A recent Supreme Court of Canada case, Anderson v. Anderson 2023 SCC 13 considered the enforceability of “kitchen table domestic contracts”.
Oftentimes a couple will draw up a contract amongst themselves to govern the division of their assets, or separation-related issues, in the event of a divorce or separation. If these agreements were done without the parties consulting with a lawyer, are they actually enforceable?
In the case of Anderson v. Anderson, the parties drafted a separation agreement that would govern their division of property. Several months later, the husband argued before the court that the separation agreement was not valid, and that the parties should have a formal equalization pursuant to the applicable legislation.
The Supreme Court of Canada established that the first step is to determine whether the separation agreement was a valid and enforceable contract in accordance with the general principles of contract law. The next step is to consider whether the agreement or contract is fair and equitable, in accordance with the objectives of the governing provincial family property division legislation. In Anderson v. Anderson, the court held that the separation agreement was a valid and enforceable contract and that the contract was fair and equitable.
The Supreme Court of Canada commented that domestic agreements should be encouraged and supported by the courts, especially in the context of family law.
It is important to fully understand and be aware of the potential consequences of signing a domestic contract without independent legal advice, as these contracts may by found binding by the courts.
Thanks for reading,
Alicia Ambrus