Written on behalf of NULaw
A recent decision from the Ontario Superior Court of Justice took a look at how to handle the issue of security of costs during a custody dispute. Security of costs is the amount of money payable by a plaintiff and used to pay a defendant where that defendant is successful at trial and the court rules that the plaintiff is liable for costs.
The husband and wife in question met while the wife was vacationing in Bermuda in 1998. The husband, who resides in and is a citizen of Bermuda, was successful in winning unsupervised visitation with his children while he visited Ontario. The wife sought to appeal the judgment. Meanwhile, the husband sought security for costs in the amount of $25,000. The Superior Court of Justice granted the husband’s request, which the wife then also appealed.
A Lengthy Trial and Ongoing Motions
The original 23-day trial, which dealt mainly with access issues, took more than 14 months to conclude, and was halted by motions 11 times to ensure an order granting the husband unsupervised access was complied with. The trial judge found the husband had rarely been able to gain access to the children without engaging in litigation. Each time the issue of access was before the court, the husband was granted access with the children. Between 2011 and 2015, the husband had a total of 12 visits with the children, two of which were supervised.
The rules for leave to appeal as outlined in Ontario’s Rules of Civil Procedure state:
Leave to appeal shall not be granted unless, (a) there is a conflicting decision by another judge or court in Ontario or elsewhere on the matter involved in the proposed appeal and it is, in the opinion of the judge hearing the motion, desirable that leave to appeal be granted; or (b) there appears to the judge hearing the motion good reason to doubt the correctness of the order in question and the proposed appeal involves matters of such importance that, in his or her opinion, leave to appeal should be granted.
In her argument for appeal, the wife pointed to a line of caselaw stating the courts should take a cautious approach to granting security for costs when the issue is custody or access, and that such security should only be granted in exceptional circumstances. She argued the judge who granted security had failed to identify the exceptional circumstances. Furthermore, she argued the first part of the test is satisfied since the couple’s children would be impacted. With respect to the second part of the test, the wife argued that the judge had made a series of errors of fact and law in the decision to grant security, bringing the correctness of the decision into question. She further argued that the judge who granted security “seriously misapprehended the evidence and submits ‘that the Supreme Court has held that “an appellate court must intervene when there is material error, a serious misapprehension of the evidence, or an error in law.’” The Appeal Judge ultimately ruled in favour of the husband, finding that exceptional circumstances existed in this case. The security for costs were directly related to the high conflict between the parties and there had been no incorrectness in the original judge’s decision. Decisions around the care of children can be some of the most important ones made during a separation and divorce. Custody and access can be emotional, and can also influence other aspects of separation and divorce, such as division of property and support. At NULaw our lawyers are experienced in helping parents understand their rights in order to make informed, rational decisions. Contact our offices online or by phone at 416-481-5604 if you are involved in a separation or divorce and would like to schedule a consultation.
An Ontario court recently addressed a situation involving the separation of a common-law couple who, in addition to being life partners, had also been business partners.
Two veterinarians, Hicks and Armstrong, were involved in a 22-year common-law relationship, which ultimately came to an end in 2015. During the course of their relationship, they ran two veterinary clinics together, while Armstrong also had a fitness business. In addition, the couple also owned a real estate holding company that oversaw the property assets of their ventures. The couple’s businesses were in heavy debt at the time of their separation. During a settlement mediation, Hicks agreed to buy out Armstrong’s interest in the business and to provide her with three years of spousal support.
Complications arose during the year it took Hicks to finance nearly three million dollars in financing to settle the businesses’ debts and pay out Armstrong. Shortly after the couple separated, Armstrong began to keep separate accounting books for her business interests. Hicks eventually discovered Armstrong had undisclosed debts including:
- Unremitted HST in the sum of $47,097.77;
- Invoices for snow clearing services in the sum of $6,102.00;
- Advertising invoices for Booster Magazine in the sum of $3,039.87; and
- Bad and/ouncollectible debts from Spoil Me Pets in the amount of $26,989.64.
Hicks pursued an action to absolve himself of Armstrong’s undisclosed debts.
