Toronto Common Law Property Rights Alert. Did you know many jurisdictions across Canada now treat common-law couples the same as married couples as far as dividing family property on relationship breakdown? Unfortunately, Toronto Common Law Property Rights are not equal to married couples’ property rights in Ontario. Peter Graburn senior Calgary and Toronto family lawyer explains the differences in today’s blog.
Toronto Common Law Property Rights 416 900 3428
‘Common-law’ relationships are becoming, well, more common – in 2016, some 20% of Canadian couples lived in a relationship of long-term family and economic interdependence without getting married. This is their choice. But it also has an effect on their legal rights and responsibilities regarding each other upon the breakdown of that relationship. Toronto Common Law Property Rights are more important as more people choose to commit to each other without marrying.
In a previous article (see: Best Toronto Family Separation Lawyers – ), we indicated how common-law spouses in Ontario have many similar rights and responsibilities upon relationship breakdown to married spouses (ie. regarding parenting of children, child support, and spousal support, etc.). But we also noted that they do not have the same rights and responsibilities in regard to the division of their family property. So how do division of family property rights and responsibilities in Ontario differ for married and non-married (ie. common-law) spouses, and how are they determined? It’s a little complicated.
Toronto Division of Property upon Divorce
In Ontario, division of family property for married spouses is codified under Part 1 of the Family Law Act (FLA). Generally, upon separation or divorce, married spouses are entitled to an equalization (ie. equal sharing) of their net family property [s. 5(1) FLA]. Certain property (ie. inheritances, damages from personal injuries, life insurance proceeds, etc.) are excluded from this equalization of property [s. 4(2) FLA]. Furthermore, the division of the matrimonial home is given special and specific treatment under the FLA [Part 2].
Division of Common-Law Property 416 900 3428
Section 29 of the Ontario FLA defines common-law spouses as unmarried partners who have lived together for at least 3 years (or less if they have lived in a relationship of some permanence and have a child together). But there is (currently) no legislation in Ontario that gives those common-law spouses rights and responsibilities to the division of the family property upon separation as is given to married couples under the FLA. How then do common-law spouses divide their property upon separation in Ontario?
Surprisingly, Ontario common-law spouses must still need to look to the equitable and common law remedies of constructive/resulting trust, unjust enrichment, and quantum meruit to establish their entitlement to a share of their ex-common-law spouse’s property. Common-law spouses have to bring a Court action and prove: enrichment of the other spouse; corresponding deprivation (monetary or otherwise) by the applying spouse, and; no juristic (ie. legal) reason for the enrichment. Even then, the Court does not need to divide property equally. Complicated? You bet.
Joint Family Venture
In 2011, the Supreme Court of Canada (see: Kerr v. Baranow,  1 SCR 269) clarified the common law on unjust enrichment and resulting trusts in regard to the division of family property by introducing the principle of Joint Family Venture (JFV) (where unmarried couples who have accumulated property in which both parties have contributed can share an interest in such property), characterized by (but not limited to) the following factors:
● Mutual effort by the parties;
● Economic integration of the parties;
● Actual intent of the parties to share property, and;
● Priority of the family by the parties.
The Supreme Court of Canada held that, where such a JFV is established, the spouses may be entitled to a share of the accumulated property (but not necessarily an equal, ie. 50% interest).
So, is it surprising that there is currently no provincial legislation giving Ontario common-law couples substantially the same rights and responsibilities to the division of their family property as Ontario married couples on the breakdown of their relationship? Absolutely. Ontario is certainly lagging in granting Toronto Common Law Property Rights similar to those of married persons in other jurisdictions.
In Alberta, these rights and responsibilities were statutorily extended to common-law couples (called “Adult Interdependent Partners”, or AIPs in Alberta) starting on January 1, 2020 under the Alberta Family Property Act, part of a number of statutory changes designed to modernize Alberta family law legislation in the areas of property division and child support to make it more fair and inclusive.
This difference underscores the importance and benefits of considering entering an agreement (whether a Cohabitation, Prenuptial or Separation Agreement) with your current or future partner as to how your family property will be divided upon the possible breakdown of that relationship (as well as other considerations including children and financial support). These Agreements allow the partners to draft their own agreement to structure the division of their family property they way they want, rather than follow government created rules (or lack thereof) for such division of their property.
For more general information take a look at this.
Call Our Toronto Common Law Property Rights Lawyers Today
Toronto Common Law Property Rights Lawyers can assist their clients to understand the different ways Ontario common-law couples and married couples are treated under the law in Ontario and assist them to make sure their wishes and preference are respected when they differ from the current family law framework in effect in the province.
MacLean Law family lawyers act across Canada and our firm has won a number of awards for their family law work. Lorne MacLean, QC was just named one of Canada’s top 25 most influential family lawyers.