After a relationship breakdown, spouses have the right to divide their property. If the spouses are married, then the property division takes place in accordance with calculations in the Family Law Act. If the parties were not married, the property is divided on common law principles of property ownership and equitable principles of trust. Therefore, both married and unmarried couples have claims to property rights once the relationship breaks down.
The property regime laid out in Part 1 of the Family Law Act is generally referred to as a deferred community property regime. This means that all property acquired during the course of the marriage by either party, with certain exceptions2, is deemed on the breakdown of the marriage, to be the property of both parties notwithstanding legal title.
According to Family Law Act Equal entitlement and responsibility:
81 Subject to an agreement or order that provides otherwise and except as set out in this Part and Part 6 [Pension Division],
Rights and remedies of third parties:
82 Nothing in this Part affects the rights and remedies of a spouse’s creditors, guarantors or assignees in relation to family debt.
The FLA has a broad definition of what constitutes property. Property is defined in section 4(1) as including any interest, present or future, vested or contingent, in real or personal property.
This can include, without limitation, the following items:
Marital property is property acquired after the parties are married. Property acquired before the marriage is considered the individual and separate property of the acquiring spouse and the court will have no authority to distribute individual property when the marriage is dissolved. However, if the property was inherited or given as a gift to one spouse from a third party, after the marriage, it is still considered separate property.
If you need help with dividing up property and assets or are unable to come to an agreement about how to divide property and assets, you can always have the court to decide how to divide property and assets. However, you must claim this within six years after legally separating from your spouse and within two years of finalizing your divorce with your spouse. The family home is a special place. It is where you live and where your children feel most comfortable. If you own your home, it may be the most valuable thing you own.
If you are married, both of you have an equal right to stay in your home unless a judge decides that one of you must move out.Since both of you have a right to stay in your home, neither of you can sublet it, rent it, sell it or mortgage it without the other’s permission. This is true even if your lease is in only one of your names or if only one of you owns the home.
The law in Ontario ensures that married spouses are required to equally divide all of the property a couple acquired during their marriage. In this situation, in the eyes of the law in Ontario, it doesn’t matter who is paying for things or whose name the matrimonial home is in. The value of the matrimonial home is equally divided between spouses even if one spouse owned the matrimonial home before marrying their spouse.
The money that the spouse with the higher total has to pay the spouse with the lower total is called an “equalization payment.” The purpose of an equalization payment is to put both spouses in an equal position. The result is that both spouses end up owning the same total value of property.
There can be many issues about the value and ownership of a spouse’s assets. There may even be issues about the amount of the equalization payment. In some circumstances, such as a marriage of less than five years duration, the court can order a lesser payment to prevent an unconscionable result.
If spouses are applying for equalization as the result of separation, death, or divorce, they must apply to the Superior Court or Unified Family Court for equalization before the earliest of: 6 years from the date of the separation; 2 years from a declaration of divorce; or 6 months from the other spouse’s death.
Dealing with assets and agreements can be challenging when a relationship comes to an end. You can ensure that every detail is looked after by working with our lawyers which specializes in family law and the division of assets in Mississauga. In addition, our team is experienced in assisting clients with high net worth divorces, where parties might own businesses or valuable properties that require specialized attention. You don’t have to figure out the law on your own, however. Consider speaking with an experienced divorce attorney near you and learn about your options.
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