Q and A
- My spouse and I are about to separate and I would like to get some sense of what legal issues are involved.
Generally, the issues relate to the parenting of children, child support, spousal support, property division, and their various sub-issues. In most cases where the separation is permanent, a further issue is divorce.
- My spouse and I see things about our separation in the same way, can both of us use the same lawyer?
No. Each of you needs the services of an independent lawyer. The resolution of most issues is an option chosen from a range of options. The option that fits in any particular case can best be found by the client discussing his or her needs and concerns with the client’s own lawyer, followed by discussion between the two client/lawyer teams either with all four at the table, or by the lawyers between themselves as the clients’ representatives. Each client having his or her own lawyer ensures that the choices can be discussed, advice taken, and decisions made in private free from any influence of the other client. This right of private discussion and the legal advice involved is so highly valued in the law that any agreement reached without the parties having independent legal advice runs the risk of being unenforceable.
By far, most cases are settled by agreement between the parties without a court trial.
- If we don’t need temporary orders and can resolve all issues by agreement, do we need the court at any stage in the matter?
You don’t need the court except to process a divorce after all other issues arising out of the marriage and separation are settled by agreement. The usual practice is to see the progress to divorce as a two-stage matter with the divorce in the second stage. The first stage is the negotiation of a separation agreement that takes care of all the other issues.
- Are we “separated” if we are living apart from each other, but have not yet signed a separation agreement?
Yes. Your status as a separated spouse does not depend on whether or not you signed a separation agreement. You and your spouse are separated when you are living apart from each other, and one or both of you have made a permanent decision not to resume your life together. There is nothing in our law that requires you and your spouse to live together; therefore, there is nothing in the law that requires you to obtain permission from any authority or person to separate.
If you settle all matters arising out of the marriage and separation without going to court, the settlement should be recorded in a separation agreement even though a divorce is contemplated. The agreement must be in the form of a separation agreement to comply with the definition of a “domestic contract,” which has special properties in family law, and to meet the requirements for certain tax advantages that are available. Notwithstanding that it is a separation agreement, when properly drawn it is made to govern the rights and obligations of the parties with respect to each other on separation, divorce and death.
After the separation agreement is signed, the application for divorce is usually made by one or other of the parties although there is provision for the application to be made jointly by both of them. (A joint application is more complicated and of little practical benefit.) The most frequently used ground is marriage breakdown by reason of a separation of at least one year. In this case, the application can be made by either spouse. Sometimes, much less frequently, marriage breakdown by reason of adultery is the ground relied upon. Here, the application is made by the other spouse. (A third possibility, almost never used, is marriage breakdown by reason of cruelty.) The application is a simple form, and where there is a separation agreement the order requested is for a divorce only. The application is filed in the court, and a copy is delivered to the other spouse. Since all issues associated with divorce have been settled in the separation agreement and since there is no dispute about the ground for divorce, the other spouse has no reason to file an answer and lets the time for doing so go by. At this point, the spouse who made the application files the required affidavit and other documents in the court registry asking for an order for divorce. An official at the court checks the documents and if they are complete takes them to a judge who, in due course, dates and signs the divorce order without the need for the parties or their lawyers being present. The court official mails the divorce order to the parties. The divorce takes effect thirty-one days after the date of the divorce order. When this time has expired, an application can be made for a certificate of divorce that is needed for purposes of remarriage.
- If we live together for a short time after we separate to try to repair the marriage, does the year start all over again?
After spouses separate, they may live together for the purposes of reconciliation for up to ninety days at a single stretch or for several shorter periods totalling ninety days without interrupting the running of the time for divorce. For instance, if the spouses separate on May 1st, get back together for the month of June, and again for a number of days here and there for a total of ninety days or less, but are unsuccessful at reconciling their differences, the running time of the year that started May 1st is not interrupted for divorce purposes.
The main tax advantage is that where spousal support is paid under the agreement in a certain amount each month (or each regular period – e.g., weekly, or quarterly) the amount is deductible from the payer’s income for the purpose of calculating income tax and includible in the payee’s income for tax purposes. This is a saving in tax for the family if, because of a difference in tax rates, the total tax paid by the two persons is less than the amount they would have paid had there been no support involved and thus no support deduction being available. (This deductible/includible rule applies only to spousal support, and not to child support.)
