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Posts Tagged ‘BC family asset division’

BC SPOUSAL SUPPORT ALERT-VARIATION AND SELF SUFFICIENCY LEADS TO CANCELLING OF SUPPORT-THE PRICE IS RIGHT!

Friday, April 8th, 2011

Ari Wormeli at our Vancouver Downtown Office


Recently, there was a critically important B.C. spousal support decision reached by the British Columbia Court of Appeal, deciding this B.C. spousal support issue in the Vancouver Registry under the Divorce Act. This was an appeal of an earlier B.C. decision on spousal support and spousal maintenance in the Supreme Court. Ari Wormeli who works primarily at our Surrey BC family law office at 17th Avenue and 152nd Street and whose number is 604-560-6007 wants you to be aware of this decision.

In this B.C. spousal support and spousal maintenance decision, the B.C. Court of Appeal in Vancouver upheld the B.C. Supreme Court spousal support decision to vary and terminate an Order for spousal support and maintenance, because it found that the recipient spouse had become self-sufficient.

Lorne N. MacLean of the MacLean Family Law Group in Vancouver, B.C. wants the public to know that if they are paying spousal support and there is a court Order or Separation Agreement in place, and the recipient of the spousal maintenance is now self-sufficient, they should get legal advice.

The B.C. Court of Appeal, sitting in Vancouver, stated, Price v. Price, 2010 BCCA 452:

35 The plaintiff contends that the judge erred in finding her to be financially self-sufficient, and in holding that the parties’ circumstances in relation to their net assets were roughly equivalent. The plaintiff contends the judge failed to consider all of the other factors relevant under s. 17(7) of the Divorce Act….
38 Similarly, I cannot say the judge erred in concluding that the objectives of s. 17(7) of the Divorce Act had been achieved and satisfied, and that the plaintiff was self-sufficient.

In the original trial decision, the Honourable Mr. Justice Warren stated:
[76] In reference to the objectives found in s. 17(7) I am satisfied that the original order and the later agreements recognized the disadvantages as well as the advantages which arose from the marriage and its breakdown. The plaintiff received the former matrimonial home and she was able to rent out a portion of it to supplement her income from all sources including the support from the defendant. As noted, she has sold that house for a profit and purchased a less expensive home for her and the children and her expenses are thereby reduced somewhat. I cannot find that there has been a failure or lack of apportionment of any financial consequences arising from childcare, or at least none have been brought specifically to my attention and I find that there is no need to further address any economic hardship as contemplated by s. 17(7)(c).
• The parties married in 1987 when both were 30, and separated 13 years later in October
• There were two children of the marriage, born in 1992 and 1995, roughly 18 and 15
• There was a previous court Order made in 2005
• The wife received favourable property division, and their assets were now roughly equal
• The children were now older
• The wife was working full-time
• She was found to be self-supporting

If you are either receiving or paying support and you think these facts are similar to yours, please call us today for advice.

BC SEPARATION AGREEMENT WIN FOR MACLEAN FAMILY LAW GROUP IN ENFORCING A PROPERTY AND SUPPORT AGREEMENT

Thursday, November 18th, 2010

Lorne MacLean BC Separation Agreement and Family Law Lawyer


The MacLean Family Law Group are delighted to have just won an enforcement of a BC separation agreement case for Ms Bayne where the separated BC parties had negotiated a Vancouver separation agreement and reduced the separation agreement to writing by way of letters but once the agreement was converted to a Consent Order for the husband to sign he refused to do so. You can see how the prompt, fair and ethical negotiation took place between the parties, with BC Family Law Lawyer, Lorne MacLean acting on behalf of the wife and the husband acting for himself but who apparently had an unspecified legal advisor in the background assisting him.

It was a nice win for the MacLean Family law Group and we also appreciate the BC Supreme Court’s comments on Lorne MacLean’s diligent work in negotiating the end to a very lengthy and difficult high net worth settlement.

This issue happens frequently in negotiations and it is an important case on what you must prove to enforce a settlement.

The Court Held:
[23]I am satisfied on the evidence that as of December 30, 2009, Mr. and Mrs. Bayne were ad idem with respect to the terms upon which their dispute was to be resolved. To put it simply, there was an
agreement that the family assets consisted of those listed by Mr. MacLean in his draft order. There was an agreement as to how those assets were to be divided between the parties. In particular, there was
an agreement that Ms. Bayne would pay $150,000 to Mr. Bayne and would give up any claim to spousal support, RSP reapportionment, and a division of Mr. Bayne’s pensions, in return for all of which she
would have full title to the matrimonial home. In this way, their agreement met basic contractual requirements, was intended to have legal effect with respect to the couple’s rights and obligations, and be
final and determinative of the significant issues between the parties: see Lahaise v. Lahaise, 2006 BCSC 1052 at para. 12.

29] Ms. Nordlinger pointed out that Mr. MacLean had never said anything to Mr. Bayne about representing only Ms. Bayne and not acting for Mr. Bayne, until the final letter of January 5, 2010. But Mr. MacLean had made it quite clear in November of 2006 that he was acting for Lorraine Bayne. There is no evidence at all to suggest that Mr. Bayne was under any illusion to the contrary.

[30] Ms. Nordlinger then asserted that the change in format set out in Mr. MacLean’s letter of August 18, 2009, was significant, and of a sort that would not be evident to a layperson. The significance, she submitted, is that if everything is set out in a separation agreement, the court can assess its fairness pursuant to the provisions of the Family Relations Act, and, if appropriate, order a reapportionment of assets. To put those terms in a court order, however, insulates them from later variation by the court – except for the mutual waiver of maintenance, which was to be in the form of an agreement. In this, Ms. Nordlinger relied on Schlenker v. Schlenker (1999), 72 B.C.L.R. (3d) 203. These changes, she asserted, favoured the claimant.

