A FAMILY LAWYER IS CRUCIAL TO THE FAIR DIVISION OF MATRIMONIAL ASSETS AND DEBT
Determining assets and splitting them equally often causes stress and conflict. A lawyer knows your rights, and will help you make good choices.
Over the course of a marriage, a couple will have accumulated various assets and debt. As such, when a couple is divorcing, a fair and equitable division of matrimonial property is necessary. However, what constitutes a fair and equitable division of property is an item that many divorcing couples will find most difficult to negotiate.
The Alberta Matrimonial Property Act, or the MPA, deals with the separation of a married couple’s property. In Alberta, the assumption is that the matrimonial property will be divided fairly when the spouses enter into a property agreement or receive a property judgement. An RCMV Divorce Lawyer or Mediator can help you navigate the intricate rules and exceptions you need to know during your divorce and subsequent property division.
The Matrimonial Property Act is only relevant in Alberta, and only applies to married spouses, not common-law couples. A claim to divide property can be made independently, or within another claim, such as a divorce.
Below, we’ve compiled a few important answers to commonly asked questions regarding the division of property:
- What is Matrimonial Property?
- What is the Matrimonial Property Act?
- Are there any exceptions to the Matrimonial Property Act?
- Am I responsible for my spouse’s debts?
- What date is used to determine the value of matrimonial assets and debts?
- If I am not aware of my spouse’s assets, how can I get this information?
- Does my name have to be listed as an owner of a marital asset in order for me to be entitled to a portion of its value?
- For a division of matrimonial property, do I apply in the Court of Queen’s Bench of Alberta or the Provincial Court of Alberta?
What is Matrimonial Property?
Matrimonial property includes all property acquired by either spouse during their marriage. Typically, this property is divided equally during a divorce, unless it would be unfair to split it this way.
Matrimonial Property includes items such as:
- the matrimonial home
- household goods
- RRSPs and employment pensions
- business interests
- investments, stocks, bonds
- property used for the mutual benefit of the spouses
- property purchased during the marriage
- property brought into the matrimonial relationship
What is the Matrimonial Property Act?
In Alberta, when married couples separate, division of the assets and debts accumulated between them is governed by legislation called the Matrimonial Property Act, R.S.A. 2000, c. M-8 (hereinafter the “MPA”), which can be found online on CanLii or the Queen’s Printer websites.
Note that the MPA does not apply to common law partners, rather it only applies to legally married spouses.
The general rule under the MPA is to review the property and debt accumulated by the spouses during their marriage and to divide them equally. There are however, some exceptions to that rule.
Are there any exceptions to the Matrimonial Property Act?
There are a few instances where the Matrimonial Property Act rules of equal division do not apply, including:
a) property acquired by one spouse before the marriage
d) awards or settlements that are designated for one spouse, such as money paid for pain and suffering in an auto accident.
Here is how Calgary Courts will make decisions on these instances:
- If property was owned by one party before the marriage and:
- the property still exists at the time of separation or divorce,
- there is a paper trail showing how a new property was acquired with the proceeds from the previously owned property, then the value of this type of property as at the date of marriage is not divisible. However, an increase in the value of the prior owned property will in most cases still be shareable on a just and equitable basis.
- the property still exists at the time of separation or divorce,
- If property is acquired by one of the spouses during the marriage by way of a gift from a third party, inheritance, damages in tort, or proceeds of non-property based insurance properties, the value of that property at the date of acquisition (provided it still exists or is traceable to new property acquired with the income or proceeds), is not divisible. However, an increase in value of the prior owned property will, (in most cases), be sharable on a just and equitable basis.
If during the marriage, one of the spouses purposefully damages the property, or transfers property to a third party in order to defeat his or her spouses’ matrimonial property claim, the Court can award a greater share of the remaining property to the other spouse.
Am I responsible for my spouse’s debts?
Typically, the debt accumulated by the spouses between the date of marriage and the date of separation is equally divided. In certain circumstances where you can show that debt was accumulated for a purpose outside of the normal course during the marriage, the courts can award the other spouse an unequal division of the balance of matrimonial property. For example, if there was a gambling debt where the gambling problem was unknown to the other spouse, the courts can decide to leave the incurring spouse responsible for the debt.
All matters rest on their own specific facts though so make sure to give your lawyer all the details you have about the matrimonial debts so that you can get a proper opinion as to whether or not you will be made responsible for your spouse’s debts.
What date is used to determine the value of matrimonial assets and debts?
In Alberta, our Courts must value assets as at the date of trial. This principle was confirmed in the 1981 Alberta Court of Appeal decision of Mazurenko v. Mazurenko 1981 ABCA 104.
For this reason, it is wise to settle your matrimonial property matters sooner rather than later. The longer you wait to resolve division of matrimonial property, the greater the risk that the asset and debt position of the parties will have drastically changed between separation and trial (i.e. one spouse may have accumulated or disposed of significant amounts of matrimonial property in the intervening period between separation and trial).
If I am not aware of my spouse’s assets, how can I get this information?
On of the first steps in any family law file involving division of matrimonial property, is for each party to exchange disclosure of their incomes, assets and debts. This can be done either voluntarily or by application to the Court of Queen’s Bench. The Application is called a Notice to Disclose Application and it requires the Respondent to provide a list of records to the other party within a short timeframe of not less than 30 days from the date of receiving service. If the list of documents is not produced, the Applicant may apply to the Court for various relief, including an order requiring the Respondent to produce by a certain date, imputing the Respondent’s income for support purposes and other useful relief.
Does my name have to be listed as an owner of a marital asset in order for me to be entitled to a portion of its value?
No. Under the Matrimonial Property Act, spouses are entitled to divide (either equally or equitably depending on the type of property and the circumstances of the parties) all of the assets of their spouse, whether the assets are held jointly by the parties, solely by the spouse or even jointly by the spouse and third parties (as to the spouses share of such jointly held assets).
For a division of matrimonial property, do I apply in the Court of Queen’s Bench of Alberta or the Provincial Court of Alberta?
The Court of Queen’s Bench of Alberta is the appropriate venue to apply for a division of matrimonial property. This is done by filing a Statement of Claim for Division of Matrimonial Property, or a combined Statement of Claim for Divorce and Division of Matrimonial Property.
The Provincial Court of Alberta does not have jurisdiction to decide matters of matrimonial property division.