Marriage and personal finances
Emil Saumier is a black belt and fights in martial-arts competitions. He also runs an Ottawa martial-arts school where the students respectfully address him as “Sensei.”
But he was no match for a marriage breakdown. “It was like dying while still alive,” he recounts.
The divorce was particularly devastating in terms of his personal finances. He hadn’t paid much attention to how they were arranged. And he went into the separation largely unfamiliar with the family laws in his province.
Divorce is something we don’t like to think or talk about. But the fact remains: close to half of the marriages in Canada end up at this destination. Knowledge of family law in your province might come in handy — if only to provide motivation to be nicer to your spouse and avoid such outcomes!
Family law can have its unexpected twists and turns. What you might assume is the case isn’t always so. “Several jurisdictions have unique rules which can result in a division of property that can be very different than what the parties expected,” notes tax and estate lawyer Christine Van Cauwenberghe in her book, Wealth Planning Strategies for Canadians 2010.
Here are a number of things Van Cauwenberghe cautions people to be aware of:
1. Many people assume assets acquired before marriage are exempt from the division of assets. This is generally true, except:
- in some provinces including Ontario, Newfoundland, and Saskatchewan, a family home (and cottage) may be shareable even if it was acquired by one spouse prior to the marriage
- in B.C. and Nova Scotia, many different assets may be shareable even if they were acquired before the marriage
- assets acquired before the marriage can become shareable if they are used for family purposes
- prenuptial agreements can provide protection but some have been struck down by the courts when there was inadequate disclosure, duress at time of signing, and/or a limitation on spousal/children support to the extent it was viewed as unfair or detrimental (prenuptials drawn up by lawyers representing both sides are more likely to stand up)
2. Many persons also assume gifts and inheritances are separate from matrimonial assets but in some jurisdictions, they are not. And in those where they are separate, there are caveats such as the following:
- inheritances and gifts used to purchase family assets are shareable (especially if no records are kept and the funds are not invested separately in an account under the receiving spouse’s name)
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