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FEATURE ARTICLE

How is a spouse's pre-marriage debt treated for equalization purposes if it is later extinguished by bankruptcy ?

The Ontario Court of Appeal considered this issue in the case of Zavarella v. Zavarella [2013] O.J. No. 5435. In this case, just prior to marriage, the wife had total debts of $59,838, but made an assignment into bankruptcy after marriage. She was later discharged without having made any payments on her debt. At trial, the judge included the full face amount of the debt in the equalization calculation, reasoning that, on the date of marriage, that was the balance owing. The wife appealed.

The Court of Appeal considered previous rulings...


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