C.D. v. D.D. Date:, 2012 BCPC 558

Citation: C.D. v. D.D. Date: 20121001 2012 BCPC 0558 File No: F32758 Registry: Surrey IN THE PROVINCIAL COURT OF BRITISH COLUMBIA IN THE MATTER OF THE FAMILY RELATIONS ACT , R.S.B.C. 1996 c. 128 BETWEEN: C. D. APPLICANT AND: D. D. RESPONDENT REASONS FOR JUDGMENT OF THE HONOURABLE JUDGE A.E. ROUNTHWAITE

Appearing in person: C. D. Counsel for the Respondent: Jane M. Reid Place of Hearing: Surrey , B.C. Dates of Hearing: August 30 and September 24, 2012 Date of Judgment: October 1, 2012 [ 1 ] DD (“the father”) and CD (“the mother”) are the parents of two sons: D aged 8, and L aged 5. They share joint custody of the children whose primary residence is with their mother.

There is a court order that they spend three out of four weekends with their father although this hadn’t happened in the month or so preceding the first day of hearing. [ 2 ] The father has applied for court orders reducing his child and spousal support payments. The mother agrees that some reduction is justified, but says the change should not be as much or take effect as early as the father requests.

The issues I must decide are therefore the amount by which payments should be lowered, and the date when any reduction should take effect. [ 3 ] The parents began living together in 2000, were married in 2003, and separated at the end of 2009. Following separation they had an informal agreement that the father would pay the mother $1,800 a month.

After mediation by a Family Justice Counsellor, they both signed a written agreement (“the agreement”) dated November 29, 2010, and filed in Provincial Court December 6, 2010, that included the following terms: - That the father pay child support of $1,045 a month in two installments commencing October 1, 2010, based on an annual guideline income of $69,400. - That he pay spousal support of $842 a month in two installments commencing October 2010 and continuing for 7 years. - That he provide medical and dental insurance coverage for the children for so long as it is available through his employment. - “That if either party experiences a significant change in financial circumstances, they will report this change with documentation to the other party within 30 days for the purpose of adjusting support provisions outlined in this agreement.” (paragraph 9) - “That on or before the 1 st of June of each calendar year, both parties will exchange current income and tax information for the purpose of adjusting support provisions outlined in this agreement.” (paragraph 10) [ 4 ] In these Reasons, I will first discuss the changes in the parents’ circumstances since they entered into the agreement, then determine their incomes and the applicable guideline amounts of child and spousal support, and then decide when changes should take effect.

Significant Change in Circumstances

a) Father’s Income [ 5 ] The father works for an asbestos abatement company. Due to a downturn in the industry, his hourly rate decreased by about $3.00 an hour in January 2011 and on February 3 his employer notified him that his hours of work would be reduced. He quickly found it difficult to make the required support payments. In February and March, he communicated this to the mother several times by email and in conversations. He said he couldn’t afford the payments and asked her to agree to lower them or return to mediation. She refused.

He then filed an application to reduce or terminate spousal support on March 1, 2011. The mother filed a reply disagreeing with the application. (She also requested a court order that the father put her and the children on his medical plans, and this issue has been resolved.) On September 6, 2011, the father filed a financial statement including income tax returns, pay stubs, and memos from his employer documenting reductions in pay rates and hours.

On September 14, 2011, he filed an amended application requesting that both child and spousal support be reduced retroactively and on an ongoing basis, and an interim order was made reducing child support to $759 a month, based on an estimated 2011 guideline income of $50,000, and requiring the mother to file a financial statement, which she did on October 14, 2011. [ 6 ] Although the father says he didn’t understand the seriousness of the agreement and thought it could be changed by mediation whenever circumstances changed, I am satisfied that he signed the agreement voluntarily after being given an opportunity to consult a lawyer and advised it might be in his best interest to do so.

He said he did not receive financial disclosure from the mother before signing the agreement but this is not significant because he believes she did not work outside the home in 2010. Moreover, his 2010 guideline income was $69,407, so the support terms of the agreement were not unreasonable. [ 7 ] The father is a member of the International Union of Painters and Allied Trades. In 2011 his income, based on Line 150 of his tax return minus union dues, fell to $41,855. He testified that his hours of work were cut back and his pay scale rolled back from foreman to lead hand due to shortage of work.

