Canadian Press Article:
OTTAWA — The country’s highest court has topped up a $1-million divorce settlement with an extra $649,000 for a British Columbia woman who complained her former husband hid assets and took advantage of her fragile mental health in negotiating a settlement.
In a 7-0 judgment Thursday, the Supreme Court of Canada effectively rewrote the original deal signed by Nancy Rick when her 28-year marriage to Ben Brandsema foundered in 2001.
Justice Rosalie Abella, writing for her unanimous colleagues, noted the court has ruled in the past that judges shouldn’t lightly interfere in settlements worked out between divorcing spouses.
“Parties should be free to decide for themselves what bargains they are prepared to make,” said Abella. But she went on to add that “this contractual autonomy depends on the integrity of the bargaining process.”
In this case, Abella concluded, there was ample evidence the two sides weren’t playing on a level field.
Jack Hittrich, the lawyer for Rick, welcomed the judgment as a “resounding victory” for his client but said it will have repercussions beyond her case.
“The underlying message for divorcing couples is that if a party is not coming to the table with clean hands there are going to be consequences,” said Hittrich.
“If parties negotiate fairly they have nothing to worry about.”
Rick and Brandsema reached a deal when they split up that gave the wife a house and cash payments worth just over $1 million, while the husband kept control of the family dairy farm and other lucrative property.
The aim was supposed to be to divide the family assets equally. But two years later Rick went to court to claim that Brandsema had misled her on the value of some of his holdings and had failed to disclose others at all.
She also maintained he exploited her emotional problems, including a history of depression, anxiety and post-traumatic stress arising from a troubled childhood and aggravated by a difficult marriage.
Brandsema’s lawyers argued Rick had exaggerated her mental health problems and had deliberately schemed to take the original $1 million and then go back to sue for more.
They also maintained that, when the tax implications of the settlement were taken into account for Brandsema, the deal worked out to a roughly equal division of assets.
A trial judge ruled Rick’s favour, concluding she was a “troubled woman” who had difficulty grasping the legal advice she go and the mediation process that led to the original deal.
The judge also found that Brandsema had taken advantage of her mental state and had failed to make full disclosure of his assets.
The B.C. Court of Appeal reversed those findings, stating that despite her mental troubles Rick “knew what she was doing,” and Brandsema had no obligation to tell her she wasn’t asking for enough.
The dispute renewed long-standing questions about when a negotiated divorce or separation agreement should be treated as final and when the courts should intervene. The issue has wide-ranging implications, since an estimated 90 per cent of divorces entail so-called amicable settlements rather than court-imposed orders on division of assets.
The Supreme Court, in a landmark 2003 judgment, stated that judges should be reluctant to interfere in most negotiated settlements. But it left the door open for intervention in exceptional circumstances – including cases where assets were hidden or the “vulnerability” of one partner was exploited by the other.
Abella said the B.C. appeal court misinterpreted some principles flowing from the 2003 ruling, while the trial judge got them right. She accepted his findings and endorsed his calculation of $649,000 as the appropriate add-on to Rick’s settlement.
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