Looking for a Remedy for Breach of Contract
Meanwhile, Armstrong sought damages for breach of contract due to Hicks taking a year to obtain the financing needed to make good of his end of the contract. Regarding Armstrong’s hidden debt, the Judge turned to the settlement agreement in order to affirm what the couple agreed to
The Respondent (Hicks) shall assume full responsibility for all accounts payable for any of Arthur Veterinary Clinic Inc. (“AVCI”), Arthur Veterinary Professional Corporation (“AVCProCO”), North Wellington Animal Hospital (“NWAH”), and 2233840 Ontario Inc, (“223”), which accounts include but are not limited to: (a) any Veterinary Purchasing invoices, including the account opened by the Applicant (Armstrong) when she operated the business; (b) any amounts owing to Ward and Uptigrove; or (c) any wages, benefits, or vacation pay owed to any employee.
- For greater certainty, if any accounts are in the name of the Applicant (Armstrong), but were for business related items for AVCI, AVCProCO, NWAH, and 223, the Respondent (Hicks) shall be responsible for these as well.
- The Respondent (Hicks) shall provide to the Applicant (Armstrong) a complete release or indemnity in relation to any monies owed by AVCI, AVCIProCo, NWAH, and 223, save and except any lease obligations entered into by the Applicant (Armstrong) on a personal capacity with respect to 223, in a form approved by counsel, including any debts associated with:
(a) corporate taxes owing; (b) property taxes owing; or (c) HST or source deductions owing. To be clear, This Order is meant to be a comprehensive resolution of all outstanding issues between the Respondent Robert Bryan Hicks and the Applicant Kathryn Alexandra Armstrong, and neither will have any course of action as against the other in relation to these matters If it is discovered after these Minutes are signed that a further non-disclosed liability attaches to the Applicant Kathryn Alexandra Armstrong, which is related to the AVCI, AVCProCo, NWAH, or 223, it is understood that the Respondent Robert Bryan Hicks is not to assume responsibility for same, subject to paragraphs 10 and 11 herein.
The settlement agreement clearly covered what was to be done with HST debt. The Judge ruled that such debts must have been known to Hicks, especially since he had access to the company’s books for a full month leading up to the conclusion of the settlement being reached. Regarding the other debts, the Judge looked at section 10 of the settlement agreement, which states Hicks would become responsible for all debts, including any of an undisclosed nature. As for Armstrong’s claim against Hicks, the Judge ruled that it is not unreasonable for such a complicated business deal to take time to complete. The Judge ordered that the only damages payable to Armstrong would be 2% interest on the money she was to receive upon Hicks’ obtaining of financing. The lawyers at NULaw bring a personalized and practical approach to legal disputes. If you are a business owner going through the emotionally and financially trying times of a separation or divorce, we can help. We rely on our combined family and corporate law experience to advise entrepreneurs and help them identify and mitigate potential legal risks, including any that may arise from a family dispute that may affect their business. Contact us by email or by phone at 416-481-5604.
A recent Small Claims Court decision from Nova Scotia addresses a question commonly asked by engaged couples who break up before the wedding: who gets to keep the ring?
Devin Sherrington and Lauren Arbuckle were planning their wedding when arguments over how much they should spend on the event led to Sherrington suggesting that the wedding be postponed. Rather than agreeing to the postpone the wedding, Arbuckle ended the relationship. The couple eventually found themselves in the Small Claims Court of Nova Scotia fighting over who had the right to the ring after their breakup. Sherrington argued that the 3.25 carat ring was a conditional gift, and when Arbuckle broke up with him, he should get that gift back.
Canadian decisions surrounding ownership of engagement rings go back as far as 1917 where a decision in Jacobs v. Davis,  2 K.B. stated:
Though the origin of the engagement ring has been forgotten, it still retains its character of a pledge or something to bind the bargain or contract to marry, and it is given on the understanding that a party who breaks the contract must return it. Whether the ring is a pledge or a conditional gift, the result is the same. The engagement ring given by the plaintiff to the defendant was given upon the implied condition that it should be returned if the defendant” (i.e., the lady) “broke off the engagement. She did break the contract, and therefore must return the ring.
