Family (Kierstead) - 2020 PDF

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Very detailed and organized course notes, include notes from class and assigned readings. Important notes for exams are included....

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Family law – 2020 Unequal Shares of Equalization Family Law Act 5(6) The court may award a spouse an amount that is more or less than half the difference between the net family properties if the court is of the opinion that equalizing the net family properties would be unconscionable, having regard to, (a) A spouse’s failure to disclose to the other spouse debts or other liabilities existing at the date of the marriage; (b) The fact that debts or other liabilities claimed in reduction of a spouse’s net family property were incurred recklessly or in bad faith; (c) the part of a spouse’s net family property that consists of gifts made by the other spouse; (d) a spouse’s intentional or reckless depletion of his or her net family property; (e) the fact that the amount a spouse would otherwise receive under subsection (1), (2) or (3) is disproportionately large in relation to a period of cohabitation that is less than five years; (f) the fact that one spouse has incurred a disproportionately larger amount of debts or other liabilities than the other spouse for the support of the family; (g) a written agreement between the spouses that is not a domestic contract; or (h) any other circumstance relating to the acquisition, disposition, preservation, maintenance or improvement of property Sullivan v. Sullivan 1986 ON Facts: H completed a BA then an MA at York, W worked full time, supported H, provided child care, paid for H’s tuition, and managed family affairs, W owned corporation that operated a catering business at time of separation Decision: patently and grossly unfair for H to get any part of the corporation Ratio: test for unconscionability is a subjective test and must be applied to all facts involving the three ingredients contained in s. 5(7) and six factors in s. 5(6) Application: contribution made to family unit during year was staggeringly uneven in all three major areas of contribution to family, child care household management and financial position Note: professional degrees are not property Waters v. Waters ON Facts: 30 year marriage. W and H work at factory. W claimed unequal division of family property because H was alcoholic and was not responsible with money and that she had greater share of household duties Ratio: court is authorized to order an unequal division of family property only pursuant to s. 5(6) and only in those cases where an equal sharing would be unconscionable Rule: mere differences in capabilities does not amount to unconscionability Note: departures from equality should be uncommon Leblanc v. Leblanc 1988 SCC Facts: 7 children born to H and W. H suffered from alcoholism and W really supported the family. W bought land and H did some construction on it. Ratio: where the property has been acquired exclusively or almost wholly through the efforts of one spouse and there has been no or a negligible contribution to child care, household management or financial provision by the other, then there are circumstances relating to the acquisition, maintenance and improvement of property that entitle a court to exercise its discretion Application: unequal distribution

Merklinger v. Merklinger 1992 ON Facts: H & W married for 18 years, H sold assets contrary to preservation order, allowed mortgage on cottage in W’s name to go into default, sold cottage for less than mortgage, W registered a mortgage on matrimonial home in her name to pay debts Ratio: unconscionability is the threshold Application: outrageous behaviour can result in no equalization payment and contempt of court Fillipponi v. Fillipponi 1992 ON Ratio: a reckless depletion of assets by one party which shocks the court can lead to unequal equalization distribution Abaza v. Abaza 2000 ON Facts: H created significant debts in relation to use of escort services Ratio: depletion of assets recklessly means no equalization Application: H not entitled to exclude debt from NFP Hines v. Hines 1988 ON Facts: 2nd marriage for both H and W, in their 60s, W brought house into marriage, H brought debt Ratio: FLA must be read as a whole to result in an orderly and equitable settlement of their affairs upon marriage breakdown Application: lump sum support entitlement for W offsets some of H’s equalization, H given judgment for 10,000 but W gets 10 years to pay it off Note: don’t use this as a strong precedent according to Kierstead MacNeill v. Pope 1999 ON CA Ratio: cohabitation in s. 5(6)(e) includes pre-marital as well as marital cohabitation Futia v. Futia 1990 ON Facts: parties married less than 2 years, W alleging physical and mental cruelty in divorce petition, H owned matrimonial home Decision: equalization at 40% instead of 50 Ratio: it would indeed be unconscionable for W to receive an equal division when she had contributed virtually nothing to the acquisition of matrimonial home whose value increased substantially btn date of purchase and date of separation Application: unequal share is appropriate under 5(6)(e) Note: matrimonial misconduct per se is not relevant to proceedings for distribution of matrimonial property Serra v. Serra 2009 ON CA Facts: H owns a large business in textile industry. The property is worth over 10 million dollars at valuation date but the industry has suffered huge decline due to market forces and recession hits. Dramatic change not due to any fault on part of H, also there was a court order forbidding him to sell company in the interim Issue: whether a market-driven post-valuation date change in the value of a spouse’s assets may be taken into account in determining whether an equalization of NFP is unconscionable under s. 5(6) Ratio: market-driven decline in value of a spouse’s assets may be considered as a factor in determining whether an equalization of NFP is unconscionable

