Spousal support is not automatic or guaranteed just because a support calculation states that an amount is payable. The first step is to determine whether someone is entitled to spousal support. There are three grounds for entitlement: (1) Contractual, (2) Compensatory, and (3) Non-compensatory.

Grounds for Entitlement

(1) Contractual: a contract, such as a prenuptial agreement, may include provisions for spousal support in the event of a separation. You may be entitled to spousal support on this ground if you have a marriage agreement or cohabitation agreement that confirms your entitlement.

(2) Compensatory: Compensatory spousal support is intended to provide compensation to the recipient spouse for any economic disadvantages arising from the marriage (or its breakdown), or any economic advantages gained by the other spouse. The compensatory support principles are rooted in the notion that spouses are entitled to receive compensation for losses caused by the relationship (or as a result of the breakup of the relationship), which would not have been suffered otherwise. The intention is to share the economic benefits and burdens of the marriage and its dissolution.

While each case is fact-specific, in long marriages with children, the marital standard of living may be used to determine a reasonable amount of spousal support payable. Even if the recipient spouse has attained a degree of self-sufficiency, spousal support based on compensatory principles should continue until compensation is achieved.

(3) Non-compensatory: When compensatory principles do not apply, need alone may be sufficient to establish entitlement to spousal support. Non-compensatory support is grounded in the “social obligation model” of marriage, in which relationship is seen as an interdependent union. It embraces the idea that upon dissolution of a marriage or common law relationship, the primary burden of meeting the needs of the disadvantaged spouse falls on his or her former partner, rather than the government. Non-compensatory support aims to narrow the gap between the needs and means of the spouses upon marital breakdown. For that reason, it is often referred to as the “means and needs” approach to spousal support.

A spouse’s “need” for spousal support is subjective and varies based on the parties’ standard of living during the relationship. For example, a judge might determine that a spouse with a Guideline Income of $100,000 has the means to pay spousal support to his or her spouse with an income of $10,000. In this case, the recipient’s need is clear because an income of $10,000 would leave the recipient in poverty without financial support. Conversely, a judge might determine that a spouse with an income of $100,000 has a need for spousal support if his or her spouse has an income of over $1 million. In this case, the recipient spouse does not need spousal support to meet his or her basic needs, but spouses are entitled to maintain a comparable standard of living that that they became accustomed to during the relationship; particularly if the relationship was long and there was a degree of financial dependence or reliance during the relationship.

Even in cases in which spouses both receive a sizeable share of family assets, “need” for spousal support may be established because spouses are not expected to encroach on their capital to financially support themselves.

Where a relationship between spouses was emotional but never economic, and an applicant’s capacity for economic self-sufficiency is not impaired or diminished during the course of the relationship. In these cases, the courts have determined that there is no basis for an award of non-compensatory spousal support.

Non-compensatory support is not automatically ordered whenever there is a great disparity in the parties’ incomes. Each case turns on its own unique circumstances. For that reason, it is important to meet with an experienced lawyer who is familiar with the most up-to-date case law on this subject.

Quantum and Duration

After a judge determines that a spouse is entitled to spousal support, the Spousal Support Advisory Guidelines can assist the judge in determining the quantum (amount of support) and duration (length of time that spousal support will be paid).

        Range of Support:

The child support Tables in the Federal Child Support Guidelines provide a specific amount of child support that must be paid, but the Federal Spousal Support Advisory Guidelines provide a range of spousal support that may be paid. Judges typically order spousal support based on the low end of the range, the midpoint, or the high end of the range.

Although the judge is not bound by the Spousal Support Advisory Guidelines and may order an amount that is outside of the range recommended, the range will assist the judge in calculating an appropriate monthly amount or lump sum amount payable based on the following factors:

• the parties’ respective Guideline Incomes;
• whether the parties’ have children, and if so, how many children, and their ages;
• the duration of their relationship; and
• their ages of the spouses as of the date of separation.

Many people think that defaulting to the midpoint is the “fair” result, but it is an error to default to the midpoint. Determining whether the low, mid, or high end is appropriate may depend on several factors, such as:

• the strength of the recipient’s compensatory claim;
• the recipient’s needs;
• the age, number, needs and standard of living of the children;
• the needs and ability to pay of the payor;
• work incentives for the payor;
• self-sufficiency incentives for the recipient; and
• whether either spouse is assuming a disproportionate share of the family assets or debts.

        Determining Guideline Income

Calculating each spouse’s Guideline Income may be as simple as referring to line 150 in each spouse’s income tax return or notice of assessment. In that case, you may be able to calculate an appropriate amount of spousal support (and child support, if applicable) with a child support and spousal support calculator available online.

