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Dividing Assets under the Family Relations Act Family Assets
Family Debts
I have a registered divorce order within which is a clause regarding a vested pension split. My ex has not completed this requirement and does not respond to my request, in writing, to do so. How do I get back to Court to request the Court to enforce the order? (by P of Bowen Island, BC) First, before you go back to court and spend more money, try sending a certified true copy of the court order to the administrator of your husband's pension plan. The administrator may very well solve your problem for you, although he or she may send you some forms to fill out. This could be the easiest way to solve your problem. If you must go back to court, your application should be for "a finding" that your husband is in contempt of court. His failure to follow the terms of the order - if, in fact, he has failed to obey the order - constitutes contempt of court, the wilful disobedience of an order of the court. Contempt of court is both a criminal and a civil offence, and the court has the inherent power to punish those who disobey it. You may also wish ask the court for an order directing the administrator of your husband's pension plan to take such steps as may be necessary to vest your share of his pension in yourself. I strongly recommend that you check the terms of the order carefully, and maybe do a little research into the division of pension plans between spouses. In many cases, the spouse of the pension plan member will not be entitled to receive his or her share of the pension until the member retires or is eligible to retire.Click here to go to the top of the page. My wife and I have been living separate and apart for more than a year. In that year I have been solely responsible for maintaining and paying for our house. I understand that all equity up until the time of separation is equally shared but does she have the right to equity I have added as a result of her leaving? (by D of Surrey, BC) The way it works is this. There is a presumption that you and your spouse are each entitled to one half the value of all family assets. The "value" of those assets is usually assessed at the date of trial. Now the presumption is just that, a presumption; it can be rebutted. Among the factors which might rebut the presumption, so that one party gets a bit more of the family assets than half, are: the length of the marriage; each party's relative contributions to the assets; how the assets were acquired, and so forth. From what you've said in your email, it seems that you might have an argument that you should receive credit for the money and labour you've put into the house since separation. I think that this is the tack you should take. Click here to go to the top of the page. My wife left me in March 1999. I bought the home we had been renting in September 2000. She bought a home with her new partner in December 2000. Does she have a legal share in my home in Kamloops for division of assets purposes? She is not on the title for the house and the mortgage does not mention her as an interested party to the mortgage. She has registered a Lis Pendens on this home as of June 2001. So, is she entitled to a share in it if sold? We began renting it in September 1996. (by S of Kamloops, BC) Okay, this may be a bit complex; bear with me. Your wife may have an interest in the home depending on the source of the funds you used to acquire the house. If, for example, you had RRSPs during the marriage which you used after separation to buy the house, your wife may have a claim to a share of your RRSPs which means - following the money - she may have a claim to a share of the house you bought with them... but only to the extent of her share in the RRSPs. If you used a family asset (family assets are subject to division between spouses) to buy a new asset, she'll have a share in the new asset to the extent of the share she would have had in the family asset. As far as her lis pendens (a "certificate of pending litigation" or "CPL") is concerned, all that is is a notice to potential lenders or buyers that the property at issue is subject to a possible change in ownership. A CPL alone doesn't give her an interest, the CPL just stops the house from being sold or used as collateral until trial to protect her potential interest in the home. One last note. Say you used $50,000 of family assets to buy your house, worth $100,000. If, at trial, she is found to have a 50% interest in the family assets you used to buy the house, her interest in the home would be $25,000. This doesn't mean you'll lose your house. If you can buy her interest out, that should satisfy the order (unless it states otherwise). Failing that, the usual recourse is to sell the house, and you would pay her the $25,000 out of the net sale proceeds. Click here to go to the top of the page. My spouse and I separated almost a year ago. He is living in the family home and up until recently, we each drew from a shared bank account. We have shared 50/50 custody of our daughter. We separated our finances and our combined mortgage/rent is $1800. I pay half, he pays half and we split the life insurance, RESP contribution for my daughter. He is living in our $500,000 family home and I live in a rented mobile. He makes approximately $30,000 more per year than I do and I am finding it hard