In family law you may be looking to complete one of the following: a pre-nuptial agreement, a post-nuptial agreement, a cohabitation agreement, a separation agreement, a divorce and property agreement or minutes of settlement. Any one of these agreements involves the inclusions of financial disclosure so that when parties are entering into a family law agreement, they are entering into the agreement knowing each others’ financial circumstances.
Why is this important?
The Supreme Court of Canada has provided clear and instructive decisions such as Rick v. Brandsema, 2009 SCC 10, that there can be a revision / altering of division of property between parties when it has come to light that there has been misleading financial information provided by one party, and this misleading information formed the basis of the parties’ Separation Agreement and division of assets.
In the case of Rick v. Brandsema, the lack of full and honest disclosure, as well as the presence of further vulnerabilities in the mental state of the wife, confirmed the finding of unconscionability in the parties Separation Agreement as confirmed by Honourable Justice Abella, speaking for the majority of the court in her written decision.
This is because the legitimacy of the private contract is challenged, and with this the foundational principles of parties’ entering into said contract. In light of a failure to provide full and honest disclosure in Rick v. Brandsema, the equitable remedy was in turn a revision of the agreed upon Separation Agreement property division, with equitable compensation in the favour of the wife, Nancy Rick.
Even when parties’ have reached settlement with the assistance of counsel, and through alternative dispute resolution, such as mediation or mediation-arbitration, these terms can be overturned. In the case of Rick v. Brandsema, the parties had reached terms while attending mediation, and they had their respective legal counsel review the terms of the Separation Agreement, and each counsel had confirmed providing independent legal advice with the signing of the parties’ Separation Agreement. While independent legal advice provides robust support towards a court’s position to not interfere with private contracts between parties, the case of Rick v. Brandsema provides clear instruction that the court will intervene if there is a clear failure of one party to disclose their financial assets.
The most succinct form of compiling financial disclosure comes in the form of the parties’ exchange of a sworn/affirmed Statutory Declaration of Income, Assets and Debts. It is here that parties include reference to all accounts that they hold, either solely or jointly (with their partner/spouse or any 3rd party). It is standard practice to include for each party a sworn/affirmed Statutory Declaration of Income, Assets and Debts as a schedule to a family law agreement (a pre-nuptial agreement, a post-nuptial agreement, a cohabitation agreement, a separation agreement, a divorce and property agreement or minutes of settlement).
As such, the terms of the family law agreement are then framed by each parties’ clear understanding of the financial information that has formed the basis for their decision to enter this Agreement.
At Family Central Law Office LLP, you can rely on experienced family lawyers to provide sound legal advice on your family law matters. Please contact us today for a free consultation with our family lawyers by calling our office at 587-392-7970 or emailing firstname.lastname@example.org, or by clicking on our consultation page.