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Ontario Separation Agreement
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Ontario Separation Agreement
The Strength of 3 Pillars - My Personal Journey
In your search for an Ontario Separation Agreement solution, you have likely found snippets of text and heard sound bites of conflicting and confusing information about the divorce process in Ontario. Layer the confusion with terms like Financial Disclosure, Independent Legal Advice and Informed Consent and you could be feeling quite overwhelmed. My hope, with this article, is that you will come away with a clear picture of how the pieces all fit and come together for a durable, legal Separation Agreement.
In preparation to write this article, my thoughts went back to early 2007 and the start of my own Separation Agreement journey. And since so much of my experience is typical of the average Canadian couple, I thought I’d share to help you better understand how I came to be where I am today.
My recollection of this day is as fresh as if happened yesterday. What was revealed this day started in motion a series of events that seemed so totally arbitrary to me that I felt entirely powerless to control or manage.
It was a bitterly cold morning, up at 5:30am to take my middle child to figure skating practice before school. The snow crunched under my boots as I darted like a rabbit to the ice box in my driveway, known as a 2004 Vibe. I shivered as the cold air filled my lungs. After her morning skate, I dropped my daughter at school.
In the rear view mirror
To satisfy my craving for anything warm, I swung by for my morning double double en route to work, about a 50-minute commute into the city. Running late, I hoped to slide in unnoticed to our weekly management meeting.
Memories of the drive in still run like a videotape on replay in head. I recall looking into the rearview mirror and what I saw was a complete shock to me, a revelation that would ultimately change my own and my children’s lives forever. Tears were streaming down my face. Why on earth was this? I was totally unaware as to why.
How could this be? What is this, I am healthy and happy, I thought. As a family, we were blessed with 3 fabulous, healthy, intelligent children active in the community. We had some modest investments, a pension and a rental property. We enjoyed a fulfilling yet modest lifestyle. Upon reflection however, I recognized that there was something in my subconscious struggling to come to the surface.
A few months after this unexpected waterworks, my wife of 15 years, an accomplished medical professional and a great mother to our young children, announced her desire the separate.
Like most separating couples, we started off in the divorce process deeply hurt and sometimes angry or other times immensely disappointed. Yet, even with all the emotions, I was still hopeful that we could work out a fair separation agreement.
Like you are doing now, I was searching for information on filing for separation in Ontario, or some form of legal separation papers, or maybe an example Separation Agreement. I considered a number of options, including a free Separation Agreement template I found online. Not sure where to begin in completing the template document, I moved on to talking to a few family law lawyers. I was scared off by that experience, I just could not get my head around an adversarial process. Just listening to how they referred to my ex-spouse gave me the chills. Give me a break! We have children together and many happy years of great memories – not to mention many years ahead as co-parents. I just couldn’t get behind that.
What I settled on seemed like near perfection. My good friend’s wife, Catharine, was a legal secretary at a big downtown Toronto law firm. She agreed to bring home the firm’s present Separation Agreement template.
Mistake # 1
So we got busy. I remember thinking this was a no brainer. I have an experienced legal secretary working from the best legal Separation Agreement template on the planet. Also, I figured that with my many years’ experience developing and negotiating business contracts, I’d be ok – after all a Separation Agreement is a business contract between two former spouses.
We worked through a weekend, taking breaks for some wine and BBQ. By Sunday afternoon, we had pulled together a Separation Agreement masterpiece, a true thing of beauty, or at least so I thought.
Mistake # 2
On the Monday morning I took the agreement to a family therapist for her review and input. She was a well known and highly respected mental health professional often relied on by family law lawyers for advice and guidance; a trusted advisor supporting separating families who needed some assistance to work out their parenting issues. After all, once we had settled our finances, we would be co-parents for life.
I needed to be certain everything was covered in regard to the future wellbeing of our children. Wow! Her feedback was invaluable. We spent three hours revising the legal language to be more inclusive and respectful. She provided some further provisions as to how we could resolve any future parenting disputes. Great value for the time and money invested.
Mistake # 3
Feeling rather clever, relived and optimistic for the future, later that day I dropped my self-crafted, best ever Canadian Separation Agreement into our family friend and fellow hockey parent and well respected family law lawyer for the once over. After a few days, I stopped back in to see him. I ran into him in the parking lot outside his office. He had his game face on. It seemed one of his clients was being stalked by their ex-spouse and he was ensuring his client’s safe passage to their car.