[31] If that is so, then surely that is what lawyers are expected to do: attempt to resolve things in a manner as favourable to their clients’ interests as possible. Not only was it open to Mr. Bayne to obtain legal advice about this change, but he expressly stated that he was going to do so. Mr. MacLean can hardly be faulted for the fact that he did not. But in the circumstances of this case, I do not think the proposed change in format matters very much.

In the end Ms Bayne retained the home, its appreciation in value and the security it provided to her while Mr Bayne received the certainty that he had dealt fully and fairly with the issue of spousal support given his much greater employment income.

If you have a complex separation agreement issue give us call at 1-877-602-9900 as we act throughout BC.

New BC Family Relations Act Definition of BC Spouse Changes BC Common Law Spousal Support and BC Property Rights for BC Unmarried Persons

Wednesday, October 13th, 2010

MacLean Discusses Changes to Common Law Rights with BC AG Lawyers


If you are a BC unmarried person in a BC common law- also called a BC marriage-like relationship- the rules of the game for British Columbia spousal support and for BC property division are about to radically change. The definition of “spouse” that controls the rights you have to spousal support have been expanded due to the following change in wording to the definition:
“spouse” means a person who
(a) is married to another person,
(b) lived with another person:
(i) in a marriage-like relationship for a continuous period of at least 2 years, or
(ii) in a marriage-like relationship of some permanence if the persons are together the parents of a child

and, for the purposes of this Act, the marriage-like relationship may be between persons of the same gender.

This wording change means spousal support may be payable if a child is born of the relationship and the relationship is of some permanence (no one is sure what this means yet!) as opposed to the current requirement that you must have lived together continuously for more than 2 years. Can a one night stand where a child is born be of some permanence or is 30 days enough or what will it it take to meet this new test?

Similarly, although the Supreme Court of Canada has said BC common law couples should not be treated the same as married persons, the British Columbia government has decided to treat common law couples who meet this new definition of “spouse” the same for purposes of property division. To make matters even more confusing the British Columbia government has decided to change the rules of the game for married persons as well. To find out what these new rules are for property division, go to our article on the new changes by clicking here.

BC FAMILY RELATIONS ACT FAMILY PROPERTY DIVISION REFORMS DEMAND IMMEDIATE ATTENTION BY MARRIED AND UNMARRIED PERSONS

Sunday, October 10th, 2010


Lorne MacLean, Partner at MacLean Family law Group and the Attorney General of BC Representatives Discuss the Upcoming Changes to the BC Family Relations Act at CBA Vancouver Family Subsection Meeting

BC married and common law persons in strained BC family law relationships who own BC family assets and those considering getting married in BC who have family property need to be aware that big family property division changes are coming to British Columbia’s Family Relations Act, the law governing property division for married couples and the law that will likely soon do the same for many unmarried couples living in marriage like relationships.

Property division laws in BC are the subject of a broad ranging proposal for change as part of the new Family Relations Act Reform White Paper that is expected to form legislation in 2011. The changes are dramatic and parties need to review their positions now to see whether the old or new regime better meets their goals should their relationship be on shaky ground.
British Columbia’s Family Relations Act Property Division Regime has been criticized as too complex and on other grounds such as:

- granting Judges too much discretion in deciding what assets should be divided and then in deciding in what proportion they should be divided either equal or unequal. Many of theses concerns were raised in the SCC case of Young v. Young where Mr. MacLean, founding Partner of the MacLean Family Law Group obtained a 100 percent reapportionment of the family home for his client and where the issue of family debts was clarified.

- the procedure can be time-consuming and expensive as it is not always easy to determine whether an asset has been used for a family purpose.

- the current regime treats similar kinds of property differently. For example, RRSPs, including the amount accumulated before marriage, are subject to division while the general rule for pensions is that the pre-marriage portion is not divided.

- the current law does not provide sufficient clarity about what to do with certain kinds of property, such as gifts, inheritances, ventures, court awards and income tax refunds.

- the current law does not specifically address division of debts although Mr. MacLean did argue how debts could properly taken into account under the current regime in the SCC decision Young.

BC Government’s Recommended Policy
It is proposed that the new family legislation move to an excluded property model that involves less judicial discretion, particularly at the initial stage of identifying which assets are subject to division.
Family property will include all real and personal property owned by one or both spouses at the date of separation unless the asset in question is excluded, in which case only the increase in the value of the asset during the relationship is divisible. Whether an asset was ordinarily used for a family purpose will not be relevant in deciding if it is family property.
Proposed exclusions include:

ï‚· gifts and inheritances to one spouse;
ï‚· settlements or damage awards from tort claims, except that part meant to compensate
both spouses or to replace wages;
ï‚· non-property related insurance proceeds, except that part meant to compensate both
spouses or to replace wages;
ï‚· pre-and post- relationship property; and
ï‚· trust property, unless the beneficiary spouse has an immediate and absolute interest in the
trust property or has the power to terminate the trust.

Where there is a dispute about whether an asset is excluded property, the person claiming the exclusion will bear the burden of proof. While spouses will share in the increased equity in an excluded asset, there remains an outstanding policy issue of what to do with decreased equity in an excluded asset.

The Government says the most compelling reasons for moving to an excluded property regime are to make the law simpler, clearer, easier to apply, and easier to understand for the people who are subject to it. They argue the new model seems to better fit with people’s expectations about what is fair. They “keep what is theirs,” (such as pre-relationship property and gifts and inheritances given to them as individuals) but share the property and debt that accrued during their relationship. Where one spouse enters the relationship with more assets than the other, providing that spouses share the increase in the value of the excluded property promotes a fair outcome. For example, assume one spouse enters the relationship with a house and a mortgage. During the relationship, the spouses pay down the mortgage and invest in renovations to the house. Upon separation, the spouse who brought the house into the relationship retains the value the house had at the beginning of the relationship, and the associated mortgage. The spouses share in the increased equity flowing from renovations and mortgage payments over the duration of the relationship.

