A recent Ontario decision awarded a wife $200,000 in interim disbursements to cover the costs of litigation in her divorce proceedings from her husband.
What Happened?
The couple married on October 29, 2010, after having cohabited for over four years. They disagree on the date of separation. Depending on the date used, they were married for six or seven years before they separated.
The marriage was a second marriage for both parties. The wife is 62 years old and in poor health. The husband is 84 years old.
The husband is very wealthy, and was at the time the parties married. He conducted estates freezes before meeting the wife and before marrying her.
A 2018 court order had awarded the wife $54,000 per month in temporary spousal support. In addition, the husband was paying up to $28,000 a month to cover the wife’s costs for a personal care assistant, due to her ill-health.
However, the couple were still litigating issues of final spousal support and equalization. The litigation between the parties had been high-conflict and expensive.
The wife sought $425,000 in interim disbursements. Of this, she asked for $50,000 for legal fees and $375,000 for a forensic analysis of the husband’s income and financial circumstances, and for the preparation of two reports: an income report and a valuation report.
Issues
The issue was whether the wife was entitled to an order for interim disbursements, and if so, in what amount.
What is an “Interim Disbursement”?
The court explained that Rule 24(18) of the Family Law Rules allows the court to “make an order that a party pay an amount of money to another party to cover part or all of the expenses of carrying on the case, including a lawyer’s fees”. The court stated that the purpose of an order for interim disbursement is to ensure the just determination of the issues between the parties, which recognizes that there may be circumstances where one party cannot afford to seek justice on meritorious claims given the disparity in financial resources available to that party.
On a motion seeking interim disbursements, the court explained that the moving party must demonstrate:
1. The interim disbursements for which an advance payment is requested are important to matters in issue in the proceeding as a whole;
2. The disbursements are necessary and reasonable given the needs of the case and the funds available. If the disbursements are for payment of an expert, the moving party must demonstrate a clear need for the services of the expert;
3. The moving party is incapable of funding the requested amounts;
4. The claim or claims being advanced in the case must be meritorious as far as can be determined on the balance of probabilities at the time of the request for disbursements; and
5. The imposition of the payment on the responding party will not cause undue hardship to the payor.
It is not necessary for a court to find exceptional circumstances to order interim disbursements under the Family Law Rules. The order is a discretionary one. The court must ensure the primary objective of fairness under the Family Law Rules is met.
Parties’ Positions
The wife sought disbursements for legal fees and expert fees.
The husband disputed the reasonableness and necessity of the expert’s fees.
Decision
The court found that the reality of the parties’ litigation was such that disbursements for legal fees and expert fees were important to matters at issue in the proceeding as a whole. Additionally, the wife could not fund the costs herself.
After reviewing the facts, the court ordered that the husband pay to the wife, within thirty days, the amount of $200,000 in interim fees and disbursements.
Get Advice
Separation and divorce are challenging for everyone involved. When dealing with custody or access disputes, matters involving spousal and child support, the division of assets, and other family issues, emotions can be your worst enemy. Having an experienced family lawyer on your side can help you stay focused and resolve disputes as quickly and amicably as possible.
At Campbell Bader LLP our family team has collectively spent more than twenty years advising clients about family disputes, including those involving high net worth individuals or complex matters.
We value and incorporate collaborative family law principles into our practice, but we’re smart enough to recognize when that approach won’t work for you and we adapt our strategy accordingly. To learn more about how we can help you, contact us online or at 905-828-2247.