How Can A Prenuptial Agreement Be Overturned?

Legal Grounds for Overturning a Prenuptial Agreement in Ontario

Ontario courts apply strict scrutiny to prenuptial agreements, particularly if the agreement seems unfair or one party claims they were not treated equally in the process. Below are the most common legal grounds upon which a prenup may be set aside:

Lack of Full and Honest Financial Disclosure

One of the most common reasons a prenuptial agreement is overturned in Toronto is the failure to fully disclose financial information.

• Each party must disclose all assets, liabilities, and income: Without transparent disclosure, it’s impossible to ensure that both parties entered the agreement with a full understanding of their financial position.
• Failure to disclose can render the agreement invalid: If one party hides significant assets or debts, the agreement may be set aside by the court for being fundamentally unfair or signed under false pretences.
• Real-life examples from Toronto cases: In LeVan v. LeVan (2008 ONCA 388), the Ontario Court of Appeal set aside a prenuptial agreement where the wife did not have full insight into the husband’s corporate interests. This precedent highlights the importance of transparency in prenup negotiations.

Absence of Independent Legal Advice

A lack of independent legal representation is one of the most common reasons courts in Ontario may overturn a prenuptial agreement.

• Both parties should have separate legal representation: Independent legal advice ensures that each party understands their rights and the implications of the agreement.
• If one party didn’t understand the legal implications, the agreement may be challenged: A signature alone isn’t enough—understanding is key. If one spouse didn’t fully comprehend what they were agreeing to, the contract may not be enforceable.
• Toronto legal practice: Family lawyers in Toronto regularly advise clients on prenups, and courts give significant weight to documented legal guidance when evaluating validity.

Duress or Undue Pressure

A prenuptial agreement in Ontario must be entered into freely and voluntarily. Any indication of pressure can be grounds for overturning the agreement.

• Signing under emotional or financial pressure: If one partner was manipulated into signing—due to fear of losing the wedding or financial dependence—courts may intervene.
• Signing right before the wedding may be seen as coercive: Agreements signed just days before the ceremony can raise red flags, especially if legal advice was not properly obtained.
• Courts look for signs of free and informed consent: Judges consider not only whether the signature is present but whether the process leading up to it was fair and respectful.

Unconscionable Terms

If the agreement heavily favours one party at the expense of the other, it may be deemed unconscionable.

• If the terms are extremely unfair or one-sided: Agreements that create significant imbalance may not be upheld.
• Spousal support waivers that leave a spouse destitute may be struck down: Especially in long marriages or where one partner became financially dependent.
• Disproportionate asset division may be challenged post-separation: If the agreement leaves one party with virtually nothing while the other retains substantial wealth, courts may intervene.

Changes in Circumstances

Even a fair prenup at the time of signing can become unjust due to life events.

• Significant life changes (e.g., illness, childbirth, job loss) may make a prenup unfair: A drastic shift in circumstances can lead to financial hardship, which the courts will not ignore.
• Courts may vary or set aside parts of the agreement if enforcing it causes hardship: Judges have the discretion to adjust or invalidate parts of a prenup that no longer align with current realities.

How Courts in Toronto Evaluate These Cases

Importance of Context and Fairness

• More than just a signed contract: While a prenuptial agreement is legally binding, courts will assess whether it was negotiated and executed fairly.
• Circumstances at signing and at enforcement: Judges examine what was happening when the agreement was signed—Was there pressure? Was legal advice provided? Were both parties on equal footing?
• Changing situations over time: If a spouse becomes sick, loses employment, or takes on parenting duties that weren’t anticipated when the prenup was signed, the court may consider these life changes.

Review of Ontario Case Law and Judicial Discretion

• Ontario courts have wide latitude: Judges have significant discretion in family law matters and frequently refer to previous rulings when deciding on the enforceability of prenuptial agreements.
• Landmark Toronto case examples: In LeVan v. LeVan, the Ontario Court of Appeal emphasized full financial disclosure and fairness. Other cases, like Rick v. Brandsema, have reinforced the importance of informed consent and equal bargaining power.
• Case-by-case evaluation: Each case is decided on its unique facts. What may be enforceable in one case could be overturned in another due to different circumstances.

Court Will Weigh Intention, Fairness, and Public Policy

• Parties’ original intention matters: Courts will consider whether the agreement reflects what both parties truly intended at the time of signing.
• Fairness remains the cornerstone: Judges may set aside an agreement if enforcing it would lead to significant financial disparity or undue hardship.
• Public policy considerations: Certain provisions—such as those limiting child support or promoting unequal treatment—may be found unenforceable because they contradict the Family Law Act or broader legal standards.

Steps to Protect Your Prenuptial Agreement from Being Overturned

Draft with Full Transparency

• Include detailed financial statements: Both parties should provide a clear and honest accounting of all income, assets, and debts. This includes tax returns, business valuations, bank accounts, and liabilities.
• Clearly explain the purpose and benefits of the agreement: Document why the agreement was created and how it benefits both individuals. A well-explained rationale can support enforceability.

Obtain Independent Legal Advice

• Document the legal advice each party received: Ensure both individuals receive separate and thorough legal counsel. Written confirmation from each lawyer should be kept with the agreement.
• Avoid using the same lawyer for both parties: Sharing a lawyer creates a conflict of interest and could lead to claims that one party was not properly represented—an issue courts in Toronto take seriously.

Avoid Rushed Signatures

• Sign well in advance of the wedding: Prenups signed a few days before the wedding may be viewed as coercive. Ideally, sign the agreement several months before the wedding date.
• Allow enough time for review, negotiation, and revisions: A rushed process could later be seen as a lack of informed consent. Taking time shows the agreement was entered into voluntarily and thoughtfully.

Update the Agreement if Necessary

• Revisit the agreement after major life changes: Illness, career shifts, children, or significant financial events may warrant a review of your prenup to ensure it remains fair and relevant.
• Consider a postnuptial agreement to reaffirm or revise terms: A postnup can update your original agreement or confirm its ongoing validity, especially in response to life developments.

Creating a valid and enforceable prenuptial agreement in Ontario requires more than just signatures on paper. It demands transparency, legal guidance, and a commitment to fairness.