Difference between revisions of "Spousal Support Arrears"

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}}When a person who is obliged to pay spousal support fails to meet some or all of that obligation, a debt begins to accumulate and the amount owing is called the payor's ''arrears'' of support.  

People generally have two different goals when arrears begin to mount up: the person responsible for paying support likely wants the court to reduce or cancel the arrears, while the person receiving the support will want the court to force the payor to pay what's owing.

This section provides an introduction to the problem of arrears. It discusses the reduction and cancellation of arrears of spousal support and the collection of arrears.

A person who owes arrears of spousal support, a ''payor'', will likely be interested in the ways that the outstanding amount can be reduced, while a person to whom support is owing, a ''recipient'', will be interested in collecting on the arrears. A person who owes arrears will generally have a difficult time convincing the court to forgive all or some of their debt. On the other hand, collecting arrears can be difficult as well, if for no other reason than the fact that you can't get blood from a stone. Unless the payor has another source of funds to draw upon, a recipient may discover that the outstanding support will never be recovered.

Despite these barriers and obstacles, it is possible for a payor to have their arrears reduced and, sometimes, cancelled altogether. At the same time, recipients have <span class="noglossary">access</span> to some very powerful and effective enforcement tools to collect outstanding arrears of support.

===Orders for support===

Orders for the payment of spousal support are enforceable like any other order of the court. Someone who breaches a Supreme Court order can be punished for contempt of court. As well, under the ''[[Family Law Act]]'', the Supreme Court and the Provincial Court can require the payor:

*to provide security for their compliance with the court order,

*to pay any expenses incurred by the recipient as a result of the payor's actions,

*to pay up to $5,000 for the benefit of another party or a child whose interests were affected by the payor's actions,

*to pay up to $5,000 as a fine, or

*to go to jail, if nothing else will ensure the payor's compliance with the order, for up to 30 days.

Unfortunately for people who would rather be jailed than pay, section 231(3)(c) says that:

Since orders for support require the payment of money, arrears can also be enforced as a judgment debt under the provincial ''[http://canlii.ca/t/84h5 Court Order Enforcement Act]'' for up to 10 years after the obligation to pay support has ended.

Payors can apply for an order reducing arrears that have accumulated under a court order under both the ''[[Divorce Act]]'' and the ''[[Family Law Act]]''. Such applications must be made using the act under which the support order was made.

===Agreements for support===

Arrears that have accumulated under a separation agreement are owed as a result of a contractual obligation to provide support. A separation agreement is a contract that can be enforced in the courts just like any other contract.

Agreements for support are most easily enforced by filing them in court, after which they can be enforced as if they were court orders. Although agreements can still be enforced under the law of contracts, it's a lot simpler to file them in court. Section 163(3) of the ''[[Family Law Act]]'' says:

 

 

Payors can apply under section 174 of the ''[[Family Law Act]]'' for an order reducing arrears that have accumulated under an agreement that has been filed in court just like they can for arrears accumulating under an order. Alternatively, they can apply to set aside and vary the agreement, prospectively or retroactively, under sections 164 and 167 of the ''Family Law Act'', or seek an order in terms different from the agreement under section 15.2 of the ''Divorce Act''.

Although recipients can enforce orders and agreements for spousal support on their own, most of the time recipients will give that job to the [http://www.fmep.gov.bc.ca/ Family Maintenance Enforcement Program], a BC provincial government program under the provincial ''[http://canlii.ca/t/840m Family Maintenance Enforcement Act]'' which has been contracted out to an American company, Maximus ― not that you'd know this from the government website.

 

FMEP is a free service for recipients that is largely funded by late fees and penalties charged to delinquent payors.

FMEP has no discretion to change the orders and agreements that are filed with it for enforcement. FMEP cannot increase or decrease the amount of a spousal support obligation and it cannot reduce or cancel arrears of spousal support. FMEP will not help you defend an application to vary the support order, set aside the agreement, or reduce or cancel arrears.  You will have to do that on your own.  But from the recipient's perspective, having FMEP take over enforcement of the order or agreement itself can be a huge relief.

==Reduction or cancellation of arrears==

Payors may apply to court to have their arrears cancelled or reduced. Technically, there are two ways to do that and each has its own considerations.

The two approaches are these.  The first is to say, in effect, “Yes, that is the proper amount of arrears.  I owe that, but I can’t pay it.  Please allow me some relief.”  It is essentially a ''debtor’s relief approach'' and as you might expect, the law takes a fairly hard view of this approach.

This is the approach the former ''Family Relations Act'' took.  In order to succeed, the payor had to show that failure to grant relief would be “grossly unfair” to the payor.

The second approach is to say, in effect, “Yes, this is the amount I owe under the original order or agreement, but my situation changed. If I had applied when the change happened, the amount would have been reduced.  So, please let me apply now and recalculate the arrears accordingly.”

