Tuesday, March 28, 2000
'This is about punishing Dad'His former wife gets 96% of his take-home pay. Is that justice?
Donna Laframboise
National Post
Last fall, three Ontario Court of Appeal judges rejected "Michael's" plea to reduce his family-support payments. In their view, there was no reason why he shouldn't continue paying $7,153 to his former wife each month -- $4,153 in child support, plus $3,000 in alimony.
The problem is that this represents 96% of Michael's monthly take-home pay. While the court included a severance package, bonuses and other earnings when calculating his income, the severance was a one-time thing when he switched jobs, and the other items can't be counted on.
From day to day, Michael lives on his annual $158,000 salary. His January, 2000, pay stubs show that, after deductions such as CPP, EI and income tax, he takes home $7,455 a month as the chief financial officer of a prominent corporation. (The National Post has granted him anonymity at the request of his employer.)
After making his court-ordered payments, Michael is left with $302 a month on which to live. In Toronto, even a single man on welfare is allotted more -- $520 a month. Put another way, of every dollar Michael earns, he keeps only 2¢, since 44¢ goes to employment deductions, 31¢ goes to child support and 23¢ goes to alimony.
Michael is not alone. From one end of the country to the other, divorced men are being financially ruined by excessive child- and spousal-support orders made by judges whose grasp of basic economics is weak. What's worse, these judges profoundly misunderstand how the removal of the tax deductibility of child-support payments in 1997 has affected support payers' lives.
Michael is the first to admit that, until recently, he has led a fairy tale existence. Always an overachiever and leader, he has won awards for both sports and academics and is one of the youngest people to make vice-president of a Fortune 500 company.
"I did not wake up six years ago and say: 'Today's the day I'm going to start destroying my life,' " he says. "But that's what happened. It's been a roller coaster, but it's all been down -- financially, emotionally, spiritually and physically. I'm close to bankrupt in all those elements now, and it's 100% as a result of this divorce."
In 1994, Michael, his then wife of 14 years and their three children lived in an $850,000, 9,000-square-foot home with an indoor pool. But the fairy tale began to unravel when his wife served him with divorce papers at the office.
To her credit, she made no unsavoury allegations against him. "Her only issue," he says, "is I never spent enough time with her. And that's a fair comment. I'm a little wiser now and I know the importance of that. But frankly, I was driving my career. You get caught up. We never went into the fact that we were going to put the kids in private school, but there's a price to pay."
Last summer, Michael consulted a trustee in bankruptcy who declared him insolvent, since he's going into debt by $4,000 a month. The bankruptcy report says that when child support stopped being tax-deductible, Michael went from paying no tax on the portion of his income earmarked for family-support payments to paying $3,398 tax each month on this amount.
It is precisely this tax bite that has eaten up Michael's chance at a sustainable life. "I have the greatest bank manager, but he kind of just drew a line in the sand," he says. "I have the greatest friends, but they drew a line in the sand. I have begged, borrowed, I've done everything I can. I've got three mortgages on [a modest $239,000] house that I've never had before. I've got a line of credit that's at the limit. I owe Revenue Canada, I owe Visa. I'm at a loss."
Nor can it be argued that Michael's former wife is suffering financially. One thousand tax-free dollars a week is such an obvious windfall that the Ontario Lottery Corp. runs a lottery in which this is, in fact, the prize. Not only does his former wife receive more than $4,000 in tax-free child support each month, she gets an additional $3,000 in spousal support. This adds up to $85,836 a year. Put another way, her income from Michael is roughly equivalent to that of someone paid a fully taxable $125,000 a year in the workforce.
Last December, she purchased a $375,000 home. According to her 1996 tax return, that year alone she donated $21,385 to charity.
Michael is trying to have the matter reheard in court but says, "Everything gets adjourned and there's always a legal reason why a motion can't go forward. This was supposed to go to a motion back in November and then it was set for December and then it was January. Now it's I don't know when."
The stakes are enormous. "I'm a chartered accountant," says Michael. "If I go bankrupt I lose my CA, then I lose my job. And even with one of the best lawyers in the country, I can't get anyone to deal with this."