His employer’s testimony and correspondence from his union and employer support his evidence. The mother does not believe the father’s income was so low. She produced Worksafe BC forms submitted by the father’s employer that still show him as project supervisor after he says he lost his foreman’s pay scale. I accept the explanation of the father and his employer that these forms reflect planned project details that often changed once the project began, and that the father continued to act as a supervisor on some projects while being paid as a lead hand.

I also accept the employer’s testimony that no bonuses have been awarded in the last two years. The evidence did not establish that the father had turned down work except on one occasion to assist Ms. CD with childcare in a family emergency. Nor did it establish that he had missed work for a vacation. I therefore accept that the father’s guideline income for 2011 was $41,855.

[ 8 ] His 2012 income is likely to be even lower. A May 3, 2012, letter from the Union to its hazmat members informs them that their scheduled wage increase was suspended because their contractors were having difficulty securing work for union members due to encroachment by non-union contractors. Extrapolating from his year-to-date earnings, I find the father’s actual income for 2012 is likely to be around $23,469. I accept his evidence that he is in serious financial strains and is unable to insure his vehicle, pay his rent or afford his own telephone, cable and internet.

I also accept that he has found it devastating to be in the position of borrowing and relying on others because in the past he has generously supported others. [ 9 ] The father did not complete high school and trade tickets he acquired working in the oil patch are no longer current. He has gained training and skills in the asbestos abatement industry, but he testified that his current opportunities for earning more in his industry are severely limited. He has borrowed money from his employer to pay legal fees and feels compelled to remain with that employer until he pays off the loan.

He also wishes to remain with his current employer because his strong work ethic makes him a valued employee with possibilities for promotion there. His employer has encouraged employees to seek work with other companies during the slowdown, but the father can’t work for non-union companies without losing his union membership. [ 10 ] However, I am not satisfied that the father has done everything possible to increase his income in 2012.

On the first day of hearing, he only mentioned one other union company from whom he sought work and said he did not investigate any other ways to earn money, such as painting or doing odd jobs. He said that other union companies have little work to offer since they are in the same position as his employer.

However, after I suggested that he should be more active in seeking additional employment before the continuation date, the father was able to earn some $882 working for another union employer. [ 11 ] Moreover, the father’s employer gave evidence that a lot of their work is done in the evenings and on weekends when the father was not available for work because he has custody of his children.

In the past the father has had weekend access but generally not evenings, and he has felt unable to exercise his weekend access for a period of time before the hearing because he couldn’t afford to insure his vehicle and didn’t have money to spend on the children.

In the circumstances, he could have told his employer he was available to work on the weekends as well as during evenings, thereby increasing his income. [ 12 ] When asked by his lawyer about his plans to increase his income, the father testified on the first day of hearing that he had a plan to take an estimating course from the union and then work as an estimator for his current employer, a position that would pay more. He said he thought this would involve a one week course that the union would pay for.

However, he hadn’t taken any steps to make that plan happen and hadn’t even obtained detailed information about what would be involved.

On the continuation date, he testified that he had inquired and discovered that the union doesn’t offer such training and that one would have to attend a course at BCIT that would include training on estimating. [ 13 ] Because the father did not do all he could to find additional work and improve his situation during the first eight months of 2012, and because it seems likely that if he continues to make the same effort to find work that he did between August 30 and September 24, he will be able to obtain some additional income, I conclude that the father has the ability to earn more than $23,469 in 2012.

In these circumstances, I will impute additional income to him for 2012 and consider his guideline income to be $30,000, an amount he could reasonably be expected to have earned this year.

b) Mother’s Income [ 14 ] The mother lacks some credits for Grade 12 graduation and worked as a groom, cleaner and in a warehouse before having children. During the marriage, she did not work outside the home after becoming pregnant in 2003. In 2010, the first year after separation, she remained at home caring for the children and her income consisted of the Child Tax Credit and support payments. Since then she has worked part time on call as a labourer for another asbestos abatement company and she plans to work her way up, increasing her hours with that company.

The younger child started kindergarten this month, decreasing the hours for which childcare must be obtained when the mother works outside the home. [ 15 ] In 2011 the mother’s gross annual income was $6,333 from part time and seasonal employment and childcare benefits. Extrapolating from her year to date earnings in 2012, the mother’s 2012 income would be about $17,218. [ 16 ] I decline to impute additional income to the mother, as suggested by the father’s lawyer.

