Fix the law on spousal support and retirement
More clarity helps everyone, Alexandra Kirschbaum says.
In Ontario, and Canada more broadly, we are lucky to have a progressive, well thought-out family law system. Our law is child-focused and evolving with the times. There is, however, one area of family law that sorely needs reform: the law of spousal support, particularly in relation to retirement.
When two married people separate, an assessment is typically undertaken about whether there is entitlement to spousal support. In our system, entitlement exists in three categories. It can be compensatory. That means that entitlement arises because one person made financial sacrifices for the benefit of the other, as would be the case in a long-term marriage where one person stayed home to raise children while the other focused exclusively on their career. Entitlement to support can also be needs-based, as would be the case where, although no financial sacrifices were made by either party, one party does not have enough money to support themselves. And entitlement can also be contractual.
Our system is complicated by the fact that in contrast to child support, we do not have mandatory guidelines for spousal support. Finding entitlement is a discretionary exercise for the judge. So is determining how long spousal support will be paid, and in what amount. We do have the Spousal Support Advisory Guidelines, but their implementation is not mandatory. The lack of clearer rules around how long a support order can last creates tremendous litigation uncertainty, making it hard for lawyers to predict the correct outcome or settle cases. The situation is not helped by the fact that on some issues, the existing cases contradict each other, making it harder for lawyers to accurately predict outcomes.
Enter retirement. In our current system, the only way to change spousal support at
The spousal support laws on the books today were designed in another era.
retirement, if you cannot agree, is to litigate. Existing cases are not clear on whether attaining the age of 65 constitutes a change of circumstances that would warrant a change to spousal support. Sometimes it does, and sometimes it does not. A person who is retiring, whose former spouse does not agree to a change of arrangements, has to apply to court to have their situation determined after they have retired. And they have to accept the financial risk that the judge may reject their assessment of the situation, which means they may pay not only their own legal fees, but also those of their former partner. This is an unacceptable level of financial risk for a population with limited resources. And there are ways that we could fix this problem.
We could codify the treatment of RRSPS, pensions and other retirement savings that have been divided at separation, making it clear how retirement income can be calculated for support purposes. We can make it mandatory for courts to set fixed termination dates when support orders are made, and to comment, at separation, on the extent to which they have addressed the issue of retirement. We can clarify how the law operates in respect of serious illnesses and their impact on spousal support. And we can devise a reference system, where in the event of a dispute on support in the context of retirement, people can apply to court to have the issue decided one or two years before they retire, not after. People have the right to know how the court will adjudicate their support payments before they give up their employment income. It is not fair that in the current system, you have to pull the trigger and retire before the court will rule on your rights.
The spousal support laws on the books today were designed in another era. Enough time has passed to see the ways in which they do and don't meet the needs of contemporary society. “Grey divorce” is on the rise. Reforming spousal support law to bring more clarity to retirement cases would assist the vulnerable, reduce the court backlog and give us another reason to feel good about how family law functions in our country.