Does a legal separation protect me against my spouses growing debt?

Answer: Yes, subject to the following comments.

First, the date of separation must be proven. This date can be before a separation agreement is signed. If, for example, you retain a lawyer and a lawyer’s letter is sent to your spouse confirming that you are separated, then unless you reconcile that should be the date of separation, at the latest.

Second, the date of separation is also the valuation date. All of your property rights are “frozen” as of that date. So, as a matter of theory, if your spouse spends $10,000 on a gambling addiction the day after you separate, this is no longer a family debt. In short, it is his problem, when the overall equalization of net family property calculations are made. However, a word of caution. Even if you separate, more is needed to protect you from responsibility for debts that are owed to third parties. For example, if he uses a joint credit card or joint line of credit, then you still have a contractual obligation toward the “innocent” third parties, such as the credit card company and grantor of the line of credit. You can seek reimbursement from your spouse for the amounts used/incurred after the date of separation; however without more this does not protect you from liability to these third parties. Additional steps would be needed, such as a letter from a lawyer to such third parties prior to your spouse incurring new debts, alerting them to the separation and advising them of specific legal positions.

You are welcome to call me at: (877) 668-9386 for a free consultation, and I can then provide specific guidance to you, once I know the unique facts of your case.

(The information provided above is general, not legal advice, as circumstances vary from case to case. Thus, if you wish legal advice that you can rely upon for your specific case, please contact Douglas Briand for a free consultation).