The mother has always been the children’s primary caregiver and the agreement for spousal support appears to have recognized that she had been out of the labour market caring for the children full-time for seven years and would require time to become self-supporting. Moreover, there is no evidence of what other employment opportunities, if any, may have been available to her in 2011 and 2012.

c) Conclusion [ 17 ] The significant decrease in the father’s guideline income and an increase in the mother’s income constitute a significant change of circumstance triggering adjustment under paragraph 9 of the agreement. It would also justify variation under s. 20 of the Family Relations Act. Amount of Child Support [ 18 ] Based on the father’s 2011 Guideline income of $41,855, the table amount of child support for two children is $639 a month. Based on his imputed income of $30,000 for 2012 the table amount is $463 a month.

At the father’s request, I will order that if the parents are unable to agree on the support payable after exchanging financial information in accordance with paragraph 9, they shall attend with a Family Justice Counsellor to assist them with that determination before June 30 th each year. I will also cancel the default fees of $800 because the father applied promptly to reduce support payments and the delays in having his application heard were not attributable to him. Special Expenses

[ 19 ] Paragraph 11 of the agreement requires the parents to discuss and prearrange all extracurricular activities for the children, and share the cost of mutually agreed activities in proportion to their incomes. For 2012 their proportional shares are 63% for the father and 37% for the mother. Amount of Spousal Support [ 20 ] In 2011 the mother’s income was $6,333.

If the father paid the Guideline amount of child support $639 a month based on his 2011 income, the mid range of the Spousal Support Guidelines would require him to pay spousal support of $188 a month. [ 21 ] Applying the Spousal Support Guidelines to the mother’s extrapolated 2012 income of $17,218, and the father’s imputed 2012 income of $30,000, with $463 child support payable, would indicate spousal support payments $0.

The father would not be required to pay spousal support because child support is the first priority and after paying it, the father would not have enough disposable income to pay spousal support. [ 22 ] However, the fact remains that the mother was unable to obtain training and work experience for the seven years she remained at home with the children, permitting the father to advance in the asbestos abatement field to the point where his hourly rate is higher than hers.

I accept that the father is not a “deadbeat dad”: he voluntarily paid Guideline amounts of child and spousal support following separation, and appears to have been driven close to desperation by the unanticipated decline in work in his industry. However, I am hopeful that his strong work ethic will result in his income rising again in the future, and if it reaches the point where he can afford to pay spousal support, he should be required to fulfill the provisions of the agreement that considered seven years a reasonable period for the mother to become self-supporting.

For these reasons, I will not terminate spousal support but reduce it to $188 a month for the portion of 2011 indicated below, and to $1 a month commencing January 1, 2012, and continuing for the remainder of the seven years (until September 30, 2017), subject to annual adjustment of the monthly amount as required by paragraph 9. [ 23 ] At the time the agreement was made, the father was earning far more than the mother and she was at home with the children. She was at an economic disadvantage as a result of the childcare responsibilities she assumed during the marriage.

Given the length of the marriage and the differences in their incomes, it was reasonable for the father to contribute to her support when he could earn the money to do so over a period of seven years, at which time she could be expected to have become self-supporting. To her credit, the mother is on her way to the goal of self-sufficiency. The father has encountered serious financial setbacks, to the point where even with additional income imputed to him he falls below the Guidelines’ threshold for payment of spousal support.

Maintaining a nominal $1 a month amount of spousal support will enable the monthly amount to be adjusted as the father’s income increases in the next five years. When Should Changes Take Effect? [ 24 ] There are several possible dates when variation of the support amounts might take effect. The father cites the law governing retroactive applications to increase child support, established in D.B.S. v. S.R.G. 2006 SCC 37 , a decision of the Supreme Court of Canada, and argues that it is applicable to applications to decrease child support retroactively as well.

In that case the Court said that awards may be made retroactive to the date when the applicant gave the respondent effective notice, meaning an indication that the current amount of support needs to be changed. Here, there was effective notice with regard to the father’s wish to decrease both child and spousal support in February and March 2012. [ 25 ] However, paragraph 9 of the agreement provides a means for the parents to adjust support payments when circumstances change and it includes a provision for notice.

