Separation Agreement Drafted – What’s Next?
Your relationship with your partner living common law or your spouse in a marriage has broken down. From the welfare of the children to your future financial stability to the long-term health of the family business on the line, you decide to seek legal advice.
You either have your family law lawyer work with you to consider all the relevant terms which will be drafted into a separation agreement, or you’ve decided to work in a collaborative fashion together with your independent counsel.
The first draft of the agreement has been presented to you for consideration. Here’s a survey of some of the questions you and your lawyer need to be alert to.
- Are the terms on point? Does the agreement provide for what was agreed upon in the negotiations? Does it include all you want it to cover? Do the terms recognize all forms of contribution to the business, family home, and growth of investment funds, including forfeited opportunities to help one spouse develop their career, sharing of domestic responsibilities and child care? The law recognizes the money’s worth of childcare as a valuable family contribution to be part of the spousal support considerations.
- Are the background facts sufficient to lay the groundwork in the event of a significant future change from the circumstances which existed at the time the agreement was negotiated? Does the agreement identify all sources of income for each partner or spouse, and identify mutual and individual expectations of the parties? Were reliable proof of the value of jointly and individually-owned property exchanged and was an independent valuation of the family enterprise conducted? Are health issues, joint family ventures, and excluded property documented and confirmed?
- Substantive vs procedural: The provisions relating to the substantive legal issues form the essence of the agreement. These issues are framed as decisions which come into effect typically once the parents commence living separately, upon divorce if they are married and, if they wish, upon the death of one or both spouses. If there are legislated or equitable rights and obligations entitling a spouse or partner to a right or benefit, such as property sharing or division, then the contract needs to clearly articulate all aspects of that decision to be effective and enforceable. The large clusters of rights and obligations, if you will relate to the children, property, and spousal support. Within each of these clusters, there is a myriad of related issues to be decided.
The procedural side of the agreement relates to when a provision takes effect and when it may terminate. There can be other provisions that relate to how to vary the terms of an agreement in the event of a substantial change in the assumptions and factual basis made at the time the agreement was executed by the partners or spouses. The economic impact of those changes to meet the financial obligation by one party and its continued direct or indirect impact on the recipient party or child may require further action to rectify and remedy the resultant consequences.
- Security for the support provisions: If a child or spousal support is to be paid from one partner or spouse to the other, has the agreement accounted for exigencies of the payor’s health, loss or interruption of income, death ensuring that there is no interruption in support payments? In the event, one spouse predeceases the other while a child remains entitled to receive support, have sufficient steps been taken to safeguard the child’s best interests?
- Internal consistency: To safeguard the enforceability of the negotiated terms, look for consistency between the substantial provisions ensuring that related terms and waivers do not conflict. For example, a plan of spousal support provisions stepped down over a decade should not be terminated prematurely by the inclusion of a support waiver which may inadvertently conclude the support payments before the final term has been satisfied. Similarly, if the agreement survives death, then the release provisions should mirror those allowances.