- Is the same tax advantage available if, instead of periodic payments (that is, so much each week, month, or other regular period), I pay a lump sum to satisfy the support obligation?
No. The deductible/includible rule applies only to spousal support paid pursuant to a written separation agreement (or court order) in a sum certain on a periodic basis; i.e., paid weekly, monthly, or at some other regular period.
- Are the legal fees that I pay for advice on my rights, and the negotiation and preparation of a separation agreement deductible from my income for purposes of income tax?
Legal fees incurred on issues relating to periodic (weekly, monthly, or some other regular period) child or spousal support that are settled and recorded in a separation agreement may be deducted by the spouse receiving those payments, but the fees incurred by the spouse making the payments may not be. Where the issue is lump sum support, neither the spouse receiving the payment nor the spouse making the payment may deduct her or his fees. Legal fees incurred on other issues relating to advice, and the negotiation and preparation of a separation agreement are not deductible.
- What are the different methods that are available to resolve issues arising out of our marriage and separation?
There are five methods available to resolve these issues, and some of them can be used in combination with others. The five methods are:
- Collaborative Practice;
- Arbitration; and,
Each of these five methods will be discussed in turn.
Negotiation: In traditional negotiations, the lawyers for the parties explore each other’s positions on the issues involved and attempt to reach a mutually acceptable solution that avoids a trial. The process generally involves identifying the issues, exchanging all information relevant to the issues, submitting positions on the issues and the reasons for taking those positions, and exchanging offers and counter-offers.
Mediation: This method involves the use of a third party to help the parties set the agenda for the discussion of the issues and to facilitate this discussion toward agreement. The parties, not the mediator, make the decisions on the issues and the final decision on whether or not they are resolved in a way acceptable for recording in a formal agreement. The mediator has no power to force the parties to agree, or to decided the issues if they cannot. The mediation may be conducted with or without lawyers for the parties being present during the sessions to assist with the mediation. There are two types of mediation; open and closed. Open mediation is “with prejudice”. This means that if the mediation is unsuccessful, whatever is said in the sessions can be used in subsequent litigation or other proceedings. Sometimes at the request of the parties, the mediator will prepare a report containing an assessment of the issues presented in the mediation and the recommendations of the mediator. The benefit of open mediation is that the work done is not lost if the parties fail to settle. The disadvantage is that the parties, knowing what they say may be used against them in some other proceeding, become more guarded in the information exchanged and more polarized in their claims. Closed Mediation means that whatever is said is “without prejudice”. All communication in the mediation and any position taken is confidential and cannot be raised again in any other context. The advantage is that the clients are more open in the exchange of information, are less positional and negotiate more freely. What may be seen as a disadvantage is that if they do not settle their differences, no report can be obtained from the mediator for use in court either by way of a written report or by calling the mediator to give evidence as a witness. If the mediation is successful, the mediator will prepare a summary of the issues and their resolution which the parties then take to their lawyers for independent legal advice and the preparation of an agreement.
Collaborative Practice: In a sense, collaborative practice is mediation without a mediator. Each party is represented by a lawyer specially trained in the process and the parties and the lawyers enter into a commitment not to litigate. Instead of a confrontation in a “me against you” approach the lawyers and the clients work together to attack the problem and not each other. It’s a problem-solving exercise, not a fight, with the lawyers each protecting the interests of his or her client while advancing toward a “win-win” outcome. During the process, the clients retain control over the agenda and the outcome with the lawyers providing legal protection, negotiation coaching, and conflict mediation. Modern methods of dispute resolution are used in place of traditional positional bargaining. The process builds on the parties’ willingness to settle and appeals to the individual’s higher self -- looking to the future and refusing to become embroiled in the faults of the past. Depending on the needs of the parties and their family, other professionals with training in the collaborative process may be involved. These include financial planners with a background in accounting, or family professionals acting as child specialists or divorce coaches, who come from the fields of social work psychology.
Arbitration: This method involves appointing a third party to decide certain issues in much the same way that a judge would. The arbitration process can range from a full hearing similar to a trial with the arbitrator making an award (like a judgment) at the end of the hearing, down to a process resembling mediation with the distinction that the arbitrator acting as a mediator is empowered to decide certain issues, if the parties do not agree (mediation/arbitration). The advantage is that the clients can select the individual they want as an arbitrator (as opposed to the court system where a judge is assigned without consultation with the parties). And generally, arbitration is more expedient than the court process and less expensive. The disadvantage of arbitration is that the decision-making powers are taken away from the parties and given to a third person.
