September 30, 2023

In a current landmark choice, the Supreme Court docket of Canada has supplied some necessary course on how courts ought to method casual separation agreements which are crafted by spouses with out the assistance of attorneys.

The choice known as Anderson v. Anderson, and includes a separated Saskatchewan couple who had been married solely three years and had no youngsters collectively.   

Within the firm of two pals from their church – who have been encouraging them to work issues out – the spouse introduced the husband with a selfmade separation settlement protecting the division of their property.  The draft settlement stipulated they might every preserve no matter property was already in their very own names, and would relinquish any claims to property held by the opposite, apart from their matrimonial house and shared family items. There have been no spousal assist points in any way.  

The husband and spouse each signed the settlement within the presence of their church pals.  Importantly, neither of them had obtained impartial authorized recommendation earlier than doing so, and neither went to the difficulty of creating full monetary disclosure to the opposite, as is often required in these circumstances.

Later, when the spouse requested for a divorce, the husband determined to contest the separation settlement’s validity.   He complained that he was underneath duress when he signed, and had not obtained impartial authorized recommendation upfront.

The dispute wound its method by the courts:  At trial, the settlement was declared non-binding and of no weight; on later enchantment, the court docket reversed. 

Earlier than a 7-judge panel of the Supreme Court docket of Canada, the separation settlement on this case was declared honest, equitable and binding.  It was not out of line with the goals of the provincial Household legislation regime that utilized to it.

Admittedly, the Supreme Court docket mentioned, the circumstances round its signing weren’t splendid.  Nevertheless no unfairness arose from them. The spouses had identified in regards to the state of one another’s funds after they married, so the technical lack of economic disclosure was not a priority.  Nor was there proof that both of them misunderstood the settlement’s authorized impact, or that one partner was making the most of the opposite.

From a broader perspective, the Supreme Court docket added that well-meaning, casual separation agreements like this one can nonetheless be given substantial weight by courts requested to resolve property-related points between {couples}.  It emphasised, nevertheless, that separation agreements coping with property (as was the case right here) are topic to barely completely different authorized requirements as in comparison with these coping with spousal assist agreements, for instance.  The latter includes longer-term ongoing obligations, and is completely different in character than an settlement protecting a one-time remaining division of marital property.

Whereas stressing that each home settlement ought to nonetheless try to stick to the formal necessities set by the governing provincial Household laws, the Supreme Court docket of Canada supplied up the next refinements:

  • Home contracts ought to typically be inspired and supported by courts, throughout the bounds permitted by the legislature.
  • Even when a pair’s settlement is in imperfect kind, a court docket can nonetheless think about and provides it substantial weight, except there’s a compelling cause to low cost it altogether. 
  • Ideally, to make sure equity there must be safeguards in place, similar to every partner giving full and frank disclosure to the opposite, and every of them receiving impartial authorized recommendation.  However not having these in place just isn’t all the time deadly to the settlement’s validity.
  • Courts should additionally take note the emotionally nerve-racking context by which such agreements are cobbled collectively. The spouses are often underneath acute emotional stress, and one among them is likely to be susceptible or prone to being taken benefit of.
  • Courts should in the end method such selfmade agreements with a view in the direction of balancing the values of contractual autonomy and certainty, in opposition to considerations over equity. 

This is smart, the Court docket added, as a result of sarcastically one of many goals of the justice system is to encourage {couples} to keep away from having to go to court docket.  Canadian Household courts ought to accordingly encourage these {couples} who can resolve their points by self-directed means, similar to a separation settlement or mediation.  

The Court docket summed up its conclusions this manner:

 In sum, our jurisprudence on home contracts … values the ideas of autonomy and certainty by encouraging events to rearrange their intimate affairs outdoors the court docket system. However the emotional complexities of household dynamics make contracting over home affairs in contrast to common arm’s size transactions. The distinctive context out of which these agreements come up requires courts to method them with eager consciousness of their potential frailties to make sure equity, having regard for the integrity of the bargaining course of and the substance of the settlement.

Whereas the Supreme Court docket of Canada is actually not encouraging separating {couples} to desert getting authorized recommendation and illustration solely, the Anderson case provides some excellent news for conditions the place there are minor technical flaws in what’s in any other case a good settlement negotiated in good religion by prepared ex-partners.

Full textual content of the choice: Anderson v. Anderson, 2023 SCC 13