R.L. v. A.L., 2017 BCPC 457

Citation: R.L. v. A.L. 2017 BCPC 457 Date: 20170714 File No: F-38287 Registry: Surrey IN THE PROVINCIAL COURT OF BRITISH COLUMBIA IN THE MATTER OF THE FAMILY LAW ACT , S.B.C. 2011 c. 25 BETWEEN: R.L. APPLICANT AND: A.L. RESPONDENT ORAL REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE D. GAFFAR Counsel for the Applicant: G. Badh Counsel for the Respondent: P. Burke Place of Hearing: Surrey , B.C.

Dates of Hearing: April 12; May 29; June 23 and July 14, 2017 Date of Judgment: July 14, 2017 INTRODUCTION [ 1 ] THE COURT: By Notice of Motion, R.L. seeks an order to reduce his child support retroactively and prospectively. In early 2017, Mr. L.'s income was reduced by his employer due to workplace issues. [ 2 ] A.L. opposes the motion and has filed a cross motion for an order that increases the monthly child support prospectively and retrospectively. [ 3 ] Mr. and Ms. L. have four children whose ages range from approximately [omitted for publication] years to [omitted for publication] years.

For five months in 2016, one child resided with Mr. L. Since that time, all children have resided with Ms. L. [ 4 ] At this point, the parties are governed by the final consent order of the Honourable Judge Arthur-Leung on the 12th of October 2016, which required Mr. L. to pay child support of $1,838 total per month for four children. His income was imputed at $95,000 per year, but the Family Child Support Guideline amount was reduced somewhat. [ 5 ] During the period of time while one child resided with Mr. L., the court ordered that Mr.

L. pay $1,774 total per month for three children retroactive to July 1st, 2016. He was ordered to pay $887 twice per month. [ 6 ] The parties agree that any order I make regarding child support will be an interim order. The parties agree to adjourn the other matters sought in Ms. L.'s cross motion (i.e. special expenses and Mr. L.'s parenting time with related conduct terms). [ 7 ] I note that Mr. L.'s motion is silent about child support arrears or any interest owing on those arrears, however, the parties have addressed the issue of arrears in some of their evidence and submissions.

The Family Maintenance Enforcement Program is involved in the child support payments. OVERVIEW OF FACTS [ 8 ] I turn now to my overview of the facts. [ 9 ] At this hearing, I permitted the parties to proceed by way of affidavit and related documentary evidence, with Mr. L., Mr. L.'s common-law spouse and Ms. L. cross-examined by the opposing side. I have considered all of the witness and documentary evidence in this matter. I have also considered the relevant provisions of the Family Law Act and the Family Child Support Guidelines, the previous court orders and the cases provided by counsel.

CIRCUMSTANCES OF THE CHILDREN [ 10 ] I turn now to the circumstances of the children. [ 11 ] Mr. L. and Ms. L. married on the 30th of November 2002.

They have four children: T.J.L. (date of birth, [omitted for publication]) who is now [omitted for publication] years old; R.N.L. was born on [omitted for publication], and is now approximately [omitted for publication] years old; J.C.L. was born on [omitted for publication], and is now approximately [omitted for publication] years old; and T.Z.L., born the [omitted for publication], is almost [omitted for publication] years old now. [ 12 ] It appears that the children have resided with Ms. L. continuously, except for R. during the five month period in 2016, from the 23rd of June to the 24th of November of 2016.

CURRENT COURT ORDER [ 13 ] The final consent order of the Honourable Judge Arthur-Leung, which I will now refer to as the October 2016 Order, made the following child support payable:

a) She imputed Mr. L.'s annual income at $95,000.

b) She imputed Ms. L.'s annual gross income at $13,200.

c) She ordered that the child support to be paid for the four children to be $1,838 total per month. From the 1st of April 2016 to the 30th of June 2016, that amount was ordered to be paid. I note that, from the 1st of December 2016 to the present after R. returned to his mother's home, that amount should have continued.

d) While R. was at his father's home, the child support that needed to be paid was for three children in the amount of $1,774 total per month. That amount started the 1st of July 2016 and should have concluded by the end of November 2016. [ 14 ] The couple appear to have separated in October -- or in 2015 in any event. I note that Mr. L.'s Income Tax Return in 2015 listed for the first time that he was separated, whereas, his previous Tax Returns listed him as married.

