Once you and your spouse have decided to separate, it’s crucial that you also decide what will happen with your assets? Alongside the many questions you’re dealing with at the start of separation, figuring this out can be both emotional and stressful. It’s one of the most frequently asked divorce questions and often carries a lot of financial worry. You might have heard about Ontario requiring equal sharing of property within the Family Law Act. This can often be difficult to understand and raises questions about how assets will be divided fairly. In this article we explain how family property is divided after divorce, so you can get a better understanding of where your marital assets will go.
What Is Family Property?
In Ontario, any asset or property acquired during a marriage (meaning after the marriage date and before the date of separation) is considered family property. This includes all assets, joint bank accounts, debts, pensions, business property and real estate. To the court, marriage is an economic partnership and confirming your separation date is very important.
What Does Ontario Law Require?
The Family Law Act states that the division of family assets should be done equally. This does not mean that the property will be equally split, but rather that spouses will determine what they owe, based on equalization of net family property or NFP. This means that spouses will equally share what was earned during their marriage based on the NFP calculation. During the process each spouse is required to complete Form 13.1 in order to determine their NFP.
The calculation process goes as follows:
- Value of assets and liabilities at the marriage date is calculated
- Value of assets and liabilities at the separation date is calculated
- Marriage date total is then subtracted from the separation date total to equal the NFP
- Lower NFP is subtracted from the higher
- The equalization payment is then determined by dividing the NFP difference by 2
The Matrimonial Home
The Family Law Act considers the matrimonial home differently and states that both spouses have equal access to it. This is because the home is usually considered the most valuable asset to the family and often holds a lot of emotional importance. The right of possession of the matrimonial home prevents one party from forcing the other out without a court order. If you and your spouse are disagreeing over who will continue to live in the home and cannot come to a decision, the court can make an “exclusive possession” order. Some of the factors considered when making the order include: the best interests of the child who will reside in the home, the financial situation of the spouse seeking possession, concern for family violence, and any existing property orders.
Dealing with family property division can be difficult, especially while the reality of the divorce may be causing grief, confusion and stress. When the process is complicated based on the specifics of one’s situation, an experienced family lawyer can help you through each step while also providing the understanding and support you need at this time. At the end of the day, make sure you are aware of your rights and what you should be enforcing so that you can positively move forward after divorce.
At Hussain Law we focus on helping our clients navigate the emotional and financial challenges of separation and divorce. Our office remains fully operational, and we have implemented various new procedures that allow us to continue to advise clients seamlessly during this time. If you have a family law issue that you need assistance with, please contact Ayesha Hussain at 647-428-3919.