110 years Later, the Test Remains the Same
The Adjudicator noted that while many elements of marriage are different today than they were in 1917, the test of who owns an engagement ring has stood the test of time. As such, the case would have to be determined by deciding whether Sherrington’s postponement of the wedding was really just a postponement or if it was tantamount to a cancellation. The Adjudicator found Sherrington made the unilateral decision to postpone the wedding, and Arbuckle made the unilateral decision to end their relationship, but only after trying to propose new wedding dates. However, Sherrington would not agree to set a new date. In addition, after the engagement was over, Sherrington texted Arbuckle, writing, “Do you want to just keep your ring?” and followed up with “It’s up to u”. Arbuckle responded, “I would like to yes. Is that ok?” Sherrington replied, “Sure it’s up to u. If I need money later (we) can always do something with that.” Ultimately, the Adjudicator ruled that Arbuckle was entitled to keep the ring, writing
In my view, as of April 22, 2016, the ring belonged exclusively and unconditionally to Lauren Arbuckle, regardless of who broke off the engagement. As noted further, I find there was no agreement that it be pledged as collateral.
Separation can be a confusing and stressful time. In addition to the emotional weight of a separation, careful consideration needs to be given to the division of property. The lawyers at NULaw can help make this difficult time as stress-free as possible. We help our clients understand their legal rights and obligations while weighing their options. We want our clients to save money, time and stress. Please contact us by email or phone at 416-481-5604 to book a consultation.
Most people who have written a will have likely considered how they would like to distribute their home, money, and other material possessions. But have you ever considered your non-tangible, digital assets and what may happen to those when you pass?
What Are Digital Assets?
Digital assets include much more than what’s on your computer. They include photos, videos, or documents stored in the cloud (i.e.: on third-party computers), e-books, music purchased online, accounts with money stored on them (such as payment processors or gambling websites), online tax planning records, domain and website registrations, online businesses, and passwords to various social accounts.. These can all add up to a considerable value. A 2011 study by the security software company McAfee, found the value of an Americans’ digital assets was approximately $37,438– a sum that that has likely gone up in the years since the study was concluded.
Canadian Law and Digital Assets
There is currently no law in Canada governing what happens to a person’s digital assets when they die, which makes it critical to consider these assets when planning your will. In 2016 a British Columbia widow was told she needed to get a court order before Apple would turn over her late husband’s iTunes password, which was needed to access everything the couple had purchased on their iPad.
Best Practices in Managing Your Digital Assets and Planning for the Future
While you may own many of your digital assets, in some cases you simply have a license to use them, with ownership belonging to the websites or companies hosting them. In any case, access to digital assets is governed by the terms of service of the company that hosts each. These policies vary from company to company, so it is important to understand what every individual policy is and to prepare your estate accordingly, so they can be accessed easily upon your passing. When planning your will, you should talk to your estate-planning lawyer about including language pertaining to your digital assets. It may be a good idea to include clauses allowing your executor to handle your digital access. While such clauses are currently not supported by legislation, they could demonstrate what your intentions were in regards to your digital assets. Additionally, you may want to allow your executor to access your digital assets. This can be done by leaving directions on how to find usernames and passwords for all of your accounts. For example, you can leave a list of passwords in a safety deposit box or safe. Of course, it is important to keep this information up to date. There are also password management applications that allow users to name a beneficiary of a user’s passwords. It should be noted that allowing your executor to access your online accounts may violate a site’s terms of service. It would be helpful to review individual accounts with your lawyer. When planning for how your digital assets will be handled, consider which assets you would like to give to someone, and which assets you would like disposed of for privacy, business, or personal reasons. Contact the lawyers at NULaw if you are planning your will or have questions about your estate. We can be reached online or by phone at 416-481-5604. We can help you not only in the preparation of legal documents, but also in the long term planning of your estate and how you can help your children or loved ones once you are gone.
When a party applies for a retroactive change in spousal or child support, it is not enough to simply prove a material change in circumstances. Both the appropriate level of retroactive relief, as well as the retroactive date must be established. In 2016, the Ontario Court of Appeal issued a decision in Punzo v. Punzo, 2016 ONCA 957, reinforcing the proper analysis for such an application.
