Bakhshi v Hosseinzadeh, 2007 CarswllOnt 16886
The parties entered into an Islamic marriage contract, a Maher, in Iran. After the parties were married, they immigrated to Canada. Amongst other things, the Maher contained a clause requiring the husband to pay the wife 230 gold coins upon her prompt request.
The wife commenced divorce proceedings in Ontario whereby in addition to claiming a divorce and corollary relief, she made a claim with respect to the Maher.
The trial judge ordered the husband to pay an equalization payment of $187,075 and post-separation adjustments of $44,449.93. The trial judge stated the equalization payment was “inclusive of the Maher”. Notably, the trial judge found that the value of the 230 gold coins was equivalent to $79,580. In reality, the trial judge treated the Maher obligation as separate from, or, in terms of the Family Law Act, as “Excluded” from the equalization calculation. That is, the trial judge calculated the equalization payment owing as $107,495 and then he added the $79,589 Maher payment value to the amount owing by the husband to the wife to arrive at the total payment.
The trial judge held that the value of the Maher was to be excluded from the Net Family Property calculations. As such, the trial judge treated the 230 gold coins as an additional amount owing to the wife.
The main issue before the Ontario Court of Appeal is whether the property conveyed under an Islamic marriage contract, or Maher, is excluded from the definition of Net Family Property, under section 4(2) of the Family Law Act.
The Court of Appeal explained that the trial judge’s conclusion as to the effects of the Maher on the husband’s obligations to his wife was two-fold:
- The trial judge determined that the Maher payment was enforceable;
- The trial judge determined that the Maher payment was not included in the Net Family Property
The Court of Appeal took no issue with the trial judge’s finding that the Maher payment was enforceable. However, the Court of Appeal held that the trial judge erred in applying section 4(2)(6) of the Family Law Act. Specifically, the trial judge erred by excluding the value of the Maher from the Net Family Property Calculations.
The Court of Appeal advised that a Maher should be treated like any other contract. And, like any other contract, the Maher may impose a variety of different legal obligations, the binding terms of same depend on the objective intentions of the parties as ascertained through the particular wording of the Maher when read as a whole and considered in light of its factual matrix.
The Court of Appeal noted that while section 4(2)(6) of the Family Law Act allows spouses to agree to exclude certain property from the Net Family Property calculation, there was no express agreement to that affect made in the parties’ Maher. Further, there is no basis for inferring the parties intend to exclude it”. As such, the Court of Appeal held that “absent any evidence of an objective intention at the time of the contract to treat the Maher differently, the Maher payment must be treated under the FLA like any other payment obligation between the spouses”.
The Court of Appeal held that the Maher payment must be included in the Net Family Property. The Court of Appeal explained that the Maher payment is considered an asset of the wife and a liability of the husband. That is the Maher obligation reduces the husband’s net assets by the value of the Maher payment ($79,580) and increases the wife’s net assets by $79,580. The order for equalization was varied accordingly.