In addition to the emotional stress that can come with going through a divorce or separation, many parents might also feel the financial pinch that can come with the breakup of a family. It may not be obvious to the layperson what their financial obligations will be following a separation. Even those familiar with terms such as spousal support or child support might not be aware of the extent they may owe or what is included and not included in support calculations.
In a recent decision from the Court of Kings Bench of Alberta, a father challenged an application from the mother to have him pay what are known as Section 7 expenses (they get their name from Section 7 of the Federal Child Support Guidelines).
The parties married in September 2006 and were together for over 12 years. They had two children while married. The children were aged 15 and 11 at the time of the hearing. The parents’ divorce was made final in June 2020. The Divorce Judgment contained a term outlining the father’s child support obligations, stating,
“26. Spousal support payments shall be adjusted yearly to reflect an increase or decrease in the amount of child support payable, to ensure a gross monthly payment representing combined child and spousal support a total of $3,000 per month, payable to (the mother) from November 1, 2018 until November 1, 2025 once spousal support shall terminate. Child support subsequent to November 1, 2025 shall be payable commensurate with the Federal Child Support Guidelines.”
The mother’s application requested that the father pay S7 expenses on an ongoing basis and retroactively, dating back to September 2021. S7 expenses are designed to cover “special or extraordinary” expenses such as medical bills, post-secondary education, childcare or sports programs for children.
The mother’s position was that Section 26 of the Divorce Judgment was always intended to include spousal support and child support but not S7 expenses. However, the father argued that the language of the Divorce Order, specifically the phrase “combined child and spousal support,” amounting to $3,000 monthly, was intended to include S7 expenses.
The court explained that much of the evidence provided by the parents, focusing on circumstances that existed at the time of the divorce, needed to be more helpful in the analysis. Instead, the court stated that the only analysis needed to be performed was on the wording of Section 26 of the Order and the Order as a whole.
The father had stated that Section 26’s use of the phrase “gross monthly payment” in relation to “combined child and spousal support” means that it should include regular child support payments and spousal support, and S7 expenses. However, the court pointed out that in a family law context, the word “gross” is often used in relation to tax implications, specifically that a gross amount is calculated before tax. The court added that the word “gross” is not intended to consider the extent of support payable.
The court noted that Clause 16 of the Order addresses S7 expenses, stating that the father’s share is 81.1%. Eligible expenses included childcare, medical and dental premiums, unanticipated insurance, extracurricular activities, and extraordinary expenses for primary education.
The Order stated that the parties were required to exchange receipts and invoices of S7-related expenses and that repayment is required within 30 days of a receipt or invoice being provided. Another clause recognized that expenses might change from year-to-year and that each parent has an obligation to inform the other if there is an anticipated increase in S7 expenses in any given year.
The court said it only makes sense that the father was required to pay his proportionate share of S7 expenses in addition to his standard (or “S3”) child support, equal to $1,969 per month. If that was not the case, there would be no need for any further details around S7 expenses, such as the requirement to exchange receipts and invoices or to order payment within 30 days of receipt of such. After all, if the S7 expenses were included in monthly child support payments, there would be no need to pay again within 30 days.
The father asked the court to consider his position that child support obligations typically include both S3 and S7 payments. The court said that might be so because they are often considered together and included in the same Order. However, the Order that covers the parties’ divorce clearly made an exception to that approach by listing them individually.
Finally, the court made a point to clearly explain the differences between S3 and S7 expenses, stating,
“3 support and s 7 expenses are markedly different. Section 3 support is base support and is paid in accordance with the amount set out in the Federal Child Support Guidelines. It is called “child support” in s 3. It is an amount the recipient expects to receive each month, together with any spousal support payments, to run the household. Section 7 expenses are extraordinary expenses. That is what they are called in s 7. They are not referred to as “support”. Section 7 does provide that these expenses “may” be included in a child support order, but this too suggests that they are not considered child support, only that they may be included in such an order. Notably, either party may incur extraordinary expenses and require proportionate reimbursement from the other party. The reimbursement of any or all of these expenses is not ““support”” in a true sense and does not provide support to the receiving party. It merely reimburses them for actual expenses they have incurred for the child or children.”
The court ordered the father to pay his proportionate share of retroactive S7 expenses from September 2021.
If you have questions about spousal or child support rights or obligations, call Mincher Koeman in Calgary at 403-910-3000 or contact us online. Our experienced family law lawyers represent clients in a variety of family issues following a separation or divorce. They can work with you to ensure you understand your rights and obligations related to support or other family law matters.
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