Aug 25, 2023
When your spouse passes away, you often have way too much on your plate to worry about money. However, once the time comes to deal with your finances, it is important to know what options you have available under current Ontario legislation.
If your spouse had a valid Will when they passed away, you can easily collect your entitlement. However, if for some reason this is not what you were hoping for, rather than challenging the Will or going through the trouble of a dependant support claim, you can choose to use the Family Law Act (FLA) to your benefit.
Under s.6 of the FLA, surviving spouses have the right to choose between their entitlements under the Will, or claiming an ‘equalization payment’ as if they were getting a divorce. This is called spousal election.
Now, determining the value of an equalization payment can be a little tricky, especially once tax implications become involved. Generally speaking, this payment will be comprised of the difference between each spouse’s net family property (NFP). If the deceased spouse has a higher NFP, the surviving one is entitled to that difference.
Therefore, it is in the surviving spouse’s best interest to minimize the value of their NFP as much as possible.
Deducting Disposition Costs in NFP Calculations
If there is a large asset that will be expensive to liquidate, a common issue is how to add this to the NFP. Can this asset’s value be reduced by listing the ‘capital gains’ as a liability, even if the asset is not disposed of just yet?
This was one of the issues in a 1994 Ontario Court of Appeal case called Sengmueller v. Sengmueller. Here, it was noted that tax consequences are appropriate to take into account when determining net family property amounts.
However, strict rules apply:
- “There must be satisfactory evidence of a likely disposition date of the assets.”
- “The costs of disposition will be inevitable when the owner disposes of the assets or is deemed to have disposed of them regardless of whether the asset needs to be realized to make an equalization payment.”
So, for example, if a surviving spouse is about to sell her home, ‘capital gains’ can be listed as a liability as of valuation date, regardless of whether she needs to sell the home or not. As long as there is enough evidence that the sale of the home is likely, the costs of this sale can be used to reduce her NFP.
This was more recently affirmed in Tremblay v Tremblay, where the court acknowledged that ‘disposition costs should be deducted in determining the value of an asset for equalization purposes unless it is unclear when, if ever, the value of the property will be realized.’ It was determined that ‘the value of the asset for equalization purposes is the net value after tax and other disposition costs’.
So, make sure to keep this in mind when deciding between spousal election or collecting your entitlement under the Will – sometimes tax law makes all the difference!
Colleen Dowling
Nothing contained in this post constitutes legal advice or establishes a solicitor-client relationship. If you have any questions regarding your legal rights or legal obligations, you should consult a lawyer.
Aug 17, 2023
Have you ever been given a deadline by a litigation lawyer or by the civil court? Sometimes the deadline might have a specific end date like “September 1st, 2023”; other times you may be given a number of days like “within 7 days”, and you are left having to count calendar days. This may sound pretty straight forward but is not always as easy as 1, 2, 3…
When dealing with litigation timelines, there are specific rules to follow when it comes to counting. These rules can be found at Rule 3.01 of the Rules of Civil Procedure. Keep reading for a few tips and tricks.
Where does one start?
When counting, you do not count the initial or start date, but rather, the day after. Is that confusing? Let me break it down for you. If you receive a court order dated August 14th, 2023 and are given a deadline of 3 days, then you would begin counting as of August 15th (the day after the start date), thereby making August 15th day 1, August 16th would be day 2, and August 17th would be day 3 – your deadline!
Where does one land?
When finding your deadline, you need to pay attention to the day of the week that your deadline lands on. Using the same example above, let’s change our deadline from 3 days to 5 days. Remember that our court order was dated August 14, 2023. What happens when you count 5 days according to the Rules? You land on a Saturday. The Rules state that Saturdays and Sundays are “holidays”. What happens to your deadline if it lands on a holiday? Is the deadline null and void? Absolutely not. Your deadline gets moved to the next day that is not a holiday, and in our example, that would be Monday August 21st, 2023.
What day is next?
Another important thing to note about holidays – holidays shall not be counted if you are given a deadline of 7 days or less. A complete list of other “holidays” can be found at Rule 1.03(1) of the Rules. What happens when your counting runs into a holiday? If it’s 7 days or less you skip over the holidays. Looking at the same example one more time, if you have a deadline of 7 days from August 14th, the deadline would be August 23rd. We have counted each day and skipped over the holidays, Saturday and Sunday. Remember to watch out for civic and statutory holidays which can throw off your deadlines too.
When does it end???
Deadlines of more than 7 days become a little less complicated to compute as you include all calendar days, even holidays, when counting making things a little more straightforward. The only real complication with longer deadlines (20 days, 45 days, 75 days) is you may find yourself endlessly counting days and days, giving yourself more room for error. For long deadlines, I like to use an online day counter like this one. Remember to keep in mind that although you’re not skipping holidays when counting, you still need to be mindful of a deadline landing on a holiday and move your deadline to the next day that is not a holiday.
Where does the time go?
Do you have to keep an eye on the clock? Yes! You may be thinking that you have until midnight to submit, serve or file your documents, but that would make you late on your deadline. Your second guess might be 5p.m. That is of course the usual end of business time, but again, if you submit, serve or file your documents by 5p.m. you will also be late. The deadline to serve and file is actually 4p.m. If you play the stock market, you may be comfortable with the 4p.m. deadline. So just remember you need to serve, file and trade all by 4 p.m.
Thanks for reading and happy counting.
