S.M.R. v. E.L.M., 2019 BCPC 236

Citation: S.M.R. v. E.L.M. 2019 BCPC 236 Date: 20190925 File No: 1240566 Registry: [Omitted for publication] IN THE PROVINCIAL COURT OF BRITISH COLUMBIA IN THE MATTER OF THE FAMILY LAW ACT , S.B.C. 2011 c. 25 BETWEEN: S.M.R. APPLICANT AND: E.L.M. RESPONDENT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE C. MALFAIR Counsel for the Applicant: J. Reed Counsel for the Respondent: S. Walter Place of Hearing: [Omitted for publication] , B.C. Dates of Hearing: June 4, 18, 2019 Date of Judgment: September 25, 2019

INTRODUCTION [ 1 ] This is an application by Mr. M. to retroactively and prospectively vary the child support order of Judge R. Callan pronounced April 13, 2015 (the “Child Support Order”). Mr. M. attended a Family Case Conference on January 27, 2015, where an interim order for child support was made pending his provision of financial information in support of a final order. However, Mr. M.’s counsel subsequently got off the record and the Child Support Order was made in Mr. M.’s absence. [ 2 ] As Mr.

M. had not provided any financial information at the time of the hearing, Judge Callan imputed to him guideline income of $33,100. It was submitted to Judge Callan that this was a fair imputation of income based on an assumption of full time employment at minimum wage plus income from a monthly annuity Mr. M. receives from a structured personal injury settlement. [ 3 ] Mr. M. brought this application to vary the Child Support Order on March 28, 2018.

He argues the imputed income amount was unreasonable and the Judge erred by including a substantial portion of his annuity in the calculation of his income under the Federal Child Support Guidelines . He seeks to retroactively vary the order to reflect his actual income for the years 2015 to present, and vary the amount of child support payable going forward to reflect his current income. Ms. R. argues Mr. M. has been underemployed since the Child Support Order was made, due in large part to his substance abuse problems, and that the order should remain unchanged. Mr.

M. also seeks an order for specified telephone contact time with his son. FACTS In 2010 Ms. R. and Mr. M. met in Winfield, outside of Kelowna, and started dating. Their son, T., was born [omitted for publication]. Ms. R. regularly lived in [omitted for publication] while Mr. M. resided in the Okanagan and Alberta. Mr. M. moved to [omitted for publication] sometime in 2010 and lived independently of Ms. R. The Ministry of Child and Family Development had child protection concerns arising from Mr. M.’s relationship with a prior girlfriend and prohibited him from living with Ms. R. and T. [ 4 ] Ms.

R. claims she first became aware Mr. M. had addiction issues shortly after their son was born. During this time the couple did not live together and Mr. M. moved between [omitted for publication] and Alberta. Ms. R. believed Mr. M. was working on and off as a roofer from 2010 - 2014. She thought he would “go or not go” to work and have others give him a ride to worksites because he had no driver’s licence. Ms. R. assumed Mr. M.’s inconsistent employment as a roofer stemmed from his drug and alcohol addictions. [ 5 ] Ms. R. acknowledges Mr.

M. bounced between different cities of residence between 2010 and 2014 with no real consistent presence in [omitted for publication] where she ordinarily resided with T. Ms. R. described Mr. M. as being “banned” from Vanderhoof for a while. Because they did not live together and Mr. M. did not consistently reside in Vanderhoof, Ms. R. did not know any more about Mr. M.’s employment other than what he told her. Ms. R. says she never really knew what Mr. M. earned. I find Ms. R.’s ability to observe Mr.

M.’s employment, skills, income, and ability to work throughout their relationship and after the birth of their son to be very limited. [ 6 ] In 2014 Mr. M. appeared to be “doing better” and the couple moved in together. Mr. M. secured a job at a local hardware store for $15 per hour, a position he held for only few months. He lost that job around the same time the couple permanently separated due to acts of family violence perpetrated by Mr. M. [ 7 ] On July 4, 2014, Ms. R. applied for orders of guardianship, allocation of parental responsibilities and child support. Mr.

M. filed a Reply on August 20, 2014, seeking an order for parenting time and allocation of parental responsibilities. The parties attended a family case conference on January 27, 2015, in which they entered into an interim without prejudice consent order whereby Mr. M. was afforded specified telephone and skype contact with T. Mr. M. was imputed an income of $21,300 and ordered to pay child support in the guideline amount of $184 per month. He was also ordered to file a Form 4 Financial Statement. The matter was adjourned to March 23, 2015, for review. On March 23, 2015, Mr.

M.’s counsel attended and the review was further adjourned to April 13, 2015. [ 8 ] On April 13, 2015, Mr. M. did not attend Court and his counsel got off the record. Ms. R. was represented by her counsel, Ms. Reed. Counsel for the Ministry of Social Development also made submissions to the Court concerning child support as Ms. R. was on social assistance. At that time there was no application before the Court seeking to vary the interim January 27, 2015 child support order as the originating Application and Reply had only been scheduled for “Review” in anticipation of receiving Mr. M.’s financial information.

The Court proceeded in Mr. M.’s absence as if it were a hearing on the merits of Ms. R.’s originating application for parenting time and allocation of responsibilities and child support. [ 9 ] Mr. M. had failed to comply with the January 27, 2015 order that he file a Form 4 Financial Statement. As such, his real financial information was not before the Court on April 13, 2015. Ms. R.’s counsel advised that Ms. R. was only seeking orders on the issues of guardianship, parental responsibilities and parenting time. The Court made those orders in favour of Ms. R.

Counsel for the Ministry, however, asked the Court to impute a higher income to Mr. M. and order payment of an increased amount of child support. Counsel conceded that Mr. M.’s income was just a “guess”, but nonetheless invited the Court to impute a guideline income to Mr. M. of $33,100. The Ministry stated the $21,300 income imputed at the Family Case Conference was based on full time minimum wage employment, and that this amount should be increased to $33,100 to reflect Mr. M.’s receipt of a structured settlement annuity. [ 10 ] Counsel for the Ministry advised that it was relevant to determine how much of Mr.

M.’s structured settlement was attributable to “wage loss,” but in the absence of any information from Mr. M. about the settlement the Ministry was left to guess at how much should be included as Guideline income. Ultimately the amount proposed by the Ministry and imputed by the court, being $11,800, represented 61% of Mr. M.’s annuity benefits at that time. It was suggested that if this number was too high Mr. M. could come back and seek to vary the order. [ 11 ] There was no evidence put before the Court as to Mr. M.’s employment history, skills, health, or ability to earn an income. In fact, Mr.

M.’s 2015 income was $9,192 - less than half of the employment income imputed to him. The Court acceded to the Ministry’s submissions and ordered Mr. M. to pay child support in the amount of $300 per month based on an imputed annual Guideline income of $33,100. The Court had authority to impute income to Mr. M. pursuant to s. 19(1)(

f) of the Guidelines on the basis he failed to file his

financial information when ordered to do so. [ 12 ] Mr. M. says at the time the Child Support Order was made he was in Vernon working in a hospital. He could not really remember how he came to fall out of contact with his counsel and testified he was not really aware of what was happening with these Court proceedings. Mr. M. says that within two weeks of the Child Support Order being made in his absence he fell into deep addiction, unemployment and homelessness. During that time he slept on park benches or tents and was not employed. He continued in that lifestyle for 9 -10 months.

In February 2017 he obtained some legal advice from advisors in the Kelowna Courthouse and filed an application to vary the April 2015 Child Support Order. That application was withdrawn and replaced with a new Application (prepared with the benefit of counsel) on March 28, 2018, which is the subject of this hearing. [ 13 ] Mr. M. is 39 years old. He has a grade 9 education. When he was 8 years old he was hit by a car while riding his bike. He was seriously injured to the extent of paralysis (which subsequently healed). Mr.

M. says he also suffered a traumatic brain injury which has interfered with his ability to hold down a job due to memory impairments. In 2016 - 2017, he primarily worked through temporary employment agencies picking up intermittent work as a labourer. Due to prior driving offences and $12,000 in unpaid fines Mr. M. has no driver’s licence and cannot legally drive. He has not had a driver’s licence since before 2010, which he lost while living in Alberta. Mr.

