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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’s 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’s 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 “arbitrarily 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.

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Posted in Blog Articles, Common Law and Same Sex, Custody and Access, Division of Property, General | No Comments »

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.

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Posted in Blog Articles, Division of Property, Divorce Planning, General | No Comments »

BC Law on Varying or Setting Aside Unfair BC Separation Agreements or BC Marriage Agreements 2010 Update

Sunday, April 25th, 2010

We are often asked to review BC separation agreement or BC marriage agreements with a view to setting the BC separation or BC Marriage agreement aside and Shelagh Kinney of our BC Family Law office had a nice win recently in a case on behalf of the wife in L v. L, a BC Supreme Court separation agreement variation 2010 decision.

Our Supreme Court in the Brandsema decision warned spouses that fair agreements made with full disclosure between spouses on an equal footing will be protected but unfair exploitive agreements will not be sanctioned. In Brandsema the Court focussed on non-disclosure by the husband and varied the agreement to give the wife more money on the following basis:

Abella J., speaking for the majority, stated (at paras. 1–6):

“This court has frequently recognized that negotiations following the disintegration of a spousal relationship take place in a uniquely difficult context. The reality of this singularly emotional negotiating environment means that special care must be taken to ensure that, to the extent possible, the assets of the former relationship are distributed through negotiations that are free from informational and psychological exploitation.

…

This appeal, therefore, attracts a spotlight to the duties owed by separating spouses during the process of negotiating and executing a separation agreement for the division of matrimonial assets. In Miglin, based on the inherent vulnerability of spouses during negotiations, this Court stated that in order to safeguard a separation agreement from judicial intervention, a spouse must refrain from using exploitative tactics. It held that the failure to do so, particularly if the agreement fails to materially comply with the objectives of the governing legislation, could well result in the agreement being set aside.

The circumstances of this case move us to consider the implications flowing from Miglin for the deliberate failure of a spouse to provide all the relevant financial information in negotiations for the division of assets. In my view, it is a corollary to the realities addressed by this court in Miglin that there be a duty to make full and honest disclosure of such information when negotiating separation agreements.

The husband’s exploitative conduct, both in failing to make full and honest disclosure and in taking advantage of what he knew to be his wife’s mental instability, resulted in a finding of unconscionability. The trial judge accordingly ordered that the wife be compensated in an amount representing the difference between her negotiated equalization payment and her entitlement under British Columbia’s Family Relations Act, R.S.B.C. 1996, c. 128. On the facts and law, I see no reason to disturb his conclusion.”

Spouses need to approach the settlement negotiations frankly and ensure the opposing party gets independent legal advice. Home made agreements are unlikely to protect either side and a little money and effort spent doing it right the first time will ensure savings on expensive legal fees after the fact.

Lorne MacLean

MacLean Family Law Group Layers and Articled Students

Tags: BC child support, BC family law, BC family lawyers, BC Separation Agreements, BC spousal support advisory guidelines, British Columbia divorce, British Columbia Spousal Support, divorce lawyers, Fort St. John family law, MacLean Family Law Group, matrimonial law litigation, non-disclosure family law, Vancouver family lawyers
Posted in Blog Articles, Child Support, Divorce Planning, General, Separation Agreements, spousal support | No Comments »

BC Case Alert-Unmarried Couples, BC Marriage Like Relationship and BC Spousal Support

Monday, April 19th, 2010

Lorne MacLean Vancouver BC Divorce lawyer

P.P.W. v. R.S.L.B., 2010 BCSC 58 – 2010/01/15
Is an interesting BC unmarried couples, BC common law and BC marriage like relationship case where the BC Supreme Court had to determine if unmarried parties lived in a “marriage like relationship” for a period of two years sufficient to justify entitlement to a spousal support award. The court viewed the evidence of separate residences, some overnights together, sexual exclusivity, vacations together, no joint bank accounts although there were financial benefits provided tithe Plaintiff as well as the dysfunctional relationship and held while the alleged “wife” wanted there to be a “marriage like relationship the Defendant alleged “husband” did not and the Court dismissed the alleged “wife’s” claim for support and property division under trust law. The Court reviewed the key cases on what needs to be proven to succeed on a common law support claim.

