The Ontario Superior Court recently addressed the legal consequences of dissipating family assets in the case of Moretti

Moretti v. Moretti 2023 ONSC 5240

The Ontario Superior Court recently addressed the legal consequences of dissipating family assets in the case of Moretti. The Court assessed and dismissed the wife’s claims to retroactive support and equalization, inter alia, based primarily on a finding that she had spent several millions in the throes of a gambling addiction. The Court ultimately dismissed both parties’ claims against each other, specifically taking time to address a spouse’s reckless depletion of their net family property.

The wife in this case sought retroactive and continuing child and spousal support, equalization and a 50% interest in the matrimonial home. The husband argued that the wife was disentitled from such remedies as a result of having dissipated family assets worth $5 million due to her gambling addiction. He further argued that the wife ought to pay occupation rent for residing in the matrimonial home with her ex-husband, as well as sought damages for a breach of trust in misusing funds

After the parties’ son was born, the wife’s role in the marriage was primarily to care for the parties’ son while the husband operated his concrete business. The wife did earn some cash income during the marriage doing spiritual readings for clients. The wife’s position was that she ceased spiritual readings after a benign tumor in her brain was removed, following which she turned to gambling.

During the marriage, the wife deposited close to $3 million into her bank account. She testified that these amounts were in part lent to her by others because she played the slots so well, though some of the funds was payment for her spiritual guidance. She did not declare any of the money she received on her income tax returns.

In arriving at its decision concerning dissipation, the Court stated that the onus was on the wife to demonstrate which portion of the funds she received were lent to her from third parties’ to use towards gambling, which portion were her winnings, and which portion came from families for spiritual guidance. The Court further found that it was clear based on the evidence that the wife had sufficient funds throughout the marriage to compensate her for taking care of the parties’ son and  scarifies made to her career due to the parties’ respective roles during the relationship.

It was also abundantly clear that the wife did not suffer any disadvantage from her role in the marriage or from the breakdown of the marriage. From 2016 to the date of the trial, the wife’s bank records showed deposits of over $2 million while the husband earned a modest average income of $50,000.00.

The Court found that the wife recklessly dissipated family assets and was not entitled to an equalization payment. The Court ruled that the husband was required to disproportionately incur large liabilities to support the wife during the marriage. The Court considered section 5(6) of the Family Law Act which addresses unequal division of net family property whereby the court is able to award a spouse an amount that is less than half the difference between the net family properties. Section 5(6) in part empowers the court to award unequal division where equalizing the spouses’ net family property would be unconscionable. In the case of Moretti, the wife’s behaviour was found to have shocked the conscience of the Court. The Court found that the wife “did what she pleased” rather than to be conscientious and provide for her retirement or for the care of her son who lives with autism.

The court ultimately dismissed all claims between the husband and wife. The only outstanding issue was ongoing support of the parties’ adult child which issue was reserved due to a lack of information offered by either party as to the son’s current circumstances.

Want to know more?  Email us at:  hello@dicksonappell.com