by Jean Gaspich-Beaton
The Initial Consultation- With Your Lawyer
The initial consultation is much like an interview process in that you will be asked many questions, and you will provide important information needed for your lawyer to formulate and opinion and give you advice. I always tell potential client’s at our first meeting that the consultation can be thought of as an informal interview; an opportunity for them to determine if they feel comfortable with me, and an opportunity for me to gather pertinent information to offer advice to move the file forward. I like to think of my initial consultations as a “fact finding process”, a way to gather all the information so I can get familiar with you, your story, and the direction of your file.
At an initial consultation, your lawyer will likely give you an opportunity to tell a “nutshell version” of your story. This might start with a question about why you feel you need the assistance of a family lawyer, or why you are looking for advice. Based on the summary of information you provide, your lawyer will then ask you many leading questions. Some of these questions might seem irrelevant or even uncomfortable. However, your lawyer has an obligation to obtain important background information in order to determine the options available to you. For example, your lawyer might ask you if violence has ever been an issue in your relationship. While this might seem irrelevant to your inquiry about obtaining a divorce, your lawyer might be trying to determine if mediation or other collaborative options might be an option for resolving the issues.
After gathering the important information, your lawyer will discuss the subjects that directly affect you as a result of your separation. The “top 5” family law issues that most people need to address are: custody/access, child support, spousal support, equalization and the matrimonial home. These will be discussed below.
When you and your spouse separate, you and the other parent must determine where the child/children will live and how decisions will be made about them. The terms “custody” and “access” are legal terms that are often misused or misunderstood, and it is therefore important to distinguish these terms.
Custody – Custody is the term to describe how major decisions will be made about a child after parents separate. The two most common types of custody are sole custody and joint custody. Custody is not about where the child lives or who the child lives with. Custody refers to decision-making authority only.
Sole Custody – Sole custody is when one parent has the obligation to make important decisions affecting the child’s health care, education and religious upbringing. This does not mean the other parent is excluded from the child’s life. Quite the contrary, the sole custodial parent will often have an obligation to consult with the non-custodial parent and seek input before making important decisions.
Joint Custody – In a joint custody arrangement, both parents make important decisions for and about the children together. The decision regarding custody will depend largely on the specific facts of your case.
As mentioned above, custody has nothing to do with where the child lives. However, in sole custody scenarios the child will typically live with the sole custodial parent but spend regular time with the non-custodial parent. Joint custody does not necessarily mean “equal time.” For example, in a joint custody scenario it is quite reasonable for the child to live “primarily” with one parent even though the parents have joint custody and joint decision-making ability.
Parents often ask at what age are the children allowed to decide where to live on their own. People often mistakenly believe that 12 or 13 is an age when the children’s decisions are accepted. This is not correct. A child is a dependant subject to a parent’s care and supervision at least until they reach 18. As a child matures and develops, his or her thoughts and opinions should be given greater weight, but the ultimate decision should rest with the parents. Parents need to look at their family situation and decide what residential arrangements make sense for the children. Some factors to consider are:
- The ages of the children;
- How well the children adapt to change;
- How near you and your former partner live to each other;
- Your ability to communicate with each other; and
- Your willingness to be flexible.
Access is the legal term to describe the physical amount of time a parent without custody spends with his/her children. The amount of time and the specific schedule depends on what works best for everyone. Some people settle on a specific schedule that might include alternate weekends and one or two days per week. Other people opt for an “open door” parenting approach where there is no specific schedule and access is generous and liberal. The person with whom the child is with on a given day will typically be responsible for that child’s day-to-day decisions.
Child support is the financial contribution a parent pays to help provide for his or her children who are not living with him or her to help support the child/children. All parents have an obligation to support their children. The child involved and entitled to receive support can be a biological child, an adopted child, a stepchild or a child for whom an adult has acted as a parent.
Children of unmarried parents have the same rights to support from their parents as the children of married couples. In determining how much child support must be paid Family court judges use the “Child Support Guidelines.” These guidelines are available online to give you an idea of how much support you can expect to receive or how much support can expect to pay. The payor parent’s income, the number of children entitled to support and the living arrangements of children are all factors that will determine the quantum of child support to be paid.
The quantum of child support owed is based on the payor parent’s income. This means that child support is owed even if the custodial parent, or parent with whom the children primarily reside, earns more than the payor parent. It is expected that both parents will contribute financially for the care and support of the children. Therefore, child support is not negated by a reduced or lower income of the payor parent.