Rule: concluding that market-driven decline is a factor does not lead to a finding on the facts that an equalization order is unconscionable Application: court’s conscience would be shocked if equalization allowed Note:  if find equalization to be unconscionable, the court should then exercise its discretion to create an order that is fair, just and equitable in the circumstances  a formal admission of fact, as distinct from an admission of law, cannot be withdrawn except by leave of the court or on consent, whereas an admission relating solely to a question of law can be withdrawn at any time  no constructive trust as there was no deprivation suffered by W  do not substitute valuation date for trial date: judge took amount at trial date and added a little more in case bis picks ups again Kean v Clausi: Facts:In 2005, parties refinanced matrimonial home and increased mortgage, H wanted to use funds to invest in high risk investments using equity in MH. Approximately 200,000 of re-financing was invested in investment account in Wife’s name alone (Wife said this was a credit-proofing strategy). H made all decisions relating to account. At date of separation account value was 228,168. At time of application value was 145,158 and at time of trial it was 157,000. Parties agree that post-separation decline was entirely market driven Issue: What impact on equalization in light of Serra? Decision: Serra gives ct authority to take into account this particular situation. Husband says Serra is distinguishable and facts don't rise to same unconscionability level. Ct disagrees, shouldn't be limited to extreme cases involving only very wealthy. Say that decrease in value in account hat was created by husband shouldn't only impact wife.

Matrimonial Home Family Law Act 18. (1) Every property in which a person has an interest and that is or, if the spouses have separated, was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence is their matrimonial home. (2) The ownership of a share or shares, or of an interest in a share or shares, of a corporation entitling the owner to occupy a housing unit owned by the corporation shall be deemed to be an interest in the unit for the purposes of subsection (1). (3) If property that includes a matrimonial home is normally used for a purpose other than residential, the matrimonial home is only the part of the property that may reasonably be regarded as necessary to the use and enjoyment of the residence. 19. (1) Both spouses have an equal right to possession of a matrimonial home. (2) When only one of the spouses has an interest in a matrimonial home, the other spouse’s right of possession, (a) is personal as against the first spouse; and (b) ends when they cease to be spouses, unless a separation agreement or court order provides otherwise. 20. (1) One or both spouses may designate property owned by one or both of them as a matrimonial home, in the form prescribed by the regulations made under this Act. 24. (1) Regardless of the ownership of a matrimonial home and its contents, and despite section 19 (spouse’s right of possession), the court may on application, by order,

