L.K.S. v. L.M.R. Date:, 2016 BCPC 279

Citation: L.K.S. v. L.M.R. Date: 20160826 2016 BCPC 279 File No: 0831240 Registry: Prince George IN THE PROVINCIAL COURT OF BRITISH COLUMBIA IN THE MATTER OF THE FAMILY LAW ACT , S.B.C. 2011 c. 25 BETWEEN: L.K.S. APPLICANT AND: L.M.R. RESPONDENT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE S.K. KEYES Appearing on their own behalf: L.K.S. Appearing on their own behalf: L.M.R. Place of Hearing: Prince George , B.C.

Date of Hearing: March 11, 2016 Date of Judgment: August 26, 2016 [ 1 ] Mr. S. and Ms. R. are the parents of G.L.G.S., born [omitted for publication], aged 10. The parties entered into a Consent Order in 2013 before Judge Gray (the “Consent Order”), which provided that although Mr. S. earned a Guideline income of $97,394, he would pay child support based on an imputed income of $75,000, in the amount of $701.00 per month.

The Order also provided that the parties exchange financial information annually and that the child support be adjusted in consideration of the preceding year’s income and provided for a review by the Court in order to determine the appropriate level of child support if the parties could not agree. [ 2 ] Mr. S. brought an Application on June 4, 2015, to reduce the amount of child support payable for G.L.G.S., on the basis of undue hardship. Ms.

R. has counterclaimed, seeking to have the child support amount determined pursuant to the Federal Child Support Guidelines and seeking a contribution towards special or extraordinary expenses. Mr. S. is paying down arrears of child support for G.L.G.S. Those arrears amounted to $5,311.00 at the date of hearing. FAMILY SITUATION Mr. S. [ 3 ] Mr. S. is employed as a welder at [omitted for publication] where he has been employed for many years. He earned $103,771 in 2013, (greater than the $97,394 specified in the consent order) and $96,618 in 2014.

In his Financial Statement filed September 15, 2015, he anticipated earning $74,256. However, according to his 2015 T4, he actually earned $88,761 in 2015. He explained that his estimated figure represents his straight time earnings, without any overtime at all. Traditionally his income always included substantial overtime, but he testified the amount of overtime work has declined due to the closure of the Tumbler Ridge mine, where his company did substantial work. He acknowledges that his company could obtain similar work at other mines, but that is beyond his knowledge or control.

I note, however, that his year to date pay stubs (to March 3, 2016) do show overtime pay in the amount of $1,338.75. [ 4 ] Mr. S.’s partner is Ms. H. and they are the parents of two daughters, P. and B. Ms. H. brought a son, Br., into the relationship, who lives primarily with Ms. H. and Mr. S., but spends time with his father also. G.L.G.S. exercises parenting time with Mr. S. on weekends. Thus, together they have three children living in their household more or less full time. [ 5 ] Ms.

H. testified that she ordinarily worked seasonally at her parents’ garden shop, and also collected EI for total earnings of slightly less than $20,000 per year. Ms. H. has had limited employment for the past several years, including maternity leaves. More recently, Ms. H. was in a single vehicle accident in 2015, which has left her unable to work due to concussion symptoms. She is, therefore, remaining at home caring for her young family which saves the family the cost of childcare. [ 6 ] Ms. H. receives support from Br.’s father in the amount of $515 per month.

She also receives $380 in CCTB and $237 in early childhood benefits for three children. [ 7 ] The S.- H. family lives in a home owned by Mr. S. He did not disclose the value of the home or his equity in it. He pays a mortgage in the amount of $1,191 per month. He owns a 2006 Dodge truck worth $4000 and a Dodge Journey, purchased in 2014 for $36,000 which Ms. H. drives. Mr. S. owes arrears of child support for G.L.G.S. that he is paying according to the

schedule fixed in the Consent Order. He has a vehicle loan for the family vehicle driven by Ms. H. and credit card debt which he says was incurred to meet living expenses. [ 8 ] In his Financial Statement, Mr. S. shows extraordinarily low expenditures for clothing, children’s clothing and typical family expenses, and no expense for the insurance on the vehicle Ms. H. drives. Mr. S. explained that Ms. H. pays for that. He has estimated his income tax withheld at source as $19,000 on his estimated income of $74,256.

