Law Clerks' Review

Changes to the Canada Labour Code (“CLC” or “Code”) are effective on September 1, 2019.  To ensure compliance, federally regulated employers should review their policies and procedures.

This is part one of a two part series summarizing changes to the Code.  This part focuses on federal employment standards related to vacation, holiday and leave entitlements.  The remaining changes will be summarized in part two.

Changes to Minimum Standards Regarding Vacation and Holidays

An employee can make a written request to take vacation in more than one period. An employee may take certain leaves during their vacation time by providing their employer with written notice. An employee may commence a statutory leave in the middle of a vacation period. The employee’s remaining vacation days are then postponed.

Employees will now be entitled to:

• 2 weeks of vacation at 4% vacation pay after 1 year of service;
• 3 weeks of vacation at 6% vacation pay after 5 years of service; and
• 4 weeks of vacation at 8% vacation pay after 10 years of service.

Moreover, for the purpose of calculating vacation entitlements, an employee’s years of service are transferred in the event of a sale of business which results in the employee working for a federally regulated employer, that was previously provincially regulated. Employees also do not need to be employed for 30 days before receiving statutory holiday pay.

New Leave Standards

Personal Leave: employees are now entitled to up to 5 days for illness, injury, health-related family responsibilities, education-related responsibilities for family members under 18, urgent matters, citizenship conferral, or prescribed reasons. The first 3 days of leave are paid for employees with 3 months’ service. The definition of who qualifies as a family member for the purposes of this leave will be specified in the regulations.

Leave for Victims of Family Violence: an employee who is the victim of family violence or who is the parent of a child that is the victim of family violence is entitled to 10 days in a calendar year to seek medical attention for themselves or their child, to obtain services from organizations that aid victims of family violence, to obtain counselling, to relocate temporarily or permanently, to seek legal or law enforcement assistance or prepare for legal proceedings, or to take any measure as prescribed by regulation. The first 5 days of leave are paid for employees with 3 months’ service. An employee who has likely committed the family violence is not entitled to this leave.  An employer can request documentation to substantiate the leave within 15 days of the employee’s return to work.

Leave for Traditional Aboriginal Practices: an Aboriginal employee (defined as Indian, Inuit, or Métis for the purposes of this leave), who has been continuously employed for 3 months may take 5 days per calendar year to hunt, fish, harvest or engage in any other traditional Aboriginal practice prescribed by regulation. The employer may request documentation substantiating that the employee is an Aboriginal person, within 15 days of the employee returning from the leave.

Court or Jury Duty Leave: employees may take leave to act as a witness, juror or to participate in jury selection. The maximum leave period is not specified. There is no service requirement for eligibility.

Existing leave entitlements have been modified as follows:

• Medical Leave (formerly “Sick Leave”): employees are now eligible for up to 17 weeks of unpaid leave for personal illness or injury, organ or tissue donation, or medical appointments during work hours. There is no service requirement for eligibility. An employer may require a health care practitioner’s certificate for an absence of 3 days or longer. The pension, health and disability benefits and the seniority of an employee who is absent from work due to medical leave, accumulate during the entire period of the medical leave of absence.
• Maternity and Parental Leave: the minimum service requirement for eligibility has been removed. New parents have an additional 8 weeks of aggregate parental leave if leave is taken by the second parent.
• Bereavement Leave: employees may now take 3 days of paid bereavement leave and 2 days of unpaid leave for an immediate family member’s death to be taken from the day of the death until six weeks after the funeral, burial, or memorial service (whichever occurs the latest).
• Reservist Leave: employees can take a maximum leave period of 24 months in a 60-month period. There is a 3 months’ service requirement for eligibility.

Changes to the Canada Labour Code (“CLC” or “Code”) are effective on September 1, 2019, or on a date to be named. To ensure compliance, federally regulated employers should review their policies and practices.

This is part two of a two-part series summarizing the changes.  Part one focused on federal employment standards related to vacation, holiday and leave entitlements.  This part summarizes the remaining changes.

Changes effective on September 1, 2019:

Shift Changes

An employer must provide 24 hours’ notice in the event that the employer changes or lengthens an employee’s shift or a period of time an employee is required to work. However, this notice requirement does not apply if the employer must change or lengthen an employee’s shift as a result of a threat to the life, health or safety of a person, a threat of damage or loss to property, or threat of serious interference with the ordinary working of the employer’s industrial establishment that was not reasonably foreseeable.