to make ends meet while he seems to be doing quite well. Considering that he makes about 30% more a year than I do, is there anything governing shared expenses for our daughter and the mortgage vs. income levels? (by B of Maple Ridge, BC) You actually have a couple of options. Firstly, "special expenses", like your daughter's school costs, for example, are normally shared between spouses at the ratio of each parents' income. If he makes $75,000 and you make $25,000, you'd pay 1/3 of all costs and he'd pay the other 2/3. Child support can also be adjusted in this way. In the case of child support, the usual course of action where the parent's have a 50/50 arrangement is like this: the higher earner pays child support to the lower earner, minus what the lower earner would have to pay to the higher earner in child support. His child support obligation to you would be set off by your obligation to him. For example, if he would owe you $400 per month in support under the Guidelines, and you'd owe him $150 in support, he'd pay you his amount less your amount, or $250. Now, as far as the family home is concerned, it seems like your situation is a bit unfair. Unless there are some other factors that you haven't mentioned, you could:
The applications I've referred to above are a bit complex. You really should hire a lawyer if you're thinking about making an application like this. Click here to go to the top of the page. My wife and I are currently going through a separation and have run into a problem. We purchased a car a year ago and I was making all the payments. The Car was setup in her name and the loan for it was in both of ours. Since we split up she has the car 100% of the time and I am paying half of the loan. I need my own vehicle but the only way to pay off the loan is to sell it and pay the remainder at time of sale. Being as she has complete ownership of the car and I have no access to it do I have rights to transfer the remainder of the loan into her name and have mine taken off? (by B of Delta, BC) As you can probably imagine, banks like loans that are co-signed or guaranteed by a third-party because it increases the likelihood will that the loan will be repaid if the primary debtor defaults. You can ask that the loan be transferred into your name, but you're at the mercy of the lending institution. Even if you took this to court, the best order you could get would that your ex "save you harmless" from any liability from the loan, in other words, that she make good any financial harm that may come to you from the loan. The court cannot make an order compelling a third party (the lending institution) to do anything, like take your name of the loan. Click here to go to the top of the page. If a husband refuses to maintain a steady job and will not contribute to any family expenses (mortgage, food, or any expenses at all) and he is not on the mortgage documents and has not contributed to any savings etc., is he entitled to 50% of the assets? (by L of Langley, BC) As I've described things in the section on my website dealing with family assets, there is a presumption that he is entitled to half all family assets. Of course, that's all it is: a presumption. The court will consider a lot of factors in deciding whether there should in fact be an equal split or whether you should get more than he. The things you've detailed in your email suggest to me that you might be able to claim a reapportionment of the family assets in your favour based on your greater contribution to the household and his lesser contribution. This is certainly an argument you can use in court or during settlement negotiations. Click here to go to the top of the page. My husband and I were together for thirty years, married for the last twenty. I quit my career path to move to the wilderness with him and raised three children while he worked. Because I do not have the education I should, I am working for a very slim salary at a small school, and glad to have the work because so many teachers are being laid off here. When he left, he took all his work equipment, and left the house to me because it was in my name. Since then, he has sold all his equipment, and he has only offerred to support me for two years. We are both in our early fifties. Should I not expect that he should give me more than two years of support after thirty years of serving him while he worked to increase his income? Will he be able to take my house? (by J of Prince George, BC) Unfortunately your circumstances don't lend themselves to a quick and easy answer. On top of that, you've got a whole pile of issues to deal with. Spousal Support: Spousal support usually depends on whether you have the "need" for support and whether he has the "means" to pay it. If you're working, wonderful... you're self-sufficient. This will, however, undermine your entitlement for support. On the other hand, your long-term self-sacrifice for your husband's career can be compensated by... Asset Division: While the Family Relations Act presumes that family assets should be divided equally, it seems to me that the way to compensate you for the side-lining of your career for the sake of your husband's could be by the reapportionment of the family assets in your favour. In other words, you should ask for more than merely 50% of the assets. That being said, you have another problem in that he's disposed of a fair amount of