Who keeps the family pie?

Jill is hosting a girls’ night out at her house.  She starts talking about her divorce with Jack and explains that she’s entitled to “half of everything”. Her friend Sandy who also went through a divorce 5 years ago tells her that that’s not how it works.  “You divide the value, not the assets”, she says.  A discussion on the subject enfolds and Debra, who has lived in a common law relationship with Dave for 5 years wonders if she would be entitled to claim half of everything as well as a common law spouse. Kathy thinks so, since her cousin got half of her ex’ house after a lengthy court battle, but Carolyn is convinced that this is not the case. And everyone is confused.

 

The rules applicable to the division of family property differ significantly depending on your legal status (married or living in a common law relationship), and also on the province in which you live. In fact, each of the Canadian provinces has its own way of dividing family assets when a separation occurs, whether married of in a common law relationship.

 

For married spouses, there are many general principles that apply in all provinces. The most important one is that all provincial laws share a common goal: to divide equally – or at least fairly – between the two ex-spouses the wealth accumulated by the couple during the marriage.  The basic principle underlying the various provincial family property division schemes is that marriage is a financial partnership and it does not matter who paid for the assets, whether a spouse has contributed more than the other, or who is the actual legal owner of any given asset.  In Ontario, the value of all assets acquired by the spouses (jointly or individually) during the marriage will have to be shared between them. In other provinces, the assets themselves get divided. In some provinces, like British Columbia, the court has the discretion to divide a married couple’s family property the way it feels fair and equitable. In most provinces, however, the judge has no discretion and must abide by very strict rules to which there are many exceptions.

 

For common law spouses, the right to share in the other’s property – and the way property is to be shared – when a separation occurs varies from province to province. For instance, in Manitoba and Nova Scotia, common law spouses are given substantial rights to share in the other’s property after separation.  But in other provinces, like in the province of Quebec, common law spouses have absolutely no right at all to claim a fair share of the property acquired by the other spouse during the relationship.  In Quebec, what is yours is yours and what is mine is mine, so to speak.  In other provinces, such as the province of Ontario, common law spouses are presumed to have no right to share in the other’s property, but if very specific circumstances exist, courts will allow common law spouses to share in some or all of their spouse’s assets upon separation.  It is a myth to believe that you are entitled to half of your ex’s assets if you have lived in a common law relationship for more than three years!  When the parties cannot agree (as is often the case) on how to divide their assets, they will have to bring the matter to court and let a judge decide. This process is, as you know, very costly and (so far as common law spouses are concerned) very unpredictable.

 

Because the laws of each province are so drastically different when it comes to splitting this cherished family pie, it is extremely important to understand the regime that applies to your particular situation, in your particular province. Take the time to inform yourself and obtain proper legal advice BEFORE you move in with someone, get married, make a significant financial contribution or investment in joint assets or in assets belonging to your spouse.  Entering into a well written cohabitation agreement (common law spouses) or a marriage contract (marriage spouses) could avoid many heartaches and headaches.  Why wait until a separation occurs to find out that after all these years of emotional and financial investments, you are not even allowed to eat a piece of the pie…

Life insurance to secure child support: There’s no way I’m leaving you this money!

Since the separation, Jack has never stopped paying the monthly premiums for the life insurance policy that he and Jill bought during their marriage.  As there is no chance of reconciliation, Jack wonders whether he should stop paying for Jill’s portion of the monthly premiums.  After all, why isn’t Jill paying for her own premiums? Jack’s friend Dave also told him that he should immediately remove Jill’s name as the beneficiary of his insurance policy and put the children instead.

 

If Jack was well advised, he would do neither.  When parents separate and there are dependent children to care for, it is very important for both parents to maintain life insurance coverage sufficient to provide for the children should the unthinkable happen.  As long as the children remain dependant financially, both parents have a continued obligation to provide financial support –child support – whether they are paying it or receiving it.

In most cases, when a parent dies, the children move in full-time with the surviving parent who is left with having to financially support the children, without any financial contribution from the other parent, unless proper life insurance coverage is in place.  Even if the deceased parent has made a Will and named the minor children as beneficiaries of part or all of his or her estate, the reality is that it often takes months, if not years, for an estate to be administered and the gifts to be distributed.  Furthermore, the Will may prevent the children to have access to the money until they are 18 years of age or even older.  In the meanwhile, the surviving parent struggles and the children suffer unnecessarily. 

 

Here are some additional reasons why separated parents should maintain life insurance coverage naming the other parent as irrevocable beneficiary in trust for the children AT ALL TIMES:

1. If you die and have made no provisions for the other parent to receive money for the support of your children, the surviving parent may very well sue your Estate to obtain that support.  This is bound to delay the administration of your estate considerably, in addition to forcing your executors to engage significant legal fees to defend the action and settle the issue, leaving less money for the children in the end.

 

2. If your child is a minor at the time of your death, he or she will not be entitled to receive any monies directly (from your Will or your insurance policy).  The monies will have to be administered by the person you named as trustee for your children.   If no one was named, the monies will be administered by the Office of the Public Guardian (OPG), a governmental institution who will step in to administer your financial affairs and decide what is best for your children.

 

3. Having your ex-spouse as beneficiary in trust of the life insurance proceeds for your children with specific directions as to how the funds may be used by him or her, and what is to be done with any leftover once the children cease to be dependent, will insure that the monies are used properly for the benefit of your children.

 

4. Your children will have immediate access to funds to maintain their standard of living after you are gone.  They will be able to pursue their activities or schooling, and there will be no gap between the time of your death and the time they have access to the fund they need to pursue their daily life.

 

5. Proper life insurance simplifies the lives of everyone involved if one of the parents dies, and the cost to maintain relatively large amounts of temporary life insurance coverage is quite minimal - depending of course on your age and health condition. 

Making sure your children are provided for in the event of your death is a part of being a responsible and loving parent.

Watch What You Write on Your Wall…

Jill is very upset with Jack and vented her frustrations on Facebook.  Her friends “liked” her comments.  Unfortunately, Jill forgot that one of her friends is also friends with Jack’s teenage niece who has her phone glued to her hip and who instantaneously saw the comment Jill made about her uncle.  Of course, she immediately shared it with her mother, Jack’s sister.  Even if Jill wanted to erase her comment, it is too late and Jack has already seen it. 