Changing to an excluded property scheme removes the broad judicial discretion from the asset identification stage and leaves some discretion at the distribution stage. This change is designed to make it easier to identify property subject to division and, therefore, reduce the potential for disagreement.

As with the current law, the new property division scheme will presume a 50-50 division of all family property but strangely the court will still have the power to divide assets unequally if it would be clearly unfair not to do so and the court could in rare circumstances even divide the excluded assets! The new law will also presume family debts are to be equally divided.

The biggest change of all however, is the proposal to treat common law spouses who have lived together for more than 2 years or who have a child in a relationship of some permanence THE SAME AS MARRIED PERSONS FOR PROPERTY DIVISION PURPOSES.

Call us province wide at 1-877-602-9900 if you wonder what regime is more favourable to your situation and whether a marriage agreement makes sense for you.

Lorne MacLean

New BC Family Relations Act Reform 2010 BC Family Law White Paper-Lorne N. MacLean interviewed on CKNW AM 980 on the Proposed BC Family Law Act

Monday, July 19th, 2010

New BC Family Law changes- BC Family Relations Act Reform 2010 and the BC Family Law Act White Paper provides dramatic BC Family Law reforms to BC spousal support, BC family property division, BC common law property division, BC child custody-Lorne N. MacLean will be interviewed on the BC Family Relations Act Reform Law , tonight at 5:30PM on CKNW AM 980. Mr. MacLean will be talking about important new changes to the Family Relations Act. The new act will be called the Family Law Act and the deadline for written input/comment on the white paper will be October 8, 2010. Some of the proposed changes to Family Relations Act reflect issues that Mr. MacLean has addressed before the Supreme Court of Canada in Young v. Young [1993] 4 S.C.R. 3 and in the Leskun v. Leskun [2006] 1 S.C.R. 920 decision. Some of the proposed changes will address the property rights of married and common-law couples; guardianship of children and decision-making about children; the enforcement of access orders; mobility and relocation issues; spousal support; and, parenting coordination, arbitration and mediation. Below is the executive summary, for the report click here.

New Family Relations Act Reform 2010 Changes Coming


White Paper on Family Relations Act Reform 2010 EXECUTIVE SUMMARY

British Columbia’s Family Relations Act has not been comprehensively reviewed since its introduction in the late 1970s. Since 2006, the British Columbia Ministry of Attorney General has been researching and consulting on how best to modernize this important area of the law. The draft legislation discussed in this white paper reflects the results of its policy review.

The main features of the proposed new family statute are:

TOPIC RECOMMENDED POLICY
Overall Approach Promote co-operation to the extent possible. For example:

  • Structure the law so that court is not the only implied starting point.
  • Promote a broader range of non-court dispute resolution options.
  • Adopt a conflict prevention approach to family law disputes.
  • Increase the law’s ability to deal with family violence and safety issues.
  • Use less adversarial terminology.
  • Meet the overall goals of the Family Relations Act review.

Non-Court Dispute Resolution and Agreements

Promote non-court dispute resolution. For example:

  • Require family justice professionals to provide early information to clients on dispute resolution options.
  • Enable parenting coordination by agreement or court order.
  • Amend the Commercial Arbitration Act to address family arbitrations.
  • Provide for regulation-making authority to define practice standards/qualifications for family dispute resolution practitioners, as and if required.

Encourage agreements by providing greater clarity regarding when and how an agreement may be set aside:

  • Parenting agreements may be set aside if they are not in the best interests of the child.
  • Child support agreements may be set aside if they fail to comply with the Federal Child Support Guidelines.
  • All agreements may be set aside for lack of procedural fairness, such as significant failure to disclose or where one party has taken unfair advantage of the other.
  • Property and support agreements can be set aside for non-procedural reasons in limited circumstances where it would be clearly unfair.

Legal Parentage
Include a comprehensive scheme to determine a child’s legal parents, including in situations where reproductive technology has been used.

Children’s Best Interests

  • Make children’s best interests the only consideration in parenting disputes and identify children’s safety as an overarching objective of the best interests of the child test.
  • Add further best interests factors, including the history of the child’s care, family violence, and consideration of civil or criminal proceedings relevant to the safety or well-being of the child.
  • Provide for consideration of a child’s views unless it would be inappropriate  to encourage greater inclusion of children’s views

Guardianship- Enact reforms to the Act’s treatment of guardianship, including the following:

Replace the terms custody and access with guardianship and parenting time.
Define guardianship  through a list of parental responsibilities that can be allocated to allow for more customized parenting arrangements.

Provide that parents retain responsibility for their children upon separation if they have lived together with the child after the child’s birth. (Note: this does not mean that the law presumes an automatic 50-50 split of parental responsibilities or parenting time.) If they have not, the parent with whom the child lives is the guardian.
Consolidate guardianship of children into the new law by including testamentary and standby guardianship.

When Orders or Agreements for Time with a Child are not Respected

Include a new range of tools and remedies to address non-compliance with orders and agreements for time with a child:
Remedies range from moderate to extraordinary remedies depending on the facts of the situation and history of non-compliance.
Provide different remedies for failure to allow parenting time/contact and failure to exercise parenting time/contact.

Relocation

Introduce a relocation regime that aims to increase certainty and predictability of the law of relocation, the highlights of which are:
Include a mandatory 60-day notice-of-move provision, to provide an opportunity for parties to try to resolve any disputes about the proposed move.
List factors that must be considered (e.g. the reasons for the proposed move and whether the proposed move is likely to enhance the general quality of life of the child and the guardian planning the move) and factors that must not be considered (e.g. whether the guardian would be willing to move without the child in any event).
Include presumptions to be applied where the proposed move is contested.