96] The FRA also provides the definition for spouse:
“spouse” means a person who
(a) is married to another person,
(b) except under Parts 5 and 6, lived with another person in a marriage-like relationship for a period of at least 2 years if the application under this Act is made within one year after they ceased to live together and, for the purposes of this Act, the marriage-like relationship may be between persons of the same gender,
(c) applies for an order under this Act within 2 years of the making of an order
(i) for dissolution of the person’s marriage,
(ii) for judicial separation, or
(iii) declaring the person’s marriage to be null and void, or
(d) is a former spouse for the purpose of proceedings to enforce or vary an order.
[97] The law concerning the definition of spouse under the FRA is quite settled, with Gostlin v. Kergin (1986), 3 B.C.L.R. (2d) 264 (C.A.), remaining the authority on the matter. The focus of the analysis is on the parties’ subjective intentions to live in a marriage-like relationship, looking to objective factors to assist in this determination. Absent clear evidence of the intention of the parties, no one objective factor is determinative. For the most part, each case is factually unique, and therefore must be judged on its own circumstances.
[98] In Gostlin v. Kergin, the Court of Appeal stated at 267 that upon marriage, individuals assume the support obligations contained in the FRA, and that absent marriage, these obligations should not be thrust upon individuals unless they live together for at least two years as husband and wife in a marriage-like relationship.
[99] Lambert J.A. stated at 269 that when it comes to determining whether an individual is entitled to spousal support under the FRA, it is an all-or-nothing examination:
If the relationship had the characteristics of a true marriage throughout the period of at least two years that is required by the definition of “spouse”, then the parties lived together as husband and wife and there is an entitlement to claim maintenance or support. If the relationship did not have those characteristics, there is no entitlement. And there is no middle ground where the relationship has only some of the characteristics of a true marriage with the result that there is a diminished entitlement. [Emphasis added.]
[100] Takacs v. Gallo, [1998] 9 W.W.R. 235 (B.C.C.A.), provides useful direction to a court in determining if a common-law relationship exists between the parties. Newbury J.A., for the majority, states at para. 53:
The starting point in this province for the analysis required in cases of this kind is the judgment of this court in Gostlin v. Kergin (1986) 3 B.C.L.R. (2d) 264, and in particular, the comments of Lambert J.A. at 267-8 which are quoted in Madam Justice Huddart’s judgment. I read those comments as focusing first on the intentions of the parties to live “as husband and wife”, or in a marriage-like relationship. Such an intention may or may not include financial dependence. The various “objective indicators” referred to in Gostlin were advanced as a means of divining those subjective intentions where the latter “prove elusive”. By the same token, of course, subjective or conscious intentions may be overtaken by conduct such that whilst a person living with another might not say he or she was living in a marriage-like relationship, the reality is that the relationship has become such. [Emphasis added.]
And continued at para 55:
In both Gostlin and Fitton, the question of whether persons were living together as spouses notwithstanding that they were not legally married involved the court in an examination of their intentions and not simply an objective assessment of whether their financial and living arrangements were “intertwined”. If the Legislature had intended the latter, it would have been an easy matter to so state. Objective factors will of course be relevant to determine the parties’ intentions as Lambert J.A. noted in Gostlin but those factors will rarely be determinative in and of themselves. Many combinations of people may live together and meet many of the criteria set forth in Molodowich v. Penttinen (1980) 17 R.F.L. (2d) 376 (Ont. Dist. Ct.), but without intending or in fact entering the kind of psychological and emotional union that one associates with marriage. [Emphasis added.]
[101] Thompson v. Floyd, 2001 BCCA 78, is often cited for confirming that despite the change in the wording of the definition of spouse under the FRA, the Gostlin inquiry remains the authority and that other cases are helpful in determining whether a spousal relationship exists, but each case must be judged on its own facts.
[102] This is the legal framework often employed in determining the existence or not of a common-law relationship under the FRA.
[103] In order to establish an entitlement, the plaintiff must prove that she and the defendant lived together in a marriage-like relationship for a period of at least two years prior to the commencement of her claim.

We recommend you contact us immediately if you are considering entering into a marriage like relatiuonship or are in one that is breaking down as there is a1 year time limit to apply for relief.

Tags: BC spousal support, BC spousal support advisory guidelines, British Columbia Spousal Support, MacLean Family Law Group, matrimonial law litigation, retroactive awards, Vancouver family lawyers
Posted in Blog Articles, Common Law and Same Sex, Division of Property, Separation Agreements, spousal support | No Comments »

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

Tags: BC child custody, BC child support, BC family asset division, BC family lawyers, BC shared custody, British Columbia Spousal Support, Fort St. John family law, Lorne N. MacLean, MacLean Family Law Group, matrimonial law litigation
Posted in Blog Articles, Child Support, Custody and Access, Division of Property, Divorce Planning, Procedure, Separation Agreements, spousal support | No Comments »

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

Sunday, April 11th, 2010

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.

