Almost 30 years have come and gone since I started practicing family law, and yet I am still amazed at how many people are in the dark about their obligation to pay child support when their relationship ends. At first, it was almost exclusively men, but over the last 5 to 10 years, the number of women paying child support is steadily increasing. I had a prospective female client tell me that she didn’t think she had to pay child support because she was the mother, despite the fact that she was not the custodial parent (as the term was at the time).
Nevertheless, there is another group of people who structure their lives in such a way as to make it seem to everyone that they have no income, so when the inevitable call for paying child support comes, they usually respond with “you can’t get blood from a stone.” Many (but not all) of them tend to laugh or act smugly, thinking they’ve pulled the wool over the support recipient’s eyes. But fear not! There is hope! The law has come up with ways to try and find the money if it’s there to be found, or alternatively, to treat the support payor as if they have the money but refuse to disclose it.
This paper will deal with ways of getting the child support payor to disclose their income and, when that fails, how to impute income against them. There is plenty of case law on the subject, so this will not be a comprehensive blog by any means, but at least a first step towards practical tips and tricks to get the child support paid.
Step #1 – Request Disclosure
Let’s presume you have started a case to get child support paid, or you are looking at changing an existing order or agreement that requires the other side to pay you child support. The premise moving forward is the same. The first step is to make a formal request of the other side to tell you what they are making now and have made over the last three years. It is as simple as sending the other side a letter, an email, a text, or demand letter from your lawyer. In the letters, you should be asking the other side to produce the following information (at a minimum):
- A copy of the support payor’s personal income tax returns, and all notices of assessment, for the taxation years 2020, 2021 and 2022;
- If they run a business, a copy of the tax returns for the business, with all related schedules, and all notices of assessments, for the taxation years 2020, 2021 and 2022;
- A copy of their last three paystubs from thier employer;
- A “Form 13” financial statement (as prescribed by the Family Law Rules).
Do not accept a payor’s word for it as to what they make. Demand the records as generated by a third party, e.g. Notices of Assessment (NOAs) and/or Income Tax Returns (ITRs) from Canada Revenue Agency (CRA), pay stubs from an employer, receipts from CPP, EI, OW, ODSP, WSIB, etc. I also add a line to my demand letters that says, depending upon what this information discloses, I may make a request for further information.
At this point, the payor often asks me what authority I have to demand this information. If it’s out of court, I remind them of the requirements under either Divorce Act or the Family Law Act to try and settle cases outside of court. If this matter is proceeding to court, the court will issue a Form 8.0.1 Automatic Order, which in essence tells the parties that they must exchange financial information that is already required per Rule 13. If it’s the latter, the order is much more detailed as to what needs to be provided.
Step #2 – Non-Compliance with Disclosure – Baby Steps
If the request in or out of court for the financial information does not bear any fruit, then you have a couple of options. Let’s first presume there is no urgency to the matter, or there is no imminent threat that the payor is going to liquidate their assets and income to avoid support payment (rare, but it does happen).
If the matter started out of court, it will now likely proceed to being in court, and now with the threat of costs. If the payor does not produce their basic financial documents as they are required to do by law, the family court staff will not allow the payor to file their paperwork to defend the court matter. That usually resolves most of the disputes, as people will want to have their say in court.
Sometimes, however, the payor will allege, whether rightly or wrongly, that they have not done their taxes in many years, and thus, they cannot produce them at this time. The courts are somewhat understanding and will give the payor a very short period of time to file their income tax returns and order them to produce a copy of the submitted returns, along with all attachments, immediately to you, and also order them to produce the notices of assessment once received from the CRA (usually a few months down the road). That, too, usually resolves many disputes.
In other cases, the payor somehow makes it to the first judicial court date and, somehow, still has not produced their financial documentation as required. At that point, the recipient can and will get an order for production by the payor in a fixed amount of time (sooner, rather than later), and usually are ordered to pay the recipient’s legal costs for not having produced them to date. The payor is not usually happy about it, but they have to bear the blame for not filing their taxes on time, as required under Canadian law (whether someone does not have to file taxes is a whole other blog and well beyond the scope of this one).
Step #3 – Non-Compliance with Disclosure – When a Payor Does Not Play Nice in the Sandbox
When the nice and simple ways of requiring a payor to produce their financial information does not work, then regrettably, other methods have to be considered. I say “regrettably” because the exercise of producing disclosure should be straightforward, and it is waste of time, money and court/judicial resources to require people to produce information that they know must be produced. This usually happens when the payor’s financial information reveals that they may have other non-disclosed sources of income, or the payor’s lifestyle would suggest the same conclusion, for example, the average person in receipt of OW or ODSP benefits for a period of years does not drive a late model luxury car or take annual lavish vacations to the Caribbean.
Depending upon the payor’s purported circumstances, and the degree to which the support recipient believes the payor is not being forthright in their financial disclosure, the support recipient can ask for certain orders to allow them to investigate the matter in more detail. This includes:
- A request for information/production of documents. This is where the recipient sends the payor a list of what information they are seeking from the payor. Please make sure that what is being sought must be connected to what is needed to be produced to assess the person’s income or establish their asset/debt levels; and/or,
- A statement of agreed facts. This is usually for the inevitable motion or trial, to reduce what is in dispute; and/or,
- A motion to compel the disclosure to be produced by a certain date. This is fairly self-explanatory, and it lets the court know what steps have been taken to get the other side to complete their financial disclosure; and/or,
- A motion for questioning. This is where the recipient’s lawyer will ask the court for permission to have the payor attend an examiner’s office and, while under oath/affirmation, answer relevant questions and provide supporting documents about their financial situation which have not been produced to date.