Children’s Property
Add provisions relating to children’s property that would:

  • Enable a child guardian(s) to manage property below a certain monetary threshold without a court order.
  • Provide court oversight of larger children’s trusts, including the appointment of private trustees.

Property Division

Enact major reforms to the law of property division regime, that would:

  • Extend it to common-law spouses who have lived together for two years in a marriage-like relationship or who are in marriage-like relationship of some permanence and have children together.
  •  Exclude certain types of property (e.g. pre-relationship property, gifts, and inheritances) from the pool of family property to be divided 50-50.
  •  Limit judicial discretion to reapportion family property or to divide excluded property to circumstances where it would be clearly unfair not to do so.
  • Provide that debts are subject to equal division.
  •  Set as defaults: the date of separation as the triggering event and the date of the court order or agreement as the valuation date.
  • Limit the ability of judges to set aside or change property division agreements.
  •  Enable interim orders, including for the distribution of property for the purposes of funding litigation or dispute resolution.
  • Enact conflict of laws provisions to address property outside of British Columbia.

Pension Division

Enact most of the major and housekeeping recommendations made by the British Columbia Law Institute in its 2006 report on the division of pensions.
Extend the pension division scheme to unmarried spouses who meet the definition of spouse.
Support Minor changes to the child support provisions to ensure consistency with new Act’s language and
structure.

Minor changes to spousal support provisions:

  • Align provincial spousal support factors and objectives more closely with the Divorce Act.
  • Explicitly permit periodic reviews.
  • Permit variation applications in light of the spousal support objectives and factors where there has been a change in circumstances, new evidence or a failure to make full and frank disclosure.
  • Limit consideration of a spouse’s alleged misconduct to that which œarbitrarily or unreasonably affects the need for support or the ability to provide it.
  • Provide that spousal support obligations continue after the death of the paying spouse unless otherwise agreed or ordered.
  • Clarify that spousal support should be awarded only where spousal support objectives have not already been met through property division.
  • Spousal Support Advisory Guidelines will not be referred to in the Act and will remain advisory.

Eliminate parental support obligations.

Case Management and Enforcement Tools

Include a broader range of case management and enforcement tools for judges. In particular:

  • Provide for a new type of order called “conduct orders” and corresponding remedies for non-compliance to manage behaviour and facilitate resolution, for example, through referrals to a service, program, counselling or non-court dispute resolution process,
  • providing for a party to pay the other’s reasonable expenses incurred as a result of the non-compliance, and limiting frivolous or vexatious litigation.
  • Establish a general duty to disclose information, and provide for a greater range of remedies for failure to comply with an order to disclose.

Protection Orders

Replace existing family law restraining orders with protection orders enforceable under the Criminal Code.

Court Jurisdiction and Procedural Matters

The new family statute will carry forward many of the jurisdictional provisions from the Family Relations Act. Proposed procedural changes include the following:

  • Lawyers must certify that information about non-court dispute resolution options has been provided prior to filing court documents.
  • Family cases are to be conducted, to the extent possible, in a way that minimizes delay, cost and formality, reduces conflict and promotes co-operation, protects those involved, and is proportionate to the dispute.
  • Children who are 16 or older or who are parents, spouses or former spouses will be able to conduct court cases without a litigation guardian.

Transition

Where a court action has been started but not yet resolved before the effective date, the Family Relations Act applies unless the parties enter into a written agreement stating that the new Act governs. Cases that have already been time-barred under the Family Relations Act are not revived by the new Act.
Where a court action has been started on or after the effective date, the new Act applies.
Orders and declarations made under the previous law continue in force according to their terms, but subsequent applications made on or after the effective date (e.g., to vary or enforce) are governed by the new Act.

BC FAMILY ASSET and BC PROPERTY DIVISION- NEW BC FAMILY LAW RULES ALLOW INTERIM ADVANCES FOR BC LEGAL FEES AND EXPERT REPORTS

Sunday, July 11th, 2010

BC Family Law and Interim Distribution of BC Family Assets and Advances to Pay BC Legal Fees: Who Pays the Piper in Divorce?

We are all familiar with the notion that “he who pays the piper calls the tune,” but what happens when you don’t have the money to pay the piper? In contested divorce cases it is not uncommon for legal fees and expenses to reach the point where you face difficulty paying your lawyer to represent your interests for lack of funds. In cases of mid to high net worth divorcing couples there are usually substantial assets that require dividing – bank accounts, trust/income funds, houses, property (local and foreign) and insurance policies to name but a few. Assets by their very nature have an intrinsic monetary value. The question is whether or not a divorcing spouse short on capital before a trial needed to pay their legal fees can access these assets or borrow against them to pay past, present and future legal expenses before the trial that will likely divide these family assets- most often equally? Is there any reason that all assets should remain untouchable until the trial is over and judgment rendered?

A new rule may allow people access to income and assets before a trial where in the past this was more difficult if not impossible to achieve. Lorne MacLean of the MacLean Family Law Group points out new BC Supreme Court Family rule 12-1 may allow a much needed interim advance of funds for a spouse needing funds to live on or to pay legal and expert fees as it states:

Photo Lorne MacLean BC Family Law Attorney

BC Supreme Court Family Law Rule 12-1

Allowance of income from property
(3) If property is the subject matter of a family law case and the court is satisfied that the property will be more than sufficient to answer all claims on it, the court at any time

(a) may allow the whole or part of the income of the property to be paid, during such period as the court may direct, to a party who has an interest in it, or

(b) in the case of personal property, may order that part of the personal property be delivered or transferred to a party.