Social networking services such as Facebook, Linkedin or Twitter have not only become a “marriage killer” – you would be surprise to learn how many people discovered that their spouse was cheating through these means -  they also have the potential of becoming a “best case” killer in court or in a divorce settlement process.  When a separation gets ugly, spouses may be tempted to use social media as a channel to vent their anger, bash their ex-spouse’s actions and get support from common friends and family members in what they believe to be their “just cause”.   

 
If you are using social media to show off your new “hot” girlfriend to your buddies, or to gain support from your friends, rest assured that this evidence is going to find its way into the court room – or in your ex-spouse’s lawyer’s hands–quicker than you can think.  Yes, this type of evidence can be used against you in court and in other settlement processes.  Imagine, with your own actions and your own words you may give your ex-spouse the evidence he or she needs to discredit you and prove his or her point against you.  Your children could find your disparaging comments in future years.    It is hard for parents to argue that they have their children’s best interest at heart – and thus should be granted sole custody of them – when evidence proves that they have spent the past two months destroying the other parents’ reputation in social media.   Even worst, your children can be scared emotionally in the process, especially if your comments are available for the whole world to read. 

Finally, it is not enough to try to limit the damage by shutting down your existing account, locking down your privacy settings or “untagging” your images and pictures.  The damage may be impossible to control down the road as social media tends to leave permanent traces.  Remember that social networking services were created to help people stay in touch. Therefore, if one day you have the urge or the need to vent about your ex or the events related to your separation, just pick up the phone and talk to someone before writing it - permanently - on  your wall. 

Should we involve the Office of the Children’s Lawyer in our parenting dispute?

Jack thinks that Jill is unreasonable when making plans regarding the children.  She refuses to be flexible when it comes to dividing the time with the children on holidays, sharing information from the school, or letting him take the children for more than a few days here and there. Jack wants to have the children with him half the time to regain his place as a parent in their lives.  His friend has suggested that he should consider getting the Office of the Children’s Lawyer (OCL) involved but Jack is leery to engage the children in a process that he does not understand. 

The Office of the Children’s Lawyer is a government-funded organization that oversees that justice is being served on behalf of children (under 18 years of age) through the delivery of various services in the province of Ontario.  It is important to note, however, that the OCL’s involvement in custody and access cases is not automatic.  Their services may be requested by a judge in the context of a court case but there is no guarantee that the OCL will provide services.  If it does, then those services will be provided free of charge to the parents.  In essence, the OCL steps in as an objective third party to introduce some impartiality in disputes between parents.  The OCL can provide two very useful services: independent legal representation for children and custody and access assessments performed by trained social science professionals.

Independent legal representation will normally be provided when the child is older or at least sufficiently mature to express his opinion about his preferences. The child’s lawyer will be an advocate for the child and his/her role and responsibility will be to convey to the judge the child’s wishes and preferences with regards to the visitation arrangements that he would prefer.  For younger children or for families that present important challenges (such as allegations of domestic violence, substance abuse, parental alienation or where a child has special needs), the OCL may become involved by carrying out a comprehensive family assessment.  Following such an assessment, the OCL’s clinical investigators will report to the court to provide recommendations about the custody and access arrangements that would be best for the children.

The OCL’s services are very effective at helping parents make decisions that are in the best interest of their children, when they have not been able to do so on their own. Of course, it is always best for everybody when parents are able to agree between themselves as to what is best for their kids, as parents may not be happy with the recommendations made by an outsider, be it a judge or the professionals working for the OCL.

Who keeps the paws? Do I need to share the dog too?

Jack and Jill had a fight over their family golden retriever, Honey Bun.  Jill refuses to allow Jack to take the dog with him in his new apartment.  Honey Bun is Jack's dog.  He was the one who decided to buy it, against Jill's wish, but now she refuses to let Honey Bun go live with Jack.  Jill claims that Honey Bun truly belongs to the children who are very attached to their family pet and as a result, the dog should remain with them in the family home. 
 

Couples who go through separation and divorce can spend a lot of time fighting over how they will divide their personal property like the home, the pension plan and the furniture.  Often, bitter disputes arise about who will get to keep the family pet.  The family dog or cat is as much a member of the family as anyone else and it can be very difficult to part with them. 

When deciding who should get “custody” of the family pet, people focus on their own personal wants and desires and on what they feel would be best for the pet (or for themselves).  Sometimes one spouse uses the pet to try to exert control over the other spouse – and sometimes it works... When there are kids involved, the family pet often becomes a football as the parents figure that where it lands will be where the children will want to land as well.

But here is one thing you might not know:  in the family law landscape, a pet is considered a piece of property (it seems cruel doesn’t it?) and if the issue of who gets Honey Bun is ever decided by a judge, the person who holds legal title to the dog (i.e. the person who can show proof of payment) will be entitled to walk with it.  Keeping this in mind, a pet IS nonetheless a living being (unlike the chair and the RRSPs) and when deciding who should keep it, you should consider the following:

• Who originally purchased the pet?
• What was the intention of the family at the time of purchase?  That the pet be the kids’ friend?
• Who will have primary care of the children? Keeping the pet with the kids can be very important during a divorce because it provides some stability and comfort.  Maybe the pet should travel for a while?
• Who took care of the pet while you were together? Often, parents buy the pet for the children but mom or dad ends up taking care of it full time as the children loose interest in it. Who has become the dog’s Master?
• Will a change in environment result in a change in the pet’s behaviour, including unwanted ones?
• Who has the financial means to keep the pet, i.e., to pay for the food, care and vet bill (if you don’t have a pet, do know that they can become quite expensive to maintain).  Unlike child and spousal support, you cannot get “pet support”!

As with anything else, if you go to court the decision will be made according to the law (i.e. the dog follows its legal owner), but if you settle the issue outside of court, you can be as creative as you want and use a common sense approach when it is time to decide who keeps the paws.