M.’s inability to drive limits his employment options given his skill set, as it is difficult for him to obtain transport to project sites, construction sites or resorts. [ 14 ] Mr. M. suffers from a longstanding addiction to crack cocaine and alcohol. Mr. M. says he has been a “screw-up” for most of his life. He claims he quit crack cocaine last summer “cold turkey”, and has voluntarily reduced his alcohol intake to sociable levels. Much of Mr. M.’s employment and relationship difficulties directly related his addictions. Mr. M.’s break-up with Ms.

R. was violent and resulted in criminal charges against him. [ 15 ] In addition to his addictions, Mr. M. suffers lingering medical issues from his childhood accident which impede his ability to work. Mr. M. says he has difficulty remembering things, like instructions or recipes, which frustrates his employers who end up firing him. He had a cooking job at a resort this year which he lost after a few weeks due to this problem. He suffers stiffness and soreness in his legs which causes him increasing pain with age. He also suffers from painful swelling in one of his legs.

These physical ailments hamper his ability to do physical labour such as roofing. [ 16 ] Ms. R. contests Mr. M.’s claim that he suffers from memory deficits, however, she agrees Mr. M. suffers painful swelling in one of his legs as she observed him seek medical attention and prescriptions for that condition during their relationship. [ 17 ] Mr.

M.’s historical income as reported on line 150 of his annual tax returns, attached to his Financial Statements filed February 28, 2017, and June 3, 2019, is as follows: 2013: $320.39 2014: (missing) 2015: $9,129 2016: $6,249 2017: $5,393 2018: $18,152 ($15,950 in employment income, $2,201 in Worker’s Compensation Benefits) [ 18 ] Mr. M. attributes his improved 2018 income to his cessation of drug use and curtailment of alcohol consumption. He says he quit using drugs last year by force of will without going to treatment.

His 2018 income included $2,201 for Worker’s Compensation benefits arising from a kitchen accident where he sliced his hand with a meat slicer. From 2015 - 2018, Mr. M.’s sources of income were primarily from casual day labour obtained through placement services or brief periods of employment with various companies in low- skilled positions. In 2018 - 2019, he was able to work as a cook for around $15 per hour. Mr. M. says the highest wage he ever earned was $18 per hour when he worked as a roofer. [ 19 ] In July 2018 Mr. M. got a job as a cook in a restaurant in [omitted for publication].

After a couple of months he cut his hand and was off for months on WCB. He says he was ultimately let go from that job. In January 2019 Mr. M. got a job as a cook in [omitted for publication] but quit after a few months because he did not like working in a bar given his addiction issues. He secured another job as a cook but the restaurant was larger, busier and he could not remember the recipes, so he was fired after a couple of weeks. In May 2019 Mr. M. got a job as a handyman at a resort for round $15 per hour, but quit his job after a few weeks because he was not getting paid.

At the time of hearing he was unemployed and searching for work. I note that the $15 per hour Mr. M. was earning on average in 2018- 2019, was around 20% above minimum wage. [ 20 ] The most lucrative employment years Mr. M. says he ever enjoyed was when he worked as a roofer in 1996, 1997, and 2000. During that time he could earn up to $2000 bi-weekly seasonally. Since then he says he worked as a roofer intermittently. He worked in Alberta from 2006 - 2007, but had to stop due to leg pain issues and transportation problems getting to work sites.

The last time he worked as a roofer was in 2017 where he performed one 5 day job for $16 per hour. He does not have fall certification which is now required to be a roofer and says his leg swelling and ankle pain problems nonetheless preclude him from that occupation. He also continues to have difficulty getting to job sites because he has no driver’s license. He does have his Foodsafe certificate to work in restaurants and can manage working as a painter. [ 21 ] Under his structured settlement Mr. M. receives a monthly annuity which increases by 3% annually.

The monthly amounts he received since 2015 are: 2015: $1,604.88

2016: $1,656.70 2017: $1,706.40 2018: $1,757.59 2019: $1,810.32 [ 22 ] Mr. M. lives a meagre lifestyle. He resides in Kelowna, in part, because he has close relationships with friends and their children. In 2016 he secured a job earning $16 per hour doing lawn maintenance at a resort, but had to quit because the premises was a 90 minute drive from his residence and he had no reliable means of transportation. He did have the opportunity to get a labour job in Penticton but did not wish to move because his family and friends are in Kelowna. [ 23 ] Mr.

M. received a lump sum payment of $72,000 from his structured settlement in 2012. He admits he could have used those funds to pay off his driving fines in an effort to regain his driver’s license, but did not. Mr. M. says he gave some of the payment to family and used the balance to support himself, Ms. R. and T., as they were together at that time. He says he purchased phones, vehicles and other items for family use. Ms. R. disputes this assertion. She recalls Mr.

M. was living in Alberta at that time because he had been arrested there and was not permitted to leave that province, so he used the half of the lump sum money for his own living expenses. He gifted the other half to his stepfather. He did not use the funds for T.’s benefit. [ 24 ] Mr. M. says he has tried to be employed since dropping out of school in grade 9 but has not been successful in securing and maintaining a long term job. He says he doesn’t know why this is the case. He acknowledges there were times he was fired for missing work and periods where he relied on social assistance. [ 25 ] Ms.

R. says that she and Mr. M. took a 3 month job skills course at the College of New Caledonia in 2013, which was offered to persons on social assistance. Neither she nor Mr. M. completed the course. Ms. R. felt the environmental work for which she was being trained was “not for her.” Ms. R. says that she observed Mr. M. to be capable of reading materials and making presentations to the class, and did not appear cognitively unable to deal with the course. [ 26 ] Mr. M. has almost no relationship with his son. Ms. R. says T. does not know who his father is and they don’t really talk about it. Mr.

M. says he has made efforts to call his son but his calls go unanswered or he ends up arguing with Ms. R. Due to family violence perpetrated by Mr. M., there were periods where he was barred from living in Vanderhoof and/or communicating with Ms. R. which further contributed to Mr. M.’s separation from T. There was a lengthy period where the Ministry of Child and Family Development also put restrictions on Mr. M.’s contact with T. due to family violence. Mr. M. did not prioritize maintaining his relationship with his son during his intense periods of drug use. [ 27 ] Ms. R. says she has not tried to block Mr.

M.’s contact with his son, rather, it is Mr. M. who is inconsistent or lacking in his efforts to talk to T. I find the real cause of Mr. M.’s poor relationship with T. is due to his historical drug use, family violence, and inaction, not any obstructive efforts by Ms. R. Mr. M. seeks further contact time with T. but Ms. R. is reticent because she worries T. would be negatively affected by expecting to speak to his father and Mr. M. not following through. Mr.

M. admits that he chose to “back away from communicating with his son so as not to confuse him.” When asked if re-introducing T. to his father and arranging monthly phone contact would be disruptive to T., Ms. R. said she did not know. [ 28 ] Mr. M. is $1,847.29 in arrears of child support. The Family Maintenance Enforcement Program (“FMEP”) calculates that Mr. M. also owes $252.71 in interest on those arrears and attributes $600 in default fees to Mr. M., for a total of $2,700.01. Presently, FMEP holds $2,867.84 in trust as a result of garnishments it executed against Mr.

M.’s sources of income pending the outcome of Mr. M.’s application. ISSUES [ 29 ] The issues I must decide are:

a) whether or not the Child Support Order should be retroactively varied to reflect Mr. M.’s historical income;

b) whether income ought to be imputed to Mr. M. for the purposes of determining support under the Guidelines on the basis that: a. he has been underemployed since the Child Support Order was made; and/or b. he receives a monthly annuity from his personal injury settlement; and

c) whether specified contact time should be ordered. ANALYSIS 1. Should the Child Support Order should be retroactively varied? [ 30 ] Mr. M. applies to retroactively vary the amount of child support payable since the Child Support Order was made to reflect his actual historical income. As such it is properly characterized as being brought under s. 152 of the Family Law Act , SBC 2011, c 25 (“ FLA ”), which provides: 152

(1) On application, a court may change, suspend or terminate an order respecting child support, and may do so prospectively or retroactively.

