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DOMESTIC CONTRACTS AND SEPARATION AGREEMENTS - Prenuptial and marriage contracts - Legality and validity

Wednesday, September 02, 2020 @ 6:40 AM  

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Appeal by the husband from a decision of a motion judge determining that the husband’s plea for rescission of a marriage contract was statute barred. The parties entered into a prenuptial agreement immediately before their marriage. The contract waived any entitlement to spousal support and provided that the parties would be separate as to property. After seven years of marriage, the parties separated. The husband brought family law proceedings claiming equalization of net family property and spousal support and asked the court to set aside or rescind the marriage contract on the basis that he signed it without financial disclosure, without legal advice, under duress and under a clear power imbalance. Although the husband commenced the proceeding within the six-year limitation period for equalization claims under the Family Law Act, more than two years had elapsed since the parties separated. The motion judge found that rescission of a marriage contract constituted a claim under the Limitations Act subject to the two-year limitation period and that the husband discovered his claim two months after separation.

HELD: Appeal allowed. The fact that the Family Law Act did not provide a limitation period for an application to set aside a marriage contract under s. 56(4) was a clear legislative signal that the Limitations Act was to apply. The husband’s plea for rescission of the marriage contract was a proceeding for a declaration where no consequential relief was sought and therefore, under s. 16(1)(a) of the Limitations Act, no limitation period applied to that pleading. The husband’s claim for equalization was subject to the six-year period set out in s. 7(3)(b) of the Family Law Act, and his claim for spousal support was not subject to a limitation period, pursuant to s. 16(1)(c) of the Limitations Act.

Kyle v. Atwill, [2020] O.J. No. 3152, Ontario Court of Appeal, K.N. Feldman, D.M. Brown and B. Zarnett JJ.A., July 23, 2020. Digest No. TLD-August312020006