2019 NLCA 32, 2019 NLCA 32

Raymond Thomas (appellant) v.Erin Thomas (respondent) (17/107) Indexed As: Thomas v. Thomas 2019 NLCA 32 4 C.A.N.L.R. 432 Court of Appeal of Newfoundland and Labrador Fry C.J.N.L., Welsh and O’Brien JJ.A. May 22, 2019

Summary: The respondent mother filed an application f or divorce, parenting arrangements and child support in the Superior Court of Justice in Ontario in 2016. That court issued a provisional order along with reasons for the order. Those documents were filed with the Supreme Court of Newfoundland and Labrador, Family Division in Corner Brook and a confirmation order was eventually made. The confirmation court received and accepted evidence related to Mr. Thomas’ actual income from his employment at Memorial University. In addition, Mr.

Thomas led evidence that a restaurant he started in 2015 as a sole proprietorship generated significant losses. The court declined to set off the significant net business losses against his employment income for child support purposes. The trial judge varied the provisional order by eliminating three years of retroactive child support, which reduced the amount of retroactive support due. The appellant father appealed arguing the trial judge erred in calculating his income for child support purposes by failing to take account of business losses and failing to properly consider the issue of undue hardship .

Held: Appeal dismissed. Fry C.J.N.L (Welsh and O’Brien JJ.A. concurring): The determination of Mr. Thomas’ income for the purposes of child support is governed by the provisions of the various provincial Child Support Guidelines which mirror the Federal Child Support Guidelines, SOR/97-175 . Sections 15 and 16 of the Guidelines set out that normally a payor’s “annual income” is used for the purposes of child support.

Section 16 does not say that the amount as disclosed on the tax return is to be used. Under

section 17, the court may choose to adjust the amount of a business loss, including related expenses, to arrive at what the court considers the appropriate amount of annual income. The trial judge referred to these sections when he made his findings with respect to Mr. Thomas’ income for the purposes of child support.

The trial judge correctly stated the law with respect to the determination of income under the Guidelines and then proceeded to exercise his discretion with respect to the treatment of the business losses once he determined that the Line 150 approach would not result in a fair determination of income for child support purposes. The trial judge’s decision and exercise of discretion in this case is entitled to deference. Interference would only be justified where it can be shown that a trial judge has made a palpable and overriding error. Mr.

Thomas has not demonstrated a palpable and overriding error or a material error in the judge’s determination of income for child support purposes. The trial judge recognized that he was exercising judicial discretion when he eliminated three years of retroactive child support. In exercising his discretion the trial judge focused on appropriate factors including the timing of the request for increased child support, the date of the application, Mr. Thomas’ employment income and any hardship that might be occasioned by a retroactive award considering the new family obligations and business debts.

There is no basis to disturb the exercise of the trial judge’s discretion with respect to his reduction of the amount of retroactive child support. Neither party has demonstrated any error in the application of the applicable law to the factual circumstances and the evidence.

Section 10 of the Guidelines provides a specific legislated mechanism to determine if the amount of child support determined under the Guidelines , when combined with other circumstances, may support a legal determination of undue hardship. While Mr. Thomas was self-represented at this hearing, he had counsel at the court appealed from. He did not plead undue hardship and his counsel did not lead evidence which would have permitted the type of analysis required under

section 10 . The judge cannot be said to have erred in failing to complete a full analysis and comparison of household incomes when it was not requested, nor was evidence led which would

have allowed an analysis of household standards of living to assess a claim of undue hardship. The appeal should be dismissed. Cases cited: D.B.S. v. S.R.G., 2006 SCC 37, [2006] 2 S.C.R. 231 Locke v. Goulding, 2012 NLCA 8 Botha v. Botha, 2000 ABQB 870 Lamb v. Lamb (1998), (SK KB), 166 Sask. R. 170 (Sask. Q.B.) Vanderstoop v. Vanderstoop, 1998 ABQB 156 Hickey v. Hickey, (SCC), [1999] 2 S.C.R. 518, 138 Man. R. (2d) 40 Counsel: Appearing on his own behalf, the appellant; Adam Baker, for the respondent. This appeal was heard on April 12, 2019 before Fry C.J.N.L., Welsh and O’Brien JJ.A.