However, his 2015 T4 indicated that his tax withholdings were only $18,999.32 on his actual income of $88,761.26. It logically follows that his tax withholdings for his estimated income would be substantially lower than he has estimated. I also note that he appears to note his RRSP contributions of $1,300 twice - once in his payroll deductions and once as savings for the future, and claims all of his MSP payments in his expenses, even though he is reimbursed 80%.

Thus it would appear that in his financial statement, his expenses are overstated by several thousand dollars and his income was understated for 2015 by $14,505. Ms. R. [ 9 ] Ms. R. has a son R. age 11, G.L.G.S. age 10, K. aged 3, and C. aged 2. Thus, together with her partner, they have four children living in their household more or less full time. [ 10 ] Ms. R. had her oldest child when she was only 16 and therefore has had little to no opportunity to upgrade her education in order to obtain high paying work. She had G.L.G.S. only a year later with Mr. S. and since they split up, she had two more children.

Although she worked as a desk agent at a hotel in 2012, she earned only $26,000 that year, and has had only maternity leave benefits since then. Since C.’s birth she has only her self-employment for [omitted for publication], selling cosmetic products from which she earns a negligible income. She explains that she cannot get employment sufficiently high paying to afford the childcare costs she would incur if she were working outside the home. She is therefore at home caring for her young family. [ 11 ] Ms. R. receives child support from R.’s father in the amount of $150 per month.

She pays $125 per month for her share of R.’s orthodontic care, which is medically necessary. She receives UCCB in the amount of $440 per month and $1,295 per month Child Tax Benefit based on having four children. [ 12 ] Ms. R.’s partner is T.N. They moved in together in January 2014 and C. was born to them [omitted for publication] 2014. T.N. is a commercial mechanic, but he has only been in that employment for a few months. In 2015, he worked for two employers as a skilled

labourer and had EI earnings with a total income of $69,160. He anticipates that his income as a commercial mechanic in 2016 will belower than last year’s income because his new job does not pay as well as his combined employment last year. [13] Ms. R. rented the accommodation in which the family lives. The regular rent is $1,100 but because she qualified for a rentalsubsidy due to her low income (before T.N. resided with her) she currently receives a rental subsidy of $396.73, so she pays $703.27.

When her eligibility for the subsidy is reviewed in May 2016, she will no longer qualify for that subsidy because the entire familyincome will be taken into account. The vehicle in her name was in an accident 4 years ago and is broken down, but she still has to paythe loan on it. She cannot afford the repairs. She drives a vehicle owned by T.N. worth approximately $4,000. [14] Since moving in with Ms. R. and taking on the support of her and her children, T.N. has gone from being “in the black” to being“in the red.” Although he still owns the vehicles he owned before he met Ms.

R., he has now incurred debt of approximately $10,000just to make ends meet for the family. ISSUE [15] Has Mr. S. met the Undue Hardship test in s. 10 of the Federal Child Support Guidelines (the “Guidelines”) in order to justifyless than table support for G.L.G.S.? Undue hardship 10.

(1) On either spouse’s application, a court may award an amount of child support that is different from the amount determined underany of sections 3 to 5, 8 or 9 if the court finds that the spouse making the request, or a child in respect of whom the request is made,would otherwise suffer undue hardship. Circumstances that may cause undue hardship

(2) Circumstances that may cause a spouse or child to suffer undue hardship include the following: (

a) the spouse has responsibility for an unusually high level of debts reasonably incurred to support the spouses and their children prior tothe separation or to earn a living; (

b) the spouse has unusually high expenses in relation to exercising access to a child; (

c) the spouse has a legal duty under a judgment, order or written separation agreement to support any person; (

d) the spouse has a legal duty to support a child, other than a child of the marriage, who is (

i) under the age of majority, or (ii) the age of majority or over but is unable, by reason of illness, disability or other cause, to obtain the necessaries of life; and (

e) the spouse has a legal duty to support any person who is unable to obtain the necessaries of life due to an illness or disability. Standards of living must be considered

(3) Despite a determination of undue hardship under subsection (1), an application under that subsection must be denied by the court if itis of the opinion that the household of the spouse who claims undue hardship would, after determining the amount of child support underany of sections 3 to 5, 8 or 9, have a higher standard of living than the household of the other spouse. Standards of living test

(4) In comparing standards of living for the purpose of subsection (3), the court may use the comparison of household standards of livingtest set out in

Schedule II. Reasonable time

(5) Where the court awards a different amount of child support under subsection (1), it may specify, in the child support order, areasonable time for the satisfaction of any obligation arising from circumstances that cause undue hardship and the amount payable atthe end of that time. Reasons