Overtime

In addition to overtime pay, employees can now opt for paid time off at one and one half their usual wage rate for every overtime hour worked. In order to qualify, there must be a written agreement between the employer and employee specifying the dates on which the paid time off will be taken by the employee. Additionally, the paid time off must be taken within three months of the pay period during which the employee worked the overtime hours. This can only be extended if the collective agreement or written agreement between the employer or employee specifies a longer time period. However, the longer time period cannot be longer than 12 months after the pay period in which the employee worked the over time.

If the employee fails to take the paid time off, the employer must pay out the banked time at one and one half times the regular wage rate of the employee. The employer must make this payment within 30 days of the end of the pay period when the paid time off was supposed to be taken. If an employee has not taken their paid time off and ceases to be employed, the employer must pay out the remaining banked hours at one and one half the employee’s regular wage rate on the day the employee worked the overtime.

Employees may refuse to work overtime if it interferes with any family responsibilities under the new Personal Leave. An employee cannot refuse to work overtime in instances where there is a threat to the life, health or safety of a person, a threat of damage or loss to property, or threat of serious interference with the ordinary working of the employer’s industrial establishment that was not reasonably foreseeable. Employers cannot reprise against employees for refusing to work overtime for this reason.

Flexible Work Arrangements

After working six continuous months with an employer, an employee can request changes, in writing, regarding the number of hours the employee is required to work, their work schedule, their work location or any terms and conditions that apply to the employee that are prescribed by regulation. The employer must make a decision to fully grant the request, partially grant the request or fully refuse the request. A partial or full refusal must be communicated in writing and justified on the following business needs:

• the request would create additional, burdensome costs for the employer;
• there would be a deterioration in the quality or quantity of the work and the employer’s ability to satisfy customer demands;
• the employer could not compensate by reorganizing the work amongst other employees or hiring new employees; and
• if the employer granted the request, the employee in question would not have enough work.

The employer is not allowed to reprise against an employee for requesting flexible work arrangements.

Health Care Practitioner

The Code has expanded the types of healthcare professionals who can provide medical documentation to employees seeking leaves from work. Employer must accept medical documentation supporting an employee’s need for a leave supplied by a healthcare professional who is lawfully entitled to provide health services in a province.

Breaks and Rest Periods

Employees are entitled to a 30 minute unpaid break for every 5 consecutive hours of work. Employees must also receive 8 consecutive hours of rest between work periods or shifts. However, these break and rest period requirements do not apply if the employer must change or lengthen an employee’s shift as a result of a threat to the life, health or safety of a person, a threat of damage or loss to property, or threat of serious interference with the ordinary working of the employer’s industrial establishment that was not reasonably foreseeable.

Notice of Work Schedule

Employers must provide employees with written notice of their work schedule at least 96 hours before the start of the employees’ first work period or shift. If an employee does not receive notice at least 96 hours beforehand, the employee can refuse to work any work period or shift that starts less than 96 hours after they received notice. However, an employee cannot exercise their right of refusal if the employer fails to provide 96 hours’ notice because of a threat to the life, health or safety of a person, a threat of damage or loss to property, or threat of serious interference with the ordinary working of the employer’s industrial establishment that was not reasonably foreseeable. An employer may not reprise against an employee for exercising their right of refusal.

Breaks for Medical Reasons or Nursing

An employee is entitled to unpaid breaks for medical reasons or nursing as needed. An employer may request medical documentation to substantiate the need for these breaks.

Information Related to Employment

Employers must post the most recent version of any materials that the Minister makes available and that contains information respecting employers’ and employees’ rights and obligations under the CLC. Employers must also, within the first 30 days of employment, provide employees with a copy of such materials.

Changes passed but the effective date has not yet been named:

Age of Employment

The age of employment for work in hazardous occupations has been raised from 17 to 18 years of age.

LawPRO said there was “real growth” in the proportion of claims from family law and wills and estates in 2018.

On December 9, 2019, Ontario’s Attorney General announced wide-ranging reforms to key parts of the Class Proceedings Act (CPA) as part of a collection of civil justice reforms in Bill 161, the Smarter and Stronger Justice Act, 2019. Bill 161 is omnibus legislation that will amend or enact 20 pieces of legislation, including the CPA. The CPA amendments are the first major changes to the Act since it was enacted more than 25 years ago.