The following judgment was filed on May 22, 2019 by Fry C.J.N.L. for the Court. ______________________________________________________________ Fry C.J.N.L.: INTRODUCTION [1] This appeal concerns the amount of child support to be paid by the appellant to the respondent with respect to their child, whoresides with Ms. Thomas, his mother, in Ontario. [2] Mr. Thomas, the father, lives on the west coast of Newfoundland and Labrador, where he is employed by Memorial Universityof Newfoundland (MUN). He also operated a restaurant in the area. [3] Ms.

Thomas made an application for divorce, parenting arrangements and child support in the Superior Court of Justice inOntario in 2016. That court issued a provisional order along with reasons for the order. Those documents were filed with the SupremeCourt of Newfoundland and Labrador, Family Division in Corner Brook and a confirmation hearing was scheduled. [4] Both parties were represented by legal counsel at the confirmation hearing which concluded with a confirmation order onDecember 5, 2017. [5] Mr.

Thomas’ primary grounds of appeal are that the trial judge erred in calculating his income for child support purposes byfailing to take account of business losses and failing to properly consider the issue of undue hardship. BACKGROUND [6] The parties were married in 2008, and separated in 2010. Their son was born in December of 2009. Mr. Thomas moved fromOntario to the west coast of Newfoundland and Labrador, where he is employed as an associate professor at Memorial University.

Hehas re-partnered and has two children with his new partner. [7] The parties had a written agreement with respect to custody of and access to their son, and an oral agreement where the fatherwas to pay $500 a month in child support plus $100 a month for an RESP contribution for their child. [8] Ms. Thomas made a request to Mr. Thomas for an increase in child support and on several occasions requested his annualincome tax returns to determine if the correct amount of child support was being paid in accordance with the child support guidelines.

Having received no financial information, nor an increase in child support, on September 26, 2016, she made an application to theOntario Superior Court for divorce, a parenting plan to deal with the current situation of the two parents living in two different provinces,child support, and retroactive child support.

[ 9 ] In his reasons, the judge in Ontario, G.A. Campbell J. expressed frustration with respect to the lack of disclosure of the financial information from the father when he stated in his introduction to his provisional decision: [1] Hide and seek is a children's game not a valid or acceptable litigation strategy. [2] There exists ample case law and legislation that requires full, complete and timely financial disclosure.

The rules are clear and unambiguous as is every case decided in this province that litigants, whether reluctant or enthusiastic participants in family law proceedings must serve and file all of the documentation explicitly required by s. 21 of the Federal Child Support Guidelines . [3] These obligations are not new (in force for over 15 years) and I am unaware of any exception to the legislation by which Mr.

Thomas could possibly avoid full, frank and complete financial disclosure. [4] His noncompliance with the legislation allows this (or any) court so inclined, to make adverse inferences regarding his actual or attributed income for child support calculation purposes. [5] The provisions of the Interjurisdictional Support Order Act , R.S.0. 2002 c.13 allow Ms. Thomas to bring her application in this province, without notice to the Respondent, for an order for support [6] In this case, despite various requests, (then demands) which requests/demands were ignored or stonewalled by Mr.

Thomas for financial disclosure, Ms. Thomas finally started her Application for child support only in September 2016 and personally served Mr. Thomas with her application and supporting documents. [7] Despite that consideration, the respondent has ignored the very clear direction to serve/file financial disclosure that is included on the face of the application. [8] Accordingly, I accept the only evidence before the court regarding the respondent's ability to pay child support.