(2) Before making an order under subsection (1), the court must be satisfied that at least one of the following exists, and take it into consideration:

(

a) a change in circumstances, as provided for in the child support guidelines, has occurred since the order respecting child support was made; (

b) evidence of a substantial nature that was not available during the previous hearing has become available; (

c) evidence of a lack of financial disclosure by a party was discovered after the last order was made. [ 31 ] In an application for the retroactive reduction of child support based on a change of circumstances, it is necessary to consider the four factors set out by the Supreme Court of Canada in D.B.S. v. S.R.G., 2006 SCC 37 (see G.M.W. v. D.P.W. , 2014 BCCA 282 ; C.A.O. v. P.A.O, 2017 BCPC 361 , at par. 88 ; Sijercic v. Kazic, 2016 BCSC 186 at par. 63 ; and M.H. v. A.M. , 2016 BCSC 1664 at par. 170 ). The four relevant factors are: (

i) the circumstances surrounding the delay in bringing the application; (ii) the payor parent's conduct; (iii) the children's circumstances; and (iv) any hardship caused by a retroactive child support order. Material Change in Circumstances [ 32 ] In order to succeed with an application to vary an order under s. 152 of the FLA , Mr. M. has to prove a material change of circumstances within the meaning of the Guidelines. This means a change such that, if known at the time the order was made, would likely have resulted in different terms ( G.M.W. v. D.P.W. , para. 32 ).

Section 14 of the Guidelines also defines the kinds of changes in circumstance justifying the variation of a child support order: 14. For the purposes of [

section 152 of the FLA ], any one of the following constitutes a change of circumstances that gives rise to the making of a variation order in respect of a child support order: (

a) in the case where the amount of child support includes a determination made in accordance with the applicable table, any change in circumstances that would result in a different child support order or any provision thereof; (

b) in the case where the amount of child support does not include a determination made in accordance with a table, any change in the condition, means, needs or other circumstances of either spouse or of any child who is entitled to support; … [ 33 ] The material change of circumstances Mr. M. asserts is his actual employment income is significantly less than the $21,300 per annum imputed to him for 2015 and each and every year thereafter. This change was significant and long-lasting, as he has never earned close to that amount of income until 2018.

He also says the amount imputed to his income from the annuity, $11,800, exceeded what was legally permissible based on the character of the underlying settlement. [ 34 ] Because Mr. M. had failed to file his financial information as ordered, Judge Callan needed to impute income to him so a final child support order could be made. However, in order for the court to impute income to a payor there must be some evidence upon which that income can be ascertained. Mr. M. was not present when the Child Support Order was made and counsel for the Ministry of Social Development, who was acting on behalf of Ms.

R. in the child support claim, invited the court to impute income based on full time employment at minimum wage plus part of his annuity. There was no evidence before the Court that Mr. M. ever worked regular, full time employment. Ms. R. claims she had “no idea” what Mr. M. was earning at the time the Child Support Order was made. However, she did know Mr. M. had addiction issues, that he had lost his job shortly before they permanently separated, and that there were times Mr. M. was collecting social assistance. Ms. R. knew Mr.

M. did not maintain stable employment because he often failed to show up for work. [ 35 ] I find there was little or no evidence to support the inference that Mr. M. did or was capable of working regular, full time employment at the time the Child Support Order was made. Ms. R. was aware Mr. M. was addicted to crack cocaine and alcohol to the point he did not maintain steady employment, however, this fact was not communicated to Judge Callan. In saying this I do not suggest any improper conduct by Ms. R. The Child Support Order and imputation of income was not sought by Ms. R. or her counsel.

It was sought by the Ministry of Social Development which was seeking child support to recoup social assistance funds expended to Ms. R. for T.’s support. The Ministry’s counsel may not have had much information about Mr. M.’s situation and was compelled to “guess” at an imputed income because of Mr. M.’s complete failure to file financial information. [ 36 ] I find the large disparity between Mr. M.’s actual income and his imputed income, which disparity continued to persist after the Child Support Order was made, constitutes a material change in circumstances.

I also find there is a material change in circumstances on the basis that too much of Mr. M.’s annuity payments were imputed to his Guideline income as set out later in these Reasons. Information about Mr. M.’s actual income and structured settlement was not before Judge Callan at the time the Child Support Order was made, and I am satisfied that had the information been known to Judge Callan he would have made a different order. Circumstances Surrounding the Delay in Bringing the Application [ 37 ] Mr. M. was homeless and deeply addicted for almost a year after the Child Support Order was made.

He did make an application to vary the Child Support Order on February 28, 2017, around 2 years after the order was made, saying “need support payments lowered retroactive to January 2014” on the basis “I was working at the time of the order now over the last couple years I have not.”

[ 38 ] Mr. M.’s application failed to indicate a mailing address. There is a note in the Court file from Mr. M., filed March 27, 2017, asking the Court to send his mail to a new address in Kelowna. There is no record of a hearing date being set in connection with Mr. M.’s application. My review of the court file shows no proof of service of Mr. M.’s application on Ms. R., which likely precluded his application from proceeding further. [ 39 ] On November 3, 2017, Mr. M. filed a notice of change of address indicating Simon Walter as his counsel and requesting a copy of the Court records. On March 8, 2018, Ms.

R. was served with Mr. M.’s application to vary child support and a further Application seeking parenting time filed April 19, 2017. Mr. M.’s 2017 Applications were withdrawn and replaced with the current application filed March 28, 2018, which was prepared by counsel. [ 40 ] As such, Mr. M. delayed a little less than two years in bringing his application to vary the Child Support Order. After February 2017 there was some delay in getting the matter to hearing as Mr. M.’s application was not served on Ms. R. until he retained counsel in late 2018. I accept Mr.

M. was still dealing with an acute drug and alcohol addiction during those years. The evidence discloses he was not regularly employed and did not maintain regular contact with his son. [ 41 ] The amount of employment income imputed to Mr. M. in the 2015 Child Support Order far exceeded his actual employment income up to the time he applied to vary the Order. Mr. M. gained nothing from allowing the Order to continue in force as it stood.

I accept that the reason he delayed in bringing the application was because he was so deep in his addictions or homelessness that he was not in a position to address the issue. [ 42 ] While Mr. M. delayed almost two years in bringing the application, I find the circumstances of that delay are not such that he should be precluded from retroactively varying the order. He was suffering from serious addictions and/or homelessness which impeded his ability to fully attend to his family court legal obligations and he initially tried to proceed without the benefit of counsel which contributed to the delay.

The Payor Parent’s Conduct [ 43 ] Blameworthy conduct on the part of the payor can militate against a retroactive reduction in child support payments. Ms. R. argues that Mr. M.’s choice to spend his income and annuity on alcohol and drugs, rather than his son, is blameworthy. She also complains that Mr. M. gave half of his $72,000 lump sum annuity payment to his stepfather and provides some financial support to daughters of his friends when his first priority should be supporting his own child. [ 44 ] For the reasons set out below with respect to the issue of underemployment. Mr.

M.’s priority expenditures on substances to which he is addicted cannot be characterized as blameworthy conduct for the purposes of assessing whether he ought to be precluded from retroactively reducing child support under s.152 of the FLA . [ 45 ] As stated above, I find Mr. M.’s failure to attend court and file financial information was due in part to his addictions as opposed to a deliberate attempt to frustrate payment of his support obligations. He initially attended court hearings, retained counsel, and consented to a child support order based on a generously estimated income of $21,300 in January 2015.

The matter was adjourned to April 15, 2018, for a “Review” in anticipation of receiving financial information from Mr. M. At the time Mr. M. had counsel. It would not necessarily have been obvious to Mr. M. that the child support order made only four months earlier might be substantially increased in his absence, as there was no filed application seeking that relief. Mr. M. was living and working in Vernon at the time, which is hundreds of kilometres from Prince George where the matter was heard. [ 46 ] Mr.

M.’s participation in the Court proceedings waned commensurate with his increasing substance abuse and associated homelessness. The Child Support Order was made in his absence based on inaccurate information concerning his ability to earn an income. While his conduct was avoidant and less than optimal, it was not deliberate or calculated to prejudice Ms. R. or undermine the authority of the Court. The Children’s Circumstances [ 47 ] T. is a young child in grade 2 and will be financially dependent on his parents for many years to come. Ms.

