How to terminate spousal support

[anonymous]

Has anyone had success terminating spousal support based on proving the spouse is self-sufficient.

Situation:
SA signed 1 year ago
Dad's income = $200,000
Mom's income = $125,000
1 daughter, now 8
Spousal support in SA = $1,000/month
CS - based on full offset table amount = $600/month

This year dad earned an $80k bonus, now mom is coming back for full table CS and $1,900/month SS.

Background: Mom has been with the same company for 16 years. Only took 1 year maternity leave. Lost nothing due to the marriage breakdown except dad's future income.

Any help would be appreciated.

[stripes]

What does your separation agreement or divorce order say about spousal support? Is there any review date or termination clause? Why was spousal support awarded in the first place - what was the justification?

With respect to CS, Mom would only get the full amount if the child resides with her more than 60% of the time. That's the tipping point between offset and full amount. The fact that you got a bonus means that your contribution to child support will be higher next year, but it doesn't mean that the form switches from offset to the full amount.

[anonymous]

This is the clause from the SA:

Spousal support may be varied if there is a material change in circumstances, even if the change was foreseen or foreseeable. The change may be:
(a) in either party's financial position;
(b) in the child support arrangements;
(c) Mom's remarriage;
(d) Mom's co-habitation with another person resembling marriage for a period of more than 36 months;
(e) Child turns 18, unless she is unable to become self-supporting due to illness, disability, education or other cause;
(f) in either party's health;
or any other similar change.

[anonymous]

Clarifying. She is not seeking full table. Just an increase in the off-set amount. My fault... typo. It is 50/50 custody.

[stripes]

The offset amount will increase if your income increases. Usually, this increase takes effect when you next exchange financial information and update CS, which most people do once a year at tax time. Does your agreement cover this?

With respect to SS, your agreement sounds pretty clear. Mom can seek a variation (increase) to SS because your financial status has changed. You can also seek a variation (reduction) of SS if you can show that there has been a change which warrants reducing or eliminating the amount you agreed to. What is the change that would trigger an end to SS? Is Mom earning significantly more than she did when you signed the agreement, or is it about the same? (E.g. if you signed the agreement a year ago and Mom's income and status haven't changed since then, you would have a hard time arguing that SS should be terminated).

If Mom is seeking an increase in SS because you got an $80K bonus, which is legit in terms of your argument, and you are seeking the elimination of CS because she has become more self-sufficient than at the time of separation, it might make sense to offer a compromise - you'll continue SS at the current rate for a set period and then it will come to an end.

[Rioe]

Has anyone had success terminating spousal support based on proving the spouse is self-sufficient.

Situation:
SA signed 1 year ago
Dad's income = $200,000
Mom's income = $125,000
1 daughter, now 8
Spousal support in SA = $1,000/month
CS - based on full offset table amount = $600/month

This year dad earned an $80k bonus, now mom is coming back for full table CS and $1,900/month SS.

Background: Mom has been with the same company for 16 years. Only took 1 year maternity leave. Lost nothing due to the marriage breakdown except dad's future income.

Any help would be appreciated.

I don't understand how anyone could believe someone earning $125k isn't self-sufficient already. How and why did she get SS in the first place, if she has such a good career and it wasn't damaged by the marriage? If you didn't think ~$125k was self-sufficient then, I don't know how you could possibly prove it is now.

If this $80k is a one-time bonus, argue that nothing should change. She'll get more CS next year anyway when you use the increased amount to update the offset CS payment.

[anonymous]

I understand now that I should not have agreed. We did the entire divorce withe mediators (no lawyers present) and they made me feel like this was "normal". They kept pushing the divorce mate numbers (which I wasn't familiar with). They used the "Spousal Support Advisory Guidelines" midpoint.

My lawyer was useless and didn't offer any advise. What I am trying to say is I made a mistake and now need to fix it. I am prepared to go to court if needed.

[arabian]

Much/everything depends upon basis that spousal support was awarded. It something has occurred to either party, which was not contemplated at the time the agreement or spousal support Order, then that would constitute a legitimate change of circumstances... reason a court would entertain discussion/review.

There are federal GUIDELINES on entitlement and percents (emphasis on "guidelines") as SS is not the same as child support.

It is not unusual for wealthy people (both) to agree or to have an Order for SS.

