Family Law with Tia Silver Surette
Does it matter whether a couple is just living as common law or if they marry? When considering property division when the relationship ends – absolutely.
Division of property when a marriage ends happens by means of the Matrimonial Property Act (MPA), which states that both parties are entitled to equal share of all “matrimonial property” regardless of who is the registered owner. One spouse can argue that certain property should not be shared equally, however the onus is on them to prove either that: 1) the property is protected from division because it is not matrimonial property (such as business assets or inheritances, for example); or 2) considering the circumstances of the marriage, there should be unequal division of property.
What about common law relationships? While living common law does make a difference in certain circumstances, such as when filing income taxes or having potential claims to pensions, property division is not automatically affected. The Nova Scotia Courts have ruled quite clearly that common law couples are not entitled to property rights under the MPA.
If a common law couple owns property as joint tenants, rest easy: the overriding presumption is always that joint tenants are entitled to equal share of that property. But when property used by the couple is only in one party’s name any claim to property by the other must be proven in court. Unlike under the MPA, the onus is on the party making an entitlement claim. One way this can be done is by proving that they made direct contribution of money and/or labour to the purchase or maintenance of the property.
It can also be proven through a claim of unjust enrichment, which requires the party to fulfill two tests: 1) proving a “joint family venture” by showing they lived as a family through mutual effort, integration of finances, prioritizing the family, and actual intent to do so; and 2) that their contributions to the venture deprived them while enriching the other party by allowing them to accumulate assets or wealth without there being a juristic reason for doing so (for example: making a gift without intention of being compensated, or by contract). The most common argument for unjust enrichment is when one of the parties stayed home to raise the kids, allowing the other to focus on growing their business.
It is quite the rigmarole for a common law spouse to prove entitlement to their ex’s property. What can you do if you want to protect your property interest while you are still in a relationship without getting married?
- The property owner could transfer the title to both parties in joint tenancy, creating a presumption of equal shares. Unfortunately, this is not always feasible when mortgage lenders are involved.
- Parties can enter into a cohabitation agreement, which outlines their various rights and obligations should the relationship end. Not only is this beneficial to determine property claims, but it can allow couples to determine all issues, such as spousal support, before the relationship sours.
- The couple can register as a “domestic partnership” under the Vital Statistics Act. This gives the couple full rights and obligations under the MPA as if they were married – a convenient option for those who want to be treated as married under the law but do not want to go through the hassle of a wedding. It should be noted, though, that termination of a domestic partnership is not automatic when couple breaks up. It requires the parties to file a statement terminating their partnership, to live separate and apart for more than one year knowing the relationship in over, one party marrying another person, or to register a separation agreement with the Court.
This article is for information only and is not intended to be legal advice. If you have any questions or would like further information, you should consult a lawyer.