C. Sharing of Expenses as Guiding Principle; Effect of Spousal Support

• Author: Julien D. Payne - Marilyn A. Payne
• Pages: 257-261

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In determining the amount of an expense or the contribution thereto under section 7 of the Federal Child Support Guidelines, the guiding principle is that the spouses or former spouses should share the expense in proportion to their respective incomes after deducting any contribution from the child or other liable parent.¹⁰¹Having regard to their age and financial ability, a court may require children to make a financial contribution to expenses relating to their extracurricular activities, but not to their health-related expenses where their father has health insurance coverage.¹⁰²To respond thoroughly to a request for a contribution to special or extraordinary expenses, the court and the responding spouse require information about the circumstances of the child. In the event that the children do not cooperate in providing the information, they are at risk of not having their eligibility for section 7 expenses established. The disclosure of a child’s income tax return and notice of assessment is within the range of documents that should be available to the court and the parties.¹⁰³Section 7(2) of the Guidelines establishes a guiding principle, rather than a fixed rule or requirement, with respect to the sharing of special or extraordinary expenses that fall within the ambit of section 7(1) of the Guidelines.¹⁰⁴There is, therefore, some judicial flexibility and discretion in the allocation of such expenses,¹⁰⁵or in their denial.¹⁰⁶The court may depart from the general principle of an income-based pro rata sharing of a child’s expenses where the parents have agreed to equally share the expenses¹⁰⁷or where there is a substan-

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tial disparity between the parental incomes,¹⁰⁸as for example, where one parent’s income is barely sufficient to provide for his or her own needs and the other parent has ample ability to shoulder the expense.¹⁰⁹Past and present family support obligations may preclude a non-custodial parent from making a proportionate, or any, contribution to otherwise reasonable expenses falling within the meaning of section 7 of the Guidelines.¹¹⁰Courts may deviate from a proportionate sharing of special or extraordinary expenses under section 7(2) of the Guidelines in cases of unequal time-sharing that satisfy the 60:40 percent rule under section 9 of the Guidelines¹¹¹or where one parent assumes the responsibility for transportation costs associated with access.¹¹²Section 7(2) of the Guidelines does not mandate a rigid formula which automatically relieves separated and divorced parents from contributing to the cost of their children’s post-secondary education when the children are able to obtain student loans. Each case must be considered in the context of the financial circumstances of all three potential contributors (the two parents and the child), having regard to the factors in section 7(1) of the Guidelines, and in the context of the objectives of the Guidelines.¹¹³

Several options are available to the court in light of the phrase "the contribution, if any, of the child" in section 7(2) of the Guidelines. If the child has no actual or potential sources of income, no deduction will be made before apportioning the allowed section 7 expenses between the parents. If the child has income, the court may decline to order the child to make a contribution to the expenses or may treat only part of the income as a contribution to be made by the child.¹¹⁴Income may be imputed to an adult child on the basis of a presumed earning capacity during the summer months for the purpose of determining the child’s proper contribution towards his post-secondary education expenses. However, a court should not deviate from the guiding principle of apportioning such expenses according to the respective parental incomes after due account is taken of the child’s contribution merely because of an estranged relationship between the child and one of the parents.¹¹⁵A student loan may constitute a "contribution . . . from the child" to post-secondary education expenses within the meaning of section 7(2) of the Federal Child Support Guidelines and thereby exclude the need for any parental contribution.¹¹⁶It would be a mistake, however, to assume that a student loan will always be taken into account to reduce or eliminate the liability that would otherwise be imposed on the parents under section 7 of the Guidelines. The issue really turns on the reasonableness of taking account of any such loans in light of the case. Grants, scholarships and bursaries are treated on a different footing insofar as they involve a net transfer of resources to the child without any obligation of repayment. It has thus been held that a student loan is

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not a "benefit" within the meaning of section 7(3) of the Federal Child Support Guidelines that must be automatically taken into account in determining the amount to be ordered in respect of expenses sought under section 7 of the Guidelines.¹¹⁷It is uncertain why the guiding principle in section 7(2) of the Guidelines refers specifically to the respective "incomes" of the spouses or former spouses whereas section 7(1) uses the broader term "means."¹¹⁸In Mills v. Mills,¹¹⁹Master Powers, of the British Columbia Supreme Court, had regard to the respective means of the former spouses and not simply their respective incomes in concluding that the obligor’s contributions to after-tax daycare expenses should be reduced because of his obligation to support his child from a new relationship. And in Baum v. Baum,¹²⁰Martinson J., of the British Columbia Supreme Court, concluded that, in assessing the respective parental contributions to child care expenses, the court should take account of the "means," not just the income, of each parent pursuant to section 7(1) of the Federal Child Support Guidelines. The guiding principle of pro rata sharing of expenses in light of the respective "incomes" of the parents, which is established by section 7(2) of the Guidelines, was stated to be subject to the overriding mandatory provisions that regulate the exercise of judicial discretion under section 7(1) of the Guidelines. Consequently, a judicial discretion was deemed to vest in the court that enables it to have regard to the economic well-being of the spouses and their overall household income in light of newly formed spousal partnerships. In Speakman v. Willis,¹²¹however, McEwan J., of the British Columbia Supreme Court declined to endorse the reasoning of Martinson J. in Baum v. Baum, above, because section 7(1) of the Guidelines addresses the reasonableness of the expense, whereas...