Most of the amendments to the CPA reflect the Law Commission of Ontario’s proposals following its comprehensive review of the Act released in July of this year (see Torys’ coverage of the LCO’s report here). However, some of the proposed amendments, such as changes to the certification test, were specifically considered and rejected by the LCO. It will take time for litigants to feel the full impact of the changes; the Bill has just been introduced for first reading and must work its way through the legislative process over the coming months. Most of the changes will apply only to cases commenced after the amendments are brought into force (with one notable exception relating to the dismissal of dormant proceedings).

Many of the amendments will be beneficial to defendants and potential defendants. Other amendments, although not directly applicable to defendants, have the effect of restricting the options available to plaintiff counsel and thus of streamlining and potentially expediting the class proceedings process.

What you need to know

• Bill 161 proposes changes to numerous aspects of class action practice and procedure in Ontario, including:
  • providing a mechanism to dismiss dormant proceedings;
  • revising the test for whether a class proceeding is the “preferable procedure”; and
  • requiring the court to consider the existence of class actions in other provinces when deciding whether to certify a proceeding.
• The Bill also proposes procedural changes including to the timing of summary judgment motions, appeal routes, carriage motions, collection of data on class actions, costs of certification notices, and the approval of settlements and third-party funding arrangements.
• Aside from the dismissal for delay provisions, these amendments will apply only to proceedings filed after the legislation comes into force.

Key changes

Dismissal for delay

The ability to bring a motion to dismiss a “dormant” class proceeding is a significant change, designed to expedite proceedings. Parties will have one year to complete at least one of the following steps, otherwise, a court will be required to dismiss the proceeding following a motion. Steps include:

• the representative plaintiff files “a final and complete” motion record for the certification motion;
• the parties agree to a timetable for service of the motion record or for other steps required to advance the proceeding, and file that timetable with the court;
• the court orders the proceeding not be dismissed, and establishes a timetable; or
• any other steps required by regulation have taken place.

The dismissal provisions will apply to current proceedings as well as new proceedings. For existing proceedings, the one-year period by which a motion record must be filed, or a timetable agreed to or imposed, will run from the date the amendments become law.

New test for “preferable procedure”

In a potentially major change, Bill 161 provides that a class proceeding is the preferable procedure “only if, at a minimum” it is superior to all reasonably available means of determining the entitlement of the class to relief, and common questions of law or fact predominate over individual issues. This amendment runs contrary to the recommendations of the LCO, and substantially alters the preferable procedure test as most recently interpreted by the Supreme Court of Canada in AIC Limited v. Fischer,¹ which set out a five-factor test for preferability.

The superiority and predominance requirements in Bill 161 both appear in Rule 23(b)(3) of the United States Federal Rules of Civil Procedure, which may indicate that the government wishes to align class action law in Ontario more closely with that of the United States (where it can be harder for plaintiffs to obtain certification). Whether this will be the result remains to be seen; the class proceedings legislation in other provinces, such as British Columbia and Alberta, currently requires that courts consider the “predominance” of common issues over individual ones when considering preferable procedure.²

Mandatory consideration of multi-jurisdictional actions in other provinces

Multi-jurisdictional class proceedings—brought on behalf of residents of two or more provinces or territories involving the same or similar subject matter—have increased in prevalence in recent years. Unlike the multi-district litigation system that allows courts in the United States to manage multiple class actions related to the same subject matter, Canada’s constitutional structure affords fewer options for coordinating overlapping claims in different provinces when local class counsel do not cooperate in advancing those actions.

In 2005, the Uniform Law Conference of Canada recommended legislative changes to allow courts to deal with multiple “multi-jurisdictional” class actions. Legislatures in Alberta, British Columbia, and Saskatchewan have enacted the suggested provisions over the past decade. Though Bill 161 would implement similar provisions in the CPA, an important distinction from legislation in other provinces is that the amendments cover not only multi-jurisdictional class proceedings, but also other situations involving multiple parallel class actions, and allow for earlier resolution of which proceeding will be moving forward.

The amendments apply where a class proceeding (including a multi-jurisdictional class proceeding) involving the same or similar subject matter has been commenced outside Ontario. In that case, the court will be required to consider whether it would be preferable for some (or all) of the claims of the class members in the Ontario proceeding to be resolved in the other jurisdiction. The legislation provides certain objectives and factors for the court to consider in making that determination.

