British Columbia Family Law Blog

  The court reviewed the law of support as set down by the Supreme Court of canada and held:

e)       Moge, Bracklow and Related Authorities

[48]            The leading authorities which are almost invariably referred to in cases involving spousal support are Moge v. Moge, [1992] 3 S.C.R. 813, and Bracklow v. Bracklow, [1999] 1 S.C.R. 420.

[49]            In Moge, Madam Justice L'Heureux-Dubé, speaking for the majority (McLachlin J., as she then was, wrote separate concurring reasons), made it clear that the objective of self-sufficiency was not to be given overriding significance in determining the entitlement to spousal support, its quantum or duration.  At p. 853, she also stated that:

It is also imperative to realize that the objective of self-sufficiency is tempered by the caveat that it is to made a goal only "in so far as practicable".  This qualification militates against the kind of "sink or swim" stance upon which the deemed self-sufficiency model is premised.  [Citations omitted.]

[50]            The limited-term order made in this case reflects an aspect of the "sink or swim" philosophy and assumes that Ms. Tedham is capable of swimming; that is, of making her own way without relying on Mr. Tedham for support.  While she has proven that she can contribute to her own support, there is no evidence that she is capable of earning anything resembling the income which would permit her to live in accordance with the standard of living of the parties during marriage (even after adjusting for the contributions the parties received from her parents and Mr. Tedham's inheritance).  Mr. Tedham, on the other hand, with his track record as a successful businessman with substantial income, has the ability to sustain a standard of living commensurate with that enjoyed during the marriage.

[51]            In Moge, Madam Justice L'Heureux-Dubé went on to observe (at p. 864) that the Act promoted "[t]he doctrine of equitable sharing of the economic consequences of marriage or marriage breakdown" by recognizing and accounting for both the economic disadvantages incurred by the spouse who made sacrifices by staying home to care for the home and children, and the economic advantages conferred on the other spouse.  She elaborated on this view in the following passage (at p. 870) of her reasons:

Although the doctrine of spousal support which focuses on equitable sharing does not guarantee to either party the standard of living enjoyed during the marriage, this standard is far from irrelevant to support entitlement [citations omitted].  Furthermore, great disparities in the standard of living that would be experienced by spouses in the absence of support are often a revealing indication of the economic disadvantages inherent in the role assumed by one party. As marriage should be regarded as a joint endeavour, the longer the relationship endures, the closer the economic union, the greater will be the presumptive claim to equal standards of living upon its dissolution [citation omitted].

[52]            In this case, a 16-year marriage in which Ms. Tedham stayed home to take care of the home and the children called for a support order which, after taking into account Ms. Tedham's ability to contribute to her own support, provided a standard of living reasonably commensurate with that enjoyed during the marriage and which compensated Ms. Tedham, to the extent possible, for the losses she had suffered by remaining out of the paid work-force for so many years.  In that regard, the court in Moge discussed (at p. 867) the nature of the loss suffered by spouses (like Ms. Tedham) who removed themselves from the work-force in order to assume a homemaking role:

The financial consequences of the end of a marriage extend beyond the simple loss of future earning power or losses directly related to the care of children.  They will often encompass loss of seniority, missed promotions and lack of access to fringe benefits such as pension plans, life, disability, dental and health insurance [citations omitted].  As persons outside of the work force cannot take advantage of job-retraining and the upgrading of skills provided by employers, one serious economic consequence of remaining out of the work force is that the value of education and job training often decreases with each year in comparison to those who remain active in the work force and may even become redundant after several years of non-use.  All of these factors contribute to the inability of a person not in the labour force to develop economic security for retirement in his or her later years.

[53]            In summary, the Moge decision distanced itself from the clean-break theory of divorce which had elevated the objective of self-sufficiency to the governing factor in making a spousal support order. 

[54]            The significance of the Moge decision is referred to by the authors of the Spousal Support Advisory Guidelines:  A Draft Proposal (Ottawa, Dept. of Justice: 2005) (the "Advisory Guidelines") at p. 7:

In the ground-breaking Moge decision in 1992, the Supreme Court of Canada clearly rejected the Pelech trilogy and the clean-break model of spousal support.  The Court emphasized that all four support objectives in the 1985 Divorce Act had to be given weight and that the clean-break model of spousal support unduly emphasized only one of those objectives – the promotion of spousal self-sufficiency after divorce – at the expense of all the others.  Former spouses were obligated to make reasonable efforts to maximize their earning capacity and contribute to their own support but the Court recognized that some spouses, despite their best efforts, would not be able to become self-sufficient.  In the Court's view, the clean-break model went too far in deeming spouses to be self-sufficient when they were not.  In Moge the Court endorsed an expansive compensatory basis for spousal support, portraying its purpose as the equitable distribution between the spouses of the economic consequences of the marriage – both its economic advantages and disadvantages.  While the Court recognized that many different circumstances could give rise to compensatory claims, the decision focused on the most common situation – that where a spouse has sacrificed labour force participation to care for children, both during the marriage and after marriage breakdown.  Under the compensatory approach of Moge, spousal support came to be understood primarily as a form of compensation for the loss of economic opportunity – or in the language of the Divorce Act, the economic disadvantage – resulting from the roles adopted during the marriage.

