Report of the Follow-Up Committee on the Quebec Model for the Determination of Child Support Payments
In June 1996, the Minister for Income Security and the Minister responsible for the Status of Women tabled a consultation paper distributed to groups and organizations affected by the system of determining child support payments. On August 28 and 29, and September 30, 1996, public hearings were held on the subject. As a result, on October 25, 1996, a joint brief was submitted to Cabinet by the Minister for Income Security and the Minister of Justice reviewing the main recommendations made during the hearing process.
The ensuing reform was essentially due to the inadequate amount of support sometimes awarded by the courts and the unpredictable nature of the support payment decisions handed down. The brief of October 25, 1996, makes the following point:
Current legislation respecting the determination of support provides only limited guidelines that leave a great deal of discretion to the courts. In exercising this discretion, judges may end up establishing very different support payments for very similar situations. Moreover, the need to fully assess the tax consequences of paying support adds to the unpredictable nature of support awards: the problem of calculating tax consequences when determining child support payments will, however, be solved by removing child support from the tax system.
Nonetheless, even with such changes to tax treatment procedures, current methods for determining support do not guarantee that families in similar circumstances will be awarded similar amounts of support.
An Act to amend the Civil Code of Québec and the Code of Civil Procedure as regards the determination of child support payments (1996, c. 68) was approved on December 23, 1996 (Bill 68). The Act and its regulations, including a form and a table, came into force on May 1, 1997 (Appendix 1).
The legal framework for determining child support payments was thus substantially modified, the result of various findings pertaining to the rules in place up until that point.
Here we must stop for a few moments to variation the reasoning behind the reform of the system for determining child support payments. Before the reform, the criteria for determining support were very simple (some would say too simple). If the parents were unable to agree upon an amount—and based on the principle that even though they have separated, parents still had a shared responsibility with respect to their child or children—the courts considered, on a case by case basis, both the needs of each child and the financial situation of each parent. In the more typical case of the mother being awarded custody, the financial situations of the parents were compared in order to determine the amount of child support to be provided by the non-custodial parent:
The problem with this way of proceeding is that the courts enjoyed a vast latitude in assessing levels of support. A number of studies conducted in the 1980s reveal that this system often resulted in child support awards which were insufficient, and that major discrepancies in similar situations were apparent in the decisions of various judges. In order to address these problems, the government decided to implement a system for determining support payments based, in part, on pre-established tables.
Furthermore, it is important to emphasize that the Federal Child Support Guidelines also came into force on May 1, 1997, at the same time as An Act to Amend the Divorce Act. At this point, Quebec was empowered by order in council to apply what it defines as the “applicable guidelines” in accordance with the Divorce Act (SOR/97-237, (1997) 131 Canada Gazette, Part II, 1415) (Appendix 2). As a result, when both parties reside in Quebec, the Quebec model applies, even in matters of divorce. Thus the vast majority of Quebec’s child support orders are handed down in accordance with the Quebec model.
It should be pointed out that the model comprises all the various elements appearing in the order in council. The model includes not only the Regulation and its schedules 1 and 2 (form and table), but also the rules outlined in the Civil Code of Québec and the Code of Civil Procedure, which are listed in the order in council as well.
On May 1, 1997, new tax rules respecting child support payments also came into force. Since that time, for all intents and purposes, payers of support have no longer been entitled to deduct support payments from their income, and support is no longer included in the taxable income of the recipient, but instead is considered as net. These new tax rules resulted from the proceedings initiated by Suzanne Thibaudeau who took her case to the Supreme Court of Canada in order to argue that child support payments should not be taxed as income. Even though the Supreme Court did not rule in her favour, the governments of Canada and Quebec subsequently followed up on her request.
The new Quebec model for the determination of child support payments pertains to applications for child support filed on or after May 1, 1997. As opposed to the federal guidelines that apply to matters pending as of May 1, 1997, Quebec’s legislation specifically stipulates that the model does not apply to matters pending as of this date, since the new procedure requires that an application be accompanied by the appropriate form and the prescribed documents in order to be heard. Quebec’s lawmakers clearly did not deem it appropriate to require such documentation for applications filed before May 1, 1997.
The Quebec Court of Appeal has ruled that the federal guidelines are immediately applicable and accordingly are applicable to matters pending. In another decision, the same court ruled that the Quebec model was not applicable to matters pending and that the federal guidelines were thus in force with respect to matters of divorce.
Furthermore, the legislation stipulates that as of May 1, 1997, judgments awarding both child and spousal support must explicitly state the amount allocated to each party. This is certainly the best approach to take given that the model applies only to matters of child support and that the support payments thus determined are not subject to taxation, whereas spousal support payments continue to be treated as taxable income.
