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Posts from the ‘Divorce FAQs & Education Resources’ Category

Family Law Now Podcast – Episode 1: Top 10 Things You Should Know About Child Support

Episode Info

On this episode, hosted by Russell Alexander with special guest Michelle Mulchan, two family lawyers discuss everything from the basics to the complexities of child support. Tune in to Family Law Now to learn more!

Family Law Now podcast logo retro mic speach bubbleFamily Law Now

We are thrilled to launch our very own podcast series: Family Law Now. The new series delivers useful commentary and insights into timeless and trending family law issues. Family Law Now is free of charge to registered users and provides a convenient, low-commitment resource by which busy individuals who don’t have time to read long-winded articles can get answers to their legal questions, on-the-go.

Family Law Now is hosted by Russell Alexander and features a guest speaker with whom he presents a meaningful review and analysis of family law issues. With over 20 years’ experience helping families resolve their legal issues, Russell has developed a remarkable understanding of family law issues and is eager to share his jewels of wisdom with the listening public.

The podcast Family Law Now marks the culmination of a long-standing passion project and brings us one step closer to realizing our goal of democratizing access to information concerning family law matters. Tune in!

As always, please feel free to explore our articles and written commentary currently available on our blog, FamilyLLB, and online resource hub, Divorce Information Centre. The show notes are available for your reference below.


Show Notes:

Federal Child Support Advisory Guidelines (CSAG)

Screenshots included for illustrative purposes only and do not represent a complete reproduction of support tables contained in the Federal Child Support Advisory Guidelines”

child support guideline chart table for only childchild support guidelines for two children

CSAG sections (reproduced)

Section 24 – Failure to comply with court order

Where a spouse fails to comply with an order issued on the basis of an application under paragraph 22(1)(b), the court may

(a) strike out any of the spouse’s pleadings;

(b) make a contempt order against the spouse;

(c) proceed to a hearing, in the course of which it may draw an adverse inference against the spouse and impute income to that spouse in such amount as it considers appropriate; and

(d) award costs in favour of the other spouse up to an amount that fully compensates the other spouse for all costs incurred in the proceedings.

Section 19 – Imputing income

The court may impute such amount of income to a spouse as it considers appropriate in the circumstances, which circumstances include the following:

(a) the spouse is intentionally under-employed or unemployed, other than where the under-employment or unemployment is required by the needs of a child of the marriage or any child under the age of majority or by the reasonable educational or health needs of the spouse;

(b) the spouse is exempt from paying federal or provincial income tax;

(c) the spouse lives in a country that has effective rates of income tax that are significantly lower than those in Canada;

(d) it appears that income has been diverted which would affect the level of child support to be determined under these Guidelines;

(e) the spouse’s property is not reasonably utilized to generate income;

(f) the spouse has failed to provide income information when under a legal obligation to do so;

(g) the spouse unreasonably deducts expenses from income;

(h) the spouse derives a significant portion of income from dividends, capital gains or other sources that are taxed at a lower rate than employment or business income or that are exempt from tax; and

(i) the spouse is a beneficiary under a trust and is or will be in receipt of income or other benefits from the trust.

  • Reasonableness of expenses

(2) For the purpose of paragraph (1)(g), the reasonableness of an expense deduction is not solely governed by whether the deduction is permitted under the Income Tax Act.

  • SOR/2000-337, s. 5

Section 9 – Shared custody

Where a spouse exercises a right of access to, or has physical custody of, a child for not less than 40 per cent of the time over the course of a year, the amount of the child support order must be determined by taking into account

(a) the amounts set out in the applicable tables for each of the spouses;

(b) the increased costs of shared custody arrangements; and

(c) the conditions, means, needs and other circumstances of each spouse and of any child for whom support is sought.