Jaqua Page

Tags: BC child support, BC Court of Appeal, BC family asset division, BC family law, BC family lawyers, BC shared custody, BC spousal support, BC spousal support advisory guidelines, British Columbia Spousal Support, MacLean Family Law Group, matrimonial law litigation, Spousal Support Advisory Guidelines, Vancouver family lawyers
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BC DIVORCE AND VANCOUVER FAMILY LAW LAWYERS MANAGING PARTNER LORNE MACLEAN AND ASSOCIATE JUSTIN WERB

Wednesday, February 3rd, 2010

Tags: Add new tag, BC child custody, BC child support, BC CHild Support Advisort Guidelines, BC family asset division, BC family law, BC family lawyers, BC spousal support advisory guidelines, British Columbia Spousal Support, Fort St. John family law, Lorne N. MacLean, MacLean Family Law Group, matrimonial law litigation, Vancouver family lawyers
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SMART BC DIVORCE TIPS # 6 WINNING BC SPOUSAL SUPPORT AND BC SPOUSAL SUPPORT ADVISORY GUIDELINES VIDEO RELEASED

Wednesday, February 3rd, 2010

BC Spousal Support and the applicability of the Spousal Support Advisory Guidelines for separated spouses is a complex and highly contentious area. Lorne MacLean BC Family Law and BC Divorce Lawyer provides crucial tips to help you avoid common BC spousal support and BC Spousal Support Advisory Guideline mistakes. Do not waive BC spousal support and maintenance or fail to consider the Spousal Support Advisory Guidelines on quantum and duration of support, on the with and without child support formula, on attributed income in disputed spousal support cases, on shared and split custody and on what happens when one party remarries or repartners.

WATCH THE WINNING BC SPOUSAL SUPPORT VIDEO BY CLICKING HERE

Tags: BC family law, BC family lawyers, BC spousal support advisory guidelines, British Columbia Spousal Support, Fort St. John family law, MacLean Family Law Group, matrimonial law litigation, Spousal Support Advisory Guidelines, SSAG, Vancouver family lawyers, with child support formula, without child support formula
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Smart BC Divorce Tip #3 – Protect Yourself At All Times

Thursday, January 21st, 2010

Lorne MacLean, Vancouver BC Family Law Lawyer, at the MacLean Family Law Group is delighted to announce Smart BC Divorce Tips # 3 is now available at our youtube channel called Protect Yourself at All Times-Winning the Financial Aspects of your Divorce and Family Law Case has just been released to positive reviews. These tips are critical if you are involved in a BC Divorce, BC Child custody, BC Child Support, BC Spousal Support and BC Family Asset Division case.

Step 1 – Obtain Proof of all assets and Debts and All Income and Expenses

Copy tax returns, credit card statements, bills, business information and anything that might help you determine how much money you will need to live on and what marital assets you are entitled to. Go through the garbage or install spyware on a computer, if necessary. Tax returns don’t always show the real income to be used for your case so make copies of all company financial documents as well. Store these documents away from the Home and redirect your sensitive mail to a safe location.

Protect Your Money and Assets

Take half of the money from a joint account, and put it in your own name. If your spouse tries to clean out the account, you won’t be able to access that money until a judge says so. This way, you will have access to money, but make sure that you keep a record of how you spend it and this is not an excuse to try to get rid of or hide assets, so act honestly. Consider a restraining order to freeze assets, closing joint credit card accounts and lines of credit to prevent them being run up by your soon to be ex-spouse.

Be Patient

With joint marital assets like homes and stocks probably worth much less than they were a few years ago, some couples are agreeing to stay together until the financial tide turns. If a moneyed husband pushes for divorce because the economy makes it less expensive for him to cash out now, press him for an upside by asking for a bonus for giving up access to a potential gain or by remaining in as a joint owner of the asset.

Lorne MacLean High Net Worth Divorce Lawyer

Tags: BC child custody, BC child support, BC Court of Appeal, BC family asset division, BC family law, BC family lawyers, BC shared custody, BC spousal support advisory guidelines, British Columbia, British Columbia divorce, British Columbia Spousal Support, divorce lawyers, Lorne N. MacLean, matrimonial breakdown, matrimonial law litigation, non-disclosure family law, Spousal Support Advisory Guidelines, SSAG, Vancouver family lawyers, with child support formula, without child support formula
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Smart BC Divorce Tips #2 – Winning your Divorce Case by Putting your Best Foot Foward

Tuesday, January 19th, 2010

Today’s Smart BC Divorce Tips #2 video from the BC Divorce and BC high net worth family law firm of MacLean Family Law Group points out a successful strategy to be used to help win their BC Divorce and BC Family Law Child Custody, Child Support, Spousal Support, and Property Division Case.

One of the most important things Lorne MacLean tells his clients when they first retain his law firm is that it is imperative that they do not write or say anything that they would not be proud to have the judge hearing their case know about because rest assured that judge will.

Click Here to see video -> Smart BC Divorce Tips #2

Tags: Add new tag, BC child custody, BC child support, BC family law, BC family lawyers, BC shared custody, BC spousal support, British Columbia divorce, British Columbia Spousal Support, Fort St. John family law, Lorne N. MacLean, MacLean Family Law Group, matrimonial law litigation, Vancouver family lawyers
Posted in Blog Articles, Child Support, Common Law and Same Sex, Custody and Access, Division of Property, Divorce Planning, General, Home | No Comments »

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