PREVIOUS COURT ORDERS [ 15 ] There are previous court orders in this matter. [ 16 ] On the 24th of September 2015, the parties obtained a consent order from the Honourable Judge Hamilton. Mr. L.'s income was imputed at $115,000 gross annually and he was ordered to pay $2,580 per month. This occurred between September 2015 to the 30th of

March 2016. [ 17 ] I have already referred to the October 2016 order and the terms of that order:

a) As I have indicated, from the 1st of April 2016 until the end of June 2016, the amount of $1,838 was required to be paid in child support per month.

b) From the 2nd of July 2016 to the 30th of November 2016 $1,774 per month was required to be paid.

c) From December 1st, 2016 to present $1,838 per month was payable. PAYMENT Family Maintenance Enforcement Program [ 18 ] In reality, what was supposed to be happening between December 1st, 2016 onwards, as I said, was $1,838. According to the Family Maintenance Enforcement Program records, Mr. L. (on the 4th of August 2016) was not in arrears at the time of enrolment. There was a credit or overpayment of $699.50. [ 19 ] At the 31st of December 2016, at first review, it appears that nothing was owing, that there were no arrears, and that there was overpayment from January 1st to February 3rd, 2017.

However, the Family Maintenance Enforcement Program failed to adjust the amounts owed from December 1st, 2016 onwards after R. returned to Ms. L.'s residence in November 2016. [ 20 ] The October 2016 court order clearly states that the child support amount will revert to $1,838 per month if R. returned to his mother's home.

From December 1st, 2016 until present day, the Family Maintenance Enforcement Program has incorrectly maintained a payable amount of $1,774 per month, so I have recalculated the actual amounts that were paid and the actual amounts that are in arrears prior to making any decision. [ 21 ] On the 29th of November 2016, according to the Family Maintenance Enforcement Program, there was no arrears. Mr. L. was in a credit of $1,774. Mr. L. did not make any child support payments in December, having the credit of $1,774 with the Family Maintenance Enforcement Program.

It appears that he assumed that his payment would be that amount. Therefore, at that point, he was in arrears for $64. Sorry, I think my math might be wrong there. No, it is $64. Actual Payments [ 22 ] What happened in reality:

a) In January 2017, Mr. L. paid $1,898. He was in arrears for four dollars at that point.

b) In February 2017, he paid $1,655. At that point the total arrears was $187.

c) In March 2017, he paid $1,000 and at that point he was in arrears $1,025. I am going to ask counsel to verify my math as well. Yes, sorry, that is right. In March, he paid $1,000. He was in arrears $1,025.

d) In April 2017, he paid $1,000. He was in arrears $1,863.

e) In May 2017 he paid $1,000 and he was in total arrears at that point for $2,701. [ 23 ] I have confirmed various payment dates. From March the 1st, 2017 until May the 27th, 2017, I viewed the banking documents provided by Mr. L. and the Family Maintenance Enforcement Program. I have compared the payment dates on Mr. L.'s banking documents and the dates for the corresponding payments on the Family Maintenance Enforcement records. Although it was difficult to see some of the payment dates on the banking records, I conclude that there have been delays between the dates when payments were deducted from Mr.

L.'s bank account and the dates when payments were processed by the Family Maintenance Enforcement Program. Those delays ranged from one to 10 days. [ 24 ] I also note that the two Family Maintenance Enforcement Program documents provided to me contain conflicting information about payments made in March 2017. The Family Maintenance Enforcement Program account statement up to the 19th of May 2017 depicts two payments in March of 2017. The 23rd of June 27 (sic) [2017] printout of the Family Maintenance Enforcement Program transactions covering the same time period only lists one payment in March of 2017.

I accept the May 2017 statement over the June 2017 printout with regards to the March 2017 payments. [ 25 ] Between March and May, Mr. L. paid on March 3rd, March 21st, April 7, April 24, May 15 and May 30th (all payments of $500 each). [ 26 ] On the 29th of May 2017, I made an interim order for child support to be paid in the amount of $575. [ 27 ] According to the Family Maintenance Enforcement Program list or printout that was made in June, there was a payment made on June the 9th in that amount and on the day we last attended court on June 23rd, another payment was coming out.