He took a few minutes with me in his office. He says the agreement was as neutral and fair as it could ever be and that I should go ahead and sign it. He handed me his prepared invoice for $1,800 and off I went.
Here is where the story starts to get sticky…
My wife then retained a lawyer who proceeded to dismantle the agreement and any hope of an amicable divorce. After a few months of back and forth correspondence, we found ourselves in family court.
Sadly, too many self-crafted Separation Agreements meet the same fate, and too many families end up in family court. Make no mistake about it.
You are likely thinking that subtitling the first four paragraphs ‘Mistakes’ seems incorrect. All seem reasonable, careful and measured steps to take. Read on I will explain how these steps could have been managed better for the best of possible outcomes.
I could not help thinking ‘how on earth did we go from having a self-prepared Separation Agreement that settled all issues ready to be signed, to nearly 3 years of hell dealing with lawyers and about a dozen family court appearances, and a mountain of money wasted?’
In your search you may hear or read things like:
You need no written agreement to be considered legally separated from your spouse.
Your agreement need not be prepared and witnessed by a lawyer for it to be valid.
Your agreement need not be filed in any court for it to be valid
You don’t need financial disclosure if your spouse already knows everything.
It can be handwritten, even on a napkin!
Or you may feel:
My private information should NOT be seen by anyone.
Financial disclosure will change nothing so why do the work?
We negotiated our own deal, we don’t need an outsider poking around.
All these requirements seems like a some cash-cow for the professionals to make money.
Long before my mediation career began
My family’s painful experience unfolded long before my mediation career began, however it is what drives my passion as a mediator. It is the experience and painful learning of this journey that I use to help my clients deal with the ups and downs of divorce and to hopefully help you avoid some of the same traps we fell into with legal separation in Canada.
Parliament Hill - Nurse Molly and her book
Soon after this time I met Molly Murphy at a family law reform rally on Parliament Hill in Ottawa. Molly, a London, Ontario registered mental health nurse, wrote about her Separation Agreement experience in her book Winner Take All, which provides a critical look at separation, divorce and the courts in Ontario. After visiting 5 different lawyers, she found it distressing that not one of them was willing to provide independent legal advice on her self-crafted Separation Agreement.
I read her book in one sitting. As I turned each page, I found myself nodding with agreement. At the same time my perspective on Canada was changing. I was enlightened to the seedy underbelly of this great country’s dealing with family law.
What a Legal Separation Agreements looks like
All of the above statements and feelings may be true, at some level, on their own. Given that a separation is a far reaching arrangement and possibly the largest financial transaction you will likely make in your lifetime, I want you to be clear about the 3 Pillars. Stay with me as I explain.
Creating a mediated, legally sound, durable and properly executed separation agreement is a primary foundational step in the progression to a final divorce. The separation agreement is the enduring understanding between spouses regarding all issues. For an agreement to be legally durable it’s so very important that all decisions that take form in the separation agreement be informed decisions formulated from a complete set of facts.
The 3 Pillars that make a Separation Agreement
So let’s first understand the divorce process in Ontario. In simple terms, a divorce application is a ‘dissolution of marriage.’ It is the documentation that legally ends a marriage. The central purpose behind a Separation Agreement, on the other hand, is to create clarity and certainty around your financial and parenting issues. Your Separation Agreement does not end your marriage legally.
There are two ways to be legally separated and only one way to end a marriage. You can be separated either by court order or by a Separation Agreement, however neither legally ends your marriage.
To dissolve a marriage in Ontario, you must make a divorce application to the courts to legally end your marriage. Conversely, a divorce decree offers no protection of your assets, nor does it shield you from your spouse’s debts or establish terms around child and spousal support. To have a legally binding and durable agreement it all comes down to the 3 Pillars that support a written separation agreement.
The 1st Pillar - Full Financial Disclosure
Having full financial disclosure is fundamental to informed consent. When the disclosure is in place, you have established the first pillar of the agreement. Full financial disclosure is a precondition to the all-important financial settlement decisions. Complete financial disclosure is the bedrock upon which your financial statements are built and later supports the informed decisions crafted into a Separation Agreement. Disclosure is all about making informed decisions based on a complete set of facts. Only with full and accurate financial disclosure can there be informed consent by each of you.
