I want to change my Spousal Support Agreement!
A man recently contacted me with a question…. How difficult would it be to try to change his spousal support agreement? The background story to this question was that when he and his wife separated, they had, with the help their respective lawyers, come up with a spousal support scheme, which at the time, seemed like a good arrangement to the unhappy couple.
About a year ago, a couple whom I will call Jack and Jill, of Smallville, B.C*., decided that their marriage of 14 years was over. They each engaged their respective lawyers and started the process to divorce. Prior to, and during their marriage, the couple both had decent jobs and were able to purchase rental properties in their town. Jack and Jill, like so many people in business, had their business affairs organized as a sole proprietorship.
When they separated in autumn 2023, the couple decided to keep their real estate and rental business as it was, with Jack as the landlord, property manager, and handyman. Jill, out of sympathy to her hardworking ‘X’, told him that she had a good idea for him. Instead of paying her “support payments”, he could manage the properties in their entirety. This meant that all the rental revenue would flow through their shared “business account”. Luckily for them, their rentals were occupied 100% of the time since 2021. On the other hand, maintenance costs, interest charges and taxes have used up all the cash reserves. He just finished his 2024 income tax, and it was determined that he has to pay a large CRA bill over $17,000!
This arrangement is no longer satisfactory to Jack. Jack has determined that that the traditional spousal arrangement would actually be better for him. Hence his question, could the spousal arrangement that he signed with Jill, be changed?
The answer to that question is “yes, but.” According to the Government of Canada Fact Sheet, March 18, 2025:
If you are paying spousal support that is set out in a written agreement or in a court order, you must continue to pay unless:
The order is changed by a court when:
You and your former spouse agree to change your agreement; or
The conditions for stopping payment, as set out in the order or agreement, have been met.
A court may only change a spousal support order when justified by an important change in the circumstances of either spouse. For example, if the support payer loses his or her job after the support order was made and he or she can no longer pay the amount that was ordered, a court may then decide that the support order should be changed.
If you and your former spouse have a spousal support agreement, and either of you experiences a change in your circumstances, you may wish to change your agreement to reflect your new situation. However, both you and your former spouse will need to consent to any proposed changes to your agreement before they can take effect.
If your order or agreement clearly states that spousal support is to end on a particular date or on the happening of a certain event, then payment of support can stop at that point. For example, if your order or agreement specifically provides that spousal support is to end on December 1st of the year 2020, then your spousal support obligation would end at that time.
My recommendation, as a Chartered Financial Divorce Specialist, was that he should build a logical case to bolster his argument to get the change he wants. He could try to do it by himself, or he could hire me to help him build a team that could help him. I respect my client’s desire to try to save money by “doing it himself”, but in this case, he is in this position because he trusted his lawyer and his own instincts. His lawyer, who specializes in real estate, did not counsel him to get any third-party advice before he signed the original spousal agreement. He now has to pay a large tax bill and hope that he can convince Jill, her lawyer, and ultimately, the court to change this existing arrangement.
* Names and Location are fictionalized to protect clients identity*