The over-simplified understanding of the division of how property is handled in a divorce is “split everything right down the middle”. And while this is the essence of an ideal divorce (see our article, How is Property Split During a Divorce), one question that is often asked of our divorce lawyers in Mississauga is which assets need to be split, and which can be withheld from divorce proceedings?
Joint Assets
Anything jointly held must be evenly divided, regardless of when it was obtained. This applies to not only finances (such as stock portfolios) and property (such as houses), but to debt as well.
When it comes to joint assets, the two partners might not even be in a relationship for the same principals to apply; the same rules would govern two business partners who jointly run a business, or two neighbours who went 50/50 on a lawnmower.
Personal Assets Acquired During Marriage
As our previous article outlines in greater detail, any assets acquired over the course of a marriage are required to be taken into consideration in the resolution of a divorce. This can include both assets acquired and debts accrued over the course of the marriage.
Assets Acquired Prior to Marriage
If an asset was acquired prior to the date of marriage, then it is not counted towards divorce proceedings unless it is the matrimonial home. If an asset acquired prior to marriage gains in value throughout the marriage, such as a growing business or dividends earned from investments, the growth and payout are counted towards the divorce proceedings, while the original value is not.
What About Assets Acquired while Cohabitating?
While many might think that assets acquired while a couple is cohabitating before they marry would follow the same procedures as those acquired during marriage, this is most often not the case.
According to a 2002 decision by the Supreme Court of Canada (Nova Scotia (Attorney General) v. Walsh [2002] 2 S.C.R. 325), assets acquired during a common-law partnership prior to marriage are not covered under the Family Law Act. If one party feels that they have an interest in the assets on the basis of fairness, they can bring an application on trust law principles.
To schedule an appointment with our family lawyers or a divorce lawyer in Mississauga, give us a call or book an appointment. If you have any questions about family law, or any other type of law, please feel free to submit a question through our Ask A Lawyer.
