At Henderson Heinrichs, we regularly negotiate and conclude separation agreements for our clients. Parties cannot take the provisions of these agreements lightly. When you reach an agreement with your ex-spouse, you had best stick to it. That’s what the court concluded in the recent Supreme Court of British Columbia case of Owen v. Owen, 2011 BCSC 1284.
In Owen, the court was faced with non-payment of spousal support by a wealthy husband, in contravention of the terms of a separation agreement. The court found that, in addition to losing the money itself, the wife lost certainty, security, and the ability to budget, invest and control her own financial resource, all of which she had bargained for in the agreement.
Because of this, the court agreed that the Agreement had been repudiated by the husband, and on the basis of the action brought forward, that the wife accepted that reputiation. The result was stark: the husband was required to pay back the arrears that had accrued under the terms of the agreement to the date the repudiation was accepted. Further, the wife was freed from her obligations under the agreement and was able to once again pursue a reapportionment of the very substantial family assets, something that she had given up under the agreed upon terms. Finally, as the agreement was no longer in effect, the husband was once again required to pay a higher, interim, spousal support sum which had been ordered prior to the Agreement being reached.
The wife, of course, did not have to accept the repudiation, and she could have sought a far more common remedy; namely, that the agreement be enforced. But the choice was hers, and it serves as a valuable reminder that the person breaching the agreement will rarely receive benefit for that breach from the court.