Child Support Court Challenge: Parents Wait for Decision

By Rob Armstrong

As the author of a federal petition to update the Canadian child support guidelines, I was invited to attend the court challenge to the guidelines via WebEx in Alberta last week (December 2-4, 2020).

The case was put forward by a team of lawyers and economists that has been tenacious in pursuing this challenge for seven years.

The federal government’s Department of Justice (DOJ) has thrown up procedural roadblock after procedural roadblock rather than hearing the case on its merits which arguably should not be the role of the DOJ.

As I sat listening to their arguments for and against changing the guidelines I could not help but feel like I was watching a scene out of the Lord of the Rings. The Ents were taking forever to decide if they should take action meanwhile the orcs were destroying Middle Earth.

You see, the court described the case as interesting when considering if the guidelines are Ultra Vires (“beyond the powers”) of the federal government, and how fascinating it was that this might be one of the first cases to really test a precedent set by Vavilov this year that defines a framework for the level of judicial review for administrative matters such as this.

Meanwhile, in Middle Earth, millions of dwarves, elves, hobbits and men were being crushed by the orcs.

About a million hard working Canadian parents are classified as a Non Custodial Parent or NCP under the guidelines. This means that for more than 20 years, half of the divorcees are treated identically to irresponsible  parents who flee the country and are never heard from again.

An NCP with two children pays based on an unforgiving ratio of 1.7 / 1 under today’s guidelines. On top of this, the guidelines wilfully ignore all government benefits, and forgets that people might be divorced more than once. 

Most children generally think of each home as equally important, and each parent as equally important. But because they may spend a few extra days in one home, one parent becomes the NCP and will have one half of the after tax income than the other parent. One parent cannot provide the children with everything they need and the other parent can. The child’s standard of living is much higher in one parent’s home than the other due to the guidelines.

We have a system of winners and losers that is harming millions of middle class parents every month, and the very children the system is supposed to be protecting.

For me, I know I have more in common with my custodial parent friends than I do with a parent who fled the country.

What happens if the NCP has the children an extra day or two each week? Everything changes. This is why so many families are duking it out in the courts over schedules. 

The DOJ defense firmly asserted that in 1993 (more than 20 years ago), a Statistics Canada formula which was made up for an unrelated low income study, was the standard and the trusted source to use. The DOJ pointed to the fact that in a 1989 Statistics Canada paper it claimed that they used real data – but you won’t believe this – no one can find the 1989 paper! The only thing we know for sure is that Stats Canada has claimed themselves that the formula was arbitrary and they could have chosen anything.

Let all this sink in for a second. A million Canadian parents are struggling under the guidelines while the DOJ is putting forward arguments maintaining the guidelines are based on a (so-called 40/30 formula) footnote in a lost paper from 1989. You could not make this up if you tried.

The DOJ, rather than looking holistically at the guidelines and arguing about their overall fairness, put forward a large number of petty attacks aiming to poke holes in the applicants’ factual case for reforming the guidelines. 

The DOJ claimed, after admitting that all aspects of the guidelines favour the custodial parent, there was one aspect that did not – the presumption of equal income. However, it was later shown that this claim is illogical because when used in the formula, this assumption actually increases the payment to the custodial parent. 

Another unusual suggestion from the DOJ defense was this: all of the options are flawed so why not just go with this one?

Thankfully the applicant’s lawyer, Ms. Harper did an excellent job of showing how the defense not only was incorrect in their characterization of the issues, but furthermore many of their arguments were circular arguments which pointed at flaws in the 40/30 model itself. 

It wasn’t clear why the DOJ defense relied almost entirely on the affidavit of law professor Dr. Rollie Thompson rather than an economist.  The defense suggested that perhaps the applicant shouldn’t have used after tax dollars in their economic critique, as if to suggest that Canadian parents can spend anything other than after tax dollars. This may be a reasonable choice from a purely logical perspective, but it wouldn’t be a reasonable economic assumption.

Similar problems with the defense surfaced when they suggested that money provided to custodial parents from government programs such as the Canada Child Benefit shouldn’t be considered as part of the family budget. As all families know, a dollar is a dollar and they all spend the same. And if you look at it from an economist’s perspective, that assumption either means that these payments free up dollars the custodial parent would otherwise have spent on the children, or the custodial parent is overpaid for the children beyond what the 40/30 formula intends. If the custodial parent is overpaid (beyond the 40/30 calculation), the issue of how to classify the overpayment arises. In any case it points to issues with the guidelines.

As a parent I thought what was missing entirely was a 10,000 foot view of how unusual this classification of CP and NCP is. They are just two parents, one with slightly more than 60 percent of the access. 

I also felt that they could have spent more time discussing alternative models that use brackets or ratios to reflect the costs of each parent based on their parenting time. The federal government has used brackets for calculating income tax for years and a similar bracketing system could be used when calculating child support.

As a Canadian I expect more from my government. I want them to be discussing how to best make the model work for all families in policy sessions rather than exhausting every legal defense that is available. 

Unfortunately we will have to wait a few weeks to find out the final judgement. Both sides seem likely to appeal the decision regardless of the outcome which means we should be prepared for Middle Earth to burn for another year.

If you want to support this challenge, please visit the website here.