After separation or divorce, you will need to move forward with the division of matrimonial properties. There is a certain limitation period issue so please start your action for division of matrimonial property as soon as possible. As for more specific information about the limitation issue, please consult with a lawyer.
The division of matrimonial properties can be dealt with by way of negotiation, mediation, arbitration and/or trial. You can deal with divorce first and then to deal with the property issue at a later date or you can deal with divorce and property issue at the same time. It depends on your circumstances so please consult with a lawyer.
It may be possible to reach a settlement agreement between you and your spouse; however, we strongly suggest that you contact a lawyer to ensure that the settlement agreement is legally enforceable. Your draft agreement may not have sufficient information if done by yourself, our family lawyers are experienced and knowledgeable in this area and can assist you with any concerns you may have.
If an agreement cannot be reached, you or one of our Calgary Family Lawyers can file a Statement of Claim for Division of Matrimonial Property and/or a Court application for constructive trust.
Property Division for Married Couple vs Unmarried Couple
Married Couple
In Alberta, the division of Matrimonial Property is governed by the Matrimonial Property Act of Alberta (MPA). The MPA states that everything you and your spouse had acquired during the course of your marriage is qualified as matrimonial properties and can be divided. There can be exceptions and exemptions to the general rules as specified in MPA. Our lawyers are experienced in identifying these properties to help creating the best possible settlement for our clients.
Unmarried Couple
A common law relationship is described as two people who are living with each other with a marriage-like relationship for more than three years or have a child together. Sharing finances, publicly identifying themselves as a spouse or partner will identify you as a common law relationship. If you are categorized as a common-law relationship, MPA does not apply to your situation. The division of common law property is complex and can be divided based on a variety of factors, such as length of the relationship and the nature of the contribution.
Unmarried cohabitants’ options are limited to unjust enrichment, law of trusts, law of contract. A trust arises when one party holds property for the benefit of another.
Constructive Trust – a trust created and imposed by the court as a remedy.
Resulting Trust – Common intention necessary to establish beneficial entitlement to matrimonial property owned only by one spouse, but intention rarely actually expressed by parties
ASK YOURSELF: do the parties’ conduct imply their intention to divide the property in a certain way?
What are Considered Matrimonial properties?
The division of properties can be complex and confusing. The first step in this process is identifying the list of assets and liabilities.As stated by the Centre for Public Legal Education Alberta (CPLEA), there are certain types of properties that are considered by the court to be divided and may include but not limited to:
- Real Estate
- Pensions
- Investments
- Furniture
- Cars
- Family home
- Vehicles, recreational vehicles
- Shares, stock options
- Air Miles, Shoppers Drug Mart points
- Works of art, collections
Other miscellaneous items like gifts, jewelry, tools and/or debts from families may also be divided between the partners. The division of these assets will be the current value of the property as long as the individual can trace the asset with some type of financial statement or real estate appraisal.
Matrimonial Property will include:
- Household goods – personal property that is owned by one or both spouses, and that was ordinarily used by one or both spouses or children.
- Matrimonial Home – property that is owned or leased by one or both spouses, that is or has been occupied by the spouses as their family home
Matrimonial Property includes things that were obtained by the spouses at the time that they were married to each other.
What are Exempt from Matrimonial Properties
There is a common misunderstanding where people believe that every property will be divided upon a divorce but this is not true. Not every property will be divided, for instance any property that was previously owned by the spouse prior to being married will be exempted from any matrimonial property divisions. Exceptions may include (but not limited to):
- Property that was gift from a third party
- Any property that was inherited
- Awards or settlements from an insurance policy
To be exempt for any of the assets above, the individual will need to trace the asset. If the asset cannot be proven legitimate, then the exemption may not apply to your situation.
How are the Properties Divided?
The division of property may be straightforward unless some complex issues present itself such as one of the spouses not agreeing towards the division of an asset. Other factors that may affect how the properties will be divided may include whether or not the partners have had a prenuptial, post-nuptial or cohabitation agreements.
To proceed forward, you should create a list of traceable assets, banking information, financial statements and purchases that you want to discuss during your settlement.
The Section 8, Matrimonial property act explains how properties are divided during a divorce:
- Contribution made by each spouse to the “welfare of the family,” including as a homemaker or parent
- Financial or other contribution by a spouse to acquisition, management or improvement of business run by one or both spouses, or run with another person
- Income, property and other financial resources of each spouse at the time of marriage AND at the time of trial
- Length of marriage
- Whether sharable property acquired after separation
- Agreements between spouses
- Spouse’s substantial gift of property to third party
- Spouse’s transfer of property to a third party other than a bona fide purchaser for value
- Previous division of property between the spouses
- Prior Court Orders
- Tax liabilities incurred by a spouse as a result of the transfer of
sale of property - Spouse’s wasting of property to the detriment of the other spouse
- “Any fact or circumstance that is relevant”
How Long Will The Property Division Process Take?
The length of the property division process can vary depending on the circumstances. It could take a few months if there is an agreement or several years if there is no agreement but resort to a trial.
How can I Protect My Assets Before Marriage?
Having Prenuptial agreement created by our lawyers to address certain conditions if a marriage were to fail is a great protection method.
Preparing Trust – so that the property is in the name of a trustee (essentially, the trustee owns the property, but you continue to benefit from using the property)
However, trusts should be in place BEFORE marriage. There is case law in Alberta where the use of a trust was challenged and it was found that trusts can’t be used to defeat a matrimonial claim.
Consider having both the protection of a prenuptial agreement and preparing a trust.
What is a Certificate of Lis Pendens?
A certificate of Lis Pendens is a notice of ongoing legal proceedings or pending legal action as to the ownership of a particular piece of land or other real property.
The Certificate of Lis Pendens is registered at the Alberta Land Titles Office. If a land with a certificate of Lis Pendens is transferred, the Certificate of Lis Pendens affects the new title. Most lenders or potential buyers will not buy a real property that has a Certificate of Lis Pendens on it.
For example, a husband and wife are going through a divorce and are attempting to reach a Settlement Agreement. Both husband and wife agree to sell the matrimonial home, but
do not agree as to how to divide the proceeds.
Both parties can put Certificates of Lis Pendens on the title to prevent the other party from proceeding with the sale of the property without having a clear agreement as to the division of the proceeds of the property.
How can I start legal actions regarding
Matrimonial Property?
Prepare either one of these two originating court forms and file at the courthouse:
- FL02 – Statement of Claim for Division of Matrimonial Property
- FL03 – Statement of Claim for Divorce and Division of Matrimonial Property
Serve the filed court form to the opposing party – The opposing party then has 20 days to respond if they are served in Alberta, 1 month if served outside Alberta but in Canada, or 2 months if they are served outside of Canada.
How can our Calgary Property Division Lawyers help you?
Our Calgary Family Lawyers are experienced in property division and have numerous successful settlements for our clients. We will help you prepare a list of assets and exemptions for your property division list to ensure that you have the best outcome for yourself. To meet with our Calgary Family Lawyers, please book a consultation online or call us at (403) 476 – 2011.