R. does not work and the family relies on social assistance, which enhances T.’s need for ongoing financial support from his father. It would harm T.’s financial security to retroactively adjust child support in a manner which would create a debt from his mother to Mr. M. for the reasons set out below. Hardship [ 48 ] I understand Mr. M. is not suggesting that any retroactive variation of child support should operate such that Ms. R. would suddenly be expected to re-pay an overpayment of child support arising from the retroactive adjustment. In my view such an order would create a hardship to the recipient, Ms.

R., who relies on social assistance, was only receiving small sums of child support, and is the sole supporter for T. She has no realistic means of reimbursing Mr. M. for any overpayments of child support and would not have anticipated this expense given she had no notice of Mr. M.’s intention to retroactively reduce support until she was served in March 2018. [ 49 ] I also find it would create a hardship if the retroactive variation of the Child Support Order resulted in the creation of a debt from Ms. R. to Mr. M. which was resolved by way of crediting Mr. M. future child support payments to offset that debt.

T. still needs support from his father. Mr. M. has the means to continue to make support payments for the benefit of his son and should do so even if, mathematically, a historical adjustment of his income would technically result in a credit or overpayment of child support. [ 50 ] Between his paid employment and annuity Mr. M. has a higher income than Ms. R. I find that provided any retroactive adjustment of the Child Support Order does not contemplate the creation of a debt from the recipient to the payor, a retroactive variation would not create a hardship to Ms. R. or T. Conclusion

[51] In all of the circumstances and applying the principles set out in D.B.S. and the Guidelines, I find the Child Support Order oughtto be retroactively varied pursuant to s. 152 of the FLA to reflect Mr. M.’s adjusted imputed income as contemplated herein. 2. Should Income Be Imputed to Mr. M. On The Basis of Underemployment? [52] Ms. R. says the Court ought not to retroactively reduce Mr. M.’s historical child support obligations commensurate with hisactual income because he has been underemployed since the Child Support Order was made.

She argues the imputed income amount inthe Child Support Order is fair and appropriate given Mr. M.’s underemployment. Ms. R. says that since 2015, Mr. M. has had theability to work as a roofer or cook but has not reasonably pursued these occupations on a full time basis or maintained his employment.She submits BC roofers earn on average $25.61 an hour and line cooks earn $13.80 per hour. [53] I find that Mr. M.’s leg condition and lack of fall certification preclude him from working regularly as a roofer.

I accept that Mr.M.’s memory and cognitive functions are somewhat diminished in a fashion which limits his ability to successfully work in morechallenging and intellectually demanding work environments. These limitations were apparent to me during his testimony. [54] In my view Mr. M.’s physical and cognitive abilities, education and skill set really only qualify him to work modest wage leveljobs such as a general labourer, painter, or entry level cook. The real issue is whether or not Mr.

M. has been underemployed in thoseoccupations for which he is suited because he has not pursued or maintained regular full time employment. Had he done so, his incomewould at least have been equivalent to full time minimum wages. When the Child Support Order was made, counsel for the Ministry ofSocial Development estimated such annual income to be $21,300, the amount imputed to Mr. M. in the January 2015 child support order. [55] The main impediment to Mr. M.’s regular gainful employment was his substance abuse.

There are occupations available to Mr.M. despite his limited education and abilities, the real challenge has been Mr. M. retaining those jobs. I find as a result of his substanceabuse problems Mr. M. was habitually fired, stopped showing up, or just quit the jobs available to him. His addictions also lead tomultiple driving offences which resulted in the loss of his license.

Being unable to drive can have a significant impact on someone whoseskill set generally requires them to travel to work sites not accessible by public transportation. [56] The parties’ submissions raise the timely question: for the purposes of determining a payor’s ability to work and pay childsupport, is addiction considered a disability or a choice? The former might excuse a payor’s failure to pay, while the latter does not. [57] An analysis of this issue requires an examination of the legislative framework around child support as well as the relevant caselaw.

Counsel have provided the Court with the following authorities: A.B.M.E. v. D.J.H., 2012 BCSC 483 , M.K. v. R.A.S., 2004BCSC 1798 ; Yeung v. Silva, 2016 BCSC 1682; L.F. v. C.G.C., 2014 BCSC 1069 ; JWK v. EK, 2014 BCSC 1635;Mason v Mason, 2013 ONSC 5974 and Brown v. Golaiy, (BCSC). [58]

Section 147 of the FLA imposes a duty on each parent and guardian to support a child under the age of 19 except incircumstances that are not present in this case. When making an order respecting child support, s. 150 of the FLA compels the Court todetermine the amount in accordance with the Guidelines unless the parties have an agreement for some other amount and the court issatisfied that reasonable arrangements have been made for the support of the child. The principles on which child support is based, asespoused Earle v.

Earle, 1999 BCSC 283, are as follows: a. parents have a joint and ongoing obligation to support their children; b. child support belongs to the child; and c. the amount of child support is based not only on the parents’ earnings, but also on what the parent can earn. [59] The Guidelines objectives are: a. to establish a fair standard of support for children that ensures that they continue to benefit from the financial means of bothspouses after separation; b. to reduce conflict and tension between spouses by making the calculation of child support orders more objective; c. to improve the efficiency of the legal process by giving courts and spouses guidance in setting the levels of child support ordersand encouraging settlement; and d. to ensure consistent treatment of spouses and children who are in similar circumstances. [60] The amount of a child support order for a child under 19 years old is presumed to be that amount set out in the applicableGuidelines tables based on the payor’s income (Guidelines, s. 3).

With some exceptions, a payor’s annual income is determined using thesources of income set out under the heading “Total income” in the T1 General Form issued by the Canada Revenue Agency and isadjusted in accordance with

Schedule III of the Guidelines (Guidelines, S. 16). [61]

Section 19 of the Guidelines permits the court to depart from the methodology set out in s. 16 and “impute such amount ofincome to a spouse as it considers appropriate in the circumstances.” Although there are nine statutorily defined situations, it is not anexhaustive list and the

section gives the court significant discretion in imputing income.

Section 19 states: Imputing income 19

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

a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required bythe needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;

(

b) the spouse is exempt from paying federal or provincial income tax; (

c) the spouse lives in a country that has effective rates of income tax that are significantly lower than those in Canada; (

d) it appears that income has been diverted which would affect the level of child support to be determined under these Guidelines; (

e) the spouse’s property is not reasonably utilized to generate income; (

f) the spouse has failed to provide income information when under a legal obligation to do so; (

g) the spouse unreasonably deducts expenses from income; (

h) the spouse derives a significant portion of income from dividends, capital gains or other sources that are taxed at a lower rate thanemployment or business income or that are exempt from tax; and (

i) the spouse is a beneficiary under a trust and is or will be in receipt of income or other benefits from the trust. [62] In Yeung v. Silva, Madam Justice Dardi canvassed the law on imputing income at paras. 43–47: [43] The court has a broad discretion to impute income to either or both spouses for the purposes of determining child and spousalsupport. The court’s discretion to impute income recognizes that insofar as it is practicable, and having regard to all of the circumstances,spouses seeking support are required to make reasonable efforts to support themselves: McCarthy at para. 34. [44] Ms.

Yeung is obligated to contribute to the support of her son. It follows that the imputation of income to her involves considerationof the guiding principles set out in s. 19(1)(

a) of the Guidelines. [45]

Section 19 of the Guidelines permits the court to impute income in several scenarios, including where a parent is intentionallyunder-employed or unemployed, appears to have diverted income, or has failed to provide obligatory income information. The court’spower to impute income under s. 19 is not limited by the restrictions set out in ss. 16-18 of the Guidelines: Ouellette v.