By June the 23rd the arrears owing was $3,389. I am going to assume that on July the 7th, 2017 a further $575 was paid, thereby raising the arrears to $3,733. These amounts do not include the Family Maintenance Enforcement Program fees and interest. Anticipated Income [ 28 ] Mr. L. anticipates that his gross income for 2017 will be $47,800, after expenses. He has calculated that amount with the Family Child Support Guideline. If I was to grant that amount, it would be $1,143 per month. However, I have done a separate calculation that

includes various other items that I will discuss later. [ 29 ] I note that Mr. L.'s previous gross income from 2013 to 2016 (before expenses were deduced) were as follows: From 2016 – his income was $95,235; 2015 – $109,701; in 2014 – $118,012; in 2013 – $112,636. The average income between 2014 and 2016 was $107,549. POSITIONS OF PARTIES [ 30 ] Mr. L. specifically seeks the following:

a) With regards to child support, he argues that I should find his gross annual income will be approximately $47,800.

b) He asks that I reduce his child support prospectively to $1,143.56 total per month, paid in equal instalments of $571.78 twice per month.

c) He also asks that I reduce his child support retrospectively to cover from the 1st of March 2017 until today, presumably such that it would reduce the arrears payable on his child support.

d) He also asks that I cancel the remaining arrears payable on the total amount for child support owing. [ 31 ] Mr. Badh, may I just confirm that is his position? There seemed to be some fluctuation about that, whether it was just the total amount that he wanted to have cancelled or any amounts of arrears since March 1st? [ 32 ] MR. BADH: Yes, Your Honour. The calculation is that he wants arrears from March up 'til now to be gone completely and then he'll pay the arrears from December to February depending upon -- that he was supposed to pay for four children. [ 33 ] THE COURT: Ms. L. seeks that I do the following:

a) That I increase Mr. L.'s child support prospectively for four children to the September 2015 level, paid in equal instalments of $2,580 per month – sorry, this is the old one. I do apologize. To return Mr. L.'s child support to the October 2016 amount of $1,838 per month.

b) To increase the child support amount retrospectively back to the 1st of December 2017.

c) She opposes any elimination of arrears, I presume, Mr. Burke. [ 34 ] MR. BURKE: That's correct, Your Honour. ANALYSIS [ 35 ] I now turn to my analysis. [ 36 ] THE COURT: Mr. L. must demonstrate on a balance of probabilities that a material change of a substantial nature has occurred before I am permitted to vary the October 2016 Order. The principal evidence by Mr. L. regarding a material change relates to his work situation. His employer has reduced Mr. L.'s work obligations, due to what he says was a demonstrated inability to fulfil his duties. In other words, he was demoted. [ 37 ] Mr.

L. has provided evidence in documentary form and testimony that he has been employed since 2007, with the same employer for a decade. He provided a letter from his employer, dated January 30th, 2017, which details Mr. L.'s prior duties as a project manager and indicated that such duties required substantial flexibility, and time, and work hours. The letter then explains that, over the past year, Mr. L. was unable to fulfil his duties. His employer adopts Mr. L.'s explanation for why he had not been able to meet the requirements of his role as a project manager. The letter also explains that Mr.

L. expressed a need for a more defined and structured work

schedule because his family obligations and family court obligations impacted his duties. [ 38 ] In his testimony, Mr. L. also explained that there were other work issues that impacted his status with the company. The business was also experiencing issues due to his boss' personal issues, the economy and the climate, all of which directly impacted the ebb and flow of business. The change in gross income is significant, almost 50 percent. His current and anticipated income is not commensurate with either the September 2015, nor the October 2016 child support orders.

The reduction in income started approximately one month after the date of the employer's letter. His paycheques depict decreased income beginning March the 1st. [ 39 ] Ms. L. wants to return to the October 2016 child support level. Ms. L.'s evidence was as follows with regards to the material changes. The October 2016 imputed income of $95,000 per year was significantly less than the Tax Return line. She says that she acknowledges that a final order was made by consent, but notes that Mr. L. has not provided his 2016 Tax Return. Ms.

L. had copies of his paystubs for the past several years, including some from 2017. In her view, Mr. L.'s income was generously reduced in 2016. In her view, the reduction in salary for the 2017 period is too drastic and is causing significant hardship for her children and, obviously, Ms. L. Ms. L. can no longer meet her financial obligations and is falling behind on bills. It is her view that Mr. L. is underemployed now. [ 40 ] I will make the following observations. Ms. L.'s evidence regarding her circumstances, both in affidavit and testimony, referenced extended medical care issues.

Her affidavit also referenced special and extraordinary expenses, which will not be dealt with at this hearing. She stipulates that she has been falling behind on bills, but I do note that Ms. L. did display an approach to her bills that was troubling. She did not appear to know the exact amounts owed because she testified that she did not open the envelopes, because she did not feel she could pay them in any event. Unfortunately, this is not the kind of approach that benefits her children or improves her ability to manage her finances. [ 41 ] Mr.