This is the ''retroactive variation'' approach (applying late, or after the fact). The court still requires the payor to explain why they deserve a second chance, but it is a little easier to persuade the court to do this than to allow the payor to pay something less than the full amount.

Now, the ''Family Law Act'' allows both for a reduction or cancellation of arrears (section 174) and for a retroactive variation of a support order (section 167).  So, the cases that said there is only one approach under the former act no longer apply. Payors have a choice. This is important because it is a little easier to succeed on a retroactive variation than a pure cancellation or reduction of arrears. Just be sure you are clear with the court which route you are taking.

===Retroactive reduction of support===

Section 17 of the ''[[Divorce Act]]'' says this about varying orders for spousal support:

<blockquote><blockquote><tt>(a) a support order or any provision thereof on application by either or both former spouses; or</tt></blockquote></blockquote>

<blockquote><blockquote><tt>(b) a custody order or any provision thereof on application by either or both former spouses or by any other person.</tt></blockquote></blockquote>

<blockquote><tt>[...]</tt></blockquote>

<blockquote><tt>(3) The court may include in a variation order any provision that under this Act could have been included in the order in respect of which the variation order is sought.</Tt></blockquote>

<blockquote><tt>[...]</tt></blockquote>

<blockquote><tt>(4.1) Before the court makes a variation order in respect of a spousal support order, the court shall satisfy itself that a change in the condition, means, needs or other circumstances of either former spouse has occurred since the making of the spousal support order or the last variation order made in respect of that order, and, in making the variation order, the court shall take that change into consideration.</tt></blockquote>

<blockquote><tt>[...]</tt></blockquote>

Section 167 of the ''[[Family Law Act]]'' says this:

Retroactive variation applications are relatively new.  In 2006, the Supreme Court of Canada established rules for applying for retroactive child support, or for a retroactive increase in child support.  This is the case of ''D.B.S. v S.R.G.'' discussed in the chapter, [[Making Changes to Child Support]]. In the recent case of ''[http://canlii.ca/t/g80ht G.M.W. v D.P.W.]'' 2014 BCCA 282, our Court of Appeal said these principles also apply to applications for a retroactive reduction of support. Both involve child support, but the rules will be similar for spousal support.  For another example, see ''[http://canlii.ca/t/27qrq P.M B. v. M.L.B.]'', 2010 NBCA 5, in particular paragraph five.  

*the circumstances surrounding the delay in bringing the application, and

Delay might be explained if the other party promised not to rely on the full amount, or if the payor was temporarily incapacitated, or was unable to get appropriate information or advice. But the delay will have to be explained somehow. The courts will not be sympathetic to someone who just chose to let it slide.

Hardship is a two-way street.  The court has to consider the position of both the payor and the recipient.  If the recipient relied on the order or agreement and went into debt in the expectation that the arrears would eventually be paid, that weighs against granting relief.  If, on the other hand, it was clear to both parties that the order or agreement was unreasonable in light of current circumstances, that weighs in favour of granting relief. A retroactive reduction will be very unlikely if it would require the recipient to pay back money already received and spent.

There was some doubt whether a retroactive reduction was allowed under the ''Family Law Act'', but several cases have held that it is, including ''[http://canlii.ca/t/glb4d N.M. v G.M.]'', 2015 BCSC 1732.

Remember, though, that a retroactive variation application can only result in arrears being adjusted to what they should have been if the order or agreement had been adjusted for the relevant factors in a timely manner. If arrears would still have accrued, it does not allow any relief beyond that.

===Cancellation or reduction of (proper) arrears===

<blockquote><tt>

17 (1) A court of competent jurisdiction may make an order varying, rescinding or suspending, prospectively or retroactively,

:(a) a support order or any provision thereof on application by either or both former spouses; or …

</tt></blockquote>  

The power to cancel or reduce arrears under the ''Divorce Act'' is not often pursued, but it does exist: ''[http://canlii.ca/t/1p6l3 Haisman v Haisman]'', 1994 ABCA 249; and ''[http://canlii.ca/t/1d20m Earle v. Earle]'', 1999 CanLII 6914 (BCSC).

Section 174(1) of the ''Family Law Act'' says this:

In general, under the ''[[Family Law Act]]'', arrears will only be cancelled if a payor can show they are unable to pay the arrears "now and in the future": ''[http://canlii.ca/t/gmc40 MacCarthy v. MacCarthy]'', 2015 BCCA 496.  

If you are asking the court to make an order of reducing arrears, you must be prepared to prove that it would be not just unfair, but grossly unfair for you to have to pay off the arrears. You must be able to show evidence that supports the conclusion that not only can you not pay the arrears at present, but also in the future. You must also be prepared to address the criteria set out in section 174(2).

*Why did you wait until arrears had accumulated before you tried to vary the spousal support order?