Child support is typically paid on the first of each and every month. Some people prefer to receive their child support payments in installments. How you choose to receive support is up to you, but it must be agreed upon with your former spouse. Child support is not negotiable, and you cannot contract out of child support.
Child support is intended to assist in providing food, shelter and clothing for the children of the relationship. Special expenses, sometimes called Section 7 or extraordinary expenses, are additional costs that will be shared by the parents. These special expenses include things such as childcare expenses, medical expenses, extra-curricular activities and expenses for college or university. These additional expenses are paid by both parents in proportion to their income. If parents earn roughly the same amount of money, the expenses will be shared equally.
Both married and unmarried couples may claim spousal support. Spouses who live together but are not married may have a right to ask for support if they have lived together for more than three years or if they have lived together for less than three years but have a child together.
The law expects adults to be self-sufficient and to look after their own needs to the best of their ability. However, during a relationship, one person sometimes spends more time looking after the home and children and gives up opportunities to become more skilled or to earn a higher income. When a relationship ends, that person is at an economic disadvantage and may claim spousal support to help him or her become financially self-sufficient or to keep from ending up in serious financial difficulty.
In making a determination of spousal support, a judge must consider many factors, including the age and health of the couple and the effect, if any, the marriage or common-law relationship had on employment opportunities. A lawyer can assist you by providing an opinion on your entitlement to receive support (or obligation to pay support), on the quantum you might expect to receive or pay and on the duration the support entitlement might last.
The Federal Government has drafted Spousal Support Advisory Guidelines, which provide a range of support amounts based on the age of the spouse receiving the support, the length of the marriage and the presence or absence of child support. These guidelines are designed to help you reach an agreement based on the amounts awarded by judges in similar cases. It is important to understand that the Spousal Support Advisory Guidelines are only guidelines and have not been legislated by the federal government, so they are not mandatory.
According to Ontario’s Family Law Act, marriage is an equal partnership. Entering a marriage means entering into an emotional partnership and a financial partnership. When a marriage ends, the partnership is over and property has to be divided. Any and all assets acquired by the marriage partnership are subject to division if the partnership fails. All assets and liabilities of the “partnership” must be divided equally.
What is “Property?”
The definition of property varies a little from province to province. For the most part, property includes all real and personal property and all interests in property. Everything that was acquired by either party between the date of marriage and the date of separation is included. The following are examples of property that is included and subject to division:
- Household contents
- Art collections/antiques
- Cottages and cabins
- Severance payments
- Stock options
- Shares in companies
- Recreational vehicles
- Sporting equipment – and on and on
A fair division of the assets of the marriage partnership is critical for both spouses to be able to move on to new, independent and financially secure lives. Both parties are obligated to disclose all assets in negotiating terms of separation. Failure to disclose significant assets could result in an agreement being set aside if the outcome would have been different had it been disclosed. Typically, both parties will complete a Financial Statement with their lawyers and disclose all assets and liabilities through this form.
What about the Debt?
All debt acquired by the family must be offset against the asset. Consider the following debt that typically exists in a given family unit:
- Judgments by creditors
- Credit cards
- Lines of credit
- Car leases
- Unpaid income tax/costs of disposition of assets (e.g. real estate commission)
- Capital gains tax
An Equalization Example
Jenny and Adam have been married for 20 years. Neither party had any assets or debts at the date of marriage. Shortly after the marriage they purchased a home jointly. Adam has worked for General Motors for the past 18 years and has a significant pension through his employer. Jenny has always worked part time and has no retirement savings. The following is a summary of each of their assets and liabilities:
- Home (1/2 of $300,000 = 150,000)
- Vehicle ($5,000)
- TFSA ($10,000)
- Home (1/2 of $300,000 = 150,000)
- Vehicles ($10,000)
- Pension ($100,000)
- TFSA ($10,000)
Jenny’s assets add up to $165,000 and Adam’s assets add up to $270,000.
They also have the following debts:
- Mortgage (1/2 of $100,000 = $50,000)
- Credit card debt ($1,000)
- Mortgage (1/2 of $100,000 = $50,000)
- Credit card debt ($8,000)
- Car loan ($6,000)
- Line of credit ($5,000)
Jenny’s debt is $51,000 and Adam’s debt is $69,000.
