What We Do
We know that every family is different and every client has their own unique needs and priorities. In our first interview we want to listen. We want to hear your concerns and thoroughly understand your situation and only then offer our suggestions on how you might proceed. While every family is unique, there are still some broad issues that typically arise in Family Law, such as custody and visitation, child support, spousal support, and disposition of the family home, division of family and business assets, division of pensions, and other miscellaneous matters. Some of these issues are discussed below.
Custody and Access
While it is increasingly common for separating spouses to share equal time with their children, it is still the norm for children to live primarily in the home of one parent, while visiting from time to time with the other parent. Resolving which parent gets "primary care" of the children can be very contentious matter which often ends up in the Courts. However, more often than not the issue is resolved on the basis of which parent has the time to devote to the children. A dad who is working a 60 hour week would have difficulty winning primary care and control of the children from a stay-at-home Mom.
When custody cannot be resolved by negotiation and the matter ends up before the Court, a Judge will often require the wife and husband to participate in an assessment by a social worker or psychologist, who will then prepare a report containing recommendations to the Court on the custody/visitation arrangement to meet the best interests of the children.
Child Support
The Child Support Guidelines determine how much child support is payable. How much monthly child support is payable is determined by the gross annual income on the non-custodial parent. These guidelines can be found at: http://www.justice.gc.ca/eng/pi/fcy-fea/lib-bib/legis/fcsg-lfpae/2011/pdf/mba.pdf
Generally child support stops when the child turns eighteen years of age and the child is no longer attending school on a full-time basis. If the child is attending college or University on a full time basis, then generally speaking the obligation to pay child support continues.
When a child is over the age of 18 years, and is still receiving child support, the Court has the discretion to stray from the Child Support Guidelines under certain circumstances. For example, if the child is working part-time and earning several thousand dollars a year, then it may well be appropriate to pay less child support than is indicated in the Guidelines, as presumably this child can contribute financially to their own upkeep.
Sometimes a child will live half the time in the care of one parent, and then half the time in the care of the other parent. A common approach to resolving child support in such circumstances is to calculate how much each spouse would owe to the other in child support. For example if Ned and Sally have one child who spends equal amounts of time in their respective care, then we can consult the Guidelines to determine how much Ned would be obliged to pay to Sally, as if the child were always in Sally's care. We can then determine how much Sally would be obliged to pay to Ned, as if the child were always living with Ned. The Court would then set off one amount of child support against the other. So if on the basis of Sally's salary, she is be obliged to pay child support to Ned of $412.00 per month, and on the basis of Ned's salary, he is obliged to pay child support to Sally of $557.00, then the net result is that - on a shared custody arrangement - Ned must pay Sally $145.00 per month ($557.00 - $412.00 = $145.00).
Spousal Support
The issue of spousal support is notoriously difficult to resolve, in part because there are so many factors to take into account when assessing the issue, and in part because the Canadian Courts have not always been consistent in awards of spousal support. Generally speaking a spouse is entitled to spousal support when they are in financial need and/or they have suffered a financial disadvantage as a result of the marriage or the marriage breakdown. A person in a common law relationship is also entitled to spousal support on the same general criteria.
In an effort to bring some consistency to the sometimes dramatically different awards of support across the county, the Federal Department of Justice published Spousal Support Guidelines to assist lawyers and the Courts in determining what would be a reasonable quantum of spousal support. The Guidelines are not binding in law. They are really just intended as a "helpful suggestion" from the Federal Department of Justice. Even though these Spousal Support Guidelines are not binding in law, the Manitoba Courts do give considerable weight to these Guidelines and generally regard them as a starting point for determining an appropriate amount of monthly support.
Spousal support is usually paid on a monthly basis. Unlike child support, spousal support is tax deductible. So if Ned is paying Sally spousal support of $600.00 per month, he is able to deduct that spousal support on his taxes. The result might be that from Ned's perspective, he is really only paying Sally $400.00 per month, because a $200.00 tax deduction. Sally on the other hand must pay tax on the spousal support. So even though she receives $600.00 per month in spousal support, the reality from Sally's perspective is that the money is only worth about $400.00, because $200.00 will be paid in income tax.