Litigation: Litigation is the court process that ends in a trial, if the matter is not settled along the way. The parties have much less control over the process than they do in the other methods of dispute resolution. Unless agreement is reached, decisions are made by a judge based on the evidence presented. Resort to this method may be necessary where there is no trust between the parties and co-operation is not possible; or the parties are entrenched in extreme positions and unwilling to compromise; or there is a pathological relationship. Sometimes, even in less dramatic situations, it is necessary to take steps in a legal proceeding for temporary orders to obtain, say, a stable arrangement for the parenting of children or financial support, or simply to bring the other party to the negotiating table. Whatever the reason for starting a legal proceeding, the chances of it going all the way to trial are remote. With the encouragement of the court, at some stage the parties and their lawyers usually find enough common ground to resolve the matter on mutually acceptable terms without further court involvement.
- My spouse has always been secretive about financial matters, and I have no information about our finances except for what I see on the statements for our joint account. Can I find out about what my spouse earns and the state of his investments?
Complete financial disclosure must be made by both parties. No settlement by agreement or court order can be made without full disclosure by each side of all relevant financial information. This involves the production of copies of income tax returns, and the completion by each party of a comprehensive form of financial statement showing income, living expenses, all assets of every description together with their value, and all liabilities. Documents verifying items in the financial statement may be required. Your lawyer cannot give you intelligent advice, and you cannot give your lawyer intelligent instructions on the resolution of financial issues such as support unless the information exchange is comprehensive and complete. Financial disclosure is the most important step in any negotiation. A failure to make complete disclosure may result in a settlement whether by agreement or court order being set aside.
The best interests of the children is the governing principle for determining all questions relating to their parenting. Many parents are able to put aside their differences on the adult level and by concentrating on the children’s needs, work out the most suitable parenting plan in the circumstances. Sometimes they will need help from a family professional with a background in social work to better understand what their children are going through and to help them manage any emotional conflict that interferes with the discussion staying on track. Your lawyer can make a referral for this purpose. A prime consideration in the planning will be to determine how you and the other parent can continue to be involved with the children and remain a significant part of their lives. In circumstances where the relationship between the parents is too damaged to co-operate on the planning, some variation of sole custody to one parent subject to access by the other parent is usually negotiated or ordered.
Where the child resides with one parent most of the time and spends the rest of the time with the other parent (a typical custody/access arrangement) the basic amount for child support to be paid by the other parent is determined by consulting a table published as part of the Child Support Guidelines. The number of children is matched with the income of the non-custodial parent (the income of the custodial parent is not counted). An amount may be added to this basic amount for the non-custodial parent’s contribution to “special and extraordinary expenses” such as child care expenses, and expenses for extracurricular activities and post-secondary education. Adjustments are made for shared parenting where the child is with each parent more than 40% of the time, and for cases of hardship where the standard of living in the payer parent's home would be less than the standard in the payee's home. A feature of child support payments that differentiate them from spousal support payments is that they are tax-free in the hands of the recipient. (In spousal support where the payments are made on a periodic basis—e.g., once a week or once a month—pursuant to a written separation agreement or a court order—the payments are included in the income of the recipient for tax purposes and deducted form the income of the payor.)
Married spouses (and, in certain circumstances, common-law spouses) have a duty to support each other. In determining the amount and duration of support the court applies a broad discretion within an area loosely defined by a number of criteria. This gives the law of spousal support a sometimes vexing degree of unpredictability. To address this problem Spousal Support Advisory Guideline have been designed as a “check,” or “litmus test,” or “tool,” to assist the court and the parties to arrive at proper spousal support terms. The “advisory” nature of these guidelines must be emphasized. They are not “presumptive” like the Child Support Guidelines, and, therefore, do not have the same authority or certainty of application. The law for determining spousal is shaped around certain factors and objectives set out in family legislation. The “factors” consist of the means, needs and other circumstances of each spouse, including (a) the length of time the spouses cohabited and (b) the functions performed by each spouse during cohabitation. The “objectives” of spousal support to be considered are those which
“(a) recognize any economic advantages or disadvantages to the spouses arising from the marriage or its breakdown;
“(b) apportion between the spouses and financial consequences arising from the care of any child of the marriage over and above any obligation for the support of any child of the marriage;
“(c) relieve any economic hardship of the spouses arising from the breakdown of the marriage; and
“(d) in so far as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.”
