MacLennan v MacLennan, 2021 SKCA 132

Court of Appeal for Saskatchewan Docket: CACV3706 Citation: MacLennan v MacLennan , 2021 SKCA 132 Date: 2021-10-07 Between: Myles Michael MacLennan Appellant (Respondent) And Loren Lee MacLennan Respondent (Petitioner) Before: Leurer, Barrington-Foote and Kalmakoff JJ.A. Disposition: Appeal allowed Written reasons by: The Honourable Mr. Justice Kalmakoff In concurrence: The Honourable Mr. Justice Leurer The Honourable Mr. Justice Barrington-Foote On appeal from: DIV 454 of 2019, Saskatoon Appeal heard: June 10, 2021 Counsel: James A. Morrison, Q.C., for the Appellant Dennis J.

Fisher, Q.C., for the Respondent Kalmakoff J.A. I. INTRODUCTION [ 1 ] Myles MacLennan [Myles] and Loren MacLennan [Loren] separated after nearly 23 years of marriage. Loren applied for interim child support and interim spousal support.

A Court of Queen’s Bench judge, sitting in Chambers, ordered Myles to pay interim child support of $22,000 per month, effective September 1, 2020, and interim spousal support of $19,000 per month, retroactive to March 1, 2020 ( MacLennan v MacLennan , (25 August 2020) Saskatoon, DIV 454/2019 (Sask QB) [ Chambers Decision ]; MacLennan v MacLennan , (10 September 2020) Saskatoon, DIV 454/2019 (Sask QB) [ Corrigendum ]).

The Chambers judge also adjusted the retroactive portion of Myles’s spousal support obligation to account for the payments he had already made. [ 2 ] Myles appeals against the Chambers Decision and the Corrigendum . For the reasons that follow, I would allow the appeal and determine that Myles is required, on an interim basis, to pay $12,000 per month in child support and $14,000 per month in spousal support, effective September 1, 2020. I would set aside the retroactive spousal support order made by the Chambers judge. II. BACKGROUND [ 3 ] Myles and Loren were married on September 20, 1996.

They differ in their views on when they effectively separated, but they agree that their marriage was over, for good, by June 1, 2019. [ 4 ] Myles is, by profession, an oral surgeon. His surgical practice generates a substantial income, which flows to a professional corporation, the Dr. Myles MacLennan OMFS Prof. Corp. [Corporation], of which he is the sole shareholder. Loren has, throughout the parties’ marriage, been a full-time stay-at-home parent and homemaker. As of the date of the application, she was also taking on-line classes at Harvard University. [ 5 ] Myles and Loren have seven children.

At the time of the application that led to the Chambers Decision and Corrigendum , the three eldest children had reached the age of majority. The remaining four children were all under 18 years of age. [ 6 ] Two of the children who had reached the age of majority were full-time students, attending post-secondary institutions. One of those two was still living in the family home; the other was living in Vancouver and attending the University of British Columbia. The third adult child was no longer in school, but still lived in the family home. [ 7 ] The MacLennans enjoyed an affluent lifestyle.

Myles, Loren and the children have had the opportunity to live in a lavish family home, travel extensively and enjoy many of the other material benefits of wealth. [ 8 ] Myles and Loren continued to live in the family home immediately after they separated. However, on September 27, 2019, they executed a formal Interim Parenting Agreement [IPA], which provided that they would have joint custody and exercise equal-time shared parenting of the minor children.

Given this arrangement and the size of their family, it made sense for them to incorporate a “nesting” arrangement, rather than shuttling the children back and forth between two homes. This meant the children remained in the family home, with Myles and Loren parenting them in the home on a rotating weekly basis. Myles and Loren also obtained separate rental accommodations for themselves, where they would reside in their off weeks. [ 9 ] Over the ensuing months, Loren and Myles attempted to negotiate the financial terms of their separation.

While this negotiation was ongoing, Loren continued to manage the family finances. Expenses were paid in the same manner they had been paid in the past. Myles and Loren agreed they would each take an “allowance” of $6,000 per month to cover their personal expenses. As it turned

out, they were unable to reach a satisfactory agreement regarding support payments going forward. That led to Loren’s application forchild support and spousal support, which resulted in the Chambers Decision and Corrigendum. [10] Myles now appeals against those decisions. He asserts that the Chambers judge made several errors in both the determinationof his income and the calculation of his child and spousal support obligations. III. STANDARD OF REVIEW [11] The standard of review applicable to interim orders for child and spousal support is deferential.

In Michel v Graydon, 2020SCC 24, [2020] 11 WWR 379, the Court stated that, because child support orders are highly discretionary in nature, a “hearing judge’sfindings and inferences of fact may not be disturbed [on appeal] absent an error on an extricable question of law, a palpable and overridingerror, or a fundamental mischaracterization or misapprehension of the evidence” (at para 30).

This approach, which finds its roots inHickey v Hickey, (SCC), [1999] 2 SCR 518 at para 11, is the same in substance as that employed by this Court, whichhas consistently held that it is not entitled to intervene in decisions relating to child support or spousal support simply because it wouldhave balanced the relevant factors differently or arrived at a different conclusion.

Appellate intervention in such cases is permitted onlywhere the reasons of the judge who made the award disclose an error in principle, a significant misapprehension of the evidence, or theaward is clearly wrong (see, for example: Potzus v Potzus, 2017 SKCA 15 at para 30, 91 RFL (7th) 290 [Potzus]; Merrifield v Merrifield,2021 SKCA 85 at para 27, 58 RFL (8th) 31 [Merrifield]; Alansari v Kreke, 2020 SKCA 122 at para 3; and Wongstedt v Wongstedt, 2017SKCA 100 at para 24, [2018] 4 WWR 82 [Wongstedt]). [12] In Merrifield, Barrington-Foote J.A. observed that this standard of review is the same in substance as that which generallyapplies to discretionary decisions, meaning that an appellate court must focus on whether the reasons of the judge in the first instancedemonstrate a regard for the criteria that bear on the proper exercise of the discretionary power in question.

He went on to note that, aswith other types of interim orders in family law proceedings, appeals from interim determinations of child and spousal support orders aregenerally discouraged: [28] …Where the appeal is of an interim support order, the relevant criteria or principles are those specified in the legislation relatingto child and spousal support and the case law interpreting to that legislation. That includes – as the Chambers judge pointed out – case lawthat confirms that interim decisions must and should be made expeditiously even if there is incomplete and conflicting evidence.

Thisprinciple is often explained in the systemic terms summarized by Richards J.A. (as he then was) in Mantyka v Dueck, 2012 SKCA 109,399 Sask R 303: [47] …This Court has repeatedly discouraged appeals from interim orders in family law proceedings. See, for example: Foss v. Foss(1991), (SK CA), 31 R.F.L. (3d) 367; Graham v. Tomlinson, 2010 SKCA 101, 324 D.L.R. (4th) 156 at para. 15; Daukv. Law, 2005 SKCA 145, 275 Sask. R. 158 at para. 6; Hall v. Hall, 2011 SKCA 86, 337 D.L.R. (4th) 89 at para.1.

It has taken thisapproach in an effort to help litigants avoid both the delays that such appeals necessarily involve and, as well, to avoid the cost of suchproceedings.

As Jackson J.A. said in Hall “[i]n most cases, the interests of the parties, and the children, are best served by proceedingquickly to the pre-trial settlement conference stage rather than expending time and scarce resources on an appeal from an interim order”. [29] The following comments by Wilkinson J. in Potzus also stress the significance of the fact these are interim orders, particularly incases involving high-income earners and families with high net worth: [111] Where a trial is pending, it is not the function of a Chambers judge to make “bell-weather orders” predicting, to a nicety, theoutcome at trial: see Dyck v Dyck, 2008 MBCA 135 at para 30, 77 RFL (6th) 70.

Nor is it a Chambers judge’s task to find the rightnumber for the long term, especially where there are complex issues in relation to income attribution from corporate earnings and thesupport obligations for high-income earners. An individual earning annual income in excess of $150,000 is more capable than most oftolerating margins of error in interim, stop-gap orders. Where the family property falls into the multi-million dollar range, there isconsiderable malleability when it comes to making equitable adjustments in the final outcome.