Family Law Rules sections (reproduced)

 

Rule 23 – Evidence and Trial (excerpt or provisions relevant to ‘default hearing’)

 

Affidavit Evidence at Uncontested Trial

 

(22) At an uncontested trial, evidence by affidavit in Form 14A or Form 23C and, if applicable, Form 35.1 may be used without an order under clause 1 (7.2) (i), unless the court directs that oral evidence must be given.  O. Reg. 114/99, r. 23 (22); O. Reg. 202/01, s. 6 (5); O. Reg. 6/10, s. 8 (3); O. Reg. 69/15, s. 9 (5).

 

Rule 24 – Costs

 

SUCCESSFUL PARTY PRESUMED ENTITLED TO COSTS

 

  1. (1) There is a presumption that a successful party is entitled to the costs of a motion, enforcement, case or appeal.  O. Reg. 114/99, r. 24 (1).

 

NO PRESUMPTION IN CHILD PROTECTION CASE OR IF PARTY IS GOVERNMENT AGENCY

 

(2) The presumption does not apply in a child protection case or to a party that is a government agency.  O. Reg. 114/99, r. 24 (2); O. Reg. 544/99, s. 10 (1).

 

COURT’S DISCRETION — COSTS FOR OR AGAINST GOVERNMENT AGENCY

 

(3) The court has discretion to award costs to or against a party that is a government agency, whether it is successful or unsuccessful.  O. Reg. 114/99, r. 24 (3); O. Reg. 544/99, s. 10 (2).

 

SUCCESSFUL PARTY WHO HAS BEHAVED UNREASONABLY

 

(4) Despite subrule (1), a successful party who has behaved unreasonably during a case may be deprived of all or part of the party’s own costs or ordered to pay all or part of the unsuccessful party’s costs.  O. Reg. 114/99, r. 24 (4).

 

DECISION ON REASONABLENESS

 

(5) In deciding whether a party has behaved reasonably or unreasonably, the court shall examine,

 

(a) the party’s behaviour in relation to the issues from the time they arose, including whether the party made an offer to settle;

 

(b) the reasonableness of any offer the party made; and

 

(c) any offer the party withdrew or failed to accept.  O. Reg. 114/99, r. 24 (5).

 

DIVIDED SUCCESS

 

(6) If success in a step in a case is divided, the court may apportion costs as appropriate.  O. Reg. 114/99, r. 24 (6).

 

ABSENT OR UNPREPARED PARTY

 

(7) If a party does not appear at a step in the case, or appears but is not properly prepared to deal with the issues at that step or otherwise contributes to that step being unproductive, the court shall award costs against the party unless the court orders otherwise in the interests of justice.  O. Reg. 114/99, r. 24 (7); O. Reg. 235/16, s. 4 (1).

 

BAD FAITH

 

(8) If a party has acted in bad faith, the court shall decide costs on a full recovery basis and shall order the party to pay them immediately.  O. Reg. 114/99, r. 24 (8).

 

COSTS CAUSED BY FAULT OF LAWYER OR AGENT

 

(9) If a party’s lawyer or agent has run up costs without reasonable cause or has wasted costs, the court may, on motion or on its own initiative, after giving the lawyer or agent an opportunity to be heard,

 

(a) order that the lawyer or agent shall not charge the client fees or disbursements for work specified in the order, and order the lawyer or agent to repay money that the client has already paid toward costs;

 

(b) order the lawyer or agent to repay the client any costs that the client has been ordered to pay another party;

 

(c) order the lawyer or agent personally to pay the costs of any party; and

 

(d) order that a copy of an order under this subrule be given to the client.  O. Reg. 114/99, r. 24 (9).

 

DECIDING COSTS

 

(10) Promptly after dealing with a step in a case, the court shall, in a summary manner,

 

(a) determine who, if anyone, is entitled to costs in relation to that step and set the amount of any costs; or

 

(b) expressly reserve the decision on costs for determination at a later stage in the case. O. Reg. 298/18, s. 14.

 

(10.1) Revoked: O. Reg. 298/18, s. 14.

 

SAME

 

(11) The failure of the court to act under subrule (10) in relation to a step in a case does not prevent the court from awarding costs in relation to the step at a later stage in the case. O. Reg. 298/18, s. 14.

