Separation Agreement FAQ Canada
A Separation Agreement is a contract between two parties and is therefore governed by the law of contract. The contract is binding on both parties and any failure to execute by either party may bring a claim for breach of contract. However, a court may set aside or not enforce an agreement that is unfair or unreasonable or where child support or spousal support is inadequate.
The following items may be addressed in a separation agreement:
If you are planning to separate, then a separation agreement can help you address issues on custody, maintenance and family assets instead of having to go to court to resolve such issues. In this way, you will be avoiding costly litigation fees.
In most cases courts will respect the separation agreements of spouses as long as such agreements are fair, reasonable and properly executed.
Courts are likely to refuse to recognize your separation agreement in the following situations:
This separation agreement is intended for spouses who can agree on a separation agreement and who are willing to accept such a settlement. However, if your circumstances involve complicated property distribution schemes, significant assets or complex issues related to children, it may be best to seek expert legal advice.
For the purposes of this separation agreement spouses are individuals who are legally married and who are separated or considering separation.
This separation agreement is intended for married couples only. This document may not be suitable for common-law couples.
You and your spouse should draw up another agreement canceling the separation agreement. LawDepot’s separation agreement comes with the clause “If the Husband and Wife reconcile, the terms of this Agreement will remain in effect unless the parties revoke it in writing.”
For the purposes of this separation agreement, the parent who has custody is the parent who has the care and control of the children. The custodial parent has the right to decide matters regarding the health, education and welfare of the children.
Access or visiting rights typically refers to time that the non-custodial parent gets to spend with the children.
Courts can always change custody arrangements if the arrangements do not seem to be in the best interests of the children.
If you and your spouse are both on good terms and have little problems agreeing on visitation, it may be sufficient to provide a general description of visitation (e.g. “The Wife will have reasonable and generous access.”) On the other hand, if you and your spouse have difficulties coming to agreements, it is best to clearly specify the visitation schedule. Set out the arrangement for regular visits, holiday and school visits as well as pick up and drop off schedules. Ensure that your description is clear and capable of being understood by third parties. Also, ensure that the schedule is fair and reasonable to prevent it from being challenged by the courts.
Child support refers to monetary payments that are paid on an ongoing basis for the support or maintenance of a child or children. While each parent has a legal obligation to support their children it is usually the custodial parent who incurs most of the expenses of child rearing (including providing housing, food, clothing, schooling and transportation). To offset this imbalance, the non-custodial parent is expected to contribute to their children’s expenses in the form of child support paid to the custodial parent.
Child support is typically paid in monthly installments, however, LawDepot’s separation agreement allows for weekly, bi-weekly or monthly installments.
In Canada, child support is mandated by the Federal Child Support Guidelines and the Federal Child Support Tables. The Federal Child Support Guidelines together with the Federal Child Support Tables, are a set of rules and tables for calculating the amount of support that a paying parent should contribute towards his or her children upon separation or divorce. The guidelines consider 3 factors:
The child support guidelines represent the minimum amount of child support that must be paid by the paying parent. A paying parent can always pay more than the guideline amount but only in rare situations can the paying parent pay less.
You can find out more about the child support guidelines at: http://canada.justice.gc.ca/eng/pi/sup-pen/
You can access the child support tables at: http://canada.justice.gc.ca/eng/pi/sup-pen/grl/pdftab.htm
Agreements that provide for child support less than that specified in the child support guidelines may not be recognized by the court. Furthermore, for couples wishing to divorce, such agreements will likely prevent the granting of a divorce order.
Spousal maintenance or alimony is financial support that is sometimes paid by one spouse to the other spouse when their marriage or common-law relationship breaks down. The idea behind spousal maintenance is to redistribute wealth such that one of the spouses does not face economic inequality at the end of the relationship.
