Failure to Overturn a Marriage Contract: Knight v Knight 2018 ONSC 3294
The parties were married for three years and cohabited for four years in total. They have one child together, but the wife has two children from her previous marriage.
The husband has a significant ownership interest in a major apple business. The wife brought few assets into the marriage with the exception of her pension from the Yellow Pages where she is employed.
Prior to the wedding, the husband indicated the apple company required them to enter into a marriage contract to protect his business interests. The parties retained lawyers and a marriage contract was signed which excluded all of the husband's business interests and gave the wife little in the event of a separation. The agreement protected the wife's pension and required the husband to support her children from her previous relationship should there be a separation. The parties did not take issue with the marriage contract, and the Court found it to be a valid agreement.
The husband took the position that the provision governing his obligation to pay child support for the wife's two biological children should be set aside. He cites s. 34(4) of the Family Law Act which gives the court the power to set aside a support provision if it is unconscionable in the circumstances. The wife argued that because they were divorcing under the Divorce Act and not the Family Law Act, the husband could not apply for waiver under the Family Law Act.
Because the husband was seeking to enforce other provisions of the contract, it is difficult to see why one provision would be found invalid but the others valid. It is even more difficult to understand this position when the evidence seems to support the argument that the husband stood in the place of a parent to the wife's two children.
At the time that the contract was signed, both parties had independent legal advice and initialed each page. This indicated that they had read the document thoroughly, understood it and each had guidance from a legal professional when entering into the agreement. The judge could find no evidence of duress or lack of financial disclosure that would invalidate the agreement.
Once the judge found that the marriage contract was valid and the husband was going to pay child support for his stepchildren, Justice Nelson moved onto the topic of quantum.
Interestingly, Justice Nelson says that the husband knew that the children’s biological father was paying or ought to have been paying child support when he entered into the marriage contract. The contract is silent on this matter, and does not address whether the husband’s support payments would be offset by amounts received from the biological father. As a result, Justice Nelson ordered the husband to pay child support for the full table amount owing and did not take into consideration the biological father’s contribution.
The husband's income was difficult to determine. He has annual income fluctuated and he had the ability to draw a significant income from the corporation, as well as rely on bank financing. In the end, Justice Nelson averaged his income for the previous four years beginning in 2014. With a determined income of $327,250 per year, the husband was ordered to pay $5,286.00 monthly in child support to the wife for care of all three children.