Ouellette, 2012BCCA 145 at para. 66. [46] Imputing income for intentional unemployment or under-employment does not require a finding of bad faith on the part of thespouse in respect of whom imputation is sought; it only requires a finding that he or she is not earning to capacity: Beissner v. Matheusik,2014 BCSC 1785 at para. 37, aff’d 2015 BCCA 308 . [47] In Schmidt v. Sucke, 2013 BCSC 1489 , Madam Justice Fisher distilled the principles which inform the court’s analysis ofthe imputation of income for child support purposes at para. 45: (

a) Parties liable to pay child support cannot avoid their responsibilities simply by virtue of being under-employed (Van Gool v. VanGool (1998), (BC CA), 59 B.C.L.R. (3d) 395 (C.A.) at para. 31). (

b) Parents have a joint and ongoing legal obligation to support their children and must earn what they are capable of earning. The courtgives effect to this obligation by imputing income (Hanson v. Hanson, (BC SC), [1999] B.C.J. No. 2532 at paras. 8-9). (

c) Bad faith is not required. A parent is intentionally under-employed if he chooses to earn less than he is capable of earning (Hanson atpara. 13). (

d) When imputing income due to intentional under-employment, the court must consider what is reasonable in the circumstances,including the age, education, experience, skills and health of the parent, and other matters such as the availability of work (Hanson atparas. 14 and 20). (

e) A parent who chooses to work less than full time must justify that choice by the needs of the children. (Mahannah v. Mahannah, 2012 BCSC 403 at paras. 122-123; McCaffrey v. Paleolog, 2011 BCCA 378 at para. 49). [63] She continues at paras. 51-52: [51] The imputation of income is not the product of speculation or guess work. The party seeking to have income imputed -- in this caseMr. Silva -- must establish an evidentiary basis for such a finding: Marquez at para. 36.

If the court determines that one or both of theparties' stated incomes do not represent their "means" (interpreted to include all pecuniary resources from which a person receives gainsor benefits) or their ability to earn income, it may impute income at a level commensurate with their means: L.F. at para. 153. [52] The amount imputed must align with a realistic reflection of the party's education, work history, skills, age and any health conditionsthat may adversely impact the party from a vocational standpoint: Cotter v.

Cotter, 2015 BCSC 1730 at para. 49, aff'd 2016 BCCA 254;Marquez at para. 37. [64] Legal principles relating to an assessment of whether or not income ought to be imputed on the basis of underemployment werealso summarized by the Court of Appeal in Beisner v. Matheusik, 2015 BCCA 308 at par. 44: 44 Third, the judge found that the father was underemployed. In reaching that finding, the court did not have to conclude that the fatherwas intentionally evading or minimizing his child support obligation or that he was intentionally underemployed or unemployed.

It onlyhad to determine what income the father was capable of earning: Barker v. Barker, 2005 BCCA 177. The test for a finding ofunderemployment from Donovan v. Donovan, 2000 MBCA 80, was adopted by this Court in Watts v. Willie, 2004 BCCA 600 at para.16, and followed in McCaffrey v. Paleolog, 2011 BCCA 378 at para. 46:

[16] In Donovan v. Donovan (2000), 190 D.L.R. (4th) 696, 2000 MBCA 80, Madam Justice Steel gave the judgment of the court andwrote at para. 21: The following guidelines may be considered when determining whether to impute income. (See Dr. Julien D. Payne, Imputing Income,"Determination of Income, Disclosure of Income", Child Support in Canada, Canrab Inc., August 3, 1999). 1. There is a duty to seek employment in a case where a parent is healthy and there is no reason why the parent cannot work.

It is "noanswer for a person liable to support a child to say he is unemployed and does not intend to seek work or that his potential to earn incomeis an irrelevant factor" (Van Gool v. Van Gool (1998), (BC CA), 166 D.L.R. (4th) 528 (B.C.C.A.)). 2. When imputing income on the basis of intentional under-employment, a court must consider what is reasonable under thecircumstances. The age, education, experience, skills and health of the parent are factors to be considered in addition to such matters asavailability of work, freedom to relocate and other obligations. 3.

A parent's limited work experience and job skills do not justify a failure to pursue employment that does not require significant skills,or employment in which the necessary skills can be learned on the job. While this may mean that job availability will be at the lower endof the wage scale, courts have never sanctioned the refusal of a parent to take reasonable steps to support his or her children simplybecause the parent cannot obtain interesting or highly paid employment. 4. Persistence in unremunerative employment may entitle the court to impute income. 5.

A parent cannot be excused from his or her child support obligations in furtherance of unrealistic or unproductive career aspirations. 6. As a general rule, a parent cannot avoid child support obligations by a self-induced reduction of income. [Emphasis in original.] [65] The Court’s approach to the issue of imputing income to a payor parent with a substance addiction problem is evolving. InHutchison v. Gretzinger, (ONCJ), Justice Quinn rejected substance addiction as a justifiable excuse in the absence ofcogent evidence.

He states: [22] The trial judge accepted the affidavit of the legal assistant to counsel for the respondent as evidence that the respondent wasaddicted to drugs, including cocaine. In my view, it was an error to do so: better evidence was required. However, even if one were toaccept that the respondent is a drug addict, his addiction is not a defence to a support claim. When one first consumes illicit drugs, onemust be taken to know that addiction can result: addiction is a reasonably foreseeable consequence, as is the resultant loss of income oremployment.

To the extent that drug addiction is properly viewed as an involuntary illness, the initial drug use is voluntary and,therefore, it is intentional. It is wrong in law (and contrary to public policy) that a parent be exempted from his or her child supportobligation because of drug addiction. As was said by Eberhard J. in another context, "He may someday have better ability to pay andthere is no reason why the arrears should not be there waiting for him": see Courchesne v. Courchesne, [2004] O.J. No. 442 (S.C.J.) atpara. 13. [66] In Kalanuk v. Michelson, 2010 SKQB 394 , Mr.

Kalanuk sought a reduction in his arrears of child support which hadaccrued after he became addicted to drugs and incarcerated for fraud. The Queen’s Bench of Saskatchewan accepted Mr. Kalanuk had aserious drug addiction that impaired his ability to work. Justice Ball viewed Mr. Kalanuk’s alcoholism and drug addiction as illnessesrequiring treatment rather than “unacceptable conduct based on individual choice” (par. 14). Justice Ball concluded Mr.

Kalanuk was notintentionally underemployed during the period of time that he was in drug treatment facilities and his significant decrease in income wassubstantially connected to his addictions issues. However, the court also found Mr. Kalanuk squandered some of his income over thepast four or five years on choices unrelated to his addictions. Although Mr. Kalanuk’s addiction did not absolve him of all responsibilityfor child support, the court reduced his child support arrears because of it. [67] In A.B.M.E. v.

D.J.H., 2012 BCSC 483, the payor father, D.J.H. worked in construction earning around $50,000 per year whenhis children were born. After separation he was imputed an income of $55,000 and ordered to pay child support based on that amountfollowing his failure to file financial information with the court. Later that year he became addicted to crack cocaine and alcohol for twoyears as a result of his depression.

He brought an application to retroactively vary the original child support order on the basis that hisactual income for the preceding three years ranged from $4,000 to $10,000, most of which was social assistance payments. [68] The payor possessed a breadth of construction skills and earned $46,000 - $53,000 in the years preceding separation. Heattributed his subsequent period of unemployment to his addictions and argued his addictions should be treated as a non-culpable healthissue.

Master McDiarmid framed the issue before him as follows: Can a parent can avoid support obligations by choosing to use addictive substances, getting addicted, becoming disabled by theaddiction, and relying on that disability to excuse some or all obligations he has toward his children? [69] In his decision Master McDiarmid cited the decision of Judge Cowling in R.P. v.

M.H.E., 2003 BCPC 407, who concluded atpar. 7 that the “recent legal model for consideration of a party with a substance addiction is to treat that problem as a non-culpable healthissue.” At the same time, Judge Cowling recognized there were competing policy reasons not to accept addiction as grounds forcomplete exemption from a support obligation, and expressed reluctance “to excuse the applicant entirely from his obligation to supporthis child in circumstances whether the problem causing the reduction in income is arguably a mixture of both a health issue and possiblya character issue” (at par. 9).

He concluded it was appropriate to confirm some of the arrears to preserve that resource for the childshould the payor ever become capable of paying. [70] Master McDiarmid stated that “addicts retain some power of choice about whether to consume drugs or not, but that ability tochoose diminishes as a consequence of the psychological and physiological impact of addiction” (par. 26). He referenced the SupremeCourt of Canada’s Insite decision, Canada (Attorney General) v. PHS Community Services Society, 2011 SCC 44, in which the Chief

Justice affirmed the findings of the trial judge that addiction is a disease in which the central feature is impaired control over the use ofthe addictive substance (par. 101).

However, Master McDiarmid cautioned at par. 40: Even though addiction is an illness, starting on the path that leads to addiction is a matter of choice, and the respondent should havechosen to do something productive in order to look after his children. [71] Master McDiarmid found the payor had only ever made two voluntary payments of child support over a five year period, andhis evidence of how his addiction impaired his ability to work was insufficient in many respects. There was no evidence adduceddetailing anything about the payor’s addiction.

