport (date accessed: January 1, 2005)). The American experience with Spousal Support Guidelines so far indicates that our adoption of similar guidelines would radically shift the focus of debate away from the relationship, the roles and the origin and nature of economic needs. See Carol Rogerson, “Developing Spousal Support Guidelines in Canada: Beginning the Discussion, Background Paper” (Paper Prepared for the Department of Justice, Canada, December, 2002). 

THE PROPOSED SPOUSAL SUPPORT GUIDELINES 

            The Draft Advisory Guidelines were unveiled for public consultation in January, 2005, which are informal, voluntary guidelines to be used on an “advisory basis only”, by design. The Guidelines are based on the income-sharing model in an attempt to get away from the concept of “need” and its clumsy use of budgets. Those who intend to use the Guidelines should do so with an abundance of caution as the Guidelines come with a list of caveats, the most significant of which is their informal, advisory, voluntary basis. The Guidelines are not designed to address entitlement issues, only quantum and duration, nor do they deal with the effect of prior support agreements. Further, in this experimental period the authors intend the Guidelines to be used as a rough-and-ready guide for interim support and negotiated agreements where the formulas can provide a quick, easy calculation. See Carol Rogerson and Rollie Thompson, Spousal Support Advisory Guidelines: A Draft Proposal (Paper Prepared for the Department of Justice, Canada, January, 2005) at v-ix, 91-92. 

            The Draft Advisory Guidelines are just that – Advisory Guidelines. There is much yet to do in refinement and improvement, and in particular, to address provincial/territorial differences. At the present time, for example, the Guidelines must be adjusted to address the peculiarities of Quebec law. Moreover, the low end of the Guideline range may provide amounts at the high end for spousal support awards in some jurisdictions, while at the same time the high end of the Guideline range may provide amounts at the low end for awards in other jurisdictions. It is fully expected by the authors that the next process in the formulation of the Guidelines will be discussion and experimentation, with the understanding that the bench and bar will use them, and within the next year or so, to begin the process of revision, refinement and improvement. See generally Carol Rogerson and Rollie Thompson, Spousal Support Advisory Guidelines: A Draft Proposal (Paper Prepared for the Department of Justice, Canada, January, 2005). 

            The authors of the Guidelines point out that there is no “one big formula”. Under the Guidelines there are two basic formulas: (a) the “without child support formula” and (b) the “with child support formula”, and a whole bunch of factors and exceptions. 

Without Child Support 

The without child support formula focuses strictly on gross income differences and the length of the marriage. Once the “gross income difference” is established the amount and duration of support will increase (within a set range) with the length of the marriage, up to a maximum limit. The formula is based on the idea of “merger over time”, whereby the longer a couple are married, the more intertwined and interdependent their lives become, so the main consideration coming at the end of the marriage is the need to maintain or approximate the marital standard of living, or at minimum, to prevent a sudden and dramatic loss to the recipient spouse’s standard of living. It is drawn from the ALI proposals and the Maricopa Country, Arizona guidelines. 

            Gross income difference is the difference between the spouses’ gross incomes. “Gross income” under the Federal Child Support Guidelines is equivalent. The “amount factor” is set as a range between 1.5 and 2% of the gross income difference for each year of cohabitation. The formula caps at 50%. The “duration factor” is set as a range from 1/2 to 1 year of support for each year of cohabitation, which in essence incorporates a presumption that support after the marriage ought to extend for a period equal to between one-half to the full duration the parties cohabited.

 Support is indefinite for marriages over 20 years in length (the so called “20 Year Rule”). More controversially, support is rather arbitrarily made indefinite for marriages 5 years or longer where the years of marriage and the age of the recipient total 65 or more (the so called “Rule of 65”). 

            The problem with the arbitrary standard of indefinite support for marriages under the 20 Year Rule and under the Rule of 65, is that it incorporates “entitlement” claims into a formula allegedly premised on income sharing alone, while at the same time neglecting or minimizing the equally important considerations of self-sufficiency, need and compensation, each of which speak to quantum and duration of support. The authors address this problem by saying they simply mean no definite time limit will be placed in initial support orders, and further that indefinite support does not necessarily mean permanent support nor does it mean the same level of support will be indefinite. All of which fails to explain what indefinite support really means?           