Spousal maintenance is not the same as child support. Child support is a financial obligation where one parent has a duty to make payments for the support of his or her children whereas spousal maintenance refers to payments made to a spouse in order to relieve financial inequality at the end of a relationship. Children, being the responsibility of both parents are always entitled to child support whereas spousal support is usually dependent on need and ability to pay.
The law treats child support payments and spousal payments differently. Child support is not a payment that affects taxes. The payment is not deductable by the person paying child support and is not viewed as taxable income by the person receiving the payment. In contrast, spousal maintenance is usually tax deductable for the spouse that is paying and is treated as taxable income by the spouse receiving the payment.
You may want to consider the following factors when addressing spousal maintenance:
While there are no official guidelines on spousal maintenance, there is the “Spousal Support Guidelines: A Draft Proposal”. While these guidelines are not binding, courts across Canada have used the formula recommended in the guidelines. For more on these guidelines, you may wish to go to: http://justicecanada.ca/eng/dept-min/pub/ss-pae/proj/index.html
Spousal maintenance, unlike child support, is not necessarily guaranteed. It is usually dependent on the receiving spouse’s need and the paying spouse’s ability to pay. That being said, if your agreement provides for no spousal maintenance you should be extra careful before signing the agreement as it may be difficult to obtain later on should your circumstances change.
You should sit down with your spouse and discuss how you wish to divide your assets. There are several ways to divide your assets which will depend entirely on your set of circumstances. Some couples may be content to leave the relationship with property that is held solely in their name. Other couples may see such a distribution scheme as unfair and they may want to want to equalize the value of what each spouse receives instead. The most important thing to remember is to be open and honest, disclosing all assets. Below are some suggestions to help you get started:
A list of assets can be found on our Property Division Checklist.
Family assets are those assets that were used during the marriage for a family purpose. The family home, the contents of the family home (i.e. furniture) and the family car are all examples of family assets. Other assets such as RRSPs, annuities, savings accounts, pensions and contributions made to Canada Pension Plan will also be family assets if they were ordinarily used for a family purpose.
Generally, family assets and liabilities must be divided equally except when it would be unfair to do so. Parties can apply to the court if they feel that equal distribution would be unfair. Courts will generally look at a number of factors to determine whether equal distribution is unfair. These may include:
A company that is owned by one of the spouses will be a family asset if the other spouse has contributed monies to the company. However, it’s also possible for a spouse’s business to be considered a family asset even if that business doesn’t have any obvious connection with assets used by the family. The law recognizes that spouses who assume all or most of the child-rearing and homemaking duties have indirectly contributed to the business owned by the other, by allowing the other spouse the time to pursue and build up the business.
For the purposes of this agreement, extraordinary expenses may include:
Cost percentage refers to the percentage each parent will contribute to their child’s extraordinary expenses. Typically these costs are shared in proportion to each parent’s income. For example, if the mother earns $40,000 a year and the father earns $60,000 a year the father will bear 60% of the extraordinary expenses while the mother will bear 40% of the extraordinary expenses.
Yes. You MUST disclose all assets to your spouse. Your separation agreement may become invalid if you do not disclose all your assets.
Separation agreements are private contracts so they can be enforced according to contract law principles (i.e. taking the other party to court if the terms of the agreement are not complied with). Some jurisdictions also allow you to file a separation agreement with the court. Once filed, it may be possible to enforce the agreement as if it were a court order. You should consult with the court registry in your jurisdiction to determine whether your agreement can be filed.
While it is not absolutely necessary to have a lawyer review your separation agreement, it is a good idea. This is especially the case if you are confused or uncertain about any of the clauses. If you require a review, ensure that you have your agreement reviewed by your own lawyer (not your spouse’s) before you sign the agreement. Getting independent legal advice is also a good idea because it prevents parties from later saying they were at a disadvantage because they didn’t understand the agreement.
You must choose a competent adult as your witness.
You require at least two copies: one for yourself and one for your spouse. Ensure that you print copies of the agreement before you sign the agreement so that each copy will have an original signature.