What are the differences between married and common-law spouses when it comes to the matrimonial home and other property?

Answer: While married and common-law spouses share many of the same rights and responsibilities, this is not the case when it comes to the division of property upon the breakdown of the relationship. Married spouses have legal rights and responsibilities with respect to dividing property that are not available to common-law spouses.

Marriage is considered to be a partnership, with each spouse making equal, if different, contributions and sharing equally in the family’s property if the partnership ends. This includes property acquired during the years of the marriage even if some of it has been paid for by only one spouse or is registered in the name of only one spouse. It also includes debt, which is considered to be family property, including debt incurred by only one of the spouses (eg a personal line of credit or a credit card).

With respect to the matrimonial home, its full value must be shared equally between the spouses, even if it was acquired and paid for before the date of marriage. In other words, if one spouse owns a house and, upon marriage, the other spouse moves into that house, its full value, not just the value that accumulated during the years of marriage, is shared equally between them if the marriage ends.

This is unlike other family property, where only the value acquired during the years of marriage has to be shared.

There is some property that is excluded from the equalization requirement, including inheritances and gifts.

Family property that must be divided upon marriage breakdown includes:

  • house, cottage or other real estate
  • cars and other vehicles
  • personal items (clothing, books, jewellery)
  • household items (furniture, appliances)
  • money (bank accounts, RRSPs, investments)
  • pensions
  • debt

Family assets and debts are totaled, and debts subtracted from assets to calculate “net family property,” which is then divided equally. This can be a complicated calculation, depending on the extent of the property and especially if there are differences of opinion between the two spouses about the value of items they own or the date of separation.

A claim for equalization of family property must be started within 6 years of the date of separation and 2 years of the date of divorce.

Common-law relationships do not provide an automatic right to an equal sharing of the property.

People leave a common-law relationship with what they brought in plus whatever they can prove they bought during the relationship. In order to receive a share of property accumulated over the course of the relationship, the common-law spouse would have to prove to the court that she has made contributions, direct or indirect, to its value.

Direct contributions could include paying a share of the mortgage or paying for renovations or repairs to the home. Indirect contributions could include paying for utilities, household expenses or family vacations, raising the children or assisting in the family business.

While some provinces have taken steps towards creating the same statutory regime for division of property for common-law and married spouses, no such regime exists yet in Ontario. A recent Supreme Court of Canada decision upheld Quebec’s regime that does not provide for any rights to support or division of property for common-law spouses (Quebec (Attorney General) v A. 2013 SCC 5).

Married spouses can opt out of the statutory requirement that they share property equally through a marriage contract and common-law spouses can create a requirement for themselves that they share property equally through a cohabitation agreement.

The issue of property division may be used by an abuser to intimidate or harass his partner. He may lie to her about the extent of family property, maintain secret bank accounts, run up debt without telling her, forge her signature on bank documents such as mortgages, etc. He may refuse to provide the required information in his family court financial statement or may try to persuade her not to pursue her legal rights to property.

For these reasons, it is very important that women know their legal rights. A very helpful resource is the National Association of Women and the Law (NAWL) “A Women’s Guide to Money, Relationships and the Law in Ontario , which is available on the NAWL website at www.nawl.ca/money. It can be read online, downloaded, printed or listened to in a podcast.

December 2013