With Child Support 

            The with child support formula is based on a parental partnership model of spousal support, which fundamentally differs in concept and purpose from the income-sharing model underpinning the without child support formula. It places the emphasis of spousal support on compensating the custodial parent for both the past and ongoing consequences of child rearing. This formula focuses on a fair sharing of the parents’ combined net disposable income after child support, taxes and benefits are worked out of income. In the case law need becomes the proxy because it is impossible or impractical in most cases to obtain estimates of loss of earning capacity. 

The formula avoids need, choosing to focus instead on individual net disposal income (INDI), which complements existing calculations using computer software, such as Childview, for determining net disposable income and monthly cash flow calculations. Further, the formula adopts Guideline Income as the basis for all calculations. 

            Under normal circumstances to determine the amount of spousal support payable it is necessary to find the INDI for each spouse, combine the two INDIs, and then ensure that the custodial parent or recipient spouse receives an amount equal to 40 to 46% of that pool. The payor’s INDI is found by subtracting child support and taxes and deductions from guideline income. The recipient’s INDI is found by subtracting notional child support and taxes and deductions, and adding government benefits and credits (such as the child tax credit), from guideline income. The amount of spousal support payable is that amount required to leave the recipient spouse with between 40 and 46% of the combined INDI. 

             The Guidelines presume that spousal support ought to be paid indefinitely subject to some vague outside time limits, which would provide a duration of 1 year for each year of marriage for longer marriages (i.e., a duration of 10 years or more) and a duration up to the time the last or youngest child finishes high school for shorter marriages (i.e., a duration of less than 10 years). 

In longer marriages there is no minimum duration but the maximum would follow the maximal duration in the without child support formula of one year for each year of marriage. 

In shorter marriages spousal support would be indefinite, subject to review, where the review period would be: 

(a)               where the children are pre-school age, the month after the last or youngest child commences full-time school; or

(b)               where the children are under 12 years of age, the month after the last or youngest child reaches 12 years of age. 

The maximum duration would be the date when the last or youngest child finishes high school. The authors advise that extensions beyond this should only be permitted in very exceptional circumstances, such as the case of special needs children. However, the authors do recognize the likelihood of crossover from the with child support to the without child support formulas in certain circumstances. 

            In the case of shared custody the formula remains the same, however, to recognize the increased child rearing costs in each household and the consequences to each spouse, the amount used to calculate child support and notional child support for both the payor and the recipient is the table amount assuming sole custody, rather than the amount that is actually paid or received.

 In the case of split custody both parents have children in their care, and so a larger proportion of income is devoted to child support, thus, a notional table amount must be deducted from each parent. 

            In the case where the custodial parent is also the parent with the higher income, the formula adopts a merger over time approach, so it is fundamentally the same formula as the without child support formula, with an adjustment for child support. The payor’s Guideline Income is reduced by the grossed-up Notional Child Support and the recipient’s Guideline Income is reduced by the grossed-up by Child Support paid. 

             Some factors outlined by the authors that may influence the operation of the Guidelines include: a strong compensatory claim, property division, need and ability to pay and self-sufficiency. The authors also recognize a number of exceptions to the Guidelines, including strong compensatory claims for short or medium length marriages, the impact of illness or disability on need, the servicing of marital debt, the impact of prior spousal or child support obligations, and compelling financial circumstances at the interim stage. All of these factors and exceptions could have been cast as an Undue Hardship exception. 

Restructured Awards 

            The Guidelines anticipate negotiations as to amount and duration, or so-called “restructured awards”, so long as the overall value of the settlement remains within the range set out by the Guidelines. It is not expected that there is much room for restructuring under the with child support formula. The authors suggest that an award of spousal support under the Guidelines can be restructured by front-end load to shorten duration, by extension to lengthen duration, or by lump sum, so long as the value of the overall award is respected. 

Crossover 

            The Guidelines also anticipate crossover between formulas, such as where the children are grown up in medium to longer marriages, and the end of child support means that the pool of net disposable income has changed. In such circumstances the proper measure of support might be more accurately reflected in a merger over time model rather than a parental partnership model, and income sharing more appropriate than compensating the recipient for the consequences of the marriage and its breakdown. The authors recommend that crossover apply to amount only, not to duration. 

