In Ontario, spouses must share the equity collected during the marriage upon separation, along with debts accumulated. This is known as the equalization of net family property. Section 4 of the Family Law Act defines net family property as the value of all property that a spouse owns on the date of separation, after deducting the spouse’s debt and liabilities, and date of marriage assets or debts.
In order for a spouse to satisfy the court with a date of marriage deduction claim, they must prove the property existed on the date of marriage and its appropriate value. Having the deponent testify their estimate value of the property will not be sufficient. Instead, records of a Sales and Purchase Agreement (SPA), receipt, bank statement or appraisal would be appropriate. Property that can be included as a date of marriage deductible can range from real estate, cash, cars, jewelry, household contents, timeshares, and even pets. Also, any pension value accumulated before the date of marriage will be allowed as a deduction. This type of deduction is notoriously hard to prove for long marriages. Banks may only keep records for 7 years. It is always recommended to keep a printout copy of all major transactions.
It is important to note that the law does not concern itself with what happened before the marriage. Rather, the date of marriage becomes a starting point to determine the net family property calculation and a spouse’s entitlement following the breakdown of the marriage. Even if there is a material change that is attributable to your shared circumstance, the law cannot take this into account. In short, only the financial circumstances after the date of marriage will influence one’s entitlement in the separation and divorce process.
Here is a very simple example of how date of marriage deductions would apply:
You received a painting as a graduation gift prior to your marriage. After you were married, the painting was displayed in the dining room of your matrimonial home. On the date of marriage, the painting was worth $10.00. Upon separating from your spouse years later, the painting had increased in value to $19.00. Based on this example, the net effect of $9.00 will be shared among the spouses. The value an individual incurred prior to the date of marriage, in this case is $10.00, is rendered as a credit and excluded from the net family property calculation.
Blackburn Lawyers is made up of a team of dedicated lawyers who are pleased to provide support and guidance with your family law matters. If you and/or loved one has questions about date of marriage deductions, please contact our lawyers today.
Disclaimer: This blog sets out a variety of information relating to the law that is to be used for educational purposes and is not legal advice for your particular situation. The author of this blog does not intend for this blog to be a source of legal advice.
Written by: Adriana Totera
* Please note that the information in this article is not intended as legal advice, but rather as a general overview on the subject. If you are seeking legal advice, please consult with a lawyer.
