Maher Agreements Upheld

This case is an unsuccessful appeal from a court decision arising from a six day trial.  The appellant husband and respondent wife were married on April 27, 1996 and separated on March 27, 2006, both being 61 years of age.  As there were no children of the marriage, the major issue at trial was that of equalization and resulted with an order from the trial judge that among other things, the husband pay $84,999 to the wife.  Of this amount, approximately $65,000 was for equalization and $20,000 was pursuant to the contract of Maher the parties entered into at the time of marriage.

In his appeal, the husband submits that the trial judge erred in her treatment of assets the parties had at the date of marriage.  In particular, the trial judge provided that the Maher Agreement that the parties had entered into at the time of marriage was a valid marriage contract and therefore should be enforceable as such.  Maher is a sum of money that the man agrees to pay the woman in a Muslim marriage contract.  The notion here is to provide some financial security for the wife upon the dissolution of the marriage.

In this case, the appellant husband argued if the $20,000 Maher was enforceable, then his net family property at the date of separation should be reduced by the $20,000 for the debt owing on the valuation date.  The trial judge ruled that if treated this way, the debt existed on the date of marriage and thus fell within the ambit of net family property.  Therefore, the fact that this debt existed on the date of separation had no effect on the appellant husband’s net family property.

It was further held at appeal that the terms of the Maher agreement which included “in addition and without prejudice to and not in substitution of all my obligations provided for by the laws of the land” made it clear that the Maher amount is excluded from net family property.  The appeals judge held that to be treated any other way would undermine the explicit intention of the agreement and thereby render the contract meaningless.  In further support of the latter, it was found that the $20,000 Maher falls within the meaning of s. 4(2)6 of the Family Law Act and therefore is excluded from net family property.  Section 4(2)6 Family Law Act provides that property that the spouses have agreed by a domestic contract is not to be included in the spouse’s net family property.

Therefore, it was ultimately concluded that Maher is not to be included in the calculation of net family property.  However, even if it is included, the net effect of this inclusion makes no difference to the net family property of the party owing the Maher amount.

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