Get a job! The truth about spousal support

Over the summer months, Jack and Jill had lengthy discussions and arguments about how they will move forward with their separation.  For the time being, Jack has agreed to let Jill live in the family home and he has rented a nice three bedroom apartment for him and the children.  This  decision will allow Jill to put some distance between them and will help reduce the conflict to which the children have been exposed to these last few months. Jack and Jill have also had several heated discussions about child and spousal support.  Jill still works part-time and she needs additional financial support, beyond the child support she is currently receiving, to pay for household expenses while the parties continue negotiating their separation. Jack feels that Jill should finally get a full-time job and pay for her own bills. 

There are a lot of misconceptions surrounding spousal support.  “Women don’t have to pay spousal support”  “I don’t have to pay spousal support if I am not married” “Spousal support is forever”… and many more.  Spousal support is a very complex topic (even for lawyers…) and to explain it properly would take many more pages than what is available for this article.  But here are a few important things to know about spousal support.

 

• Both married spouses and common law spouses may have to pay spousal support;

• Both men and women may be ordered to pay spousal support;

• Spousal support is an amount of money that one spouse pays to the other on a monthly basis, or as a one-time lump sum payment, to achieve one or more of the following objectives:

• Recognize that one spouse has suffered an economic advantage or disadvantage and compensate that spouse for that;
• Attribute fairly between the two spouses the financial consequences that one suffers as a result of caring for the children (either during the relationship or after its breakdown);
• Help a spouse who has a financial need after the separation;
• Help a spouse to achieve financial self-sufficiency.

• When determining the amount ($$) and the duration (# of years), if any, that a spouse is entitled to receive spousal support for, the following factors will be taken into account (this is not an exhaustive list);

• The number of years during which the parties have lived together;
• The parties’ respective income;
• whether the couple still have dependent children;
• the parties' age as well as their physical and mental health;
• the parties’ standard of living during the relationship;
• the parties’ current assets and financial means, including what they are likely to get in the future;
• the capacity of the recipient to contribute to his/her own support, by working or otherwise, and the amount of time it will take him/her to achieve self-sufficiency;
• the payer’s capacity to pay support;
• whether or not the recipient has helped the other spouse to build a career or a business.

It is also important to note that the fact that a spouse has cheated on the other has no impact on how much spousal support is payable, or how long.  Also keep in mind that spousal support is tax-deductible in the payer’s hands and taxable income in the recipient’s hands.

As I said previously, spousal support is complicated and there is no hard and fast rule that governs its determination. And in addition, support entitlement and/or obligations, in certain cases, can last a very long time and you want to make sure you are paying/receiving the proper amount. So before you agree on anything about spousal support, you should meet with an experienced family lawyer (even if only for an hour) to obtain proper legal advice on this topic.

Becoming a single parent doesn’t come with a manual!

Jack is doing very well as a single dad.  He is proud of his children who seem to be coping fairly well with the separation, with the exception of a few crying spells at night as they miss their mother’s kisses before going to bed.   Jack is worried, however, of the long-term effects of the separation on the children.  Research studies demonstrate that, although a separation can be tough on kids, particularly in the first few months following the break-up, what is really damaging to a child’s health, development and overall well-being is parental conflict.    Children are like sponges and they know and sense when something is wrong, no matter their age.   Babies cry when they feel tension between the parents, while teenagers will slam the doors to be heard.   Being a child of separation himself, Jack knows that what children want most is to be loved by both of their parents.  Since becoming a single parent did not come with a manual, Jack has read a few books where many professionals have provided advice on how to help children cope with separation and divorce and adapt positively to their new lives. 

Here are a few useful tips that guide Jack in his everyday life as a single dad:

1. Tell your children the truth in simple terms with simple explanations. Tell them where the other parent has gone, how the summer and Christmas holidays will be organised etc.  (It’s all in the delivery of the message.  Choose your words and tone of voice).

2. Tell your children that they will continue to be taken care of and that they will still be safe and secure.  (Even after the separation, children need to be constantly reassured).

3. Children see that parents can stop loving each other.  Reassure them that a parent's love for a child is a special kind that never stops. (Saying I love you is more important than ever).  

4. Children feel responsible for causing the divorce. Reassure them that they are not to blame.   (Showing love and understanding is more important than ever).  

5. Children often hope for years for their parents to get back together and feel responsible for bringing them back together. It is important to let them know, gently but firmly, that the breakup is final.  (It may not be easy to say especially if you are still in denial yourself.  However, giving false hope of reconciliation is not healthy for anyone involved).   

6. Avoid situations where the children must choose between parents such as:

• Using the children as a way to get back at your spouse. (Children can feel that they are being used and can be terribly wounded).

• Saying bad things about the other parent in front of the children.  (It is not always easy to remain the bigger person when you are hurting however, no one can take away your dignity).

• Saying things that might discourage the child from spending time with the other parent. (What goes around comes around).

• Encouraging the children to take sides. (All they want is to be loved equally).

7. Even though it may be the last thing you feel like doing, cooperating with your spouse during your divorce is one of the best gifts you can give your children (Cooperating responsibly with the other parent toward the growth and development of your children is an expression of your mutual love for them.)

Parenting is forever and being a single parent can be very hard at times.  When you don’t know what to do anymore because nothing seems to work anyway, just remember that the best tools you possess and to which all children react positively to are LOVE, PATIENCE and UNDERSTANDING.  

It’s his fault! He should pay more! (No-Fault Divorce)

Jill suspects Jack has a new girlfriend, possibly pre-dating the separation.  Jill wants to obtain a divorce and she is wondering what gains she can make as a result of Jack’s indiscretion…

In Canada, we have since 1986 what we call a “no-fault” divorce regime.  This means two things.  Firstly, you can ask for a divorce without having to demonstrate misconduct by either spouse, so long as you can show that you have been separated for at least one year.  It is the most common method of obtaining a divorce in Canada.  Divorce is an emotionally and financially taxing process and fault-based grounds of divorce (adultery, cruelty) require proof, which may intensify an already painful and expensive process.  Additionally, the law recognizes that family relationships are complex and matrimonial misconduct is not always the cause of the breakdown of a marriage.

Secondly, “no-fault” divorce means that your rights and obligations following a separation will be the same regardless of “whose fault” the separation is.  In other words, whether you separated amicably by mutual consent or whether you separated as a result of your partner’s adultery or other type of marital “misconduct”, the financial end result (division of property and financial support) will be the same.  Proving adultery, for instance, will not get you a bigger financial settlement.