The 2nd Pillar - Informed Consent
Informed consent is achieved in mediation when the parties have a voice in formulating options that address their interests and concerns. I use many conflict management and settlement tools and resources, such as New Ways for Families, the highly successful child custody and parenting dispute program, and the communication coaching program BIFF Response, which transforms hostile and angry communication into a business-like conversation.
I also network with a great roster of family and parenting experts who are prepared to come alongside should the need arise.
The objective is always to avoid going to court while negotiating your parenting plan, division of assets, support and other settlement issues. Informed consent helps to achieve this.
The 3rd Pillar - Independent Legal Advice
You may read or hear that the ‘Law’ says you must obtain independent legal advice prior to executing your agreement. This requirement is often misunderstood. It is not as though you will be arrested for signing a Separation Agreement without independent legal advice. The problem is that we live in an age where people are often not held accountable for their actions.
Ontario family court judges often set aside (nullify) Separation Agreements when a signing party claims they did not fully understand the impacts of what they were signing. This is why independent legal advice is so important to obtain.
In the future, should your spouse make a request to the courts that a particular provision or the entire Separation Agreement be overturned, a Certificate of Independent Legal Advice is assurance that your Separation Agreement will be upheld.
A Certificate of Independent Legal Advice (ILA) can only be obtained from a lawyer – not a notary, paralegal or commissioner of oath. Divorce the Smartway maintains an extensive referral roster of lawyers prepared to provide you with an ILA. Remember, it is in your mutual best interest to receive independent legal advice from your individual lawyers.
When you each receive your ILA, a Separation Agreement is presumed to be binding on the both of you.
With Financial Disclosure and a Certificate of Independent Legal Advice your Separation Agreement is now support by 3 pillars of strength.
Regularly I take separating couples through building the 3 pillars together. The separation remains amicable as couples arrive at their agreement by applying their own individual standards of reasonableness and acceptability. The outcomes they reach are based, in part, on their respect and regard for each other.
Factors that drive your costs
The two factors that drive costs in separation and divorce are complexity and conflict. If you and your spouse have separated, unlike a fine wine, your separation will not ‘improve’ with age. However, like a winemaker must work with ripe grapes, a mediator should only start mediation with couples that are ready.
From experience, we know starting too soon when conflict levels are heightened can result in costs increasing. Starting too late often means the complexity has increased.
Keep in mind, with a legal separation agreement comes peace of mind, often followed by a new ‘normal’.
In mediation, it is not my role to lead the couple in directions that they do not want to head. Here are some of the issues we often address in mediation:
Full Financial Disclosure
Actuarial Valuation of Pensions
Division of Assets
Division of Debts
Independent Legal Advice
What is full financial disclosure and why do I need to do it?
Full financial disclosure is a precondition to the all-important settlement financial decisions. Complete financial disclosure is the bedrock upon which your financial statements are built and later supports the decisions crafted into a separation agreement. Disclosure is all about making informed decisions based on a complete set of facts. Only with full and accurate financial disclosure can there be informed consent by the each of you.
The interpretation of full disclosure by our courts leaves no ambiguity about this requirement. On May 2nd, 2015, the Family Law Rules in Ontario reconfirmed and updated the disclosure requirements, and made it clear that any separation agreement may be overturned if a spouse has neglected to accurately and truthfully disclose their financial position.
All financial information for the date you separated and for the day you were married are contained in your financial statement and must be substantiated by back-up documentation. Retain, gather and organize all bank account statements, credit card statements, RRSP statements, pension and investment account statements, line of credit statements, property or business valuations, and all other substantiating documentation, and provide them to us at our request.
What about my self-crafted separation agreement?
Well you can. However, If you choose to take this route, you are walking into a costly trap. I will explain the trap later, but we will start with the problems.
When you understand a lawyer’s mindset things will seem much more clear.
Lawyers are challenging by nature – their years of school have bred this trait into them. While in some cases this works, when it comes to dealing with separation agreements, it typically results in greater conflict overall.
When you walk into a lawyer’s office with a self-crafted separation agreement, that lawyer’s mind will automatically stray to a long list of challenging questions. This is not meant to be an indictment of lawyers – they are doing their job as they see it, it is just the way most tend to deal with self-crafted separation agreements.
In fact, many won’t even offer Independent Legal Advice when dealing with a self-crafted separation agreement.