Although last year's court of appeal ruling appears to take into account Michael's present circumstances, his lawyer was prevented from telling the judges about the bankruptcy report and from showing them Michael's pay stubs because there are strict rules about introducing new evidence at the appeal level.
Between them, the three judges apparently failed to realize how their ruling would translate in the real world. When Michael's financial ship sinks, his former wife's standard of living -- and that of the children -- will be profoundly affected. How anyone will benefit should the entire family find itself dependent on social assistance is a question no one seems to have asked.
In the past six years, Michael has occasionally fallen behind in his support payments. He says the highest his arrears have risen at any one time is $14,000. Nevertheless, his children are apparently being encouraged to think of him as a deadbeat.
"I talked to my 16-year-old son when [a recent Toronto Star article on deadbeat dads] came out. You know what he said to me? He said, 'Dad, did you read that article in The Star? Well that's what I think of you.' "
Regarding the appeal court decision, Michael says, "When you read [it], I'm scum. It comes across as, 'Here's this guy that's trying to circumvent the system.' The facts are I've paid $535,000 in support in the past six years. The facts are my kids are in private school and I pay for it. The facts are this woman lives in a $375,000 house that I bought. The facts are I work 70-hour weeks, and she has made almost no attempt to become self-sufficient.
"There's enough money to have a good life for everybody with what I make. I want to pay support. They're my kids and I want what's best for them. I want them to have a nice home. But the support has to be reasonable and fair."
Michael also points out that his reasons for getting up in the morning and striving at his high-performance career are becoming hazy. "I need to have hope and ambition and motivation. And this system discourages that. I have no hope. I'm not here to whine. I'm just here to tell what's happened to my life."
The stories are remarkably similar across the income spectrum. In 1997, Denis McKenzie, a Winnipeg postal worker, had a take-home pay of $1,900 a month after quitting a supplementary part-time supermarket job during an ugly divorce that included false sex abuse allegations against him. Having been ordered to pay $2,000 in monthly child and spousal support by one judge, he was forced on to welfare until another reduced his payments to a more manageable $910.
Wayne Archer, a firefighter living in Caledon, Ont., says that a 1991 child-support order for $750 a month for his son "represented 91% of my net pay at the time." (Part of his income was being deducted to repay an employer-sponsored loan.) "In desperation, I bought a camper and put it on the back of my pickup truck. I lived in that with my German shepherd for a year and a half during the coldest winter in 80 years. It was minus 21. The dog's water froze on the floor. Twelve-volt power, a cell phone -- that was my life."
In the mid-'90s, Dr. Robert Wright, a Clearbrook, B.C., dentist fled the country after serving jail time for failing to pay alimony. Although his payments of $900 a month for child support were up to date, in 1993 Wright ceased paying the monthly $2,500 ordered by the court in spousal support. At a trial late that year, a bankruptcy specialist with a prestigious accounting firm testified that Wright was a bona fide bankrupt. The judge rejected this evidence, finding Wright in contempt. He sent him to jail for 60 days.
Katherine McNeil, a child custody consultant who advocated on Wright's behalf, says "Dr. Wright made every effort before going bankrupt to get into court and have the court order reduced by the amount of spousal support only, not the child support. He was repeatedly thwarted by adjournments."
Even though his marriage had ended seven years earlier, few people seemed troubled by the fact that Wright was still expected to support his former wife. In 1993, he told the media that she "has been living with a local businessman for over three years in a very comfortable home with a minimal mortgage. They drive recent-model vehicles and have tropical vacations."
It didn't matter, remembers McNeil, "what the facts were. The courts and the support enforcement agency seemed intent on destroying this man and what remained of his relationship to his three children."
Since 1997, when federal child-support guidelines were put in place and child support stopped being tax-deductible, matters appear to have deteriorated. "My constituency office has received an extremely large number of constituents requesting our assistance in this particular area," wrote an Oshawa, Ont., MPP last year. Since May, 1997, "our office is hearing more and more of tragic financial situations for many support payers."
