Cancer in Family Law
When couples separate, there are two main topics to deal with: kids and money. The kid issues can be emotional. Cutting them in half is frowned on. The money issues should be simple: typically split the property 50 / 50 (another blog will discuss when unequal division happens), pay spousal and child support based on income. It’s just arithmetic.
But: the arithmetic has to start with the right information. Income for wage earners is their T-4, less union dues (if any). Conversely, business (and rental) income is not what goes on your tax return. The Guidelines claw back any “unnecessary” or “non-arms-length” payments. Entertaining clients? Back into income. Employing your new boy/girl/whatever friend? Back into income. Writing off the mortgage because you rent out the basement suite? Back into income. Doing cash work on the side? Every penny has to be declared in the court case. We have seen lots of marijuana grow-ops, commercial fishermen, people with side jobs (have ever met a firefighter who didn’t have a side gig during their “4 off”?). All of that income has to be disclosed. Judges don’t care if you paid tax on it. They just want it to be counted for purposes of spousal and child support.
Some people think that if they just refuse, or only give partial disclosure, they can evade paying fair support. Nope.
The legislation and the Court Rules require complete disclosure of finances – and all the relevant documents. You don’t have to take the other person’s word: you get to verify. There are penalties for non-disclosure.
A 1994 case: Cunha v. Cunha https://canlii.ca/t/1dn7f called non-disclosure of financial information: “the cancer of family law”. Justice Fraser ordered that all of the husband’s assets (at least all that could be discovered) be transferred to the wife. She kept all her own property. Judge Fraser ordered that the husband pay the wife’s entire legal expenses. Since 1994, Cunha has been applied hundreds of times. Always as a hammer. The new Family Law Act has fines for non-disclosure. On top of the other penalties. Lying about income can turn into a very bad no-good day.
Sometimes the non-disclosure is done by faking expenses. Claiming more fuel for a commercial fishing boat than it could burn? Claiming the cost of hookers and cocaine as “office supplies”? Forging receipts? We’ve seen them all.
You want lawyers who can see through the fog, clearly.
We are putting on a Wills seminar: Will Power by Zoom on 12 May. Register here: https://www.clearlaw.ca/register