[55]            The authors of the Advisory Guidelines went on to note that, in the cases following Moge, "need" became a convenient way of measuring economic disadvantage and that, at least in longer marriages, need came to be measured against the marital standard of living.  (In that regard, see Yemchuk v. Yemchuk, 2005 BCCA 406, at para. 50.)

[56]            In my view, the time-limited order in this case appears to reflect the clean-break philosophy in circumstances of a long-term marriage where the compensatory aspects of support had only been partially achieved.

[57]            In Bracklow, the issue before the court was one of entitlement to spousal support.  The court took the opportunity, however, to elaborate on the Moge decision by reference to three models of spousal support:  compensatory, contractual and non-contractual (needs-based), any or all of which may come into play in a particular case.  In this case, Ms. Tedham's claim to ongoing support is based on both compensatory principles and need. 

[58]            An interesting discussion of the relationship between self-sufficiency (taking into account the marital standard of living) and time-limited orders is found in Allaire v. Allaire (2003), 35 R.F.L. (5th) 256 (Ont. C.A.).  There, the court upheld an award of support of unlimited duration in relation to a 24-year marriage in which the parties had raised three children and both parties worked outside the home.  The wife had suffered economic disadvantages flowing from the marriage by delaying her education and giving the husband's employment priority over her own.  The husband argued that because the wife was earning $68,000 at the time of the hearing (as compared with the husband's income of approximately $190,000), she was self-sufficient and that support should be either terminated or limited in duration. 

[59]            The Ontario Court of Appeal noted that the award of support in that case was made not only to redress the economic consequences of the breakdown of the marriage, but also to compensate the wife for "the likely" permanent economic consequences of having had to postpone her post-secondary education.  At paras. 21-22 of the judgment, the court stated:

Mr. Allaire's [sic] submits that any disadvantages flowing from the marriage must defer to the fact that Ms. Allaire now earns a reasonable income that makes her "self-sufficient".  This ignores the reality that self-sufficiency is not a free-standing concept.  It must be seen in the context of the standard of living previously enjoyed by the parties.  Where, as here, the economic consequences of the marital relationship were to permanently reduce Ms. Allaire's income, it is inappropriate to consider Ms. Allaire's annual income of $68,000 as "sufficient" without considering whether Mr. Allaire can financially assist her to live a lifestyle closer to what they shared as a couple.

For the same reason, the trial judge did not err in failing to apply a time limit to the spousal support award.  As the Supreme Court of Canada stated in Bracklow v. Bracklow, [1999] 1 S.C.R. 420 at para. 57, a result of the need to balance the objectives set out in the Divorce Act is that there is no obvious or inevitable cut-off date for a spousal support order.  It is recognized that in situations such as this, "where a former spouse will continue to suffer the economic disadvantages of the marriage and its dissolution while the other spouse reaps its economic advantages", long-term compensatory support is appropriate regardless of the self-sufficiency of the disadvantaged spouse:  Moge v. Moge (1992), 43 R.F.L. (3d) 345 (S.C.C.), at 383.  Where, as here, the award is crafted to compensate Ms. Allaire for the long-term impact of the marriage on her career advancement and earning capacity, the trial judge was within her discretion in declining to limit her support to a defined period.

[Emphasis added.]

[60]            While Allaire is what I will refer to as a "non-interference" case, it makes the point that an order of spousal support which is based on compensatory principles should continue until adequate compensation has been made, even if the spouse has achieved a degree of self-sufficiency.  It also reinforces the point that self-sufficiency must be viewed in the context of the marital standard of living.  In this case, the marital standard of living was, and is, considerably higher than Ms. Tedham is able to achieve on her own and is more akin to that currently enjoyed by Mr. Tedham.

The Court went on to remove any time limit on the spousal support as well as the declining payment support award and made the following award:

[72]            Aside from the issue of retroactive spousal support, which I address later in these reasons, the first issue which must be addressed is the quantum of support.  In examining this question, I rely on my earlier discussion setting out the relative economic circumstances of the parties. 

