Decline in Value of Asset after Separation – Heard Case (ONCA)

Heard v. Heard (2014 ONCA 196) deals with an asset owned by one party that declined in value after separation. The question is whether the owning party should bear those losses only. Or, whether both parties should shoulder the losses, when the asset is owned by only one of them.

Facts

• The wife purchased a business investment, “LP Investment” before marriage. She was was responsible for much of its financial upkeep.
• After separation, the LP investment had monetary losses. It declined in value significantly.
• The trial judge ordered the wife to shoulder those “post separation losses”.
• The wife claims in the Court of Appeal that both the husband and wife should bear those losses equally. She argues that the losses should be accounted for in the equalization.

Issue

• Should the post separation losses for the business investment be borne solely by the wife? Or should it be equally split between the husband and wife?

Decision and Analysis 

• The Court of Appeal upheld the trial decision. They agreed that the losses after separation relating to LP Investment should be borne by the wife only:
  • The wife was the registered owner of the investment
  • She decided when it would be sold
  • She used the benefits from it for her personal gain. For example, she solely earned the related income tax benefits
  • The wife also claimed that she would purchase the husband’s interest from the home they shared during the marriage, using the income from the investment

If you have questions about losses relating to an asset after separation, call our family lawyers at 905.707.3370.