To front-end load every conceivableargument onto a Chambers judge in an interim support application pre-empts the investigation that is properly the function of the trialjudge. A trial is the natural forum for arguments of the kind that were advanced here. There, testimony can be scrupulously examined andissues explored with the benefit of a full and complete evidentiary foundation.

Decisions as to interim support are always modifiable attrial, where they can be assessed based on the entirety of the evidence: Linn v Frank, 2014 SKCA 87, [2014] 10 WWR 215; and Ford vFord, 2015 SKCA 23, 457 Sask R 19. [13] A deferential standard of review does not mean a Chambers judge has free rein. “Interim decisions relating to child and spousalsupport must be made judicially, having regard to the applicable criteria” (Merrifield at para 30).

However, appellate courts mustrecognize the reality that Chambers judges will often be faced with shortcomings in the evidence at the interim stage, especially where thefactual matrix relevant to determining the needs of the parties and the income available for support purposes is complex. IV. ANALYSIS [14] Myles does not dispute that he is obligated to pay child support or that Loren is entitled to spousal support. He asserts, however,that the Chambers judge erred in the determination of (

i) his income for the purpose of calculating his support obligations and (ii) theamount of interim child and spousal support he was required to pay. [15] Loren concedes that the Chambers judge’s roadmap may have been flawed, but maintains that he reached the correctdestination with respect to both the determination of Myles’s income and the calculation of his support obligations. [16] For reasons that I will explain, I find no basis to interfere with the Chambers judge’s interim determination of Myles’s income.However, the Chambers judge made several errors in determining the amount of interim child support and interim spousal support payableby Myles, such that it is necessary to conduct a fresh analysis.

A. Determination of Income [17] The Chambers judge “imputed” an annual income of $1,500,000 to Myles for the purpose of calculating his child and spousalsupport obligations. In coming to this conclusion, he determined that Myles’s average reported personal income over the previous threeyears (2017–​2019) had been $1,373,948, and that this was the “best and most reliable information available” (Chambers Decision at para26).

The Chambers judge found this to be so because, even though Myles’s income projections for 2020 were less favourable due torestrictions resulting from the COVID-19 pandemic, any temporary decrease in income was unlikely to be long-lasting. He alsodetermined that Myles’s reported personal income did not represent all of the income he had available for support purposes because hisCorporation had significant retained earnings. [18] Myles raises several arguments in relation to the issue of income determination.

His chief complaint is that the Chambers judgeerred by using historical income information rather than the most current income information to fix his income for support purposes. Hesays this was an improper approach because the evidence demonstrated that his income had fallen dramatically, beginning in March of2020, due to a reduction in the number of surgeries he and the other practitioners in his office were able to perform in the wake ofrestrictions arising from COVID-19.

Myles says this meant his income from previous years was no longer indicative of his “current andfuture” earning capacity and argues that the Chambers judge failed to take that into account. [19] Myles also asserts that, in making factual findings relevant to the determination of his income, the Chambers judge relied on aninaccurate

summary of the evidence that was contained in Loren’s brief of law. [20] Finally, Myles contends the Chambers judge erred by attributing the pre-tax income of the Corporation to him for supportpurposes. [21] As I will explain, I find no reviewable error in the Chambers judge’s determination of Myles’s income. In my view, theChambers judge’s factual determinations were supported by the evidence, and he exercised his discretion in a way that conformed with theapplicable legal principles. As such, his conclusion as to Myles’s income is entitled to deference. [22]

Section 15 of the Federal Child Support Guidelines, SOR/97-175 [Guidelines] provides that a spouse’s annual income, forchild support purposes, is to be calculated in accordance with ss. 16–20.

Section 16 requires income to be determined by the sources setout under the heading “Total income” in the Canada Revenue Agency’s T1 General form, adjusted in accordance with

Schedule III.Section 16 also states that this determination is “[s]ubject to sections 17 to 20”. The objective of these sections is to “find an amount thatfully and fairly reflects the income available for payment of support” (Potzus at para 76). [23]

Section 17 permits deviation from the method of calculation set out in s. 16, by using a three-year average in cases where,because of fluctuation of income or the receipt of non-recurring amounts, the calculation under s. 16 would not result in the fairestdetermination of income. Sections 18 and 19 also permit deviation from the method of calculation set out in s.

Section 18 provides forattribution of corporate income to a person who is a shareholder, director, or officer of a corporation where that person’s income, asdetermined under s. 16 of the Guidelines, does not fairly represent the amount available for child support purposes.

Section 19 permitsimputation of income in certain circumstances. [24] In Olchowecki v Olchowecki, 2005 SKQB 144, 267 Sask R 83 [Olchowecki], Wilkinson J. described the step-by-step approachthat is to be applied in determining income for child support purposes where, as here, there are issues as to whether the payor spouse’scurrent income differs materially from their income in recent years: [10] The basic approach in the determination of income is therefore: (1) to employ s. 16 to determine annual income for the year in which the application is heard, using the most current source(

s) of incomeinformation available; (2) the combined effect of ss. 16 and 17 dictates that if there is a material difference between the historical pattern of income and thedetermination under s. 16, the latter should be questioned for fairness; (3) the mere fact of difference does not make the s. 16 determination unfair. The degree of permanence associated with the difference, thequality of the change in income from historical levels, and the reasons giving rise to the change must all be considered: See Fuzi v. Fuzi, (BC SC), [1999] B.C.J. No. 2263 (B.C.

S.C.) (QL); (4) there is an additional test of fairness applied to a s. 16 determination of income if s. 18 is implicated. If the income earner is ashareholder, director or officer of a corporation, the determination of income may include: (

a) all or part of the pre-tax income of the corporation or any related corporation for the most recent taxation year; or, (

b) an amount not exceeding that pre-tax income which is commensurate with the services provided to the corporation.

Added to the pre-tax income are any amounts paid to or on behalf of persons who are not at “arm’s length” unless the payments areproved to be reasonable; (5) fairness in the application of s. 18 will depend on the nature of the relationship between the income earner and the corporation, thenature of the corporation’s business, the legitimate calls on the corporate income, and the corporation’s capitalization requirements, withthe court having the ability to consider the historical income pattern of the spouse and non-recurring gains or losses: See: Kowalewich v.Kowalewich, 2001 BCCA 450, (2001), 19 R.F.L. (5th) 330 (B.C.C.A.) and Boser v.

Boser, 2003 SKQB 477, (2003) 240 Sask. R. 55(Q.B.); (6) lastly, s. 19 operates to impute additional income in appropriate circumstances, including, but not limited to, the enumerated situationsin subparagraphs (

a) through (i). Furthermore, imputed income can be used for the purpose of determining a pattern of income over three

years pursuant to s. 17 as well as current income: See: Schnell v. Schnell , 2001 SKCA 123 , (2001), 213 Sask. R. 174 (C.A.) . [ 25 ] Olchowecki has been cited with approval by this Court in several cases, including Merrifield ; Walker v Walker , 2019 SKCA 96 , 31 RFL (8th) 310 [ Walker ] and M.H. v A.B. , 2019 SKCA 135 , 36 RFL (8th) 261 [ M.H. ]. [ 26 ] The test for attribution of corporate pre-tax income under s. 18 is one of fairness.

Where the payor spouse is the sole shareholder of the corporation, he or she bears the onus of establishing that the pre-tax corporate income is not available for child support purposes ( Labrecque v Labrecque , 2014 SKCA 59 at paras 17–18 , 438 Sask R 170).

In Dungey v Dungey , 2020 SKCA 138 , [2021] 3 WWR 1, Tholl J.A. explained the principles that apply to the attribution of pre-tax corporate income as follows: [73] When a payor spouse is the sole owner of a corporation, all or part of the pre-tax corporate income is available as income for the payment of support, subject to the corporation’s reasonable business needs, obligations and management of risk : Bear v Thompso n , 2014 SKCA 111 , 378 DLR (4th) 649 [ Bear ], Potzus v Potzus , 2017 SKCA 15 , [2017] 7 WWR 296, and Walker .