 

Setting Costs Amounts

 

(12) In setting the amount of costs, the court shall consider,

 

(a) the reasonableness and proportionality of each of the following factors as it relates to the importance and complexity of the issues:

 

(i) each party’s behaviour,

 

(ii) the time spent by each party,

 

(iii) any written offers to settle, including offers that do not meet the requirements of rule 18,

 

(iv) any legal fees, including the number of lawyers and their rates,

 

(v) any expert witness fees, including the number of experts and their rates,

 

(vi) any other expenses properly paid or payable; and

 

(b) any other relevant matter. O. Reg. 298/18, s. 14.

 

Supporting Materials

 

(12.1) Any claim for costs respecting fees or expenses shall be supported by documentation satisfactory to the court. O. Reg. 298/18, s. 14.

 

ORDER FOR SECURITY FOR COSTS

 

(13) A judge may, on motion, make an order for security for costs that is just, based on one or more of the following factors:

 

  1. A party ordinarily resides outside Ontario.

 

  1. A party has an order against the other party for costs that remains unpaid, in the same case or another case.

 

  1. A party is a corporation and there is good reason to believe it does not have enough assets in Ontario to pay costs.

 

  1. There is good reason to believe that the case is a waste of time or a nuisance and that the party does not have enough assets in Ontario to pay costs.

 

  1. A statute entitles the party to security for costs.  O. Reg. 114/99, r. 24 (13).

 

AMOUNT AND FORM OF SECURITY

 

(14) The judge shall determine the amount of the security, its form and the method of giving it.  O. Reg. 114/99, r. 24 (14).

 

EFFECT OF ORDER FOR SECURITY

 

(15) Until the security has been given, a party against whom there is an order for security for costs may not take any step in the case, except to appeal from the order, unless a judge orders otherwise.  O. Reg. 114/99, r. 24 (15).

 

Failure to Give Security

 

(16) If the party does not give the security as ordered and, as a result, a judge makes an order dismissing the party’s case or striking out the party’s answer or any other document filed by the party, then subrule (15) no longer applies. O. Reg. 322/13, s. 14.

 

SECURITY MAY BE CHANGED

 

(17) The amount of the security, its form and the method of giving it may be changed by order at any time.  O. Reg. 114/99, r. 24 (17).

 

PAYMENT OF EXPENSES

 

(18) The court may make an order that a party pay an amount of money to another party to cover part or all of the expenses of carrying on the case, including a lawyer’s fees. O. Reg. 418/18, s. 1.

 

Family Responsibility Office (FRO) – sections relating to Support Deduction Orders (SDO’s) and Support Deduction Order Information Forms (SDOIFs)

 

Director to enforce support deduction orders

 

20 (1) The Director shall enforce a support deduction order that is filed in the Director’s office, subject to section 7, to any change made to the support deduction order and to any alternative payment order made under section 28, until the related support order is terminated and there are no arrears owing or until the support order and support deduction order are withdrawn.  2005, c. 16, s. 9.

 

Notice of support deduction order to income sources

 

(2) The Director may serve a notice of a support deduction order to each income source from whom the Director is seeking payment, and may serve new notices when the amount to be paid under a support order changes or arrears are owing.  1996, c. 31, s. 20 (2).

 

Contents of notice

 

(3) The notice shall set out the amount of support owed by the payor under the support order and may also set out any amount in arrears under the support order and the amount required to be paid by the income source to the Director.  1996, c. 31, s. 20 (3).

 

Notice to payor

 

(4) The Director shall send to the payor a copy of every notice sent under subsection (2).  1996, c. 31, s. 20 (4).

 

Notice deemed garnishment for Family Orders and Agreements Enforcement Assistance Act (Canada)

 

(5) A notice of a support deduction order shall be deemed to be a notice of garnishment made under provincial garnishment law for the purposes of the Family Orders and Agreements Enforcement Assistance Act (Canada).  1996, c. 31, s. 20 (5).

