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Validity of Marriage Contracts
The Supreme Court of Canada will hear arguments on Thursday, November 6, 2003 as to whether, upon divorce, to uphold the terms of a marriage contract entered into by a couple in British Columbia, and hopefully set forth the criteria by which Courts will honour such agreements, according to Behrendt Law Chambers, an Ottawa family law lawyer.
“If the Supreme Court does not honour this agreement, it could start a multitude of lawsuits seeking to have marriage contracts invalidated,” says divorce lawyer Behrendt.
Behrendt says earlier this year the Supreme Court addressed a similar issue in Miglin v. Miglin. “In this case, one spouse tried to re-open a separation agreement to get more spousal support. In its decision, the Court made it much harder to re-open separation agreements, even if they are unfair.”
In the current case, Hartshorne v. Hartshorne, the British Columbia Court of Appeal ruled that an unbalanced marriage contract should not be followed, finding that the Vancouver couple should divide the assets nearly equally.
The couple, Robert and Kathleen Hartshorne, both represented by lawyers and both lawyers themselves, entered into a marriage contract on their wedding day in 1989 that said both parties would be separate as to property. In addition, the parties agreed that Kathleen Hartshorne could earn a 3 percent interest in the home for every year the parties remained married and cohabiting.
After the parties separated, the husband relied on the marriage contract and the wife argued that it should be set side.
The lower court agreed with the wife and declared the former matrimonial home, a vacation property, household contents, vehicles, savings and RRSPs to be family assets. The net effect of the judgment was that the wife received about 46 percent of the family assets, where she would have received about 20 percent had the trial court followed the terms of the marriage contract.
The Court of Appeal dismissed the case, leaving the lower court decision intact. In its dismissal, the majority of the court said, “What the parties view as fair at the time of executing the agreement may become unfair as the relationship evolves, and as circumstances change.”
Behrendt advises, “Courts should not interfere with private arrangements entered into voluntarily by two well-educated adults who had legal representation. Instead, the Supreme Court should follow its thinking in Miglin v. Miglin and uphold agreements, even in the face of what appears to be unfair. If the parties agree on the contract’s terms when they sign it, no person should later impose his or her judgment to suggest that the agreement is inequitable. The only persons in the parties’ shoes are the parties themselves, and no one’s judgment is better than theirs.”