Court awards ex-wife house because husband lied about income

The court ordered the agreement to be invalid and ordered that the wife get 100% interest in the house.
The court ordered the agreement to be invalid and ordered that the wife get 100% interest in the house. (Photo: iStock)

When it comes to family law matters, courts don’t like it when spouses are dishonest in dealings with each other as this next Court of Appeal for Ontario case demonstrates.

The spouses divorced in 2004, after twenty years of marriage and three children.

They agreed to a separation agreement in 1999, in which the ex-husband was to pay spousal support and child support in the total sum of $2,000 per month.

They decided to modify the separation agreement in 2005, because the matrimonial home was sold and another home was purchased in which only the wife and the three children would live. Though the title of the house was in the ex-wife’s name only, the separation agreement was changed to reflect that the husband owned a 50% interest in the house.

Five years later, the wife brought a court action because she found out that the husband had lied to her about his income. Though he had claimed to have made $80,000 in 2005, his income was actually $344,000 for that year.

When this matter came before the trial court in 2014, the court voiced the opinion that husband’s hiding of his actual income was “unconscionable.” Had the wife known that the husband made this “significant financial income”, she would not have signed the changed agreement in 2005.

As a result, the trial court ordered the agreement to be invalid and ordered that the wife get 100% interest in the house.

The court based its decision on the Family Law Act of Ontario, which states that “if a party failed to disclose to the other significant assets, or significant debts or other liabilities, existing when the domestic contract was made”, the court can quash the separation agreement or portions of it.

The husband was obviously not happy with the court’s decision, as he filed for an appeal, claiming the court was wrong in its decision.

The appeal court didn’t think so and agreed with the court’s finding of “unconscionability” and supported the view that the husband had “a duty to act with scrupulous care for the [wife’s] welfare and interests.” The fact that he lied to her about his income was seen as “a serious breach of that duty.”

The wife got to keep the full interest in the house.

Find a Lawyer