So is there any benefit to proving cruelty or adultery within a marriage?  Beyond granting a divorce, the court will seldom (if ever) consider adultery or cruelty when making decisions regarding financial issues.  However, the courts may consider these as factors surrounding matters relating to children, if they influence the spouse’s ability to parent.  For instance, if a spouse has anger management issues resulting in domestic violence, this will obviously affect his ability to parent his children. However, it will not result in a higher spousal support (alimony) award. There is also a possibility of claiming damages as a result of an assault, but this requires a clear demonstration of injury and its

consequences. 

By choosing a no-fault basis for divorce (even if you feel that there has been some marital misconduct by your ex-spouse) you will alleviate some of the major stress of the process with regards to time, financial burden and emotional turmoil.  You may also be able to move on from the relationship without drawing out the process, particularly since there is no real advantage to be gained from the fault-based process.

Domestic Violence Court Program

Jack just received a disturbing telephone call from his sister Anna late last night.  During an argument between Anna and her husband, violence erupted and a call to 911 was made by the oldest daughter.  Since a mandatory charging policy has been implemented in Ontario to improve the system’s response to domestic violence, if there are reasonable grounds, the police must lay charges.  In light of the circumstances, the police officer also made a dual arrest as he had reasonable grounds to charge both the offender and the victim.  Both parties must now appear in court and Jack wants to be present for his sister. 

Domestic violence, also referred to as intimate partner abuse, is a crime in Canada.  Though primarily perpetrated by men against women, it can also be carried out by women against men or even in same-sex relationships.  Domestic violence takes on many forms not limited to physical violence, and the complexities of these relationships may result in victims repeatedly exposing themselves to potential violence. 

In Ontario, the Domestic Violence Court  (DVC) Program accounts for the unique relationship between offender and victim as well as other individuals affected by the violence, such as children.  The DVC deals with domestic violence cases in several ways, including, intervening early on in abusive situations, providing assistance to victims, and holding offenders accountable for their actions. 

The casualties of domestic violence are not limited to those directly involved, thus consideration is given to the safety of other family members such as children as well.  There are several components and specialized personnel that assist the operation of this program, including: police, Crown Attorneys, the Partner Assault Response (PAR) program, the Victim/Witness Assistance Program (VWAP) and other community agencies.  

The PAR program instructs and provides guidance to offenders ordered to follow the program by the court.  Its purpose is to hold offenders accountable for their abusive actions and to increase the safety of victims.  Offenders obtain the tools necessary to analyze their behaviour and to resolve conflict in a non-violent way.

The VWAP program is set-up to assist victims and witnesses of crimes by facilitating their understanding of the criminal court process and providing support as they participate in the process.  This service is not limited to domestic violence cases, as it also assists victims/witnesses of child abuse, sexual assault and homicide.  This program is meant to serve the vulnerable individuals involved in such crimes.  The services are provided from the time charges are laid to completion of the case.  Assistance offered includes: emotional support, court preparation and case information, as well as referrals to other organizations that provide support

It’s summer and kids just want to have fun!

While sipping her coffee this morning, Jill was thinking of her childhood and remembered the times when she slept ‘till noon, spent hours in front of the TV in her PJ’s and played outside all day with her siblings and friends.  Jill feels that since she and Jack separated, with the kids having to deal with two homes and the ever changing parenting schedule, they just don’t have time to “chill” anymore – as they say.  The summer vacation plans have become soooo complicated since both parents want to enjoy quality vacation time with the children.  Jill understands the need for her to recharge her batteries as well, as the school year was quite hectic with the many changes and challenges brought about by the separation and trying to keep up with the homework and extracurricular activities’ schedule.

If that sounds like your current life circumstances, here are a few tips that you might want to keep in mind when preparing summer plans for you and your kids. 

The golden rule:  KEEP IT SIMPLE and FUN! 

1. Stop pressuring yourself to create the perfect summer for your children. You're not a cruise director; you're a parent.  Ask the children to help you plan the activities. You’ll see, they have the most amazing (and simple) ideas. Remember, there is a lot to be said about quiet dinners on the patio, picnics in the backyard and ice cream cones on a hot night.  Running through the cold water sprinkler can easily replace the public pool.

2. Try to work, clean your house, or do volunteer work while your children are with the other parent.  Save the fun events for the days your children are with you. If your schedule conflicts with your ex’s, try to compromise keeping in mind that the end goal is to give your children a relaxing and fun summer.   Although it may not be easy to deal with an ex that keeps messing up your plans, patience and flexibility always make things easier in the end.

3. Friends are extremely important for children, particularly older ones, and your super-organized schedule may not fit their plans for simple play time in the backyard or at the park. If required, go the extra step and offer to drive your kids’ friends to and from your home.  Serving a glass of iced juice with homemade chocolate cookies on the picnic table can win you the award of the “coolest” neighbourhood parent.

4. Let’s face it, often you can’t spend the whole day playing with your kids. Don’t feel guilty. Just look with your children for alternatives that will keep them happy while you are busy doing other things. Again, involving your children in planning their activities gives them a sense of control over their schedule which is often taken away as a result of sharing two homes.

5. Last but not least, plan for some adult fun for the days the children are away. You also need time to enjoy your summer vacation and to regain your energy.  Take time to explore new places or simply invite family and friends and just relax and laugh in the backyard.  Remember the golden rule:  KEEP IT SIMPLE and FUN!

“I am not the bank!” - Children’s special and extraordinary expenses

Jack sometimes feels like he is considered a banker as the kids always need something new and Jill keeps on asking for money.   Now, it is braces and bikes.  Jack considers that the monthly child support he gives Jill should be enough for her to cover all those expenses.  Now that they are separated, he also has his own housing expenses to pay and there’s no way he is going to go into debt because Jill is unable to properly manage her money.   Jack strongly feels that it is time for Jill to learn how to live within her means.  After all, he is not a bank. 

Often, custodial parents are blamed by the ex for spending too much money on the children.  Under Canadian Federal and Provincial laws, children are entitled to financial support from both parents even if they are separated or divorced.  After all, it does take money to raise children and the expenses just get bigger as the kids get older. 

