CANADA Law and Practice Contributed by: Heather Hansen, Shannon Beddoe, Maureen Edwards and Victoria Lunetta, McCarthy Hansen & Company LLP
of Justice. Most financial claims are corollary to the divorce proceeding and, as such, service is personal or admitted through counsel in the case that the party has representation. There are no statutory timelines for parties deal - ing with financial proceedings. Regardless of whether the matter is negotiated or litigated, all cases start with the exchange of financial dis - closure – a process that almost always informs the pace of the negotiation and/or the litigation. The case law requires the asset-holding party to provide a value and supporting documentation for the asset(s) in question. The form and extent of disclosure depends on the nature and com - plexity of the assets. In some cases, particularly in high net worth matters, one or both parties may need to obtain the assistance of an arm’s length expert to provide an opinion of value with regard to various assets – a process that can be time-consuming and expensive. 2.3 Division of Assets Division of property is governed by provincial legislation and is individual to each province. Generally speaking, the statutory right to divi - sion of assets (which is available only to married couples) is intended to provide an equal divi - sion of the value of all assets acquired during the course of the marriage, not a redistribution of title and/or ownership. The question of value is a determination based on fact, rather than statutory definition. Value is calculated on a net basis, which can include actual liabilities and/or disposition costs and potential notional disposition costs or discounts. An example of this is when a minority discount is applied (in some circumstances) when a share - holder is in a non-control, minority position in the corporation and the value of their interest should
be discounted based on liquidity and/or ability to dispose of the interest. Financial Orders In all Canadian provinces, the statutory scheme focuses on title, meaning that marriage does not create an ownership interest in the other spouse’s assets (equitable or otherwise) and only in the case of equitable relief can a spouse obtain an equitable ownership interest in an asset. In some extreme cases, a party may obtain relief to have an asset transferred to them or to compel the sale of an asset to satisfy a payment – although this is the exception, not the rule. The courts have jurisdiction in exceptional cases to transfer assets from one spouse to the other either: • in order to secure a present or future support obligation (security for support); or • as a remedy for oppressive conduct in cases where a spouse is also a shareholder to a corporation. As in non-matrimonial cases, in exceptional circumstances the court can also seize and/or freeze assets to protect against depletion and potentially to enforce an outstanding order. Disclosure Process Canadian courts have described the failure to provide proper disclosure as the “cancer of mat - rimonial litigation”. Canadian jurisprudence deal - ing with the positive duty of a spouse to provide full and frank disclosure is robust and far-reach - ing. If a party resists disclosure that is relevant and ought to be produced, the court can restrict the party’s ability to participate in the proceed - ing and make orders in their absence, impose monetary and/or non-monetary penalties until
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