The applicant's "need" for child support is self-evident and requires no direct evidence to establish their son’s need for financial support from both of his parents. [ 10 ] The Ontario judge then went on to use the Faculty Association collective agreement for Memorial University to impute income to Mr. Thomas of $120,000 per year and based the amount of child support, in the amount of $1,037.00 per month, on that income. [ 11 ] The Ontario judge provisionally ordered three years of retroactive child support from August 1, 2013 also at the rate of $1,037.00 per month less all child support payments made by Mr.

Thomas in that timeframe. [ 12 ] The provisional order was then sent to the Supreme Court of Newfoundland and Labrador, Family Division in Corner Brook where a confirmation hearing was scheduled. The parties to the confirmation hearing were required to attend court on a number of occasions to address financial disclosure issues. Legal counsel represented each party and both parties gave sworn evidence. In addition, numerous documents were tendered. [ 13 ] The confirmation court received and accepted evidence related to Mr. Thomas’ actual income from his employment at Memorial University.

The income from employment in 2015 was $103,663.52 and in 2016 was $108,129.79. Actual income for 2017 was not available as the hearing concluded before the end of 2017, however the trial judge used a statement of income dated May 25, 2017 to estimate the 2017 employment income to be $112,040.18. In his Appeal Book, Mr. Thomas provided his 2017 T1

Summary that disclosed employment income of $112,438.95. [ 14 ] In addition, Mr. Thomas led evidence that a restaurant he started in 2015 as a sole proprietorship generated significant losses. The net business loss claimed on his income tax return in 2015 was $86,601.47 and $162,399.35 in 2016. The 2017 tax

summary was not available to the trial judge although he commented in his decision that he was aware from the evidence that the business losses were continuing for 2017. In fact, the net business loss on the 2017 tax

summary was $126,978.24. [ 15 ] At the confirmation hearing, the trial judge determined that Mr. Thomas’ employment income was never $120,000. He found that since 2013, the appellant's source of income had been derived from his employment with Memorial University. The court declined to set off the significant net business losses against his employment income for child support purposes. [ 16 ] The court declined to use Mr.

Thomas’ declared line 150 income for 2015 ( $22,267.55) and in 2016 (negative $45,579.54) and instead relied on his employment income, less union dues, to arrive at income figures for the purpose of calculating child support. [ 17 ] This resulted in a child support order of $928.00 per month from January 2016 to December 31, 2016 based on an income of $107,158.21. For 2017, the child support order reflected an amount of $968.00 per month based on an income of $112,040.18.

For 2018, the order was to continue at the same rate as 2017 and a recalculation clause was included with the confirmation order. [ 18 ] With respect to reviewing the provisional retroactive child support order, the court considered the factors in D.B.S. v. S.R.G . , 2006 SCC 37 , [2006] 2 S.C.R. 231 .

The confirmation court considered the timing of the request for increased child support, the date of application, and any hardship that might be occasioned by a retroactive award considering the new family obligations and business debts. [ 19 ] Using employment income from 2013 to 2017, the confirmation court calculated (as provisionally ordered) that the retroactive payment amounted to approximately $25,313.32. [ 20 ] The trial judge concluded that this amount would create a significant burden on Mr.

Thomas “in light of all of the circumstances of this matter.” The trial judge exercised his discretion and awarded retroactive child support to commence January 1, 2016. He found Ms. Thomas requested an increase in child support from Mr. Thomas during Christmas of 2015 and, receiving no adequate response, commenced her application through the court process in 2016.

[ 21 ] The trial judge thus varied the provisional order by eliminating three years of retroactive child support, which reduced the amount of retroactive support from $25,313.32 to $9,734.62. He also provided in the confirmation order that it be paid at a rate of $150.00 per month. [ 22 ] A few general comments are necessary regarding the procedure used by the courts in Ontario and in Newfoundland and Labrador to address the matter of child support with the parents living in two different jurisdictions.

In the Family Division of the Supreme Court of Newfoundland and Labrador, where this matter was heard, both parties were represented by legal counsel and neither raised any issues with respect to procedure, nor did the judge who heard the matter. [ 23 ] The judge in Ontario referred to the Interjurisdictional Support Orders Act , S.O. 2002, c. 13 ( ISO ) under which he made a provisional order for support subject to confirmation in Newfoundland and Labrador.

