What’s Yours May Not Be Mine…

Family property and excluded property under the new Family Law Act (“FLA”)

Are you affected by the new rules of property division?
“Spouse” now includes someone who is or was living in a “marriage-like relationship” with someone else for at least two years, and in a married relationship.
Married or unmarried, if you have had an exclusive relationship for at least two years, you are a spouse under the FLA.
If however, your relationship is less than two years, whether or not you have a child together, you are not spouses under the FLA, and the rules on property division upon breakdown of the relationship do not apply to you.

What is family property and what is excluded?
Family property is all property owned by either or both spouses at the date of separation. Family property is presumed to be shared equally between spouses, regardless of use of or contribution to that property.
Excluded property is property that is excluded from the pool of family property to be split between spouses. Excluded property is mainly property a spouse owned before the date of marriage or start of living together, plus certain kinds of property acquired during the spouses’ relationship, including: Property bought with the property which was brought into the relationship; Gifts and inheritances; and Insurance proceeds and court awards.
Excluded property is presumed to remain the property of the spouse who owns it. That spouse must prove that the property should be considered excluded property.

What about the increase in value of excluded property?
While the FLA says that excluded property is excluded from division of family property between spouses upon breakdown of the relationship, it also says that the increase in value during the relationship of excluded property is to be considered family property.

What about debts?
From the start to the end of the spousal relationship all debt incurred by either or both spouses is family debt. Responsibility for family debt is presumed to be equal between spouses, regardless of their use of or contribution to that debt.
Why are start and end dates of spousal relationships important? The date the spousal relationship starts is the date that separates the excluded property brought into the spousal relationship from the family property acquired during their relationship, and is the date when spouses begin to share responsibility for new debts. The date the spouses separate is usually the end-date for the accumulation of family property and shared debts. Start and end dates of a spousal relationship are particularly important when determining how much of the increase in value of excluded property is divisible as family property.

If you have questions about property rights in a family setting, contact Cohen Buchan Edwards LLP at 604.273.6411 to speak to one of our lawyers.

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