The best Edmonton family property division lawyers help Edmonton family law clients deal with family property and debt division issues. Edmonton high net worth separations and Edmonton grey divorce issues add an extra level of complexity when dealing with different rules for different types of matrimonial property. Peter Graburn of our Edmonton and Calgary office explains the rules.
Best Edmonton Family Property Division Lawyers 403 444 5503
While the term has been used a lot lately, Alberta is clearly going through “unprecedented times”. The social and physical restrictions imposed due to the COVID-19 pandemic in 2020 have compounded the already severe economic consequences of the downturn in the oil and gas industry experienced since 2014. Consequently, separating spouses in Alberta are increasingly having to ask themselves: “how are we going to divide our joint family property?” The best Edmonton family property division lawyers know that while the division of family property in Alberta is regulated by provincial legislation, there are still a lot of questions asked about this issue, particularly in regard to “High Net Worth” and “Grey Divorce” separation and divorce.
The division of family property upon separation (of so-called “common-law” couples) or divorce (of married spouses) in Alberta is governed by the Family Property Act (FPA). The FPA (which extended property rights to Adult Interdependent Partners – so-called “common-law” spouses – in January 2020) divides family property in a “just and equitable” manner, which usually means equally (or 50/50). But what is included in this ‘equal’ division of family property, and how does this impact particular ex-spouses?
Generally, there are three (3) groups of property that must be dealt with upon Edmonton Division of Family Property, being:
● Assets – these are what most separating spouses focus on during relationship breakdown, including: the matrimonial home, automobiles, household furnishings, etc.;
● Debts – with the downturn in the Alberta economy, these are becoming increasingly more important to deal with, including: mortgages, lines of credit, vehicle loans, credit card debt, etc.;
● Exemptions – while the general rule of Alberta family property division is 50/50, certain groups of property are taken out of (ie. exempt from) the calculation of family property, including: inheritances; gifts from other people; damages and insurance proceeds paid to one spouse only, and; value of property brought in to the relationship [Section 7(2), FPA].
Edmonton high net worth separations “High Net Worth” and “Grey Divorce” 403 444 5503
But how does this statutory division of family property affect specific groups of separating spouses, such as “High Net Worth” spouses or “Grey Divorces”? “High Net Worth” spouses are those that have accumulated significant family property (ie. $2-5M) and often have corresponding high annual incomes (ie. $1M). “Grey Divorces” involve separating spouses approaching or past middle age, and may often include “High Net Worth” spouses. These types of separation and divorce in Alberta may often involve other types of assets, including: farms, acreages, cabins and cottages; family businesses and professional practices, and; investments (ie. RRSPs, TFSAs, RRIFs, etc.).
So how should “High Net Worth” spouses and those involved in “Grey Divorces” deal with the division of their family property (both assets and debts) in these current (and post) COVID-19 times? Some important things to consider include:
● Appraisals and Valuations – obtaining current valuations of homes and businesses during COVID-19 restrictions may seem difficult, but real estate appraisers and business valuators maintain they can still give accurate opinions of value on these properties (subject to certain conditions);
● Tracking and Tracing – sometimes an ex-spouse does not fully disclose property or income, and exempt property must be traced if converted from one form of property to another. In these cases, a forensic accountant may be helpful to track or find complex or hidden property and income;
● Hold and Wait – selling property is the ultimate way of determining its fair market value. But during this time of “economic uncertainty” and depressed values in Alberta, separating spouses may want to consider dividing their property “in kind” or even postponing the division of their common property (even if this delays the final resolution of the separation and divorce) until economic conditions in Alberta settle out.
So, the provincial Family Property Act has made division of family property for both married and “common-law” couples in Alberta easy, right? Not really. COVID-19 social and physical restrictions are likely to continue in Alberta (and world-wide) until at least the Fall of 2021, after which time real estate and business values should start to normalize. It is more uncertain as to when the oil and gas industry in Alberta will recover. Until both those factors have stabilized, division of family property in Alberta upon separation and divorce (particularly for “High Net Worth” and “Grey Divorce” couples) will remain a challenging situation.
Best Edmonton Family Property Division Lawyers 403 444 5503
MacLean Family Law has Offices across Canada including downtown Vancouver, Calgary, Toronto, West Kelowna, Surrey, Richmond, Victoria, and Fort St. John. For Family Court locations, forms and links click here.
The best Edmonton family property division lawyers help their clients understand the provincial statutory framework for division of joint family property upon relationship breakdown, as well as the practical and current considerations that should be taken for dealing with the division of family property during these most “unprecedented times”. If you have questions concerning Edmonton high net worth separations and Edmonton grey divorce issues call us early on to get a successful strategy.