Burke argues that the contents of the letter from January 30th, 2017, implies that Mr. L. asked for a demotion and

essentially blames Ms. L. He argues that Mr. L. and his employer are sufficiently close that they have concocted this purported demotion. He argues that the letter does not refer to a demotion, nor really describe previous job obligations or future plans to deal with Mr. L.'s situation. He argues that it is implausible that they would not have a plan or try to support such a valued employee. [ 42 ] However, in my view, a reading of the whole of the letter clearly shows that the employer has described Mr.

L.'s previous and future job obligations, which show a reduction of responsibility, as well as the expected reduction in wages. The primary evidence in this hearing is really the January 2017 letter from his employer, in which the employer explains Mr. L.'s value to the company, why his position and hourly wage is being downgraded, and how that will affect his ability to earn more money through overtime hours. [ 43 ] I accept that Mr. L. is a valued employee, but I am not prepared to say that his employer is not independent nor arm's length.

His paystubs over the past few years demonstrate his increasing wages, hours and responsibilities until January 2017. As a project manager during the period of July 2016 until the end of February 2017 he was paid $35 per hour and worked an average of 37.9 hours per week with very little overtime. I note that, while his hourly wage, overtime and hours in the year 2017 were much higher, that appeared to be a peak period. I note that the parties still consented to the $95,000 income attribution in 2016. [ 44 ] The January 30th letter, Mr. L.'s affidavit and his testimony all express Mr.

L.'s concern that the time needed for his family- related and court obligations required a more defined and structured work schedule. His employer accepted this explanation for why duties were not fulfilled, but was still trying to accommodate him in some fashion. His employer appears to be extending a means for Mr. L. to maintain his employment, albeit with reduced duties and pay, and is sufficiently arm's length. No matter how close the relationship, this business was not prepared to return him to his project manager wages when his role was reduced to a foreman.

I do not consider his use of the company vehicle, which I would expect to be used for his employment, to be a factor in any kind of concocted scheme between his employer and Mr. L. It seemed to make good business sense and seems to be, in some fashion, a less expensive way to support Mr. L. in his reduced financial circumstances, even with insurance and attendant fees, than paying him a much higher wage. [ 45 ] Mr. Burke argues that the demotion does not make sense. In my view, the reasons are clear and uncontradicted. I am unable to find a reasonable explanation how such a demotion would be sought by Mr.

L. or how it would actually benefit him. I can find none. His consistent efforts to pay child support demonstrate that he cares for his children. Ms. L.'s assertion that he had not paid her over various periods of time are flatly contradicted by the Family Maintenance Enforcement statements. [ 46 ] I cannot find any evidence that Mr. L. is overtly accepting reduced wages but accepting undisclosed or undeclared income. There is no evidence that Mr. L. has other income.

Beginning in March of 2017, he was paid $23 per hour and worked an average of 40 hours per week with two hours of paid overtime in the month of March 2017. I accept his evidence that the overtime during this period related to one hour status meetings. I also accept that the objective of the position downgrade was to permit him to have more regular hours so that he could deal with personal business. [ 47 ] I do not place too much weight on the income related figures referenced in the January 4th, 2017 email from Mr. L. to Ms. L.'s counsel, Mr. Burke. I consider this email to be Mr.

L.'s attempt to provide notice of the changes to come with his estimates, only, of what to expect. The paystubs reflect the reality. [ 48 ] I find that Mr. L. is not deliberately underemployed to frustrate his family and child support obligations. Given current general economic circumstances, it is unrealistic to expect Mr. L. to quit long-time and secure employment. Mr. L. is a trusted employee who is weathering, as I have mentioned earlier, the ebb and flow of his employer's business. He is still being retained, despite previous issues with the quality of his work.

He is not being unjustly enriched by his common-law spouse or her mother. [ 49 ] I do observe, however, that Ms. L. should not expect that Mr. L. will continue with the current wage arrangement at his employer at the expense of his children's child support over a period of time. I would also expect that it would cause even more significant hardship to his children if he did not start making efforts to improve his financial circumstances. [ 50 ] I am prepared to accept Mr. L.'s evidence that he will adjust the child support when the situation improves.

Although the Family Maintenance Enforcement Program became involved in August of 2016, Mr. L. was not in arrears at that time. He has consistently made payments since August of 2016, but the timing of some of the payments has caused significant problems for Ms. L.'s ability to pay for the necessities for the children. Since that time, Mr. L.'s payments have been received three to five days after the due dates as he has paid bi-weekly, not precisely on the 1st or the 15th of every month. According to Ms.

