Last week,
TMZ reported that Pamela Anderson filed for divorce from her husband, Rick Salomon, just two days after he won $2.8 million
in the World Series of Poker Big One for One Drop. The couple tied the
knot this past January, meaning they were married for roughly six months.
Under California’s community property laws, Pamela likely gets half
of those winnings, but would that be the case in Ontario?
Under Ontario’s
Family Law Act’s property division regime, each spouse is entitled to one half of the value
of all property acquired during the marriage. Property division is done
via a process called equalization where each spouse calculates the value
of their assets after deducting or excluding their debts, liabilities,
and the value property they bring into the marriage. The resulting sum
for each spouse is their net family property. The spouse with the higher
amount owes the spouse with the lower amount an equalization payment of
one half the difference between them.
To avoid adding his recent poker winnings to his net family property, Rick
might attempt to claim that the money as an excludable third-party gift
under s. 4(2) of the
FLA. However, such an assertion is unlikely to hold water as numerous Ontario
cases have demonstrated that similar gambling winnings (i.e lottery prizes)
of one spouse are included in their equalization calculation. Even if
Rick has not yet received the cash, he holds a present interest in it,
which means it falls under the definition of family property inFLA s. 1(1).
Additionally, as Rick is a professional poker player, technically, the
money would most likely be considered part of his earnings under the
Income Tax Act. He would be required to include it in his financial disclosure for the
purposes of property division as it was won during the marriage. Presuming
that the couple separated at the time of the divorce filing, after Rick
won the money, then Pamela will likely be entitled to share in the $2.8 million.
However, if the couple separated prior to the Tuesday win, Pamela may be
out of luck. What property must be included in equalization calculations
is determined by a couple’s valuation date. For Pamela and Rick’s
case, their valuation date is likely to be in accordance with
FLA s. 4(1)(a): the date which a couple separates and there is no reasonable
prospect that they will resume cohabitation.
Since there are few available facts pertaining to the circumstances of
their separation, it is uncertain whether the Thursday Pamela filed divorce
papers is the date of separation. If the relationship actually ended prior
to the tournament, then it is possible that their separation pre-dates
the One Drop prize. If so, their valuation date could be one that excludes
the $2.8 million as the win would have occurred after separation. The
onus would be on Rick to prove that they separated before the game date
and that they were unlikely to resume the relationship before then.
Alternatively, if Rick is unable to exclude the prize money from his net
family property calculation through either of the above means, he might
attempt an application for unequal division to avoid splitting the money
50/50 with Pamela.
The courts have the discretion to depart from equalization and award unequal
division under a few limited scenarios outlined in
FLA s. 5(6) when a spouse can demonstrate that equal sharing would be unconscionable
in their circumstances. In this case, Rick would claim under s. 5(6)(e)
that equalization would result in Pamela receiving a disproportionately
large share of his assets given the shortness of their marriage and the
amount of time they lived together. He must satisfy the court that the
disproportionateness of an equal share in relation to the length of their
marriage is one that ‘shocks the conscience of the court’ in the
circumstances; mere unfairness, unjustness, or harshness does not rise
to the level of unconscionability.
Overall, unconscionability is a highly strenuous test to meet. Whether
Rick could succeed in such a claim depends on whether it would be equitable
in the court’s eyes for Pamela to share in the prize money given all
the relevant circumstances.