This two-stage process is not generally used with regard to ISO applications but is the procedure required to be used with respect to variation applications of orders made pursuant to the Divorce Act , R.S.C., 1985, c. 3 (2nd Supp .) (see sections 18 and 19 ). [ 24 ] An Interjurisdictional Support Orders Act has been adopted with minor variations by all provinces in Canada.

This allows parties, whether married or not, and in the absence of a corollary relief order under the Divorce Act , to make a written application in one reciprocating provincial jurisdiction and have that document conveyed through the designated authority to the receiving jurisdiction where the respondent resides.

The receiving jurisdiction then requires the respondent to attend court with the appropriate financial or other relevant information and that court holds a hearing and is permitted, among other things, to make a support order. [ 25 ] I note that sections 7(1) and (3) of the Ontario ISO legislation (similar provisions are found in all jurisdictions) provides as follows: 7(1) If the claimant reasonably believes that the respondent ordinarily resides in a reciprocating jurisdiction that requires a provisional order , the Ontario court may, on the claimant application and without notice to the respondent, make a provisional order taking into account the legal authority on which the claimant's application for support is based. 7(3) If a provisional order is made, the court shall send it to the designated authority, which shall send to the reciprocating jurisdiction, (

a) three certified copies of the provisional order; and (

b) a support application referred to in subsection 5(2). (Emphasis added.) [ 26 ] Newfoundland and Labrador is a reciprocating jurisdiction under the ISO regime, but it does not require a provisional order under its legislation. The judge in Ontario decided to make the support order provisional subject to confirmation in Newfoundland. He also provided reasons to accompany his provisional order, which provided helpful context to the confirming court. The procedure used, while unusual, provided for a fair hearing with both parties represented and allowed a reasonably expeditious resolution.

The procedure used avoided the delay often associated with ISO matters when the receiving court holds its hearing and then has to request further information from the originating jurisdiction. There were no objections from legal counsel and the procedure adopted provided a proportionate and efficient response by the receiving court to the situation presented and the context in which it arose. ISSUES [ 27 ] Mr. Thomas submits that the trial judge erred in not permitting business losses to be deducted from the determination of income for child support purposes. [ 28 ] Mr.

Thomas also submits that the trial judge erred in not finding undue hardship and thereby adjusting child support either ongoing or retroactively. [ 29 ] Finally, Mr. Thomas requests this Court to provide clarity on how payments for travel related to their son’s summer visits should be assessed and shared between the parents. ANALYSIS Determination of Income [ 30 ] The determination of Mr. Thomas’ income for the purposes of child support is governed by the provisions of the various provincial Child Support Guidelines which mirror the Federal Child Support Guidelines, SOR/97-175 (the Guidelines ).

Given that the parties and the judges in both Ontario and Newfoundland and Labrador have referred to the sections of the federal Guidelines , I will for consistency purposes continue to reference the sections of the federal Guidelines , which are identical to the provincial Guidelines with the exception of the numbering of certain sections. [ 31 ] Sections 15 and 16 of the Guidelines set out that normally a payor’s “annual income” is used for the purposes of child support.

The annual income is determined using the sources of income set out under the heading “total income” in the T1 General form issued by Revenue Canada. This is often referred to as Line 150 income. [ 32 ]

Section 16 stipulates that in determining income, the sources of income set out in the tax return are to be used. Subject to sections 17 to 20, a spouse’s annual income is determined using the sources of income set out under the heading “Total income” in the T1 General form issued by the Canada Revenue Agency and is adjusted in accordance with

Schedule III. [ 33 ]

Section 16 does not say that the amount as disclosed on the tax return is to be used. For most payors who are employees, the income figures are as set out in the individual’s tax return. However, where income from self-employment is also in play,

section 16 is

quite clear that income can be determined using the “sources of income” under the heading “Total Income” in the T1 General. The objective is to determine the fairest indicator of the payor’s income from those sources. [ 34 ] The total income may be adjusted in accordance with items found in

Schedule III of the Guidelines , a common example being union dues. [ 35 ] The calculation of annual income pursuant to

section 16 is also subject to sections 17-20.

