FACT OR FICTION? FAMILY LAW SEPARATIONS – Part I
Clients may convince themselves of the accuracy of the information they receive from a friend at the gym or an erstwhile cousin who has already taken the emotional journey of separation and divorce. Their pronouncements about how child support is calculated or the entitlement thresholds for spousal support may be well-intentioned yet perhaps not exactly accurate.
First, let’s look at a few myths about homes, child support, and inheritances and expose the truth. I’ll give you the short answer and some questions and brief information to reflect on. I’ll then offer a quick guide to the process options.
If I own a home overseas it’s clearly excluded marital property.
The short answer is: Maybe Fact or Fiction
The questions to ask:
- Was there a cohabitation agreement executed pursuant to Ontario Family Law Act and what does it say about this property?
- When and how was the home acquired?
- How was ownership taken?
For married spouses, the Ontario Family Law Act provides a detailed scheme for the division of property based on ownership and the net value of the property. How the land was acquired and the use of the property may affect how it is treated under Ontario family law.
Property is defined, in part, as “any interest, present or future, vested or contingent, in real or personal property…” If the property was acquired before or after the date of marriage and was used on a regular basis as a place for family gatherings, sibling vacations, or a seasonal spousal retreat it will be treated as a matrimonial home. Although a matrimonial home has special status under Ontario family law, its net value will not be excluded from sharing with the non-titled spouse.
Quick Guide:
Litigation, Traditional Negotiation, Collaborative and Meditation: In all processes, you will be required to prove ownership and use. In the formal Litigation process and perhaps in the Traditional Negotiation the proof will be provided by sworn affidavit. A court order as to the inclusion or exclusion of the value of the property will be rendered by a Judge if the parties are not able to agree on a consent order relating to the issue.
In the Collaborative and Meditation process, the proof of ownership and use will be uncovered through discussions between the spouses. Any decision on the issues will be by mutual agreement of the spouses on consultation with their respective lawyers.
If I receive an inheritance before we marry, it’s all mine.
The short answer is: Maybe Fact or Fiction
The questions to ask:
- Was there a cohabitation agreement in place before the date of marriage?
- Was the inheritance used to purchase a jointly held asset such as an investment or a home which after the date of marriage subsequently became a matrimonial home?
If the inheritance was received prior to the date of marriage and nothing was retained or owned by the recipient as at the date of marriage, then there may be nothing to consider. The inheritance is gone. Similarly, if the asset and its income stream were excluded from sharing in a cohabitation agreement signed by both spouses and meeting the formal requirements of a domestic contract, then yes, it’s all yours. Upon marriage, the cohabitation agreement will become a marriage contract.
You can decide whether you would like to share some or all of the inheritance by gift, Will or other disposition. The cohabitation agreement or marriage contract may require an amendment to safeguard the gift from any claim of wrongdoing by someone who may have a right to the inheritance.
If the original inheritance led to a subsequent purchase or acquiring of a house, then care must be taken about who owned the property and use of the house after the spouses wed. Was the house rented to a third party or used as the matrimonial home? The focus may move to whether the property will have a special status as a matrimonial home.
Quick Guide:
Litigation, Traditional Negotiation, Collaborative and Meditation: In all processes, proof of receipt of the whole of the inheritance and a paper trail showing its disposition or use will be required. In Litigation and most often in the Traditional Negotiation processes there will be sworn affidavits and even forensic accounting to confirm the source and use of funds if the authenticity of the deponent’s evidence is in doubt. A court order may be granted to compel the production of such evidence before the matter is finally determined by the Judge. A third party claiming a right to the inheritance may join the court process.
In the Collaborative and Meditation processes discussions between the spouses will uncover the ownership and use of the inheritance. If doubt persists, third parties may be interviewed and other documents requested. The spouses will reach a mutual agreement on any decision. Sometimes a mediator will join the Collaborative process to resolve a difficult piece or unravel any resistance to resolution. The final decision regarding the inheritance will become a provision in the separation agreement.
I am not responsible for the child support of my spouse’s children from a previous relationship.
The short answer is: Maybe Fact or Fiction
The questions to ask:
- What role, if any, did you play in the children’s lives?
- Specifically, to what extent did you make decisions for the children’s welfare, express authority and become involved in family life?
The payment of child support only arises when parents, biological and adoptive, of a minor or in some cases adult child separate. There is another class of parents who will also be looked to when the issue of paying child support arises. These are the spouses who assume a parental role of the children of their partner or spouse. Parental status is assumed when they provide for the children in all aspects of the child’s life: offering guidance, education, and discipline, and generally caring for the children as their own.
Quick Guide:
Litigation, Traditional Negotiation, Collaborative and Meditation: In the Litigation process the terms of child support including all parents responsible for paying the support will be set out in the court order. Any amendments or variations to the child support order will necessitate a subsequent court process. In the Traditional Negotiation, Collaborative and Meditation process the child support provisions will be negotiated and included in a separation agreement. Any changes to these original terms will be by Amending Agreement.