In Colucci v Colucci, 2021 SCC 24, the Supreme Court of Canada decided that courts can reduce child support arrears if a parent was asked to pay too much in the past or if they cannot currently pay. The court set high standards for parents seeking to prove financial hardship. It then denied a father’s request to have his child support lowered, because he did not meet these standards.
A mother and father separated after 13 years of marriage. The trial court ordered the father to pay $230 in child support each week to support their two children. The father did not pay child support for over 16 years. Instead, he spent years outside Canada and avoided filing taxes. In 2016, the father applied to have his child support arrears forgiven. The father claimed he could not afford to pay $170,000 in arrears, but he did not show documents proving this.
2. Previous Court Decisions
3. Supreme Court Decision
The Supreme Court of Canada agreed with the Court of Appeal and ordered the father to pay $170,000 in child support arrears.
4. How to Reduce Child Support Arrears if a Parent was Asked to Pay too Much
Change in Income
The first step to reducing child support arrears is to show that the parent’s income had changed. To do so, the parent must prove that :
- their income lowered significantly,
- for a long period, and
- that this change was out of their control.
The Three-Year Rule
If the parent can show a long-term change in income, a court may agree to decrease past child support. Usually, courts will only allow decrease child support arrears starting from the date that the paying parent notified the recipient that they were applying to have their child support decreased. The paying parent must give informal notice no more three years before giving their formal notice of an application to vary child support arrears. Normally, courts will not reduce child support arrears that date back more than three years.
To decide whether it will make an exception to the three-year rule, courts look at four factors:
- If the parent has an understandable reason (for example, a health problem) for not giving notice or applying to court on time.
- If the parent showed good faith and honesty when disclosing their income. An example of good faith and honesty would be that the parent voluntarily paid what they could.
- If the child experienced or experiences hardship after the parent could not to pay the appropriate amount of support.
- If the parent will experience hardship by paying such a high amount of child support arrears. If this parent did not willingly disclose their income, hardship will not likely be accepted.
These factors are difficult to establish, so the three-year rule normally applies.
How to Calculate a Child Support Reduction
If a court decides that it should lower child support arrears during a specific time period, it must calculate the amount that the paying parent still needs to pay. To calculate this, the court looks at the parent’s actual income during this period to find out the amount of child support that should have been ordered.
5. How to Lower Child Support Arrears if a Parent Cannot Currently Pay
If a parent falls behind on their child support payments, they can ask to have the arrears lowered or forgiven due to financial hardship. To argue hardship successfully, the parent must show with sufficient, reliable documentation that they cannot, and will not ever, be able to pay their arrears.
This is not an easy argument to make. A court will first look at all other options– such as a flexible payment plan or a temporary suspension of payments. Courts will only forgive arrears in special cases, such as a major medical issue.
6. The Court’s Decision: The Father Must Pay the Arrears
The Supreme Court of Canada ordered the father to pay the full amount of $170,000 for four reasons:
- The father did not disclose his income for the years in which he wished to lower arrears. The Court had no way to calculate the correct amount of support he should have paid during that time.
- The father did not provide effective notice to the recipient.
- Three years had passed and the father could not prove why he deserved to have his arrears from more than three years ago lowered.
- The father did not disclose his current finances, so the Court could not determine if the father was currently unable to pay the arrears.
This case illustrates the importance of disclosing income on time:
- If a paying parent’s income changes, they must document this change and must promptly notify the recipient that they intend to apply to have child support lowered. If they wait too long, they may still have to pay the arrears, even if they were ordered to pay too much.
- If the payor parent does not, and will not ever, have the funds to pay their arrears, they must disclose their income. However, courts hesitate before forgiving arrears – they will attempt flexible payment plans and other alternatives before freeing a parent from this obligation.