The model applies to any application for review variation of a support settlement support order filed as of May 1, 1997; it does not automatically apply to support payment settlements established prior to that date. If one of the parents wishes to see changes made to the support agreement in force, he or she must file an application for review variation of a support settlement support order by using the form stipulated in the Regulation. In addition, the Court of Appeal has ruled that the coming into force of the new rules constituted a significant change that justifies an application for review variation of a child support settlement support order.
THE BASIC PRINCIPLES OF THE MODEL
The principles are stated in the joint brief of October 25, 1996, and constitute the basis for the Quebec model for the determination of child support payments. They are as follows:
- to affirm the joint responsibility of both parents for their children pursuant to the provisions of the Civil Code of Québec, in particular articles 585, 587 and 599
- to ensure that the needs of the children are met to the extent of the parents’ ability to pay (support determined in light of the child’s needs and the parents’ respective incomes)
- to divide responsibility for providing financial support for the children between both parents (not only the non-custodial parent), in proportion to their respective incomes
- to give priority to the paying parent’s support obligation with respect to expenditures exceeding his or her own essential needs
- to provide, as far as possible, equal treatment for all children from various unions with respect to their right to support
- to maintain as far as possible the incentive for low-income parents to meet their support obligations to their children.
THE MODEL MAKES IT EASIER TO DETERMINE CHILD SUPPORT PAYMENTS
Support payments are calculated based on the following information:
- the income of both parents;
- the number of children;
- the nature of the custodial arrangement; and
- certain additional expenses relating to the children’s needs, if applicable.
The model was designed in such a way as to ensure that the children’s needs are met and that support payments are adequate and predictable, while taking in account the incomes of both parents. It was also designed to make determining child support payments easier, quicker and less expensive.
The amount of support may be determined by applying the various rules provided both in the Act and the Regulation; the guidelines are made complete by the addition of certain practical and user-friendly tools, namely the form and the table. By applying these specific standards, the basic parental contribution can be established, based on the income of both parents and the number of children involved. Calculated according to the model, this contribution is considered to correspond to the needs of the children and the parents’ ability to pay. A proof of need is no longer required in order to establish a child’s basic needs.
If necessary, this contribution may be increased so as to take certain child-related expenses into account. Such expenses must either be agreed upon or proven. They include child care expenses, post-secondary education expenses and special expenses, and may be added to support payments, if they meet the definitions provided in the Regulation and insofar as they are reasonable in light of the needs and abilities of each party.
These standards have been introduced in order to reduce the number of confrontations between parents, as well as the delays and costs that arise during the process of determining child support payments. The model provides parents with the necessary tools to determine, on their own, the amount of support to be paid for their children.
The model is flexible enough to enable parents to agree upon an amount that differs from that provided by applying the Regulation respecting the determination of child support payments. They must, however, clearly state the reasons for this variance in their agreement, and it is the court’s duty to ensure that the amount agreed upon is sufficient to meet the needs of the child.
If no agreement exists between the parties, it must be demonstrated, before the model can be bypassed, that the amount of support as determined would cause undue hardship for one or the other parent. Furthermore, the court can increase or decrease the support payments to take into account the value of a parent’s assets or the resources available to the child.
HOW THE AMOUNTS LISTED IN THE TABLE TO DETERMINE THE BASIC PARENTAL CONTRIBUTION HAVE BEEN DERIVED
The table is based on estimates of child-related expenses in relation to family income, estimates determined by using data concerning consumer spending on goods and services by Canadian households.
As a rule, it is considered that the expenditures of families with the same income will be the same regardless of whether or not they have children. Families without children simply spend their incomes differently. Thus, in order to determine the cost of children for a family, an indirect method must be applied. Expenses for children as a proportion of necessary family expenditures is used as an indicator of child-related expenses, given that having a child inevitably leads to additional expenditures. The basic parental contribution covers the nine recognized essential needs: food, lodging, communications, housekeeping, personal care, clothing, furniture, transportation and recreation.
The expenditures for essential needs have been compared for each family income bracket and according to the number of children in the household (0, 1, 2 or 3 children). These comparisons help determine the additional expenses for these needs incurred with the arrival of a child in the family, as well as the relative weight of child-related expenses. Next, the relative weight of the children with respect to various budgetary items is applied to the entire family budget for goods and services. Hence this technique takes into account both so-called essential needs and all other child-related needs that lead to expenditures other than for the basics, such as savings, travel, etc.
To summarize, by applying the above method, the average expenditures incurred for children in our society can be determined for each family income bracket.
Thus the basic parental support contribution as outlined in the table takes into account the real cost of the child’s essential and non-essential needs, and not any sort of fictitious costs. In other words, all of the children’s needs have been taken into consideration in establishing the table. Nevertheless, in order to allow for the specific needs of certain children, the model is flexible enough to include the possibility of adding other child-related expenses to the amounts established in the table.
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