How does Matrimonial Home Occupation Rent work in BC and Alberta? Lorne MacLean, QC founder of MacLean Law’s, Matrimonial Home Occupation Rent Lawyers, writes today’s blog on a common source of disagreement involving the separated spouses and their matrimonial home. Our BC and Calgary Matrimonial Home Occupation Rent lawyers can be reached toll free at 1-877-602-9900. Fill out our consultation form.
Vancouver Matrimonial Home Occupation Rent Lawyers 1-877-602-9900
In the September 2017 BC Supreme Court case of McFarlen v McFarlen a complete summary of the law on the issue was undertaken and it shows how rent paid by the departing spouse is offset against expenses paid by the occupying spouse and the presence of children in the home is also a significant factor. Matrimonial Home Occupation Rent cases often involve an assessment of the costs and benefits each spouse has for vacating and renting and remaining in and paying the expenses for the matrimonial home.
So How Does Matrimonial Home Occupation Rent Work?
[12] I turn firstly to the issue of occupational rent which the claimant seeks since the respondent lived in the former matrimonial residence from separation until it was sold. Before reviewing the facts relating to this claim, I summarize the current law in British Columbia relating to claims for occupational rent, which fall under Division 4 of Part 5 of the Family Law Act, S.B.C. 2011, c. 25 [FLA].
[13] In Ross v. Ross, 2013 BCSC 1716 [Ross], Verhoeven J. discussed the principles applicable in a claim for occupational rent. He stated, starting at para. 47:
[47] I observe that in other Canadian jurisdictions, the law does not focus upon the question of ouster, or of claims for expenses by the spouse remaining in possession. The principles applicable in Saskatchewan were recently summarized in Casey v. Casey, 2013 SKCA 58 at para. 48:
From the jurisprudence the following principles may be drawn regarding the awarding of occupational rent on a matrimonial home:
1. Occupational rent is a remedy which may be utilized to obtain justice and equity in appropriate circumstances.
2. The remedy is exceptional and should be used cautiously.
3. The following factors, where relevant, are appropriately considered:
· The conduct of both spouses, including failure to pay support, the circumstances under which the non-occupying spouse left the home, and if and when the non-occupying spouse moved for a sale of the home (Peltier at paras. 16-17; Wilgosh at paras. 99 and 109; Good, at para.90)
· Where the children are residing and who is supporting them (Good at para. 90; Peltier at paras. 16–17; Wilgosh at para.108).
· If and when a demand for occupational rent was made (Wilgosh at paras. 100 and 106; Good at para.90, and Peltier at para.16)
· Financial difficulty experienced by the non-occupying spouse caused by being deprived of the equity in the home (Peltier, at paras. 16-17; Wilgosh at para. 106)
· Who is paying for the expenses associated with the home. This includes who is paying the mortgage and other upkeep expenses (maintenance, insurance, taxes, etc.). ….
· Whether the occupying spouse has increased or decreased the selling value of the property (Peltier at paras. 16-17)
· Any other competing claims in the litigation that may offset an award of occupational rent (Wilgosh at para. 108; Good at para. 92).
4. The remedy is a discretionary one requiring the balancing of the relevant factors to determine whether occupational rent is reasonable in the totality of the circumstances of the case.
Ouster Is Not Required In Matrimonial Home Occupation Rent
This recent BC Matrimonial Home Occupation Rent case explores the concept of fault and conduct which was a focus in older cases and says given the new no fault approach to family law means this approach is outdated and irrelevant.
…To focus on a consideration of “ouster” is to set the development of family law back to the “bad old days” when issues of conduct may have been relevant considerations to our courts. How a person came to be in possession of a jointly owned asset should be a lesser concern to the court. The effect of the period of occupancy should be the focus of the court’s consideration in exercising its discretion in attempting to value a fair result.
[50] On the approach used by the other jurisdictions, as I interpret it, the overriding question is whether occupational rent, as a discretionary remedy to be used cautiously, should be utilized in order to achieve justice and equity in all of the circumstances of the case. This approach appropriately places little if any emphasis on the question of fault or blame for the decision of one spouse or the other to leave the matrimonial residence.
[16] The approach summarized by Verhoeven J. was accepted by McEwan J. in Piderman v. Piderman, 2015 BCSC 475 [Piderman] where he stated at para. 53:
I think this is the proper way to approach occupation rent, that is, as a tool to achieve fairness. Were I to take a stricter approach, treating occupation rent as something akin to an entitlement, the outcome would, I think trigger other issues about fairness. I would think that, in general, claims for occupation rent ought not to be hoarded and advanced for the first time at trial. Failure to give notice of such a claim is apt to be interpreted, in the complex emotional aftermath of a marriage, as acquiescence, or a form of spousal or child support. I find that to be the case here. I dismiss the claim for occupation rent.
[17] Subsequent to the reasons in Piderman being issued, Butler J. discussed occupational rent in Hodel v. Adams, 2016 BCSC 910 [Hodel], at paras. 18-20 he stated:
[18] Ms. Adams advances a claim for occupation rent as Mr. Hodel has continued to live in the Family Home since September 2014. Mr. Hodel opposes the claim on the basis that Ms. Adams was not ousted from the Family Home; she left voluntarily. Further, he says it would be inequitable to grant her a claim for occupation rent because she has not come to the court with clean hands.