My situation is a perfect example. Simply put, my ex ripped me off big-time and left me holding the bag for large corporate debt. We mutually consented to a private binding mediation and outcome was my being awarded substantial SS (stepped down). I'm sure my ex, who lives in the woulda-could world would think that trial would have been better for him (doubtful as his shady actions might have put him in jail).

SS is decided on a case-by-case basis.

You have an agreement where basically if either party's income changes (foreseeable or not) it is deemed a material change of circumstance. That is pretty standard and what the annual exchange of financials is intended for. What is the formula for determining the amount? What is the quantum in your agreement?

[arabian]

I understand now that I should not have agreed. We did the entire divorce withe mediators (no lawyers present) and they made me feel like this was "normal". They kept pushing the divorce mate numbers (which I wasn't familiar with). They used the "Spousal Support Advisory Guidelines" midpoint.

My lawyer was useless and didn't offer any advise. What I am trying to say is I made a mistake and now need to fix it. I am prepared to go to court if needed.

IMO Mediators are just another enterprise making money off the divorce industry. You can find yourself a shark lawyer who can argue that you had no independent legal advice. You can then find yourself in front of a judge who will say "no wait a minute... let's examine the intent of the agreement." "Mr. and Mrs. xxx you were well advised that you opted for the mediation process in lieu of litigation and jointly came to an agreement." "This court is not going to interfere in a privately-negotiated agreement."

Does your SS agreement/SA provide for a "review" period?

I would recommend that you retain competent legal counsel. Take steps to protect yourself from being scorched by the lawyer though and ask for a quotation and "plan of action" with 'worst-case' scenarios along with time-lines.

[arabian]

BTW - if your received an 80K bonus - it is considered income and certainly would be 'fair game' in determining your income for the purposes of calculating SS.

[stripes]

As your SA was signed only a year ago, unless Mom's situation has changed dramatically in the past year, I don't think you will be successful in seeking to have spousal support reduced. Essentially, you would be asking to have a legal agreement thrown out simply because you changed your mind. It's unfortunate that you got bad legal advice, but you knew what the document said when you signed it. If things change in the next couple of years, you will have stronger grounds to go back and and ask for it to be varied because circumstances have changed, per the agreement.

I am sure that if you want to go to court you'll have no trouble finding a lawyer who will take your money and assure you that they can get you off the hook for SS, especially because your high income translates into lots of hourly billings for the lawyer, but I really don't think you have a strong case for varying an arrangement you agreed to a year ago. The only exceptions would be if you signed it under duress, or the agreement contravened the law, or you were deceived about factual elements of the agreement, or you lacked the capacity to understand what you were signing, but it doesn't sound like any of these are the case.

I also don't think Mom has much chance of getting SS increased to $1900 per month - Divorcemate calculations are not legally binding, and if your $80K bonus was a one-time thing, it doesn't translate into ongoing higher income for you. And I don't think a judge would have a lot of sympathy for someone who makes $125K and is already receiving SS.

Of course I am not a lawyer and could be completely wrong.

[arabian]

I agree with Stripes: you will definitely find a lawyer who will blow smoke up your arse. The best way to protect yourself from this is to become extremely well-informed on SS. You can get a tremendous amount of information from this forum.

People who are high-income earners (payors and payees) are not immune to SS. We just don't read about it on CanLii very often because many people prefer to settle their matters privately. This does not mean it doesn't happen. When you retain a lawyer I would recommend that you canvas him/her accordingly. You are now seeing that what you rashly, albeit in good faith, agreed to is costing you a good deal of money. Give this serious consideration and retain a "good" lawyer. SS is a nice tax deduction for you no?

[Rioe]

This is the clause from the SA:

Spousal support may be varied if there is a material change in circumstances, even if the change was foreseen or foreseeable. The change may be:
(a) in either party's financial position;
(b) in the child support arrangements;
(c) Mom's remarriage;
(d) Mom's co-habitation with another person resembling marriage for a period of more than 36 months;
(e) Child turns 18, unless she is unable to become self-supporting due to illness, disability, education or other cause;
(f) in either party's health;
or any other similar change.

Well, in the grand scheme of things, I guess paying $12k a year isn't that bad to someone making $200k plus $80k bonuses, especially when taxation is considered.

