Mixing Business and Divorce

While the law views a marriage as a partnership, some married couples have a similar view and as a result decide to run businesses together while married. When divorce is on the cards many couples are unsure whether to remain in business with their partners or dissolve the business entirely. This article will discuss some factors to take into consideration when deciding to stay in business with your ex-spouse.

A 2007 Census Bureau estimate showed that about 3.7 million businesses are owned by married couples, therefore, the implication is real in respect of divorce process when it comes to business owning couples being faced with complicated decisions, both business and personal, if they decide to end their marriage.

It must be noted that working together after divorce is an admirable goal, however, it may not be a realistic one for many divorcing couples. Generally, a divorce is an emotional and contentious matter due to a number of reasons. This is because during a divorce a couple has to divide assets, such as the marital home and properties, they need to agree on child custody, visitation and alimony. And as a result divorcing couples do not see eye to eye on these issues especially where considerable assets are involved. This is especially true in respect of contested divorce litigation. While many judges would say that divorces do not belong in court, due to the number of issues that couples are not able to agree upon a contested divorce can turn an already strained relationship sour. A number of people may argue that a trust relationship in a marriage is not exactly the same as the one in business; the element of trust is essential in both respects. As a result re-cultivating a relationship of trust after a divorce may lead to business failure.

It is important to note that a divorce can be contested or uncontested. It must be noted that a contested divorce is when the spouses disagree on some or all the issues within the divorce. In a contested divorce both parties must set out their positions and views on the issues in dispute. Contested divorce may be settled in a number of ways such as outside of court, through negotiation or through formal divorce procedures. However, an uncontested divorce is where both parties agree to separate and are able to reach an agreement as to all the details in respect of the divorce.

When parties cannot agree to the terms of a divorce the parties try and reach a settlement outside of court. Where a settlement fails, the couple proceed to trial where a judge will make the decision based on evidence and testimony. Given the already contentious process of negotiating the terms of a divorce, adding in a business that needs running can really complicate matters. Divorced spouses often have a hard time maintaining a civilised relationship and as a result of trying to run a business together it puts a real strain on both parties as well as the business itself.
For legal advice on contested or uncontested divorce contact family lawyer Toronto.

Benefits of an Uncontested Divorce

The easiest of all types of divorce is an uncontested divorce. An uncontested divorce is where the couple agrees on all issues relating to their divorce and this is when one spouse files an application for divorce and the other spouse does not file an answer. The spouse’s failure to file an answer is taken as being in agreement to the divorce filed; and he or she is not contesting the divorce and is in agreement with the divorce application. Therefore, one does not file for an uncontested divorce however, the divorce becomes uncontested if one spouse fails to file an answer to the divorce application of the other spouse within the required period of time.

The advantages of an uncontested divorce are:

  • The marriage ends in a dignified and quiet way as the courts will grant the divorce without requiring the spouses to appear in court.
  • An uncontested divorce can be resolved quicker and simpler than a contested divorce. The whole process is less stressful and there is a greater degree of privacy and control.
  • The process of an uncontested divorce is shorter than a contested divorce which tends to drag an already long process longer. However, an uncontested divorce may take between four to six months instead of a number of years (that is after the one year separation requirement), therefore it makes for a quick divorce. As a result of this shorter duration it limits the stressful and tense experience associated with contested divorces and allows the spouses to get on with their lives faster.
  • The main advantage of uncontested divorce is it lowers cost. This is because of the minimal involvement of outside parties in settling issues relating to the divorce. Here the divorcing parties must bargain with one another so as to settle issues. The issues involved in the bargaining process include such issues as child and spousal support, access and control of children, child custody, division of property and finances, etc.
  • An uncontested divorce often allows for parties to the divorce to remain civil throughout the whole process and without the conflict associated with a contested divorce.
  • An uncontested divorce has benefits to one’s family in that because the process is smooth and as a result to the low cost associated with it and the shorter time the process takes each divorce spouse can focus on their family and moving on. Further, the strain is lessened on the family and friends of the couple who are not forced to pick sides or required to give evidence by way of written or oral testimony as required in a contested divorce; which puts undue strain on the family and friends of the divorcing parties.

The main disadvantage of an uncontested divorce is where one spouse is being physically abused by the other spouse and where there is a history of domestic violence, emotional abuse or a disparity in power within the relationship. The problem this causes in uncontested divorce is that almost always one spouse has the advantage over the other, therefore, legal representation is needed for the abused party to the divorce.

Separation Agreement in Toronto

Separation Agreement in Toronto


What is a Separation Agreement?

If you are contemplating a separation or are separated from your spouse or common-law partner, a domestic contract known as a ‘separation agreement’ may be drafted to make arrangements for issues such as:

  1. Division of Property (i.e. who gets to keep the car);
  2. Spousal support/spousal support releases and child support;
  3. The living arrangement of the children (i.e. custody and access).
  4. Parenting plans (i.e. religious issues, educational matters, travel etc.)
  5. Debts, pensions, medical/dental benefits, life insurance.

It is inadvisable to simply have a verbal agreement between two separating partners as it may be highly difficult to prove verbal agreements before a court of law.

