“Within Ms. Cobbina’s helpful summary of the relevant law applying to s. 56(4) and attempts to set aside domestic agreements (virtually all of which is apt and most of which I will not repeat here), she cites McGee J.’s insightful and helpful summary of the principles guiding the analysis in Harnett v. Harnett, 2014 ONSC 359 (at paras 87-94).
Citing various authorities, Her Honour notes:
(a) As a general rule, courts will uphold the terms of a valid enforceable domestic contract;
(b) It is desirable that parties settle their own affairs…and courts are generally loathe to set aside domestic contracts;
(c) Parties are expected to use due diligence in ascertaining the facts underlying their agreements. A party cannot fail to ask the correct questions and then rely on a lack of disclosure;
(d) A domestic contract will be set aside when a party was unable to protect his or herself. Such cases are generally predicated upon a finding that one party has preyed upon the other or acted in a manner to deprive the other of the ability to understand the circumstances of the agreement;
(e) The court is less likely to interfere when the party seeking to set aside the agreement is not the victim of the other, but rather his or her own failure to self-protect. The Ontario Court of Appeal in Mundinger v. Mundinger… says that the court will step in to “protect him, not against his own folly or carelessness, but against being taken advantage of by those in a position to do so because of their position”;
(f) The court must not look at which party made the better bargain but rather, to whether one party took advantage of their ability to make a better bargain. In that taking of advantage is to be found the possibility of unconscionability;
(g) The test for unconscionability is not weighing the end result, but rather the taking advantage of any party due to the unequal positions of the parties;
(h) The onus is on the party seeking to set aside the domestic contract to demonstrate that at least one of the circumstances set out in subsection 56(4) has been met; then the court must determine whether the circumstances complained of justify the exercise of the courts discretion in favour of setting aside the contract. It is a discretionary exercise.”