Recovery of specific property
(4) If a party claims the recovery of specific property other than land, the court may order that the property claimed be given up to the party, pending the outcome of the family law case, either unconditionally or on terms and conditions, if any, relating to giving security, time, mode of trial or otherwise.

In the past a party claiming an advance against their ultimate share in property met with stiff judicial precedent against them.
In British Columbia the leading authority – Ansari v. Ansari [2000] BCJ No. 763 – holds that advances (interim distributions) or borrowing funds against family assets subject to division in a divorce proceeding to pay past, present and future legal fees are not allowed except to fund unusual disbursements relating specifically to the valuation of assets. In Ansari v. Ansari [2000] B.C.J. No. 763 (BCSC) – Macaulay J.noted:

(a) Jurisdiction for interim payment from family assets founded in s.66 of the Family Relations Act (as decided in Erskine v. Erskine (1991) 31 R.F.L. (3d) 273)

(b) Two step test established by Kirkpatrick J. in Jiwa v. Jiwa [1992] B.C.J. No. 3024 (S.C.):

(1) Is the advance required to mount a challenge to the other spouse’s position at trial?

(2) Will the advance or the payment on an interim distribution basis jeopardize the other spouse’s position at trial?

Macaulay J. held at paragraph 28 in Ansari:

As the interim distribution of assets sought relates primarily to past and projected legal expenses in the matrimonial litigation, entitlement falls to be determined, in my view, within s.66 and with regard to the limitations expressed in earlier decisions. The weight of authority is against ordering an interim distribution of assets to meet past and, in particular, future legal expenses except to fund unusual disbursements relating specifically to the valuation of assets. I decline to order an interim distribution in favour of either party.

The more recent case of Herr v. Herr [2006] B.C.J. No. 1624 – held as in Ansari that no interim disposition of funds should be allowed allowed and at paragraphs 19 and 20 Ralph J. stated:

“The purpose for which the true interim distribution was required was not specific but appeared to be for past and future legal expenses. As recognized in Ansari the weight of authority is against ordering an interim distribution of assets to meet past and future legal expenses except to fund unusual disbursements relating to the valuation of assets.”

“In my respectful view, having already authorized a substantial draw upon these funds to pay the arrears of support, the Master erred in further authorizing the payment of $40,000 for the unspecified past and future legal expense. I conclude that Mr. Herr’s appeal with respect to the Master’s order relating to the interim distribution of $40,000 should be allowed and that the order must be set aside.”

Similarly, in Hiemstra v. Hiemstra [2001] B.C.J. No. 522 – No interim distribution of funds was allowed to pay legal fees and in McLeod v. McLeod [2001] B.C.J. No. 1201 (S.C.) – Kirkpatrick J. followed Ansari and refused to make an interim order for distribution of funds for legal fees. Kirkpatrick J. also followed the Pierce decision, in that she did not find that “such an advance is, in equity, required”. The distinguishing features in this case are that the wife was already receiving a substantial sum (close to $5000 per month) for child support and the husband was paying a good portion of the household expenses, and spousal support of almost $4000. Therefore, the circumstances were not so dire as to require the disbursement of funds to the wife out of the property.

An older line of cases did allow some advances for legal fees:

(a) Pierce v. Pierce [1994] B.C.J. No. 3079 (S.C.) as per Melnick J. – the focus in ordering an advance is not whether it is required for one spouse to fund his or her lawsuit against the other, but rather whether, in order to make a determination regarding assets, as contemplated by s.52 of
Family Relations Act, such an advance is, in equity, required.

(b) Ford v. Ford (6 February 1992), Vancouver Registry A913765 – allowed for release of funds for legal fees.

(c) Newbury J. in Lane v. Lane [1991] B.C.J. No. 3246 (S.C.) – lump sum payment ordered to reimburse a wife for past accounting and legal expenses but would not order payment for estimated future legal expenses.

The big change regarding experts in family matters is the emphasis on 1 neutral expert being appointed by consent or if disputed by court order as follows:

Single Court Appointed Expert
13-4
Application to court
(3) If the parties do not agree that a joint expert is required or do not agree on any matter relating to the appointment of a joint expert, any party may apply to the court in accordance with Rule 10-5 for an order
(a) appointing a joint expert, and
(b) settling any matter relating to the appointment of the joint expert.

Note also full cooperation is required and full disclosure mandated under this rule.

Appointment of Court’s own Expert
13-5
(10) The remuneration of an expert appointed under this rule
(a) must be fixed by the court and consented to by the expert, and
(b) may include
(i) a fee for the report, and any supplementary reports, required under Rule 13-6, and
(ii) an appropriate sum for each day that the expert’s attendance in court is required.
Security for remuneration

(11) The court may make one or both of the following orders, without prejudice to any party’s right to costs:
(a) an order directing that the expert’s remuneration be paid by the persons and at the time ordered by the court;
(b) an order for security for the expert’s remuneration

If you have an issue with needing to access monies you are properly owed before trial call us toll free at 1-877-602-9900 to help you ensure your case is handled properly and that funds you need to protect your rights and properly instruct your lawyer and valuation experts can be obtained.

BC CHILD CUSTODY and BC CHILD MOBILITY UPDATE-Moving a Child Away

Tuesday, April 20th, 2010

Summer at MacLean Family Law Group's Fort St John BC Office

BC Child Custody and BC Child Mobility or change of residence cases often involve the need by one parent to move themselves and their child away from their existing residence- classified as BC child mobility or change of residence- to return to be closer to family support, to move away to obtain a promotion or to accept a required transfer, or to move with a new partner for one of the same reasons. What is good for one parent -and possibly for the child whose life is bound inextricably with the parent- is often the exact opposite for the other parent and possibly for the child as well. In cases where one parent is the sole custodian and the other parent has limited involvement, the decision to allow a parent with custody to move away is an easy one but those cases are rare. I often tell the courts we have a wonderful child with two great parents and that shared custody is the best possible outcome but how can you maintain maximum contact by the child to both parents if one parent and the child are allowed to move away?

