Car Lease Payments and Financial Disclosure

In order for separating spouses to commence the negotiation process in Family Law, they must exchange financial statements and make full financial disclosure.

In cases such as Naidoo v. Naidoo and Sharman v. Sharman, the Court dealt with the issue of whether a party was justified in listing future car lease payments as a debt in their financial statement.

The Court in Naidoo, the leading case on the issue, ruled that because the car lease payments had not yet become due, rather they were merely a future debt, the party was not permitted to list the future car lease payment as a debt on his financial statement.

The Court in Sharman v. Sharman reiterated the ruling of Justice Howden in Naidoo, and stated as follows:

“At the time of separation, the wife still owed about $5000 on her car lease. The amounts were to be paid monthly. In fact, she paid the amounts, and returned the vehicle at the end of the lease, as she was entitled to do. I do not have the accounting evidence that Howden J. had in Naidoo v. Naidoo, [2004] O.J. No. 1458 (Ont. S.C.J.), but it seems to me that although the wife obliged herself before the separation to make these monthly payments, they were not due or collectable until after the separation. Accordingly I do not include them in the wife's debts.”

To learn more about car lease payments and financial disclosure as well as the services provided by Krol & Krol, call 905.707.3370 today.