Matrimonial Property Rights

• Author: Julien D. Payne, Marilyn A. Payne
• Pages: 652-716

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  

Matrimonial Property Rights

A. PROVINCIAL AND TER RITORIAL LEGISLATIVE

DIVERSITY

Over thirty years ago, the Supreme Court of Canada in Murdoch v Murdoch

concluded that a wife who had worked alongside her husband in the elds

was not entitled to any interest in the ranch that had been originally pur-

chased with his money. Her homemaking role and hard physical labour on

the farm counted for nothi ng. Several years later, the Supreme Court of Can-

ada saw the error of its ways and i nvoked the doctri ne of unjust enrichment

to enable wives and unmarried cohabitants to share in property acquired

or preserved by their partners during cohabitation. In the meantime, prov-

incial legi slatures introduced statutory reforms to amel iorate the harshness

of the Murdoch v Murdoch decision so far as mar ried couples are concerned.

Every province and ter ritory in Canada has enacted legislation to estab-

lish property-sharing r ights between spouses on marriage breakdown or di-

vorce and, in some provinces, on death.

 (),  RFL  (SCC).

 Rathwell v Rathwell (),  RFL (d)  (SCC).

 Pettkus v Becker, []  SCR ,  R FL (d) ; Sorochan v Sorochan,[]  SCR .

And see Chapt er , Section E.

 See Matrimonial Property Act, RSA  , c M-; Family Law Act,SBC  , c , Part ;

Marital Property Act, CCSM c M ; Marital Property Act, SNB , c M-.; Fam ily Law

Act, RSNL , c F- , Part I (Matrimon ial Home), Part II (Matr imonial Asse ts), Part

IV (Domestic C ontracts); Matrimonial Property Act, RSNS  , c ; Family Law Act,

SNWT , c , Par t I (Domestic Contract s), Part III (Family Pro perty), Part IV (Fam -

ily Home); Family Law Ac t, RSO , c F., Part I (Famil y Property), Part II ( Matrimo-

nial Home), Part I V (Domestic Contract s); Family Law Act, SPEI , c  , Part I (Family

Property), Par t II (Family Home), Part I V (Domestic Contract s), Civil Code of Québec,

Chapter : Matrimonia l Property Rights

ree fundamental questions require consideration in any attempt to

divide property between spouses on the termination of their relationship.

ey are as follows:

) What kind of proper ty falls subject to div ision?

) How is the property to be va lued? and

) How will the sha ring of property be achieved?

In some provinces and territories, a wide judicial discretion exists and

distinctions are drawn between “family assets” that both spouses use and

“business” or “commercial” assets that are associated with only one of the

spouses. In others, no such distinctions exist. In most provinces and ter-

ritories, the courts are empowered to divide specic assets. In Onta rio, it is

the value of property, as di stinct from the property itself, that is shared; al l

assets must be valued a nd each spouse is presumptively entitled to an equa l

share in the value of t he assets acquired by either or both of them.

Provincia l and territorial matr imonial property stat utes usually exclude

premarital a ssets from division and also certain postmar ital assets, such as

third-party gifts or inheritances and damages or monetary compensation

received by a spouse from a th ird party as a result of personal inju ries.

Statutory propert y-sharing regimes are not dependent on which s pouse

owned or acquired the assets. Prior to marriage breakdown, however, the

control and management of an asset is le gally vested in the owner. Provi ncial

and territorial statutes, nevertheless, prohibit a title-holding spouse from

disposing of or encumbering the matr imonial home without the consent of

his or her spous e.

Because the relevant provincial and territorial statutes dier markedly

in content and approach, it is impossible to provide a comprehensive analy-

sis of the diverse provincial matrimonial property regimes in the following

pages. e authors will consequently focus on the Ontario statute, which

represents the most comprehensive provincial legislation on matrimonial

property rig hts in Canada.

SQ , c , Book  ; Matrimonial Property Act, , SS , c M-.; Family Property

and Support Ac t, RSY , c , Par t I (Family Asset s), Part  (Family Home), Part ,

ss  and – ( Domestic Contracts). Many of t he aforementioned statut es have been

amended from t ime to time. As to First Nat ion communities choosi ng to create their

own matri monial real prope rty laws, see Family Home s on Reserves and Mat rimonial

Interests or Rights Ac t, SC , c .

  

) Introduction

In , the province of Ontar io enacted the Family Law Reform Act to amel-

iorate the hardship and injustice arising under the doctrine of separation

of property, whereby each spouse retained his or her own property on the

breakdown or dissolution of m arriage. Section  of the Family La w Reform Act,

 empowered a court to order a division of “family assets” and, in excep-

tional circu mstances, a division of non-fa mily assets on mar riage breakdown,

regardless of which spouse was the owner of the assets. General ly speaking,

a non-owning spouse would be granted an equal share of the family assets,

which included the matrimonial home and other assets ordinarily used or

enjoyed by the family, but no interest in business a ssets would be granted to

the non-own ing spouse.

As of  March , Part I of the Family Law Act eliminated the former

distinction bet ween “family asset s” and “non-family assets” by providi ng for

an equali zation of the value of all assets accumul ated by either spouse during

the marr iage in the event of marriage break down or death.

) Objectives of Family La w Act

In general terms, the fundamental objective of Part I of the Family Law Act

is to ensure that on marriage breakdown or death each spouse will receive

a fair share, which will usually be an equal share, of the value of assets ac-

cumulated during the course of matrimonial cohabitation. us, subsection

() of the Family Law Act provides as fol lows:

() e purpose of this section is to recognize that child care, household

management and nancial provision are the joint responsibilities of the

spouses and th at inherent in the marital re lationship there is equa l contri-

bution, whether nancial or othe rwise, by the spouses to the assumption

of these responsibilities, entitling each spouse to the equalization of the

net family properties, subject only to the equitable considerations set out

in subsection ().

is provision does not empower a court to deviate from the norm of equal div-

ision in the absence of circumstances that just ify a nding of unconscionability

 SO , c .

 RSO , c F.. For proposed changes, se e Ontario Law Refor m Commission, Rep ort

on Family Propert y Law (including E xecutive Summa ry) (Toronto: Ontario Law Refo rm

Commission,  ); see also Ontar io Law Reform Comm ission, e Rights and Re-

sponsibilitie s of Cohabitants under the Fami ly Law Act (includ ing Executive Sum mary)

(Toronto: Ontario Law R eform Commission,  ).