 

Support deduction order not affected by stay of enforcement of support order

 

(6) The operation or enforcement of a support deduction order is not affected by an order staying the enforcement of the related support order unless the support order is also stayed.  1996, c. 31, s. 20 (6).

 

Contents of support order

 

9 (1) Every support order made by an Ontario court, other than a provisional order, shall state in its operative part that unless the order is withdrawn from the Director’s office, it shall be enforced by the Director and that amounts owing under the order shall be paid to the Director, who shall pay them to the person to whom they are owed.  1996, c. 31, s. 9 (1).

 

Court may require that order may not be withdrawn

 

(2) If the court considers it appropriate to do so, it may state in the operative part of the order, instead of the wording prescribed by subsection (1), that the order and the related support deduction order shall be enforced by the Director and that they cannot be withdrawn from the Director’s office.  1996, c. 31, s. 9 (2).

 

Form of support deduction order

 

11 (1) A support deduction order shall be in the form prescribed by the regulations.  1996, c. 31, s. 11 (1).

 

Information re payor, income source

 

(2) Before making a support deduction order, the court shall make such inquiries of the parties as it considers necessary to determine the names and addresses of each income source of the payor and the amounts paid to the payor by each income source and shall make such other inquiries to obtain information as may be prescribed by the regulations.  1996, c. 31, s. 11 (2).

 

Same

 

(3) If the support order is sought on consent or by way of motion for judgment or if the making of the support order is uncontested, the parties shall give the court the particulars described in subsection (2) and such other information as may be prescribed by the regulations.  1996, c. 31, s. 11 (3).

 

Completion of form, etc.

 

(4) The support deduction order shall be completed and signed by the court, or by the clerk or registrar of the court, at the time the support order is made and shall be entered in the court records promptly after it is signed, even if the support order may not have been settled or signed at that time.  1996, c. 31, s. 11 (4).

 

Divorce Information Centre – New Section

resource

Divorce Information Centre announced a new section today titled, Working With Your Divorce Lawyer. The section provides access to information including:

Online Game ‘Fortnite’ Cited in Hundreds of Divorces

Image result for fortnite

Online Game ‘Fortnite’ Cited in Hundreds of Divorces

The online video game “Fortnite” which has grossed over $1 billion in revenue since its launch in 2017 and 125 million users, has recently been discovered to have been one of the reasons that at least 200 couples in the United Kingdom have cited for divorce.

Divorce Online, a U.K. company which offers insight into divorce resources and services recently posted a blog indicating that they had noticed many of the inquires and petitions they were reviewing had mentioned the extended use of the game as a contributing factor for the couples divorce wishes. The findings also showed that these those who cited the game were for the majority from couples where one of the parties played the game, and the other did not.

 

[While we have you here, we wanted to remind you that you can get the latest articles delivered to your inbox. Sign up here.]

 

A Divorce Online spokesperson also stressed that although the game’s influences were only evident roughly 5% of the total petitions this year, there is a link between “gaming disorder” and other addictions to drugs, alcohol or gambling.  In June, the World Health Organization (WHO) had officially recognized “gaming disorder” as a mental health related issue. The disorder has shown to have negative effects on relationships due to the precedence that gaming takes to the person over other activities.

Time will tell if this is a mere blimp for couples reasons for a divorce but the popularity for “Fortnite” does not seem to be slowing down anytime soon as it currently maintains nearly 40 million players each month.

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 RussellAlexander.com

 

Federal Government Announces Proposed Changes to the Divorce Act

Image result for divorce

Federal Government Announces Proposed Changes to the Divorce Act

On May 22, 2018, the federal government tabled the proposed Bill C-78 (titled “An Act to amend the Divorce Act, the Family Orders and Agreements Enforcement Assistance Act and the Garnishment, Attachment and Pension Diversion Act and to make consequential amendments to another Act”) which would make significant changes to the Divorce Act and related legislation.