[73]            Mr. Justice Tysoe made an award of support of $6,000 per month for the first year, $4,000 per month for the second year, and $2,000 per month for the third year, at which point support would cease.  Based on the relative circumstances of the parties, and with particular emphasis on Mr. Tedham's substantial earnings over the years to date, I conclude that Mr. Justice Tysoe's starting figure of $6,000 per month is an appropriate quantum.  When coupled with Ms. Tedham's income of $25,000, it results in gross income for Ms. Tedham in the amount of $97,000.  Assuming that Ms. Tedham is capable of working one further day per week, this would increase her potential income, based on her present employment, by about $5,000, to $30,000 per year, exclusive of support.  While Ms. Tedham listed her estimated expenses as $112,000 per year, I agree with Mr. Justice Tysoe that Mr. Tedham should not have to supplement her expenses to that level.  As noted in earlier litigation, both Mr. and Ms. Tedham tend to live beyond their means, and it is unlikely that either of them can continue to sustain the standard of living they enjoyed during the marriage to the extent it was supplemented by third parties.

[74]            Mr. Tedham's gross income for 2004 was unknown at the time of the hearing, but was $245,000 for the first seven months of the year.  This amounts to approximately $35,000 gross income per month.  Because he is on commission, and in the absence of further evidence, it is difficult to project his actual income for the full year.  Suffice it to say that it is likely to be as great as, or greater than, his income for 2003 ($343,000.)  From that he has compulsory deductions, substantial income tax, business expenses (most of which are not recoverable), and spousal support payments (which are deductible).  It is apparent that he is also making voluntary payments to assist the children, but those payments cannot take precedence over spousal support in circumstances where the children are living independently and earning income.  At the time of the hearing, Ms. Tedham enjoyed a net worth which was greater than that of Mr. Tedham, but this related to one-time payments arising from earlier court orders,  and was anticipated by Mr. Justice Tysoe to be short-lived (subject to any significant deterioration in Mr. Tedham's medical condition).

[75]            Counsel for Ms. Tedham referred to the Advisory Guidelines as a measure of the appropriate quantum and duration of support.  Those Guidelines were discussed in Yemchuk, supra, at paras. 61-70 where the court referred to them as "a useful tool to assist judges in assessing the quantum and duration of spousal support." 

[76]            In this case, based on a 16-year marriage, and utilizing the "without child support formula" the Advisory Guidelines would yield a support order in the range of $6,300-$8,500 per month with a duration of between eight and 16 years (assuming Mr. Tedham's income was in the range of $343,000 per year, and Ms. Tedham's was in the range of $30,000 per year).  While $6,000 approximates the low end of this range, the award has to take into account the reapportionment of property ordered by this Court on the first appeal.  Because that award compensated Ms. Tedham to some extent for the disadvantages she suffered as a result of the marriage and its breakdown, the award of spousal support, with or without reference to the Advisory Guidelines, should be lower than it otherwise would have been to reflect that fact.

[77]            In terms of duration of support, it appears to me that there is a likelihood that at some point in the not-too-distant future Mr. Tedham's eyesight may impact significantly on his income-earning capacity and/or work-related expenses.  Because this is a foreseeable event which may not meet the test for a variation under s. 17(1) of the Act, I agree with Mr. Justice Tysoe that it should properly be the subject of a review.  In addition, there may be other changes in circumstances which would meet the threshold test for variation under s. 17(1) which would also justify an application to the court.

[78]            In the meantime, based on my earlier analysis, I am satisfied that the order for support should be indefinite.  The order under appeal simply does not address the compensatory factors arising in this marriage, Ms. Tedham's need in relation to the standard of living enjoyed by the parties during the marriage, or her contribution to Mr. Tedham's income-earning capacity.

[79]            I would add that neither party has set aside significant funds for his/her retirement, and both parties will have to deal with the effects of any further deterioration in Mr. Tedham's eyesight in relation to his income-earning capacity.  They would be well advised to reconsider their current lifestyles, including their penchant for litigation, with their future security in mind.

[80]            In summary, for the reasons I have given, I have concluded that Mr. Justice Tysoe erred in awarding limited-time spousal support.  I would, therefore, set aside paragraphs 3 and 4 of his order and substitute an order that Mr. Tedham pay Ms. Tedham spousal support in the amount of $6,000 per month, payable on the first day of each and every month commencing December 1, 2005.  I would retain paragraph 5 of the order providing that Mr. Tedham may apply for a review of support in the event his medical condition interferes with his income-earning capacity by significantly reducing his income and/or increasing his expenses.  It is not necessary to provide in the order that the parties have a right to apply for a variation under s. 17(1) of the Act since that follows as a matter of law.

In the end the wife was left with $97000 per year and the husband roughly $280,000 to take into account the wife had received more than half of the property as a result of the trial court order.  The Court explicitly took into account that the support award should be less than the guideline amount given this critical factor.  The Spousal Support Guidelines acknowledge cases where large capital settlments are involved may be an exception to the Guidelines.