In Canada, child support is made of two components:  the basic table amount (meant to cover all basic needs) and the contribution to “special expenses” (meant to cover specifically defined types of expenses).  The basic amount is determined using the payor’s gross annual income in accordance with the Federal Child Support Guidelines.  Click on this link to access the federal child support calculator:  http://www.familylawinabox.com/en/resources_child_support.php 

Most disagreements in the area of child support arise with regards to special expenses, to which both parents must contribute in proportion to their respective income.  For example, if mom earns $25,000 per year and dad earns $75,000 per year, mom would have to contribute 25% towards the cost of special expenses and dad would have to contribute 75%.

As set out in section 7 of the Guidelines there are six specific categories of special expenses:

1. Child care (i.e. daycare)

2. The portion of medical and dental insurance premiums paid by either parents to cover the children (that portion that is paid by the employee)

3. Health-related expenses exceeding $100 a year (i.e. orthodontics, counselling, prescription drugs)

4. Extracurricular activities (i.e. horseback riding, hockey, music)

5. Primary or secondary education programs (for example, tutoring or the cost of a special software for a child with disability)

6. Post-secondary education costs

As usual, family law is not as simple as 1-2-3 and special rules apply to special expenses.   Even if an expense fits in one of the categories described above it does not mean that the parents must necessarily contribute to it. The expense has to be necessary for the child, and reasonable in light of the parent’s financial means.  Extracurricular activities or primary and secondary educational costs also need to be “extraordinary”.  Confused yet?  To help you understand your rights and obligations we have created a program entitled: « What is a special or extraordinary expense?”  which you may access by clicking here for more information.

While this is not specified in the Guidelines, the best practice for parents is to consult one another BEFORE an expense is incurred for the children, unless the expense is absolutely necessary (like child care or medical expenses).  Judges frown at parents who spend money on special expenses without requesting the other parent’s permission and then try to collect.  If you do that, a judge may deny you the reimbursement. 

How to choose a family lawyer?

It has now been three months, and conflict between Jack and Jill is reaching an alarming level.  Until recently, Jill believed that she would be able to resolve family issues with Jack amicably without the need for lawyers to get involved. This no longer looks like a possible outcome.  As a result, Jill is looking for a family lawyer.

How does one choose a family lawyer?  Hiring the right professional is certainly one of the most important decisions you will have to make in the context of your separation.  The choice of lawyer you make may have a significant impact on your financial future, the length that it will take to resolve things, and the amount of legal fees you will have to pay.  Most importantly, your children’s well-being and your ability to co-parent cooperatively with your ex in the future may forever be affected by choosing the wrong lawyer.

To choose the family lawyer who will be the perfect fit for you and your particular situation, take into consideration the following:

- Do you want a fight or do you want to remain civil and amicable?  If you want to do this as peacefully as possible, look for a lawyer who has a mediation or collaborative law training.  If you want a hired gun who will defend you fearlessly against an abusive and/or vindictive ex-partner, seek someone with a lot of court experience.

- Do you need an expert in family law or someone who has great negotiation skills?  While the expert may be better if your case presents some complex legal issues (often when the couple has accumulated significant wealth), if the main issue of contention is the care of your children you may be better served by someone with great negotiation skills rather than lots of academic knowledge;

- What is your budget? If you have limited means, you may want to look for a sole practitioner as opposed to hiring a lawyer who is part of a big law firm.  Sole practitioners or lawyers in smaller practice can usually offer more flexibility than large firms in terms of payment plans and hourly rates.

No matter what type of lawyer you need, in all cases you want to make sure that the lawyer who will help you with your case will have the following essential attributes:

- He/she practices exclusively in (or at least the larger part of his/her practice is dedicated to) the field of family law.  While your best friend, who happens to be a real estate lawyer, may be willing to help you (even for free), he/she does not have the necessary skills;

- He/she is available and responsive.  A two-day delay for a return call from your family lawyer is just not acceptable in the highly emotional field of family law which often presents emergencies;

- He/she is compatible with you.  You and your lawyer need to be on the same page when it comes to making decisions in your case.  As you will need to work closely together, you don’t want to work with someone who makes you feel unworthy or with whom you do not feel comfortable.

- He/she must treat you as an equal and essential part of the team.  You want a lawyer who listens to you, who seeks and considers your views, who keeps you informed of every event and development in your case, and who works collaboratively with you towards a final resolution.  You are not hiring a lawyer to make decisions for you.

- He/she must be a teacher, a coach and be candid and honest in the opinions he/she gives you. Way too many lawyers see their role as either your decision maker or your cheerleader.  You want neither.  You want someone who explains to you in clear language how the law works, who tells you when you are unreasonable or when your position is weak, and who leaves it to you to make your own decisions based on the information you have been provided.

In case of doubt, seek references from your friends, colleagues and family members who have been through a separation before. They most likely had to work with family lawyers and are a great resource when it comes to making that very important decision.

It only takes a minute to make a phone call!

It is 6:03 p.m. and Jill is home waiting impatiently for the children to return from their visit with Jack.  It is now seven o’clock and the children are still not home.  Jill is really worried that they had a car accident and tries to call Jack on his cell phone but, as usual, she gets the voicemail.  It is 7:52 and Jill is close to tears when finally the car pulls into the laneway.  The children are happy to see their mother, Jack acts like nothing happened and wonders why Jill looks so weird and upset. 

If this scenario sounds familiar, just know that you are not alone. Agreements around children’s exchanges are sometimes not followed and can be a perfect opportunity for an irritated parent to upset the other as a result of thoughtlessness, immaturity, or simple lack of respect.  Unfortunately, there is often no legal sanction for this type of behavior.  Disputes arising from the implementation of the parenting provisions of a court order (such as exchange times) are civil matters, not criminal ones.  The police usually does not get involved unless there is a risk of harm to one parent or the children.

How can you manage your children’s exchanges effectively?  Obtaining a solid parenting agreement containing detailed expectations and built-in sanctions for misbehavior may be the answer to your problems. Your agreement should allow for a reasonable exchange time window as it happens to everyone to be “reasonably” late because of traffic, work or some other unavoidable delay.   However, if the parent does not call to notify the other parent or simply does not show for the visit, then the agreement should provide that the parenting time is lost so as to allow the other parent to carry on with his/her day. The same sanction could apply to future parenting time if the children are not returned on time after a visit. You may also want to consider asking for the exchange to take place in a public location such as a restaurant or coffee shop.

