Property Division & Equalization
Can a Third-Party Creditor Have Priority Over a Former Spouse to Jointly Held Property?
September 15, 2023
Ontario’s Family Law Act sets out the regime for property division between spouses upon the breakdown of a marriage. Each person in a marriage is entitled to an equal value of the family property upon separation, with limited exceptions. Central to this regime is the calculation of each party’s net family property, which can become quite complex, particularly in situations involving high assets, complex trusts, investments, or shared business interests.
The dedicated family lawyers at Shariff & Associates will guide you through the equalization process and help you reach a fair and equitable resolution. Our firm has considerable experience representing clients in all types of property division disputes, from the relatively simple to highly complex. No matter how complicated your family’s financial interests, we can help bring clarity to your situation and ensure your assets are fairly divided and protected.
Net family property is the total value of each party’s property, both assets and liabilities, on the date of separation. This calculation excludes property owned by each party prior to the marriage. Notably, however, the value of the matrimonial home will be included, even if it was owned by one person prior to the marriage.
Once both parties’ net family property has been determined, the spouse with the greater property calculation will owe the other spouse an “equalization payment” of one half the difference between the two values.
While most property acquired during a marriage will be included in the calculation for equalization purposes, there are some limited exceptions. The following types of property are excluded from the calculation of net family property:
Notably, the property sharing provisions in Ontario’s Family Law Act do not apply to couples in common-law relationships. Equalization only applies to married spouses; however common-law spouses may have a right to property they have contributed to by way of a trust claim. The lawyers at Shariff & Associates can help you determine whether such a claim exists in your unique case.
When calculating net family property for equalization, it’s important that both spouses provide full and frank disclosure of all financial and property assets and liabilities. Our family lawyers are exceptionally experienced in reviewing assets and identifying potential red flags with respect to disclosure.
In complex cases or where hidden assets are a concern, we often retain the services of third-party experts, such as forensic accountants and business valuators to ensure all property values are fully accounted for and accurate.
The dedicated family lawyers at Shariff & Associates seek to ensure every client receives their fair share of net family property following a separation. While we encourage clients to engage in collaborative resolution processes, we are also trained and experienced litigators who will advocate for our clients’ interests in court when required. To review your matter with a member of our team, please reach out to us online, or call us at 905-591-4545.
September 15, 2023
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