In British Columbia, MLA Linda Reid, the Liberal opposition's critic for children and families, agrees. "There's just some horrific stories out there. Folks are in my office on a regular basis. They're absolutely committed to doing the right thing for their offspring but they just cannot, for myriad reasons, make the system work for them. The national guidelines that came down in terms of what monthly support should look like, I don't take any issue with the content of that, but there's no flexibility."
Among the biggest flaws is the fact that these child-support guidelines are based on gross, rather than net, income. Judges use a table to determine how much a payer owes based on his income and the number of children involved. Many judges, however, then slap alimony on top of this -- ignoring the fact that a person who is mandated by the courts to pay alimony has a smaller pool of money from which to draw than his gross income on a table would suggest.
Another problem is that, as happened in Michael's case, judges estimate what a payer's income is likely to be, and base support awards on this amount. His ex-wife's lawyer, he says, has "always argued that I have an ability to make a lot more. Well, based on bonuses. But if people are on bonuses or commissions, their income is not guaranteed. So why is support guaranteed? I've recommended for six years now that they base it on my base salary and I'll pay some portion of the bonus when and if I receive it."
In the case of Denis McKenzie, when determining the postal worker's income, the judge added an additional $300 a year he would earn if he delivered extra flyers -- thus turning an option of earning more money into an obligation.
In other instances, courts have determined support payer's gross incomes by including overtime earnings in the calculations -- thereby locking these men into working long hours year after year.
Susan Baragar, a Winnipeg lawyer, points out how far such "deeming" of income is taken by the courts. "If I had a divorced dad who had a job and then quit because he didn't want to pay child support, you can be darn certain that the courts would deem income to him based on what his pay used to be. So if you're a man you're not allowed to go out and quit your job.
"But I've had a case where a woman had a $31,000-a-year job, went on maternity leave, came back and didn't like that job anymore. She thought she'd like to start her own business instead, so her income was reduced to zero -- and she didn't have to pay child support."
Indeed, instances in which judges have instructed men to pay regardless of their employment situation are common. In 1995, an Ontario police officer who routinely responded to family-law situations, took a leave of absence because, he said, he was having difficulty performing his job after experiencing first-hand the anti-male bias of the family courts.
"My sworn duties as a police officer demand that I perform those duties without discrimination," he wrote in an affidavit. "Frequently, I have advised disputing parents to consult with a lawyer to seek a fair and reasonable resolution in the family court. Given the discrimination I have been subjected to by the court [in his own divorce proceedings] I can no longer give that advice. I cannot at this time perform those duties in a fair and unbiased matter."
Deaf to his moral dilemma, Judge Kenneth Langdon called the leave of absence "a transparent and contumacious attempt to subvert the court order for support." Not only did the judge make a new order directing the officer to "take all necessary steps and do all necessary things to terminate his leave of absence and resume regular police duties immediately," he expressly forbid him from quitting his job or accepting an early retirement package. Ten months later, a second judge, Gladys Pardu, agreed that the leave of absence was "a reckless and retaliatory action by the husband."
Still another problem with the child-support system comes in the form of add-ons. While it's one thing to be assessed a given amount of support according to a government table, many men have discovered that child support can extend beyond that. Stan Gal, a divorced father described in yesterday's National Post, was ordered by a judge to pay $117 in monthly support above the guidelines for his adult daughter's university tuition.
While the guidelines indicate that Michael's monthly child support contribution should be $2,953, his ex-wife has been awarded an additional $1,200 a month in "extraordinary expenses for the children's education."
Edward Kruk, a social work professor at the University of British Columbia, says non-custodial parents are often ordered to pay twice the guideline amount or more. "With preschool children, a lot of dads who are asking for parenting time with their kids are being denied that and the kids are ending up in a daycare setting that fathers then have to pay for as special expenses," he says. "So suddenly the father's paying $1,000 a month -- $500 for the guideline amount and $500 for daycare costs."
This was not supposed to happen. Indeed, the federal-provincial task force that developed the guidelines argued, prior to their implementation, that "This method of determining the costs of children produces higher estimates of those costs than other methods, in part because it assumes to include all expenses, including daycare, and to apply to children of all ages."
A 1998 Senate report says there is "widespread confusion" among judges and lawyers over what kinds of expenses qualify as special or extraordinary. "The case law itself is taking completely contradictory views," reads the report. "Some judges apply an objective test, others a subjective test."
