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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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Old 10-15-2011, 10:52 AM
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Default stbx using 20 yr old business loss/bankrupcy against me? Just want my 50%

Can my stbx use the losses from a 20 year old business bankruptcy as a liability against our assets so he pays me less, or perhaps nothing at all?

Friends and family tell me they have never met a nastier stbx who will do ANYTHING to keep his house so my case keeps going on and on with new twists along the way just when I thought we were getting close to settling. Those twists include kicking his kids out because they have been arguing that he is not being fair to me. The kids and I finally left the matrimonial home in Sept 2010 and they won’t speak to him unless they absolutely have to, my stbx and I were living separately in the same house for 2+ years prior to that. Thankfully he travels a lot. He is an extreme narcissist and will continue to hurt us all and deplete all funds just to have his control. I just want my half.

The latest twist...married in ’87, while pregnant with 2nd child in ’91 my stbx’s 16 year old business went bankrupt...just prior to this happening his bank made me sign a personal guarantee they said was just to update their files then two weeks later on Christmas Eve the bank called our note. This forced his business into immediate bankruptcy and in turn forced us each to declare personal bankruptcy as we were each now on the hook for the business loan because the bank made me sign the guarantee. To make a long story short we slowly bought back our home from the bank (thanks to some bail-out money from my aunt) and started over. My stbx started another business and we have been trying to divorce since Sept 2008.


We have not been able to come close to agreeing on a settlement. He hasn’t paid me a cent for my half of the house (and the title of the house is only in my name) or any expenses for the kids - he would not vacate, told me and the kids, then age 17 and 20, to get out, and he insists that the house is his and is only offering me a fraction of what it is worth because he says he put more work and money into it than I did – I was a stay-at-home-mom, helping my stbx part-time with his business until I went back to school and started a new career of my own full time in 2001. I know the law is 50/50 even if I hadn’t worked a day in my life so I have been arguing that point...my stbx is now on his third lawyer yet trying to represent himself.


In June I took him to court to force the sale of the house, it seemed the only way to get this done cleanly. As predicted, the judge took one look at our file, slammed it on the desk and said “this is ridiculous, this has taken far too long” and he wrote a court order to have the house listed for sale. My stbx started sputtering “but I plan on buying it” and the judge said “well sir, you’ve had over two years, what’s your problem” and then judge told him he had two weeks to make the offer to me or he would have to pay full real estate commission on it. I already had a RE agent waiting in the wings to list it and then the guy chickened out because my stbx refused to let him in the house and he changed the locks and the REA didn’t want to get involved in the fight. So before the 2 week period was up my stbx finally made an offer, it was the same as all his other offers, a waste of time so I continued to try to get the house for sale but it never got listed. We decided over the summer that the lawyers were getting too far ahead of us (and our bills way too high) so we thought we could come to our “senses” and work it out between the two of us. He got sugar-sweet and tried to deal over and over with the same offer but it hasn’t worked out. He will not go a penny higher with his offer. Now we have a settlement conference date in front of the same superior court judge for a whole hour in one week from now. I think that the judge can throw contempt charges at both of us for disobeying his court order to list the house for sale, I am preparing myself for that blow. My stbx is pressuring me to have the court date adjourned but I can’t slow this train down now apparently so he says if we go to court he is throwing his bankrupt business loss into the pile of liabilities. I think this is absolutely crazy, I already paid for that loss with bankruptcy and the 7 years of no-credit and financial hell after that. He says the Family Law Act says he can do it and he’s read it with a fine-tooth comb.

Is this just an empty threat or can he actually use that 20 year old financial loss against me? It wasn’t even my business except that I was married to him. His quote is “I will be using the loss of the business if we go to court as it is simple that if the business comes into the marriage and gains value then you get half the value that is gained subsequently if it is lost then you get half the loss.” It was a big loss but I thought the bankruptcy took that loss out of the equation, i.e. can it be used against me again?


This has been his ‘wild card’ he was threatening me with but now that we have to have a settlement conference I know that he will use it, he already paid to have all the accounting done and prepare it for court.