While the attribution of corporate income is limited to the amount of the most current year’s pre-tax corporate income, a court is fully entitled to scrutinize a corporation’s historical earnings and other financial information to determine what portion of the current year’s income should be attributed: Bear at para 74 and Potzus at para 78 .

The objective of analyzing all potential sources of the payor’s income is to arrive at an amount that fully and fairly reflects the income available for support purposes: M.H. v A.B ., 2019 SKCA 135 , 36 RFL (8th) 261. [ 27 ] The purpose of analyzing all potential sources of income, including that which may be attributed under s. 18, is to arrive at an amount that fully and fairly reflects the income available for support purposes. Each case must be decided on its own facts ( Merrifield at paras 47–48 ). [ 28 ]

Section 19 of the Guidelines confers a further judicial discretion to impute income where the payor spouse’s income as listed in their tax return does not truly represent the income available for child support purposes.

In that respect, s. 19 is inextricably linked to, and designed to work in tandem with, s. 18 ( Walker at paras 28–31 ; M.H. at para 88 ). [ 29 ] The evidence before the Chambers judge was that the “Total Income” Myles reported in his tax returns in the four previous years had been as follows: 2016: $1,648,689 2017: $1,522,057 2018: $1,361,600 2019: $1,280,008 [ 30 ] Over that time period, the reported pre-tax income of the Corporation (net of the income that it paid to Myles as set out in the preceding paragraph) was as follows: 2016: $499,927 2017: $560,389 2018: $621,853 2019: $1,263,922 [ 31 ] During that period, the retained earnings of the Corporation also increased from $1,545,544 to $3,375,970.

As stated earlier, Myles was the sole shareholder and director of the Corporation. The evidence also reflected that the Corporation had paid an annual salary of $47,000 to Loren in each of 2017, 2018 and 2019, which she no longer received after she and Myles separated. [ 32 ] Myles led evidence on the application showing that the Corporation’s revenues from performing surgeries had dropped sharply in April and May of 2020, following the imposition of restrictions related to COVID-19.

He tendered a letter written by one of the other surgeons in his practice projecting that, as a whole, their revenues for 2020 were expected to be only 65 percent of what they had traditionally been because of those restrictions. He also led evidence in the form of an e-mail from his corporate accountant predicting lower cash flows for the Corporation in 2020 and stating that for tax reasons, the reported corporate income did not reflect a large bonus paid to Myles and that going forward, all of the Corporation’s revenues would be paid to Myles as salary.

Myles argued that, considering this evidence, an annual income of $975,000 should be imputed to him. [ 33 ] The Ch ambers judge rejected that suggestion. He said: [24] I do not accept Myles’ suggestion that I impute income of $975,000 to him. That amount would understate his earning capacity, based on past income. [25] Many people may experience a temporary decrease in income due to the extraordinary event of the pandemic. While some businesses will fail, others will continue and adapt. Demand for medical services is unlikely to drop for long.

While the monthly deposits of the professional corporation did fall dramatically in May 2020, they recovered in July. [26] Myles reported income information over the past three years is the best and most reliable information available to the court. But, as shown above, it does not include all the income available for support purposes, since the professional corporation may retain earnings for investment.

Also, Loren's loss of income, in the form of salary and dividends from the professional corporation, is presumably the benefit of Myles. [ 34 ] As stated above, I see no basis to interfere with the Chambers judge’s determination of Myles’s income. First, the conclusion

that Myles’s reported income from the previous three years was the best and most reliable information from which to determine hisincome is a finding of fact that is entitled to deference absent a palpable and overriding error. I see no such error here. [35] Second, even though the Chambers judge did not provide an explicit self-instruction on this issue in the Chambers Decision, itis apparent from his reasons that he followed the approach set out in the Guidelines and the governing jurisprudence to determine Myles’sincome.

In that regard, he began by examining the pertinent and most current information concerning Myles’s total income, in accordancewith s. 16. He concluded that the current income projections Myles had put forth would not fairly represent the income available forsupport purposes, because his past earnings had consistently been much greater than that and the recent decrease in his income due toCOVID19 appeared to be only temporary.

This factual finding has an evidentiary basis and it is entitled to deference. [36] The Chambers judge went on to find that, because of this, Myles’s reported income over the last three years was the mostreliable information. This reflects an application of s. 17 of the Guidelines. In doing this, the Chambers judge misstated Myles’s reportedpersonal income for 2019 (at paragraph 20 of the Chambers Decision he stated the amount to be $1,232,187.22, when the amountrecorded in Myles’s 2019 tax return was actually $1,280,008.72), but this error was harmless.

If anything, it was to Myles’s benefit. [37] Then, as required, the Chambers judge turned his mind to s. 18 of the Guidelines and considered the amount of corporate pre-tax income that was available to Myles. He noted that, in addition to recording a sizable pre-tax income, the earnings retained by Myles’sCorporation had steadily increased over the years preceding the application.

The Chambers judge was entitled to take this into account inthe way that he did; an analysis of the historical earning patterns of a corporation is proper, as it may assist in determining how much ofthe corporation’s pre-tax income for the most recent tax year should be attributed (Bear v Thompson, 2014 SKCA 111 at paras 56 and 74,446 Sask R 160; Potzus at para 16; see also Dungey at para 73). [38] While the Chambers judge did not explain precisely how he arrived at the figure of $1,500,000 for Myles’s income, it isapparent that he got there by determining that a portion of the pre-tax income of Myles’s Corporation was available to him for supportpurposes.

As set out above, the total income reported in Myles’s 2019 T1 tax return was $1,280,008. Concluding that Myles’s income was$1,500,000 meant the Chambers judge deemed approximately $220,000 of the Corporation’s pre-tax income to be available for supportpurposes. This represented only a fraction of the Corporation’s total pre-tax income for 2019. I see no error in the Chambers judge’sapproach to the inclusion of corporate income when his reasons are examined through the filter of the governing jurisprudence. As thesole director and shareholder, Myles controlled the Corporation.

The evidence that the Corporation had competing needs and obligationswas limited. While the reasoning of the Chambers judge as to potential impact of COVID-19 on Myles’s income could be characterized assomewhat speculative, it did not—when considered in the context of the evidence as a whole—cast doubt on his bottom-line conclusion. Isay this because there was clear evidence that, when the total income reported in Myles’s T1 tax return was added to the pre-tax income ofthe Corporation, it had always exceeded $1,500,000 by a substantial margin in each of the preceding years.

Apart from the impact ofCOVID-19, there was no other basis to expect those numbers to decrease going forward. [39] Similarly, while the Chambers judge incorrectly used the term “impute” in paragraph 27, rather than “attribute”, when referringto the operation of s. 18, I am not persuaded that this mistake affected the substance of his analysis. The focus in a case such as this mustremain on making a fair determination of the amount of income actually available for child support purposes. The Chambers judge’sreasons demonstrate that he kept his focus in the right place.

Considering that this was an interim decision, and not a final decision madewith the benefit of a full evidentiary picture, I see no basis to intervene. B. Determination of Child Support and Spousal Support [40] Once the Chambers judge had established Myles’s income for the purposes of calculating his support obligations, he went on todetermine the amount of child support and spousal support that was payable. As I will demonstrate, the Chambers judge made severalerrors in setting those amounts.

The factual matrix of this case involved a large family with several adult children, a payor parent with anincome that greatly exceeded the ceilings set out in the Guidelines and Carol Rogerson and Rollie Thompson’s Spousal Support AdvisoryGuidelines ([Ottawa]: Department of Justice Canada, 2008) [SSAG], and a shared parenting situation with a non-traditional nestingarrangement. In light of these factors, a nuanced and thorough analysis was called for and, with respect, the Chambers judge failed toconduct such an analysis.

That error had a material impact on the result and, as such, this Court is required to intervene. 1. The Chambers Decision [41] The Chambers judge began by considering which children were still “children of the marriage” for the purposes of childsupport. This was necessary because three of the children had reached the age of majority. The Chambers judge determined that, becausetwo of the adult children were still full-time university students who had always been financially supported by their parents, they remainedentitled to child support.

