Block v. Block

Block v. Block

The court held that not all corporate distributions derived from the refinancing and sale of the Commercial Property constituted Guideline income: the 2015 refinancing dividend was largely a return of capital dedicated to the contractual equalization payment and should not be fully included but income should be imputed under s.17(1); the 2017 sale proceeds paid as a 2018 dividend were similarly non-recurring and should not be fully included but portions reflecting lost corporate rental income, increased corporate rent expense and certain shareholder withdrawals (the 'Due from Shareholder' amount) and a reasonable attribution for personal use of a company vehicle should be included. The...

Citation
2020 BCSC 1694
Parties
Claimant: Angela Maria Block; Respondent: Lorne Christopher Block
Court
Supreme Court of British Columbia
Jurisdiction
Canada
Judgment Date
9 November 2020
Procedural Posture
Family Law Child Support Application Under a Separation Agreement / Reasons for Judgment (retroactive Child Support Determination)
Outcome
Application granted in part; retroactive child support determined by imputing and adjusting respondent's Guideline income for 2014-2018 as set out; parties to compute arrears based on those figures or refer to Registrar if unable to agree; each party to bear own costs.
Legal Topics
Retroactive Child Support, Income Determination Under Federal Child Support Guidelines, Separation Agreement Enforcement, Treatment of Corporate Dividends and Shareholder Loans, Income Imputation and Averaging (s.17), Gross Up of Capital Dividends (s.19(1)(h)), Allocation of Corporate Vehicle Expenses
Source Language
English
Family Law Child Support Property Division Tax Law Corporate Law Retroactive Child Support Income Determination Under Federal Child Support Guidelines Separation Agreement Enforcement +4 more

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Parties

Angela Maria Block

Claimant

Lorne Christopher Block

Respondent

Procedural Posture

Family Law Child Support Application Under a Separation Agreement / Reasons for Judgment (retroactive Child Support Determination)

Legal Issues

  1. 1 Whether proceeds from corporate refinancing and sale of a corporate commercial property constitute income for child support purposes
  2. 2 Proper treatment of dividends (taxable vs actual) and capital dividends under the Guidelines
  3. 3 Whether shareholder loans and 'due from shareholder' amounts should be included as income

Ratio Decidendi

The court held that not all corporate distributions derived from the refinancing and sale of the Commercial Property constituted Guideline income: the 2015 refinancing dividend was largely a return of capital dedicated to the contractual equalization payment and should not be fully included but income should be imputed under s.17(1); the 2017 sale proceeds paid as a 2018 dividend were similarly non-recurring and should not be fully included but portions reflecting lost corporate rental income, increased corporate rent expense and certain shareholder withdrawals (the 'Due from Shareholder' amount) and a reasonable attribution for personal use of a company vehicle should be included. The...

Court Disposition

Application granted in part; retroactive child support determined by imputing and adjusting respondent's Guideline income for 2014-2018 as set out; parties to compute arrears based on those figures or refer to Registrar if unable to agree; each party to bear own costs.

Orders

  • Respondent's Guideline incomes set as follows: 2014: 118,679 CAD; 2015: 114,000 CAD; 2016: 112,444 CAD; 2017: 235,325 CAD; 2018: 145,135 CAD.
  • If parties cannot agree on total retroactive child support payable based on the incomes found, matter to be referred to the Registrar for calculation.