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Virey v. Virey: Despite Any Agreement to the Contrary? An Estate’s Obligations for Ongoing Support

5 minute read
Also authored by: Alex Alferiev

The area and practise of family law is shaped by and evolves through societal change, legislation, global events (like a pandemic), and through judicial decisions of the Courts in Ontario and across Canada. FamilyMatters is the Lerners Family Law Group’s weekly update on how that change is being made:

In April, the Ontario Superior Court of Justice released Virey v Virey, 2021 ONSC 2893. The decision addressed the following question: can the Estate of a deceased spouse have an ongoing obligation to support a dependant spouse even where both parties have signed an agreement explicitly releasing the Estate of such an obligation?

Given the decision in Virey, the answer is yes.

The Applicant, a former spouse of the Deceased, claimed that the Estate had an ongoing support obligation towards her. In response, the Estate pointed to Minutes of Settlement signed by the Applicant as part of a Divorce Judgment. The minutes contained a release of each of the parties from “any further claims with respect to support maintenance pursuant to the Family Law Act, the Divorce Act, the common law or otherwise.”

The Court found in favour of the Applicant by relying on section 63(4) of the Succession Law Reform Act (SLRA) which authorises the Court to make an award of support “despite any agreement to the contrary.” The Court found the release in the Minutes of Settlement to be relevant but not determinative.

The critical fact for the Court was that the Applicant was relying on the support of the Deceased at the time of his death. Without it, the Applicant would be reduced to living only on her pension and benefits totaling roughly $1,100 per month. The Estate, by contrast, owned valuable property and liquid assets.

The Court relied heavily on the decision in Butts Estate v. Butts[1] — a case that is very similar on the facts. In that case, the Court granted ongoing support to the former wife of the deceased on the basis that such support would bring her out of poverty.

This is a departure from previous caselaw. For example, in Vanderven v. Vanderven Estate[2] the Court stated that section 63(4) is not a “notwithstanding clause that renders separation agreements meaningless.” The Court emphasised that the separation agreement signed by the parties before it clearly showed that they had contracted out of any remedies under the SLRA.

Similarly, in Frye v. Frye[3], the Court also enforced Minutes of Settlement signed by an impoverished spouse where she released her husband from any future claims. However, the Court did point out that the applicant was impoverished not because the settlement was inadequate but because she had lost money in risky investments. Perhaps if the facts were more similar to Virey, the Court might have decided differently.

Following Frye, the Ontario Superior Court in Fune v. Hoy Estate[4] came to the same conclusion. The Court stated that the applicants “clearly and unambiguously released any interest they might have had in their husbands' estates in exchange for generous support provisions.”

The departure aligns with a shift in societal values mentioned in Virey quoting the Ontario Court of Appeal in Cummings[5]: that spouses are now entitled to not just maintenance but also a share of each other’s estate when the marriage is over.

So how should lawyers now draft separation agreements, minutes of settlement, and the like to best protect their clients and the clients’ Estates?

First, it is important to note that the Court in Virey pointed out that the SLRA was never explicitly referenced in the Minutes of Settlement or the Divorce Judgment. This may give lawyers some hope of drafting a binding release with respect to the SLRA.

Second, in Vanderven, the Court enforced the agreement the parties signed because both had independent legal advice — re-emphasising the old adage that legal advice suggests an informed choice.

The impoverishment of the surviving spouse or dependant at the time of death remains the clinching factor in the application of section 63(4), however. The decision in Virey confirmed the importance of this unpredictable element.

About the Lerners Family Law Group

At a time when much is at stake, there is no substitute for having the experienced and skilled advocates from Lerners at your side. You need compassion and understanding, but you also need someone to protect your interests. Our Family Law Group tailors its approach and strategy to your goals to achieve the best possible outcome. Our team, located in Toronto and London, serving the GTA, Southwestern Ontario, and beyond, has the experience to handle matters both straightforward and complicated, without ever over-lawyering or contributing to unnecessary conflict. With a successful track record that includes some of Canada’s most complex family law cases, we are focused on getting you results and helping you move forward. Contact us to see how we can help.

[1] Butts Estate v Butts, [1999] O.J. No. 1672 (OCJ Gen Div).

[2] Vanderven v Vanderven Estate, [1998] 72 O.T.C. 68 (OCJ Gen Div).

[3] Frye v Frye, [1992] RLF 3d (OCJ Gen Div).

[4] Fune v Hoy Estate, [1995] 10 RLF 4th (OCJ Gen Div)

[5] Cummings v Cummings, [2004] 235 DLR 4th (Ont CA).

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