Finally, even the guidelines themselves are being challenged. Mike LaBerge, president of the Calgary chapter of the Equitable Child Maintenance and Access Society, argues that child support payments often dramatically exceed the actual costs of raising a child.
According to 1999 figures published by the Manitoba Department of Agriculture (the only government body in the country to compile such data), it costs $5,500 a year to raise a school-aged child, and up to $8,500 per year for a child attending daycare.
Alan Mirabelli, executive director of the Vanier Institute of the Family, confirms these are reasonable estimates of what parents can expect to spend on a generic child. Families with less money, he says, will obviously trim their costs by buying less expensive sneakers. Those with more will send their kids to pricey summer camps not reflected in these estimates.
Michael pays $16,600 a year for each of his three teenagers. Wayne Archer, who was reduced to living in a camper, pays $9,000 a year for his teenaged son.
LaBerge says that when you consider that these amounts represent "only one parent's share of the costs," our child support system appears to have been designed not merely to ensure that children's needs are met, but to transfer income from divorced fathers to divorced mothers.
"This is a legally imposed form of social welfare that you have no way out of," says LaBerge. "This is about punishing Dad, about making him pay.
"What you have to tell people is that these policies will hurt their boy. With divorce rates approaching 50%, their son has a one in two chance of being victimized by this system. Everyone says child support is about feeding the children, but it's not."
WHY MICHAEL KEEPS JUST 2 CENTS OF EVERY $1 HE EARNS:
Michael's gross pay for January 2000: $13,200.00
Minus deductions: *5,745.02
Net pay: 7,454.98
Minus child and spousal support: 7,153.00
What's left for Michael: $301.98
*DEDUCTIONS:
Income tax: $4925.38
Canada Pension Plan: 477.92
Employment insurance: 300.00
Long-term disability: 36.72
Social fund: 5.00
TOTAL: $5,745.02
WHAT HAPPENS TO EACH DOLLAR MICHAEL EARNS:
To standard employment deductions: 44 cents
To child support: 31 cents
To spousal support: 23 cents
To Michael: 2 cents
Sources: Michael's End of January 2000 Pay Stub and a 1999 Ontario Court of Appeal Decision
RELATED SITES: (Each link opens a new window)
FATHER FRIENDLY ORGANIZATIONS A well funded, well organized American lobby group. An organization devoted to encouraging involved fatherhood. Strategies for men going through divorce. Devoted to the well being of children from separated and divorced families. This site promotes the philosophy that = the best parent is both parents. Attempts to assist non-custodial parents with divorce-related problems. Devoted to educating and supporting fathers A U.S.-based online community for step moms and second wives. A site dedicated to issues affecting non-custodial parents. FATHER FRIENDLY RESOURCES An American site geared to solving problems outside the courtroom, via mediation. Alberta-based on-line magazine. A great research paper that critiques the guideline approach to child support. Run by Carey Linde, a Vancouver family law lawyer. An online magazine devoted to men's issues. Resources put together by Gene Colman, a Toronto family law lawyer. An American men's movement magazine. Run by child support expert Roger Gay. The personal web site of National Post journalist Donna Laframboise OTHER RESOURCES A division of the Department of Justice, with links to Child Support guidelines and legislation. The provincial body that administers and enforces support agreements in Ontario. The site lists many of the means by which agencies chase support payers who are in arrears. An American advocacy group for child support professionals. At the bottom of this page is a series of useful studies on child support, including a pair on using private agencies to collect payments. November 1997 study compiled by the Department of Justice. Contains minutes of all meetings. Federal government agency mandated to promote gender equality. A large Canadian-based site with comprehensive links to family law guidelines and legislation.
Advocates the dismantling of the adversarial system in Canadian family law. This page put together by a Canadian coalition of women's organizations discusses reactions to the Special Joint Committee on Custody and Access. Links to the dissenting reports of the Reform, NDP and Bloc Quebecois parties. A brief look at the issue of spousal support and how the law treats it.
"Works to assure children meaningful and continuing contact with both their parents."
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