The overall intent of the Bill, which is only at first reading, is to modernize federal Family Law, by promoting faster, more cost-effect solutions to disputes.  In connection with the Divorce Act specifically, the Bill proposes to amend that legislation to enhance the protection of the “best interests of the child”, by adding new rights and obligations, namely:

  • Parenting Orders. Courts would be allowed to make “parenting orders” (instead of the current “custody orders”) allocating the exercise of parenting time and decision-making responsibility in respect of any “child of the marriage”.  Key points:
    • Only the bests interests of the child must be considered by the court, and the relevant factors will be specified in the legislation.
    • Either or both parents could apply for one, as can a non-parent (e.g. a grandparent) with the court’s permission.

 

  • Notice Obligations. A new process would be added, that requires parents who have decision-making responsibility or parenting time to give notice of an intent to change their or their child’s residence, or to relocate. Key points:
    • That notice must be given to any other person who also is entitled to exercise decision-making authority or parenting time, or who has a contact order.
    • A court may order that these notice requirements be dispensed with, but only where appropriate such as where there is a risk of family violence.
    • A person who receives such notice can apply to the court to object to the child being relocated.
    • Once again, the best interests of the child, as that assessment is informed by legislatively-specified factors, will inform the court’s decision.

The proposed Bill would make many other changes, and among the talking-points is the question of whether and how it might impact on individual rights established under the Charter of Rights and Freedoms.

Stay tuned for additional upcoming Blogs on this topic.

For the full text of Bill C-78, see:

BILL C-78, An Act to amend the Divorce Act, the Family Orders and Agreements Enforcement Assistance Act and the Garnishment, Attachment and Pension Diversion Act and to make consequential amendments to another Act

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 RussellAlexander.com

Coming Soon to a Public Library Near You:  Help for Self-Represented Family Litigants

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Coming Soon to a Public Library Near You:  Help for Self-Represented Family Litigants

The National Self-Represented Litigants Project (NSLRP) is the new recipient of $100,000 in funds from Law Foundation of Ontario, which has a mandate to improve access to justice for the people of Ontario through a variety of grants, fellowships and awards.    The funds come from the Law Foundation’s “Family Law Access to Justice Fund,” and will be used by the NSLRP to partner with local public libraries.  Together, they will work to set up a pilot program in Public Libraries to serve the needs of self-represented litigants.

The pilot program is slated to begin in July of 2018, and will run for two years.

The first to benefit from this initiative will be the Windsor Public Library and the Essex County Public Library, both of which have committed to partner in this pilot program.

Initial steps will involve: 1) hiring a Project Leader to provide training to librarians on issues related to self-represented litigants and their needs, and 2) developing public educational programming.  The latter will include legal information seminars, question-and-answer sessions with local lawyers, and clinics to educate on the forms to be used in various legal processes.

The NSLRA notes that libraries are well-poised to participate, since they are already tasked with providing the public with access to information, and frequently see patrons who seek legal advice and information in particular.

For more information about this initiative see:

https://representingyourselfcanada.com/family-law-at-the-library-new-project-to-partner-with-public-libraries/

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 RussellAlexander.com

If You are Divorced in a Foreign Country, Can a Canadian Court Make Orders Too?

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If You are Divorced in a Foreign Country, Can a Canadian Court Make Orders Too?

The facts in Cheng v. Liu are a little unusual, but the core question was this:

If a couple’s divorce is validly granted outside of Canada by a foreign court, does this preclude a Canadian court from later making any corollary orders – such as rulings on issues of support or custody – arising from that same divorce?

The husband, an engineer, was a Canadian citizen who lived in Canada.  The wife lived in China and had never been to Canada.  They got married in China in 2006 and had a daughter who lived with the wife in China her entire life.  They separated about a year after getting married, in around late 2007 or early 2008.

The wife then covered all the legal bases:  She applied in China for a divorce, and custody of their child.  She also applied in Canadian, under the federal Divorce Act, to ask for a divorce, as well as spousal support, child support, and custody.  Finally, also in Canada under the Ontario Family Law Act, she asked for equalization of net family property.

