Retroactive Child Support: Should you be Worried?

The recent Supreme Court of Canada decision, Michel v Graydon, 2020 SCC 24  is likely going to cause late night anxiety for some parents as the Court determined that, no matter how old the “children” are, parents may still collect unpaid child support from the other parent.  

In Michel v Graydon, the Court unanimously ruled that a British Columbia father must pay $23,000 in retroactive child support to his former common-law partner and child, even though the “child” is now 29 years old.

The Court held that child support is a right that belongs to the child, it is not something that parents can negotiate away. Child support should provide the child with the same standard of living they had prior to parental separation. Payments required of a parent must be reasonable when taking payor income into account. Back payment orders, or retroactive child support orders, hold parents accountable to responsibilities they may have neglected.

The judges in Michel v Graydon unanimously agreed that the prevention of retroactive child support places a disproportionate burden on women as caregivers. The Court further noted it would be wrong to create an incentive by granting payor parents immunity after the child ceases to be “a child of the marriage”.

“The courtroom doors should not be closed because certain categories of debt owed to children are classified as coming too late”.

The Supreme Court was clear in their message to parents who knowingly avoid or diminish their child support obligations, payor parents will no longer profit from bad behaviour.

Should you have any further question about collecting retroactive child support, or need advice on your family law matter, please contact Robertson Stromberg LLP.

 

Call for feedback on behalf of the CBA

James Steele is Legislation and Law Reform Director of CBA Saskatchewan.

Comments are invited on the SK Government’s ongoing development of Regulations to support The Financial Planners and Financial Advisors Act.

CBA Members are welcomed to review the Ontario draft regulations and offer any comments on said Regulations (insofar as such Ontario Regulations will form the basis of the Saskatchewan regulations). The Ontario draft regulations may be found HERE. Any comments on the above Regulations can be submitted to James Steele at [email protected] by Oct 31, 2020.

Saskatchewan Estate Litigation Update

An interesting recent estate litigation decision out of Saskatchewan is Leason v Malcolm, 2020 SKQB 102.

Leason reminds us that once a  bequest is vested, it may not be divested. In other words, if a beneficiary survives the testator, but the beneficiary then dies before actually receiving their share of the estate, the  beneficiary’s estate will still be entitled to receive the share.

Background

In Leason, the deceased was one Donald Aronetz who died on September 9, 2018. At issue was a gift that his Will made to Jennie Leason. Jennie Leason then died on December 24, 2018, some 15 weeks after Mr. Aronetz had died.

Facts in Leason

Under estate administration law, the bequest to Jennie Leason in Mr. Aronetz’s will would have taken effect (would have vested) on the date of his death, September 9, 2018, when Jennie was still alive. Her subsequent death would have made no difference to that circumstance, and her share of the estate would be payable to her estate.

The bequest in Mr. Aronetz’s will, however, was unusally worded. It read as follows in paragraph 2:

2. … I gift my estate in equal shares unto any SURVIVING siblings, who at the present time are named as follows: (a) Jennie Leson [sic] …, (b) Anne Malcolm …, (c) John Aronetz …, (d) Lillian Whitfield …, (e) Mike Aronetz …, (f) Nick Aronetz …. In the event either of these siblings predecease me or die before having benefited in whole or in part from this my estate, I direct any such undistributed share shall NOT be redirected unto any spouse or child of such a deceased person, rather such an undistributed share shall be equally redistributed amongst the remaining SURVIVING siblings. I have not mentioned any other siblings who have already predeceased me, as this is consistent with my wishes to gift only unto surviving siblings.

[emphasis added]

The respondent applied for letters probate in Mr. Aronetz’s estate in December 2018, while Jennie Leason was still alive, and the executor of Mr. Aronetz included Ms. Leason in the list of beneficiaries of Mr. Aronetz’s estate. The executor however received the grant of letters probate in Mr. Aronetz’s estate in January 2019, after Ms. Leason had died. The executor had not distributed any part of the estate to Jennie before Jennie died.

The issue before the Court was whether the estate of Jennie Leason was a beneficiary of the estate of Donald James Aronetz.

In light of the above provision in paragraph 2 of Mr. Aronetz’s will, the executor of Mr. Aronetz’s estate took the position that Ms. Leason is no longer a beneficiary of Mr. Aronetz’s estate.

The Decision of the Court

The Court interpreted clause 2 above as providing for:

  1. a gift to vest on Aronetz’s death; and
  2. if there was a subsequent death of a beneficiary, before distribution, the gift would be divested.

The Court then turned to consider whether this testamentary intention should be enforced?

The Court held that such intention was contrary to the established legal principle that once a bequest is vested, it cannot be divested. As such, the above provision of Mr. Aronetz’s Will was not enforceable. The Court concluded as follows:

[30]         I conclude, then, that in law a testamentary direction that purports to reverse a gift that earlier had become effective is not enforceable. Put another way, a bequest once vested may not be divested.

[31]        The bequest to Jennie Leason, in Mr. Aronetz’s estate, was effective at the moment of Mr. Aronetz’s death. The gift vested – was de jure receivable – on his death. Ms. Leason’s subsequent death, before she actually received any part of the estate, does not affect the full vesting of her interest in the estate at the moment of Mr. Aronetz’s death. Mr. Aronetz’s direction that in such a circumstance Ms. Leason’s share should go to the other named beneficiaries, rather than to her estate, is not enforceable. 

As such, the Court held that the estate of Jennie Leason was indeed a beneficiary of the estate of Donald James Aronetz, and entitled to receive the gift as if the gift had in fact been distributed to Jennie during her lifetime.

Legal costs:

As an interesting aside,  the Court awarded full indemnity (dollar for dollar) legal  costs to both sides. Their full legal costs were thus payable out of the estate of Donald  Aronetz.

The Court noted the entire court application had been necessitated by the provisions of Mr. Aronetz’s will, and by no fault of the executor, nor the fault of the heirs of Jennie Leason. The Court held that it had been reasonable for the applicants to bring the application, and it was reasonable for the respondent to oppose it.

As such, Leason also serves as a reminder to ensure that a Will is carefully drafted. This will better avoid the risk that a court proceeding may be required to give effect to your Will (as such court application may dilute your estate through awards of legal costs).

 

James Steele’s preferred practise area is estate litigation, including will challenges, executor disputes, power of attorney issues, etc. Contact James Steele at 1-306-933-1338 or [email protected]. The above is for general information only. Parties should always seek legal advice prior to taking action in specific situations. 

Whether it’s personal or business, we handle cases ranging from wills to overseeing complex business deals, and everything in between. Our success comes as a result of our collective effort. Combining the experience of your lawyer together with the resources of our team, you can put your trust in us to handle your case with confidence.

Month: October 2020