A former client is suing Fasken Martineau DuMoulin LLP for $3 million, claiming the firm and two of its former lawyers were professionally negligent. Lisa Niblett retained lawyers Anthony VanDuzer and Catherine Binhammer in 1987 to help with a marriage contract between her and her future husband, David Niblett. After Niblett started divorce proceedings in late 2015, she alleges it became apparent that the contract was one-sided, and would result in her husband keeping most of his net family property.
Niblett claimed that the lawyers were professionally negligent and breached their contractual and fiduciary duty to her. “The defendants failed to inform Lisa that the contract was unfavourable to her while benefiting David, and that no consideration was given for the entitlements she would receive under the contract,” the statement of claim said. She alleged they failed to advise her about the statutory entitlements she was giving up through the contract that she would have received under the Divorce Act and the Family Law Act.
“They failed to warn Lisa adequately or at all, about the changes in her financial circumstance that could arise from childcare responsibilities, and exit from the workforce, the economic dependency related to the marriage, and as well, from the contingencies of life including illness and disability — all of which are factors affecting Lisa today,” said the statement of claim.
Niblett and her husband, David, married in September 1987. Shortly before their wedding, Niblett’s husband told her she would have to sign a marriage contract and that she would need a lawyer to review it.
Niblett’s mother suggested VanDuzer, who was a distant cousin. VanDuzer mainly practiced corporate and commercial law at the firm, which was called Fasken & Calvin LLP at the time. He later left the firm and is now a professor at the University of Ottawa.
VanDuzer delegated the contract matter to Binhammer, who was an associate at Fasken.
Binhammer’s review of the contract resulted in some changes, but Niblett argues none of them “focussed on the essential elements of the contract, or on the important releases of claims,” which would likely affect her. Niblett claimed the changes requested in the review “were on the periphery of the agreement”.
She signed the contract two days before her wedding.
Niblett initiated divorce proceedings in late 2015 after she discovered her husband had allegedly been having an affair with a younger woman.
When Niblett met with matrimonial counsel about the divorce, she had a vague recollection of signing a contract, but did not remember the details, said the statement of claim.
Her husband had kept her copy of the contract in a safety deposit box, and did not provide a copy to Niblett’s lawyer until Jan. 2016.
By agreeing to the contract, Niblett essentially signed away her rights to lump sum spousal support, as well as her right to make claims in equity. It also disentitles her from receiving equalization of net family property and provides her husband with a credit of $300,000 upon the sale or buyout of the couple’s home on separation.
Under the terms of the contract, Niblett’s husband retains most of his net family property, which is estimated at $7 million, according to the statement of claim. Niblett’s net family property was calculated at just over $1 million. Niblett will end up receiving around $1.5 million for her interest and share in two properties.
Niblett’s lawyer argued in the claim that this amount was severely less than what she would be entitled to under the Divorce Act and the Family Law Act. If there were no contract, she would have received an amount closer to $3 million, in addition to the $1 million she had at the date of separation.
When she started her divorce claim, Niblett requested spousal support, equalization of net family property and sought a court order setting aside the marriage contract.
She had worked until 1992, when she focused on raising their two children. The couple were married for 28 years and had three homes, which included a primary residence in Toronto, a cottage in Muskoka and a ski chalet in Collingwood, Ont.
Niblett’s statement of claim against Fasken and her former lawyers said that before meeting with her matrimonial lawyer in 2016, she was unfamiliar with the provisions of the Family Law Act dealing with property and she did not understand how equalization of net family property worked.
She also did not understand the provisions of support pursuant to the Divorce Act or her entitlements to seek lump sum spousal support.
In their statement of defence, Fasken and the defendant lawyers said they had fully explained Niblett’s legal rights to her, as well as the extent to which she was compromising her entitlements under the contract.
“The defendants advised Ms. Niblett that the draft marriage contract was contrary to her interests and urged her not to sign it,” the statement of defence said.
They said that Niblett simply chose not to follow the advice that they gave her. Niblett was insistent on signing the contract, despite the terms that were against her interests, they claimed.
When the retainer was discharged, the defendants asked Niblett if she was under any pressure to sign the contract, but she said she was not, according to the statement of defence.
Susan Sack, who is acting for the defendants, declined to comment, as the case is ongoing.
Fasken and the lawyers also argued that Niblett’s claim was brought after the applicable limitation period had expired and therefore should be summarily dismissed.
In her reply to the defence, Niblett argued the action had been commenced within the limitation period.
Lawyer Julie Hannaford, who is representing Niblett in the matter, declined to comment as the family law case between the plaintiff and her husband is in private mediation and arbitration.