By Mark Demas
The Supreme Court of Canada (SCC) is this country’s foremost court of appeal and the final word in resolving legal issues of public importance. We look to the nine Supreme Court justices to interpret the meanings of our laws, set legal precedents and provide direction. Such is the case in Colucci v. Colucci, 2021 SCC 24, a June 2021 SCC ruling that has been widely acknowledged in family law as providing clarification and a welcome framework for establishing retroactive decreases in child support.
The unanimous decision upheld an Ontario Court of Appeal decision that found a father owed his former wife $170,000 in retroactive child support payments. In doing so, the SCC laid out a structure for judges across the country to follow in the “very common” situations where a parent requests a retroactive decrease in the ongoing child support they are paying to reflect a past reduction in income.
Facts of the case
Court was told a couple was married in 1983 and divorced 13 years later. The mother was granted sole custody of their two daughters and the father was required to pay child support of $115 per child, per week.
In 1998, the father applied to reduce his child support obligations but provided no financial disclosure to support his request. He and his ex-wife reached no agreement at that time.
The man’s child support obligations ended in 2012. However, from 1998 to 2016, he made no voluntary child support payments with only limited amounts collected through enforcement by Ontario’s Family Responsibility Office. During this time, the father’s whereabouts were unknown and he was absent from his daughters’ lives.
In 2016 the man applied Ontario Superior Court to retroactively reduce his support obligations and rescind approximately $170,000 in arrears, under s.17 of the Divorce Act.
Court rules in the father’s favour
Superior court ruled that the variation was warranted in order to bring the father’s support obligations in line with Federal Child Support Guidelines and to reflect decreased income during the period in question. His accrued balance was reduced to $41,642.
However, The Ontario Court of Appeal later restored the balance owed, noting the failure to provide substantive information.
Writing on behalf of the majority, Justice L.B. Roberts stated the man “has not discharged his onus to explain his significant failure to make support payments and his extraordinary delay in proceeding with his application to vary, nor has he produced reliable evidence of his inability to pay while arrears were accumulating, particularly during the periods when he absconded without a trace …”
Roberts added that the father’s “own blameworthy conduct” contributed to any alleged hardship and left a “substantial financial burden on his family’s shoulders.”
Supreme Court appeal
The man appealed to the Supreme Court, which viewed the case as an “opportunity to establish a framework for courts to follow” when a parent attempts to retroactively decrease child support under s.17.
The SCC stated that courts across the country “have and need wide discretion to vary child support orders” in order to ensure the amount of support being paid is correct.
The Court ruled three interests must be balanced to achieve a fair result:
- the child’s interest in receiving the appropriate amount of support;
- the interest of the parties and the child in certainty and predictability; and
- the need for flexibility to ensure a just result if the payor’s income fluctuates.
Support is based on income
The amount of child support is based on the income of the parent paying and that income can change over time, the SCC noted. As a result, applications to retroactively vary support are not uncommon. The Court stated that in a perfect world, parents working together in the best interests of their children would provide “full and accurate income information every year and recalculate the proper amount of support owing.” However, when that does not happen, they need the courts to intervene.
Supreme Court Justice Sheilah Martin cited the long-established principle of child support law in Canada that “parents have a financial obligation to their children arising at birth and continuing after separation.”
Section 17 of the Divorce Act provides that a court “may make an order varying, rescinding or suspending, retroactively or prospectively, a support order or any provision of one.”
Justice Martin noted the section confers substantial discretion on a judge in these matters “because wide judicial discretion is necessary to respond to the multiplicity of factual situations produced by human behaviour.”
Must show proof
In their ruling, the SCC confirmed it is the duty of the person seeking a retroactive decrease to demonstrate a clear change in their financial circumstances.
“The child support system depends upon adequate, accurate and timely financial disclosure,” Justice Martin wrote. “Disclosure is the linchpin on which fair support depends and the relevant legal tests must encourage the timely provision of necessary information.
“To the extent that Mr. Colucci relies on current inability to pay in this case, his failure to adduce adequate evidence of his financial circumstances would be fatal to any application to rescind arrears,” she added. “As stated by the Court of Appeal, Mr. Colucci has not provided complete and accurate disclosure of his income and assets and continued to misrepresent his financial circumstances in the course of the proceedings.”
Not an automatic entitlement
The SCC heard the father had tried to seek a retroactive decrease of child support payments back to 1997, claiming he was automatically entitled to it. However, he never notified the mother about his decreased income at the time.
The SCC stated that ‘it is not enough for a payor in Mr. Colucci’s shoes to advise the recipient that their income has fallen without taking any further steps.”
“Following Ms. Colucci’s refusal to vary support in 1998, Mr. Colucci ‘produced no proof of his changed financial circumstances, nor, after his initial request for a reduction in 1998, did he instigate any further negotiations, mediation or court proceedings’ (C.A. reasons, at para. 34),” Justice Martin wrote. “Rather, he cut off communication and did nothing until commencing this proceeding in 2016. Since Mr. Colucci did not provide reasonable proof to allow the recipient to meaningfully assess the situation, his request fell short of effective notice.”
The Court stated that even if a parent has established a past decrease in income, that person is not automatically entitled to a retroactive decrease in support. It would be up to a court to make a decision after analyzing the particular case.
“Mr. Colucci also made few, if any, voluntary payments during that time and showed no willingness to support the children, who suffered hardship as a result of his failure to fulfill his obligations,” Justice Martin stated. “His conduct shows bad faith efforts to evade the enforcement of a court order.”
Establishing a framework
In the end, the SCC found “this case provides an example of the kind of inadequate disclosure” that would justify rejecting the father’s application. Failing to do so would “incentivize payors to provide inadequate disclosure in the hopes that the court will either accept their assertions or impute income that is lower than the income actually earned.” Simply stated, “accurate and timely financial disclosure” is a must.
The Court recognized that income can fluctuate and payors need flexibility when it comes to child support. However, the SCC also made it clear that the protection of child support recipients is paramount, signalling that the cancellation of child support debt would only happen in exceptional cases and as a last resort.
We are here to guide you
Based on the above, if you are the payor of child support and you experience a reduction to your income, it is critically important that you notify the recipient in a timely fashion and provide sufficient financial information to evidence the reduction. A failure to do so may well result in your being precluded from later asking the court for a retroactive reduction to child support. There can be many concerns and misconceptions when it comes to child support obligations and the right to vary orders. The team at Demas Schaefer Family Lawyers is trained and experienced in child support and retroactive child support litigation and is here to help. Contact us today to schedule your free consultation.