In the past the court looked at the option of deciding whether the parent and child could move or whether they would be forced to remain “prometheus bound” to their present location despite lost opportunities to improve the moving parent’s life. If the court allowed a parent to move away with the child its’ result would largely sever maximum contact to the parent who remained behind in the original location.

A recent BC Court of Appeal decision has approached the problem of child mobility by adding a developing concept the writer and other lawyers have postulated for some time:

1. Consider whether both parents should remain in the same location;

2. Consider whether one parent and the child should move away;

3. Allow the parent who wants to move to move but leave the child in the care of the remaining parent-this often
forces the parent wanting to move to pick between sacrificing their career or their custody of the child;

4. Consider whether both parents can move to the new location and maintain the same regime
of care and control of the child as was in place in the old location.

I have often argued that plans to move are ill conceived and offer no clear benefit over the current regime. I have also argued- in cases where the access parent is unemployed and/or providing little positive parenting assistance or financial aid- that a move with a new partner to a new location or by one spouse to a new city with a solid financial upside that the move should proceed and the parent who has no job or a nominal income could easily move there and do as well in the new location and maintain the existing contact with their child.

The recent BC Court of Appeal decision of S.S.L. v. J.W.W., 2010 BCCA 55 set out how all four approaches must be properly considered by a trial judge in a child focussed approach.

Discussion

[21] The point of departure in Canada for any parental mobility case must be the Supreme Court’s decision in Gordon. In Nunweiler, this Court was clear that the approach set down in Gordon to a custodial parent’s variation application was to be taken, insofar as applicable, to an original application regarding children whose parenting they had been sharing.

[22] However, as the plethora of judgments that have applied Gordon demonstrate, the factors listed at para. 49 in the judgment of McLachlin J. (as she then was) provide insufficient guidance for two good parents, their counsel, and the trial court as they face the agonizing decision required in two circumstances: (1) a pre-school age child who has been in the primary care of one parent (usually the mother) where age-appropriate access is unworkable if one parent moves away (Karpodinis v. Kantas, 2006 BCCA 272, leave to appeal refused [2006] S.C.C.A. No. 318; Hanna v. Hanna, 2002 BCCA 702), and (2) a joint parenting situation where one or both parents’ needs (economic, educational or personal) are seen as requiring a change.

[23] This case falls within the second group, in some of which, as here, the only issue is the child’s primary residence, because the parents agree that joint guardianship and joint custody should continue.

[24] In my view, the court’s task in these joint parenting cases is to analyze the evidence in four possible scenarios, in this case, (i) primary residence with mother (London, Ontario); (ii) primary residence with father (Victoria, B.C.); (iii) shared parenting in Victoria; and (iv) shared parenting in London, but to do so knowing the court’s first task will be to determine which parent is to have primary residence. When the question of primary residence is evenly balanced and the court finds the best interests of the children require both parents to be in the same locale, then the court will need to choose between the shared parenting options offered by the parents, without presuming the current care-giving and residential arrangement is to be the preferred one.

[25] Proximity of parental homes will usually be in the best interests of children with two good parents. But proximity may be achieved in either proposed location. The choice of the existing location cannot be the default position. In Woodhouse v. Woodhouse (1996), 136 D.L.R. (4th) 577 (Ont. C.A.) at para. 89, Osborne J.A. observed in dissent (at para. 89):

[89] … Balancing the relevant factors is required in order to accommodate the broad post-separation spectrum of parenting arrangements with which courts will be confronted. It is essential, I think, that the process be flexible and realistic. In some cases, when the relevant factors are balanced, it will be appropriate to deny the custodial parent the right to move with the children. In other cases, asking the non-custodial parent to move may be more in the children’s best interests than requiring the custodial parent to stay. Consistent with the majority judgment in Gordon, I do not think that any one of the relevant factors should be viewed as dispositive so as to automatically determine the outcome. [Emphasis added.]

[26] Authorities in other jurisdictions reveal similar views. In U. v. U, [2002] HCA 36 at paras. 175-76, Hayne J. wrote, in concurring reasons for the High Court of Australia:

[175] When one parent (for whatever reason) wishes a child who is, or is to be, resident with that parent to move to a place distant from the other parent, it should not be assumed that that other parent cannot, or should not, contemplate moving to be near the child. There may be (and for all that is known, in this case there was) compelling reason for that other parent (here, the father) not to move, but it would ordinarily be expected that these reasons would be explored in evidence and the validity of any assumption that the other parent will not move would be examined. Just as, in this case, the mother was asked what she would do, if she could not have the child reside with her in India, so too it might have been expected that the father would be asked what he would do, if the mother were to have the child reside with her in India. Such questions should not be treated as mere forensic tests of parental devotion, to which only one answer is seen as being satisfactory proof of being a loving parent. Rather, they are no more than a prelude to a deeper inquiry about where the best interests of the child may lie and what arrangements will best serve those interests.

[176] It is now recognised as self-evidently true that, apart from some cases of abusive relationships, children benefit from the development of good relationships with both their parents. The right to know and be cared for by both parents and the right of contact on a regular basis with both parents are said to be principles underlying the objects of Pt VII of the Act. If effect is to be given to those principles, it must not be assumed that one parent (the father) cannot move and that the mother must, in every case, subordinate her ambitions and wishes, not to the needs of the child, but to the wishes of the father to pursue his life in a place of his choosing. It is the interests of the child which are paramount, not the interests or needs of the parents, let alone the interests of one of them.

[Italic emphasis in original; underlining emphasis added.]

