You could use an online template to prepare a Separation Agreement or you can use a lawyer to draft a legally binding Separation Agreement. The decision should be easy, right?
IT IS NOT. This is about your relationship, your divorce, your children, the division of the assets and debts you have accumulated with your spouse. The decisions you make today, will have lasting effects in the future.
Here are some things that must be considered in legally binding Separation Agreement:
- It must be in writing,
- Both your signatures must be witnessed,
- Have accurate and proper financial disclosure which may include:
- an F8 Financial Statement,
- an expert valuation of your home,
- an expert valuation of your business,
- monthly bank account statements,
- monthly credit card statements,
- tax documentation such as T1 Generals, T2 Corporate Statements and Notices of Assessment;
- Must state whether the Agreement is temporary or final;
- If there are property issues, it must state how you divide that property;
- If there is debt, it must state how you will divide debt;
- If there are children, it should state custody and/or guardianship rights;
- If there are children, it should state how often will parenting arrangements be reviewed;
- Should spousal support be payable, and if yes, how often should it be reviewed;
- Who will pay for the divorce.
There are many more considerations for a Separation Agreement to be legally binding. It must comply with family law in British Columbia. If not, a Separation Agreement may be found illegal and may be cancelled.
Some reasons a Separation Agreement can be cancelled include:
Lack of Independent Legal Advice
- Not having a lawyer provide both you and your spouse with independent legal advice can be fatal. A judge may set aside an unfair agreement where there was no independent legal advice.
Lack of Proper Financial Disclosure
- If one of you found out in the future that the other lied, the agreement can be challenged. Proper financial disclosure is important.
- The time after a separation is wrought with hurt, anger, feelings of loss – in situations of infidelity, there also feelings of guilt and feelings of revenge. People pressure one another to sign agreements within a short time, taking advantage of the other person’s guilt. Pressure may also happen when one person is financially weaker than the other. If a judge may find the agreement was signed under duress, the agreement is set aside.
- Mistake can mean that you did not understand what you were signing or what things meant. If you can prove this, a judge may set the agreement aside.
- If the separation agreement is found by the court to be significantly unfair, it can be set aside or cancelled.
Although the desire to save money may be strong, the money you spend now on a lawyer will ensure that you have a Separation Agreement negotiated in good faith with full disclosure. Ultimately, you do need a lawyer to do your Separation Agreement. Furthermore, if another lawyer drafted the Separation Agreement, you will need independent legal advice.
How much does it cost?
If you are concerned about the cost, consider the cost of completing a Separation Agreement versus challenging a badly drafted Separation agreement.
- The cost of drafting a legally binding Separation in Agreement ranges from $1,500 to $5,000.
- The cost of challenging or defending a badly drafted Separation Agreement can be anywhere from $15,000 to $100,000.
- The cost of not having a Separation Agreement at all, and having to go to court for all issues involved in your family matter can range from $5,000 to $100,000.
So, if you are going to draft a Separation Agreement, then do it right. When it comes to your entire life savings, your separation, your children, invest the money and the time to have a proper Separation Agreement in place. You will pay the fraction of the price you would otherwise have to pay in any potential court proceeding.
Who shall I talk to?
For legal advice on drafting a legally binding Separation Agreement please contact our offices.