The Master adjourned the issue of cancelling arrears to allow the payor to adduce furtherevidence. [72] Following the Supreme Court of Canada’s Insite decision, the B.C. Court of Appeal in R. v. Hansen, 2012 BCCA 142, held in acriminal context that addiction is a disease and that the consumption of drugs is not a simple "choice" to be either made or not made, butan illness "characterized by a loss of control over the need to consume the substance to which the addiction relates" (at. par. 26). [73] The Supreme Court of Canada’s Insite decision and A.B.M.E. v.

D.J.H. informed Judge McCarthy’s approach to addictions inthe family law context in M.S.B. v. L.M.B., 2012 BCPC 520, in which he states: [78] Having regard to the authorities before me, I have come to the conclusion that the crack cocaine addiction to which the husband hastestified is indeed, as has been conceded, a significant material change in circumstances, and one which I must take into account.

Buthaving taken that into account, I agree with the thrust of some of the other authorities, which I have cited, that it cannot be held to be atotal excuse for or an explanation for the reduction of the maintenance obligations of the husband in this matter. [74] Few other courts have considered the Insite decision in the family law context, perhaps because the focus of the inquiry hasbeen on evidentiary issues. In Lindsay v. Jeffrey, 2014 ONCJ 1, the mother asked the court to impute income to the father at the level hewas earning before he quit his job as a mechanic.

The father claimed he was unemployed because of his drug addiction. The courtendorsed the approach of Justice Ball in Kalanuk v. Michelson but only with proper evidence. Justice Sherr for the Ontario Court ofJustice stated at para. 39: [39] This court endorses the approach taken in Kalanuk. The ravages of drug and alcohol addiction are observed weekly in this court incustody/access and child protection cases.

Many parents who love their children very much and are very motivated to play an importantrole in their children’s lives have their roles in their lives profoundly reduced or even eliminated because they have a substance addictionover which they have little control. This court views substance addiction as a health issue. With proper evidence, this court is willing toconsider that substance addiction is a reasonable health need of a parent that can justify underemployment or unemployment, pursuant toclause 19(1)(

a) of the guidelines. [Emphasis added in the original] [75] Justice Sherr found the required evidence lacking in the case before him. The father adduced no corroborating evidence on theextent of his drug use, whether it justified quitting his mechanic’s job, how it adversely affected his ability to work, and for what periodof time it stopped him from working to his full capacity. Justice Sherr stated at para. 40: [40] The required evidence was lacking in this case. It is not enough for a payor to come to court and state: “I am a drug addict and this iswhy I haven’t worked”.

The only corroborative evidence of the father’s addiction was a certificate that he completed a 60-day daytreatment program (that was completed prior to the start date of this order). The court received no medical evidence about the father’scondition. Cogent medical evidence in the form of detailed medical opinion should be provided by the payor in order to satisfy the courtthat his reasonable health needs justify his decision not to work. See: Cook v. Burton (ON SC), [2005] O.J. No. 190(SCJ) and Stoangi v. Petersen (ON SC), [2006] O.J. No. 2902 (SCJ).

The court received no corroborative evidenceabout the extent of the father’s drug use, how it adversely affected his ability to work and for what period of time (if any) this preventedhim from working to his full capacity. As a final point, the court said it initially had “some sympathy” for the father over his drug issues,that sympathy had been “squandered”: The court learned that “despite not paying any child support (and purportedly having nominalincome) he purchased, in 2012, a truck for $6,000 and a 60-inch color television for $1,300.

These are not the actions of a person withlimited means.” [76] For child support purposes, the court imputed to the father income in an amount which slightly exceeded that which he earned athis mechanic’s job immediately before he quit. [77] In J.W.K. v. E.K., 2014 BCSC 1635, the parties were married for 13 years and had two children. They separated in 2010 whenthey started experimenting with drugs which ultimately led to the father’s addiction. He became unemployed for around three years. In2013 he obtained employment which paid $40,000 annually.

At trial the recipient mother sought child support based on an imputedincome of $88,000, the amount the father earned before he succumbed to addiction. The trial judge found that it would not be reasonableto expect the payor to earn his full professional income while struggling with his addiction, and settled on $40,000 as an appropriateamount.

The trial Judge found it may be that the payor’s initial use of drugs was voluntary and intentional, but thereafter his addictionspiralled out of his control and left him unable to work in his chosen profession. [78] On appeal Justice Punnett considered the issue of imputing income to a drug addicted payor parent. The recipient mother citedHutchison v. Gretzinger for the proposition that it would be wrong at law and contrary to public policy for the court to exempt a parentfrom paying child support because of drug addiction.

The Justice ultimately concluded he need not determine whether drug addiction isvoluntary or a disability that can justify underemployment because the payor had nonetheless failed to meet the evidentiary burden onhim to show his underemployment was the product of his addictions. Justice Punnett upheld the $40,000 imputed income amountdetermined by the last Judge. [79] In cases cited above where the Court found an addicted payor was underemployed, the payor had been regularly and gainfullyemployed before incurring a drug addiction.

Those cases are distinguishable in the sense that the payor parent, aware of his or herobligations to support their child, chose to start consuming substances they reasonably foresaw could lead to addiction and correspondingloss of employment.

[80] In this case Mr. M. says he has been a “screw-up” for most of his life and has historically relied heavily on his annuity as hisprimary means of support. He was already a drug addict and alcoholic when he met Ms. R. and had a child with her. He had a grade 9education and limited employment skills. There is no evidence Mr. M. was regularly employed prior to T.’s birth. I do not believe Ms. R.was oblivious to Mr. M.’s problems until after their son was born. After T. was born Mr. M. simply continued his pre-existing addictivebehaviours and inconsistent employment. Ms.

R. was warned by MCFD when T. was born that Mr. M. was prohibited from living withher and the child because his conduct with his last partner gave rise to child protection concerns. [81] While Mr. M. had an obligation to support his child upon becoming a father, he did not have a corresponding obligation todramatically transform into someone else. The law expects Mr. M. to earn an income and support his child at a level which realisticallyreflects his education, work history, skills, age and health conditions. To the extent addiction is a disease, Mr. M. was ill before he metMs. R.

He continued to be ill afterwards. Policy issues which militate against excusing an addicted parent from supporting their child arefar less compelling in this case where the payor was already an active addict before their child was conceived. It is not the case thatMr.

M., aware of his obligations to support his child, voluntarily consumed drugs he reasonably foresaw would lead to addiction.Rather, he was already at the stage of illness “characterized by a loss of control over the need to consume the substance to which theaddiction relates”, as contemplated by the Supreme Court in the Insite decision. [82] Upon reviewing the authorities and the principles espoused therein, including the competing interests of recognizing addictionas an illness and the need for children to be financially supported, I find that a payor who is already actively addicted to drugs or alcoholat the time their child is conceived should be characterized as suffering from a health condition or disability for the purposes of imputingincome under the Guidelines.

They are in a different position than a payor who voluntarily commences or relapses into substance abuseknowing they have or will have a child to support. The extent to which income should be imputed to a payor who is already an activeaddict at the time of conception depends on the evidence linking that addiction to the payor’s ability to work and their potential forrehabilitation. [83] In E.K. v.

J.W.K., Justice Punnett noted the fact of the payor’s drug problem was uncontested, however, the payor had adducedno expert evidence addressing the effects of his addiction and whether or not his regular relapses were involuntary. Given the dearth ofevidence, Justice Punnett found no error in the trial judge’s determination that the payor’s lack of employment was voluntary. JusticePunnett considered Hutchison v. Gretzinger, Lindsay v. Jeffrey, and Kalanuk v.

Michelson, and went on to state at par. 66: [66] I need not determine whether drug addiction is voluntary or whether it is a health issue or disability that can justifyunderemployment or unemployment for the purposes of s. 19(1)(

a) of the Guidelines. A decision on the issue is unnecessary in thisinstance because the evidence before the trial judge was insufficient to meet the burden on the appellant to establish that hisunderemployment was required by his health. The evidence at trial of the appellant’s addiction consisted of the evidence of the parties.There was no expert evidence addressing the issue.