*Why can you not pay your arrears now?

*Are there any other circumstances, such as catastrophic business losses or the unintended loss of your employment, or new financial obligations in relation to your family that the court should take into <span class="noglossary">account</span>?

Be prepared to provide to the court a Financial Statement (Form F8 in the Supreme Court and Form 4 in the Provincial Court) summarizing all of your assets and income, liabilities, and expenses, if you intend to show the court that you cannot pay your arrears. Complete financial disclosure is absolutely essential.

The collection of debts and enforcement of judgments occupies a whole course at law school and is not a simple matter. The provincial government has, however, established an agency responsible for enforcing support obligations, the Family Maintenance Enforcement Program (FMEP). You can find more information about FMEP earlier in this section. Someone entitled to receive support under an order or agreement can sign up with this program and the program will tend to the enforcement of the support without a great deal of further involvement on the part of the recipient.

FMEP is free for recipients. All you have to do is file your order or filed separation agreement with the program and fill out an application form. FMEP will take the matter from there, and the program is authorized by the ''Family Maintenance Enforcement Act'' to take whatever legal steps are required to enforce an ongoing support obligation, and track and collect on any outstanding arrears, plus interest accumulating on those arrears.

Under the ''[http://canlii.ca/t/840m Family Maintenance Enforcement Act]'', FMEP has the authority to commence and conduct any court proceedings that can be undertaken by a private creditor, as well as some unique actions that the program alone can take. Among FMEP's collection powers are:

*garnishing the payor's wages,

*collecting from a corporation wholly owned by the payor,

*redirecting federal and provincial payments owed to the payor, like GST or income tax rebates, to the recipient,

*prohibiting a payor from renewing their driver's licence,

*directing the RCMP to seize a payor's passport,

*registering a lien against personal property and real property owned by the payor, and

*obtaining an order for the payor's arrest.

While it is possible to undertake collection or enforcement proceedings on your own, this will cost money and time and possibly require you to hire a lawyer and bear that expense as well. Since any private collection efforts you might take may interfere with efforts being made on your behalf by FMEP, recipients enrolled with FMEP are required to obtain the permission of the program's director before they can take independent enforcement actions.

You can find more information about enforcing orders in the chapter [[Resolving Family Law Problems in Court]] within the section [[Enforcing Orders in Family Matters]]. You can also find more information at the website of the [http://www.justice.gc.ca/eng/pi/fcy-fea/sup-pen/enf-exe/info_cont.html Department of Justice], which includes a helpful overview of support enforcement mechanisms in Canada.

Section 163(3) of the ''[[Family Law Act]]'' allows a party to an agreement, usually a separation agreement, to file the agreement in the Provincial Court or in the Supreme Court. An agreement that is filed in court can be enforced as if it were an order of the court. It is not necessary for a court proceeding to have been started before an agreement can be filed in court.

FMEP will enforce agreements for support, however they require that an original copy of the agreement be filed in court and sent to them with the court's stamp before they can enforce the agreement.

You can find more information about enforcing agreements in the chapter [[Family Law Agreements]] within the section [[Enforcing Family Law Agreements]].

Section 20 of the ''[[Divorce Act]]'' says that an order made in a divorce action has legal effect throughout Canada. It also provides that such an order may be filed in the courts of any province and be enforced as if it were an order of the courts of that province. In other words, if your divorce order was made in Alberta and contains a term requiring spousal support to be paid, you can register that order in the Supreme Court of British Columbia and it will have the same effect, and be enforceable here, as if it were an order of the courts of British Columbia.

The provincial ''[http://canlii.ca/t/84l3 Interjurisdictional Support Orders Act]'' allows orders for spousal support made under provincial laws elsewhere in Canada, and in certain foreign states, to be filed in our courts and enforced as if they were British Columbia orders. The reciprocating states under the ''Interjurisdictional Support Orders Act'' are South Africa, Zimbabwe, Austria, the Czech Republic, Germany, Gibraltar, Norway, the Slovak Republic, the United Kingdom, the United States of America and its protectorates, the Special Administrative Region of Hong Kong, Singapore, Australia, Fiji, Papua New Guinea, New Zealand, and Barbados and its dependencies.

Foreign orders that are filed in this province may be enforced by FMEP as if they were orders made by the courts of British Columbia. You can find more information in the chapter  [[Resolving Family Law Problems in Court]], and in particular in the section [[Enforcing Orders in Family Matters]].

* <span style="color: red;">bulleted list of other pages in this chapter, linked</span>

* [http://www.clicklaw.bc.ca/global/search?k=spousal%20support%20bc%20ministry%20of%20justice Clicklaw: Spousal support help from BC Ministry of Justice]

{{REVIEWED | reviewer = [[David Dundee]] and [[Gillian Oliver]], May 15, 2019}}