As an integral part of those requests that require a judge to intervene and make a determination, it is important to remind the payor that you will be seeking costs on behalf of the support recipient, as these steps could have been avoided had they complied earlier. In seeking costs, please also ensure that you have made proper offers to settle the matter (in accordance with the Family Law Rules), and reference same when asked by the judge to address the issue of costs, including having your bill of costs ready to present to the judge.
Step #4 – If You Won’t Tell Me What You Make, I Will Tell The Judge What You Make
If a payor continues to “dig a hole in the yard” to bury their head, there is a way to deal with this tactic. The Child Support Guidelines provides the mechanism for when a support recipient can ask the court to “impute income” against a support payor. The case law that evolved thereafter applies equally to spousal support claims as well. It is simple three-part test:
- Is the party intentionally underemployed or unemployed?
- If so, is the intentional underemployment or unemployment required by virtue of their reasonable educational needs?
- If not, what income is appropriately imputed?
As the saying goes, the devil is in the detail, but if a recipient can establish each part of the test, the courts will gladly impute an income against the support payor. However, heed a warning: if you are going to impute an income level, be reasonable and realistic. If the payor has never worked beyond minimum wage or general labourer jobs, don’t ask a judge to impute an annual income of $100,000.00 against the person. A judge will be disinclined to impute income altogether, or possibly impute a lower than realistic amount. If you have verbal evidence (he always bragged he made $100,000 per year), documentary evidence (a copy of loan agreement where he told a bank he made $100,000 per year), or even third-party evidence (government website to suggest the average plumber with 3-years’ experience in the GTA makes $100,000) to support your case for the level of imputation, then use what you have available to you.
Step #5 – Intentional Non-Compliance with Disclosure – Motion for Contempt of Court
Once there is an order from a judge that requires the support payor to produce certain information by a certain date, hopefully they understand the seriousness of the matter. It is no longer a polite request. A judge has determined that this information must be produced, and there is a deadline by which to produce it.
The intentional failure of a support payor to produce their required financial disclosure can be met by a couple of ways. One of the more common ways of addressing this is for the recipient to bring a motion to have the support payor found in contempt of court. To have someone found in contempt of court is “quasi-criminal” which means that the standard of proof is that the payor knew they had obligation under court order to produce the disclosure but intentionally did not do so, and they had no lawful excuse not to do so.
Practically speaking, a finding of contempt is often a high hurdle to overcome, although it seems like an easy case on paper. Judges expect clear and unimpeachable evidence that the elements of the contempt are met. Getting into someone’s mind to prove they had the intent to not produce the document is generally a stumbling block, but it is not insurmountable. As is often the case, support payors are their own worst enemies, as they often commit their specific intent to not comply with the order in an impromptu email, text or other such correspondence.
If a judge finds a person in contempt of a court order, there are a variety of orders a judge can make, including significant costs, or even costs accruing on a daily basis until the disclosure is produced. In the most extreme cases, a judge court order a person to serve time in jail for their contempt, but that is highly unlikely in most cases. Much like in criminal court, a family court judge will use a measured “sentencing” model and impart a punishment that meets the specific circumstances of the case.
Step #6 – Complete Non-Compliance with Disclosure – Striking Pleadings
One of the options that a judge has in contempt proceedings is to strike the support payor’s pleadings. But you do not need a contempt motion to seek this relief. A support recipient can bring a motion to strike, either in lieu of a contempt proceeding or following such a proceeding. Sometimes, recipients want to jump to this step right away, but given that it is basically the nuclear option, it is the last step in the process.
If all efforts to compel the payor to produce their documentation have failed, then definitely bring this motion. Make sure you set out in your motion all the steps that have been taken and haven’t worked, so that the judge does not send you back to try something that has been tried and did not work. Take the guess work out of it for the judge so they are left with no other choice but to strike the pleadings. Judges will be loath to grant this relief unless you show them nothing else has worked. As the relief sought is so final, it must be the last option. There’s no guarantee that the courts will grant you this order, but certainly try. And don’t forget to ask for costs, too.
By no means have I listed all the ways to get money from a payor who is unwilling to part with either the information to show what they make or the money itself (once ordered). There are other methods that are tailored for certain payors, and in such cases, you should seek the advice of an experienced lawyer to determine what the best method is for the specific situation.
Once again, as I advise my clients, please be practical, and do not spend good money after bad. At some point in the process, you may have to accept that, at this moment in time, you may not be able to get the support you are owed from the support payor. But much like Canadian weather, be prepared for circumstances that can change quite quickly. Ask for/demand the payor’s disclosure on an annual basis, and make sure you put it in writing. Let them know they may have won a small battle, but pursuing support is a marathon – not a sprint – and you’re just getting started.
Remember, every case is unique, just like you are. If you are facing real legal problems, you need the right legal solutions. Please contact Runco Law at 289-799-3080 or email me at firstname.lastname@example.org.