“The Court of Appeal in Drygala v. Pauli (2002), 61 O.R. (3d) 771 (C.A.), at para. 23, set out a three-part test for determining whether income should be imputed on the basis of intentional under-employment or unemployment as follows:
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- Is the spouse intentionally under-employed or unemployed?
- If so, is the intentional under-employment or unemployment required by virtue of his reasonable educational needs?
- If the answer to question #2 is negative, what income is appropriately imputed in the circumstances?
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The jurisprudence has set out various principles that apply to the imputation of income as follows:
a) A spouse is intentionally underemployed if he or she chooses to earn less than he or she is capable of earning having regard to all of the circumstances (Drygala, at para. 28). There is no requirement that the under-employment or unemployment be undertaken in bad faith or with the intention of avoiding support payments (Drygala, at paras. 29-36).
b) The onus is on the party seeking to impute income to establish an evidentiary basis that the other party is intentionally under-employed or unemployed (Homsi v. Zaya, 2009 ONCA 322 at para.28.).
c) The second step of the Drygala test is generally treated as an overall test of reasonableness. In Jackson v. Mayerle, 2016 ONSC 72, at para. 702, the court held that:
Once intentional underemployment is established, the onus shifts to the payor to show one of the exceptions of reasonableness.
d) Where the spouse is intentionally and unreasonably under-employed or unemployed, the court has a large range of discretion to impute as income an amount founded on a rational basis. D. v. H.D., 2015 ONCA 409
On the issue of reasonable educational needs, the Court of Appeal in Drygali, provided the factors for the court to consider when determining reasonable educational needs of a claimant in para 38-41 as follows:
[38] There is a duty to seek employment in a case where a parent is healthy. As a general rule, a parent cannot avoid child support obligations by a self-induced reduction of income. Thus, once it has been established that a spouse is intentionally unemployed or under-employed, the burden shifts to that spouse to establish what is required by virtue of his or her reasonable educational needs.
[39] There are two aspects to this stage of inquiry. The trial judge must first determine whether the educational needs are reasonable. This involves a consideration of the course of study. A spouse is not to be excused from his or her child support obligations in furtherance of unrealistic or unproductive career aspirations.
[40] But, s. 19(1)(a) speaks not only to the reasonableness of the spouse’s educational needs. It also dictates that the trial judge determines what is required by virtue of those educational needs. The spouse has the burden of demonstrating that unemployment or under-employment is required by virtue of his or her reasonable educational needs. How many courses must be taken and when? How much time must be devoted in and out of the classroom to ensure continuation in the program? Are the academic demands such that the spouse is excused from pursuing part-time work? Could the program be completed over a longer period with the spouse taking fewer courses so that the spouse could obtain part-time employment? If the rigours of the program preclude part-time employment during the regular academic school year, is summer employment reasonably expected? Can the spouse take co-operative courses as part of the program and earn some income in that way? These are the types of considerations that go into determining what level of under- employment is required by the reasonable educational needs of a spouse.
[41] The burden of proof is upon the spouse pursuing education as he or she is the person with access to the requisite information. The spouse is in the best position to know the particular requirements and demands of his or her educational program. He or she will have information about the hours of study necessary to fulfill such requirements, including the appropriate preparation time. He or she is in the best position to show whether part-time employment can be reasonably obtained in light of these educational requirements.”