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Courts can level playing field for financially disadvantaged spouses

Courts across the country have extensive powers to level the playing field for financially disadvantaged spouses, Toronto family lawyer Erin Chaiton-Murray tells AdvocateDaily.com.

In a recent B.C. case, the judge ordered a woman to advance $350,000 to her husband, funded by a loan against the family home, in order to let him continue with the litigation between the two.

Chaiton-Murray, partner with Fogelman Law, says similar rulings have been seen in Ontario.

“The rules under which these cases are decided are slightly different here, but judges have the ability to make these kinds of orders in situations where a person has demonstrated need and inability to pay, and that they will essentially be unable to carry on litigation without the funds,” she says.

Still, Chaiton-Murray says the significant amount of money advanced in this case makes it “quite surprising,” although it may be explained by the circumstances surrounding the litigation.

“It’s certainly at the upper end of orders for interim distributions,” she says.

According to the decision, the couple was married in China in 2003 but separated in Canada in 2017. Having filed for divorce in China, the man’s assets were frozen by a Chinese court, leaving him without access to fund an expected custody and child support case in Canada.

Already facing steep legal bills from his Canadian lawyer, he filed for an interim distribution of family property to the tune of $350,000, arguing it would not prejudice his wife, who admitted to owning around $2 million in assets.

Still, the wife contested the motion, alleging she had no way to advance the funds, in part because she had accumulated loans of $6 million over the years to her daughter from a previous relationship.

The judge sided with the husband, finding that the wife’s alleged debts were not relevant to the claim for interim distribution.

“I find [the husband] is unable to fund this litigation unless there is an interim advance. The cost of the litigation has been, and will be, substantial. [He] has a modest income and he has no present access to his assets in China. I conclude that without an advance, he will not be able to pay his counsel what he presently owes for legal fees and disbursements and it is probable that his counsel will withdraw,” the judge concluded. “If that were to happen, [the husband] would have much difficulty retaining other counsel. He cannot realistically act for himself. Quite apart from having no familiarity with the management of a complex family law case, he is not proficient in English. The cost of translation throughout a 15-day trial would be prohibitive.”

“The court doesn’t want to see someone abandoning litigation because of a lack of funds,” Chaiton-Murray says. “It’s also interesting that the court appeared to be influenced by the possibility that the husband could continue as a self-represented litigant, which would make things more costly and time-consuming. Clearly, the court felt would be more efficient for him to be able to continue with counsel.”

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