Notably, Bill 161 provides that a party or class member may bring a motion prior to certification to determine whether an extra-provincial proceeding should be preferred to an Ontario one. This appears contrary to the approach in some other provinces, where courts of appeal have indicated that the preferable time to make this determination is at the hearing of the certification motion.³

Other procedural changes

Motions before certification

Bill 161 provides for greater use of preliminary motions prior to certification whether they be summary judgment, or any other motion that “may dispose of the proceeding in whole or in part,” or may narrow the issues to be determined or the evidence required in the proceeding.

Appeal routes and related amendments

Currently, defendants must obtain leave to appeal a certification decision to the Divisional Court, whereas plaintiffs have an automatic right of appeal if certification is denied. This difference is to be abolished. Bill 161 provides that all parties will have a right of appeal from a certification decision directly to the Court of Appeal. Additionally, plaintiffs appealing a refusal to certify a proceeding will be restricted in their ability to amend their notice of motion, pleadings, or notice of application, unless there are “exceptional or unforeseen circumstances.”

Data collection

Other amendments to the CPA will help to both coordinate cases across jurisdictions and evaluate the effectiveness of class proceedings. Plaintiffs will be required to register class proceedings in accordance with regulations to be published in the future and give notice of the proceeding to representative plaintiffs in similar cases in other jurisdictions. Those charged with administering settlements and distributing awards made to class members will be required to file reports with the court containing information about the case, including the amount of any award, the number of class members, how many class members opted out, distributions made to class members, administrative costs and counsel fees and disbursements.

Carriage motions

Once amended, the CPA will give courts specific powers on carriage motions, which occur when two or more representative plaintiffs commence claims related to the same subject matter. Carriage motions will have to be made no later than 60 days after the first proceeding was commenced and be heard as soon as possible afterward. The carriage decision will be final and not subject to appeal. The amendments identify a number of factors for the court to consider on such motions, eliminate appeals from carriage motions and provide that class counsel may not seek to recover the costs of the carriage motion either from the class or defendants. The amendments will bar the commencement of similar proposed class proceedings in Ontario more than 60 days after the first proposed class proceeding has been commenced.

Settlement approval

The amendments provide specific direction to courts in approving settlements. The party seeking approval will be required to make full disclosure of all material facts, and file an affidavit providing information on, among other things, the method used for valuing the settlement, the plan for allocating and distributing settlement funds, whether there have been any objections, the anticipated number of class members who are expected to make a claim under the settlement, and evidence as to how the settlement is fair, reasonable and in the best interests of the class.

Costs of certification notices

Presently there is uncertainty as to which party is responsible for the cost of certification notice programs. Bill 161 clarifies this issue and provides that plaintiffs shall initially bear these costs, which they may in turn seek to recover from the defendants only at the end of the proceeding and “in the event of success in the class proceeding.”

Third party funding arrangements

Bill 161 allows for third party funding agreements in class proceedings. Those agreements will now explicitly be subject to court approval and will not be enforceable unless approved. A motion for approval, on notice to defendants, must be made as soon as practicable after the agreement is entered into, and a copy of the agreement must be provided to the defendants (though certain information may be redacted).

On December 9, 2019, Ontario’s Attorney General introduced Bill 161, the Smarter and Stronger Justice Act, 2019 to “simplify a complex and outdated justice system”.

Among the omnibus legislative reforms are the first comprehensive amendments to Ontario’s class actions regime since its introduction in 1993. One of the government’s stated objectives in reforming the Class Proceedings Act (CPA) is to ensure that “businesses experience fewer financial and reputational risks”¹. We provided a summary of the significant amendments in an earlier Torys bulletin. Here we examine whether the government’s proposed changes to the CPA are likely to be beneficial to defendants; in particular, we consider the proposed amendments:

• raising the bar for certification through a new test for preferable procedure;
• requiring courts in Ontario to account for the existence of class actions in other provinces;
• broadening the courts’ power and discretion on carriage motions; and
• directing courts to dismiss proceedings for delay.

A new test for preferable procedure

Arguably the most significant amendment to the CPA is the introduction of a new preferable procedure threshold as part of the five-part certification test. Currently, to meet the certification test, a plaintiff bears the burden of proving that the proposed class action is a “preferable procedure for the resolution of the common issues”². The plaintiff must lead “some basis in fact” to prove that a class action is: a) a fair, efficient and manageable method of advancing the claim; and b) preferable to other reasonably available means of resolving the claim. The leading case interpreting the preferable procedure requirement is the Supreme Court of Canada’s decision in AIC Limited v. Fisher³. In that case, the Court set out five inquiries to resolve preferable procedure. Those inquiries assess whether a class action or another procedure would achieve the principal goals of class actions, namely judicial economy, behaviour modification and access to justice. Bill 161 would substantially modify that approach.