Variation and Changed Circumstances 

            The Guidelines do not deal with entitlement. In cases where there has been an increase or decrease to a spouse’s post-separation income, there may be an adjustment to the amount of support paid or payable where the change is caused by factors relating to the marriage or the marriage breakdown. Any analysis of such changes is fact-based and must be addressed on a case-by-case basis. 

Following current case law there is no prescribed adjustment for a payor’s remarriage. There is no doubt that the recipient’s remarriage has an effect on spousal support. To determine the impact of the recipient’s remarriage is complex and fact-based, and must be considered on a case-by-case basis. Similarly, the existence of a second family and subsequent children should affect the Guidelines, but in the absence of clear guidelines as to how second families and subsequent children affect child support it is impossible to set out any guidelines. Clearly, a change in child support will impact net disposable income and spousal support under the Guidelines. 

Ceilings and Floors 

Subject to the exceptions the Guidelines as a whole set a ceiling for the payor’s gross annual income of $350,000 and a soft floor for the payor’s gross annual income of $20,000, below which no spousal support is payable. To avoid the “cliff effect” there is an exception where the payor’s gross income is more than $20,000 but less than $30,000, in which the percentage is adjusted accordingly. The problem with ceilings and floors is that it introduces an entitlement rule into the formula which is most pronounced in the case of the soft floor of $20,000. 

            The Guideline amounts could have been more formal and structured, with factors and exceptions, such as indefinite support, compensatory claims, property division, need and ability to pay, self-sufficiency, illness or disability, marital debt, prior support obligations, and compelling financial circumstances being addressed as Undue Hardship claims, similar to that adopted under the Federal Child Support Guidelines. The difficulty is determining how that is to be done. 

The Guidelines do provide an informal structure, along with some rough-and-ready formulas for generating ranges for spousal support. Much work is yet to be done. Perhaps, the ease with which the formulas can be employed will encourage use and with time a more structured and consistent system. Time will tell.

THE CURRENT REGIME 

            Subsection 15.2(6) of the Divorce Act, R.S.C. 1985, c. 3 (2^nd Supp.), as amended, sets out the four statutory objectives of spousal support: 

1.      to recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown [s. 15.2(6)(a)];

2.      to apportion between the spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage [s. 15.2(6)(b)];

3.      to relieve any economic hardship of the spouses arising from the breakdown of the marriage [s. 15.2(6)(c)]; and

4.      in so far as practicable, to promote the economic self-sufficiency of each spouse within a reasonable period of time [s. 15.2(6)(d)]. 

When considering spousal support subsection 15.2(4) of the Act, as amended, states that the court is to take into consideration the condition, means, needs and other circumstances of each spouse, including: 

1.      the length of time the spouses cohabited [s. 15.2(4)(a)];

2.      the functions performed by each spouse during the cohabitation [s. 15.2(4)(b)]; and

3.      any order, agreement or arrangement relating to support of either spouse [s. 15.2(4)(c)].

 Similar considerations arise under provincial legislation such as the Adult Interdependent Relationship Act, S.A. 2002, c. A-4.5 and Domestic Relations Act, R.S.A. 2000, c. D-14, as amended, so it should come as no surprise that judges tend to apply the same considerations in common law situations: see Thompson v. Floyd (2001), 17 R.F.L. (5^th) 450 (B.C.C.A.). 

Entitlement to Support 

a.            Economic Advantages or Disadvantages Arising from the Marriage or its Breakdown 

            In Corbeil v. Corbeil the Alberta Court of Appeal held that the purpose of compensatory support is to share the career benefits one spouse received from the career accommodations made by the other: Corbeil v. Corbeil, [2001] A.J. No. 1144 (C.A.). An economic advantage arises if a spouse assumed responsibilities that the other spouse would have otherwise performed, or directly contributed to his or her career or provided a career enhancing opportunity. An economic disadvantage arises if for family reasons a spouse withdrew from the workforce, delayed entry into the workforce or deferred their career or an opportunity for economic independence. 

