Property/Asset Division

When you and your married spouse separate, there is recognition for each parties’ contributions to the family throughout the marriage. Property acquired throughout the marriage that exists upon separation is divided equally between both parties. There are exceptions for certain types of property, but it is always best to consult a lawyer in reviewing what property is divisible, and whether any exceptions apply. If one spouse owns property prior to marriage (excluding the matrimonial home) that property may not be included but the increase in value throughout the marriage may be subject to equalization. The payment one spouse owes to the other spouse is referred to as an Equalization payment and the value of the Equalization payment is determined by evaluation each spouse’s Net Family Property. In certain cases, there may be property that can be excluded from such equalization because, for example, it was a valid gift or an inheritance. In other special cases, an ‘unequal’ division of the Net Family Property may be appropriate.

When a married couple separates and either one or both spouses have a pension plan, each spouse has an interest in the other spouse’s pension for the contributions made during the course of the marriage. The value of one spouse’s interest in the other’s pension is determined by the period of time between the date of marriage and date of separation, and the valuation of the pension within that period as prepared by the pension administrator. It is possible for a spouse to waive their right to an interest in the other spouse’s pension, but it is strongly recommended that one speak with a lawyer before deciding how to proceed where pensions are involved.

The Family Home is also referred to as the Matrimonial Home, meaning that you lived as a family within the home whether you had children or not. The Matrimonial Home is treated as a special asset by law. When married couples separate, each party is entitled to their share of the Matrimonial Home regardless of whether title is held by one party only. Parties may choose to ‘dispose’ of the Matrimonial home by either selling it and dividing the proceeds, or having one spouse purchase the other spouse’s interest. The second option often includes the need to refinance the home in one party’s name alone, in which case mortgage lenders may require that a finalized Separation Agreement is in place to assess whether that person will qualify.

Property division upon separation can be extremely complex and difficult to handle on your own. If you’re living as common law spouses and are not legally married, the information above may not apply to you.

Disclaimer: The information contained within these pages is general information only. Each matter is unique and the information contained within these pages may not apply to your situation. You should always seek legal advice to review your individual matter.