Surrey Matrimonial Home Occupation Rent In Family Cases
[19] Claims for occupation rent are frequently advanced in family law cases. The leading cases in British Columbia on occupation rent are Stasiewski v. Stasiewski, 2007 BCCA 205; and Oyama v. Oyama, 2009 BCCA 114. In L.M.R. v. J.F.R., 2010 BCSC 363 at paras. 27 to 36, Willcock J. (as he then was) reviewed the authorities and thoroughly summarized the law. I adopt his analysis of the principles which apply to claims for occupation rent. As he noted, the decision in Oyama does not alter the approach to occupation rent in family cases as set out in Stasiewski.
[20] At common law, a co-tenant is entitled to claim occupation rent when he or she has been ousted from property. Absent an ouster from the property, there is no claim. However, if the tenant in possession seeks to recover property expenses from the departed tenant, the court retains a discretion to set off occupation rent against the expense claim. However, as noted in L.M.R. at para. 32, there is no absolute right to such a claim or setoff;
[32] An allowance for occupation rent is not mandatory, even where there is a claim for expenses associated with occupation. It is an equitable remedy. In Dacyshyn v. Semeniuk, 2007 BCSC 71, the court recognized the general rule described in Bernard, [1987] B.C.J. No. 262, but refused to allow a claim for occupation rent, despite a claim for expenses, on the ground that the remedy is an equitable one and is not available to a party who comes to court with unclean hands or where it is not necessary to address inequity.
Fort St John Matrimonial Home Occupation Rent
The court focused on achieving a fair result when deciding what amount if any to award for Matrimonial Home Occupation Rent and ouster seems to be a waning if not extinct concept in family law Matrimonial Home Occupation Rent cases:
[18] In an even more recent decision issued July 13, 2016, C.M.L.S. v, F.C.M.S., 2016 BCSC 1298 [C.M.L.S.], Verhoeven J. referred to his previous decision in Ross and the decision of McEwan J. in Piderman and concluded at paras. 133 and 134:
[133] The proper way to approach occupational rent is as a discretionary tool to achieve fairness: Piderman v. Piderman, 2015 BCSC 475 at para. 53 (McEwan J. citing Ross at para. 51).
[134] If required, the mother has not established “ouster” on the evidence. She departed voluntarily and by agreement. There is no evidence of any complaint by her about that, or the consequences of that. …
[19] However, there is some competing authority in BC that says that ouster is required before a party can claim the cost of reasonable alternative accommodation. As recently as December 2016, Fleming J. in J.D.G. v. J.J.V., 2016 BCSC 2389 summarized this contrary line of law on entitlement to claim occupation rent as follows:
[226] At common law, a co-tenant is entitled to claim occupation rent when he or she has been ousted from property. Absent an ouster from the property, there is no claim. However, if the tenant in possession seeks to recover property expenses from the departed tenant, the court retains a discretion to set off occupation rent against the expense claim. There is no absolute right to such a claim or set off. Occupation rent is an equitable remedy (L.M.R. at paras. 27–29, 31, 32).
[20] So, is “ouster” a condition precedent to a claim for occupational rent? The authorities suggest that this remains an open question. Based on my interpretation of the law in this province, I accept that “ouster” is no longer a pre-condition to a claim for occupational rent measured by the cost of alternative accommodation. The statements by Verhoeven J. which have been adopted by McEwan J. in Piderman as well as the statement by Willcock J. in L.M.R v. J.F.R., 187 A.C.W.S. (3d) 775, support this interpretation. My reasoning is reflective of the opinions expressed by Verhoeven J. and McEwan J. in Ross, Piderman and C.M.L.S.– that the proper way to approach a claim for occupational rent is as a discretionary tool to achieve fairness. Such a conclusion is consistent with family law legislation including the Divorce Act, (R.S.C., 1985, c. 3 (2nd Supp.)) and the FLA which are not premised upon “fault based” principles. If I have correctly interpreted the law in British Columbia, then a review of the claim can proceed on the basis of equity. If “ouster” is required, this issue would have to proceed to trial to determine whether or not there has been an ouster.
[21] With respect to the respondent’s claim for occupational rent for the cost of maintaining the property, a claim can be submitted regardless of whether “ouster” has occurred: Donovan v. Donovan (1986), 7 B.C.L.R. (2d) 221, 5 R.F.L. (3d) 1 (S.C.) at para 12; B.G.P. v. L.M.P., 2012 BCSC 1240 at paras. 41-47.
[22] However, I note that an award of occupation rent cannot be justified by a claim for capital and non-capital expenses of maintaining the property; see Oyama at para. 6. The only expenditures an occupying tenant can put forward is a claim for expenditures made to the benefit of the property: see Stasiewski v. Stasiewski, 2007 BCCA 205, 67 B.C.L.R. (4th) 81 at para. 28 citing Donovan v. Donovan (1986), 7 B.C.L.R. (2d) 221, 5 R.F.L. (3d) 1.
So What Happened In This New Matrimonial Home Occupation Rent Case?
The Court then went on to use the rental cost of alternate accommodation to set the occupation rent owed for use of half the home of the absent owner set off against expenses paid by the occupying owner for property taxes and insurance premiums. Although not claimed in this case mortgage payments or lines of credit used to buy or renovate a home in a case where occupation rent is claimed could be a significant offsetting factors. Phone bills, and electrical and hydro costs that were not directly related to the home were not offset in this case.
