|

The COVID19-Family Law Property SCAM That Can Cost Spouses Hundreds of Thousands

Even during this pandemic, there are some separated or separated spouses who are trying to take advantage of the situation, and the operation of Part 1 of Ontario’s Family Law Act, to try to get ALL of their ex’s wealth. It is important for married spouses to understand how that can happen, so they can plan accordingly.

Up until COVID-19 hit, when it came to property matters, separated spouses were more concerned about what happens when assets increase significantly after separation and when those separated spouses share in that increase and when they don’t. Unfortunately, due to COVID-19, the economy is facing the opposite situation, with people’s RRSPs and other investment savings plummeting in value. Even with the Courts almost completely closed, many spouses are making legal claims to try to get ALL of what their ex has left. There may be some situations where that is the proper result, but in most, it is not. This type of action is not unique to COVID-19. It is also a concern whenever the economy takes a downturn. It was also a problem in 2008 and 2009.

To understand how his scam works, it is necessary to understand how property division works after a marriage. There is no property division for common law couples under Ontario’s Family Law Act. To briefly summarize and simplify how property division works (follow the links for a complete explanation), with some exceptions, married couples share the increase in their net worths from their date of marriage to the day they separate. That makes those two dates very important. With the possible exception of matrimonial homes, married spouses start counting how much they have, and really how much what they have is increasing in value from the date of marriage. For the purposes of property division under Ontario’s Family Law Act, they stopped considering their increase in net worth on the date they separated. But, in these troubled times, that same law means that they stop counting any decrease in network on the date of separation too.

The value of what a spouse owns before the date of marriage and after the date of separation doesn’t matter. All that matters is what the married spouses had on those two dates. That fact is what makes this scam work.

John Schuman Guide to the Basics of Ontario Family Law book cover

You can get a lot more information about Ontario Family Law issues, including a comprehensive explanation of parenting cases (parenting time and decision making), child support, spousal support, property division, and most other common family law issues by downloading this $9.99 Kindle eBook, Kobo eBook, or iBook for your iPad or iPhone or ordering it from Amazon as a paperback. But to understand how the law works precisely in your situation, it is always best to speak to a good Family Law Lawyer.

To comment on this article, or to contact John Schuman, please use the form below.

Leave a Reply

Your email address will not be published. Required fields are marked *