Section 17 is reproduced below:

(1) If the court is of the opinion that the determination of a spouse’s annual income under

section 16 would not be the fairest determination of that income, the court may have regard to the spouse’s income over the last three years and determine an amount that is fair and reasonable in light of any pattern of income, fluctuation in income or receipt of a non-recurring amount during those years.

(2) Where a spouse has incurred a non-recurring capital or business investment loss, the court may, if it is of the opinion that the determination of the spouse’s annual income under

section 16 would not provide the fairest determination of the annual income, choose not to apply sections 6 and 7 of

Schedule III, and adjust the amount of the loss, including related expenses and carrying charges and interest expenses, to arrive at such amount as the court considers appropriate. [ 36 ] The trial judge referred to these sections when he made his findings with respect to Mr. Thomas’ income for the purposes of child support. Section 17(2), in particular, refers to situations where a person has incurred a non-recurring business loss and the court is of the opinion that the determination of that person's annual income under

section 16 would not provide the fairest determination of the annual income. The court may choose not to apply paragraph 6 and 7 of

Schedule III and adjust the amount of the loss, including related expenses, to arrive at what the court considers the appropriate amount of annual income. [ 37 ]

Section 19 of the Guidelines also provides the court with an opportunity to impute an amount of income in certain circumstances. As applied in this case,

(1) The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following: … (

g) the spouse unreasonably deducts expenses from income; …

(2) For the purpose of paragraph (1)(g), the reasonableness of an expense deduction is not solely governed by whether the deduction is permitted under the Income Tax Act . [ 38 ] In the present situation, in addition to reducing the Line 150 income of Mr. Thomas to a negative amount in two of the three years under consideration, the business losses also had the effect of reducing the amount of income tax payable. [ 39 ] The trial judge determined that using the Line 150 income was neither appropriate nor reasonable in light of the extent of the net business losses of the restaurant.

He further determined that there was “no element of fairness” in using these amounts for child support purposes as this would result in no child support being paid despite a solid source of employment income and a choice by Mr. Thomas to invest it in a money-losing restaurant venture.

The trial judge in his oral decision stated that he was exercising his discretion pursuant to sections 16 - 20 of the Guidelines . [ 40 ] The trial judge correctly stated the law with respect to the determination of income under the Guidelines and then proceeded to exercise his discretion with respect to the treatment of the business losses once he determined that the Line 150 approach would not result in a fair determination of income for child support purposes. [ 41 ] Hoegg J.A. in Locke v.

Goulding, 2012 NLCA 8 discussed the standard of review applicable to the exercise of judicial discretion in circumstances such as this. In doing so, she examined two other decisions of this Court: [19] In the next paragraph of Green, [2005 NLCA 29], Roberts J.A. refers to the analysis of Green J.A. found at paragraph 20 of Cooper v.

Cooper 2001 NFCA 4 , 198 Nfld. & P.E.I.R. 1 , another family law case: In the instant case, the issue is not whether the judge made an error in principle in determining the legal test to be applied; rather, the issue revolves around the treatment by the judge of the evidence to which the legal principles were applicable.

In the context of an appeal of an order varying support, which was described as having a “fact-based and discretionary nature” involving the balancing of various factors with an appreciation of the particular facts of the case, L’Heureux-Dube J. reiterated the rationale for appellate deference in such cases, in Hickey v. Hickey at para. [12] as follows: It avoids giving an incentive to appeal judgments and incur added expenses in hope that the appeal court will have a different appreciation of the relevant factors and evidence.