valuable items! The equipment he sold is a family asset, and, at a minimum you should be entitled to half of the money he sold these things for. Family Home: No, he won't be able to simple take your home from you. On the other hand, he has an obvious interest in the home, and you will either have to buy out his interest or compensate him for his interest in some other way if you'd like to keep it. Most often a couple will sell the family home and split the sale proceeds in some manner. However, you seem to me to have a reapportionment claim, and you deserve to be compensated for his sale of his work equipment. Perhaps this is sufficient to relieve him of his interest. Your case is fairly complex. I strongly encourage you to find a lawyer in your neighbourhood for a proper answer to your question. Click here to go to the top of the page. My father has been married for six months. He is living in Vancouver and she is living here in Kamloops. They have only been together for approximately a month. My father made a promise to her that he would move to Kamloops after they were married. After they married he found they were not compatible. So he continues to live in Vancouver, and feels strongly that they should seperate. They have no financial obligations together. The house has been fully paid for. There are no financial debts or anything between them. They have only been together for a few months. Does she have any legal right to any of his money or property? What rights does she have? What is my dad obligated to? (by C of Kamloops, BC) The general rule in very short marriages is that each spouse will keep the bulk of the property they each brought into the relationship. There is a presumption that family property should be divided equally, however this presumption can be rebutted where a marriage was brief; if your dad is on the hook at all, he'll be entitled to perhaps 5 to 10% of her assets and she'll be entitled to 5 to 10% of his assets. Any property that was jointly purchased following marriage will likely be divided proportionate to each spouse's income. Click here to go to the top of the page. Three years ago, I made alot of money and loaned a fair sum to my husband's business, of which I am neither a shareholder nor a director. Three weeks after we separated, he sold the homes, spent the money and never paid me a dime back. I was destitute. Can I include this information in my claim and ask the judge to order a lump sum or periodic payment to me? (by D of Kelowna, BC) First off, you're confusing two different issues. There's a difference between the payment of spousal support, which can be paid as a "lump sum" or periodically, and the division of family assets and the allocation of responsibility for family debts. Essentially, what you're saying is that you loaned your husband's company some money and that he owes a debt to you. This is not something that spousal support is designed to compensate you for. The company, regardless of whether you were an officer, a director, or a shareholder or not, is a family asset. If your husband operated the company with someone else who also had share of the company, your interest in the company is in your husband's share of the company. What you can do, to realize the loan, is ask the court to order that you have a larger share of the company than your husband, that it be reapportioned in your favour to compensate you for the loan. This will likely result in you receiving a larger share of the family assets to make up for your interest in the company, as the courts generally don't order that a spouse's share in a private company actually be transferred to the other spouse — the court accounts for this interest by transferring other property to the non-owning spouse. You can certainly ask that, in addition to the other orders the court will make about the property, that your husband pay a fixed sum to you right off the bat to compensate you for the loan, but this isn't spousal support, it's an aspect of the division of the family assets. Be warned, however, that the court may consider your loan to be the family's loan of family assets to another family asset, the company. You may have to jump through some hoops to show that the loan was a loan of your personal property. This issue is a bit more complex than I can readily get into via email, especially with the limited information you've given me. I strongly urge you to consult with a lawyer in your neighbourhood to get some proper legal advice about your situation. Click here to go to the top of the page. My wife and I separated at the end of 2003 after 10 years of marriage. We have 3 children that we plan to have joint custody over. The two of us want to keep the children's best interest in mind and don't want to have any legal battles or ill feelings. We are currently working on a separation agreement. I entered the marriage with $60 000 or equity in a condominium which we used to purchase our house. She entered the marriage with a $10 000 student loan which I paid off with savings I had. We bought a 5th wheel travel trailer 5 years ago with money my brother paid back to me (a loan prior to my marriage). I understand that the presumption is 50/50 for family assets. Do I have a case for a larger share of the family home equity and the trailer? I want to have dialogue with my wife about this issue before completing the agreement. (by K of