Because the remaining adult child was no longer a student, she was no longer a “child of the marriage” for thatpurpose (Chambers Decision at paras 28–34). [42] The Chambers judge then turned his attention to s. 4 of the Guidelines, observing that the determination that must be made incases where the payor spouse’s income exceeds $150,000 is whether the s. 3 table amount of support is inappropriate.

Citing Francis vBaker, (SCC), [1999] 3 SCR 250 [Francis], he noted that there “is a presumption in favour of the table amounts” andthat the Guidelines are designed to ensure that the breakdown in the parents’ marriage “will affect the children as little possible” (at para37). Referring to the evidence regarding their annual expenditures, he commented that “this family enjoyed a lifestyle unfamiliar to mostresidents of Saskatchewan” (at para 38).

Then, relying on Potzus, he determined that the table amount of child support in the Guidelineswould not be inappropriate, stating: [40] …A support order consistent with the Guidelines would ensure that the children entitled to support continue to live in a manner towhich they have become accustomed and in which the parents wish them to live. Myles has the financial ability to make the requiredpayment.

Loren does not have the capacity to contribute to their financial support without it. [43] Using the formula set out in the Guidelines and the incomes he had determined for Myles and Loren, the Chambers judgeperformed a simple set-off and calculated the monthly child support payable by Myles as $33,000. In doing so, he rejected the argument

that Myles should instead be allowed to continue to pay the household expenses in lieu of a portion of that support, saying “[t]he payment of child support by Myles to Loren ensures that both parents are able to contribute equally to the financial support of their children” (at paras 42–44). [ 44 ] Moving on to spousal support, the Chambers judge first addressed the issue of entitlement. He determined that, based on “the long marriage and the roles played by both parents”, Loren was entitled to support on “both a compensatory and non-compensatory basis” (at para 45).

Next, he observed that caution was necessary when determining quantum of support under the SSAG where the payor spouse’s income exceeds the $350,000 ceiling. He then explained his determination of the amount of spousal support that Myles must pay by saying: [47] Loren, in her lawyer’s brief of law at appendix I, provided a calculation from Childview 2019.2.0 assuming 23 years of cohabitation and incomes of $1.5 million for Myles and $50,000 for Loren. It calculates a range of monthly spousal support from $18,919 to $36,013, with a mid-range of $27,466.

The second page provides “The Spousal Support Advisory Guidelines With Children Support Formula Using Revised Child Support Amounts – July 2019 Forward Calculations”, using the monthly s. 3 table amount revised to $22,000. Again, I accept this calculation. [48] I will award monthly spousal support of $22,000 to Loren. 2. The Corrigendum [ 45 ] Following the release of the Chambers Decision , the parties raised a concern regarding the child and spousal support amounts determined by the Chambers judge.

Through counsel, Loren wrote to advise the Court that her position had been that the parties’ monthly cash flow should be equalized and that this would be accomplished by a monthly child support payment in the amount of $22,000 and a monthly spousal support payment of $19,000. A conference call was convened, and further submissions were heard on September 3, 2020. [ 46 ] One week later, the Chambers judge issued the Corrigendum .

In it, he explained that he had made an accidental slip in the Chambers Decision when calculating the appropriate child and spousal support payments and determined that Myles should pay child support of $22,000 per month and spousal support of $19,000 per month. He explained his reasoning as follows: [3] As stated in para. 42 of [the Chambers Decision ], my intent was to ensure “that both parents are able to contribute equally to the financial support of their children”. If so, then the result should have been to provide the parties with as close to 50% of the available, combined incomes.

In fact, as counsel points out, the monthly amounts awarded of $33,000 for child support and $22,000 for spousal support would skew the incomes away from that intended result. … [6] Rule 10-10(

a) applies to “errors arising from an accidental slip”. I reversed the amounts for child and spousal support taken from the Childview calculation. So the child support should have been $22,000, not $33,000. The $22,000 amount was erroneously stated for spousal support. I therefore substitute $22,000 , instead of $33,000, for child support. … [7] Rule 10-10(

b) applies to the spousal support calculation. There are two errors in calculation. [8] First, it appears I overlooked para. 100 of the petitioner’s brief of law in which the petitioner proposed that, if child support was $22,000 was ordered, as will now be done, then the spousal support amount should be lowered to equalize cash flow/income on an interim basis.

The petitioner, at page 1 of tab I of its brief, provided a range of $19,000 - $36,000, based upon child support of $22,000 per month. [9] The petitioner has proposed a spousal support order of $19,000 per month would achieve the intent of the [ Chambers Decision ]. The respondent agrees. I therefore substitute $19,000 , instead of $22,000, for spousal support. (Emphasis in original) 3. Legal principles governing the calculation of child support [ 47 ]

Section 15.1(1) of the Divorce Act , RSC 1985, c 3 (2d Supp) permits a court to “make an order requiring a spouse to pay for the support of any or all children of the marriage”. Subsection (2) provides that such orders can be made on an interim basis, and s. 15.1(3) requires the court making such an order to “do so in accordance with the applicable guidelines”. The term “child of the marriage” is defined as follows in s. 2: child of the marriage means a child of two spouses or former spouses who, at the material time, (

a) is under the age of majority and who has not withdrawn from their charge, or (

b) is the age of majority or over and under their charge but unable, by reason of illness, disability or other cause, to withdraw from their charge or to obtain the necessaries of life; [ 48 ] For children under the age of majority, s. 3(1) (

a) of the Guidelines provides that the amount of child support payable is determined by the amount set out in the applicable table, unless “otherwise provided under [the] Guidelines ”. [ 49 ] Two circumstances in which the Guidelines “otherwise provide”, such that the presumptive rule in s. 3(1) (

a) may not apply, are relevant in this case. [ 50 ] The first is where one or more of the children of the marriage are over the age of majority. In that respect, s. 3(2) provides as follows:

3(2) Unless otherwise provided under these Guidelines, where a child to whom a child support order relates is the age of majority or over,the amount of the child support order is (

a) the amount determined by applying these Guidelines as if the child were under the age of majority; or (

b) if the court considers that approach to be inappropriate, the amount that it considers appropriate, having regard to the condition, means,needs and other circumstances of the child and the financial ability of each spouse to contribute to the support of the child. [51] The second is where the annual income of the payor parent exceeds $150,000. Where that is the case, s. 4 provides: 4 Where the income of the spouse against whom a child support order is sought is over $150,000, the amount of a child support order is (

a) the amount determined under

section 3; or (

b) if the court considers that amount to be inappropriate, (

i) in respect of the first $150,000 of the spouse’s income, the amount set out in the applicable table for the number of children under theage of majority to whom the order relates; (ii) in respect of the balance of the spouse’s income, the amount that the court considers appropriate, having regard to the condition,means, needs and other circumstances of the children who are entitled to support and the financial ability of each spouse to contribute tothe support of the children; and (iii) the amount, if any, determined under

section 7. [52] Once a child reaches the age of 18, there is no longer a continuing presumption of entitlement to child support.

A parent whoseeks a support order in respect of an adult child bears the onus of proving that, at the material time, the adult child falls within thedefinition of “child of the marriage” in s. 2, i.e., that they are unable to withdraw from the parents’ charge or to obtain the necessaries oflife by reason of illness, disability or some other cause (Wetsch v Kuski, 2017 SKCA 77 at para 41, 1 RFL (8th) 290 [Wetsch]; Geran vGeran, 2011 SKCA 55 at paras 8–13, [2011] 10 WWR 474 [Geran]; Ethier v Skrudland, 2011 SKCA 17 at para 17, [2011] 4 WWR 608). [53] The pursuit of post-secondary education by an adult child is well-recognized in the jurisprudence as constituting “some othercause” that provides a basis for continuing entitlement to support.

However, entitlement on that basis is not automatic; determiningwhether support should continue for a child who has reached the age of majority always calls for an inquiry into the existence of and, ifnecessary, the extent of the parents’ obligation to provide that support.