Meanwhile, the Chinese court granted the wife her divorce and awarded her sole custody of the child.  The wife’s other Ontario-based claims were still pending.

The husband, faced with all of these competing actions requiring his response, asked the Ontario court to suspend (or “stay”) the proceedings so that the entire matter could be determined in China.  This led to several rulings and some procedural wrangling, and ultimately a hearing before the Ontario Court of Appeal for its determination.

Against this complicated background the Ontario Court of Appeal had a simple question to consider:  In light of the Chinese divorce order, could a Canadian court make additional orders relating to child support, spousal support, and equalization of property?

The Court’s conclusion was mixed:  The divorce-related issues were closed for consideration, but the child support issues were still up for an Ontario Family court to rule on.

On the first point – and based on longstanding precedent that considered the provisions of the federal Divorce Act – the law states that once the foreign Chinese court had made a valid divorce order, this removes the authority of the Ontario court to hear and determine corollary matters.  So on the remaining divorce-related issues, the Ontario court had no authority.

However, the situation under the provincial Family Law Act was different:  the Ontario court could still rule on questions relating to child support, since the foreign court in China had not already done so in its divorce order.   The Family Law Act allowed child support claims to be made even after a divorce, and the foreign divorce order had no impact on that.  Indeed, the whole purpose for the Ontario legislation was to ensure that parents provide financial support for their dependent children.  Allowing the Ontario court to continuing to make orders under the Family Law Act even though the Divorce Act provisions had been trumped was actually a harmonious outcome to ensure child support would be covered.

For the full text of the decision, see:

Cheng v. Liu

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 RussellAlexander.com

 

Thinking of Doing Some Cyber-Sleuthing? Think Again

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Thinking of Doing Some Cyber-Sleuthing? Think Again

I wrote a recent Blog about the admissibility of surreptitiously-recorded telephone conversations in Family law proceedings.  I have also written several times on how courts approach the admission of Facebook evidence.

Particularly in nasty divorce and custody disputes, it is likely that courts will have to grapple with these kinds of issues regularly, given how easy its become for spouses to try to secretly gather evidence against each other, using a Smartphone, keystroke logger, spyware, etc.

But for the average embattled spouse locked in bitter litigation, how effective is this as an evidence-gathering mechanism for use in Family court?

The answer:  Not very.

Under Canadian law, secretly-gathered computer data, emails, internet history, video, audio and similar evidence is generally not admissible in routine Family law hearings, except in unusual circumstances and only after a court has held a separate mini-hearing, called a voir dire, on the specific issue.  Overall, the odds are not very good that such evidence will be admitted.

Case in point:  In a called T. (T.) v. J.(T.) the court considered a situation where the husband had hacked into his wife’s private email, using the password she had allowed him to have when the marriage was in happier times.   The emails disclosed what was, in the court’s words, “an arguably disturbing exchange between [the wife] and her lawyer, which could be interpreted as evidencing some potential risk or threat to his safety.”  Still, the court found the husband’s email hacking was not only unjustified, it was a clear violation of the wife’s privacy rights.  The court also concluded that the email evidence irrelevant and inadmissible.

Similarly, in a decision in U. (A.J.) v. U. (G.S.) the court considered whether to admit evidence that the husband had collected through the use of spyware he had illegally installed on his former wife’s laptop.  The evidence showed the wife’s activities on internet chat rooms, and established that she had engaged in extra-marital sex.  The court examined the issue in the context of the couple’s dispute over custody and access issues, ultimately concluding that the affair and the online activity was out-of-character for the wife, and was not reflective of her ability to parent the children of the marriage.  The court added that it would be “a rare case” that illegally-obtained evidence should be admitted, and only after the trial judge holds a hearing to determine its admissibility.  The burden was always on the party seeking to enter such evidence to establish “a compelling reason to do so.”

For the full text of the decisions, see:

(A.J.) v. U. (G.S.)

