Case law: Setting aside a marriage contract

Shair v Shair 2015 CarswellOnt 14332: Mr. and Mrs. Shair signed a marriage contract a month before they got married in 1996. When they separated some years later and the husband sought a divorce, the wife brought a motion to set aside the marriage contract and for equalization of family property and spousal support.

The Family Law Act, section 56, states that a court may set aside a domestic contract, which includes a marriage contract, if either party fails to disclose significant assets or liabilities, if the party seeking to have the contract set aside did not understand the nature or consequences of the contract or if there was undue influence or duress. Sections 33(1) and (4) allow a party to bring a claim for support if to not do so would result in an unconscionable outcome.

In this case, Justice Chiappetta finds the contract to be valid but also that it would result in an unconscionable outcome if the waiver of spousal support was permitted to stand. She sets that provision of the contract aside and permits the wife to make a claim for spousal support.

In deciding that the contract was valid, Justice Chiappetta notes that the wife had independent legal advice and was advised not to sign the contract by the lawyer providing the ILA. Justice Chiappetta found that while the wife’s immigration status may have been in jeopardy if the marriage did not take place, this did not amount to duress. She did not believe the wife’s evidence that she did not understand the nature and consequences of the contract because her lawyer testified that he explained this to her and that the contract was translated for her.

Justice Chiappetta found that the husband had failed to make full disclosure of his financial situation, but that such disclosure would not have had a material impact on the outcome of the marriage contract. In fact, the wife admitted that even if she had known more about the husband’s financial situation she would have signed the contract.

Because the wife would have been in a desperate financial situation without spousal support and because the husband was in a financial position to pay support, Justice Chiappetta concluded that it would result in unconscionable circumstances if the wife’s application for support were to be prevented by the marriage contract. She permitted the application to proceed under section 33(1) of the Family Law Act.

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