Is it possible to change your current, ineffective child custody order or parenting agreement? Yes, but you will need to go to court and ask a judge to vary the terms of your agreement or order. Depending on your current situation, this costly process might be worth your while in the long run and may be in the best interest of the children who are often caught in the middle of these high conflict situations.  Be sure to journal all the exchanges – the good and the bad – as you may need to provide the court with detailed accounts of the exchanges.

Parents and children both deserve a life post-divorce that is devoid of chaos and stress. This is easily achieved when both parents maintain a mutually respectful co-parenting relationship. Remember that good accounts make good friends and it only takes a minute to call and inform the other parent that you will be late. 

Tax Headaches for Separated Couples…

Here comes tax season again, and it’s time for Jack and Jill to pay the price for being respectful and abiding Canadian citizens.  It is hard enough to disentangle income tax issues when the family unit is still whole, imagine the complications that can arise when you have just separated and you do not have a finalized separation agreement. Canada Child Tax Credits, Harmonized Sales Tax Credits, Universal Child Care Benefits, Dependants Claims and National Child Benefits are only a few of those complex issues that need to be dealt with and Jack feels overwhelmed.  To make things worst, his lack of “meaningful” communication with Jill at this stage of their separation process is actually making income tax filing a true headache.   

If you were represented by a family lawyer when you signed your final separation agreement, you should not have to worry about future tax implications as your counsel should have carefully assessed them and included specific provisions in the agreement to help you determine which tax credits and benefits each of you is entitled to claim. However if, like Jack, you do not have such an agreement, here are a few tax principles that you absolutely need to be aware of:

 

 

1-     Child support payments. These payments are not tax-deductible for the support payor and are not included in the recipient’s income for tax purposes.  Support Payors Beware: You cannot claim an income tax deduction for the child support payments you made this past year.

  

2-    Spousal support payments. These payments, however, are included in the income of the support recipient and are deductible from the support payor’s income (unless the support was paid in one lump sum in which case different rules apply).  However, to be deductible the obligation to pay spousal support must be confirmed in a written separation agreement or a court order.  While Revenue Canada will recognize support payments made in the year preceding the execution of a separation agreement in most circumstances, you do not want to take a chance and you should confirm any spousal support obligations in a binding agreement (even partial, even signed at the kitchen table) without delay. Spousal Support Recipients Beware: You may need to pay income tax on the money you have received from your ex this past year, so make sure you put some money aside.  For more information on this topic you can visit the following Canada Revenue Agency link:

     

      http://www.cra-arc.gc.ca/tx/ndvdls/tpcs/ncm-tx/spprtpymnts/menu-eng.html.

3-    Shared custody arrangement. A shared custody arrangement (for tax purposes) means that each parent spends an equal amount of time (or a near-equal amount of time) with the children in any given year.  In that case, the rules can get real complicated.  You can obtain more information by visiting the following link on Canada Revenue Agency’s website: http://www.cra-arc.gc.ca/bnfts/menu-eng.html.  Share Custody Parents Beware:   Do not leave your money to the Taxman! Figuring out what tax credits and benefits you are entitled to and for what period of time can be a complex task.  You should consult with an accountant who will help you breeze through that determination.

Family Law is not a “one size fits all”

Jack is leaving with peace of mind for a one week vacation with the children during the school March Break.  He is feeling much better now that he has spent an hour with a family lawyer he just retained to represent him in the context of his separation from Jill.  Speaking with friends, family members and other well-intentioned – but misinformed – people had left him completely anxious, discouraged and convinced that he would lose it all to Jill unless he hired a “big gun” lawyer, took a “go-for-the-throat” stance in his separation process and spent half of his retirement savings in legal proceedings.   The lawyer he retained was reassuring, clearly explained to him his rights – yes, men and women have equal rights – and obligations and, most importantly, explained to him that it was not necessary to create a legal war to arrive at a fair and equitable settlement, even if he and Jill did not see eye-to-eye on many things.

On top of all of that, Jack learned that when you are going through a separation, you need to be very careful about who you listen to.  During this one-hour informational meeting, Jack learned that he, just like many of his supporters, had many misconceptions about family law, separation and divorce.  Among other things, Jack learned that he was WRONG to believe that: 

1. Couples living in common-law relationships had the same rights and obligations than married couples;

2. The laws about separation and divorce are the same throughout Canada;

3.  A spouse’s extra-marital affairs and/or bad behaviour could result in a less favourable financial settlement for that spouse;

4.  If Jill remarried, his spousal support obligations would automatically stop;

5.  Having joint custody of the children would mean that neither he or Jill would have to pay child support to the other;

6.  “Joint custody” meant that the children spent one week with one parent and one week with the other;

7. Even if he and Jill had signed a marriage contract (something he had thought about asking Jill to sign when they got married), the result would be the same (i.e. that a marriage contract not worth the paper it is written on, as they are not recognized by courts when there is a separation);

8.  If Jill refuses to let him see the children as he wants, he has the right to stop paying child support;

9.  When his children are twelve years old, they can choose where they want to live;

10.  If push comes to shove, he could just take a lower-paying job and would not have to pay spousal support.

There is lot to be said about family law issues, and many people have an incredible amount of misconceptions about them. That’s why it is very important to be careful about who you listen to when you go through a separation as what applied to them may not apply to you.  Just remember that family law is not a “one size fits all” and getting clear and reliable information about YOUR family matter can avoid costly  battles as well as future headaches and heartaches. 

March Break Fun Without Me!

Sitting at her window, Jill is looking at the snowflakes falling slowly in her backyard.  With sadness, she is reminiscing on all the fun in the sun her family used to have during the March school break. Unfortunately, the end of her marriage also brought with it the end of the “family’s” fun in the sun vacation.  This year, Jack is leaving alone with the children on a boat cruise in the Caribbean while Jill stays home shovelling her laneway!

