Law Blog

Payor income hike doesn't always increase support

Posted in Gary Joseph Posted on September 23, 2016

Marriage is, among other things, an economic partnership. In Canada, the relevant legislation has evolved to ensure that the economic benefits of this partnership are divided fairly upon its breakdown.

What sort of division is fair depends on the nature of the partnership being divided. Not all marriages involve complete economic integration. In some marriages, both spouses pursue their economic interests independently. In others, one spouse sacrifices their own career to enable the other to pursue theirs.

Depending on how they pursue their joint economic interests, a spouse may or may not be entitled to share in increases in their former spouse’s income after separation. Whether they will be so entitled is dependent on the facts of each particular case. No spouse is automatically entitled to increased spousal support simply because the payor spouse’s income increases after separation, although many family law practitioners believe otherwise. The courts have recognized three conceptual grounds for entitlement to spousal support: (1) compensatory; (2) non-compensatory; and (3) contractual (see Bracklow v. Bracklow [1999] 1 S.C.R. 420).

Whether a spouse is entitled to share in increases in their former spouse’s income after separation largely depends on the basis of their entitlement to spousal support. A non-compensatory spousal support award is meant to ensure that the recipient spouse enjoys a lifestyle similar to that which they enjoyed during the marriage (see Fisher v. Fisher 2008 ONCA 11).

Post-separation increases in the payor spouse’s income are irrelevant to that purpose. As a result, they will not generally be shared with the recipient spouse. A compensatory spousal support award is meant to compensate the recipient spouse for the sacrifices and contributions they made during the marriage. In accordance with that purpose, a recipient of compensatory spousal support may be entitled to share in post-separation increases in the payor spouse’s income. As a result, a spouse’s entitlement to post-separation increases in their former spouse’s income depends primarily on whether the payor’s post-separation successes are traceable to the sacrifices and contributions made by the recipient spouse during the marriage.

In Thompson v. Thompson 2013 ONSC 5500, Justice Deborah Chappel outlines the relevant considerations when determining a payee spouse’s entitlement to post-separation increases in the payor spouse’s income. Justice Chappel’s approach has been widely accepted and was recently endorsed by the Ontario Court of Appeal in Hersey v. Hersey 2016 ONCA 494. According to Justice Chappel, the recipient spouse is more likely to share in post-separation increases in the payor’s income when their relationship was long, their financial affairs were completely integrated and the recipient spouse made sacrifices and contributions for the sake of the family which led to longstanding and significant benefits to the payor spouse (see Farnum v. Farnum 2010 ONCJ 378). When the spouses divided their responsibilities in a manner which suggests they made a joint investment in one career, the recipient spouse is likely to be entitled to share in the proceeds of that investment (see Hartshorne v. Hartshorne 2009 BCSC 698, reversed in part in Sawchuk v. Sawchuk 2010 ABQB 5, and Judd v. Judd 2010 BCSC 153). A recipient may have invested in the payor’s career in a multitude of ways: they may have funded the payor’s education or training; they may have contributed their time or money directly to the payor’s

When the spouses divided their responsibilities in a manner which suggests they made a joint investment in one career, the recipient spouse is likely to be entitled to share in the proceeds of that investment (see Hartshorne v. Hartshorne 2009 BCSC 698, reversed in part in Sawchuk v. Sawchuk 2010 ABQB 5, and Judd v. Judd 2010 BCSC 153). A recipient may have invested in the payor’s career in a multitude of ways: they may have funded the payor’s education or training; they may have contributed their time or money directly to the payor’s business; or they may have set aside their own career ambitions in order to care for their children and enable the payor to achieve greater career success. However, caring for the children will likely be insufficient unless the recipient spouse can demonstrate that they sacrificed their own opportunities to do so.

If the payor’s income increases as a result of post-separation developments which are unrelated to the career path they followed during the marriage, the recipient spouse is unlikely to share in that increase. For example, a payee spouse is unlikely to share in the benefits of a successful post-separation career change or increases linked to the payor’s own luck or connections. Unsurprisingly, it will be more difficult to link a post-separation increase in income to the recipient spouse’s contributions when a long time has elapsed since the marriage (Kohan v. Kohan 2016 ABCA 125).

Again, no spouse is automatically entitled to increased spousal support simply because the payor’s income has increased. In order to succeed with such a claim, the recipient needs to demonstrate that the increases in the payor’s income are linked to the contributions and sacrifices they made during the marriage. Whether those sacrifices are sufficient to ground a claim for greater spousal support will depend on the strength of the connection between their sacrifices and the payor’s post-separation successes

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