An Agreement is Reached, Circumstances Change
The facts in the case are fairly straightforward. Both the Mother and the Father consented to a Support Order based on the Mother’s annual income of $36,000 and the Father’s annual income of $105,000. This resulted in spousal support payments of $1,700 per month and child support payments of $919 per month, for a total of $2,619. However, both parties agreed the Father’s income was not actually $105,000 at the time the Support Order was agreed to. Instead, that amount was the income the Father expected to earn as a salesperson. What’s more, the Father lost his job and accepted another at a lower income after the Support Order was consented to. The Motion Judge found the Father’s new job at a lower salary did constitute a material change warranting a reduction in child and spousal support amounts. Furthermore, the Motion Judge held the amounts agreed to at the time the Order was negotiated would have been different had the current circumstances been in effect at the time the decision was made. As a result, spousal and child support were retroactively reduced to $446 and $647 per month respectively. Furthermore, spousal support would drop to $0 and child support would drop to $444 per month nearly one year later on January 1, 2014.
No Error in Finding Material Change
The Mother appealed the Motion Judge’s order, arguing the Judge had erred in finding that a material change had occurred. This position stems from the Father admitting his income was never $105,000. The Court accurately summed up the meat of the appeal, stating
how could the continuation of the status quo constitute a material change in circumstances?
The Court found the Motion Judge had made no error in finding a material change in circumstances – the Father had lost his job and accepted a new one at a lower wage. If he had his new job at the time the Support Order was consented to, a different agreement would likely have been made.
But, There’s More to It
While the Court found no error in the Motion Judge’s finding of a change of circumstances, it went on to find that the Motion Judge stopped short of performing a proper analysis as set forth by the Supreme Court of Canada in S.(D.B.) v. G.(S.R.) While the test in that case was written with increases in support in mind, the Supreme Court would later hold the same analysis should apply to retroactive decreases in support. The analysis from the Supreme Court means even if a material change of circumstances is found, both the appropriate level of retroactive relief (i.e.- is relief needed based on ability to pay, or based on a change in circumstances?) as well as the retroactive date and quantum of support must be determined (the date of effective notice, or a different date). Having found the Motion Judge failed to apply the test set out in S.(D.B.) v. G.(S.R.), the Court remitted the matter back to the Motion Judge for a proper determination of the amount of support to be paid and the effective date of change. If you are going through a separation, the lawyers at NULaw can help you with our pragmatic approach to family law issues. Visit our website for more information on how child support is calculated in Canada. Contact us early in your separation to ensure the best possible support outcome for your children. We can be reached online or by phone at 416-481-5604.
While most people understand the importance of having a will, not everyone thinks about a power of attorney, a document which is just as, if not more important, than a will. It is not pleasant to think about, but there may be a time when you are unexpectedly unable to manage your personal or financial affairs and will need someone else to do so. Planning ahead for times like this is important and can give you and your family peace of mind.
What is a power of attorney, and why might I need one?
A power of attorney document gives someone the legal right to act on your behalf should you become unable to do so. Why might you want to appoint another person to handle your legal or financial affairs? Perhaps you’re planning on being out of the country for an extended period of time and need someone to manage your property or banking matters, or perhaps you want to plan for the unfortunate possibility that you may become ill and unable to make legal or financial decisions.
Are there different types of power of attorney?
The first common type of power of attorney is a Continuing Power of Attorney for Property. This is a legal document in which one person gives another the legal authority to make decisions about their finances. It is called a “continuing power” because it can be used after the person who gave it is no longer mentally capable of making financial decisions themselves. The types of responsibilities that would fall on a Power of Attorney for Property include paying bills and taxes as well as managing property and investments. An important point to make is that the power of attorney does not authorize someone to give away property after the grantor’s death (which is why you still need a will). The second common type of power of attorney is a Power of Attorney for Personal Care, in which one person gives another person the authority to make decisions about personal care on their behalf if they should become mentally incapable to do so themselves. The types of responsibilities that would fall on a Power of Attorney for Personal Care include decisions on how you would dress, where you would live, what you would eat, and what type of health care you would receive.