The reality is that in any long-term cohabitation there are trade-offs made between the parties. A spouse may agree to move across the country to benefit the other spouse’s career or to work long hours as bookkeeper and office manager for the family business. A spouse may withdraw from, or delay re-entry back into, the workforce to raise the children or to support the family while the other spouse completes school. In most relationships it’s difficult to imagine a situation where there hasn’t been some economic advantage or disadvantage arising from the relationship, and these economic advantages and disadvantages become more pronounced following the marriage breakdown. 

b.            Apportion any Financial Consequences Arising from the Care of the Children Over and Above the Support Obligation Apportioned between the Spouses 

            Childcare responsibilities of one spouse may create an economic disadvantage to him or her: Moge v. Moge, [1992] S.C.J. No. 107. Even if a custodial parent receives adequate child support to take into account the actual cost of raising children, his or her childcare responsibilities are likely to still restrict or limit his or her career or employment opportunities. Therefore, it comes as no surprise that s. 15.2(6)(b) contemplates spousal support over and above child support to compensate a custodial parent for the economic disadvantages arising from childcare responsibilities in the wake of the marriage breakdown. Such support should be viewed as compensatory. 

c.            Relieve any Economic Hardship Arising from the Breakdown of the Marriage 

            There is overlap between the scope of s. 15.2(6)(a) and s. 15.2(6)(c). McLeod and Mamo propose that this category ought to be kept for dependency support as described in Bracklow v. Bracklow, where there is no economic disadvantage from the roles adopted in the marriage and no career disruption from the marriage breakdown, but a spouse is unable to maintain the accustomed lifestyle after the marriage breakdown: James G. McLeod & Alfred A. Mamo, Annual Review of Family Law, 2002 (Toronto: Carswell, 2002) 210. See generally Bracklow v. Bracklow, [1999] S.C.J. No. 14. However, non-compensatory, dependency support should be limited. While there is no deemed self-sufficiency in cases of compensatory support, there may be in cases of non-compensatory, dependency support: Bracklow v. Bracklow, [1999] S.C.J. No. 14. 

d.            Promote Economic Self-Sufficiency within a Reasonable Period of Time 

            Despite the assault on the Pelech trilogy, a dependent spouse has an obligation to make reasonable efforts to achieve self-sufficiency: Moge v. Moge, [1992] S.C.J. No. 107. Unless there are compelling reasons a dependent spouse must make every effort to achieve self-sufficiency or reduce their dependence, and they must do so within a reasonable period of time. 

Factors to be Considered 

a.         Need and Ability to Pay

             To determine the needs of the dependent spouse a court will consider the difference between the amount required to maintain the accustomed lifestyle and the amount the dependent spouse can contribute on his or her own. Under this crude calculation the shortfall is the dependent spouse’s need. As stated above, a dependent spouse is entitled to maintain their accustomed lifestyle subject only to the payor’s ability to pay: Moge v. Moge, [1992] S.C.J. No. 107. 

A dependant spouse is entitled to maintain their accustomed lifestyle subject only to the payor’s ability to pay: Moge v. Moge, [1992] S.C.J. No. 107. It would be counterproductive to force the payor into severe poverty or bankruptcy. Still, in the short-term some financial hardship is to be expected. 

b.            Conduct

 While a spouse is entitled to support for any of the reasons provided for in s. 15.2(6) and despite any misconduct on their part, the court has discretion to take a spouse’s behaviour, conduct or actions, or even intervening factors, into consideration when awarding support: see Fisher v. Fisher, [2001] N.S.J. No. 32 (C.A.) and Paradowski v. Paradowski (2002), 305 A.R. 159 (Q.B.).

 c.            Length of Cohabitation and Roles in the Marriage; Traditional versus Modern Marriage 

            As a general rule the longer the period of cohabitation the longer the period of support, and also the more dependent, traditional the role in the marriage the longer the period of support. Conversely, the shorter the period of cohabitation the shorter the period of support, and also in a modern marriage, where there is less dependence the shorter the period of support. The economic consequences of the marriage and its breakdown are likely to be more pronounced where the period of cohabitation is longer and the roles in the marriage more traditional, giving rise to greater dependence: see generally Moge v. Moge, [1992] S.C.J. No. 107 and Bracklow v. Bracklow, [1999] S.C.J. No. 14. 

