Background

The husband brought a Motion to Change seeking to terminate his spousal support obligation. He had paid spousal support to the wife for 16 years following their 26-year marriage. The wife’s position was that the husband should continue to pay spousal support in the reduced amount of $650 per month from January 1, 2021 until December 31, 2021, and thereafter in the amount of $1,317 from January 1, 2022 until December 2026.

The parties were divorced pursuant to the October 6, 2005 Order of Justice Sheffield which provided that the husband was to pay the wife spousal support in the amount of $5,500. The Order of Justice Sheffield stipulated that if there was a material change in circumstances of either party after July 1, 2010, the wife’s entitlement to spousal support could be reviewed. The Order also stipulated that the wife must try make reasonable efforts to increase her earnings. The consent Order of Justice Pollowin, dated May 11, 2015 reduced spousal support to $4,550 per month. Justice Polowin’s Order also specifically provides that the husband’s retirement would constitute a material change in circumstances.

In September of 2020, the husband provided the wife with notice that he would be retiring in January and he stopped paying spousal support as of this date. Upon retirement, the husband’s employer offered him a 12-month contract with a salary of $105,000. The husband formed a company for the sole purpose of receiving this payment. In January of 2021, the ownership of the husband’s former employer changed, and the new owner terminated the husband’s contract on January 31, 2021 and paid the husband $72,188. This amount was paid to the husband’s company for services and the husband continues to take $12,000 per year from his company until the amount is paid in full.

The parties agreed that the husband’s retirement constituted a material change in circumstances. As such, the only question was whether the husband’s support obligation should be terminated or whether it should be reduced and if so, to what amount.

Analysis

Pursuant to section 17(1) of the Divorce Act, a court may vary, rescind or suspend an order for support. However, before doing so, it must first be satisfied that a change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the order. The objectives of a variation order varying a spousal support order are as follows: (a) recognize any economic advantages or disadvantages to the former spouse arising from the marriage or its breakdown; (b) apportion between the former spouses any financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage; (c) relieve any economic hardship of the former spouses arising from the breakdown of the marriage; and (d) in so far as is practicable, promote the economic self-sufficiency of each former spouse within a reasonable period of time.

In determining whether the husband’s support obligation should be terminated or reduced, the court examined the circumstances of both the husband and the wife. The husband’s decision to retire was made as a result of his health and his age. He had a heart condition which required him to take medication four times a day and he was diagnosed with stage 4 throat cancer in 2016. Recently, the husband was diagnosed with stage 3 cancer. In addition to the $12,000 a year he drew from his company, his income comprised of CPP benefits and his pension. However, the husband’s pension was equalized and there remained only $19,431.48 per year and he could not receive his Old Age Security pension until 2022. His lawyer had calculated his annual income for 2022 to be $68,005.

With respect to the wife’s circumstances, she maintained she had a strong compensatory basis for spousal support as the parties cohabited for 29.5 years, she gave up her position at Bell to move and follow the husband in his job, she stayed at home full-time for 11 years to raise the children and she assisted the husband in his business as an office manager. She asserts that her employment circumstances have remained “basically the same” since the parties separated and that she has only ever been offered seasonal, part-time employment. Her lawyer estimated her 2022 income would be $37,821 but this was under the assumption that she would not continue with her current part-time employment. The judge took issue with this assumption and included her employment income for 2021 of $17,195 and her employment insurance benefits of $11,110 for a total income of $58,626.

The judge then noted that the difference in the parties’ incomes was about $10,000. When the husband’s dividend or employment income was included, the SSAGs resulted in a range of spousal support from $293 to $391 per month which, even if you account for the 29.5 years of cohabitation, would be less than the $650 per month in spousal support that the wife was proposing for 2021.

Conclusion

The court concluded that the husband’s spousal support obligation be terminated effective January 1, 2021. The court came to this conclusion after finding that the wife did not have a continued need for spousal support as her Financial Statement did not disclose any debts, even though the husband had stopped paying spousal support in January 2021. The court also took issue with the fact that there was no evidence that the wife had tried to find full-time employment, despite the fact that Justice Sheffield’s order expressly required her to “try to increase her earnings” and “make reasonable efforts to do so”.

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