This approach promotes finality in family law litigation and recognizes the importance of the appreciation of the facts by the trial judge. Though an appeal court must intervene when there is a material error, a serious misapprehension of the evidence, or an error of law, it is not entitled to overturn a support order simply because it would have made a different decision or balanced the factors differently.

That approach and its rationale apply equally to the circumstances of the instant case, where to arrive at an appropriate decision the judge had to weigh and balance a number of factors in the light of his appreciation of the evidence presented. All of these formulations of the standard of appellate review have as their underlying theme the notion that interference with a trial judge’s treatment of the evidence will only be justified where it can be shown that he or she made a “palpable or overriding error”, or manifest error, in the assessment and appreciation of the evidence.

[42] The determination of how to deal with business losses in determining income for child support purposes is “fact-based and of adiscretionary nature.” (Guidelines

section 16-20 and

Schedule III referenced earlier.) [43] Case law provided for this Court’s review demonstrates a variety of approaches to dealing with the issue of whether or notbusiness expenses or business losses should be allowed in the context of determining income for child support purposes. In the presentsituation, we have an individual who has salaried full time employment and is operating a sole proprietorship on the side. Mr.

Thomasadvised this Court that he has two children with his new partner and was trying to find an opportunity to augment the family income andcreate an employment opportunity for his new partner. [44] In Botha v. Botha, 2000 ABQB 870, a case involving a medical doctor operating a side venture in horse racing, Coutu J. stated atparagraph 40: For the purposes of calculating monies available to Dr. Botha to support his family I am of the view that it would not be fair to deductDr. Botha’s farm losses as against his personal income. This race horse ownership is a hobby which results in savings of tax which givesDr.

Botha more disposable income. It is inappropriate to subsidize that hobby with funds available for child support. Further, it is aninvestment expenditure largely of a capital nature to earn future income and ought not operate to the present detriment of the children.When the choice is between expending monies for child support or expending monies for horses, the child support ought to have higherpriority. [45] Botha involved a self-employed payor but two other decisions reviewed in Botha involve circumstances similar to the presentsituation.

In each case the payor had an employment-based income as well as some business losses related to a side venture. In Lamb v.Lamb, (Sask. Q.B.), (SK KB), 166 Sask. R. 170, Ms. Lamb was employed but also sought to have her child supportbased on her Line 150 income after deduction of the farming losses. Based upon section 19(1)(

g) of the Guidelines, McIntyre J. afteracknowledging that business losses may be deductible in certain circumstances stated: [116] … While the farming losses may be deductible for income tax purposes, as it appears no income is being generated by the farmingactivity of the petitioner, it is unreasonable that she be able to reduce her income for the purposes of the guidelines and her obligation tosupport her children by deducting these losses. (Emphasis Added.) [46] In Vanderstoop v.

Vanderstoop, 1998 ABQB 156, Kenny J. noted that it may be appropriate in certain situations to include losseswhich result in a lower income for child support purposes but this was not one of them. She disallowed an $8,000 farming loss as againstMr. Vanderstoop’s employment income commenting that that by using the farming loss, Mr. Vanderstoop actually reduced the tax hewould otherwise have to pay on his employment income, thus increasing his spending capacity. [47] Mr.

Thomas argued before the trial judge that these cases were not appropriate because his restaurant business was not a“hobby” or secondary to his main source of employment income. He submitted that it was related to his work because he is a professorof food science. He also submitted that business losses were to be expected, as the restaurant business is difficult. He also told the trialjudge that he was moving the restaurant to a different location. He further submitted that, because of his experience in the restaurantbusiness, he has developed a new product that may prove to be financially successful.

He reiterated the same submissions in this Court. [48] The trial judge was aware of Mr. Thomas’ financial situation, the magnitude of the business losses, and the three-year period oftime during which the very significant losses took place. He heard argument from both parties’ legal counsel. The trial judge’s decisionand exercise of discretion in this case is entitled to deference. As noted earlier, interference would only be justified where it can be shownthat a trial judge has made a palpable and overriding error.