Enderby, BC) My first-impression answer to your question is that while you might have a claim to a greater share, it is likely to be negligible. Unless you can negotiate a greater share with your wife, it's not likely to be worth the cost of battling it out in court. The problem you've got is that things that might be considered "personal assets" exempt from division can lose that personal flavour over time and become "family assets" that are subject to division. The more time that passes, the more likely a personal asset is to have become a divisible family asset. The equity in your condominium would likely have remained mostly yours had you and your ex separated shortly after you sunk the money into the family home. However, what might have been your personal property has been used for a family purpose for a significant period of time, and, unless there's some fact I'm unaware of, is definitively a family asset. The other issue you were concerned about related to the loan. Money due on a loan is an asset, in the sense of an account receivable. It was an asset that was returned to you and was subsequently used for a family purpose, the purchase of the fifth wheel. It's the same as if you bought the fifth wheel with an unusually large bonus from your job. Both the equity from your condo and the loan used to buy the fifth wheel have become family assets. You're right, there is the presumption that family assets ought to be split equally between spouses. At law, the only way you would be able to receive any compensation for the loan and the condominium's equity would be to seek a reapportionment of the family assets in your favour in compensation for your disproportionate contribution to those assets under s. 65 of the Family Relations Act. Bearing in mind the significant amount of time that's passed, I can't see how, if the matter went to court, that the court would give you anything significantly more than an equal interest. Nevertheless, despite whatever the law might have to say about it, you are engage in a process of negotation, and you are free to come to your own deal with your wife; the courts and the Family Relations Act have nothing to do with you until and unless someone sues someone else. I'm not persuaded that you ought to have anything more than 50/50, but I'm not your ex. She might well agree that you deserve a larger interest in the home and the trailer. Click here to go to the top of the page. If a house is jointly owned and one spouse wishes to remain there should the other spouse be responsible for 50% of the real estate fees that would have been incurred had the property been sold? (by D of Abbotsford, BC) Real estate fees and whatnot are only considered where there is a likelihood that the home is going to be sold in the near future. Absent proof that the house is going to be sold in the foreseeable future, the court generally won't order that commission and taxes and so forth be taken into account where a spouse is staying in the home and buying out the other spouse's interest. Click here to go to the top of the page. My husband (we are separated) is now living with another woman. I understand after a certain period of time she will have certain rights & claims to his assets. Am I entitled to part of his pension? I gave up mine when we decided I should stay home & care for the children. Can I protect my name as beneficiary on his pension & life insurance? I worry that if he dies & his assets go to her, my children will not receive anything, because she can then dictate where her estate will be dispersed. What about future inheritances? What claims (if any) can be made against that? (by C of Port Coquitlam, BC) Things actually aren't so bad for you. Until you divorce and she and he become legally married, she has no presumptive claim to an interest in his pension. You, on the other hand, have an interest in his pension which will continue to grow until: you get divorced, there is a declaration that the two of you are unable to reconcile, or you sign a separation agreement. Once any of those things happen, your interest stops growing. Your interest is a presumptive one-half of the part of his pension which accumulated between the date of your marriage and one of the three events I've just described. As a common-law spouse, assuming that your ex and this woman live together long enough to qualify as common-law, she has no presumptive interest in either his pension or the assets he holds in his name alone. If she and he marry, well that's another story. If she marries, her interest in his pension will beging from the date of their marriage. As far as inheritances go, that isn't an area of competence of mine, but I'll tell you what I suspect is the case. When you divorce, his will will be considered revoked. Which is fair, since why should you have a benefit in his estate? Until that happens, you should still have an interest which trumps that of his common-law spouse, though I seem to recall reading that separation for one year may have an impact on your rights under certain legislation. What you want to read are: the Wills Act; the Wills Variation Act and the Estate Administration Act. That'll tell you what the rules are. Click here to go to the top of the page. My separated spouse and I have several debts, a line of credit and a consolidation loan in both our names which make up the bulk of the debt, and several credit