[27] See also Tropea v. Tropea, 87 N.Y.2d 727 (1996) (N.Y. C.A.); and Payne v. Payne, [2001] EWCA Civ 166 (U.K. C.A.).

[28] This approach to the evidence of both parents avoids the problem of the “double bind” described recently in Bourgeois v. Plante, 2009 PEICA 12 at para. 32:

… Various courts have cautioned that it is problematic to rely on representations made by the custodial parent that he or she will not move without the children should an application to relocate be denied. This inquiry is commonly called the “classic double bind.” If a parent responds by stating they are not willing to remain behind with the children, this raises the prospect of the parent looking after their own interests and not having the interests of the children paramount. Then, on the other side of the equation, if a parent advises the court that they are willing to forego a move if unsuccessful, this suggests that such a move is not necessary for the well being of the parent or the children. If a trial judge mistakenly relies on a parent’s willingness to stay behind “for the sake of the children”, the status quo becomes an attractive option for a judge to favour because it avoids the difficult decision the application presents. See: Spencer v. Spencer, supra.

[29] In cases like this where courts are called upon to make what one judge has called an “educated prediction” (McArthur v. Brown, 2008 BCSC 1061 at para. 161) as to the best interests of the children, based not only on evidence of their old life, but also evidence of what parents believe will transpire in their new life, the parents’ evidence should focus on all of the four possible scenarios.

[30] Such an approach takes into account the court’s inability to order a parent to stay or move and the unfairness of preferring the obstinate over the more flexible. It requires the court to set down his or her analysis of the evidence and the decision path so the parents (and ultimately the children) can understand not only the result but how one of the most important decisions in their lives was made.

[31] In evenly balanced shared parenting situations, careful and transparent analysis of the evidence and reasoning is especially important, if courts are to encourage joint parenting following separation and discourage jockeying for position by the parent in a favoured position (very often mothers because of their historic role in a family) who wants to avoid being frozen in a current location by the co-operative approach generally thought ideal for young children, particularly those not yet well bonded to their father. It acknowledges that the lives of families must accommodate change.

[32] This approach takes the focus away from the time factor that bedevils so much of family post-separation litigation. While courts have said consistently for years that the amount of time, measured in days, over-nights, and sometimes hours, is only one of many factors to be considered in determining care-giver roles, this case exemplifies how it can come to dominate a trial to the exclusion of more important child-centred evidence as to the best parenting arrangements in the circumstances as they are and can reasonably be foreseen to be. Far more significant is the role each parent has played in the children’s lives; which parent has taken primary responsibility for their health, safety, education and overall welfare; which parent deals with the mundane but necessary arrangements of their lives – clothing, haircuts, extracurricular activities, gifts for friends, doctors’ and dentists’ appointments, contact with their extended family; and which parent has the best perception of the emotional needs of the children. In sum, what it is that each parent contributes to the children, as care-giver. Only when those contributions are made clear will an understanding be reached as to what arrangements will work best for the children going forward. The analysis of the parent’s role is fundamental to the determination of a primary care-giver, whether continued shared parenting is in the children’s best interests, and where they should live.

[33] I note that in this assessment of each parent’s contributions to the care of their children, it is inevitable the court will be required to assess the resources available to each, in personal and economic terms that permit them to make those contributions, and the potential effect on those resources in each proposed scenario. As many courts have noted, this may require an assessment of a parent’s emotional and economic prospects because children’s interests are necessarily intertwined with those of their parents: Burns v. Burns, 2000 NSCA 1.

[34] Finally, this approach permits the decisions of each parent to receive the respect to which his or her parenting roles entitles them.

If you have a BC family law case involving child mobility call me, Lorne MacLean at 1-877-602-9900 toll free.

Adultery and Misconduct in BC Divorce and British Columbia Separation

Monday, April 19th, 2010

Lorne MacLean- Divorce Lawyer- brings a Fresh Perspective to Your Case


Many BC divorce and British Columbia Separated parents involved in a BC child custody case think their chances of receiving child custody, more or less support, or a larger share of the family property will change if their spouse has had an affair.

In reality an affair has little if any impact on the issues surrounding marriage breakdown. In the infamous case of Leskun we acted for husband who had had an affair and we were successful in the Supreme Court of Canada in upholding the principle that a spouse’s affair was irrelevant to the issues of spousal support unless it could be proven, supported by medical evidence, that the affair had a negative financial impact the other spouse that prevented them from earning what they normally would have earned. The ability of one spouse to sue the other spouse or mistress for damages for an affair or for “alienation of affection” was long ago abolished in British Columbia. While there still is the ability to sue for damages for physical and mental abuse in British Columbia, the Supreme Court of Canada has narrowed the scope of this claim in their decision of Frame v. Smith.

We warn our spouses that a new relationship during the end of a shaky marriage or immediately after the marriage has broken down can negatively impact a child custody claim if it is shown that the new person is introduced too soon into a relationship or that the new relationship distracts the separating spouse from focusing on their children and putting their children’s interests ahead of their own. A new relationship can also impact and reduce a receiving spouse’s claim for support under some circumstances. We want people to go slow as it is imperative people do not “jump from the frying pan into the fire”.The existence of a new relationship often will not help promote a quick settlement so this is a critical factor to consider as well!

Some people argue that Canada should return to the old fault days of divorce where misconduct resulted in negative consequences to the offending spouse. As an example of what might happen if Canada were to return to the antediluvian days of fault we point to the recent decision in United States below.