The Supreme Court of Canada, as noted above, confirmed this approach byrecognizing the importance of the role of the trial judge in fact finding and balancing of relevant factors and the promotion of finality infamily law litigation (Hickey v. Hickey, (SCC), [1999] 2 S.C.R. 518, 138 Man. R. (2d) 40 at para. 12). An appeal courtis not entitled to overturn a support order on the basis that it would have made a different decision or balanced the factors differently. Mr.Thomas has not demonstrated a palpable and overriding error or a material error in the judge’s determination of income for child supportpurposes.

Retroactive Child Support [49] At the confirmation hearing, counsel for Mr.

Thomas submitted that the provisional order relating to a retroactive adjustment ofthe amount of child support effective January 1, 2013 should not be confirmed. [50] In his oral decision, the trial judge referred to counsel’s submissions and arguments including: a review of the factors in D.B.S.;that there had been an oral agreement for child support; that there had been delay in bringing an application to the court before 2016; thathe paid the amount of child support when he could; that his son was included on his health plan and that he had two other children withhis new partner.

The trial judge noted that counsel for Mr. Thomas also argued that there could be hardship if he were ordered to payany retroactive child support at all. [51] The trial judge reviewed the circumstances of how the child support payments started and how they were adjusted over time. Hetook note of Ms. Thomas’ position that it was Mr. Thomas who decided how much should be paid. The trial judge noted that Ms.Thomas had asked for an increase in December 2015 because she wanted to receive the correct amount in light of Mr. Thomas’ income,as she believed he had misled her about his income.

She had not received any income information from him nor had he provided therequired financial information for her 2016 application. [52] The trial judge also outlined the arguments made by counsel for Ms. Thomas who requested that there be a full confirmation ofthe Ontario provisional order and submitted that income for child support purposes should be based on employment income adjusted forunion dues. Ms. Thomas argued for full retroactivity on the basis that hardship was only one of four D.B.S. factors for the Court toconsider.

[ 53 ] The trial judge outlined in detail, in the transcript of his oral decision, his review of each of the factors in D.B.S. and how the evidence related to each. He referenced paragraph 116 of D.B.S. where Bastarche J. stated: I agree with Paperny J.A., who stated in D.B.S. that courts should attempt to craft the retroactive award in a way that minimizes hardship (paras. 104 and 106). Statutory regimes may provide judges with the option of ordering the retroactive award as a lump sum, a series of periodic payments, or a combination of the two: see, e.g., s. 11 of the Guidelines .

But I also recognize that it will not always be possible to avoid hardship. While hardship for the payor parent is much less of a concern where it is the product of his/her own blameworthy conduct, it remains a strong one where this is not the case. [ 54 ] The Ontario Court made a provisional order arising out of the 2016 application by Ms. Thomas and granted three years of retroactive support to commence on January 1, 2013. This order was subject to confirmation and made without the benefit of Mr.

Thomas’ income because he had not provided it. [ 55 ] The trial judge recognized that he was exercising judicial discretion when he eliminated three years of retroactive child support. In exercising his discretion the trial judge focused on appropriate D.B.S. factors including the timing of the request for increased child support, the date of the application, Mr.

Thomas’ employment income and any hardship that might be occasioned by a retroactive award considering the new family obligations and business debts. [ 56 ] The trial judge varied the provisional order by making the retroactive child support effective January 1, 2016. [ 57 ] I would not disturb the exercise of the trial judge’s discretion with respect to his reduction of the amount of retroactive child support.

Neither party has demonstrated any error in the application of the applicable law to the factual circumstances and the evidence. [ 58 ] In reviewing the debtor statement of account at this hearing, it was not clear that Mr. Thomas’ payments to Ms. Thomas, prior to the order being registered, had been credited to his account. Mr. Thomas was advised that he could contact the Support Enforcement Agency to discuss whether this had in fact been done. Counsel for Ms. Thomas indicated that he would advise his client that she should confirm payments made to her since 2016 with the Support Enforcement Agency.