Who should I appoint as my power of attorney?
A power of attorney doesn’t actually have to be an attorney. People often choose family members or close friends – regardless of who you choose, it should be someone you trust completely and who you think is capable of handling the responsibilities given to them, as well as someone who you are confident will act in your best interest. The person you appoint as your attorney will have significant power over your property. You want to choose someone who you are confident will not misuse this power. Do not pick anyone whose motives you are unsure of, nor anyone who may be pressuring you to appoint them. It’s also important to talk to the person you are considering appointing in order to make sure they agree to assume the responsibility should it fall on them. It is also possible to appoint more than one attorney. There are a number of ways two attorneys could be appointed. You may want to appoint a single power of attorney as well as a substitute, should the primary attorney become sick or unable to perform their duties. Alternatively, two attorneys could share or divide responsibilities. If you decide to appoint two attorneys to share responsibilities, the law will require them to make decisions together unless you specifically give them permission to act separately. When appointing joint attorneys it is important to specify how any disagreements between the attorneys will be resolved. There is a valuable sense of security in planning or your financial and medical well-being before you are unable to do so. The lawyers at NULaw are experienced in helping our clients prepare for their future and would be glad to speak to you about how we can help you. Contact us online or by phone at 416-481-5604 today to discuss any of your estate planning needs, including power of attorney.
Can a work schedule that prevents one from exercising visiting rights with a child prevent the other parent from moving the child further away, thus exasperating an already difficult situation? The Ontario Superior Court recently ruled in the affirmative.
A Busy Workload
The parties in this case were the divorced mother and father of a three-year-old child. The child lived with the mother, who shared custody and decision-making responsibilities with the father. The father was in the military, and his job often required him to be away for short periods of time. As a result, he was unable to spend 50% of his planned days and weekends with the child, requiring the mother to assume additional parental responsibility. As a result of this, the mother brought a motion to allow her to move from the Ottawa area to Toronto. She had family, friends with kids, and a boyfriend living in Toronto whom she planned to marry. She was also offered a job in her field, as a real-estate agent, that would pay more than her job in Ottawa. In response to the mother’s request, the father argued the move would be detrimental to the child because it would take her farther away from him.
Applying Gordon v Goertz
In cases where parents wish to move a child to another city or jurisdiction, the court must determine two issues as set out by the Supreme Court of Canada in Gordon v. Goertz. The first is whether the parent seeking the move could demonstrate a material change in circumstances. The second is which of the parties parenting plans would be in the child’s best interest. In this case, the Court determined the mother’s plan to move and remarry would amount to a material change in circumstances unforeseen at the time of the separation agreement was entered into. The child would certainly have less access to her father. However, regarding the second part of the analysis, the Court found the mother had put the child ahead of her career, while the father had done the opposite. The Court considered this a strong factor in the best interests of the child, and determined the relationship between mother and daughter must be maintained. The Court also found the mother’s proposal of granting the father visitation every second weekend (with the child being handed off midway between Ottawa and Toronto) would not result in substantially less access time for the father since he frequently cancelled his scheduled access anyways. The Court determined the mother was not moving with the intention of depriving the father of access. Lastly, the Court performed an analysis as to whether there would be a significant disruption to the child’s family, schools, and community. Since the child was only three, she had not started school yet and there would be minimal disruption to her every day life. The mother’s request was ultimately approved by the Court. The divorce lawyers at NULaw can help you with the important decisions to make during a separation and divorce. Our lawyers can help you navigate custody and access disputes, including child support, spousal support, and division of property. We help our clients understand their rights, allowing them to make informed, rational decisions. Contact us online or call us at 416-481-5604 to schedule your consultation.
In what is a striking reminder to review wills that were made a long time ago, the Ontario Superior Court of Justice has ruled that a man born out of wedlock can be excluded from his grandmother’s inheritance.
