Section 12 of the Federal Child Support Guidelines expressly provides that the court may require the amount payable under a child support order to be paid or secured, or paid and secured, in the manner specified in the order.159
An order to secure support, of itself, is not an order to make payments and secure those payments. It is an order to secure and no more. The sole obligation arising under such an order is to provide the security; having done that, there is no further liability. The parent who is only ordered to secure support does not assume a personal obligation to pay and never becomes a debtor in respect of payments in default. A parent in whose favour an order to secure support is made takes the benefit of the security and must look to it alone; if it ceases to yield the expected income, that parent cannot call upon the other to make good the deficiency.160The mutual exclusivity of orders to pay and orders to secure support, which was endorsed by the majority judgment of the Supreme Court of Canada in Nash v. Nash,161 no longer prevails under section 12 of the Federal Child Support Guidelines. Pursuant to that section, the court may require that the amount payable under a child support order "be paid or secured, or paid and secured" in the manner specified in the order.162In view of the aforementioned inherent limitations of an order to secure simpliciter, courts are well advised to grant a combined order to pay and secure support where the obligor has income but some additional security is appropriate to ensure due discharge of the court-ordered obligations. Where such an order is granted, realization of the security would not preclude further recourse on the personal obligation to meet any deficiency or ongoing liability. An order to secure may be appropriate when the obligor may be unable to make periodic payments, when the obligor may leave the country with the assets or waste or conceal them, or when the obligee requires some assurance that there will be funds available.163
A periodic or lump sum child support order may be secured against real or personal property,164including the matrimonial home,165or the proceeds of sale thereof,166the obligor’s statutory property entitlement,167or against an obligor’s mutual funds,168personal injuries monetary settlement or a portion thereof,169Canada Savings Bonds,170corporate
shareholdings,171RRSPs172or retirement pension.173An important distinction is to be drawn between an order for lump sum child support and an order requiring that a lump sum be set aside as security for the payment of child support.174An order to secure periodic child support payments may be deemed appropriate where the obligor has a history of dissipating assets; where the obligor is likely to leave the jurisdiction and become an absconding debtor; where the obligor has previously refused to honour a support obligation; or where the obligor has a poor employment history or threatens to leave his employment.175An order for periodic child support may be secured against the obligor’s entitlement to the remainder of his share of matrimonial property, if the obligor is intentionally underemployed. Where such an order is made, the obligor may be relieved from making periodic child support payments based on his imputed annual income until the lump sum property entitlement has been exhausted.176An application for lump sum support to be secured against the obligor’s interest in the matrimonial home should be denied where there is no evidentiary basis pointing to prospective default in the payment of periodic child support.177A court may conclude that it is in the best interests of the children that the obligor provide security for the child support obligation in the form of a postponement of the sale of the matrimonial home which may be achieved by an exclusive possession order in favour of the custodial parent for a fixed period of time, at the end of which the home will be sold and the obligor’s share of the proceeds of sale will first be applied to any arrears of child support then outstanding.178A conditional prohibition has been imposed on an obligor’s employer to preclude the pay out of a lump sum pension entitlement, unless the obligor secures gainful employment and can thus discharge the monthly child support obligation.179It is submitted, however, that a court has no jurisdiction to impose legal obligations on a non-party to the litigation. In order to ensure timely payment of child support, the court may order the obligor to provide a designated lump sum in liquid security180or in an interest bearing trust account181from which periodic child support payments shall be made. Money previously paid into court may be retained as security, pending resolution of the issue of child support.182The power to make or refuse an order to secure support is within the discretion of the court.183In exercising its discretion, the court must have due regard to the capital and secured income of the spouse against whom the order to secure is sought.184Although the courts may decline to grant an order to secure against property that has no income yielding capacity, an obligor may be ordered to execute a mortgage against the matrimonial home
in favour of the obligee.185Security for future payments may also be provided by a judicial direction that the obligor execute an appropriate irrevocable declaration under a life insurance policy An obligor may be ordered to provide security for periodic support payments by irrevocably designating the obligee as the beneficiary under a life insurance policy or supplementary death benefit plan,186but such an order may be inappropriate when the obligee’s economic circumstances are not extreme and the obligor has a relatively modest estate and other family dependants to support.187A court may direct that the child support order shall constitute a first charge on the obligor’s estate.188A court may lack jurisdiction under the Divorce Act to order an obligor to purchase a life insurance policy to secure child support payments, where no policy existed at the date when relief was sought, but such an order may be granted under section 34(1)(k) of the Ontario Family Law Act.189A mother, who seeks to obtain insurance on the father’s life to secure the payment of child support arrears and the costs relating thereto, may obtain a court order to compel the father to complete a questionnaire and undergo whatever medical testing is required.190Where an obligor is ordered to make an irrevocable designation under a life insurance policy in order to secure child support payments, the court may require the obligor to direct her insurer to provide the designated party with annual proof of coverage and notice of any change in or cancellation of the policy immediately upon its occurrence.191Where both periodic child support and periodic spousal support are to be secured against an obligor’s life insurance, the amounts involved may need to be segregated to reflect differences existing between the amount and duration of the orders.192Courts may order that periodic child support payments be secured by insurance to cover the eventuality of a termination or change in the obligor’s employment.193It has been concluded that the meaning of the word "secure" is sufficiently broad to permit a court to order that support be deducted directly from the obligor’s wages.194A court may order that all child support arrears and interest payable thereon shall be secured against the defaulter’s retirement account and may issue an order restraining the obligor from disposing of or encumbrancing the account until the debt is fully discharged.
The court may further suggest that the Family Responsibility Office seize the retirement account in addition to garnishing the defaulter’s pay, having regard to the principle that child support obligations take priority over saving for retirement.195A court may decline to order security for child support where prior arrears accrued during bankruptcy and there is no apparent need to secure the obligation.196Where arrears of support have accrued notwithstanding the filing of the child support order in the Ontario Family Responsibility Office, because statutory provisions impose a maximum on the amount deductible by the income source, an order to secure child support payments against the obligor’s interest in the matrimonial home may be deemed appropriate, and where special needs children are involved, the court may further direct both parents to maintain their existing life insurance policies for the benefit of the children.197An order for periodic child support payments may be secured against the obligor’s personal and corporate property interests pursuant to section 12 of the...