Parties in a divorce proceeding must disclose their financial documents to each other so that issues such as the division of property, child support and spousal support could be decided as per the Divorce Act (R.S.C., 1985, c. 3 (2nd Supp.)) or the Family Law Act RSA, 2003 Chapter F-4.5.
Section 5.2(1) of the Alberta Rules of Court AR 124/2010 tells us that whatever is relevant and material to the disputed issues in the divorce proceedings should be disclosed. However, a party’s emotions could cause them to decide to withhold or ask for certain information. Legal advice is important in helping determine whether information is relevant and material to the issues at hand to help make the process efficient and keep court costs low.
In the Supreme Court case Rick v Brandsema 2009 SCC 10, the Courts instruct us that parties have the duty to make full and honest disclosure of all relevant financial information. What this means is that the other side does not need to specifically ask for specific financial information – if the information is relevant to the resolution of the issues in divorce, parties must be forthcoming and act in good faith in producing it. This was confirmed in Alberta in the case Brown v Silvera 2009 ABQB 523, which tells us that the courts frown upon the concealment or misrepresentation of assets.
The usual information that needs to be disclosed is outlined on Form FL-17 Notice to Disclose, which is usually filed along a FL-3 Statement of Claim for Divorce and Division of Matrimonial Property. These forms can be found on the Court of Queen’s Bench of Alberta website -httpss://albertacourts.ca/qb/areas-of-law/family/family-law-forms. It is a good idea for the party filing the Notice to Disclose to also start preparing their own disclosure, as the other party will also ask for reciprocal documents.
In summary, the Notice to Disclose asks for:
- Copy of every personal income tax return you have filed for the 3 most recent years, OR if you have not filed a tax return for the previous year, copies of T4, T4A and all other relevant tax slips and statements disclosing all sources of income for the previous year
- Copy of every notice of assessment / reassessment issued to you for each of the 3 most recent tax years
- If you are an employee, copy of 3 most recent statements of earnings
- If receiving income from insurance or disability, most recent statement of income
- If you are a student, statement indicating total amount of student funding you have received during the current school year including loans, bursaries, grants, scholarships and living allowances
- Particulars of self-employment in an unincorporated business
- Confirmation of income from partnership
- Financial statements of corporation if you have a 1% or more interest
- Special or extraordinary expenses for child support
- Trust settlement agreements
- Copies for all statements for all bank accounts held solely or jointly in your name for the last 6 months
- Copies of credit card statements held solely or jointly in your name for the last 6 months
- Monthly budget of expenses
- Sworn itemized income, assets and liabilities
- Copies of most recent statement for RRSPs, pensions, etc.
- List of exemptions claimed
Note that different people may need to disclose more information – for example, a student would need to disclose information regarding their tuition, which is not applicable to a business owner who no longer goes to school. A good rule of thumb to avoid future headache and to avoid further court procedure in resolving the file is to go over Form FL-17’s list and provide everything that applies to you.
If there is an issue regarding one’s ability to get the required information above, that party should ask for an adjournment in order to have more time to get disclosure. Parties can also attend Questioning, where lawyers ask the parties questions under oath to obtain further information. Lawyers can also ask for Undertakings or further documents needed to bring the matter to resolution, if the information provided in the party’s Notice to Disclose does not sufficiently resolve the issue.
A party that fails to provide documents as per the Notice to Disclose or Undertakings faces the risk that the court would draw an adverse inference against the party and impute their income. This basically means that the Court would do an estimation of your income based on averages of the income of your profession. A potential problem with this is that the Court may impute a higher income to you, and then you would be stuck paying higher support payments. A further risk in choosing to refuse to give financial disclosure is that Judges may think that you are trying to lie, misrepresent, or unjustly delay court proceedings, which could make them grant a Costs award against you. A party may also ask for Retroactive Payments to recover amounts that were not paid due to the refusal to give financial disclosure.
Rafael completed his Juris Doctor from the University of Calgary, where he also graduated with a Bachelor of Arts in Political Science. During law school, Rafael volunteered with Pro Bono Students Canada as a Project Coordinator for the Immigration Project, and with Student Legal Assistance as a student caseworker, providing legal services to diverse clients.
Rafael is an active member in the Filipino Calgarian community and can provide services in Tagalog (Filipino) and English.