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More on Conscience-Shocking and the Rule on Unequal Splits of NFP – There is No Rule

unequal

More on Conscience-Shocking and the Rule on Unequal Splits of NFP – There is No Rule

Recently  we reviewed  the notion of a court finding one spouse’s behaviour “shocking to the conscience” or “unconscionable”, to the point that an unequal split of Net Family Property (NFP) should be ordered.

These clearest examples included instances where one spouse racked up gambling losses, ran up debts at bars and with escort services, or took deliberate steps to conceal a large pre-separation lottery win from the other spouse.

Leaving aside these more obvious cases, the rules get a little harder to pin down for “gray-area” scenarios. Courts are not entitled to divide the spouses’ property as seems “fair”; the Ontario Family Law Act dictates that the situation must be outright “unconscionable” before an unequal division of NFP will be justified. (See the case called Berdette v. Berdette).

But it may still surprise you that even some very questionable spousal conduct does not automatically attract the court’s reproach to the point of being held “unconscionable” and justifying an unequal split of NFP under the Ontario Family Law Act.

For example, in a case called Addario v. Addario, one spouse was physically and emotionally abusive to the other, and was involved in a number of failed business ventures. Although the court found this created “inequity”, it did not rise to the level of “unconscionability” so as to justify an unequal NFP division.

On the other end of the spectrum, if a Family Court assesses a situation as unconscionable it can order an unequal split even if there is no fault-based conduct on the part of one of the spouses. For example in Serra v. Serra, the Ontario Court of Appeal found that a post-separation downturn in the Canadian textile industry, which resulted in a drop in value of the husband’s shares in what was once a profitable textile business, was a circumstance to be considered in favour of an unequal division. In that case, were the court to order a straightforward equalization of NPF, the husband would have been required to pay the wife an amount that exceeded his total net worth, which would be unconscionable.

In short, the outcome on these kinds of unequal-division of NFP cases, when contingent upon a finding of unconscionability by one spouse, depends on the particular facts. Incidentally, the person who is claiming there has been a situation of unconscionability bears the burden of establishing it; the level of success or failure in meeting that threshold will depend on the circumstances, too.

For the full text of the decisions, see:

Addario v. Addario (1989), 1988 CarswellOnt 1345 (Ont. Dist. Ct.)

See Berdette v. Berdette (1991), 3 O.R. (3d) 513, 33 R.F.L. (3d) 113, 41 E.T.R. 126, 81 D.L.R. (4th) 194 (C.A.); leave to appeal to S.C.C. refused (1991), 85 D.L.R. (4th) viii (note), 137 N.R. 358 (note), 55 O.A.C. 397 (note) (S.C.C.)

Serra v. Serra (2009), 93 O.R. (3d) 161 (Ont. C.A.)

At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at www.RussellAlexander.com.