I should say that he has had another successful business since then and we agreed that I would not touch his business and he wouldn't touch my pension. If I went after his business it could cause him to be unemployed and then I might be on the hook for spousal support for him (I have an excellent job). Also it requires forensic accounting and lawyer time which will cost thousands and already we are in major legal debt.


His offer is about 65% of what I was hoping for – this might not seem like a big difference but I have all the expenses for the kids until they are done school and working (except his 1/3 that he is forced to pay by law towards their education) as well I have to replace everything as he wouldn’t let me or one of his children even have one couch from the house (we had 6 couches in the house).


He now lives alone in this beautiful big house on the lake with a big boat, he can rent the place out for $2000 a week in the summer if he wants or could borrow against the house, I have nothing but debt. My old neighbour actually called to see if I was still alive, she said “I thought for sure you must be dead or tied up in someone’s basement because he is living the ‘life of Riley’ now working only about 2 days a week, has a new motorcycle and a different woman at the house each week.” She said, "I've never seen someone so much better off after a divorce than he was before".


I am trying to divorce a lunatic and it's wearing me down!
  #2 (permalink)  
Old 10-15-2011, 12:53 PM
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I can't speak to the legality of the issues you bring up as they are substantial. I just wanted to point out what is an obvious point. You have spent the last how many years allowing yourself to be walked over by your husband. Even if he is 10 times worse than described that fact doesn't change. For instance the signing of your personal gaurantee on a business loan without understanding the state of the business finances and while the persons I know, including myself in a senior management position when I was working go to great lengths to NOT put your personal lives up - EVER. The risk is businesses go down all the time, you loose everything. You did not apparantly seek legal advice which at the minimum you needed to do to understand the consequences of your signature.

Fast forward to today, you continue to allow your husband to bully, threat, and much more which is his right - you are not obligated to even listen. You and your children continue to suffer but nowhere in your post did I read of any plan to put an end to this injustice (can it actually be called an injustice when the other party, yourself, has not taken any real action to protect your interests and as an extension that of your children? You did state he was willing to pay 1/3 tuition........ nice but if you understood the "rules" as set out in the Family Law Act, supporting your over 18 children in school, there are rules for admissability there too) support is much more than a simple 1/3 tuition - you state they are away at school? There can be support obligation there too plus more....... in the end the parents obligation is not set 1/3 but as a ratio of the parents income. If he make 3 times your salary, he pays 3 times more for education/CS.

In the end you do state the legal fees are expensive but it sounds like you have yet to recieve any solid legal advice as to 1. What are your rights, obligations and liabilities. 2. What is a solid plan to move forward, to get things done with a person who is not negotiating. You have made it clear that he is not negotiating but at the same time you have not just gone ahead and forced this divorce to happen, force the "fair" distribution of your remaining net wealth accumilation during your marriage.

You stated a judge said, "this is way too long?" and you are worried that you will be on the hook for not abiding a court order? Did you contact the court and supply the documentation of the steps you took to get your house sold and the steps he took, with dates perferably, to pevent the sale? Even without a lawyer, using the help offered through the duty council available at most family court houses? You would have been guided to the steps, the correct forms, how to fill out the forms, and how to serve the forms to the parties in question....... all this without paying directly for legal representation.

You will get some solid advice on how to do this for yourself on this forum. But you need to act for your own benefit or this will never end? If you need therapy or similar to learn to deal with your husband's "type" - Do so. If you are scared for your safety - there are steps for this as well. If you do not get the personal help to face your fears and then actually take real steps to end this it will go on with offers that are nowhere near acceptable and living under the "tress" you are in will impact your health negatively one day if not already. You have a husband living like a KIng, living off you and he is smart if you think about it - he does not appear to have any morals with respect to you or his /actually your children. Can you tell yourself why would he want to end this.... the longer it goes on the better!

You are here (this may be your best move in 3 plus years because here you will find the help and support you need). This is your 10th post. You have begun to act - Now you must do whatever you are required to put an end to this situation as all the help, support and lawyers fees will not help you if YOU do not do anything with it! Only you can do this for yourself in the end, nobody else.

