">
In family law litigation, parties can end up with financial responsibilities to one another. In some cases, one may seek to set off common debts by deducting an existing debt owed to the other party from a new debt. However, in family law, not all debts are treated the same. Courts have been reluctant to offset inter-spousal debts against child support payments owed by the payor parent out of concern that children may be disadvantaged. Despite this, setting off spousal debts against child support may still be appropriate in some cases.
Courts Have Been Reluctant to Set-Off Debts Against Child Support
In Pascual v. Pascual, the applicant owed the respondent $6,207.20 for retroactive child support, while the respondent owed him more than $98,000 in costs. He requested the court set off the costs awarded against his retroactive child support obligation. The judge acknowledged that Canadian courts have been reluctant to offset costs or debts between parents against future child support payments. In part because child support is regarded as a right of the child. In Lutz v. Lutz, the Ontario Court of Appeal held that a trial judge lacks jurisdiction to set off a debt owed to the payor parent against future child support that they owed.
Some courts have been more flexible in their approach to the issue. The Nova Scotia Court of Appeal suggested a less rigid approach in Barkhouse v. Wile. In that case, the court cited D.B.S. v. S.R.G., which emphasized the primacy that was accorded to child support by legislatures and courts. For example, the court noted that child support enjoyed a preferred status as a debt owed by the payor. In Barkhouse, the court accepted that “as a general rule, setting off a spousal debt against child support is undesirable and is to be avoided”. However, some cases may have circumstances in which it would be appropriate. The court indicated that where:
- the debt involved was incurred in connection with the support claim;
- there is no reasonable prospect that the payor spouse will collect costs from the defaulting payee spouse;
- there would be no adverse impact on the children involved;
- it would not otherwise be inequitable to order a set-off,
then it could be appropriate to set off child support against costs associated with litigating the issue. The court indicated that the burden of showing that there would not be any adverse impact on the children should fall on the party seeking the set-off. Nevertheless, the court indicated that it should remain a matter of discretion for the judge to decide the extent that which any set-off should be ordered.
Judges Outline When Set-Off May Be Appropriate
In Woo v. Chin, Justice Herman emphasized the distinction in ordering a set-off of child support arrears rather than prospective child support. The judge suggested this derived from “a consideration that, in the case of an award for arrears, the award may not directly benefit the child, but rather, maybe compensation to the parent for expenses that have already been incurred.” The judge found the same logic could apply to an order for retroactive support. Justice Petersen, in Pascual, agreed but warned that the set-off of costs against a retroactive child support order still needed to be limited to “exceptional cases.” Yet, this was one of those cases. The costs owed to the applicant were substantial and connected to the child support litigation.
Additionally, it was the respondent’s own unreasonable conduct that led to her award of high costs. The judge also determined that there was little likelihood that the applicant would ever be able to recover the full amount of the costs that were owed to him. Most importantly, there was nothing to suggest that the children would be harmed or disadvantaged if the debt for costs were set off against the applicant’s retroactive support payments. In these circumstances, the set-off was appropriate, and the applicant was not required to pay anything for retroactive child support.
Courts Distinguish Between Ongoing and Retroactive Child Support
In M.B. v. A.F., the father owed child support arrears of $5,563.37, with the mother owing costs of $15,000.00 to the father. The father requested that the mother’s costs be offset against the child support arrears. The judge began by considering whether there was jurisdiction to order a set-off under section 111 of the Courts of Justice Act. The judge determined that although there was jurisdiction, it was unclear whether it was appropriate. Justice Finlayson looked to Justice Martin’s concurring opinion from the Supreme Court of Canada case of Michel v. Graydon. There, she spoke of child support being the “right of a child” to protect the “financial entitlements due to children by their parents.” Looking back to the 1994 case of Willick v. Willick, the court wrote that children needed to “be sheltered from the economic consequences of divorce”. For Justice Finlayson, the weight of the previous caselaw suggested that while child support may be paid to the recipient parent, “it is paid for the benefit of the child and therefore should have some special or different treatment.”
The judge turned to the question of whether courts should order set off. In M.P.A.N. v. J.N., the judge noted that courts had examined the set-off of costs orders against prospective support orders, against arrears, or other family law obligations. When a party seeks to set off costs against ongoing support, some judges have refused to order set-off out of a concern that an order may end up harming the child or depriving it of support. Overall, courts appeared more willing to order set-offs against child support arrears than ongoing child support.
In Peers v. Poupere, the judge took a flexible approach rather than maintaining a “bright white line” around child support obligations. Looking at the reality of how parents live their lives, Justice Spence noted that for most parents, support payments are not likely to be maintained separately, and instead, it is likely that “all money received is simply pooled into “general” revenues, out of which they pay their expenses.” And “it is out of that same pool that a parent would then have to satisfy a court-ordered costs award.” Moreover, Justice Spence suggested a firm prohibition against set-off orders could give support recipients a license to conduct litigation unreasonably with impunity from costs orders. In M.B. v. A.F., the judge did not decide whether to set off costs against future child support. But Justice Finlayson was prepared to make the more limited set-off the father requested.
Judges Have Shown Flexibility in Setting Off Costs Against Retroactive Support
Courts have found that setting off spousal debts against child support owed by the payor parent may be permitted in exceptional cases since child support is the child’s right. However, courts have distinguished between prospective and retroactive child support and have indicated that an offset may be permissible against retroactive support orders.
Experienced Windsor Family Lawyers Assisting with Child Support and Parenting Plans
The family lawyers at Johnson Miller Family Lawyers in Windsor focus exclusively on family law matters for clients in Windsor-Essex County and internationally. As part of our child support and parenting planning services, our team works with you to determine financial solutions that are tailored to your needs. To discuss your matter further or arrange a consultation, contact us at 519-973-1500 or online.