cards in his name alone with minor debts, nothing else joint. How do we divide them? (by D of Vancouver, BC) First of all, you must understand that debts are NOT dealt with in the Family Relations Act. All the act talks about is the division of assets, not the division of debts. Generally, what the courts have had to say on this subject is that spouses should each be responsible for debts that were incurred for a family purpose. A spouse who incurred a debt for personal purposes will remain personally responsible for that debt. From an out-of-court perspective, you and your husband have a fairly broad selection of choices in how you deal with the division of your debts. The very first step is to separate the debts that were incurred for mostly personal reasons from the debts that were incurred for family purposes. In general, it's only debts incurred for the benefit of the family that both spouses will share responsibility for, however nothing's stopping you from lumping all the debts together. Once you've decided what debts you'll both be responsible for, then you have some choices. If a client of mine has an interest in the family home, I usually suggest that the house be sold and the proceeds applied to clear off the debt. That's an objectively fair way to handle the debts, and there's usually enough equity in the family home to give each spouse some seed money to move on with their lives. If one of the spouses wants to keep the house, it's always possible to remortgage the house or take out a second mortgage to pay for the outstanding debts. If there is no other source of equity to pay out the family debts, the easiest thing to do is for each of the spouses to take out separate consolidation loans for one-half of the debts they've agreed to share. The consolidation loan is used to pay out the joint debts, to leave each spouse with their own personal debt. The point of this whole exercise is to pay out all the joint debts to end all on-going legal ties between the spouses. If it all possible, all debts for which both spouses are on the hook should be paid out. You do not want to have a situation where a spouse remains liable for a credit card debt (or some other debt) that the other spouse may or may not pay out. Click here to go to the top of the page. My husband and I are starting to negotiate a separation agreement, and we don't know how to handle the share options we are entitled to exercise with his employer. We have not purchased them yet. Do we get a loan to purchase them all now or do we use the proceeds from the matrimonial home to purchase the shares? It is approximately [number] shares, and could cost about $[cost] to purchase them all. (by A of Port Coquitlam, BC) That's a very complex problem you've got, and, as a result, I'm going to give you a bit of information and suggest that you speak to a good family law lawyer for some proper legal advice to answer your question. First, options are funny things. They can be absolutely worthless (Nortel, junior mining stocks, etc) or they can be diamonds (Microsoft, start-up tech companies, etc). Most often, you never know how the options are going to turn out. Because of that, I'd be very cautious in chosing to get a loan to exercise them. You wouldn't want to go into debt only to find out you've bought a pig in a poke. Where an option has been cruising well below the exercise price for a long while and there's no immediate prospect for improvement, I generally consider them to be worthless, and don't look at them too closely in dividing assets. If it's the case that the stock is performing well above the option price, then obviously the options have value and must be considered in the division of family assets. But if you have to incur debt to excerise the options, I'd look very closely at the company first. You're making a huge gamble: will the stock continue to perform well? If you smell trouble and think you might want to dump the stock, will the capital gains tax worsen your debt load? Finally, how will you consider the debt in the division of assets? Do you each take out a loan for $[half of cost]? Can you sell a family asset, like the family home, to exercise the options in a debt-neutral manner? At the end of the day you need some good legal advice. Too much depends on how the options are held, whether options are transferrable, what the company's prospects are, capital gains issues, and so forth. You need very specialized legal advice; make sure you get a family law lawyer who has a track record of dealing with complex asset cases. Click here to go to the top of the page. My wife has left me after 20 yrs. for another man. She was the main bread winner by choice, I worked part-time and was a "mr. mom". We have a 16 yr old son and 21 yr old daughter. My son is a drug addict and is in rehab now; my wife couldn't deal with it and left for the man she apparently had been seeing for the past 4 yrs. I want a legal serperation but she refuses to talk about it. I will give her anything if she will let me and the kids have the house. There is a small debt attached to it. She now is indicating that she wants a big chunk of what the house is worth, and I since found out that while me and kids are living on next to nothing she won [amount] in a bingo lottery. She throws a hundred or two hundred our way when she feels like it. I am trying to find full time employment but am currently