In a nod to our neighbours to the south, Bill 161 amends the preferable procedure test to adopt almost verbatim the predominance and superiority test set out in the rules for class action certification in the U.S. Federal Rules of Civil Procedure⁴. The proposed amendment directs Ontario courts to find that a class proceeding is the “preferable procedure” only if, at a minimum:

(a) it is superior to all reasonably available means of determining the entitlement of the class members to relief or addressing the impugned conduct of the defendant; and

(b) the questions of fact or law common to the class members predominate over any questions affecting only individual class members⁵.

The text of the proposed amendment signals a more onerous test for certification. What remains to be seen, however, is the extent to which Ontario courts will adjust their approach to preferable procedure if the amendments are enacted. If Ontario courts follow the clear legislative intent to raise the bar for certification, there may be new grounds “to protect the defendant from being unjustifiably embroiled in complex and costly litigation”⁶. This is clear from the experience in the United States where the predominance and superiority criteria have led courts to refuse certification where proposed claims raise:

• material differences in the various state laws governing class members’ claim;
• a large number of individualized factual issues; or
• individual legal issues such as causation or reliance.

A note of caution: Canadian class action judges have not historically followed the approach to certification of their U.S. counterparts, going so far as to have expressly rejected a predominance test. This is true even though class proceedings legislation in other provinces, such as British Columbia and Alberta, requires that courts consider the “predominance” of common issues over individual ones when considering preferable procedure⁷. An early example of Ontario courts refusing to follow the U.S. approach to predominance was former Ontario Chief Justice Winkler’s rejection of the U.S. approach, holding that “[an] action might well be suited for a class proceeding where the individual issues predominate over the common issues on a simple numerical basis”⁸.

The most common explanation offered by Canadian courts for refusing to follow the U.S. approach has been the significant differences in the legislative tests for certification. Indeed, in Fischer, in articulating a Canadian approach to preferable procedure, the Supreme Court of Canada noted the differences in the language of section 5(1)(d) of the CPA and U.S. Rule 23(b)(3)⁹. However, if the proposed amendments come into force, those differences will be no more.

Multi-jurisdictional class actions

Bill 161 proposes to give Ontario courts new powers to deal with “multi-jurisdictional” class proceedings, which are those cases brought on behalf of residents of two or more provinces or territories. Defendants often face overlapping and duplicative class actions that propose to represent the same or similar classes in multiple provinces. To date, defendants have been left with few options to deal with them in Ontario. The Uniform Law Conference of Canada proposed legislation to give courts those tools in 2005, and those provisions have now been enacted (with minor variations) in the class proceedings laws in British Columbia, Alberta, and Saskatchewan¹⁰.

Those laws require courts to consider the existence of overlapping multi-jurisdictional class actions and whether it would be preferable to have some or all of the claims resolved in another jurisdiction. The lawyers in the other cases have standing to make submissions on those issues, and the laws each set out factors that judges must take into account in reaching a decision. Bill 161 would add similar requirements into the CPA.

One question raised by these laws is the stage at which that analysis should take place. From a defendant’s perspective, it should be as early as possible to avoid expending resources (both those of the parties and of the courts) dealing with multiple certification motions in multiple provinces. Many courts, including the BC Court of Appeal, have reached the opposite conclusion, reasoning that the issue should be dealt with at the certification motion unless the defendant can demonstrate that the actions are completely duplicative¹¹.

Bill 161 specifically addresses this issue. Proposed section 5(8) would permit a court to decide before the certification motion whether an overlapping proceeding in another province is preferable to the Ontario case (and to therefore stay the Ontario proceeding). Whether courts will do so remains an open question, though this provision seems to be a clear legislative response to the case law from other provinces deferring the issue to the certification hearing.

Carriage

Bill 161 gives Ontario courts new powers to deal with a similar issue to overlapping proceedings in multiple provinces: overlapping proceedings in the same province. Where two or more representative plaintiffs start claims related to the same subject matter, the court is asked to decide which one should go forward. Bill 161 proposes new deadlines and rules for carriage motions that will speed up this phase of the proceeding, and sets out specific factors that must be considered by the court in determining which proceeding should go forward. Among other things, the court is to have in mind the proposed case theory, relative likelihood of success, expertise and experience of each counsel team, and the funding of each proceeding (including the existence of third-party funding). 

