The winners in equalization decision: lawyers

SARAH HAMPSON

From Friday's Globe and Mail

February 6, 2009 at 9:29 AM EST

The Ontario Court of Appeal's pivotal decision on Wednesday to adjust equalization payments in a time of economic turmoil may not be the break most divorcing couples think it will be, experts say.

Only one thing is certain: Family lawyers will profit as more cases head to court.

"In my opinion, a court may take into account a post-separation-date change in the value of a spouse's assets," Mr. Justice Robert Blair wrote.

The decision spared Harold Serra, a multimillionaire owner of a textile business, from having to pay his ex-wife an equalization payment of $4.1-million after his business lost as much as $9-million in value.

That payment, if he had been forced to make it, would have been about twice his current net worth, the court noted. Now, the reduced payment he owes is $900,000.

The decision sets a precedent at a time when stock portfolios and real-estate assets of many estranged couples are losing significant value because of the economic downturn.

Equalization payments in Ontario divorces have long been a source of contention, mainly because there was little anybody could do to have them adjusted.

In Ontario, the value of marital assets is calculated at a fixed time: the date of separation. In other provinces, the valuation date is flexible, and can reflect changes in economic circumstances after the couple parts ways.

Many family lawyers believe the ruling was crucial. "This was one of the top things that the courts had to fix," says Gerry Sadvari, a leading divorce lawyer at McCarthy Tétrault in Toronto.

"Anybody who separated before the summer of 2008 is going to probably be affected by the downturn, and the equalization will be higher than it would have been if calculated afterward. I and [other lawyers] have several cases where the equalization payment is greater than the remaining net worth of the individual."

But the fight for fairness won't be easy or straightforward.

A reprieve from paying a previously calculated equalization payment only comes if Ontario courts find the change in asset value "unconscionable," a term that is not the same as unfair and means it has to "be shocking to the conscience of the court," Mr. Sadvari explains.

"So, if your portfolio is down by 20 per cent, that's not even close to the test. If it's down 50 per cent that may be enough, but it will depend on other factors. If it's down 90 per cent, that's probably enough. Justice Blair was careful to say that a reduction in the value of a portfolio by itself may not qualify. ... [But] the court didn't define what kind of decline."

The decision "leaves ambiguity," says Victoria Smith, a collaborative divorce lawyer in Toronto.

"Until there's clarification or further precedent, or until the legislation is amended, it will be difficult to know where you draw the line. It will open litigation, without a doubt," she says.

Another way to put it? Lawyers, start your clocks.

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commentary by the ottawa mens centre

 

Ottawa Mens Centre.com, from Ottawa Capital of male gender apartheid, Canada wrote: This is another "feminist decision" that is, it stands to disadvantage males more than females but, you can bet, if it is a female whose assents have decreased since date of separation, the judge will engage in "the process of justification" to show why that case is an exception to the rule that will be generally applied to men. Our family court judiciary ignore principles of fairness to do what is politically correct. A typical example is child support, support payments are generally always determined from a calculation that provides the highest figure that may not be reflected by actual income.
Notice there is no decision from the Appeal court of Ontario on how FRO should allow reductions in support when income drops, no, FRO will insist on an expensive "variation" that is frequently unaffordable to a father. Judges make decisions not on law but on gender, you can see it in their orders for costs, just add up the dollar value of total costs orders against men versus costs ordered against women and the ratio is damming proof of Ontario's Male Gender Apartheid, see the roscoe research at ottawamenscentre site.

 Thanks Nancy C, This decision is of great interest to the "high flyers" the lawyers who are not real interested in a new file unless it has the makings of a 100K account. That's determined by the assets, which should be or course as a rule of thumb be over 500K.

The problem with this decision is that "justice delayed is justice denied", it has and will continue to encourage one party male or female to drag out the litigation to get revenge on the other party.

The longer the delay the more both lawyers continue to bill on the never ending costs of demanding and providing disclosure.

Often the courts apply a gender lens to the fact that one party is using the cost of litigation as a weapon to force an inequitable settlement. That is the courts make assumptions on gender while simply failing to read the documents or, simply deciding the issue on gender which frequently has nothing to do with the issues. www.OttawaMensCentre.com
 

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Ottawa Mens Centre.com, from Ottawa Capital of male gender apartheid, Canada) wrote: Anyone who thinks "things are changing" is deluded. Our Ontario Family Courts are increasingly making draconian orders that reflect a seething hatred towards men. Just walk into any Ontario Family Court and you can literally see the hatred towards men oozing out of the walls. You might as well be complaining about corruption in the worst third world justice system. It getting worse, the most vile of the Ontario Superior Court Judges make decisions to "get rid of litigants- forever", they make orders to "ban em from ever litigating again", and an order that will put them in jail repeatedly for ever without a trial, on hearsay obviously fabricated allegations, The trials are avoided, Judges like Denis Power and Allan Sheffield of Ottawa routinely flagrantly abuse their judicial discretion and issue orders doing away with trials ordered by other judges. Their decisions are obviously corrupt, to end the litigation regarding even a simple request for access by burying a father with orders for costs, security for costs, vexatious litigant orders, restraining orders all for no other purpose then to force him out of the jurisdiction or Canada. Problem is most fathers don't have another country to go to, end up sleeping under bridges or in jail totally destroyed by the most vile child abusers in society, Ontario Family Court Judges with a pathological hatred of self represented litigants and especially fathers seeking the courts assistance for access denied by a malicious mentally ill violent mother. Its not justice, its the worst crimes against children, by Judges of the Ontario Superior court and sanitized by the fembox's on the Court of Appeal of Ontario who have a chronic record of anti-father decisions. www.OttawaMensCentre.com

 

Ottawa Mens Centre.com, from Ottawa Capital of male gender apartheid, Canada) wrote: Thanks Nancy C, nicely said, This decision is of great interest to the "high flyers" the lawyers who are not real interested in a new file unless it has the makings of a 100K account. That's determined by the assets, which should be or course as a rule of thumb be over 500K.

The problem with this decision is that "justice delayed is justice denied", it has and will continue to encourage one party male or female to drag out the litigation to get revenge on the other party.

The longer the delay the more both lawyers continue to bill on the never ending costs of demanding and providing disclosure.

Often the courts apply a gender lens to the fact that one party is using the cost of litigation as a weapon to force an inequitable settlement. That is the courts make assumptions on gender while simply failing to read the documents or, simply deciding the issue on gender which frequently has nothing to do with the issues. www.OttawaMensCentre.com