Most parents are exhausted as they try to keep up with their work, the children’s activities, their homework and the daily family routines.  One would think that a single parent would rejoice at having some time alone without the children.  Strangely enough, most parents, especially in the first few years after their separation, feel such a void when the children are visiting with the other parent that they spend their time alone mopping around the house and being – mostly – miserable.  What is important to remember is that you are not alone and you should see this as the perfect opportunity to do something you enjoy and that will lift your mood and feed your spirit.  It is your time to be good to yourself.  You have gone through a lot and you deserve some R and R.  Planning ahead the fun things that you will do during your time alone is as important as making sure that the children have all they need when they are away from home. 

Here are a few tips to help you make the most of this free time and regain your energy. 

1. Cut loose, let your hair down and put your feet up with a tea (or a beer)… every day!  Simply enjoy the peace and quiet in your home.  It may feel strange at first but after a couple of days you may actually enjoy hearing the humming of your  fridge.

2. Call your friends or your family and have a good laugh.  Talk about your most embarrassing moments.  Talking about your ex will only add clouds to your sunny time of relaxation.

3. Buy yourself something you’ve been wanting, such as a book, a new tool, or flowers.  Just choose something that is important to you, even if your budget won’t allow for something extravagant.

4. Treat yourself to a nap, if that’s something you’ve missed and makes you feel better. 

5. Complete a scrapbooking or a renovation project that you never had time to finish and that you can share with your children upon their return.

6. Don’t plan too much and stick to the plan!  Remember, this week is just for you.

Taking care of yourself doesn’t have to be complicated and you don’t have to break the bank to become a happier and more fulfilled single parent.  In fact, most people feel much better about their lives when they take the time to sit down and create their own fun in the sun.

I will NEVER get married again!

Jill cannot stand looking at another heart, cupid or flower which are plastered all over the stores for the upcoming Valentine’s Day.  She vows to never get married again because marriage is too much work, too many headaches and heartaches.  Although she fears being alone for the rest of her life and knows that another partner could provide emotional stability and possibly financial security, she is convinced that one marriage was enough and that love is not for her.

Following a separation, each spouse will be emotionally bruised and will deal with their feelings in a way that is unique to his or her emotional life experience.  Although some may choose to stay alone, others will remarry and many will live common law relationships.  In most Canadian provinces, common law couples do not have the same rights as married couples.  Protecting the assets you currently own becomes even more important and complex when entering a second or third relationship. Having a rock solid cohabitation agreement (for common law couples) or marriage contract (for married couples) is the best way for both parties to protect their assets and to define clearly their rights and obligations.  

Although a domestic contract will allow you to choose how you will divide money and property if there is a separation, issues may arise with respect to how you will manage your financial affairs while living together.  At the outset of a new relationship, most spouses vow to remain financially independent and share 50% of all expenses.  However, many factors may influence that decision such as the number of children living in the home, the disparity in your income, as well as child and spousal support obligations payable to a former family.  What is important is to find simple ways to keep track of monthly expenses and then determine how they should be divided amongst you at any given time as circumstances may change along the way. Here are a few simple tips that can help you better manage your joint finances:

 

1.     Getting a joint credit card dedicated solely for all household purchases such as groceries, kids’ expenses, gas, restaurants, family trips etc.  If no children are involved, it is easy for each spouse to pay 50% of the monthly account balance.  If children are involved, expenses can be shared proportionately (for example 40-60% or 30-70%) depending on the number of children.

2.     Opening a joint bank account where both spouses deposit monthly amounts of money dedicated to pay for household utilities, home renovations, car payments, mortgage etc.  Again, you can decide at the outset which amount is fair for you to pay based on your circumstances and which expenses will be shared or not be shared.

3.     Keeping a “cash’” envelope in the home where each spouse deposits a specific amount of money monthly to pay for take-out, restaurant tips and social activities.  Paying for pizza every Friday night might seem like an insignificant expense at first. However, this weekly treat can become expensive when only one person pays for the whole family.

You may currently be living in bliss but just in case you have already forgotten, the road through separation is long and stressful - even the second time around! You can live happily ever after, if you work from the beginning at not letting financial issues come between you and your spouse.  You now have the knowledge and the opportunity of protecting what you may think is rightfully yours. Talking about money is never easy, but ignoring the issue of joint finances is just like burying a volcano ready to erupt at any time! 

Prenuptial Agreements - An Insurance Policy for Savvy People

Jack is having dinner tonight with his long-time friend Dave who is getting married to his new girlfriend this Summer.   As Jack just spent the past two weeks going through his financial disclosure with a view of beginning the process of dividing his family property with Jill, what a perfect opportunity – he  thought  – to bring the subject of a prenuptial agreement with his dear friend.  After all, isn’t that what true friends are for? Since Jack now understands how the family pie gets divided upon separation – and how quickly it has changed his retirement dreams – he now  realizes that he and Jill could have chosen to do things differently when they got married (had they only known…).  Jack feels that the best wedding gift he can possibly give his best friend is to talk to him about the importance of discussing money issues (and potentially a marriage contract) now that he contemplates to unite in the financial partnership that is marriage (yes, you heard this right). 

Many people are dreading their future spouse’s reaction to the suggestion of a prenuptial agreement (in Canada, the legal term is “Marriage Contract” if you are married or “Cohabitation Agreement” if you are in a common law relationship).  It is generally believed that the purpose of such an agreement   is to prepare for separation or divorce.   This is because most people misunderstand the many purposes that a prenuptial agreement can have and most think that talking about money with your future wife/husband is not sexy...   A marriage contract or cohabitation agreement is akin to an insurance policy for savvy people – you hope that you’ll never have to use it but you have if it becomes necessary.

Who should get a prenup, you ask?  Well, everyone should at least get proper information about legal rights and obligations created by marriage or common law relationship as early as possible prior to making the commitment.  But at a minimum, a contract is highly desirable in many circumstances such as if you own a business, if you entered the marriage with significant assets or if you expect to inherit large sums of money.  In these cases, a prenuptial agreement may not just appeal to you, but will also appeal to your family members who wish for this wealth to be passed on from generations to generations and to your business partners who do not want the business to be paralyzed or affected as a result of your potential separation.  You might be surprised to hear how many businesses go bankrupt as a result of the separation or divorce of its owners (or one of them).  Furthermore, as the rules differ for common law partners, many of them leave long-term relationships with nothing but the shirts on their backs even though they have played a very important role in building the other spouse’s business or financial wealth.