Undue Hardship [ 59 ]

Section 10 of the Guidelines provides a specific legislated mechanism to determine if the amount of child support determined under the Guidelines , when combined with other circumstances, may support a legal determination of undue hardship. A different amount of child support may be appropriate if this is established.

Section 10 provides:

(1) On either spouse’s application, a court may award an amount of child support that is different from the amount determined under any 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.

(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 to the 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.

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

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

Schedule II. [ 60 ] Consideration of an application under

Section 10 of the Guidelines is unlike the previous analysis where the trial judge considered the D.B.S. factors, one of which is the hardship that a retroactive award of child support may have on the payor. There must be a specific pleading supported by the appropriate documentation and evidence including relevant material to support the household standards of living test required by

section 10. [ 61 ] In the circumstances of this case, there was no formal pleading of undue hardship pursuant to

section 10 . Counsel for Mr. Thomas referred to hardship as a factor that should be weighed in relation to the order of retroactive child support at the confirmation hearing. As has been previously described, the trial judge did weigh the factor of hardship in making a significant adjustment to the amount and duration of retroactive child support to be paid, in the context of Mr. Thomas’ financial and family circumstances. [ 62 ] Mr.

Thomas, in the court below, described his business expenses in his response and his counsel focused submissions at that hearing on the inclusion of the business expenses for the purposes of the calculation of income for child support purposes. Mr. Thomas’ submissions also focused on the verbal agreement that had been reached for a specific amount of child support at a previous time. At this

hearing, Mr. Thomas made submissions about what he thought he could afford and what would be reasonable. He urged this Court to order a lower amount than the trial judge did. [ 63 ] While Mr. Thomas was self-represented at this hearing, he had counsel at the court appealed from. He did not plead undue hardship and his counsel did not lead evidence which would have permitted the type of analysis required under

section 10 . The judge cannot be said to have erred in failing to complete a full analysis and comparison of household incomes when it was not requested, nor was evidence led which would have allowed an analysis of household standards of living to assess a claim of undue hardship. [ 64 ] It would not be appropriate for this Court now to hear evidence and argument on the issue of whether a claim for undue hardship could be made out under

section 10 and undertake the detailed household standard of living comparison required in completing the undue hardship analysis. This is not a trial de novo . [ 65 ] The trial judge properly considered undue hardship in the context of its presentation at the hearing. Sharing the Cost of Access Visits [ 66 ] Mr. Thomas asked this Court to determine how the parties should share the cost of access visits for their son to visit him in the summer. The provisional order and the confirmation order gave credit to Mr. Thomas for the cost of an airline ticket for a past visit to Newfoundland.

There is nothing in the order to deal with future expenses and how, when and where those visits would occur. This Court is not in a position to make such an order. The parties may make an agreement by consent or either of them may make an application to a trial court seeking such an order. Costs [ 67 ] Ms. Thomas seeks costs of this hearing. Her Counsel noted that the trial judge did not order costs despite the confirmation hearing requiring six separate appearances. Counsel for Ms. Thomas speculated that the court may have taken into account the financial circumstances of Mr.

Thomas, including the fact that he likely would have incurred his own legal fees to have counsel represent him at the hearing. Ms. Thomas submits that Mr. Thomas did not disclose financial information until required to by the court below and has been reluctant to pay Guideline support. The ISO process at the confirmation hearing does not require the applicant from another jurisdiction to appear or have counsel present in the reciprocating jurisdiction. The process was designed to minimize the cost of participating parties in different jurisdictions. [ 68 ] At this court, the appearance of Counsel for Ms.

Thomas was helpful and appropriate. This was not a confirmation hearing under the ISO process but rather an appeal. Ms. Thomas is the successful party on the appeal and is entitled to her costs. DISPOSITION [ 69 ] For the reasons outlined, I would dismiss the appeal and uphold the confirmation order with costs on Column 3 of the Scale of Costs in the Court of Appeal Rules . Appeal dismissed.