The Ontario Child Support Guidelines are published to assist separating couples in arriving at a determination on the appropriate amount of child support. Parents jointly maintain the responsibility of financially supporting their children.
Each of your incomes and the number of children are factors that influence the child support amount. The guidelines also assist in determining when child support will end. Commonly, it is when the child turns 18 years old or until they have completed their post-secondary education, however other factor must be considered and that age may differ depending on each case.
Divorce the Smartway Mediated Settlement Solution will help you apply Child Support Guidelines to arrive at an appropriate child support amount. It also addresses the other components of child support, such as the special (extraordinary) and extra-curricular child expenses.
In the applicable legislation, marriage is viewed as a financial partnership. When that partnership comes to an end neither spouse should be negatively affected more so than the other. Spousal support is one mechanism to equalize the financial circumstances resulting from the break-up of that partnership.
Spousal support terms such as how much, when, and for how long are detailed in the separation agreement.
The Spousal Support Advisory Guidelines are now a required tool for lawyers, mediators and judges across Canada. The ‘final version’ of the guidelines was released in July 2008. The guidelines require the inputting of several variables when calculating the range of spousal support and the support duration to be considered, in effect balancing how much support the receiving spouse requires to meet their needs, and how much the payer spouse can afford to pay.
The guidelines look at the length of the marriage as an indicator of the duration of the spousal support, however there are other factors considered. As a general rule, with shorter-term marriages spousal support is more about helping the receiver spouse to become financially self-sufficient. With longer-term marriages, it could be more about compensating the receiver spousal for the financial inequities created by the separation.
Here are three important provisions that every separation agreement should have with regard to spousal support:
A clear spousal support review provision clarifying how the support is adjusted, terminated or changed.
A spousal support release provision is required either way. Whether a spousal support claim is waived or not, a release provision must be included in the separation agreement. A release provision may be conditional on spousal support obligations being met in full prior to the activation of the release.
Double dip avoidance provision. A double dip is when a spouse must pay support on income from an asset already shared with their former spouse.
Your workplace pension is matrimonial property. This means that it is an asset that must be addressed in your settlement negotiations. It is an asset subject to division or equalization. How this asset ultimately gets settled it must be included in your separation agreement.
A common misunderstanding around pensions is their values. Most of us take our bank, investments or RRSP statements at face value. With this thinking, the numbers on the regular annual pension statement must be the value of the pension, right? No, the statement value is never the correct value. The reasons the statement values are not correct has filled many books about pension valuation, so I will not go into the reasons here. My advice, however, is this: never make financial decisions directly from pension statements – you will be not just a little ‘out’ but very far off of being fair and equitable.
There are also far-reaching tax impacts connected to your pension. The good news is that, in 2012, Ontario introduced some new rules that made pension valuation a whole lot less complicated and much less expensive. Let us help you with this.
The Matrimonial Home
You will need two homes going forward. If you complete your separation agreement before entering the real estate market or buying your spouse out of the matrimonial home, you will avoid many costly and stressful pitfalls. Sadly, I see too many separated spouses, feeling the pressure of our tumultuous real estate market, walk right into the some very expensive traps.
A signed separation agreement will smooth out the path to buying or selling the matrimonial home or a new home.
Couples that rush past a separation agreement can remain financially entangled far past their separation. You may be separated but to the bank you jointly signed the mortgage so you are both responsible for this debt. This can extend to your lines of credit, credit cards, and car loans. These responsibilities and other joint debts will affect your individual credit worthiness. The financial terms of the separation agreement will clear up your connecting credits and explain to the bank your obligations for equalization, child and spousal support.
Upon closing the sale of your matrimonial home, a formal separation agreement is required to instruct your real estate lawyer on how to disperse your proceeds from the sale, otherwise your equity will stay in your real estate lawyer’s trust account until a separation agreement is provided.
Dispute Resolution Provisions
A separation agreement arrived at by mutual consent and settled out of court is statistically known to be long lasting with a minimum of future conflict.
To create a durable settlement, your separation agreement will include dispute resolution provisions, illustrating the settlement procedure to be followed to self-resolve any future disagreements.
Having mutually agreed upon dispute resolution options and pathways ensures resolution of future unexpected issues without engaging lawyers or going to court.
The Parenting Plan
A parenting plan is the written legal document that outlines how you and your spouse, as co-parents, will raise your children after your separation or divorce.