As in Lindsay, there was no corroborative evidence as to how the drug use adverselyaffected the father’s ability to work, or what period of time it prevented him from working to his full capacity. [84] An expert opinion is not always required to support a payor’s claim that their addictions negatively affect their ability to earn anincome. In S.J.E. v. L.M.E., 2016 BCSC 2579, the mother professed to be a drug addict. Madam Justice Balance considered J.W.K. v.

E.Kand the divergent authorities on substance addiction as a reasonable health need of a parent justifying underemployment orunemployment, as well as the evidence needed to substantiate this assertion. She states at para. 34: [34] Relying on J.W.K. v. E.K., 2014 BCSC 1635 , the respondent argues that the claimant must put before the Court cogentexpert evidence that addresses how her drug use adversely affects her ability to work and the period of time it will prevent her fromworking to her full capacity.

I do not interpret J.W.K. as laying down an absolute rule mandating expert opinion evidence on therelationship between a parent’s drug addiction and ability to work in every case.

Pertinent authorities that do not appear to have beendrawn to the attention of the court in J.W.K. have acknowledged that, although it is always preferable that the court have before itdetailed and cogent opinion evidence from a qualified expert to support a spouse’s claim that she is disabled from working full-time or atall for health reasons, the absence of such independent medical evidence is not necessarily fatal: see generally, Leskun v. Leskun, 2006SCC 25 at p. 28; McLauchlan v. McIntyre, 2016 BCSC 446.

In my view, there is no principled basis to apply a more stringentrule where the health issue in question is the parent’s illicit substance abuse, particularly where the rationale for doing so appears to befastened to the ill-conceived (and slippery-slope) concept that, unlike other medical conditions, addiction is a “voluntary” illness or a“chosen” lifestyle. [85] Upon imputing a minimal income to the payor, Justice Balance stated at para. 47: [47] Even leaving to the side any consideration of the claimant’s actual substance abuse, the evidence establishes that her physicaldifficulties stemming from her arthritic condition together with her post-traumatic stress disorder, of themselves, have combined to pose asignificant barrier to her employment throughout 2015 and presently.

The evidence is insufficient to sustain a finding, however, thatthose impediments are permanent or that they will continue to adversely affect her and her employability for much longer. [86] Although no expert was adduced at trial, Madam Justice Balance did have the benefit of letters from the payor’s medicaladvisors which stated she was unable to work at that time due to her mental health issues. While the fact of his drug and alcoholaddictions was not contested, no medical evidence of any kind has been adduced by Mr.

M. concerning how his addictions and/or braininjury affect his ability to work. [87] There is tension between the evidentiary burden on Mr. M. to demonstrate how his addictions and/or injuries affect his ability toearn an income, and the evidentiary burden on Ms. R. to demonstrate he has been underemployed as contemplated in Yeung v. Silva. InLindsay v. Jeffrey, the Court dealt with these competing burdens by characterizing them as progressive. The initial onus is on the partyseeking to impute income to show the payor is intentionally unemployed or underemployed.

Once established, the onus shifts to thepayor to show their employment decisions were reasonable (at par. 35). [88] In this case both parties have been less than ideal in discharging their respective evidentiary burdens. Mr. M. attested to memoryproblems arising from his childhood brain injury but provided no corroborative medical evidence. He provided little to no evidence of

how his substance abuse operated to interfere with his ability to work, other than to the extent I can infer that it would have been difficult to maintain regular employment during his 9-10 month period of homelessness in 2015 - 2016. For her part, Ms. R. adduced scant evidence that Mr. M. had ever consistently worked full time in regular employment before or after T. was born, or was even capable of doing so. She admits she did not really know much about Mr. M.’s employment other than what he told her from time to time. [ 89 ] It is difficult on the evidentiary record to identify to what degree Mr.

M.’s poor employment record was due to his addictions or, as expressed in R.P. v. M.H.E. , a function of his character. Mr. M. has continued to fail to maintain regular employment even after he allegedly quit abusing drugs and alcohol. Since the summer of 2018, Mr. M. has held several jobs. He started as a cook in a restaurant in [omitted for publication] in July 2018 and within two months sliced his hand on a meat slicer, causing him to be off work (on WCB benefits). Mr. M. says he was “let go” from that job.

In January 2019 he worked at a restaurant in [omitted for publication] but quit after a couple of months because he wanted to “move on” from a small town and did not like being in an environment of heavy drinking given his addictions issues. He then got a job at a restaurant in [omitted for publication] but was fired after a couple of weeks because he had trouble remembering the recipes, a weakness he attributed to the lingering effects of his head injury. In May 2019 he worked as a handyman at a resort but quit after three weeks, ostensibly because they were not paying him. [ 90 ] To the extent Mr.

M.’s poor employment record was a reflection of his personal attributes independent of his addictions, assessing blameworthiness is further complicated by Mr. M.’s alleged cognitive impairments arising from his childhood traumatic brain injury. It is difficult to distinguish whether he loses or fails to pursue jobs because of his injury or a poor attitude. While Mr. M. claims he has significant memory problems which impede his ability to perform many employment related tasks properly, he has adduced no expert evidence to that effect and those memory impairments were not observed by Ms.

R. during their relationship. Ms. R. suggests Mr. M.’s work troubles are largely a function of his attitude, namely, he has little motivation to work because he can always resort to his annuity to support himself. [ 91 ] There is some evidence that back in the late 1990s to 2000 Mr. M. was able to earn a decent level of income working as a roofer. I accept Mr. M.’s evidence that since then he has only worked intermittently as a roofer with his last endeavour being a five day job in 2017. He currently does not possess the requisite certification to work as a roofer. I find that Mr.

M.’s physical condition, namely his leg swelling and pain, precludes him from being regularly employed as a roofer. I decline to impute income to him on the basis that he should be working full time in that profession. I accept that he is capable, to some degree, of working modest paying jobs as a labourer, painter, or line cook. [ 92 ] As set out in the aforementioned authorities, typically speaking a payor parent who relies on their substance abuse as a “disability” justifying reduced employment would have to adduce “cogent evidence” demonstrating how their addictions impede their ability to work. Mr.

M. has not adduced any evidence in that regard except his own uncorroborated testimony. However, in cases such as Lindsay v. Jefferson, Kalanauk v. Michelson , and J.W.K. v. E.K. , there was evidence the payor had worked regularly earning a consistent income prior to succumbing to addiction. Conceptualizing the competing burdens within the framework adopted in Lindsay v. Jeffrey , there was evidence in those cases upon which the Court could be satisfied that the payor was capable of earning a regular income, which then shifted the burden to the payor to justify why he or she was no longer earning that income.

Having found the payors in those cases had not met the evidentiary burden on them to show they were not capable of working, the Court imputed income to them by reference to their pre-addiction earnings. In this case, there was insufficient evidence that Mr. M. was capable of earning a regular and consistent income prior to the child’s birth. As such, I cannot simply resolve Mr. M.’s failure to discharge his evidentiary burden by resorting to his pre-addiction or pre-separation income. [ 93 ] The evidence discloses that Mr.

M. was capable of performing some work during his period of addiction, and he had a number of jobs available to him which he quit for various reasons. I agree with Ms. R. that Mr. M. likely felt less motivated to maintain jobs that posed any degree of difficulty for him because he knew he had his annuity to fall back on for support. [ 94 ] Considering all of the evidence, I make the following findings: • Mr. M. suffered from a drug and alcohol addiction which arose long before he met Ms. R. and continued after T. was born until the summer of 2018; • Mr.

M.’s drug and alcohol addiction was a disability which interfered with his ability to work and maintain regular employment; • Mr. M.’s leg pain and swelling also interfered with his ability to perform some types of physical labour; • due to drug use, the effects of his childhood brain injury, low education, or a combination of some or all of these factors, Mr. M. has a limited ability to obtain or maintain employment which involves mentally challenging tasks; • for the period of Mr. M.’s active addiction, being May 2015 to the summer of 2018, having regard to Mr.

M.’s education, age, health, skills and abilities, he was primarily suited to casual employment paying slightly above minimum wage. For the purposes of imputing income, I have assessed that wage as being 10% above minimum; • Mr. M. was capable of working at least 50% of the time during his period of active addiction. Assuming a forty hour work week (2,080 hours annually), this is equivalent to 1,040 hours per year. Based on his actual earnings, Mr. M. was underemployed in the period May 2015 to December 31, 2017; • Mr.