But now your ex is arguing that your $80k increase in income should qualify for a variation (increase) under part a) of your agreement. My math says that if $200k means you pay $1000 a month, then $280k means you should maybe pay another $400. Yet she's asking for much more than that, if she wants $1900 now. However, there's no possible justification for switching to full CS from offset unless custody timing has changed.

Is she just blustering, or does she have a lawyer involved and looks ready to take you to court?

Don't forget to get her financial disclosure too. Maybe she's had an income increase and you can do different math than I did above. Then, try telling her you don't think the bonus changes your financial position sufficiently or something. Remind her that she has a great income of her own and that most people in her situation wouldn't get SS at all and does she really want to rock that boat? Remind her that CS will increase next year when it's adjusted for income changes, and you feel that's good enough.

Then, if she gets a lawyer going and it looks like things may actually get to court, offer her $400 more a month. If she takes it, that helps you lock in what sort of change in SS should match a change in income. In EITHER direction. If she doesn't, and you end up before a judge, you can show that you already made a very reasonable, mathematically sound offer, and get your legal costs back from her if she loses.

[Links17]

How long were you were married?

[mafia007]

Normally, increases in income after separation should not be accounted as it's the earning you were making during the marriage that counts. A bonus or lump sum amount is definitely not accounted if it's only a one time payment and you can prove there is not a repetitive pattern over the years.

In fact, the law states that the only increases to be considered are the one pertaining to the same job you had during the marriage. Basically, the economic increase such as a raise of 2% or a promotion in the same career path. A new job with a different employer or a different new career would not be considered.

http://connectfamilylaw.ca/spousal-support-post-separation-increases-in-income/

You have been working hard and finally obtained that promotion, which includes a significant pay raise. Your talents and hard work have paid off.
In the midst of merriment and celebration, an unsettling skeleton appears from your past: your ex-spouse is eyeing your increase in pay and wondering whether s/he is entitled to a bump in spousal support.
Is s/he?
First, a court would have to confirm that there has been a change in the conditions, means, needs or other circumstances of either you or your spouse since the spousal support order was made or last varied.
Second, the court would have to find that the recipient spouse (i.e. the spouse receiving spousal support) contributed to the paying spouse’s post-separation increase in income. The recipient spouse would have to show that s/he contributed to the paying spouse’s skills or to the credentials s/he acquired during the relationship that led to the increased income.
1) A change in circumstances
Our court has determined that a significant increase in a paying spouse’s income is a material change.
2) Contribution to post-separation increase in income
The principle that emerges from the case law is that the recipient spouse is not entitled to spousal support based on the paying spouse’s increased post-separation income unless the recipient spouse can demonstrate a significant and direct contribution to the paying spouse’s ability to earn that income. This requires the court to identify the underlying reason for the paying spouse’s increased income, and then determine whether the recipient spouse contributed to those factors that gave rise to the increase.
In the Alberta case of O’Grady v. O’Grady, the paying husband was a “workaholic” who was able to increase his income after separation by taking a new position and continuing to work very hard, which resulted in him significantly increasing his annual income. The Alberta Court of Appeal in O’Grady commented that “while this was a long-term marriage and the respondent [wife] bore primary responsibility for raising the children, it does not automatically follow that the respondent [wife] should therefore be entitled to take advantage of her former husband’s work ethic.”
Conclusion
Generally, unless spouses agree that spousal support should be reviewed in the future using the payor’s increased income, or there are other circumstances linking the recipient spouse’s role in the relationship to the paying spouse’s increased income, increased income should not be used to alter a final spousal support order or agreement post-separation/divorce.

http://www.justice.gc.ca/eng/rp-pr/fl-lf/spousal-epoux/spag/p14.html

Under the current law, it is impossible to maintain either of these approaches to the exclusion of the other. Some rough notion of causation is applied to post-separation income increases for the payor, in determining both whether the income increase should be reflected in increased spousal support and, if it should, by how much. It all depends on the length of the marriage, the roles adopted during the marriage, the time elapsed between the date of separation and the subsequent income increase, and the reason for the income increase (e.g. new job vs. promotion within same employer, or career continuation vs. new venture). The extent of sharing of these post-separation increases involves a complex, fact-based decision..

Once again, it would depend on the length of your marriage and if your ex-spouse had made a contribution toward your new achievement at work. You can debate and definitely, it's a case by case basis approach.