Lucy Goytisolo
Nothing contained in this post constitutes legal advice or establishes a solicitor-client relationship. If you have any questions regarding your legal rights or legal obligations, you should consult a lawyer.
Jul 28, 2023
Reviewers noted that the team is highly regarded for its “contentious private wealth offering” and the following strengths: .
“The Casey & Moss team are smart litigators, sensible and practical.”
“Casey & Moss has great client service”
Congrats to all of the firms recognized this year!
Jul 21, 2023
When Angelique Moss and I first flirted with the idea of starting a law firm, more than one confidante questioned whether it was a good idea to go into business with a friend.
But here we are seven years later. And I can say unreservedly that it was the best decision I ever made. Since then, we got to partner with two more amazing women who are also great friends.
There have been so many upsides to partnering with friends:
- I genuinely love coming to work.
- Making decisions is so much easier when the partners have a shared set of values. For example, all four partners value environmental responsibility and our health, so we all commute by bicycle when we can. When we found an office space that had a secure indoor bike cage, a shower on our floor, and a “robing room” to store our professional clothes, we knew instantly we had found “the one”. We all value humane working hours, mentoring, access to justice, a love of the law, and humour. Decision making is smoother because we aren’t pulled in opposing directions.
- I completely trust my partners’ judgment, legal skills, and ethics.
- It eases my stress to have partners who genuinely care about me. Most lawyers I know are one major illness or family emergency away from dropping one of the balls in the air. I know that I could lean on my partners to carry me through a tough period, and I would do the same for them.
- Unlike many law firms where partners compete with each other, it is natural for us to work collaboratively for the good of the firm. We genuinely feel that a win for one of us is a win for all of us. This is the natural consequence of being actual friends.
- Early on, referrals started coming into the firm, rather than to one of us. Whoever wasn’t in court that day could call the person back. Our colleagues at other firms know that that they can refer a file to any of us or our associates without offending any internal political order.
- We have something rare and old-fashioned: loyalty.
Some early feedback made me feel like there was something unprofessional, almost juvenile, about starting a business with a bestie. Now, I wonder what is crazier: starting a law firm with a friend, or going into partnership with people you don’t genuinely like.
Angela Casey
Nothing contained in this post constitutes legal advice or establishes a solicitor-client relationship. If you have any questions regarding your legal rights or legal obligations, you should consult a lawyer.
Jul 17, 2023
Congratulations on obtaining your judgement! Now it’s time to open a bottle of champagne and grab your calculator. We’ll walk you through the process of calculating post-judgement interest with partial payment. Let’s go!
Step 1: Determine the Judgement Amount and Judgement Date
Post-Judgement Interest starts accruing automatically based on the amount owed or awarded under the judgement, beginning from the date on the order.
Step 2: Secure the Applicable Interest Rate
The interest rate may be set by the contract between the parties or by Courts of Justice Act, R.S.O 1990 c. C43. You can find the applicable interest rate by looking up the quarter when the judgement was issued through the table here, published by the Ontario Ministry of the Attorney General.
Step 3: Calculation
Let’s consider an example to demonstrate the calculation:
E.g.: The judgement was awarded to the creditor for $100,000.00 on February 1, 2023. The debtor made a partial payment of $50,000 on April 30, 2023 and is scheduled to pay the remaining balance on September 15, 2023. We need to calculate the amount due on the final payment date.
Step 3.1: Calculate Interest Period Days
First, determine the number of days for each interest period:
Period A: Judgement Date to First Payment Date
30-Apr-2023 to 01-Feb-2023 = 88 days
Period B: First Payment Date to Final Payment Date
15-Sep-2023 to 30-Apr-2023 = 138 days
Step 3.2: Calculate Post-Judgement Interest Per Diem
(Judgement Amount x Interest Rate % ) ÷ 365* = Post-Judgement Interest Per Diem
**If it is a leap year, use 366.
In the example, the interest rate in the first quarter of 2023 is 5.00, according to the table published by the Ministry of the Attorney General. We need to calculate two different interest per diem amounts as the interest must be calculated on the unpaid amount only.
For period A, the interest per diem = $100,000 x 5% ÷ 365 = $13.70
For Period B, the interest per diem = ($100,000 – $50,000) x 5% ÷ 365 = $6.85
Step 3.3: Calculate Total Post-Judgment Interest
Post-Judgement Interest Per Diem x Number of Days = Post-Judgement Interest
In this example, we need to calculate the post-judgement interest for both before and after the first payment date on April 30.
Post-judgement interest before the first payment date (Period A) = $13.70 x 88 days = $1,205.48
Post-judgement interest after the first payment date (Period B) = $6.85 x 138 days = $945.21
Period A Interest + Period B Interest = Total Post-Judgement Interest
$1,205.48+$945.21=$2,150.69
Step 3.4: Calculate Total Outstanding Balance
To calculate the total outstanding balance on the final payment date (September 15, 2023):
Total Post-Judgement Interest + Unpaid Judgement Amount = Total Outstanding Balance
$2,150.69 + ($100,000 – $50,000) = $52,150.69
Calculating post-judgement interest with partial payment may require some math, but with a few calculations, you can determine the total outstanding balance accurately. You may need to consult legal professionals or use specialized software to ensure compliance with specific jurisdictional rules.
Jennifer Jiang
Nothing contained in this post constitutes legal advice or establishes a solicitor-client relationship. If you have any questions regarding your legal rights or legal obligations, you should consult a lawyer.