The effect of these factors and objectives is to create two elements as a basis for spousal support: (1) compensation and (2) need. The opposite side of the coin to these elements, and equally important, is the ability of the other spouse to pay support. Where property has been acquired during the marriage the compensatory element may be satisfied by the fruits of the property division. (See question on property division, below.) Assuming satisfaction of the compensatory element, whether or not one spouse is obligated to support the other depends largely on the applicant spouse showing a need for support on his or her part, and a corresponding ability on the part of the other spouse to pay support. In weighing needs, the applicant spouse must first look to his or her own resources. These include his or her own ability to earn an income from employment, and the investment potential of any payment received in the property division. Generally speaking, it is when these resources fail to make the applicant self-sufficient, that spousal support is payable. In this sense, spousal support is an income supplement to make up for a shortfall between the amount needed to maintain a reasonable standard of living, and the amount generated by the applicant's own resources. The income tax treatment of spousal support is an important consideration. The deduction/inclusion rule applies which allows amounts paid for spousal support to be deducted by the payer spouse from income for the purpose of calculating tax, and whether or not this deduction is made, the amount for spousal support must be included by the recipient spouse in income for tax purposes.
Married spouses (but not unmarried spouses or common law spouses), upon their separation, are entitled to a division of the property acquired by them during cohabitation under the marriage. However, it is not the property, itself, which is divided; it is the value of the property. The process involves an accounting of the value in a procedure that creates a debt owed by one spouse to the other, not a right to a physical partition and transfer of actual property. Subject to certain exclusionary rules, property of every kind acquired during the marriage comes into the accounting -- the value of land and buildings, bank accounts, pensions, accounts receivable, and everything else the value of which can be expressed in dollars. The property acquired during the marriage can be the increases (gains) in value of property that was owned at the time of the wedding, as well as the value of the several items of property purchased after the wedding. The values used in the division process are net of debts and liabilities; that is, the debts and liabilities are deducted from the positive value of the property. To calculate the payment owing by one spouse to the other, an accounting is made of the "net family property for each spouse". Generally speaking, net family property is a spouse's net worth (assets less liabilities) at time of separation less the spouse's net worth at the time of the wedding (except for a matrimonial home that is owned at the time of the wedding). In the ordinary case, the debt created or the payment that is owing is one-half the difference between the greater net family property and the lesser net family property. The spouse with the greater net family property owes this amount to the other spouse. Because this payment balances the values of the property holdings of the spouses, the payment is called an "equalization payment." Where an equalization payment would be "unconscionable" the division of the difference between the net family properties is adjusted to be more or less than one-half. An example of a calculation of an equalization payment is:
Value of property, date of separation $200,000 $350,000
Value of property, date of marriage 15,000 50,000
Net family property $185,000 $300,000
Difference between nfp's $115,000
($300,000 - $185,000 = $115,000)
One-half the difference is $57,500
($115,000 / 2 = $57,500)
Wife pays this amount to Husband 57,500 (57,500)
Value of holdings after equalization payment $242,500 $242,500
A will made during your marriage continues to be valid during the period of separation until revoked. The separation, by itself, does not revoke the will or affect its validity. On reviewing your will, you may find that its terms are no longer appropriate for the period you are separated. In this case, you should take steps to change it or make a new will. If you do not have a will and die during the period of your separation, your estate or a portion of it may be distributed to your spouse under the provisions of the Succession Law Reform Act.
If there are children of your relationship (natural or adopted) you have the same rights with respect to the children as a married person. Parenting rights (custody/access) and child support do not depend on a marriage. Spousal support is different. Spousal support in either an opposite or a same-sex union depends on whether you and your partner have lived together “(a) continuously for a period of not less than three years, or (b) in a relationship of some permanence, if [you and your partner] are the natural or adoptive parents of a child.” Rights to property division as described above, apply only to married spouses. Non-married spouses cannot claim an equalization payment. In certain circumstances, however, a non-married spouse has limited rights to property in the other partner’s name. These rights depend on showing that there was an agreement that the other partner would hold the property or part of it in trust for the partner claiming the right, or that the partner claiming the right had made direct or indirect contributions to the property in terms of money or money’s worth that “unjustly enriched” the other partner.