One of the many assurances a marriage contract or cohabitation agreement can provide is the ability for a couple to determine in advance how they will manage their financial affairs during their relationship.  Even if you are 100% positive that you will never separate, statistics show that almost 50% of marriages (the rate is higher for common-law relationships) end in separation and divorce.  The reality is that finances do play a major role in these statistics.  So now that you know, why not fully understand how the law works and how it would apply to you?

Another assurance that a properly drafted domestic contract will provide is that neither spouse will need to spend thousands (and thousands, and thousands…) of dollars on legal fees to settle their affairs in the unlikely event of a separation. Most people I meet do not want nor can afford  to be dragged into lengthy and costly legal disputes post-separation.

And you know what?  If your loved one throws a fit after you bring  up the idea of a prenuptial agreement, that’s a pretty  good indication of how “amicable” the settlement of your financial affairs is likely to be if you ever separate. In fact, I believe that spouses who truly love and trust each other should have sufficient maturity to engage in an open and honest discussion about their views and values surrounding money. The best time to have such a  discussion is NOT when the relationship ends (as is the case for most people), but rather when you enter in the relationship or whenever  you make a major financial decision in the course of your relationship.  Love can move mountains.

Who needs a lawyer? Let’s settle this between us!

Jack is ready to officially move out of the home as he wants to get on with his life.  Since he expects to have significant parenting time with the children, he rented a home which he now needs to furnish.  For that reason, he had a discussion with Jill this morning and gave her a list of things he wants to take with him including furniture, electronics, tools and other household contents.  He also proposed to Jill a way of dividing equally between them their debts, car payments, home expenses and other monthly liabilities.  Jack was told by his best friend Mark that everything needs to be divided 50-50, so that’s how he suggested that he and Jill divide their debts and expenses.  Jill seemed satisfied with the proposal and Jack started drafting a brief separation agreement confirming the parties’ decisions.  After all, Mark and his ex-wife did it this way, they had no problems and they saved a lot of money. In addition, Jack has a copy of Mark’s separation agreement and so it should be relatively easy to just copy the relevant provisions.

For many good reasons, resolving the issues between you and your ex as quickly and cheaply as possible should be your ultimate goal during the separation process.   However, there are a few caveats you should be aware of when you decide to put a family settlement in writing without the assistance of a qualified family lawyer, or at least some guidance from such a professional. Too often, what appeared to have been a simple issue can turn out to be a very complex and expensive one.   When it comes to resolving family law matters, the agreement or the piece of paper signed by both parties may not be a binding contract recognized by the legal system.   In fact, it can be challenged on various grounds and the judge hearing your case may later decide that your “agreement” is null and void.

The first thing you must understand is that in family law, for a contract to be valid it must at least be dated and signed by the two parties before a witness.  Secondly, it is possible for the person who challenges the validity of the agreement to argue that the contract should not stand because he or she:

• Did not understand the nature of the contract, its content or consequences
• Was forced to sign the contract by some form of duress, pressure or undue influence
• Signed the contract without financial disclosure, or
• Feels that the contract is simply unconscionable (i.e. completely unacceptable in  the eyes of the law)

Finally, to make sure that the contract you signed will be enforced by a court if ever challenged by your ex-spouse in the future, you should always obtain independent legal advice (i.e. ask a family lawyer to review your agreement before you sign it).  Make sure that your ex-spouse ALSO gets legal advice but from a different lawyer (the same lawyer cannot give you both legal advice).  If you don’t, you may very well have to deal with the same issue all over again in the future, and at a much higher cost. When advising you on your separation agreement, your family lawyer will make sure that you fully understand the content of your agreement, that you are not signing the contract out of duress or some other form of pressure, and that the financial disclosure obtained from your former spouse allowed you to make informed decisions.

Who said you can keep the car and the investments too?

The Christmas holidays are over and Jill is very happy that things went much better than she anticipated with Jack and the children over the Holidays.  Since their separation in August, Jill has become more financially astute and received as a Christmas gift from her father a book entitled “The Wealthy Barber Returns” (click here to have a peak at that book) which she read while the children were visiting with Jack.  She truly enjoyed this book which explains in a simple and humorous way important financial concepts she needs to understand in order to move on with her life post-separation.  The new year has just begun and Jill feels it is now time for her and Jack to begin discussing how they will divide their family property (assets and debts).   Jack must have read her mind because he sent her an email this morning listing the items he wanted to keep including the new car, the plasma tv, the bedroom suite, and more of the “good stuff”.   That really upset Jill as she felt Jack was only thinking of himself, once again.  Out of exhaustion, she is thinking that it might be better to just let him have his way to finish this off quickly.

When anger is high and feelings are hurt, disputes over the division of household contents often turn into endless emotional battles during the separation process which fuel the litigation and can significantly increase costs to both parties’ detriment.  Remember that what you “feel” is yours may not necessarily be so in the eyes of the law.  Similarly, assuming that you are entitled to «half of everything » just because you were married is not necessarily true either.  To reach a quick settlement and to reduce the stress, some people are tempted to rush through the process of dividing their family property. Others mistakenly believe that dividing everything in half (splitting every asset and every debt in half) is the simplest and fairest way of dividing family property.  Thinking that the settlement was fair they then chose to sign a “kitchen table” agreement (i.e. one drafted by themselves without legal advice) to put the issue behind them.

In reality, dividing your assets and debts, while it does not have to be a complicated, requires a much deeper analysis in most circumstances and should never be accomplished without a deep understanding of the long-term consequences of any given property settlement.  Doing so could result in a settlement that is completely unfair to you and / or which may have very serious financial consequences in the future which you were not aware of.  A separation agreement should never, (and I repeat) never be signed unless you have spent at least one hour with a family lawyer who can explain to you what you are fully entitled to by the law, what you may be leaving on the table and what the long-term financial implications of your decisions will be. Experience has shown that settlements which seemed simple and fair at first glance do not necessarily stand the test of time and you would not want to be eating cat food just because of hasty decisions you made to settle your separation quickly.