Many people choose to resolve spousal support by way of a single lump sum payment. This can be beneficial for the parties. For the person paying support it means that there is a complete financial severance. There will be no monthly payments stretching indefinitely into the future. For the recipient of the lump sum spousal support, it can be beneficial to receive their support all at once - perhaps allowing them to purchase a new home, or new car as necessary. The recipient of such lump sum support also receives the money tax free; there is no income tax payable on lump sum spousal support.
The Family Home
Typically family homes are jointly owned between husband and wife. This also means that the mortgage is in their joint names as well. When a couple separate and one person moves out of the family residence, then continues to be a joint owner of the residence and their name continues to be on a very large loan/mortgage to the bank. Unless a separated person is uncommonly wealthy, they will not be able to buy a new house until they have resolved what to do with the old house and the old mortgage. The bank is unikely to lend them money for both their old mortgage and a new mortgage.
Generally speaking there are just three possibilities related to the family home. One person can buy out their spouse's interest in the home, they can sell their share of the home to their spouse, or the property can be put up for sale with a real estate agent and the net sale proceeds divided between the spouses.
For example, if Sally wanted to buy out Ned's one half interest in the family residence, she would likely hire a real estate appraiser to determine the value of the home. Sally was told by the real estate appraiser that the current value of her home is $400,000.00. Sally then asked the bank how much was outstanding on her mortgage. The bank tells her that $160,000.00 is still owing on her mortgage. Therefor there is $240,000.00 of equity in the family home ($400,000.00 - $160,000.00 = $240,000.00). As Sally and Ned are joint owners, it could be said that Sally owns $120,000.00 of the equity and Ned owns $120,000.00 of the equity. But if Sally wants to buy out Ned's interest in the home, she must get a new mortgage totaling $280,000.00. This sum is necessary to pay Ned his $120,000.00 and to pay out the old mortgage of $160,000.00.
Again, the alternative is for Ned and Sally to put the house up for sale. They will hopefully receive $400,000.00 in sale proceeds, from which the old mortgage must be paid out, leaving them with $240,000.00. They would each then get a cheque in the mail for $120,000.00.
Division of Family Assets
The law in Manitoba provides that all assets acquired during married cohabitation (or during a common law cohabitation) are divisible equally between the parties. Any assets acquired prior to cohabitation are excluded from any such division. Similarly any purchases made after separation are excluded from division. For example, Ned loved to collect cars. Prior to his marriage to Sally, he purchased a 1968 Ford Mustang. During the marriage, he bought a 2009 Toyota Corolla. The day after the separation, in an effort to cheer himself up, he purchased a 1962 Galaxy 500. The only vehicle that was the subject of a family property division was the 2009 Corolla, because it was the only vehicle purchased during the period of their cohabitation. But how do you divide a 2009 Toyota Corolla? In this case the vehicle was registered in Ned's name, and so Ned kept the vehicle. But he was obliged to account to Sally for one half the value of that vehicle.
Division of Pensions
Pensions can be among the most valuable assets a separating couple can have. If one spouse has been working and accumulating a pension over the course of 30 years, the pension will be valuable indeed. Manitoba law states that generally speaking, the portion of a pension that accumulated over the course of married cohabitation is divisible equally between husband and wife. It is possible to divide the pension unequally, or not divide it at all, but some very specific steps must take place in order to do that. Firstly, the person giving up their entitlement to share in the pension, must know exactly how much money they are giving up. That information can be provided by the pension plan administrator. Secondly, they must have the benefit of independent legal advice. When they know how much pension money they are giving up, and when they have talked to their lawyer about it, they can then sign an agreement wherein they give up their entitlement to share in the pension.
In some circumstances it makes sense to give up your right to share in a pension. Remember Sally wanted to buy out Ned's interest in the family home. To do so she had to pay out the old mortgage of $160,000.00 and pay Ned $120,000.00. Sally went to the bank and tried to borrow the necessary funds of $280,000.00, but the bank said she did not earn enough money to take out such a large mortgage. Sally was really fond of her home. She had been investing her time and effort and money into that home for two decades and she was not going to walk away from it now. So she proposed to Ned that she would pay him his $120,000.00 by waiving her interest in his pension. This meant that Sally would only need to borrow $160,000.00 from the bank in order to buy out Ned's interest in the home. This proposal pleased Ned, because Sally's love for her home was nothing compared to the passion Ned felt for his pension. So a deal was struck. Ned kept his pension, and Sally kept the house.