Where the pursuit of post-secondary education is the basis for theapplication for child support, a variety of factors must be considered, including “the reasonableness of the decision to pursue an advancededucation, the reasonableness or otherwise of the child’s expectations relative to the reasonable parent, the needs and means of the child,and the situation of the parents” (Geran at para 21). [54] Once it is established that an adult child is entitled to support, the court must decide whether the amount of that support shouldbe determined in accordance with s. 3(2)(

a) or s. 3(2)(

b) of the Guidelines. This gives rise to a second threshold question, namely whetherit would be inappropriate in the circumstances to calculate the quantum of support by applying by the table amounts set out in theGuidelines. If the table amount is inappropriate, the determination of the amount payable is made by applying s. 3(2)(b); otherwise, theapproach under s. 3(2)(

a) is the presumed approach (Wetsch at para 40). [55] In Geran, Cameron J.A. described the principles that underpin the difference in approach between s. 3(2)(

a) and s. 3(2)(b), andthe approach to determining the second threshold question, as follows: [52] The tables, which form part of the Guidelines, incorporate amounts intended to reflect the average percentage of income Canadianfamilies spend in raising children. The amounts vary depending upon the number of children and the income of the parent required to paythe amount. Only the income of this parent is considered.

The reason for this lies in the two-fold assumption, first, that the other parentcontributes to the support of the children by providing directly for their care and, second, that if the other is also earning an income he orshe will spend proportionately the same amount on the children as the paying parent.

The amounts specified by the tables are based on thefurther assumption—particularly relevant to this case—that the children, being under the age of majority, have no incomes of their own. … [55] As contemplated by subsection 3(2)(a), the court may settle on the amount called for by the presumptive rule of subsection 3(1),“as if the child were under the age of majority.” Doing so entails resort to the amount specified in the applicable table (and to

section 7should there exist special or extraordinary expenses). This is commonly referred to as the usual Guideline approach. But, as subsection3(2)(

b) recognizes, this approach may be “inappropriate”. In that event, an “appropriate” amount is to be determined in accordance withsubsection 3(2)(b). The provisions of subsection 3(2)(

b) posit quite a different approach, one that envisions determining the amount basedon the actual, rather than presumed, needs and means and circumstances of the child, and the actual rather than the presumed financialability of each of the parents. [56] Obviously, the key to employing one or the other of these approaches lies in whether the first is “inappropriate”, in which event an“appropriate” amount is to be determined in keeping with the second. These terms, which appear in both subsections 3(2) and 4(

b) of theGuidelines, were taken by this Court in Hagen v. Rankin to have the same meaning in relation to both. Their meaning was explained by theCourt in the case of Dergousoff v. Dergousoff (1999), (SK CA), 48 R.F.L. (4th) 1: [67] The word “inappropriate” is the opposite of “appropriate,” both relative terms having to do with something which is eitherunsuited or suited to the occasion or purpose at hand.

Since, in this instance, the term “inappropriate” modifies the word “amount,” used inthe sense of a specified sum of money, the term speaks to an unsuitable amount: to a sum of money which, while specified for thepurpose, is in fact unsuited to that purpose. Hence, to speak of an inappropriate amount of money is to speak of a sum which either

exceeds or falls short of the purpose. If it exceeds the purpose it is inappropriate to the extent of the excess; if it falls short of its purpose,it is inappropriate to the extent of the shortfall. If it does neither, the amount is appropriate. (Emphasis in original) [56] As Cameron J.A. notes in this passage, one of the basic assumptions underlying the calculation of the table amounts in theGuidelines is that children under the age of majority have no income or resources of their own.

However, where an adult child earnssubstantial income or has access to other funds, those are factors that can shift the baseline circumstances of the adult child away fromthose of a minor child and render the table amounts inappropriate. In Wetsch, Caldwell J.A. wrote: [51] While the reasons in Geran v Geran speak to employment income only, they reveal that the principle is of broader application.

Ona principled basis, any factor or combination of factors that shifts the circumstances away from the assumptions upon which the Tableamounts are predicated serves to cast doubt upon the appropriateness of approaching child support under s. 3(2)(

a) of the Guidelines… … [55] The greater the shift away from these baseline assumptions, the more likely it is that s. 3(2)(

a) of the Guidelines will beinappropriate. Importantly, Bastarache J. held in Francis v Baker that the payor has the onus of rebutting the presumption of Table supportbut could do so by simply “raising a concern” that such support is inappropriate. In Tauber v Tauber (2000), (ON CA),187 DLR (4th) 1 (Ont CA) at 39, Rosenberg J.A. found this threshold could be met with a prima facie case.

In Gould v Gould, 2013SKCA 34 at para 31, 414 Sask R 30, Ottenbreit J.A. noted that, once the issue is raised, “the ‘evidence of inappropriateness’ in its entiretymust be sufficient to raise a concern and it must be clear and compelling.” On this basis, I conclude that, while there is an element ofdiscretion in ascertaining the inappropriateness of Table support, once a prima facie case has been made out to the effect that basicassumptions underpinning the Table amounts have been displaced, the calculation of child support under s. 3(2)(

a) will be inappropriate. … [58] In short, approaching child support under s. 3(2)(

a) will be inappropriate where a payor parent has established—on the basis of aprima facie case grounded in clear and compelling evidence of the condition, means, needs and other circumstances of the adult child ofthe marriage or the financial ability of each parent to contribute to the support of the child—that a basic assumption underpinning theTable amounts has been displaced. In which case, it would be an error in principle not to approach the matter under s. 3(2)(

b) of theGuidelines. [57] As described above, the court has discretion to depart from the table amount in the Guidelines for minor children as well, if thetable amount is inappropriate. In Merrifield, Barrington-Foote J.A. described the nature of the analysis required for determining theamount of child support payable by a high-income-earning parent: [64] The leading case as to the analytical framework to be applied when determining if s. 4(

b) applies is Francis v Baker, (SCC), [1999] 3 SCR 250 [Francis]. Francis confirms that there is a presumption in favour of the Guideline amount, and that theremust be “clear and compelling evidence” that the Guideline amount is inappropriate before a judge can depart from it. It holds that theremust be an articulable reason for displacing the Guidelines, based on all relevant circumstances. Those include the matters listed in s. 4(b)(ii), which are relevant considerations when calculating the appropriate amount.

The party seeking a departure from the Guidelines bearsthe persuasive burden but need not lead evidence themselves. They may instead rely on the evidence led by the prospective payee(Francis at paras 42–44). … [69] As I have noted above, the issue is not whether the Guideline amount exceeds the cost of basic necessities for the children, or, forthat matter, the cost of providing them with a comfortable middle-class existence. This is a high-income family and child support must beassessed accordingly.

The following comments by Bastarache J. in Francis, which stress both a generous approach to the children of high-income parents and the proper limits of that generosity – are particularly instructive in this case: [41] …[C]hild support undeniably involves some form of wealth transfer to the children and will often produce an indirect benefit tothe custodial parent.

However, even though the Guidelines have their own stated objectives, they have not displaced the Divorce Act,which clearly dictates that maintenance of the children, rather than household equalization or spousal support, is the objective of childsupport payments.

Section 26.1(2) of the Act states that “[t]he guidelines shall be based on the principle that spouses have a joint financialobligation to maintain the children of the marriage in accordance with their relative abilities to contribute to the performance of thatobligation” (emphasis added). While standard of living may be a consideration in assessing need, at a certain point, support payments willmeet even a wealthy child’s reasonable needs.

In some cases, courts may conclude that the applicable Guideline figure is so in excess ofthe children’s reasonable needs that it must be considered to be a functional wealth transfer to a parent or de facto spousal support. …courts must therefore have the discretion to remedy situations where Table amounts are so in excess of the children’s reasonable needs soas no longer to qualify as child support.

This is only possible if the word “inappropriate” in s. 4 is interpreted to mean “unsuitable” ratherthan merely “inadequate”. (Emphasis in original) [58] As observed in this passage, it is important for a court making a child support order in relation to a high-income-earning parentto bear in mind that the basic purpose of child support payments is the maintenance of children. Child support is not intended to be ameans to equalize household incomes, transfer wealth between spouses or provide spousal support.

