K vs H: Sham Agreements and Date of Separation

Rabab Buhari

March 21, 2023

Yes, this is another blog on the date of separation. This just goes to show how seriously important this is.

Okay, so facts.

The parties had two daughters. They had been married since in or around 2004. They had a separation agreement dated April 1, 2015. The Respondent’s wife wanted this separation agreement to be set aside. The Court believed that her reasons were contradictory, probably because she changed them so often. She went from saying she did not have legal advice to saying that she was misled by the legal advice and even brought a law society complaint against her lawyer. At one point, she also stated that she made the agreement to help her husband out with a business issue. The Applicant’s husband disputes this and says that the separation agreement is legit.

The April separation agreement lists July 15, 2013, as the date of separation. The Agreement detailed parenting time, decision-making responsibilities, child support, spousal support, etc. This did not make sense because the parties never stopped acting like a couple. The judge stated that he believed the agreement to be a sham because at the time,

‘Ms. H and Dr. K were not separated at the time that they signed the Agreement, did not intend to separate, nor did they intend to be governed by its terms. Nothing changed in their day-to-day life, but their tax filing status permitted Ms. H, as a separated spouse, to continue to be eligible for significant tax credits and benefits despite her husband’s dramatic increase in income after he qualified as a family physician’

The Applicant’s husband never paid support, nor did he apply for divorce. To explain this, he claims that the household account paid from the matrimonial home should be considered child support. The Court declined to do this because, on the facts, it just does not make any sense.

On December 18, 2019, the Applicant’s husband was charged with assault, and he said to the Respondent’s wife, “I divorce you” three times. This is known as “Talaq”. It is the process of initiating an Islamic divorce. After this date, the parties started to live separately and actually started to act like a separate couple. The Respondent’s wife wanted February 2020 or July 16, 2021, to be decided as the date of separation. The court stated that a date of separation does not require concurrence; only one spouse needs to form the intention to separate. The Applicant chose February 2020 because she claimed that they had gone to their Imam (spiritual leader) and had reconciled after the 2019 date. She provides the 2021 date as an alternative to when she received the introductory letter from the Applicant’s husband’s lawyer. The Court decided that the date of separation be December 18, 2019. It was what made the most sense.

It is interesting because while the court did not find the Respondent’s wife credible or reliable, the agreement still got set aside because of the circumstances of the matter. The Court outlines the difference between finding a sham agreement (which is what it did) and setting aside the contract pursuant to section 56 of the Family Law Act (which is what the Respondent’s wife was seeking). The difference is whether both parties have participated in the mischief, or one party alone bears the cost of having duped the other, respectively. Justice McGee refers to it as a difference with a distinction.

What’s the moral of the story? Do not get a separation agreement unless you are actually getting separated.
Read the case for yourself here:
2023 ONSC 303 (CanLII) | K vs H | CanLII