Wife’s $9m victory in adultery case warns mistresses to ‘lay off’: Cynthia Shackelford, 60, was awarded the unprecedented sum by a jury in the United States for damages to her feelings under an obscure 19th century adultery law; North Carolina is one of seven states in America where the so-called “alienation of affection” law is still in force. It evolved from common law under which women were classes as property of their husbands. As property, they were something that could be stolen. The award was made against Anne Lundquist, 49, an administrator at a private school, who was accused of having an affair with Allan Shackelford, a 62 year-old lawyer who had been married to Mrs. Shackelford for 33 years. The jury awarded her $5 million compensation and also awarded $4 million in punitive damages to be paid by Miss Lundquist. Miss Lundquist, who is now the dean of students at Wells College, in Aurora, New York, did not attend the court hearing and said she had not even been told it was happening. She is appealing. She said: “I’m so caught off guard by everything. I don’t have a lot of money, so where this $9 million comes from is kind of hysterical.” “My main message is to all those women out there who might have their eyes on some guy that is married to not come between anybody,” Ms. Shackelford told “Good Morning America”. “I wanted other people to understand, before they do it, how much it hurts.” Lee Rosen, of the Rosen Law Firm in North Carolina, said the state has around 200 “alienation of affection” claims a year. He said: “If your spouse is going to cheat, you really would like them to cheat with somebody who has a lot of money.”
As reported in:
Coffee Break – North, Fort St. John, Vol. 1.23 March 27-April 4, 2010

WHAT INCOME IS USED FOR BC SPOUSAL AND BC CHILD SUPPORT FOR A SELF EMPLOYED BC OWNER OF A BUSINESS?

Sunday, April 11th, 2010

Warning-Pre tax profits are the default guideline income for spousal and child support.

We often warn our family clients involved in a BC spousal or child support case that the tax return of a BC self employed spouse does not present an accurate picture of the income that the court will use for determining guideline income for BC child and BC spousal support. Recent cases presume that pre-tax profits are available to pay child support or spousal support from the company the paying spouse owns unless that spouse proves a need to keep profits in the company to advance legitimate company objectives.

In the recent case of Purvis v. Purvis 2009 BCSC 1794 the husband successfully overcame the presumption that pre-tax corporate income will be imputed to a payor when they own or control a company.

This case involved an action by the husband for a review and retroactive variation of a 2002 order for child and spousal support payments. The husband unilaterally decreased the support payments in 2003. The wife claimed that the husband had failed to make accurate financial disclosure for the annual review, which was a term of the Mediated Settlement Agreement incorporated into the 2002 order. She sought payment of outstanding arrears for support and that the husband’s income include pre-tax corporate profits from his holding company. The husband’s 2007 and 2008 income were the years in dispute.

Retained earnings or funds needed to operate?
The husband claimed that for the purpose of tax planning, the company Praetorian Construction Management (Praetorian) paid annual dividends to its shareholders to reduce its retained earnings. The dividends were paid as income to the husband’s holding company Tukcon Holdings Inc. (“Tukcon”). The court examined the pre-tax earnings and the retained earnings for Tukcon, the latter showing a shareholder loan for $730,916 owing from Praetorian. The husband said that Praetorian was not in a position to repay the shareholder’s loan to Tukcon and therefore Tukcon could not pay out the retained earnings balance to its shareholder (the husband).

Application of the law
In applying Section 18 of the Child Support Guidelines the court mentioned Hausmann v. Klukas, 2009 BCCA 32, where it had been held that if there is any evidence of legitimate calls on corporate income for the purpose of continuing the operations of the business the income will not be included in determining annual income thereby “not killing the goose who lays the golden egg” (Baum v. Baum [1999] B.C.J. No. 3025 B.C.S.C.)). The court in Hausmann (supra) said that where a corporation is owned and controlled by the payor spouse, there is a presumption that pre-tax corporate income will be available to a payor in the absence of evidence to the contrary.

Control of the company
In determining who controlled the holding company, Tukcon, the court found that the husband did not present evidence to reveal the extent to which the previous non-voting shareholder (his ex-common law spouse) was involved in the company pre-2009 and that from 2009 he was Tukcon’s only shareholder. Tukcon was one of the 3 companies who owned Praetorian, for whom the husband was the President and the key employee for obtaining new contracts,

Retained earnings required to continue operations
Applying Hausmann (supra), the court found that the husband had to rebut the presumption. On the evidence submitted by the husband’s accountant, the court found that the amount of $700,000.00 in 2007 was legitimately retained by Tukcon to enable Praetorian to continue operations and was not imputed as income to the husband. However, the evidence did not defeat the presumption that the remaining pre-tax profits for 2008 and the pre-tax profits for 2007 and these amounts were imputed as income to the husband.

Support applied retroactively
On another issue, the court cited case law that supports the proposition that retroactive awards should not reach back farther than three years from the date of notice to the payor parent, unless there is blameworthy conduct on the part of the payor D.B.S. v. S.R.G. 2006 SCC 37. The effect of not disclosing a material change in circumstances (his increased income) resulted in the husband having to pay support retroactively to the date when his circumstances changed in 2003. The wife had the reasonable excuse for not bringing her claims earlier of caring for the children and making attempts to become self-supporting.

It is important you call us for advice if you have a support case involving a shareholder, director, or owner of a company.

JP

What Family Property is Shared when we Divorce? BC Family Assets Defined

Friday, April 9th, 2010

When you divorce BC family asset property like the “Wedding Van” above can be divided, most often equally, if they fit the following criteria in one or more of the following ways:

1.s. 58(2)— BC family asset property ordinarily used for a family purpose;

2.s. 58(3)(e)—a venture which fits the BC family asset definition to which the spouse has directly or indirectly contributed; and

3.s. 59—property used primarily for a business towards which a direct or indirect contribution was made by the other spouse to the operation of the business which makes it a divisible BC family asset.

The British Columbia legislation is broad and will capture most property in a marriage but not all. The onus is one the spouse alleging it is not a family asset to prove it is outside the scope of the above factors.

Call us if you have questions on what assets are or are not to be divided upon marriage breakdown. Note different rules apply to unmarried spouses.


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