Division of Property
Whether married or cohabitating, a separation or divorce involves couples separating their commingled financial lives and separating their assets and debts.Equalization of net property
In order to resolve matters in a legally enforceable manner, which is in the best interest of both parties, they must sign a binding contract (separation agreement), obtain an arbitration award or obtain a Court judgment.
If parties choose to proceed to a judicial decision in Ontario (trial in Court or arbitration), the division of assets will be governed by the Family Law Act and caselaw. If parties are onboard with resolving matters amicably, they have the ability to think outside the box and reach an agreement that works for their family.
Once separated, married couples are entitled to an equalization of their net family property. This level of protection is afforded to married spouses pursuant to the Family Law Act. Essentially speaking, the right is not to the division of the property itself, but to the division of the value of the property. The equalization of net family property follows a specific calculation set out in the Family Law Act. The result of this process is that one spouse will owe the other a lump sum; the quantum of which depends on the situation at hand.
The division of property can be extremely complicated. Some issues include: valuation of real property (family home/matrimonial home), tax implications, exemptions, inheritance, gifts, pension division, stock options, business valuations, etc. Call us now to book a consultation with our experienced divorce lawyers.
Frequently Asked Questions
What happens if my spouse hid assets during our divorce proceedings?
If your spouse hid assets, the court can reopen the case once the hidden assets are discovered. Ontario courts take this matter seriously and your spouse could get penalised for this action.
Are business assets included in the division of property?
Yes, like we mentioned above, business assets are a part of division but may not be divided equally. The court will consider several factors when making a decision, including, the business’s value, who runs it, and whether dividing it would harm the business’s operations.
Does the division of property include debt?
Yes, debts acquired during the marriage, like mortgages or loans, are usually divided along with assets. However, debts taken on after separation or those not benefiting the family (like gambling debts) are solely the person’s share.
Can prenuptial agreements override property division laws?
Prenuptial agreements can impact how property is divided, but they aren’t always ironclad. If your prenup is unfair, one-sided, or drafted with improper legal advice, the court will void it.