Jenny’s net worth is determined by adding her assets less her debt. $165,000 – $51,000 = $114,000.00
Adam’s net worth is determined by adding his assets less his debt. $270,000 – $69,000 = $201,000.
In this scenario, Adam clearly has a higher net worth than Jenny. Now we must determine the difference between the two net worth’s and divide that difference. In this scenario, Adam’s net worth of $201,000 – Jenny’s net worth of $114,000 is $87,000. $87,000 / 2 = $43,500. Therefore, Adam would owe Jenny an equalization payment of $43,500 in this particular scenario.
The equal contribution of each person to the marriage is recognized in law. The law provides that the value of any kind of property that was acquired by either spouse during the marriage and still exists at date of separation must be divided equally between the spouses. Also, any increase in the value of property owned by a spouse since the date of marriage must be shared. This is accomplished through an equalization payment, or an equalization of net family property. In the above scenario, Adam would owe Jenny an equalization payment as a result of him having a higher net worth on the date of separation.
What about unmarried couples?
The “partnership” arises upon becoming legally married in Canada. The partnership concept under the Family Law Act extends to same sex and opposite sex married couples, but it does not apply to couples who were never married. If you are living with someone without being married, people often say you are in a common law relationship or you are cohabitating.
There is no legislative requirement that property be divided for unmarried couples. Generally, couples who live together do not have the same rights as married couples to share in the value of property, including, in some cases the home they live in, unless the property is in both of their names, or they paid for it together.
The matrimonial home is a special asset that requires separate consideration from other family property. All provinces provide for a restriction on one spouse’s ability to dispose of or encumber the matrimonial home without the other spouse’s consent. This protects the value of the home for sharing at marriage breakdown.
Both spouses have the right to occupy the matrimonial home. Possession does not necessarily relate to ownership of the matrimonial home. In Ontario there is an automatic equal right to possession of the matrimonial home at the time of marriage breakdown regardless of ownership of the home. If parties can’t agree who will stay and who will leave, they may have to ask a court to make an order for exclusive possession.
Typically, the couples purchase the matrimonial home early on in their relationship and the home is usually placed in their names jointly so that one would inherit automatically if the other one died. The house is often the main asset of the family and is usually divided equally unless there is some very unusual circumstances.
Sometimes, one person will wish to remain in the home permanently. In this scenario, that person will need to purchase the other person’s interest. This is called a “buy out”, and although this is a standard practice, you often need to have all other issues sorted out before a bank will provide you with financing. For example, if you are entitled to child or spousal support, the bank will want to know you will have a consistent stream of income before allowing you to obtain a new mortgage. Likewise, if you are obligated to pay child or spousal support, the bank will want to know how much disposable income you will have available after support is paid each month.
Putting it all together
After your initial consultation, you will want to be sure that you are comfortable with your decision to move forward in resolving the issues from the breakdown of the relationship. I have had people consult with me three, four, even five times, before they make a decision. Knowledge is power and the more informed you are, the better equipped you will be to move forward feeling confident about your rights and/or obligations.
As mentioned earlier, you will also need to be confident in your lawyer. You have the right to consult with more than one lawyer to obtain information, various opinions and find a person you feel comfortable with. You need to confide in your lawyer, and therefore it is of utmost importance that you trust your lawyer.
I always advise client’s at the outset of a file that there are only two ways to receive a binding order or agreement for you and your former spouse. Firstly, you can reach an agreement with your former spouse, often through the assistance of your respective lawyers, and sign an agreement. If you are unable to reach an agreement on your own, the only other person who can impose terms upon you is a Judge in the Family Court.
The first step I take for a client is drafting an initial invitation letter to the client’s former spouse advising that I have been consulted by the client and that the client wishes to engage in negotiations with the goal of entering a separation agreement. If the former spouse responds in a reasonable amount of time and with interest in negotiating, the discussion begins. The parties can choose to engage in mediation or other collaborative options for resolving their matters, and your lawyer should advise you of these options. However, if the former spouse has no interest in negotiating, then the only option available to my client to ascertain his or her rights is through an Application to the Family Court. The Court process is not the quick solution many people assume it to be. The Court process can take months, even years in some situations. There are many different stages in a Court proceeding, and these will be discussed in a separate article.
Jean Gaspich Beaton is an Associate Lawyer in our Family Law department and she can be reached for a consultation at Lancaster, Brooks & Welch 905-641-1551.