To be in need of money, and to be entitled to money as compensation for something, are two different things. Both conditions can exist at the same time, of course. But they are distinct legal concepts in family law. The recent decision in Gray v. Gray  from the Ontario Court of Appeal is an interesting illustration.

The parties were married in 1980 and separated in the mid-nineties. They have four children, who are now all adults. The husband remarried and started a new family and now lives in the United States with his new partner and three young children. He makes about $175,000 a year. The wife’s picture is far bleaker — she has not worked outside the home since she had a heart attack around the time of separation. She also has leukemia. Her long-term Canada Pension Plan disability benefits add up to about $33,500 a year. She lives in the former matrimonial home and has a bit of equity, but little else.

The wife’s financial problems began after the kids grew up, and child support payments from the husband therefore ceased. It was okay at first, because the court increased her spousal support dramatically to replace the terminated child support. The husband fought back, though, and got another court order cutting the spousal support down to what it had been originally, leaving the wife in dire straits, with thousands less per month that she was used to.

She went to the Ontario Court of Appeal, and they sided with her. The appeal court discussed the concepts of need vs. compensation, and ruled that she qualified for both. Given this entitlement, her spousal support was boosted back up again.

Compensatory spousal support, the appeal court noted, is meant to give a spouse monetary payback for any career sacrifices made during the marriage, and also post-separation. Typically, this involves one spouse putting their career on hold so they can take care of the children. It’s an interesting question as to whether caring for kids instead of having a job is always a “sacrifice” — after all, some people prefer kids to bosses — but when a marriage breaks down, and the caregiver is left to fend for him or herself in the job market with a gaping twenty-year hole in their resume, it definitely seems like a sacrifice was made. Accordingly, the law says there is an entitlement to financial compensation.

In this case, the appeal court noted that the wife worked as a flight attendant and arranged her schedule to accommodate childcare responsibilities. “She planned her schedule to fly on weekends, when Mr. Gray was available for child care. In addition, she took frequent unpaid leaves of absence, some related to giving birth, and others to have time off at home.”

After separation, she had custody of the kids, who were 15, 13, 8 and 5 years old. “It is clear she undertook the bulk of the responsibilities relating to the children,” the appeal court observed. “Her labour on the home front during these years enabled Mr. Gray to pursue his career without undue concern for the day-to-day realities of child rearing. During this time, Mr. Gray’s income increased substantially.” So, the lower court was “clearly wrong” when it ruled that she didn’t qualify for compensatory support.

Simply being “in need,” on the other hand, has nothing to do with sacrifice or compensation. The wife in this case qualified as being in need because her health problems prevent her from working. Furthermore, noted the appeal court, “need is not measured solely to ensure a subsistence existence.”

Once entitlement was established, the Appeal Court then turned to the Spousal Support Advisory Guidelines (SSAG), which are “neither legislated nor binding, but they are a useful tool.”  Keeping in mind that the SSAG are to be considered only once entitlement is established, there are two formulas: “without child support” and “with child support.” The latter gives you less spousal support — after all, you’re already getting child support dollars and, as the appeal court noted, this gives you the benefit of “financial synergy.” But once the kids are grown up, so long as you’re still entitled to spousal support on the basis of need, or compensation, or both, you can “cross over” into the SSAG “without child support” formula and boost it back up. That’s exactly what the appeal court did here, although not all the way to what it had once been. Accordingly, they noted, the wife will now have to make some “lifestyle choices.”

 

Bill Rogers is a Toronto lawyer and blogger covering family law and fertility law issues, and a columnist for the Medical Post covering the law of malpractice.

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