(a) provide for the delivering up, safekeeping and preservation of the matrimonial home and its contents; (b) direct that one spouse be given exclusive possession of the matrimonial home or part of it for the period that the court directs and release other property that is a matrimonial home from the application of this Part; (c) direct a spouse to whom exclusive possession of the matrimonial home is given to make periodic payments to the other spouse; (d) direct that the contents of the matrimonial home, or any part of them, (i) remain in the home for the use of the spouse given possession, or (ii) be removed from the home for the use of a spouse or child; (e) order a spouse to pay for all or part of the repair and maintenance of the matrimonial home and of other liabilities arising in respect of it, or to make periodic payments to the other spouse for those purposes; (f) authorize the disposition or encumbrance of a spouse’s interest in the matrimonial home, subject to the other spouse’s right of exclusive possession as ordered; and (g) where a false statement is made under subsection 21 (3), direct, (i) the person who made the false statement, or (ii) a person who knew at the time he or she acquired an interest in the property that the statement was false and afterwards conveyed the interest, to substitute other real property for the matrimonial home, or direct the person to set aside money or security to stand in place of it, subject to any conditions that the court considers appropriate. (3) In determining whether to make an order for exclusive possession, the court shall consider, (a) the best interests of the children affected; (b) any existing orders under Part I (Family Property) and any existing support orders; (c) the financial position of both spouses; (d) any written agreement between the parties; (e) the availability of other suitable and affordable accommodation; and (f) any violence committed by a spouse against the other spouse or the children. (4) In determining the best interests of a child, the court shall consider, (a) the possible disruptive effects on the child of a move to other accommodation; and (b) the child’s views and preferences, if they can reasonably be ascertained. OLRC Report on Family Property Law  matrimonial home is more than a valuable asset, spouses develop emotional attachment to it  right to occupy matrimonial home satisfies one of the basic needs of individuals in society, need for accommodation  equal division of property frequently results in forced sale of couple’s family residence  legislature should introduce a more limited amendment to ensure al changes in capital value of home are included in NFP of owner  recognizes special contribution to preservation and maintenance of a shared family residence made by many non-titled spouses  recommended eliminating matrimonial home for purpose of deduction and exclusion Rosenthal v. Rosenthal 1986 ON Facts: three sons living in matrimonial home, W applying for exclusive possession, 2 sons unemployed but have income, third is a resident and H is paying support for him Ratio: party applying for order must establish on balance of probabilities that they fall within the provisions of s. 24(3)

Rule: s. 24(3) Application: there are insufficient funds to continue the occupation of the matrimonial home, has failed to satisfy legislation adult kids are not a compelling reason for H to have to maintain 2 households Pifer v. Pifer 1986 ON Facts: W alleges increased drinking by H has lead to arguments affecting and frightening children Ratio: s. 24(4) not restricted to disruptive effects of the move or child’s preferences but may include other factors such as psychological stress and strains to a child arising out of daily friction btn parents, husband was a risk Rule: best interests of the children Application: W to have custody of the children and exclusive possession of matrimonial home Hill v. Hill 1987 ON Facts: H on a letter campaign to intimidate W into settling for less Decision: interim order for exclusive possession Ratio: s. 24(3)(f) must surely include in the meaning of violence that violence causing injury to spouse which can be achieved by words and deeds and is not restricted to the violence which can be achieved solely by physical abuse Rule: 24(3) Application: W can least afford to move, violence has been done to emotional equilibrium, continuation of joint cohabitation in matrimonial home is impractical, H has other accommodation options Note: H also did not have proper disclosure of financial assets and fund transfers Behrendt v. Behrendt 1990 ON Facts: W applying for interim order for exclusive possession of matrimonial home under s. 24 of FLA, H suffering from depression and has nowhere to go Rule: courts must take into account best interests of the children affected and any violence committed by one spouse against the other or the children Application: the nature of the allegations, contradictory view presented by one child and age of children at home militate against exclusive possession Note: three months after decision, H murdered W then committed suicide -case demonstrates issues surrounding evidentiary burden of proving violence Wilson v. Wilson 1989 ON Facts: H has serious drinking problem, committed acts of violence against W resulting in criminal charges, spouses operating separate households within matrimonial home Ratio: in family violence situations with few financial resources, courts can grant exclusive possession of matrimonial home even though winning party will have to accommodate needs beyond the other’s ability to pay Rule: 24(3) Application: best interests of the child, violence, economic circumstances and lack of alternatives militate toward finding of exclusive possession Paul v. Paul 1986 SCC Ratio: BC legislation cannot be used to grant occupancy rights in a matrimonial home located on a reserve to the W Wynn v. Wynn 1989 ON

Ratio: courts cannot make an order for exclusive possession of a matrimonial home on a reserve but can make an in personam order restraining other party from interfering with spouse’s possession of matrimonial home

