Income imputation pursuant to B.G. v. H.R., 2023 ONSC 6201
The case at hand involves the dissolution of the relationship between the Applicant father and the Respondent mother. The couple lived together from September 2012 until their separation on November 1, 2021, and they have two young daughters.
Pleadings filed by the father include claims for sole decision-making responsibility, primary residence of the children, child support, a declaration of a trust in his favor regarding the family residence, and an order preventing the mother from depleting the net proceeds of the residence.
This blog post focuses on the father’s position that the mother ought to be imputed income for child support purposes.
The primary legal issue in this post revolves around the concept of income imputation, specifically under section 19 of the Federal Child Support Guidelines. The father contends that an annual income of $50,000 should be imputed to the mother and he seeks child support based on this imputed income.
The father, in this instance, relies on subsections 19(1)(a) and 19(1)(f) of the Federal Child Support Guidelines, arguing that the mother is intentionally underemployed and has failed to provide adequate income information:
19(1) the court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following:
(a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of the child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;...
(f) the spouse has failed to provide income information when under a legal obligation to do so.
In an income imputation case, the burden of proof lies with the party seeking to establish the imputed income and the decision is up to the discretion of the judge:
Determining the amount of income to impute to a party is a matter of discretion for the trial judge. The only limitation on the discretion of the court is that there must be some basis in the evidence for the amount that the court has chosen to impute: Drygala v. Pauli (2002), 2002 CanLII 41868 (ON CA), 61 O.R. (3d) 711 (Ont. C.A.), at para. 43.
However, the court does note that the onus then shifts after a prima facie case is made out:
Although the onus is on the party seeking to impute income, once the party has established a prima face case, the onus shifts to the person seeking to defend the income position the payor takes. The reason for this is that the information that can actually determine the person's income is in their possession and no one else's. It is not fair to expect the person seeking to impute income to bear the entire onus of proving the imputation of income: Lo v. Lo, 2011 ONSC 7663 (Ont. S.C.J.), at para. 57.
Where a party fails to provide income information, s. 23 of the Federal Child Support Guidelines allows the court to draw an adverse inference and to impute an income to the spouse that the court considers appropriate based on the evidence available: Jassa v. Davidson, 2014 ONCJ 698 (Ont. C.J.), at para. 35; Smith v. Pellegrini [2008 CarswellOnt 5475 (Ont. S.C.J.)], 2008 CanLII 46927, at para. 34; Sharma v. Sharma, 2018 ONSC 862 (Ont. S.C.J.), at para. 71.
In income imputation cases, the concept of “intentional under employment” is usually raised. In other words, is the Respondent capable of earning a specific income but is otherwise choosing not to?
 In the case of Zawalreh v Alkhoury, 2021 ONSC 7956 A. Himel, J. stated as follows with respect to paragraph 19(1)(a) at paras. 59-60.
The leading case that defines intentional under-employment in Ontario is Drygala v. Pauli. "Intentionally" means a voluntary act. The person required to pay support is intentionally under-employed if that person chooses to earn less than he or she is capable of earning. The person required to pay support is intentionally unemployed when he or she chooses not to work when capable of earning an income.
When imputing income based on intentional under-employment or unemployment, a court must consider what is reasonable in the circumstances. The factors include age, education, experience, skills and health of the parent. The availability of job opportunities, number of available work hours (in light of the parent's overall obligations including educational demands), and a reasonable hourly rate may be considered.
In this case, the mother, a Registered Practical Nurse, has a history of working in her field, and her most recent payslip indicates an hourly rate of $30.55, equivalent to an annual income of $55,601 based on a 35-hour workweek. The court stated, “[i]n the case at bar, I find that there is a sufficient evidentiary basis for the court to judicially exercise its discretion to impute income to the mother in the amount proposed by the father being the sum of $50,000 per annum.”
In light of the evidence presented, the court finds a sufficient basis to impute an income of $50,000 to the mother, as proposed by the father. The case underscores the intricate nature of income imputation in family law and the critical role it plays in determining child support obligations.