I am going to end here with one last thought. You state your husband has read with a fine toothed comb The Family Law Act - and perhaps he did not understand portions of it either. It helped me so much and I tell others the first thing you need to do is go online to the Ontario Goverment website. There they have the ontario family law act, the ontario divorce act, then there is the spousal support guidelines (you indicated a concern here if your husband chooses to close his business - here you will learn about "imputed income for support purposes") oh and the child support guideline which I believe has the info re children in post secondary learning.

Read these and you will begin to understand the rules, you will begin to understand what you need to provide your lawyer so your lawyer can be given solid information to your circumstance and as a result should then be able to give you the best legal advice to protect your rights and put an end to your 24 year marriage. At the very least you should be getting proper legal advice to the very serious issues you have brought up. Ultimately what you learn from this will be crucial in your decisions and what you are willing to do moving forward

I hope this helps a little. Welcome to the forum. It will not be an easy route ahead - you will soon find out most here to one degree or another face issues with thier stbx, ex and anything between. You will get through this and your first step is to get your materials ready to bring with you to your court date next week - If you can, don't forget to bring a proper property valuation from the date of your seperation and a second for what it's assessed value is on the market today. If you have found a realtor - perhaps the judge will madate he/she be used to get your house on the market right away? Get prepared.
  #3 (permalink)  
Old 10-15-2011, 02:01 PM
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Wow. All true. Thank-you for that.
I know I’ve been an idiot about this. I also thought hiring a lawyer would make this all happen smoothly and I could stay arms-length, I have been very naive to this ‘game’.

I am relieved that I have documented the steps with the real estate agents attempts to sell the house, my lawyer has filed an up-to-date brief, I have hired another real estate agent who was just in contact with my stbx.

In fact, I just got a text from stbx and this new real estate listing he says is the "tipping point" for him and now, well lets just say he's extremely ticked and says he will have an offer for me on Tuesday.

And I did go to the courthouse a few weeks ago to pick up the forms to push this divorce ahead myself, most of the paperwork I have already filed, the 'divorce' box is already ticked from 2 years ago, just waiting on final settlement. And I've been to legal aid lawyers a few times for advice. My settlement conference date has been booked since June. My lawyer has not been very productive and has cancelled many court dates for other 'emergencies' so I am trying to do as much of this myself. Other court dates were cancelled because of stbx changing lawyers.

When I signed the personal guarantee many years ago I had independent legal advice. Obviously it was not very good legal advice.

And thanks - yes I did get help. It took me a long time to figure out that I have been scared for a long time. I met this stbx when I was in my late teens when my parents died, he is older. I'm not making any excuse with that statement, I take full responsibility for my actions, or inaction, and am now starting to live a much healthier life, as well are the kids. I would like to say to anyone out there who lives with this kind of person or you feel that your life is not yours to control - it is in you, you can gain control of your own life...you will trip and fall but just make that part of the dance. And sometimes it takes the words in this forum to slap you across the face until you get it.

Thanks again.
  #4 (permalink)  
Old 10-15-2011, 05:56 PM
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AHHH! Never an idiot!! Just a person who is on the path to learning! Yes sadly for many, this is not a game you get to play from the sidelines. There are indeed too many sharks waiting in the wings to swallow you whole. It must be a great feeling, at least it should be, to have begun to liberate yourself. Think of yourself as a young flower in the spring, waiting for the rains to stop. One day the sun will shine and you will be the prettiest blossom in a field of flowers!

Sorry didn't mean to be sexest or anything like that - once in a while the prose just flows out of me!

Not sure if this helps, goes back decades, the delays, the lawyer changes, the excuses all really tore my mother apart. Not sure if you can read up anything that will allow you to prevent this practice/extending technique from continuing today. Sort of putting the court on alert to the lawyers that the judge will not accept any delay unless there is a death. I remember this step was finally done in my mother's case. It put a stop to the games and the case was settled quickly after that.

Good to hear you have done great changes in your life. You are almost there! My wishes go your way!
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