(6) Where the court makes a child support order in a different amount under this section, it must record its reasons for doing so. [16] In Bouzane v. Martin, 2014 BCSC 1690, Mr. Justice Kelliher considered the application of s. 10 of the Federal Child SupportGuidelines referred to the leading case in British Columbia regarding hardship as follows: [63] In Van Gool v. Van Gool (1998), (BC CA), 113 B.C.A.C. 200, our Court of Appeal said the following aboutthe undue hardship test: 45. The undue hardship test under s.10 is two-fold. The spouse applying for relief under this

section must prove that payment of thetable amounts would cause undue hardship under s.10 (1) having regard to the criteria in s.10 (2). If this test is met, the applicant mustgo on to establish that, if required to pay the amount of maintenance otherwise payable under the [Guidelines] table, the standard ofliving of his or her household would be lower than that of the household of the other spouse. If this dual test is met, the court has adiscretion to award a different amount of maintenance than that otherwise required under the Guidelines.

[64] The Court went on to describe the test at para. 51: 51. Although s.10 can be used by either the payor or the payee spouse to seek a level of maintenance other than that provided underthe basic [Guidelines] table, thus far the applications have been almost entirely by payors for a reduction in the table amount. Since thebasic tables were designed to be a “floor” for the amount of maintenance payable, rather than a ceiling, it is not surprising that theauthorities have held that the threshold for a finding of undue hardship is high.

Hardship is not sufficient; the hardship must be“undue”, that is, “exceptional”, “excessive” or “disproportionate” in all of the circumstances. The onus is on the party applying under s.10 to establish undue hardship; it will not be presumed simply because the applicant has the legal responsibility for another child orchildren and/or because the standard of living of the applicant’s household is lower than that of the other spouse. The applicant mustlead cogent evidence to establish why the table amount would cause undue hardship. [Emphasis added.] [17] In D.L.D. v.

R.A.G., 2010 BCSC 1080, a case in which the applicant father had a substantially lower income than the motherand had 3 other children to support, Mr. Justice Punnett explained: [20] The court in Van Gool at para. 48 referred to Swift v. Swift, (ON SC), [1998] O.J. No. 501 (C.J. Gen. Div.),in which Justice Robertson commented: [5] Undue hardship is a tough threshold to meet. Payment of child support is often seen as a financial hardship by the payor and thenew family. It generally consumes a large portion of much needed cash or discretionary income.

The payment of the guideline amountwill rarely be a hardship that is undue in the legal sense. [6] Synonyms for undue include: excessive, extreme, improper, unreasonable, unjustified. It is more than awkward or inconvenient.

The application of the guidelines may result in interference with existing financial planning strategy in many payor families. [21] The Concise Oxford Dictionary, 11th ed., defines "exceptional" as "unusual; not typical." It defines "excessive" as "more than isnecessary, normal, or desirable." "Disproportionate" is defined as "too large or small in comparison with something else.” [22] The language in these

definitions clearly suggests that in order to find undue hardship there must be a deviation from what wouldbe considered normal or reasonable. Thus, in Sutton v. Sutton, (BC SC), at para. 13 (B.C.S.C.),Master McCallum stated that “[e]vidence of hardship might include evidence of having to move from one's accommodation, give up avehicle, operate on a restricted diet and so forth." [23] The court must balance the interests of those dependent upon the payor’s income. As explained in Reid v. Nelson (2002), (ON CJ), 30 R.F.L. (5th) 153 (Ont.

C.J.): [27] All of the father’s children deserve and are entitled to his support, regardless to which family they belong. In a second-familysituation, I would expect clear and cogent evidence, not conjecture or speculation, from which an inference could reasonably be madethat the children in the second family would suffer from some significant deprivation, should a table amount of support be ordered forthe child of the first relationship. By this, I mean food, clothing, shelter or some medical or other health need. … DECISION [18] It is Mr.

