The Ontario Court of Appeal, in Stevenson v. Smit, 2014 ONCA 521, upheld an agreement by parents that they would share the children’s expenses instead of having Table child support paid under the Child Support Guidelines.
This was not what the father wanted.
At the time of separation, the father had very low income as he was starting a new business. He had substantial assets, and planned to draw down on those assets to meet his obligations to pay for one-half of the children’s expenses. The parties entered into a separation agreement setting out this solution.
The children’s expenses included private school, camp fees, and post-secondary education.
Several years went by and the father’s income did not improve. He told the mother that he could no longer share in the children’s expenses. That led to litigation.
The mother brought an application to court asking the judge to decide on the amount that the father owed, so that it could be enforced. The father asked the court to allow him to stop sharing expenses, and to instead pay child support under the Guidelines.
The trial judge found that there was no basis to change the support under the agreement, as there was no material change of circumstances. The father had no income at the time of the agreement, and he still had no income.
The father appealed to the Superior Court and lost. He appealed to the Court of Appeal and lost. The Ontario Court of Appeal found that there was no material change of circumstances, so the father would be held to his agreement to share the children’s expenses instead of paying child support.
The father also argued that the court was required to apply the Child Support Guidelines, and that the material change of circumstance test was irrelevant.
However, the Court of Appeal found that the parties entered into a special arrangement regarding child support, outside the parameters of the Guidelines. The parties were entitled to do so, as the children’s needs for and entitlement to support were not bartered away.
In this case, the children would benefit financially from the arrangement to share expenses, given that the father had little income, so Table support would be very low.
However, if the situation was reversed, and the parties agreed to underfund child support, the decision would likely have been very different.
A good take-away is that parties can be creative in meeting the children’s financial needs, and can deviate from Table support, so long as the children will not be worse off than if support was being paid under the Guidelines.