MAINTENANCE AND SUPPORT - Child support - Calculation or attribution of income - Financial disclosure - Considerations - Retroactive awards

Appeal by the father from orders granting the mother retroactive child support for 2012 to 2014 and setting the parties’ guideline income for 2015. The parties, who had one child, divorced in 2011. Since July 2015, they had shared parenting. The father’s income was from a company that was in the business of renting construction and oil field equipment. He was the sole shareholder and director. The father disclosed his personal income tax returns, but did not disclose financial information about his corporation. His guideline income and proportionate share of s. 7 expenses was based on his line 150 income from his personal tax returns. In 2015, the mother consulted a lawyer who advised her that the father’s income for support purposes might be higher than reflected in his tax returns. As a result, she obtained the corporate financial statements and had an expert report prepared. The expert made adjustments to the father’s income for personal expenses paid by the corporation. One adjustment was a portion of the salary the corporation paid to the father’s new wife, which the expert concluded was a non-arms’ length expense. As a result of the report, the mother applied for retroactive child support. The father cross-applied for a recalculation of child support and retroactive credit for overpayment of child support. The chambers judge found that the father had failed to disclose financial information as required by the divorce judgment, and that the mother had not waived her entitlement to receive the information. He further concluded that the father’s line 150 income did not fairly reflect the funds available for child support and it was appropriate to add part of the pre-tax income of the corporation. He concluded that the expert’s estimates were reasonable and he selected the mid-range of income adjustment in each of 2012, 2013 and 2014 and added that income to the father’s line 150 income. He used that as a basis to award retroactive child support for 2012 to 2014 in the total amount of $42,500. For 2015, he added one-half of the father’s new wife’s salary to the father’s line 150 income and imputed his income at $165,000. The father appealed, arguing that the chambers judge erred in refusing to admit his supplementary affidavit and in determining his income for the purposes of the Guidelines. He submitted the chambers judge should have found that the mother waived her right to retroactive child support.

HELD: Appeal dismissed. The orders were reasonable. There was no error in the judge’s refusal to admit the father’s supplementary affidavit. The father did not apply to the judge to admit the supplementary affidavit and much of the information that supported the father’s submissions on the determination of his income was contained in his earlier affidavit. The chambers judge’s use of the mid-range estimate of personal benefits as set out in the expert report was reasonable and there was no error in including the grossed-up dividends or one-half of the father’s new wife’s income in determining the father’s income for support purposes. The mother did not waive her entitlement to retroactive support and she acted promptly when she became aware that the corporation’s income could be used to vary the father’s income for support purposes. There was nothing to suggest that the chambers judge failed to consider the relevant factors in determining the three-year period for retroactive support, particularly given the father’s lack of disclosure of the corporation’s financial information. There was no basis to set aside the judge’s discretionary order that the parties share the cost of the expert report.

Bohn v. Bohn, [2016] A.J. No. 1321, Alberta Court of Appeal, R.L. Berger, P.A. Rowbotham and B.L. Veldhuis JJ.A., December 21, 2016. Digest No. 3636-008