L., payments after the 1st or the 15th of the month have impacted her and has caused her difficulties in paying her bills on or by that date. [ 51 ] There are two possible solutions to this problem. One solution is to have electronic withdrawals automatic from Mr. L.'s account on pay days twice per month. One could say that it is for Ms. L. to deal with the Family Maintenance Enforcement Program regarding how long they take to process the payments and to plan her financial affairs accordingly.

As the one most impacted, this might make sense. [ 52 ] However, there is a second solution, and this is the solution that I prefer. That there be electronic withdrawals from Mr. L.'s account on the 1st and the 15th of every month, with Mr. L. to ensure that he has arranged his financial affairs to ensure the funds are in the account on those dates. Mr. L. would have to ensure the funds were held back in his account to cover his payments. [ 53 ] I note that families do have to live within their means, but Mr. L. has advised Ms.

L. of low cost programs available in applicable community services. [ 54 ] However, the courts have repeatedly noted the children should not suffer a substantial decline in lifestyle due to the breakdown of the family unit. That means that Mr. L. should be paying his fair portion of those expenses. They are not unreasonable extracurricular activities and would greatly benefit the kids. [ 55 ] It must be emphasized that Ms. L. is caring for four children. That is a substantial responsibility given the age of the youngest child.

Exhortations to obtain employment are easier to make than to realize with four children. This is particularly the case for someone who does not have a steady or long-term employment history outside of her home because she started having children and married at a

very young age (by my estimate 18 years). [ 56 ] However, I will also note that I am troubled by Ms. L.'s evidence that she was unable to make the necessary applications for disability assistance due to lack of funds, when it appeared from her evidence that she could obtain those small fees from family members. [ 57 ] The inability to receive funds on dates certain and lack of timely payments have greatly impacted the children and their mother's ability to meet their needs with such basic items as food.

However, recourse to the food bank should also be a last resort and not a central exhortation by the paying spouse. It risks being interpreted as an insult and would not assist Mr. L. in any future disputes. [ 58 ] If I make a retrospective order it will reduce, but not eliminate, the arrears. While it appears that Mr. L. brought this motion as soon as possible, it was not able to conclude until several months later. However, I am not inclined to cancel any arrears or interest given the degree to which the children had been greatly impacted by Mr. L.'s reduced income over those months.

It would not be fair to them. CONCLUSION [ 59 ] I have assessed Mr. L.'s financial statement. There are some expenses that are listed on the statement that can no longer be sustained given the necessity to reduce the impact of his new financial situation on the children. Therefore, I am going to do the following:

a) For January 2017 – I conclude that, from January to the end of February, Mr. L. grossed $10,185 when he was working at the rate of $35 per hour.

b) I am adding that to what I expect to be his income for the following 10 months, which will be approximately $3,818 per month.

c) Now, that is a total of $48,365, but that does not end my assessment.

d) I am going to add to that figure $2,000, which represents the amount contributed by Mr. L. to his RRSP. This amount is not high, but given the significant reduction in wages and its impact on his children it should be added back to the gross.

e) I am also going to add back costs that he has described on his expense statement for liquor and tobacco, as well as gifts. These items are high. They are recreational and they are discretionary. Again, they should be added back given the significant reduction of his wages and the impact on his children. [ 60 ] In conclusion, Mr. L.'s application is granted in part. On an interim basis this will be the calculation. The imputed income will be as follows, and I am just going to do the math for you so you can see how I broke it down.

The figure of anticipated gross income of $48,365, adding $3,000 for alcohol and tobacco, adding $600 for gifts, and adding $2,000 for the RRSP, I am now imputing income at $53,965. I am rounding that up to $54,000. I am actually imputing income at $54,000. Which means, pursuant to the Family Child Support Guidelines, that the monthly child support payments shall be $1,286 per month. Mr.

L. shall make those payments twice per month on the 1st and the 15th of every month beginning July the 14th, 2017 until further order of the court. [ 61 ] The parties shall review child support in eight months to see if there have been any changes in Mr. L.'s income during that period of time. Mr. L. is responsible for ensuring that all necessary funds are in his account on those dates and that those funds will be transmitted immediately to the Family Maintenance Enforcement Program. [ 62 ] Anything further? (DISCUSSION BETWEEN THE COURT AND COUNSEL) [ 63 ] THE COURT: I will add that Mr.

L. shall pay an additional $100 per month divided as $50 twice a month on the 1st and on the 15th of every month in addition to his child support payments in order to reduce his arrears. (REASONS FOR JUDGMENT CONCLUDED)