The table amounts will beinappropriate where they are so in excess of the children’s reasonable needs so as to no longer qualify as child support. [59]

Section 9 of the Guidelines speaks to the determination of the amount of child support payable in shared parenting situations. Itprovides as follows: 9 If each spouse exercises not less than 40% of parenting time with a child over the course of a year, the amount of the child support order

must be determined by taking into account (

a) the amounts set out in the applicable tables for each of the spouses; (

b) the increased costs of shared parenting time arrangements; and (

c) the conditions, means, needs and other circumstances of each spouse and of any child for whom support is sought. [ 60 ] The three factors in s. 9 structure the exercise of a Chambers judge’s discretion. As the Supreme Court observed in Contino v Leonelli-Contino , 2005 SCC 63 at para 27 , [2005] 3 SCR 217 [ Contino ], none of three criteria listed in s. 9 takes priority over the others; they are to be read conjunctively. This is because the goal of s. 9 is to “allow sufficient flexibility to ensure that the economic reality and particular circumstances of each family are properly accounted for.

It is meant to ensure a fair level of child support”. Recognizing that shared parenting can take a number of different forms, Contino instructs that the application of s. 9 “warrants emphasis on flexibility and fairness” and calls for “the acknowledgment of the overall situation of the parents (condition and means) and the needs of the children. The weight of each factor under s. 9 will vary according to the particular facts of each case” (at para 39). [ 61 ] Several principles emerge from Contino to guide the weighing and balancing of the factors in s. 9 .

The first is that a simple set- off of the table amounts payable by each parent may serve as a useful starting point but cannot be the end point of the inquiry.

Judges retain discretion to modify the set-off amount where, considering the financial realities of the parents, a simple set-off would lead to significant variation in the standard of living experienced by the children as they move from one household to the other (at paras 49–51). [ 62 ] Second, judges must recognize that the table amounts in the Guidelines do not assume that the payor parent is responsible for the cost of the children’s housing, food, clothing and the like.

Under s. 9(b), the court will generally be required to examine the budgets and actual expenditures of both parents in addressing the needs of the children to determine whether, and to what degree, the exercise of a shared parenting arrangement has increased costs (i.e., those resulting from duplication inherent in the children having two homes) (at para 52). [ 63 ] Third, s. 9(

c) vests the court with broad discretion to analyse the resources and needs of both the parents and the children. This is often where the rubber truly meets the road, so to speak, in the analysis, as Bastarache J. explained: [68]

Section 9(

c) vests the court a broad discretion for conducting an analysis of the resources and needs of both the parents and the children. As mentioned earlier, this suggests that the Table amounts used in the simple set-off are not presumptively applicable and that the assumptions they hold must be verified against the facts, since all three factors must be applied. Here again, it will be important to keep in mind the objectives of the Guidelines mentioned earlier, requiring a fair standard of support for the child and fair contributions from both parents.

The court will be especially concerned here with the standard of living of the child in each household and the ability of each parent to absorb the costs required to maintain the appropriate standard of living in the circumstances. [69] The Court of Appeal enumerates a number of factors to be considered under this subsection: 1. Actual spending patterns of the parents; 2. Ability of each parent to bear the increased costs of shared custody (which entails consideration of assets, liabilities, income levels and income disparities); and 3.

Standard of living for the children in each household. [70] The actual spending patterns of the parents have already been considered under s. 9(b). These factors are helpful, the last one being particularly useful for the exercise of discretion in a predictable manner.

As I indicated above, financial statements and/or child expenses budgets are necessary for a proper evaluation of s. 9(c). [71] Moreover, given the broad discretion of the court conferred by s. 9(c), a claim by a parent for special or extraordinary expenses falling within s. 7 of the Guidelines (see Appendix) can be examined directly in s. 9 with consideration of all the other factors (see Slade v. Slade , at paras. 26-30).

Section 9(

c) is conspicuously broader than s. 7 . [ 64 ] Important in all of this is evidence. Where the parties have not provided the necessary evidence, it may be difficult for a Chambers judge to determine the amount of child support payable by conducting a full Contino analysis, but where the evidence is before the judge, the appropriate analysis must be undertaken. 4. The Chambers judge erred in the calculation of child support [ 65 ] As a starting point, I find no error in the Chambers judge’s conclusion that two of the parties’ three adult children remained entitled to child support.

In that respect, the Chambers judge based his conclusion on the fact that they were enrolled as full-time students and the fact that Myles and Loren have always fully supported them financially.

These factual determinations were well-established by the evidence and, although the Chambers judge’s analysis of the question of entitlement was very brief, I view his reasons for reaching that conclusion as falling in line with the guidance laid down by this Court in decisions such as Geran . [ 66 ] However, I do not reach the same conclusion with respect to the Chambers judge’s analysis of the amount of child support payable.

He made three errors in principle which had an impact on the determination of the amount of child support payable and, accordingly, this court is required to conduct the analysis afresh. [ 67 ] First, the Chambers judge failed to recognize that a different analysis was required in determining whether the table amounts set out in the Guidelines were “inappropriate” in relation to the adult children entitled to child support than for the four minor children.

With respect to the two adult post-secondary student children, there were clearly factors, including the family’s significant means, that ought to have been seen as displacing the basic assumptions upon which the table amounts were based. I see no indication that the Chambers judge turned his mind to that issue.

[ 68 ] Second, it would appear from both the Chambers Decision (at para 42) and the Corrigendum (at para 3) , that the Chambers judge approached the determination of the amount of child support with the goal of equalizing the parties’ incomes. This was an error in principle. He did so, at least in part, to enable Loren to contribute equally to the support of the children. That is not the purpose of child support. The purpose of child support is the maintenance of the children. [ 69 ] Third, the Chambers judge failed to undertake the analysis that the overall complexity of the situation required.

The parties had an equal-time shared parenting arrangement in place and the factual matrix relevant to the calculation of the quantum of child support was anything but straightforward. A mix of adult and minor children were entitled to child support. One of the adult children who was entitled to support lived away from the family home. The remaining children, one adult and four minors, remained in the family home in a nesting arrangement. Myles’s income had been determined to be ten times the ceiling amount set out in the Guidelines tables.

There was also evidence that Myles continued to pay all the expenses related to the family home, as well as the expenses of the adult children who were enrolled in post-secondary education. Despite all of that, the Chambers judge determined the amount of child support payable by Myles by conducting a simple set-off of the table amounts payable based on the parties’ respective incomes. Then, in the Corrigendum , he altered that amount, reducing it from $33,000 per month to $22,000 per month in order to “provide the parties with close to 50 percent of the available, combined incomes” (at para 3).

Nowhere, in any of this, does it appear that the Chambers judge conducted the sort of detailed analysis called for in light of ss. 3(2), 4 and 9 of the Guidelines and Contino . The failure to conduct such an analysis was an error in principle. 5. Calculating the appropriate amount of child support [ 70 ] Calculating the appropriate amount of child support payable by Myles in this case is anything but straightforward. As mentioned just a moment ago, the circumstances are unique. There are six children who are entitled to child support.

Two of them have reached the age of majority and are pursuing post-secondary education; one of those two lives in the family home, the other does not. The family is affluent, and the children have always experienced a standard of living which reflects that affluence.

The payor parent, Myles, has an annual income of $1,500,000 and remains responsible for payment of almost all of the family’s household expenses, including the costs associated with the general maintenance and upkeep of the family home and payment of debts springing from a $3.5 million renovation project. [ 71 ] On top of all that, the parties have implemented a shared parenting nesting arrangement in relation to the children still living in the family home.

All of this adds a wrinkle to the analysis because it displaces several of the assumptions that underlie the calculation of child support and affects the nature of the analysis required under Contino. This point was made in Saroli v Saroli , 2021 ONSC 4450 [ Saroli ]: [201] In most cases under the Divorce Act , R.S.C., 1985, c. 3 (2nd Supp .), the objective of preserving a child’s standard of living post- separation is achieved by ensuring that the parent with whom the child principally resides is not burdened with the entire cost of child- rearing.

A secondary but equally important goal of child support, in these circumstances, is to ensure that the child enjoys a relatively equal standard of living in both of their parents’ homes. [202] When a nesting arrangement is implemented, the goals of child support can be met differently. The child does not go back and forth between two households, so potential disparities in standards of living are not a concern. The child remains in the matrimonial home while the parents come and go, taking turns caring for the child.

