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

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  #11  
Old 07-28-2014, 03:11 PM
stripes stripes is offline
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Originally Posted by Rioe View Post
The money that went from your inheritance to her became matrimonial money, and is still half yours, no matter whose name is on the accounts, who claimed it on income tax and where the money went, including the profit. The only money which is excluded from equalization is the amount remaining in your inheritance account.

If any money got repaid back into the inheritance account, that might be iffy. I'm not sure if you can un-co-mingle funds. Depends on your documentation and how hard you want to fight. The amount may not be worth fighting over.
^^^ I'm not an accountant, but ... yup. I think the money you lent to her becomes part of the matrimonial property, because it became part of your finances as a couple when it moved from your account to hers. It's the same as if you had used part of your inheritance to pay for repairs to the roof - you can't now pull that amount of money back and claim that it's yours. (The 1% interest that you charged her would also be part of the matrimonial property, as a shared asset, I believe).

Do the math - what would the complete matrimonial property look like with the loan included (the amount of the loan is shared property), and with the loan excluded (the amount of the loan is entirely yours)? Unless the difference is on the order of tens of thousands of dollars, it's probably simpler and cheaper to just accept that the value of the loan has become part of your joint finances, and do the equalization on that basis, rather than drag out hours of lawyer time over this.

Alternately, if there's some other issue that you're negotiating over, you could use the inclusion of the loan in marital property as a negotiating card - if she agrees to let you keep the boat (or whatever), you'll agree not to exclude the loan from the marital property. Her lawyer might call your bluff, of course.
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  #12  
Old 07-28-2014, 08:46 PM
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Hi Rioe,
Just to clarify... at date of separation, the loan was closed and the principal of the loan was back in my inheritance account in my name (she still had the profit generated from the investments remaining).
Do you mean that a while prior to separation happening, the money was repaid back into the inheritance? Or do you mean that because you were separating, you insisted on the loan money being repaid?

In the first instance, you're in the clear. The whole inheritance, plus the 1% interest, is excluded property and does not get divided.

In the second, I'm not so sure. Your ex could maybe have an argument that it was marital money and you just yanked it away because you were planning on leaving her. Kind of like the situation where someone deliberately runs up the credit cards prior to separation, or empties the bank accounts.

What is your ex arguing should happen?
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  #13  
Old 07-29-2014, 08:14 AM
in_time in_time is offline
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It is the first scenario. The loan was repaid and the principal I loaned her from my inheritance account was back under my name (plus interest).

Anyway, at this time I do not know her intentions.... we have not yet "lawyered up". I am trying to get ahead of the game so to speak. I am hoping we can do a collaborative process on the split and this will not become an issue to argue over. I hope she has the decency to respect this money was left to me exclusively by my parents.

I will post an update as it progresses.
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  #14  
Old 07-29-2014, 01:23 PM
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Originally Posted by in_time View Post
It is the first scenario. The loan was repaid and the principal I loaned her from my inheritance account was back under my name (plus interest).

Anyway, at this time I do not know her intentions.... we have not yet "lawyered up". I am trying to get ahead of the game so to speak. I am hoping we can do a collaborative process on the split and this will not become an issue to argue over. I hope she has the decency to respect this money was left to me exclusively by my parents.

I will post an update as it progresses.
So you lent money to your ex and charged her interest on it, and now you claim both the amount of the loan and the interest your ex paid are excluded from marital property? I think you might want to see a financial expert about this one. I think your ex might have a good case to argue that by "investing" the money in her, you were no longer keeping it separate and apart from the marital finances, just as if you had chosen to invest it instead in spousal RRSP or any other form of joint investment.

The fact that you were charging her interest and profiting off her use of your inheritance sounds like a complicating factor.