The term parenting plan may sound like a less hostile phrase for a custody agreement, but parenting plans offer much more information and much more flexibility than traditional custody agreements.
These plans, which are mediated between the parents, address various aspects of child custody. You and your ex-spouse can incorporate as much or as little information into a parenting plan as you deem necessary, and you can change your plan if you find it’s no longer working for your family’s needs. The nice thing about a parenting plan is that you have complete control. You’re not stuck signing a document you don’t agree with or waiting for a judge to render a custody decision. Some families only address custody and visitation in their parenting plans, while others get into much more detail.
When you’re working on a parenting plan, and for the many years ahead you will spend dealing with your ex, keep the following in mind:
Each of you has something valuable to offer your child.
Each of you needs and deserves time with the child.
Disagreements do not mean either of you is a bad parent.
Work to constructively resolve disagreements with practical solutions rather than escalating a dispute.
Ask your ex-spouse what he or she needs, and express your needs clearly in a language that is neither confrontational nor blaming.
When you make financial, custody, and other divorce decisions, the well-being of your children should be the first thing on your mind. More than half of those children whose parents get embroiled in custody battles develop depression, but a parenting plan can help save them from such troubles down the road. Your child can rest easy, with complete security that she’ll have substantive time with both parents.
The benefits of a parenting plan:
More than anything, children crave security and consistency. A parenting plan gives them both.
Your child will always know with which parent she will be, and can plan birthdays, outings, visits with friends, and projects accordingly. She also won’t be stuck wondering when she’ll see her other parent next or if her parents will ever resolve their conflicts.
The shared parenting involved in a parenting plan is much better than fighting endlessly or trying to take all custody away from your ex.
Perhaps the most important benefit of a parenting plan is that it improves your child’s relationship with both parents. She’ll have guaranteed time with each of the people she loves most, and the open communication fostered by a parenting plan helps your child know that she’s not betraying you by loving her other parent.
Additionally, relationships don’t begin and end with parents. Your child may have grandparents, half siblings, aunts, uncles, cousins, godparents, and friends he only sees when he is with one parent.
Your parenting plan keeps these relationships – which are often vital for helping kids get through the stress of divorce – strong and intact.
Your parenting plan will minimize conflict by clearly setting out parenting guidelines and expectations; providing for your children’s needs and child support. Here are a few things that can be established in a parenting plan.
Sharing information between parents
Where the children live and scheduling on duty and off duty parenting
Access to grandparents and other relatives
Scheduling holidays and special occasions
How and when new partners will be introduced to the children
Are you struggling with the concept of full financial disclosure?
You are not alone for many it is difficult concept to grasp.
We know how challenging it is to gather, organize and provide acceptable financial disclosure documents. To alleviate some of the complexity, confusion and tiresome work we have created the DTSW Portal, an interactive learning and submission portal to help you get organized and headed in the right direction.
Our DTSW Portal ensures that your financial disclosures are correct, complete and organized, ensuring nothing is missed or lost in the shuffle, moving you forward smoothly.
All this may sound complicated to you, leave it to me. I will guide you through it in as little as time as possible. I feel it is not my role to take you in directions you do not want to go. I am here to guide you both in making your own decisions. When I started Divorce the Smartway back in 2010 I felt there was void in the market for separating couples who desired the BEST separation agreement at an affordable cost without the high conflict. Please accept my offer to join me in an Early Neutral Consultation. Tap here to Register
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When it comes to separation and divorce, you have options. Those options largely depend on your unique situation - how long you've been married, assets to be divided, and whether children are involved. Which option is best for you? A few simple questions may narrow it down.
Whatever questions you may have about separation, getting divorced, the dispute settlement process, mediators - or anything else related to an amicable equitable separation and positive ongoing co-parenting relationship - ask them here.
Getting a divorce in Ontario can be a confusing process, one that is made even more confusing when legal terms are added to the mix. To help you, we've put together this jargon-busting lexicon of some frequently used legal words and phrases.
Ken S. Maynard is an accredited divorce mediator (Acc.FM) and a Certified Divorce Financial Analyst (CDFA). He is a specialist in comprehensive divorce mediation services resulting in a separation agreement. You can meet with Ken at any of the 5 DTSW Greater Toronto mediation centres including | Aurora | Barrie | North York | Vaughan | Mississauga |
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