Hiding Assets in a Divorce: Disclosure Duties in Ontario

Many people going through a divorce worry that a spouse is not telling the whole story about money. Ontario's rules require financial disclosure so that support and property claims are decided on real numbers.

This article explains what each side must disclose, what can happen when someone does not, and what to do if you suspect assets are being hidden.

The duty to give financial information

Anyone who claims support or property must serve and file a financial statement. Use Form 13 for a support claim without a property claim, and Form 13.1 for any property claim, whether or not support is also claimed. The same applies to a claim for exclusive possession of the matrimonial home.

Financial statements must be sworn before a commissioner of oaths, and supporting financial documents must also be provided. How this applies to your own statement depends on your situation, so it is worth confirming with a lawyer.

There are exceptions. If the only support claim is child support in the table amount, no financial statement is needed, unless there is also a property claim or a claim for exclusive possession of the matrimonial home. Consent claims for spousal support under the Divorce Act are also exempt.

What has to be counted

Property division in Ontario is based on net family property. This is the value of all property a spouse owns on the valuation date, minus debts and the net value of property owned on the marriage date. It is never less than zero.

The spouse with the smaller net family property is entitled to one-half of the difference between the two. That is why an undisclosed account or asset can change the result.

• Pension rights count as property, valued at their imputed value for family law purposes from the marriage to the valuation date.
• A business or company shares are valued the same way as other property on the valuation date.
• Debts on the valuation date reduce a spouse's net family property.
• Some property is excluded, such as gifts or inheritances from a third person after the marriage (other than a matrimonial home), personal injury damages and life insurance proceeds.

No deduction is allowed for the value of a matrimonial home owned on the marriage date, so its full value is shared.

Consequences of not disclosing

A party must correct or update any served financial document as soon as they find it is wrong. If a party fails to disclose, the court can order the documents served and must award costs.

If a party does not obey an order, the court can dismiss a claim or strike out that party's documents.

The court can also depart from an equal split if equalizing would be unconscionable. Factors include debts incurred recklessly or in bad faith and intentional or reckless depletion of net family property.

Deadlines for property claims

An equalization claim must be started by the earliest of 2 years after the divorce, 6 years after separation with no reasonable prospect of living together again, or 6 months after the first spouse's death. Do not assume you have the longest period.

What to do next

• Gather what you already know: bank statements, tax returns, pension statements and any business records you can lawfully access.
• Note anything that does not match the financial statement your spouse swore.
• Ask a lawyer whether to request an order for documents to be served.
• Check your deadline for starting a property claim.
• Consider mediation where appropriate, but get independent advice before signing any agreement.

Frequently asked questions