Division Of Assets And Debts

The law regarding the division of assets and debts in the Family Law Act applies to all "spouses" whether legally married or common law.

The general rule under the Family Law Act is that each spouse has a right to a half interest in all "family property" and is equally responsible for all "family debt" regardless of the contribution or use of each spouse in relation to that property or debt.

In general, property is "family property" if one spouse owned it or had a beneficial interest in it on the date the spouses separated and it is not included in the list of excluded property set out in s. 85 of the Family Law Act. Examples of excluded property include property owned by one spouse before the relationship began, inheritances, gifts and property held in discretionary trusts. However, the increase in value during the relationship of property purchased before the relationship or the income received from such property during the relationship may be "family property" even if the original property was not. Determining what is and is not "family property" can be quite complicated.

Generally "family debt" includes all financial obligations incurred by a spouse between the date the relationship began and the date of separation. A debt incurred after separation may also be a "family debt" depending on the purpose for which it was incurred.

The Family Law Act specifically states that the provisions in it regarding the division of assets and debts are subject to a written agreement. Examples of such agreements include a marriage agreement entered before legal marriage ("pre-nup"), a cohabitation agreement entered into before a couple became common law spouses, or a separation agreement entered into after separation. However, the Court still has the jurisdiction to set aside part or all of an agreement. It is important to ensure that your agreement meets the requirements of the Family Law Act and common law and is drafted to minimize the possibility that it will be set aside by the Court at a later date. We would be happy to assist you with this.

To arrange a free initial telephone consultation to obtain more information on the division of assets and debts or to arrange a meeting with a lawyer to discuss your particular circumstances please contact us at (604) 523-7090 or email booth@cassadylaw.com