A Brief Family History
Jesse Sullivan, the Respondent, was born in 1988. His father, George, was one of two sons born to Jadwiga Koziarski. George died in 2013, while his mother, Jadwiga, died in 2016. George married his wife in 1991, three years after his relationship with the Respondent’s mother ended – he and the Respondent’s mother were never married. George went on to have one other child with his wife. Jadwiga’s other child, Henry – the Petitioner – had two children with his wife. Following Jadwiga’s death, the Petitioner argued that the Respondent was not entitled to a share of Jadwiga’s estate. Jadwiga’s will provided as follows about the distribution of her estate: “To divide the remainder of my estate equally among such of my children as shall be living at the time of my death; provided that if any of my children shall predecease me, leaving issue him or her surviving, such issue shall take in equal shares per stirpes the share that such deceased child would have taken if living.” Jadwiga was predeceased by her son, George. While George himself had spent little time with the Respondent once George married, there was evidence that Jadwiga and her husband had cared about the Respondent; they had set up an RESP for him. Despite this apparent relationship, the Petitioner argued that there were strict legal definitions associated with terms such as “child” and “issue” at the time Jadwiga’s will was drafted which precluded the Respondent.
Children Born Out of Wedlock: Introduction of the SLRA
Today, children born out of wedlock are afforded the same rights as children that are a product of a marriage. However, due to common law practice, children born out of wedlock were excluded from the definition of “child” and “issue” prior to March 31, 1978. It was at that time that the Succession Law Reform Act (SLRA) was passed, and explicitly stated that commonly used terms in estate law, such as “child” and “issue”, would include any children born out of wedlock. Jadwiga’s will was signed in 1977, one year before the SLRA was passed. Had Jadwiga’s will been written a mere four months later, there would have been no question around whether the Respondent was entitled to an inheritance. Lawyers for the Respondent submitted that Jadwiga would likely not have known that the will, as it was drafted, would exclude the Respondent. However, the Court stated, “As is invariably the case, the issue in construing any will is to determine the intention of the testator.”
The Court’s Ruling
The Court wrote, “The old presumptive rule was that in construing neutral terminology, such as the word ‘child’, in the absence of evidence of surrounding circumstances showing a contrary intention, it was presumed that that sort of terminology included only “legitimate” children or grandchildren, that is, children or grandchildren born of parents who were married.” The Court added “where policy choices are made by the legislature they must be respected by the courts.” Unfortunately for the Respondent, the court added, “it remains the case that wills made before the effective date of the Act are treated differently than those made after that date.” NULaw can provide you with legal guidance around all of your estate planning needs. Please reach out to us online or at 416-481-5604 to discuss powers of attorney, wills, or other estate planning needs. Our team of experienced estate lawyers will work with you to reach your long-term goals and objectives and help you protect yourself and those you love.
The Ontario Court of Appeal has upheld the dismissal of a claim filed by a man seeking $4 million in damages from his ex-partner for giving birth to their child without his consent. In his claim, the Plaintiff sought damages for “non-pathological emotional harm of an unplanned parenthood.” The Plaintiff appealed to the Court of Appeal after a trial judge found no legal basis for his claim.
The Back Story
The Plaintiff met the Defendant in 2014 through a mutual friend. They had a brief relationship, which lasted for two months. During that time they engaged in consensual intercourse on a number of occasions. The Plaintiff understood that the Defendant was taking the birth control pill and that she did not wish to become pregnant. Their relationship had been over for several weeks when the Plaintiff learned that the Defendant was 10 weeks pregnant. She later gave birth to a healthy child and a paternity test confirmed the plaintiff was the child’s father. The Plaintiff’s original claim sought damages due to sexual consent obtained through deception and dishonesty. The court of Appeal wrote, “’he wanted to meet a woman, fall in love, get married, enjoy his life as husband with his wife and then, when he and his wife thought the time was ‘right’, to have a baby.’ He pleaded that he consented to sexual intercourse with DD on the understanding that she was using effective contraception. In his view, this was an express or implied misrepresentation and his consent was vitiated, having been obtained through deception and dishonesty.” While he accepted the responsibilities of fatherhood, and had been making child support payments, he was suing “just for the non-pathological emotional harm of an unplanned parenthood.”
