Divorce/Separation

Parenting/Custody/Access

When parents separate the well being of their children are their top priority.

The governing legal principle that applies to matters regarding the custody of and access to the children is  “what is in the best interest of the child”.  A child is entitled to have maximum contact with each parent, consistent with the child’s best interests.

There are two types of custody – joint custody and sole custody.   These terms do not relate to the time that the children are with each parent, but define who will make the major decisions regarding the child.  Joint custody means that major decisions about the child, including decisions regarding the child’s education, health, religion are to be made jointly by the parents.  Sole custody means that the sole custodial parent makes the major decisions regarding the child, after consulting with the non-custodial parent.  In some cases parents have agreed, and courts have ordered, that decision making for the child be split with one parent making decisions about the child’s education and the other parent making decisions about the child’s health/dental care.

The Divorce Act and the Children’s Law Reform Act use the term “access” when referring to the non-primary parent’s time with the child.  More and more lawyers and Judges use terms such as “parenting time” and  “parenting plans” when referring to when a child will be with each of his/her parents.  The parenting plan is determined on the basis of what is in the best interest of the child. There are many possible parenting plans which are tailored to the specific needs of the child.

If a child resides with one parent more than 60% of the time that parent’s residence is referred to as the child’s primary residence.  If a child resides with each parent between 40% to 60% of the time this parenting plan is referred to as shared custody.  In the case of shared custody, different considerations are taken into account when determining the quantum of child support payable.

Child Support

Child support is determined in accordance with the Child Support Guidelines.   The Child Support Guidelines were enacted in part to provide a consistent approach when determining the quantum of child support payable by a payor.  The Guidelines make clear the quantum of child support that must be paid.  The Table amount of child support payable is based on the total annual income of the payor.

For income tax purposes child support is tax neutral.  In other words child support is not taxable in the hands of the recipient and is not tax deductible by the payor.

If the child resides with each parent between forty percent and sixty percent of the time this constitutes shared custody and different provisions under the Child Support Guidelines apply. The Table amount of child support payable is one of many factors to be considered when determining the amount of child support payable.

Factors may come into play which complicate the determination of the payor’s income for support purposes.  Such factors include a payor who is self-employed, has controlling interest in a corporation, is purposively under employed, is hiding income, or has an interest in a trust.

In addition to the Table child support the payor may be required to contribute to special and extraordinary expenses related to the child that arise from time to time.  The definition of special and extraordinary expenses under the Child Support Guidelines include daycare expenses, medical/dental expenses not covered by an insurance benefit plan, extraordinary extracurricular activity expenses and post secondary educational expenses.

Property

When parties are married or are in a common law relationship and one or both spouses decide to separate, property matters will arise as a result of the breakdown of the relationship.

Married Spouses

If the parties are married the Family Law Act applies, and property issues are resolved by way of an equalization of net family property.  The goal is for the parties to walk away from the relationship with equal value rather than dividing individual assets equally.  The spouse with the larger net value of family property is required to pay the other spouse half of the difference.  This payment is called the equalization payment of net family property.

Property as defined under the Family Law Act includes a variety of items including but not limited to your home, other real estate, pensions, RRSPs, bank accounts, investments,  business interests, trust interests, and foreign holdings.  Depending on the nature of assets and liabilities resolution of the property issues can be fairly straightforward or can be complex and require the involvement of professionals such as accountants, business valuators, corporate lawyers, and forensic accountants.

Common Law Spouses

Common law spouses have different types of remedies to deal with property issues which may arise from the breakdown of their common law relationship.  Ownership interest in property can be made by a common law spouse through constructive and resulting trust claims.