Divorce often entails a trying time when it comes to distribution of property at a time of great emotional confusion. It becomes difficult to decide what is “yours”, “ours” or “mine”, but following certain guidelines could ease the process to a great extent.
The division of property in a marriage breakdown solely depends on the provincial law. As there are property division scheme for each province, the generalizations of property division law is limited in Canada.
In this article the common goals of property division as well as examining the practical aspects of property division are discussed. The scheme as enacted in Ontario in 1986 has been paid attention in particular here because of its comprehensive nature.
Marriage is an Economic Partnership
The goal of any property division scheme is to have equal distribution in whichever province or territory it is applicable. If not equally, it is the value of the assets that the couple acquired between the marriage date and separation or divorce date that is taken into account.
The “partnership” results after becoming legally married in Canada. The married couples are now subject to a more complex scheme of provincial property division that has a complex nature to it.
The complexity of property division schemes means relying heavily on legal advice and also taking the responsibility for locating, valuing, describing one’s personal marriage assets. There are certain time limitation in every province with its own cutoff date for making claim to property division and spousal support.
Definition of “Property”
There is a large variation of the definition of property among the different provinces. There could be distinction between the term “family assets” and “non-family assets” in different provinces. Usually, family assets refer to items that are often acquired and used by the family and include things like home, family car, joint bank accounts, furniture, cottages, and recreational equipment. The non-family assets include things like business interests of the spouses, special assets that were never brought to use by the family, inheritance, etc. In some provinces, distinction has been made between equally divisible assets and assets not divisible upon marriage breakdown.
Since 1986, no change has been made in Ontario between family and non-family assets. All property that belongs to either spouse is divided between the spouses after divorce, with limited exceptions.
Every province has its own exception list for assets that are not to be divided on marriage breakdown. There is a law in every province whereby a couple can exempt a property from division using a marriage contract. If it is agreed upon in the marriage contract that the matrimonial home will be spared in the event of a breakdown in marriage, the property would be exempt from sharing. It is important for you to ask your Property Division lawyer about the categories of exempt property that are applicable in your territory or province.