Pensions

Settlement Options – Key Issue

Trade of Cash or Other Assets        

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“If and When” Arrangements

Lump Sum Transfer of Share of Member’s Interest in Plan

Proposed Legislation aims to reduce “dueling actuaries” defined benefit pensions Non-member spouse to be paid at the time of separation the present value of his or her share of the plan on the valuation date Amount will usually to be placed in a locked-in RSP Details to be worked out through Regulations; pensions to be valued by pension plan administrators in accordance with regulations Contributions after separation not considered by the courts Defined as property under s. 4 of FLA Two main types of plans: Defined contribution plans, easiest from division point of view o Plan where you get your benefit determined based on accumulated contributions that the employee and employer have made. Benefit is a return on investment. What is the aggregate accumulated during marraige o You have to figure out their value at valuation date!  Aggregate contributions through marriage  Return on investment at valuation date Defined benefit plan o Benefit is not directly linked to contribution o Years of service based on last 5 years (your best years) o Present value: amount that would have been invested as at valuation date in order for the original investment and accumulated earnings to be enough to fund monthly benefits when pension comes into play, figured out by an actuary o Figure out what the state of your fund would be that would have been paid out at retirement

Point of note: because it is not linked directly to your contributions, because it’s formula based, formula separate from contributions, it leads to many uncertainties in way you calculate present value Now what happens is that pension plan administrator will go through simplified valuation process to determine the imputed value of the pension and that process is delineated through s.10.1(1) of FLA and Pension Benefits Act. Double dipping issue: what happens if pension is valued as part of NFP and spouse is faced with spousal support claim after retirement? o

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Best v. Best SCC Notes:  If pension already in place at date of marriage, need to deduct pre-marriage amount from NFP  Do this by the pro rata approach: V-date value multiplied by quotient obtained when the # of years of pensionable service during the marriage is divided by the total # of years of pensionable service as of separation  Retirement method (assumes employee will continue until specified retirement age) might be appropriate in some circumstances Boston v. Boston 2001 SCC Facts: H’s pension determined in equalization calculation at time of divorce, also obliged to pay spousal support, when he retired, he began to receive pension payments, seeking to discontinue support on basis of double dipping Ratio: when a pension is dealt with by lump-sum method, the payee spouse must use the assets received on equalization to create a pension plan to provide for future support Rule: payee spouse should attempt to generate self-sufficiency Application: payee spouse cannot save the assets she receives on equalization and choose instead to live on liquidation of payor spouse’s pension when he retires McTaggert:  Disability pension included in NFP Bremner:  sick leave included in NFP Leckie:  If received after separation, severance not included in NFP (even though based on period of service during marital cohabitation) Personal Injury Damages:  Personal injury damages- any portion relating to compensation for wages- included in NFP (but recall other portions excluded under s.4 (2))

Cohabiting Couples Property Division   

Cannot use FLA to divide property-Nova Scotia v. Walsh Murdoch v. Murdoch-could not prove resulting trust but dissent held she could have proven constructive trust Rathwell v. Rathwell: constructive trust doctrine can be used for married couples as well as FLA

Pettkus v. Becker 1980 SCC

Facts: W contributed through her labour and earnings substantially to the good fortune of the common enterprise of the successful beekeeping business and property in H’s name, never married, trial judge awarded 40 beehives and some money Ratio: test for unjust enrichment: an enrichment, a corresponding deprivation and absence of any juristic reason for the enrichment, must in addition be evident that the retention of the benefit would be unjust in the circumstances Rule: for the unjust enrichment principle to apply it is obvious that some connection must be shown btn the acquisition of property and corresponding deprivation, extent of the interest must be proportionate to the contribution, direct or indirect, of the claimant Application: Constructive trust resulting in tenancy in common with property Notes:  Principle of unjust enrichment lies at the heart of the constructive trust as an equitable principle  Where one person in a relationship tantamount to spousal prejudices herself in the reasonable expectation of receiving an interest in property and the other p...