The objectives of child support, in these circumstances, are met by ensuring that the separated spouses share the financial burden of carrying the family residence and paying for the children’s living expenses . [ 72 ] There is little in the reported jurisprudence that speaks to the question of how the existence of a nesting arrangement affects the determination of child support, especially in a high-income family. In Demerais v Demerais , 2010 SKQB 149 , 354 Sask R 276 [ Demerais ], the parties separated after 19 years of marriage.

They had three children who were entitled to child support, one of whom was 19 years of age and a post-secondary student. The husband earned an income of approximately $77,000 per year. The mother was a full- time parent who did not work outside the home. After separation, a nesting arrangement had been ordered on an interim basis, whereby the children remained in the family home, with the parents occupying the home on an alternating monthly basis. The husband had remained responsible for payment of the housing-related expenses and all of the children’s expenses that fell under s. 7 of the Guidelines .

The issues at trial included, among others, whether the nesting arrangement should continue, and how child support and spousal support should be calculated. [ 73 ] The trial judge in Demerais ultimately determined that the nesting arrangement should continue and that the payment of child support by the husband should be prorated based on the proportion of time each parent spent in the “nest” and adjusted in a way that recognized the housing expenses paid by the husband to be a benefit received by the wife in lieu of spousal support.

All of this meant that the husband was required to pay child support only in alternating months and that one half of the housing expenses he covered were deemed to be the wife’s income for the purposes of calculating the apportionment of responsibility for s. 7 expenses. The trial judge explained her reasoning as follows: [82] Since the nesting order was made in the fall of 2007, the wife has received a benefit in lieu of spousal support in the form of payments by the husband of all the mortgage payments, taxes and utilities on the family home.

That represents a benefit of roughly $822 a month looking at annual expenses for 2009 as a guide. The husband paid $19,749 that year or $1,645 a month in mortgage payments, property taxes, homeowner’s insurance, water, heat, electricity, cable, telephone, home security and house repairs. As occupation of the home was shared, half that amount (or $822 a month) represents the benefit she received in lieu of spousal support.

This was just slightly below the low end of the range suggested by the Spousal Support Advisory Guidelines by Carol Rogerson and Rollie Thompson. … [91] As all the s. 7 expenses will necessarily be fronted by the father, the bottom line (according to ChildView, Version 2009.2.0, by Evan K. Chan & Barry R. Gardiner) is a net monthly Guideline amount payable of $1,332 a month.

More specifically, this is arrived at using income of $76,805 for the husband (2009), income of $9,864 for the wife (deemed spousal support of $822 a month), Table support of $1,395 for three shared children, and s.7 expenses comprising $3,807 for post-secondary expenses and $2,759 for extraordinary extracurricular expenses. The husband’s proportionate share of s. 7 expenses is 87.16%, the wife’s share is 12.84% or $63 a month, which

is offset to produce the net monthly Guideline sum of $1,332 payable by the husband. … [93] Consistent with the nesting order, the child support will be paid to the wife only in those months she is in occupation of the family home under the nesting order, commencing with the first such month following this decision. Once the home is transferred to the wife, the amounts will of course be paid monthly in the usual way – that is, on the first day of each month until further order . The child support order will issue immediately.

As the circumstances in a year’s time will require the order to be varied, this can similarly be addressed when the matter is returned to me. (Emphasis added) [ 74 ] In Byrne v Byrne , 2015 BCSC 318 , 57 RFL (7th) 215 [ Byrne ], the parties were both income-earners. They separated after 17 years of marriage and implemented a nesting arrangement. The wife’s annual income was $93,106 and the husband’s was $73,500. On that basis, she paid approximately 60 percent of the household expenses, and he, approximately 40 percent.

The husband contended that he should be entitled to the receipt of retroactive child support because his annual income was less than that of the wife and he occupied the family home and cared for the children 78 percent of the time. [ 75 ] The trial judge in Byrne rejected the husband’s claim that he had custody of the children for 78 percent of the time and concluded that the “parties share[d] parenting of the children on no less than a 60/40 basis” (at para 66).

The trial judge also found that since it was “not a case where the children move[d] between separate homes…the circumstances [did] not qualify [the husband] to receive child support as contemplated in s. 8 or s. 9 of the Child Support Guidelines ” (at para 65). Relying in part on D.B.S. v S.R.G. , 2006 SCC 37 , [2006] 2 SCR 231, the trial judge concluded that the husband was not entitled to retroactive support. A key factor in that determination was the fact that the wife had borne a larger share of the household expenses.

In that regard, he wrote: [70] Based on the parties’ 2013 line 150 incomes, the [wife] would have been required to pay the [husband] $352 per month. However, the [wife]’s payments toward the family expenses from September to May exceed the [husband]’s payments by $9,591 or approximately $1,066 per month. [71] In D.B.S . at para. 38 the court described the objective of child support: “as much as possible, provide children with the same standard of living they enjoyed when their parents were together”.

In my view, after September 2012, the children enjoyed exactly the same standard of living in the same house with shared parenting. Although the [husband] contends that he cared for the children 78% of the time, it is clear that the parties shared equal occupancy of the house and both cared for the children in those circumstances. The [wife] paid more than one half of the household expenses and this is not a case in which the children needed additional financial support to achieve the same standard of living.

I do not accept that the [wife] was obliged to pay support in these circumstances. [72] Further, it is my conclusion, adopting the reasoning in Bjorkman , that the disproportionate amounts paid by the [wife] to meet the family expenses, while remaining in the home and caring for the children, more than offset any amount the [husband] might have been entitled to receive for support during that time. [ 76 ] In other cases, courts have treated the benefit the recipient spouse receives by way of the payor spouse paying all of the expenses related to the home in a shared parenting nesting situation as a form of spousal support and reduced the spousal support award by a corresponding amount, rather than adjusting child support (see, for example: Hughes v Erickson , 2014 BCSC 1952 ). [ 77 ] While each of these cases took different approaches to get to the end result, they were consistent in holding that the amount of support payable must be adjusted to reflect in some reasonable way the proportion of actual expenses paid by each parent.

Therefore, where one party pays a greater share — or, as in Demerais , all — of the expenses related to the upkeep of the home in a shared parenting nesting arrangement, the amount of child support properly payable to the other party may be reduced below the Guidelines table amount. [ 78 ] With those considerations in mind, I turn now to the application of the “structured discretionary approach” required by s. 9 and the principles set out in Contino . I begin by taking into account, as directed by s. 9(a), “the amounts set out in the applicable tables for each of the spouses” and calculating a simple set-off.

If the applicable table amount in this case is based on just the four minor children still living at home, the s. 3 table amount payable by Myles and Loren would be $27,991 per month, and $1,111 per month, respectively (set-off of $26,880). If it is based on the five eligible children still living at home, those amounts would be $31,919 and $1,282 (set-off of $30,637).

And, if the calculation is made on the basis of all six children who are entitled to support, the table amounts are $34,432 and $1,426 per month, respectively (set-off of $33,006). [ 79 ] Under any of those scenarios, the table amount is clearly inappropriate in this case because there is clear and compelling evidence demonstrating that the basic assumptions underpinning the table amounts have been displaced by the level of Myles’s income and the nesting arrangement.

Myles has remained exclusively responsible for payment of the children’s housing costs and Loren, as the recipient parent, has not had to bear the extra cost that would ordinarily arise from obtaining a separate residence of her own that is large enough to accommodate the children. As noted in Saroli , unlike a more traditional two-household shared parenting situation, the nesting arrangement does not bring with it many of the increased costs typically associated with the duplication inherent in the children having two homes.

Nor does it require a balancing of the standard of living enjoyed by the children in two households; the children have only one household that is relevant. Accordingly, the appropriate amount of child support payable must be determined through examination of the “condition, means, needs and circumstances of the children” and the financial ability of Myles and Loren to contribute to their support (ss. 3(2)(

b) and 4(1)(b)(iii) of the Guidelines ), guided by s. 9 of the Guidelines and the principles set out in Contino . [ 80 ] Contino instructs that regard must be had for the actual spending patterns of the parents, their respective abilities to bear the costs associated with the parenting arrangement that is in place and the standard of living of the children. [ 81 ] In this case, the evidence is that Myles has been, and continues to be, solely responsible for paying the cost of the maintenance and upkeep of the family home.