Trial and Court of Appeal
The Trial Judge explained that the Plaintiff could have pursued several causes of action arising from what happened that may have supported a claim for the emotional harm he described. The Trial Judge found “instead of employing those causes of action, PP has twisted and distorted the tort of fraudulent misrepresentation, normally an economic loss tort, into a novel emotional harm cause of action. In my opinion, it is plain and obvious that fraudulent misrepresentation is not the legal vehicle for a claim for the emotional harm arising from unplanned parenthood. I, therefore, strike out his Statement of Claim for fraudulent misrepresentation.” The Trial Judge determined that the Plaintiff should not be allowed to pursue these other causes of action because there were no grounds to support his claim of emotional hardship, such as sexual battery. The Court of Appeal summarized the Trial Judge’s finding, concluding “In other words, the motion judge found that PP’s sense of violation arose not from the sexual touching to which he ostensibly consented, but from the spoiling of his later plans by the birth of an unplanned child.” If you are involved in a dispute over paternity or child support, your first step should be to understand your rights and obtain the best possible child support arrangement for your children. NULaw and its predecessors have been helping clients in Toronto since 1953. Our lawyers provide clear, practical advice so that clients can make informed decisions about their parental rights. Contact us online or at 416-481-5604 to book a consultation.
Many couples do not think that they need a prenuptial agreement because they do not own significant assets. Indeed, the use of a prenuptial agreement (more commonly referred to as a pre-nup, and also known as a marriage contract), is often associated with celebrity or professional athlete marriages, since such agreements are often a given in high-net worth relationships where substantial assets are involved. Many more couples are opposed to the thought of making such a contract with their partner, believing that having a prenup indicates that a marriage is doomed before it even begins, since the very nature of a prenup contemplates the end of a marriage. However, there are many benefits of having a prenuptial agreement and a prenup is something that all couples who are planning to get married should consider.
What is a Pre-nup?
The Ontario Family Law Act contemplates domestic contracts, which is an umbrella term that can refer to a number of agreements, including a marriage contract, cohabitation agreement, or separation agreement. Section 52(1) of the Act specifically defines “marriage contract” as an agreement entered into by two individuals who are married to one another (or who intend to marry one another), which sets out their respective rights and obligations during the marriage, or in the event of separation, annulment, or death. Prenups can be entered into by both same-sex, and opposite sex partners. They can also be entered into after you are already married (sometimes called a postnup), with the same concepts applying.
What Can be Included in a Pre-nup?
Section 52(1) outlines what can be included in a marriage contract, including:
- Ownership of or division of property, including personal property such as pets;
- Support obligations;
- The right to make decisions about “education and moral training” of their children.
Certain things that prenups cannot address are custody of and access to children. Prenups likewise cannot limit a spouse’s possession rights to the matrimonial home.
In addition to outlining details of property and asset division, as well as decisions pertaining to child-rearing, prenups can also address any number of day-to-day aspects of marriage . These are known as “lifestyle clauses” and can include things such as frequency of visits from in-laws, social media clauses, division of labour clauses, and similar. Depending on the nature of the lifestyle clauses included, they may be difficult to enforce, as violations may be challenging to prove.
Benefits of a Pre-nup
Pre-nups can be an effective way to protect your assets and interests in the event of a breakdown of the relationship. They can also minimize conflict or avoid future litigation by carefully outlining how the couple will deal with many major issues that can become contentious during a separation or divorce. This can be helpful even if you are not Beyonce and Jay-Z, or any other incredibly wealthy couple. Furthermore, rather than cursing a marriage or indicating its inevitable end, the process of negotiating a prenup can actually be beneficial: helping couples communicate, to address major issues fundamental to a relationship, and to agree on what they want in their relationship in advance of taking the big step of getting married. Discussing expectations in advance of a marriage can help a couple identify any potential problems in advance, and can ultimately foster a healthier relationship. If you do decide you would like to enter into a prenup before you get married, or if you are already married and want a postnup drafted, you and your partner will have to see a separate lawyer and each obtain independent legal advice. The Toronto family lawyers at NULaw have many years of experience advising clients on all domestic contracts including prenups, postnups, and cohabitation agreements. Our ultimate goal is to protect property and other assets of each of our clients, and mitigate any future risk they may face in the event of a marriage breakdown. Contact us online or at 416-481-5604 to book a consultation.