undergoing tests to find out if I have cancer. I want to know if what she has done will effect the division of our assets. (by G of Richmond, BC) As a general rule, someone's conduct during the marriage does not play a role in how assets are divided or whether spousal support is payable. Her conduct will be relevant to the arrangements for the care and control of your son, however, since she shows a pretty surprising disinterest in his welfare. Now, you should know that you are probably entitled to receive child support from her as well as spousal support. Spousal support isn't just for wives. As well, if you have a greater need to become financially independent because of, for example, your time out of the work force during your marriage and your possible illness, a greater share of the family assets could go to you. Finally, you can lead a horse to water but you can't make it drink. You cannot force her to execute a separation agreement with you. If she refuses to bargain with you in good faith, you may have no choice but to start an action in the Supreme Court. Sometimes that is enough to lead someone back to the bargaining table. Click here to go to the top of the page. I have a full-time career and my husband is on EI. We will split any remaining debt after selling our house and will have those terms in a separation agreement. However, I've heard that the banks/creditors go after the person who can actually pay (in this case me) no matter what the legal agreement says. Is this true? If so, how do I avoid this? (by A of Victoria, BC) What you heard is true... as far as debts that you are jointly responsible for are concerned. If it's a debt in his name alone, the banks can only chase him. If it's a debt that you co-signed or guaranteed, the banks can go after either or both of you to pay the debt. Unfortunately there's really not much that can be done about joint debts. If you can't pay out the debt with the proceeds of sale from family assets, you're kind of stuck with trusting his good faith to pay out the debt or paying it out yourself. If there aren't enough family assets to pay out the debts, there are still some ways to convert a joint debt to a debt only one of you is responsible for. One of you could apply for a line of credit to pay out a joint debt, or a new credit card and transfer the joint balance onto the new one. What you're doing is shuffling the debt around, but the point is to get it from a joint form of debt into one that's only in one person's name. I strongly encourage you to do whatever you can to ensure that no joint debts remain. If any do, you're leaving yourself exposed to a long term liability and all you have is your trust in your ex that he'll do the right thing. Click here to go to the top of the page. About my Employee pension plan, I had 10 years service when we married and 20 years of marriage. I plan to retire in 5 years. It is my understanding that my ex will be entitled to an apportionment i.e 20/35 of 50% of my pension when I retire. Is this negotiable since I was the prime care-giver for the boys for most of the time and the marriage did not compromise her career in any way? (by L of Coquitlam, BC) The share of your pension that your ex is presumed to be entitled to is from the date of your marriage until the date you sign a separation agreement, get divorced or a court says that the two of you are unable to reconcile, whichever comes first. (She won't be entitled to share in the whole pension since you were contributing to it for twn years before you married.) Your wife will be presumed to be entitled to one-half the pension that accrued in that period but, as with all, things this too is negotiable. She can ask for reapportionment of your pension in her favour and you can ask for reapportionment in your favour. You won't necessarily get a credit for your care for the boys, however. Your pension is an asset and whether your get half or more of it depends on the rules about dividing assets. Click here to go to the top of the page. My wife left me 2 years ago. Now she would like her half of the equity of our house. Is she entitled to half the equity as of when she left, or is she entitled to half of today's value even though she has not paid anything towards the mortgage, taxes or repairs? (by D of Delta, BC) Unfortunately, the answer to your question is one that you're going to have to argue about. There are some cases that put the valuation date for a home at the date of separation, but more cases use the present value of the house to figure out its worth. Your ex will, of course, want to value the property at the present since that'll give her the most out of the house. You, on the other hand, will be able to argue that the house should be reapportioned in your favour, in other words, that you should have more than half the house's equity. Certainly your sole contribution to the house will be a significant factor that should give you credit for all the payments and work you've put into the home since separation. I'm afraid I can't be much clearer than this. This is something you and your ex will have to argue about in court or settle between you, but either way you have a very good reason to seek compensation for the money you put into the house. Click here to go to the top of the page. Site Navigation Go back to the Q&A Index. Section Menu
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