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Debra, Lawyer
Category: Canada Law
Satisfied Customers: 99916
Experience:  Lawyer
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My common law spouse of 6 years now had an agrrement

Customer Question

Hello: My common law spouse of 6 years now had an agrrement as part of her divorce setttlement with her ex husband that he would take over the mortgage of the family home . ( about $40,000) Within the 1st year of the divorce being finalized her ex claimed bankruptcy. Once he did that the mortgage holder who I believe was HMCA or something to that effect. I believe it may be goverment related. Not to familiar with Ont laws since we are living in BC now has been harrasing my spouse for the money owing since her name was also on the mortgage. She works a minimum wage job with about 16 hours a week. The bill collectors have stopped going after her ex for the money since he claimed bankruptcy. He has been working full time since claiming bankruptcy which i believe the collectors do not know. My spouses income taxe returns have been garnished and all goes towards the payments for the mortgage oweing. My question to you is since her ex climed bankruptcy does that relieve him of his responsibilty to honour his part of the divorce settlement while working full time? Would my spouse have a chance if we went to court of having a judge make him honour the agreement?
looking forward to your reply. This causes a lot of stress on my spouse when the collectors call threatening her.
e-mail is *****@******.***
Submitted: 2 years ago.
Category: Canada Law
Expert:  Debra replied 2 years ago.
You mean CMHA. It is the government and this is why they can garnish her income tax refunds and benefits.This is a very difficult and complex situation.It is possible that the Court may be able to assist your spouse. First, there was no order that was voided by the bankruptcy and it may be that the former spouse did not list any debt to his former spouse as an debt to be extinguished by the bankruptcy. Second, bankruptcy doesn't extinguish support obligations so it is possible that the court would order that the former spouse make support payments to your spouse because of his breaching the agreement and letting her get stuck with the debt.
Customer: replied 2 years ago.

What if he did list the mortgage debt in his bankruptcy. Would that releive him of the reponsibility of the mortgage even if he started working full time right after?

Expert:  Debra replied 2 years ago.
It would extinguish his debt. He can declare bankruptcy while working. If he earned over a certain amount some of that would go to the creditors. So it may be that he is committing fraud and not reporting this income and should be paying something to the creditors. You could report this to the Trustee in Bankruptcy or to the bank.

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