“I have already found that there is no triable issue concerning the negotiation of this agreement. However, in Scheel v. Henkelman (2001) 2001 CanLII 24133 (ON CA), 52 O.R. (3d) 1 (C.A.), Borins J.A. pointed out that the test for the setting aside of a domestic contract under s. 56(4) of the FLA is more stringent than that for setting aside a waiver of spousal support because of unconscionability under s. 33(4)(a) of the FLA. He states that s. 33(4)(a) is directed towards the unconscionable results of a spousal support waiver as distinguished from an unconscionable agreement:
The use of the phrase “results in” in s. 33(4)(a) means that the subsection is not directed to unconscionable agreements, but to unconscionable results of a provision waiving support. An agreement which was fair and reasonable when it was signed, may, through circumstances that occur in the future, result in unconscionable circumstances at the time of a support application: Mance v. Mance (1981), 22 R.F.L. (2d) 445 (Ont. Co. Ct.); aff’d. (December 18, 1981), Cory, Jessup, Wilson JJ.A. (Ont. C.A.); Newby v. Newby (1986), 1986 CanLII 2616 (ON SC), 56 O.R. (2d) 483 (Ont. H.C.). As for an unconscionable agreement, it may be set aside under s. 56(4) of the FLA which is a codification of the general law of contract applicable to unconscionable agreements. It differs from s. 33(4), which operates in respect of valid and subsisting domestic contracts and enables the court to set aside a support provision, or a waiver of a right to support, in the contract where such provision “results in unconscionable circumstances”. In other words, s. 33(4) concerns unconscionable circumstances and not unconscionable agreements.
As set out in Scheel, unconscionability has been defined in a number of ways. It can be seen as being “shocking to the conscience of the court”, “harsh and unjust” or “improvident or unfortunate”: see para. 19 and 21 of Scheel. Borins J.A. suggested at para. 20 that the court consider three factors in determining whether the present circumstances are unconscionable:
(a) the circumstances surrounding the execution of the agreement, including the fact that each party was represented by competent counsel, the absence of any undue influence, the good faith and the expectations of the parties;
(b) the results of the support provisions of the agreement, including any hardship visited upon a party, and
(c) the parties’ circumstances at the time of the hearing including their health, employability and ability to maintain their life-style.”