M. has not discharged the evidentiary onus on him to establish a reasonable excuse for failing to work at least 50% of the time for 10% above minimum wage for the period May 2015 to December 31, 2017. While I accept he was actively addicted, he failed to adduce any evidence of how his addiction prevented him from working at least half of the time. There was evidence from Ms. R. that Mr. M. often failed to show up for work, but Mr. M. did not explain the extent of his addiction, how often he was intoxicated, and how that expressly affected his ability to work. To the extent his addictions prevented Mr.

M. from retaining full time employment because it was difficult for him to regularly show up for work or arrange transportation, Mr. M. adduced no evidence as to why he could not engage in casual, short term or day labour employment at least half of the time. In 2016 and 2017 he did use employment agencies

specializing in short term labour placements, so this kind of work was available to him; • Mr. M. was not underemployed in 2018. He was still actively addicted for the first half of 2018 and only capable ofworking half time. Once achieving sobriety, he did work full time as a cook until he was injured, which was compensated for by WCB. Iaccept that he was let go from that job and found another job shortly thereafter. No additional income should be imputed to him for theyear 2018; and • now that he is sober, Mr.

M. should be capable of working the equivalent of full time regular employment for at least 10%above minimum wage. There is not enough evidence at the stage of this hearing to determine if Mr. M. is underemployed as of January1, 2019. He has held 3 jobs since January. I find he did not voluntarily leave the restaurant job from which he was fired, and he had causeto cease working as a handyman at the resort when they failed to pay him. He was unemployed at the time of hearing so his currentincome cannot be assessed.

As such, his 2019 employment income for the purposes of assessing child support without factoring in hisannuity, should be based on his line 150 income from his 2018 Tax Return. That amount may be retroactively varied once his 2019 taxinformation is available or if his employment situation changes. [95] Applying these findings, I conclude Mr.

M.’s employment income for the period 2015-to present (before imputing any incomefrom his annuity) should be imputed as follows: • 2015: Minimum Wage = $10.45, + 10% ($1.45) = $11.90 * 1,040 hours = $12,376 • 2016: Minimum Wage = $10.45, + 10% ($1.45) = $11.90 * 1,040 hours = $12,376 • 2017: Minimum Wage = $10.85 + 10% ($1.85) = $12.70* 1040 hours = $13,208 • 2018: Line 150 income = $18,152 [96] I find Mr. M.’s income of January 1, 2019, for the purpose of setting 2019 child support, before imputing any income from hisannuity, should be his Line 150 income from his 2018 income tax return, being $18,152. 3.

How Much of Mr. M.’s Annuity, if any, should be imputed to his Guideline income? [97] A structured settlement is a manner of settling a claim for damages in a personal injury lawsuit on a periodic basis over a fixedperiod or for life. The casualty insurer purchases the structured settlement on behalf of the injured recipient and makes an irrevocabledirection to the recipient. The recipient receives a guaranteed tax-free income (annuity) that is non-commutable, non-assignable, andnon-transferable. No one can change or stop the annuity under any circumstances.

Neither the recipient nor the insurer pay tax on theincome produced by the structured settlement. In Hunks v. Hunks, 2017 ONCA 247, the Ontario Court of Appeal held that a structuredsettlement annuity was analogous to disability benefits. [98] The structured settlement provides for payment of compensatory damages owing to the recipient at the time of settlement.Those compensatory damages generally include, without limitation, non-pecuniary damages for pain and suffering, damages forfinancial loss such as diminished past and future earnings, and the cost of future care. [99] Mr.

M. concedes that the portion of the structured settlement which was intended to compensate Mr. M. for loss of earningcapacity can be imputed to his Guidelines income, as it was intended to act in the place of wages. The difficulty arises from the fact thatthe settlement award was made when Mr. M. was 8 years old and, obviously, not employed. How his injuries might affect his futureemployability was unknown. Mr.

M. has filed a copy of the judgment on liability and structured settlement agreement relating to theaccident, however, there is simply no information on how the settlement award was negotiated and how much of it, if any, was intendedto compensate for loss of earning capacity. The settlement agreement makes no reference to different heads of damages. [100] In Brown v. Golaiy, (BCSC), Mr. Justice Finch characterised the injured plaintiff’s loss of capacity to earnfuture income as equivalent to the loss of a capital asset.

In considering the amount by which that loss should be assessed, he says atpage 4: The means by which the value of the lost, or impaired, asset is to be assessed varies of course from case to case. Some of theconsiderations to take into account in making that assessment include whether: 1. The plaintiff has been rendered less capable overall from earning income from all types of employment; 2. The plaintiff is less marketable or attractive as an employee to potential employers; 3.

The plaintiff has lost the ability to take advantage of all job opportunities which might otherwise have been open to him, had he notbeen injured; and 4. The plaintiff is less valuable to himself as a person capable of earning income in a competitive labour market. [101] In Dalton v. Craig, (ONSC), the father was seriously injured in a motor vehicle accident in 1986. He made apersonal injury claim but the settlement was not made and received until 12 years later (1998). In the interim his income comprised of aCPP disability benefit and statutory $140 weekly payments from his insurer which were eventually cut off.

The parties separated in 1992.In 1998 when the father’s settlement was awarded, the recipient mother made an application for ongoing and retroactive child supportback to the date of separation, arguing his settlement funds should be retrospectively considered income for that 6 year time period. [102] The settlement amounts comprised of $305,000 from the defendant motorist and $122,000 from the father’s own insurer (forfailure to pay statutory benefits). The $305,000 was equivalent to the limits of the defendant insured’s policy which was far below thefather’s actual assessment of damages.

As such, the settlement did not specify individual amounts attributable to particular heads of

damage, such as non-pecuniary damages, costs of future care, or loss of earning capacity. The father lived on CPP disability payments and interest from the lump sum settlement as well as regular draws of $33,000 from the capital. [ 103 ] The recipient mother sought a retroactive award and increase of ongoing support to reflect additional income generated by the father’s capital draws on the settlement funds. The trial judge rejected the mother’s submission the father’s income should include the regular capital draws.

He also declined to order retroactive support calculated on the basis of the 1998 settlement award income. The trial judge found the father’s income prior to receiving his settlement consisted of his CPP disability payments, and after the settlement, his income was limited to his disability benefits and interest income from his capital funds.

With respect to ongoing child support, the trial judge calculated the father’s Guidelines income as equivalent to the amount of interest earned on his settlement, which at 5% per annum was calculated to be $24,208 per year. [ 104 ] The trial decision was reversed in part by the Court of Appeal ( 2002 CarswellOnt 42 (ONCA) ) , which found there was evidence that part of the $305,000 settlement award was intended to compensate the father for past and future income loss.

As the settlement agreement did not differentiate between heads of damages, the proportion of the total settlement attributable to past or future income loss could not be determined on the evidence. The parties agreed the $122,000 amount from the father’s own insurer was for lost income.

The court resolved the issue without determining income but selecting an amount payable for retroactive support that seemed “fair”, being $10,000, considering the circumstances of the parties and the fact that a substantial although unspecified amount of the settlement funds had been intended to compensate the father for loss of past and future income. [ 105 ] In M.K. v. R.A.S. , 2004 BCSC 1798 , prior to the parties’ relationship the payor father had suffered a catastrophic brain injury a motor vehicle accident.

He received a structured settlement annuity of $59,625 per year for non-pecuniary damages, loss of income earning capacity and costs of care. His claim for loss of earning capacity was based on his earnings at the time of the accident which were around $30,000. He also received $10,121 per annum in CPP disability payments. [ 106 ] Five years later after the accident the parties commenced a brief relationship and produced one child for which the recipient mother sought child support.

The trial judge imputed to the payor a Guideline income of $95,465 by treating his entire structured settlement annuity as income, then “grossing up” that amount because it was non-taxable. The trial judge also ordered that the level of child support payments be reviewed annually on the basis M.K.’s indexed annuity payment was subject to a 3% annual increase. [ 107 ] The father appealed the issue of whether, or to what extent, a damage award he received for the personal injury claim ought to be treated as “income” under the Guidelines . At the outset, t

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