I strongly recommend getting some expert advice on this one before you start the lawyering - don't assume that it would be "indecent" of your wife to not "respect" your inheritance, when she may in fact have a legitimate claim to a portion of the inheritance which was mingled with your joint finances in the course of her investing.
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  #15  
Old 07-29-2014, 04:11 PM
Once.is.enough Once.is.enough is offline
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His money his investment. Not commingled in my opinion. But there are greasy women out there who will argue anything to steal a buck rather then earning it. There is a line up lawyers to encourage and profit from this. Good luck
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  #16  
Old 07-29-2014, 04:18 PM
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I would get financial advice. Fact that money was shifted around from one person to another, documented on income tax return, might raise valid questions down the road....
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  #17  
Old 07-30-2014, 01:37 PM
in_time in_time is offline
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Thanks for your help folks.
I have a feeling this is going to get complicated really fast. There are other things going on I had no idea about (she has a SO on the side... but I have yet to get any backable proof on it). This might work in my favor, as she might feel pressure to wrap things up quickly to jump into this other relationship.

I'm still shocked after almost 24 years I could be so blind to miss this coming. It seems like this happens a lot.

I will seek out financial and legal advice.... and hope that I can salvage as much as I can.

I will post back once I know the resolution (good or bad).
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  #18  
Old 07-30-2014, 02:03 PM
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Originally Posted by in_time View Post
Thanks for your help folks.
I have a feeling this is going to get complicated really fast. There are other things going on I had no idea about (she has a SO on the side... but I have yet to get any backable proof on it). This might work in my favor, as she might feel pressure to wrap things up quickly to jump into this other relationship.

I'm still shocked after almost 24 years I could be so blind to miss this coming. It seems like this happens a lot.

I will seek out financial and legal advice.... and hope that I can salvage as much as I can.

I will post back once I know the resolution (good or bad).

It haappens more than you can shake a stick at. You say 24, try 30 plus years for some people. There are more people having affairs on the down low either through office romance or online whilst still married to a person they are bored with

Some have figured that if they drag out the length of the cohabit, it works out in their favour for any potential spousal support, before they move on the next...IT (game of tag)

People these days just don't want to spend "the rest of their lives" with teh same person, contrary to what you might hear or read...there is always a whole bunch of things that pop up later, that you then want to change.

Imagine a "home buddy" and an adventurous type getting together for cuteness sake...you know it's only a matter of time before things go South. A simple let's go for a hike or bike ride, turns into an issue
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  #19  
Old 07-30-2014, 02:13 PM
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Quote:
Originally Posted by in_time View Post
Thanks for your help folks.
I have a feeling this is going to get complicated really fast. There are other things going on I had no idea about (she has a SO on the side... but I have yet to get any backable proof on it). This might work in my favor, as she might feel pressure to wrap things up quickly to jump into this other relationship.

I'm still shocked after almost 24 years I could be so blind to miss this coming. It seems like this happens a lot.

I will seek out financial and legal advice.... and hope that I can salvage as much as I can.

I will post back once I know the resolution (good or bad).
Just so you know the affair is completely irrelevant to the court.

Just some advice from someone who spent $25k on lawyers (a low amount) you might want to consider very strongly settling even if it mean giving into some of her demands. If you go to court to "WIN" you with both lose. I had no choice in my case because the only offer I ever received from my ex was so out there that even in her best case scenario she would have never been awarded it in court.

I'd be willing to give up $$$$ if it means settling out of court. Simple business decision.
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  #20  
Old 07-30-2014, 05:09 PM
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I find it interesting that more people don't consider binding arbitration. Much cheaper and faster than the typical trial route. I was married for 30 yrs, full business partner with ex and we were divorced within 9 months of when I kicked his ass to the wind.

I suspect that many lawyers don't recommend it because a) they have little or no experience with it and b) if you have equity/assets in the marriage the lawyer has an eye to maximizing billable hours or c) parties can't agree on a thing including agreement to consider alternative forms of dispute resolution.

Nice thing about binding arbitration is that it is private (not published on CanLii).

Adultery (if either party agrees to admit it) lets you forego waiting period of one year to apply for a divorce.

I think arbitration is a civilized way to end a marriage. No one testifies and whole matter can be done in a day or less, depending upon the complexity of your finances.
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