(T.) v. J. (T.)

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 RussellAlexander.com

 

Saving the Golden Goose: Part II – Including Specialized Professions as An Alternative Option to the Traditional Court System

Saving the Golden Goose: Part II – Including Specialized Professions as An Alternative Option to the Traditional Court System

As mentioned in our previous blog Saving the Golden Goose: Part I, a court process allows for only a rights based determination of the issues at hand. However, there are many intricacies involved in the enmeshment of family business and the process of separation and divorce. As an alternative to a purely rights based approach, other options can be considered in the collaborative approach, including:

  • Family trusts or holding companies as a method of sharing income from the family business
  • Tax planning, avoiding the possibility of triggering a Canada Revenue Agency audit
  • Considering the formation of a new family trust
  • Employment of children in the family business
  • Estate, succession, and capacity planning
  • Ensuring insurance is in place to cushion the effects of any risks
  • Gifting shares or portions of the family business to children or other family members
  • Maintaining the privacy of the family business
  • Managing the continuation of income streams
  • Splitting income amongst family members
  • Delaying equalization or sharing business payments (Ie: if and when the family business sells)
  • Preserving the family legacy for generations
  • Recognizing and predicting the ebb and flow of the market and business patterns

Unlike the court system, the collaborative process is unique in that it offers the additional benefit of involving neutral professionals who specialize in associated areas, listed above. These neutrals are able to address relevant areas of the family law matter, often with more experience in their particular field than lawyers. Neutrals are also able to complete work at their hourly rate, rather than at the lawyer’s fee. They are also able to take on some of the information gathering that would alternatively be completed by the spouses, which can be stressful. This makes including neutrals an efficient way to deal with issues in a cost effective manner.

Financial Professionals

Collaborative Financial Specialists may be accountants, financial planners, and business valuators who have expertise in helping separating families address issues relating to the family business. They play a vital role in the collaborative process by ensuring that clients provide full and frank financial disclosure. Financial disclosure includes aspects such as income, liabilities, and assets of both the spouses and the business. A business valuator may value the business and, as in the case of many self employed individuals, complete an income analysis to determine yearly income for support purposes. In the collaborative process, family business owners can work alongside the financial professional and/or business valuator to assist them in understanding the intricacies of the business based on its unique field.

Financial Specialists thoroughly vet the documents and prepare detailed reports which help to streamline settlement discussions. Financial Specialists further add value to the collaborative process by educating clients about their finances and helping to manage their expectations from a neutral perspective. This impartial stance helps to keep client expectations realistic, making negotiated settlement more likely.

Another key benefit of financial professionals is their ability to “even the playing field”. In some family matters, one spouse may have been much more involved in the finances of the family business. The other spouse may feel they are ill equipped to negotiate the finances associated with the business, and may worry about being taken advantage of by their spouse. A financial neutral can spend time separately with both parties to ensure that all the cards are on the table, and that each spouse understands the basis upon which they are negotiating.

Family Professionals

While it may not immediately seem to be a common sense approach to include a family professional within the context of a family business matter, family professionals can often deal with may of the underlying issues associated with restructuring a family and a family business. Emotions can run additionally high when dealing with the very real and salient issues associated with the individuals which make up a family business team.

Much of the concept of “Interest Based Negotiation” centers on interests that are not purely financial. A family professional can assist in identifying and bringing these interests to the table. Anger, loss and grief are a natural part of divorce or separation, especially when a family’s livelihood is on the line. A family neutral gives families access to support and guidance for managing these emotions which can intensify the conflict and derail settlement attempts in traditional divorce.

Collaborative Family Professionals are counselors, social workers, psychologists or mediators who have specialized skills in handling the emotional aspects of the issues pertaining to separation and divorce. They further discuss parenting, and help ensure that feelings, needs, and concerns are understood and respected where children concerned. This is especially pertinent when there are children working within a family business, who have their own independent concerns about how the divorce will affect their future within the business context.

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 RussellAlexander.com

Part I

Part III

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