Estephan v. Estephan: British Columbia Court of Appeal on Setting Aside Separation Agreements
Estephan v. Estephan is a family law case that has recently been decided by the British Columbia Court of Appeal on the issue of specifically attacking Separation Agreements.
Facts
The parties started living together in 1986, married in 1996, and separated in 2005. The parties had two children. The wife was the primary caretaker for the children throughout the marriage and the husband was a successful lawyer. The wife has serious health issues that prevented her from working on an ongoing basis.
After a mediation, the parties purportedly settled all financial and parenting issues, including the wife providing a release of spousal support in return for a lump sum. The parties had obtained independent legal advice, there was financial disclosure prior to any mediation, the husband did not hide any assets, and the wife received an unequal division of family property.
The wife then moved to overturn the Agreement through the family law courts. She also asked the court for spousal support. At trial, the crux of the issue was whether the agreement was signed in "unimpeachable circumstances."
Decision at Trial
The trial Judge found that the separation agreement was binding.
Decision on Appeal
The British Columbia Court of Appeal allowed the appeal and sent the matter back for a re-trial.
According to the British Columbia Court of Appeal, the trial Judge erred in not explicitly testing the provisions of the separation agreement as against the factors outlined in sections 15.2(4) and 15.2(6) of the Divorce Act. According to sections 15.2(4), in making an order for spousal support a court should consider the condition, means, needs, and other circumstances of each spouse including:
- The length of time the spouses cohabited;
- The functions performed by the spouses during cohabitation; and,
- Any order, agreement, or arrangement relating to support of either spouse.
Moreover, section 15.2(6) states that an order for spousal support ought to:
- Recognize economic advantages or disadvantages to the spouses arising from the marriage or the breakdown of the marriage;
- Apportion between the spouses financial consequences that arise from the care of any child of the marriage over and above any obligation for the support of any child;
- Relieve any economic hardship of the spouses arising from the marriage breakdown; and,
- Insofar as practicable, promote the economic self-sufficiency of each spouse within a reasonable period of time.
The Court further noted that the wife had a strong claim for compensatory spousal support and that such a claim needed to be analyzed in order to reach the conclusion that the agreement substantially complied with the Act. Since the record did not provide adequate details and facts for the Court of Appeal to make this assessment, the matter was sent back for a re-trial.
The decision by the British Columbia Court of Appeal is contentious as it requires trial judges to engage in a complex analysis. In this case, that analysis is complicated by the fact that the wife in this proceeding did not seem to provide the requisite information so as to allow the trial Judge to engage in this analysis.
To inquire about our services, spousal support and separation agreement, the team of family lawyers in the Greater Toronto Area can be reached at 905.707.3370.