Taking into account the 30 day notice period in paragraph 9, and the fact he filed his initial application on March 1, 2011, the father is willing to accept April 1, 2011 as a reasonable date for variation. [ 26 ] On the other hand, the mother says it would be unfair for the father to change a negotiated agreement within a few of months of signing it, and submits that the agreement should be binding on the parties for the first year. [ 27 ] Finally, paragraph 10 of the agreement provides for annual adjustment after exchange of financial information on or before June 1 st each year, although the parties did not exchange financial information until September and October 2011. [ 28 ] On which of these four dates should changes to support payments take effect?

I accept that the father’s wage rollback in January 2011 was a significant change and that it was not unreasonable for him to seek adjustment under paragraph 9, even though the change occurred so shortly after the agreement was signed. In fact he behaved responsibly in alerting the mother to his financial setback and filing a court application without delay. However, while the father told the mother early in 2011 about changes in his income, I am not satisfied that he provided the documentation required by paragraph 9 until he filed his financial statement in September 2011.

I consider the mother’s definite testimony that the father did not give her a copy of the letter from the father’s employer to be more reliable than the father’s vague belief that he showed her the letter. [ 29 ] I also reject the father’s lawyer’s submission that his emails to the mother saying he couldn’t afford the agreed payments constituted the documentation required by paragraph 9. The emails satisfy the requirement to report the change in his financial circumstances but the agreement requires this report to be “with documentation” and the father gave no supporting documents to the mother until September.

The application filed March 1, 2011, doesn’t amount to documentation because it doesn’t set out his changes in income but focuses on the reasons he felt the agreement for spousal support should not bind him. I therefore conclude that the father did not comply with the requirements of paragraph 9 to supply documentation when he reported his significant change in circumstances.

As a result he cannot rely on paragraph 9 for the commencement of reduced payments on April 1, 2011. [ 30 ] I can understand the mother’s desire to have the agreement unchanged for its first year, but her position is not supported by the terms of the agreement or the case of D.B.S. v. S.R.G.

As hard as it is on the mother who was relying on agreed support and has had to provide for the children no matter what she received from the father, when circumstances changed soon after the agreement was made, neither the terms of the agreement nor the law established by this Supreme Court of Canada case prevented the father obtaining an appropriate change in support payments. [ 31 ] There ought to have been an adjustment of support payments under paragraph 10 on June 1, 2011, and the parents share

responsibility for not exchanging the information necessary to make that happen. Nevertheless, the agreement contemplates adjustment taking place on that date, and I consider it the fairest date for variation to commence given the parents’ circumstances. Orders [ 32 ] I therefore make the following orders: I vary the agreement dated November 29, 2010, and filed December 6, 2010 as follows: DD shall pay to CD the sum of $639 a month for the support of the two children commencing June 1, 2011, and continuing on the first of each month through December 2011, based on a Guideline income of $41,855.

DD shall pay to CD the sum of $463 a month for the support of the two children commencing January 1, 2012, and payable in equal installments of $231.50 on the first and 15 th days of each month thereafter, based on an imputed guideline income of $30,000. If the parents are unable to agree on the support payable after exchanging financial information in accordance with paragraph 9, they shall meet with a Family Justice Counsellor to assist them with that determination before June 30 th each year.

The parents’ proportional shares of mutually agreed extracurricular expenses for 2012 are 63% for the father and 37% for the mother. DD shall pay to CD the sum of $188 a month for spousal support commencing June 1, 2011, and continuing on the first of each month through December 2011. DD shall pay to CD the sum of $1 a month for spousal support commencing January 1, 2012, and continuing on the first of each month thereafter until September 30, 2017.

Default fees of $800 are cancelled. [ 33 ] The amount of any arrears owing by or credit due to the father as a result of these variations can be calculated by the Family Maintenance Enforcement Programme, and if he wishes, by the father’s lawyer. Interest will apply only to any arrears owing after re- calculation of the amount owing based on these variations. [ 34 ] I thank the father’s lawyer, Ms. Reid, for her well-organized presentation of the evidence, and thank Ms. CD for the organized way in which she raised the issues. The Honourable Judge A.E. Rounthwaite Provincial Court of British Columbia