d.            Second Families

             As a general rule a payor’s support obligations to his or her first family takes priority over his or her second family. While a court will not look at a new partner’s income when considering the payor’s ability to pay, the new partner is expected to contribute to the payor’s joint household expenses as it naturally affects the payor’s current living expenses. Conversely, a payee may still be entitled to support even if he or she remarries or cohabits: B.(G.) v. G.(L.), [1995] S.C.J. No. 72. 

e.            Separation Agreements 

            In the Pelech trilogy the Supreme Court of Canada encouraged parties to settle their financial affairs between themselves, by setting the standard of review for an agreement high. In Miglin v. Miglin the court held that the presence of an agreement was only one of many factors to be considered by the court: Miglin v. Miglin, [2003] S.C.J. No. 21. When considering spousal support the court is invited to consider if the negotiated agreement represents the intentions and expectations of the parties and substantially complies with the objectives of the Divorce Act. The reasonable best efforts of the parties are to be presumptively dispositive, but not determinative, of the spousal support issue. 

f.          Illness and Disability 

Prior to Bracklow v. Bracklow it was generally assumed that a person who marries someone with health problems or assumes responsibility for a spouse who develops health problems during the marriage would be ordered to pay support indefinitely. In Bracklow v. Bracklow the court attempted to rationalize the law of support in holding that a sick or disabled spouse who was financially dependent on their spouse during the marriage was entitled to support, but without some economic disadvantage arising from the roles adopted in the marriage, such support may be limited even if the dependent spouse could never achieve self-sufficiency. 

Amount of Support 

In recent years there has been a trend towards higher awards: James G. McLeod & Alfred A. Mamo, Annual Review of Family Law, 2002 (Toronto: Carswell, 2002) 232. Rather that simply forcing the payor to share his or her disposable income after deducting living expenses, now many judges apportion the joint family resources between the spouses. A dependant spouse is entitled to maintain their accustomed lifestyle subject only to the payor’s ability to pay: Moge v. Moge, [1992] S.C.J. No. 107. As a result both spouses bear the economic advantages and disadvantages of the marriage breakdown and must adjust their lifestyles accordingly. Including child support it is possible for the custodial parent to wind up with more than half of the joint income of the parties. However, judges are mindful of not making support orders so severe as to be punitive to the payor. 

            Despite references in Moge v. Moge and Bracklow v. Bracklow to an equitable sharing of the economic consequences of the marriage and its breakdown, which suggests a consideration of the property acquired during the marriage, judges are mindful not to award support in a way that results in a redistribution of the matrimonial property: Diebert v. Calder, [2001] A.J. No. 310 (Q.B.). 

This approach by the courts seems counterintuitive as both support and property are economic consequences of the marriage and its breakdown. In practice the redistribution of matrimonial property in lieu of, or to supplement, spousal support is often a consideration in settlement negotiations, and the fine distinction between support considerations and property considerations are blurred.

Form of Order 

            The default is periodic support or support paid by the payor on a regular basis, usually, monthly, semi-monthly or bi-weekly: Elliot v. Elliot, [1993] O.J. No. 2308 (C.A.) and Bracklow v. Bracklow, [1999] S.C.J. No. 14. If a party believes a lump sum payment is more appropriate in the circumstances they have the onus of showing why it should be ordered. 

Choosing between periodic support and lump sum support is often an exercise in predicting the future financial positions of the parties premised on the belief both parties will be in a better financial position at a future date. This is often the case as the immediate consequence of the marriage breakdown is economic hardship, as joint assets are split and the joint income is being used to support two separate households. A payee of lump sum support is betting that they can make better use of a quick injection of cash today rather than smaller sums over a longer period. A payor of lump sum support is betting that they can make more over the long run than they currently earn, or their current assets indicate, and so to pay now is of greater value than to continue paying smaller sums over a longer period. Without confidence that with time their financial circumstances will improve a party is likely to stick with the certainty of periodic support. 

Duration of Order           

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