In Canada, matrimonial property is presumptively divisible on a 50/50 basis. This means that the default for dividing property when separating is equally. There are factors that can affect that division. The first are exemptions, which are covered here. The second is the mitigating factors that courts can consider in order to divide on an unequal basis. Courts are entitled to divide property on an equitable basis, taking into consideration the mitigating factors
Generally, the factors which courts can consider are as follows:
- Contributions made by each spouse to marriage and family, including unpaid/non-monetary things such as homemaking;
- Contributions, monetary or otherwise, made by each spouse to business, farm, or other enterprise owned by the spouses, solely or together, or by another party;
- Contributions, financial or other, made by each spouse to a property;
- Each spouse’s earning capacity, financial resources, and other liabilities
At the time of marriage; and
At the time of trial;
- The marriage length;
- Any property acquired while spouses were living apart;
- Any terms of an oral or written agreement between the spouses;
- Any transfers of property, or gifts of property to a third party, including parties who are not bona fide purchasers;
- Any interim or previous divisions of matrimonial property;
- Prior court orders;
- Tax liabilities incurred by either spouse as a result of transfer or sale of property;
- Any dissipation of property made by one spouse to the detriment of another; and
- Any other relevant factor or circumstance.
As you can see, there are significant factors for a court to consider when dividing the property. For separating spouses, the factors should guide how you divide your property. The factors also serve as a “what not to do” guide for dealing with your property in the wake of separation. Courts are live to issues such as depleting or dissipating shared property to spite a former spouse. They are also familiar with undervalued transfers of property or transfers to family members in order to frustrate property division.
If you are not going through the courts, these factors will likely be less important to your divorce. You will likely be dividing property 50/50 without any complicating factors. However, you should keep them in mind as you divide property in a fair and equitable manner.
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