On the timing front, Bill 161 requires that a carriage motion be made within 60 days of the day on which the first proceeding was commenced, and that it be heard “as soon as is practicable.” The costs of carriage motions are not to be recovered from class members or from defendants, and there are to be no appeals from a carriage decision. Bill 161 also bars the commencement of proceedings involving the same or similar subject matter without leave of the court if more than 60 days has passed since the existing proceeding was commenced. These provisions should provide defendants with more timely certainty about the case they have to meet, at least in Ontario.

Dismissal for delay

Finally, in a move to foster greater certainty and finality, the amendments direct courts to dismiss proceedings for delay unless one of the following occurs within one year of the claim being commenced:

• the representative plaintiff files “a final and complete” certification motion record;
• the parties agree to (and file) a timetable for service of the motion record or for other steps required to advance the proceeding;
• the court orders the proceeding not be dismissed, and establishes a timetable; or
• any other steps required by regulation have taken place.

Although this amendment appears to be designed to relieve defendants of “dormant” proceedings, courts are afforded discretion to not dismiss the proceeding and to establish a timetable instead. Past experience with Ontario courts suggests that defendants should be cautious in concluding this new tool will result in class actions being dismissed.  It may, instead, become an impetus for greater case management of class proceedings, and more active class proceedings, since plaintiffs will be required to secure and comply with procedural timetables.

If you run a business or have sophisticated personal holdings, the concept of “capital gains” and “capital losses” may be quite familiar to you. As you likely know, capital property consists of that category of assets and property that is depreciable, and includes things that you can own and sell as desired, like business equipment, furniture, securities (in the form of shares and stocks), real estate, and even intangibles (like goodwill).

As compared to the amount you initially paid for it (a figure that for tax purposes takes into account certain related costs and is known as the adjusted cost base), you will trigger a capital gain or capital loss depending on whether you sell your capital property for more or less than the adjusted cost base, respectively.

Capital gains and capital losses are recorded for Income Taxes purposes, although in both cases you are allowed to deduct any legitimate expenses that you incur in the course of selling your capital property.

But what you may not realize is that as a separated or divorcing parent, capital gains and capital losses can have a big impact on how any child support obligations you may have will be calculated.

In this specific context, here are the main points to know:

1. Capital gains are considered income for child support purposes.

    

   Under the Federal Child Support Guidelines, capital gains are reported as part of the income that a court will consider in setting how much child support you are required to pay. This is provided for right in the Guidelines (in sections 15 through 19 and Schedule III, item 6).

   Note that for these specific purposes, it is the actual, net amount of any capital gains that must be added to your reported Guidelines income for the year; this may be different from the amount you report for Income Tax purposes.

    

2. Capital losses are deducted from capital gains. The Guidelines set out a straightforward approach to capital losses, directing that for child support income determination purposes the amount you report for your capital gains is only that amount that is “in excess” of your capital losses (Again, see item 6 in Schedule III of the Guidelines).

    

3. There might be exceptions. In terms of reporting the income that will form the basis for your Guidelines-driven child support obligations, the law does recognize that sometimes there will be out-of-the-ordinary capital gains or capital losses in any given year. Because these unusual or one-off events are a marked departure from the norm, they can skew your overall financial picture by unduly inflating or reducing your income – which in turn directly impacts your child support obligations.

Section 17 of the Guidelines expressly accounts for this, by allowing a court to make adjustments in appropriate cases to arrive at the fairest determination of your annual income. For example, it allows a court to use its discretion to adjust the amount of a “non-recurring capital or business investment loss”, including related expenses, carrying charges and interest expenses, if to do otherwise would not result in the fairest determination of your annual income.

Using this leeway, courts can avoid applying the normal rules to your child support calculation if warranted. Note that if you are the person arguing for such a deviation, it will fall to you to convince the court that it is justified in your circumstances.

It’s important to get good family law advice when contemplating the sale of capital assets, so that you fully understand how – in addition to having the usual tax repercussions – any capital gain or capital loss might “flow through” to affect your child support obligations as well.

*This article was originally written and published by Shulman Law Firm.
Reprinted with permission.

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