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Court Rules Two Year Limitation Period for Application to Set Aside Marriage Contract

The limitation period for an application for equalization of net family property under the Family Law Act (“FLA”) is six years from the date of separation or two years from the granting of a divorce.

In the very recent Superior Court decision of F.K. v. E.A., 2019 ONCA 3707 (CanLII), Justice Timothy Minnema ruled that an application to set aside a domestic contract that was plead in defense to an FLA and spousal support claim must be brought within two years under the Limitations Act and dismissed the FLA and spousal support claims on a motion for summary judgment.

Barring appeal, this decision has a far reaching impact for family law and estate litigation practitioners.

In F.K. v. E.A. the parties entered into a “Prenuptial Agreement” (“domestic contract”) downloaded from the internet six days before they married in 2005. They did not exchange financial disclosure and did not have independent legal advice.  In the agreement the parties waived their rights to FLA equalization and spousal support.

The parties separated in 2012. Thereafter they negotiated unsuccessfully and in 2017 the husband issued an application for equalization and spousal support. The application for equalization was issued within the six year limitation period under the FLA. There is no limitation period for a spousal support claim under the Divorce Act.

The wife referenced the domestic contract in her Answer as a defense to the FLA and spousal support claims and formally amended her Answer in 2019 to specifically plead that the husband’s claims were statute barred by reason of the two year limitation period under the Limitations Act. In response the husband sought an order setting aside the domestic contract. Thereafter the wife brought a motion for summary judgment to dismiss the husband’s claims.

Based on the submissions of counsel for the parties, the Court found that the husband’s application to set aside the domestic contract under section 56 of the FLA was a “claim” unto itself and must be brought within two years of the date of separation.

With respect to claims against estates under Part I of the FLA and Part V of the SLRA, the effect of the decision is less extreme. Unless extended, the FLA limitation is six months from the date of death and under the SLRA the limitation period for the dependents support claim is six months from the granting of probate. However, counsel seeking extensions of these time limits should be wary of the impact of this the F.K. ruling.

Notably the Court did not consider the applicability of the landmark Supreme Court of Canada of Miglin v. Miglin, [2003] 1 S.C.R. 303, 2003 SCC 24 when considering the effect of the domestic contract on the claim for spousal support under the Divorce Act.

Whether the Court was correct in deciding that an application to set aside a domestic contract is a “claim” within the meaning of the Limitations Act will no doubt be the subject of an appeal or further judicial consideration.

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