S.’s obligation to satisfy me that he has met the test in s. 10(1) of the Guidelines. For the following reasons, I find thathe has not done so. [19] Of the circumstances that may cause a spouse of a child to suffer undue hardship listed in S. 10(2) of the Guidelines, the onlyones which might possibly have application to Mr. S. is s.10(d) (support of other children) and (e) (support of disabled spouse.) [20] Dealing with s.10(

e) first of all, Ms. H. is indeed not working at this time due to her post-concussion syndrome. However, Inote that Ms. H. rarely worked more than part time in the years prior to the accident and was on maternity leave much of the time beforethe accident occurred. When she was working, her child care expenses had the effect of eating up most of her earnings. For example, in2014 she claimed childcare expenses of $800 on a T4 earned income of only $1,206. Thus, I find that the drop in family income due toMs. H. not working is negligible. [21] While Mr. S. is clearly supporting his spouse and new family, Mr.

S. has not provided any evidence that any child or anyoneelse in his household is suffering, or would suffer undue hardship from the imposition of table child support. I do not find that handingdown clothes within the family is evidence of undue hardship; in fact I believe that is quite typical of families with more than one child,and of course, second hand shops like Value Village would not exist if it were not for the fact that many people see no hardship inwearing second hand. [22] Far from having to downsize his home or give up a vehicle due to undue hardship, I find that Mr.

S.’s evidence demonstrates thecontrary. For example, Mr. S. and his spouse chose to purchase a vehicle in 2014 which cost $36,000 after the July 4 2013 ConsentOrder in which he had received a reduction in table child support for G.L.G.S. by having his income of $97,394 deemed to be $75,000,some $22,394 less. That reduction was arrived at by consent after Ms. R. brought an application for child support recalculation and itwas then discovered that Mr. S. had not disclosed that his income was substantially more than double the income upon which hisprevious child support order had been based. Ms.

S. managed to negotiate a deemed reduction in income and an arrangement to pay thearrears of child support at only $100 per month. [23] Apparently Mr. S. chose to use the income thus available to him, not to alleviate some undue hardship, but to purchase a homeand purchase a new automobile. A family actually suffering undue hardship might have chosen to purchase a used minivan instead of a

new vehicle, or to rent their home (as Ms. R. does) instead of purchase. Mr. S. also noted that he has obtained a quad for G.L.G.S. to drive at his home, which is obviously a nice thing for G.L.G.S., but not the sort of toy a family suffering undue hardship could be expected to provide for a child. [ 24 ] Having considered all of the evidence before me, I am not satisfied that Mr. S. has met his burden in establishing undue hardship under s.10(1) of the Guidelines . [ 25 ] In view of my finding under s. 10(1), it is unnecessary for me to make a comparison of the relative standards of living, but I find that Mr.

S.’s household income is greater than Ms. R.’s household income and he has fewer people requiring his support in his household. I find that Mr. S.’s household has a higher standard of living than Ms. R.’s household and he would therefore not meet the test under s. 10(3) in any event. [ 26 ] Mr. S. has failed to meet the test required under s.10 of the Guidelines and his application for reduced child support is dismissed. [ 27 ] The child support payable for G.L.G.S. will be the table support indicated based upon Mr. S.’s 2015 income of $88,761. I order that Mr. S. pay child support for G.L.G.S. to Ms.

R. in the amount of $825 per month, commencing June 1, 2015. [ 28 ] I have made the increased child support order effective at June 1, 2015 because that is the date upon which, according to Judge Gray’s order, the review was to have taken place. Although Mr. S.’s 2014 income was larger than his 2015 income, and the 2015 review would ordinarily have taken place based upon the 2014 Tax return information, I recognise that by the summer of 2015 it was apparent to Mr. S. that his 2015 actual income would be lower than his 2014 income, and it turned out to be so.

I find that it is fair, therefore, to base the ongoing child support on the 2015 income as revealed by Mr. S.’s 2015 T4. [ 29 ] The effect of this order is that there will now be additional arrears of child support, the difference between the previous order of $701 per month and the current order of $825 per month. I fix those arrears at $1875 as at August 1, 2016. The arrears are to be paid at $75 per month until paid, commencing September 1, 2016. [ 30 ] I note that Ms. R. also sought to have Mr. S. contribute to G.L.G.S.’s extraordinary expenses under S. 7 of the Guidelines .

Although the Guidelines provide that such expenses are to be shared proportionate to income, Ms. R. is only seeking a 50% contribution from Mr. S. Having considered the means of the parties, including their family incomes, I will accede to Ms. R.’s position. I order that Mr. S. and Ms. R. will share the cost of S. 7 expenses equally. [ 31 ] The balance terms of the order of Judge Gray made July 4, 2013, remain of full force and effect. _____________________________ The Honourable Judge S.K. Keyes