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MAINTENANCE AND SUPPORT - Child support - Calculation or attribution of income - Financial disclosure - Retroactive awards - Quantum - Payor’s annual income - Veterans’ pensions and allowances

Tuesday, April 10, 2018 @ 8:50 AM  

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Application by the mother for child support based on income imputed to the father. The parties had 12-year-old and nine-year-old children of whom they shared custody following separation. In 2016, the mother, a Corporal in the Canadian Armed Forces (CAF), was posted to Petawawa and obtained an order permitting her to move with the children. The mother obtained an interim child support order without prejudice to her ability to seek a different amount on imputed income. The mother learned at that time that the father had received payments under s. 45 of the Canadian Forces Members and Veterans Re-establishment Compensation Act (New Veterans Charter). The father had been medically discharged from the CAF and diagnosed with Post Traumatic Stress Disorder (PTSD). The father received $343,459 in lump sum payments for his PTSD and knee injury from between 2013 and 2017. Disability awards for veterans were previously made under s. 21 of the Pension Act, and there was case law that found the monthly benefit was not income for the purpose of an insurance contract, but income for support purposes. The mother argued the lump sum awards should be included in the father’s income for support purposes when received or spread out over a 10-year period. The father argued the disability awards were personal to him and did not constitute income.

HELD: Application allowed in part. The parties agreed that the attendance allowance received by the father for necessary help with services at home was not part of his income. The father’s income was adjusted to disallow a deduction for business losses, as he opened a martial arts studio as a source of personal satisfaction but did not intend to turn a profit. The father sustained significant injuries as a result of his military service and received a disability award as compensation. The New Veterans Charter changed the manner in which assistance was provided; instead of a monthly pension, there were earnings loss payments and disability awards. The New Veterans Act attempted to make a clear distinction between income replacement monies and monies paid for pain and suffering and loss of amenities of life. Unlike the basic portion under s. 21 of the Pension Act, the father would not receive further amounts, unless there was a legislative top up, his disability increased, or he developed another type of disability related to his service. It would be unjust to include the disability award in the father’s income when received or spread them over 10 years, but the father received a substantial sum of money that increased his means, and the children should benefit from it. The lump sum amount was intended to compensate the father over his lifetime; therefore, for support purposes, the benefit to the father was allocated over an average lifespan and grossed up to reflect its tax-free status. On that basis, the father’s 2015 income was $75,918 and he was to pay $1,117 monthly support from September 2016 to May 2017. The father’s 2016 income was $95,536 and he was to pay $1,369 monthly support from June 2017 to May 2018.

Hewitt v. Rogers, [2018] O.J. No. 1056, Ontario Superior Court of Justice, A.C. Trousdale J., February 28, 2018. Digest No. TLD-April92018004