Line 150 is often an accurate determination of Guideline Income if both spouses are employees with steady incomes. However, there are several factors that may complicate the calculation, for example:

• Income may be imputed to someone who is intentionally underemployed or unemployed if that person is capable of earning more.
• Union dues may be deducted from someone’s Line 150 income.
• Self-employed individuals are entitled to deduct legitimate business expenses from their incomes, but some expenses deducted in an income tax return may be added back to the person’s income if he or she received a personal benefit from the expense.
• If either party owns a corporation, a Guideline Income Report may be required to accurately determine the amount of income available to that person, because owners of corporations often pay themselves less than they could in an effort to minimize their income taxes.
• Non-recurring income (such as a one-time bonus; capital gains from the sale of a property; or an RRSP withdrawal to pay legal fees) may be deducted from a party’s income.
• If a party’s income fluctuates, it may be appropriate to average that person’s income over the last three years.

        Commencement Date:

The general rule is that the effective date for spousal support to commence is the date that a filed Notice of Family Claim (in which spousal support is sought) is served on the other spouse. This is referred to as the “date of effective notice” because it provides clear notice to the payor that support is being claimed. If you are unable to immediately file and serve a Notice of Family Claim, it may be helpful to provide clear notice in writing to the other spouse that you require spousal support and will commence court proceedings if he or she does not agree to pay voluntarily.

If you later go to court to seek spousal support, the judge may grant an award for ongoing spousal support and may grant retroactive spousal support back to the date of effective notice.

This general rule may not apply if the payor intentionally hid income or refused to disclose his or her income.

        Termination Date:

The duration of spousal support may be for a limited term or indefinite, depending on the length of the marriage and self-sufficiency considerations.

The Spousal Support Advisory Guidelines provide a range for periodic payments or lump sum spousal support after taking into account case-specific factors, such as:

• the length of the marriage/relationship;
• the parties’ ages at the date of separation;
• the parties’ respective incomes or capacities to earn income; and
• whether there are dependent children.

        Indefinite Spousal Support, Subject to Review and Variation

An order for indefinite spousal support does not necessarily mean permanent support, nor does it mean that support will continue indefinitely at the same amount. The quantum and duration of spousal support may be reviewed if there is a change in the condition, means, needs or other circumstances of either spouse. For example, if the recipient’s income capacity significantly increases; if the recipient re-marries or enters a new common law relationship; or if the payor’s income is reduced due to illness, disability, or retirement.

        The “20 Year Rule”

When a marriage or common law relationship lasts approximately 20 years or more, spousal support is often ordered indefinitely, subject to review and variation. As mentioned above, “indefinite” does not necessarily mean “forever.” However, in shorter relationships, a fixed duration of spousal support is usually ordered unless the “Rule of 65” applies.

        The “Rule of 65”

Indefinite support (subject to review and variation) may be ordered if the age of the recipient at the time of separation + the length of the relationship (in years) equals 65 or more. For example, if two people live together in a marriage-like relationship for 15 years and the recipient of spousal support is 50 years old at the date of separation, he or she may be entitled to indefinite support because 50 +15 = 65.

This rule does not apply to short relationships under 5 years in length. For example, if two people marry at the age of 62 and the marriage only lasts 3 years, the recipient spouse is not entitled to rely on the Rule of 65 to obtain indefinite support.

Periodic (Monthly) Support or Lump Sum Payments

Monthly spousal support is taxable income for the recipient and tax deductible for the payor. A Lump sum spousal support payment is not taxable income for the recipient, and it is not tax deductible for the payor. When either party wishes for spousal support to be paid in a lump sum, lawyers use legal software to calculate the mid-point, which will reduce the lump sum amount payable after taking the tax considerations into account.

Although it is far more common for monthly support to be ordered, a lump sum spousal support award may be preferable in some cases. When deciding whether to order a lump sum payment, a judge will weigh the advantages and disadvantages of a lump sum payment compared to an order for monthly support.

It is undisputed that a lump sum award of spousal support should not be made in the guise of support for the purpose of redistributing assets. However, a lump sum order can be made to relieve financial hardship for the recipient.

An important consideration in determining whether to make a lump sum spousal support award is whether the payor has the ability to make a lump sum payment without undermining the payor’s future self-sufficiency. The judge will consider any perceived advantages and disadvantages to both of the parties. The advantages of ordering a lump sum payment will be highly variable and case-specific, but they may include:

• the benefit of terminating ongoing contact or ties between the spouses for any number of reasons (for example, after a short-term marriage; in cases involving domestic violence; or if it is the parties’ second marriage with no children,etc.);
• providing financial resources to meet an immediate need of the recipient;
• ensuring adequate support will be paid in circumstances where there is a real risk of non-payment of periodic support;
• a lack of proper financial disclosure from the payor;
• when the payor has the ability to pay lump sum but not periodic support; and
• immediately satisfying an award for retroactive spousal support.

Similarly, the disadvantages of a lump sum payment can include:

• the real possibility that the means and needs of the parties will change over time, leading to the need for a variation, which will no longer be possible; and
• the inherent difficulties in balancing multiple factors and variables to calculate an appropriate lump sum amount of spousal support.

In the end, it is for the presiding judge to consider the factors relevant to making a spousal support award on the facts of each particular case and to exercise his or her discretion in determining whether a lump sum award is appropriate, and if so, the appropriate quantum of such an award.