A separation agreement Toronto is not a requirement to getting separated or obtaining a divorce. It primarily serves to provide definition and clarity in what can be a highly confusing and stressful situation. You do not need a lawyer to draft a separation agreement as long as it is signed by both parties in front of a witness and dated.

However, while you do not formally need a lawyer to draft a separation agreement in Toronto, it is highly recommended to retain a lawyer to draft a separation agreement as determining spousal rights and responsibilities upon the break down of a relationship maybe a highly complex task. Your lawyer will  navigate you through the process to ensure you fully understand your rights and obligations under the separation agreement and that the separation agreement is clear, complete and legally enforceable.

If you cannot agree on the contents of the separation agreement, you may also choose to go to a mediator who will then mediate the issues you and your spouse or partner are facing and then try to come to solution that is agreeable to both.


One lawyer cannot act for both parties who are in need of advice in respect of advising on the contents of a separation agreement in Toronto. The parties must obtain their own independent legal advice. The reason for this is that a lawyer cannot fairly represent parties whose interests are not aligned. As is often the case in family law litigation, there are significant difference of opinions when determining rights and responsibilities of the parties involved.  Therefore, independent legal advice becomes vital before signing a separation agreement.

It is also advisable to obtain and execute an Independent Legal Advice certificates so that in the future, a party will be unable to claim that they did not understand the content of the separation agreement making it unlikely for the court to set aside the separation agreement in Toronto on that basis.


Section 56(4) of the Family Law Act provides that a separation agreement will be found legally enforceable if all three criteria were present at the time the agreement was executed:

  1. significant assets and significant liabilities of both parties were disclosed at the time the agreement was made;
  2. both parties understood the nature or consequence of agreement made;
  3. the agreement was made in accordance to the law of contract. (i.e. the agreement will not be legally enforceable if it contains terms that are illegal)


The Family Law Act grants the court the power to set aside or nullify a Separation Agreement or any clause in that contract if:

  1. a spouse failed to disclose to the other significant assets, significant debts or other liabilities that existed when the Separation Agreement was made;
  2. if a spouse signs an agreement while being forced, coerced or under duress
  3. if a spouse did not understand the nature or consequences of the Separation Agreement; or
  4. if the Separation Agreement was not prepared in accordance with the law of contract.


Before you sign a separation agreement you must understand that the decisions made in this agreement will effect your future and your children’s future. A legally valid separation agreement must be abided by and will likely be upheld in a court of law in case of dispute. Therefore it is utmost important  and best to have it created by and reviewed by a lawyer to ensure the protection of your rights.

Here is a list of helpful resources that you may review when deciding whether a Separation Agreement in Toronto is right for you:

Divorce and Separation
What you should know about Family Law in Ontario
What are my rights when separating?
Family Law Information Centres
Helping Children Cope
Collaborative Family Law
Court Locations and Addresses in Ontario

Uncontested Divorce in Ontario

Divorce Lawyer Toronto

When filing an uncontested divorce in Ontario, there are two types of uncontested cases:

Uncontested Sole Divorce: When both spouses are in agreement about the divorce and do not oppose the divorce, either the husband or wife files the divorce papers with the court asking for the divorce. Once the papers are filed with the court, your spouse is served with the divorce papers. Your spouse then has 30 days to contest or challenge the divorce, or make a claim such as for support, property, custody, etc. If your spouse does not challenge the divorce within the required period, the divorce will proceed as “uncontested” and will be finalized by the Ontario court.

Uncontested Joint Divorce: The second way to proceed is to file a joint divorce. In this type of filing, both the husband and wife sign and swear the divorce papers, including the Affidavit of Divorce. Neither spouse is suing the other for divorce – you are simply asking the Ontario court to grant a divorce based on separation. In a joint divorce application, spouses can also jointly ask the court to include an order relating to custody, access, support if both spouses agree to the terms. Couples prefer filing a joint divorce because filing in this manner does not require serving divorce documents on the other spouse.

Divorce Time Frame: The time that it takes to process an uncontested divorce in Ontario varies based on a number of factors. One of these factors may be the courthouse in which your divorce papers are filed. Family courts across Ontario vary in the time they take to process applications. However, as a general time frame, if all the necessary steps are taken and the documents are filed on time, it takes about 2 to 3 months to process the entire uncontested divorce in Ontario.

Clearance Certificate: Once the 8A application for divorce is filed, a document called the “clearance certificate” is sent from the Central Registry of Divorce Proceedings located in Ottawa, Ontario to the courthouse in which the divorce application is filed. This Registry keeps nation-wide records of divorce applications filed after July 2, 1968. If there is another divorce application involving the same two spouses, the Registry lets the courts know. If there are no other divorce applications involving the two spouses, the clearance certificate is sent and the divorce process moves forward. For more information about the Central Registry, you can click here.

I hope we were able to give you some of the information you required in order to make your decision about the type of divorce in Ontario that you will be filing. Whether you are filling a sole divorce or a joint divorce, our Family Lawyer can process your case or guide your decisions. Here is a link to recent publications about Family Law on the Department of Justice website.

NOTICE AND DISCLAIMER: The material posted on this website is for informational purposes only and should not be relied upon as legal advice. If you are in need of legal advice relating to your particular situation it is highly recommended to consult with a lawyer.