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Common Law Issues The law regarding common law relationships is different than in cases of divorce. Discuss the issues that affect unmarried couples here.

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Old 09-20-2016, 03:00 PM
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Default Common Law - CS and Houses

Looking for clarification for a family member...

Just separated, common law relationship for 7 years. Two children, ages 5 & 1.5 years old.
Mom owns a house (only in her name) that they lived in for 5 years, about 4 months ago Dad bought a house (only in his name) which they have lived in for 4 months, and are renting out Momís house.

Dad makes approx $100,000, Mom makes approx $43,000. They are looking towards 50-50 access and joint custody. That being said, Dad doesnít think he should have to pay CS $700 in CS a month because the kids donít need that to live on. He is also stating they will pay daycare costs on their own during their time, instead of him being responsible for 70% of the costs. Tax benefits would be split, as per the government guidelines.

How slam dunk is this if Mom files in court? Dad says he wants to settle outside lawyers and court and they have agreed on 50-50, but he isnít agreeing to pay any CS and any mention of money, causes Dad to be irrational. He has stated that if she pursues CS, he will go after the equity in her house, because his house doesnít have any equity, so he doesnít care if he is forced to sell or not. Her house has approx $40,000 equity in it, but it located 30 minutes away from where they currently live in his house.

Being common law, they really donít have anything to split correct? Dadís name was never on Momís house (mortgage or title) and Momís name was never on Dadís house. Dad has RRSPís and such that Mom canít touch, so would Dad have any claim to Momís house? Mom is looking to sell her house and get a place closer to where they live now so that the children can stay close to Dad and not switch schools.

I guess the questions are...

1- Does Dad have claim to Momís house and the equity in it?
2- If Dad doesnít agree to CS, is it slam dunk for Mom to file in court?
3- Mom will inform CRA of the new arrangement once it is settled for child tax benefits, What will Dad need in order to file? Is that up to Mom to provide info to Dad or does Dad have to file on his own?

I am certain I know the answers to all of these, but would like to double check. Thanks!




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Old 09-20-2016, 03:37 PM
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He cant not agree to cs. Its a right of the child.

How much have the houses increased in value during the time they were together? I think only that amount is what can be split. And truly, if her house was being rented, the value could have dropped.

Daycare is a s7 expense whether he likes it or not. Even if he didnt need daycare for his time, she still needs it to work so its split proportionate to income.

I say she should file for support but request the offset and % for daycare. That way if shes eligible, she can file the order with a maintenance agency.
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Old 09-20-2016, 03:39 PM
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He could try for unjust enrichment, however would likely spend just as much or more as he could potentially get.

CS and S.7 are pretty straightforward if they have 50 50, he won't win in that if his position is simply that he doesn't feel the kids need it.

CRA, its up to dad to manage his own taxes.
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Old 09-20-2016, 09:25 PM
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No, the kids don't need $700. They need $1330 (moms CS table amt + dad's contribution). Housing is a big part of that - 2 extra bedrooms, increased utilities, and outside space can easily eat up $600/Mo. Not that anyone should bother arguing it with him.
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Old 09-21-2016, 11:01 AM
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You're right... It shouldn't be an argument by Dad has the view in shared access there is no support paid.

Another question... How does the rental property work? The rent she is getting only covers the mortgage and taxes (renters pay utilities)... Mom makes no money off it but does it still count as income for her over the past four months?


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Old 09-21-2016, 11:08 AM
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She would claim the income on her taxes BUT this is where the line 150 thing isnt applicable since the costs outweigh the income. She would treat it like self employed people treat their income.

It doesnt matter what dad thinks, child support is the right of the child.

Has she spoken to a lawyer?

She needs to file an order for support if he isnt going to agree. The equalization can be worked out separate. The bottom line is hes obligated to support his children.
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Old 09-21-2016, 05:23 PM
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Quote:
Originally Posted by Berner_Faith View Post
How does the rental property work? The rent she is getting only covers the mortgage and taxes (renters pay utilities)... Mom makes no money off it but does it still count as income for her ...?
If the rent is covering the mortgage, she is definitely making money off it (the amounts that go towards reducing the MTG balance are steadily increasing her net worth).

The Rental income net of expenses (ie the part you pay tax on) is counted towards income for CS calculation - same as for self-emoyment income - unless, the expenses are unreasonably high. If she is early in her mortgage, then likely her expenses (ie the interest portion of the mortgage) is quite high, so her net rental income could be argued as unreasonably low.
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Old 09-21-2016, 05:29 PM
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Quote:
Originally Posted by dinkyface View Post
If the rent is covering the mortgage, she is definitely making money off it (the amounts that go towards reducing the MTG balance are steadily increasing her net worth).

The Rental income net of expenses (ie the part you pay tax on) is counted towards income for CS calculation - same as for self-emoyment income - unless, the expenses are unreasonably high. If she is early in her mortgage, then likely her expenses (ie the interest portion of the mortgage) is quite high, so her net rental income could be argued as unreasonably low.


She would also have to pay insurance on the property plus taxes. All of these are expenses that reduce the income in CRAs mind which applies to the income for her CS.
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Old 09-22-2016, 11:54 AM
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Quote:
Originally Posted by Berner_Faith View Post
Dad doesnít think he should have to pay CS $700 in CS a month because the kids donít need that to live on.
Tell Dad to stop thinking and accepting. He will be paying CS like-it-or-not. It is the law.

Quote:
Originally Posted by Berner_Faith View Post
He is also stating they will pay daycare costs on their own during their time, instead of him being responsible for 70% of the costs. Tax benefits would be split, as per the government guidelines.
Again, good luck with that nonsense. The other parent bringing a motion would be successful on getting S7 ordered on the appropriate split.

Quote:
Originally Posted by Berner_Faith View Post
How slam dunk is this if Mom files in court?


Quote:
Originally Posted by Berner_Faith View Post
Dad says he wants to settle outside lawyers and court and they have agreed on 50-50, but he isnít agreeing to pay any CS and any mention of money, causes Dad to be irrational.
Then court may be the only option. Arbitration may be another option too. Dad is being an idiot.

Quote:
Originally Posted by Berner_Faith View Post
He has stated that if she pursues CS, he will go after the equity in her house, because his house doesnít have any equity, so he doesnít care if he is forced to sell or not. Her house has approx $40,000 equity in it, but it located 30 minutes away from where they currently live in his house.
He really needs to get some REAL legal advice.

Quote:
Originally Posted by Berner_Faith View Post
1- Does Dad have claim to Momís house and the equity in it?
My humble opinion. No.

Quote:
Originally Posted by Berner_Faith View Post
2- If Dad doesnít agree to CS, is it slam dunk for Mom to file in court?


Quote:
Originally Posted by Berner_Faith View Post
3- Mom will inform CRA of the new arrangement once it is settled for child tax benefits, What will Dad need in order to file? Is that up to Mom to provide info to Dad or does Dad have to file on his own?
They need in their agreement/order to explicitly state how taxes are being done. They will need legal assistance to get this clause done properly.

Quote:
Originally Posted by Berner_Faith View Post
I am certain I know the answers to all of these, but would like to double check. Thanks!
Random advice: Smack this parent in the head and tell them to get a grip.
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