This includes making the payments on the debts arising from the renovation costs as well as paying for utilities, property taxes, homeowners insurance, house repair, maintenance, and yard care. I accept the evidence contained in Myles’s materials, which is not directly contradicted, that those costs total $8,971 per month. Loren occupies the family home 50 percent of the

time so, in effect, she receives the benefit of Myles paying $4,485.50 per month on her behalf in relation to the children’s housing costs. This affects not only the calculation of child support but, as I will detail later in these reasons, also bears on the determination of the amount of spousal support payable by Myles. [ 82 ] I turn next to the children’s vehicle-related expenses. Loren’s materials peg these at $3,145 per month. However, I would note that this figure includes a monthly loan payment of $1,640 related to the vehicle of the adult daughter who is not eligible for child support.

That amount must be removed from the calculation, which reduces the amount to $1,505. I see nothing in Myles’s evidence that raises any significant discrepancy with that figure. Given the equal-time shared parenting arrangement in place, Myles and Loren should be equally responsible for these expenses.

Therefore, I find that they are each responsible for approximately $750 per month in vehicle-related expenses for the children who are eligible for child support. [ 83 ] Other child-related household expenses, including groceries, clothing, cellular phones, sports, entertainment, pet care, insurance, prescription drugs and health costs, and the like should also be shared equally. Loren’s affidavit estimates the monthly expenditures in this respect to be $28,292. Myles calculates expenditures under this category to be $15,390 per month.

In examining Loren’s affidavit, it becomes apparent that several of the expenses she includes in this category are not properly included in this calculation, namely modelling expenses and counselling expenses for the non-eligible adult child ($2,620 per month), and education amounts (tuition and books, etc.) for the children in post-secondary education ($2,980 per month). I am also unable to accept Loren’s purported expenditure of $5,200 per month on housekeeping and babysitting. Moreover, her evidence appears to be in the form of estimates.

Myles’s evidence, on the other hand, is supported by bank and credit card records. Accordingly, I accept the figures put forward by Myles for the purpose of this analysis. Bearing in mind that some of those expenses must be seen as relating to the adult child who is not entitled to support, I would reduce that amount by 10 percent, to $13,851. One half of that — the share for which Loren is responsible in the equal-time shared parenting arrangement — is $6,925.50. [ 84 ] A third category of expenses relates to costs incurred by the two adult children who attend university.

I see no basis to treat day- to-day living expenses for these two children any differently than they are treated for the minor children, given that Myles and Loren have the means to fully support them as they pursue post-secondary education, and the evidence is that they intended to do so. However, in the circumstances, the costs of their tuition, books, lab fees and other student fees, as well as the cost of off-campus housing for the daughter who does not live in the family home and associated costs to travel home, all fall into the category of extraordinary expenses under s. 7.

The parties, in my view, should contribute to these expenses in a share proportionate to their respective incomes.

While spousal support received by Loren is not properly considered as income for determining child support obligations under ss. 3 and 4 of the Guidelines , it is properly included as income for determining her share of responsibility for s. 7 expenses. [ 85 ] Taking into account what I have found to be Loren’s share of the regular monthly expenditures that are generally meant to be covered by child support under s. 3 of the Guidelines , considering the other expenses that Myles covers, and making allowance for expenses related to vacation and travel for the children, unexpected expenses and emergencies, I am satisfied that child support payable to Loren in the amount of $12,000.00 per month is appropriate.

In my view, this is a fair amount that has due regard for the parties’ means and traditional spending patterns, maintains a fair standard of support for the children and provides for a fair contribution from each parent. [ 86 ] In addition to that, Myles shall remain responsible for making the payments on the line of credit (renovation costs) as well as paying for utilities, property taxes, homeowners insurance, house repair, maintenance, and yard care for the family home. [ 87 ] Myles shall also be responsible for 84.6 percent of the cost of tuition, books, student fees and lab fees for the two eligible children attending university; 84.6 percent of off-campus housing costs while they live away from home to do so; and 84.6 percent of the cost required for them to travel home.

Loren shall be responsible for 15.4 percent of those costs. I will explain, in the next

section of this judgment, how I arrived at those percentages. 6. Legal principles governing the calculation of spousal support [ 88 ] The primary purpose of interim spousal support is the fair and equitable allocation of family income. The court’s focus, when determining quantum, is on the parties’ respective needs and ability to pay ( Merrifield at para 77 ; Wongstedt at paras 23 and 25 ; Potzus at para 133 ).

When calculating the quantum of interim spousal support in a case involving a high-income family, a Chambers judge has a considerable degree of discretionary room to manoeuvre, with the ultimate goal being to maintain the “financial status quo” until a more precise determination can be made at trial on the basis of a full evidentiary picture ( Potzus at paras 126–127 ).

In that respect, in Potzus , Wilkinson J. explained that the ranges determined by the formulae contained in the SSAG are a useful reference point in determining the appropriate amount of interim spousal support in a high-income family, but they are not determinative.

And, where there is a substantial gap between the SSAG “ceiling” and the payor spouse’s income, the SSAG ranges may carry less weight: [128] The Revised Guide summarizes the principles that have emerged from case law addressing incomes above the $350,000 ceiling: • The formulas for amount are no longer presumptive once the payor’s income exceeds the “ceiling”. • The ceiling is not an absolute or hard “cap” , as spousal support can and usually does increase for payor incomes above $350,000. • The formulas are not to be applied automatically above the ceiling, although the formulas may provide an appropriate method of determining spousal support in an individual case, depending on the facts. • Above the ceiling, spousal support cases require an individualized, fact-specific analysis .

It is not an error, however, to fix an amount in the SSAG range … Evidence and argument are required. • Where the payor’s income is not too far above the ceiling , the formula ranges will often be used to determine the amount of spousal support, with outcomes falling in the low-to-mid range for amount. How far is “not too far above” is still not clear. Somewhere between $500,000 and $700,000, it seems.

• Once the payor’s income is “far” above the ceiling , then the amount of support ordered will usually be below the low end of the SSAG range, but SSAG ranges are still calculated and sometimes the outcome will fall within the SSAG range. … [131]

Section 15.2(4) of the Divorce Act mandates that in making a spousal support order “the court shall take into consideration the condition, means, needs and other circumstances of each spouse … .” Appropriately, in a situation of pecuniary advantage, the issue of need is well capable of being measured against the parties’ marital standard of living. “Need” can arise from a decline in standard of living as compared to the marital standard.

The Supreme Court of Canada has adopted a broad and expansive approach in ascertaining means and ability to pay spousal support, one that includes consideration of “all pecuniary resources, capital assets, income from employment or earning capacity, and other sources from which the person receives gains or benefits”: Leskun v Leskun , 2006 SCC 25 at para 29 , [2006] 1 SCR 920. [132] Accordingly, where a court has before it an individual of unquestionably-sound financial means who provided his intact family with an affluent, free-spending lifestyle, there is a considerable degree of latitude afforded to a Chambers judge on interim motion when it comes to an assessment of means, needs, and ability to pay spousal support.

Likewise, there is a significant margin of deference to a Chambers judge’s decision to adopt or depart from the SSAG ranges in such circumstances. (Emphasis in original) 7. The Chambers judge erred in the calculation of spousal support [ 89 ] In both the Chambers Decision and the Corrigendum , the Chambers judge appears to have calculated the amount of spousal support payable to Loren by simply adopting numbers that had been generated by Childview 2019.2.0, based on the income determinations he had made and using the “With Child Support” formula.

In that respect, he settled on the number that represented the low end of the range suggested by the SSAG. [ 90 ] While the SSAG can be a useful tool in calculating the quantum of spousal support payable and a Chambers judge’s exercise of discretion when making an interim order of that nature is entitled to considerable deference on appeal, the door to appellate intervention is opened where the exe

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