When couples divorce, they must divide their marital property. Although Ontario’s property division scheme seems simple, with each spouse sharing equally in the marriage’s profits, the reality can be more complex.
Common issues during asset division in Toronto range from choosing a separation date to calculating the value of your family property. These seemingly simple elements can significantly impact your financial position after divorce. Working with an experienced property division lawyer from The Riley Divorce & Family Law Firm with a sophisticated grasp of financial issues is crucial to ensure you receive the most advantageous settlement.
Two dates are critical when dividing the family property. One is the date of marriage, which is not controversial in most cases. The other is the date of separation or the valuation date. This date determines the value of the family property, and it can be a subject of fierce dispute.
For most divorcing couples, the valuation date is the date they separated with no reasonable expectation of reconciliation. If one spouse moved out and you never resumed sexual relations, the move-out date is the valuation date. However, many couples have brief reconciliation periods even after setting up separate homes, and calculating the valuation date in those circumstances can be challenging.
The choice of date is critical because it determines the value of marital property. The state of the stock and real estate markets, interest rates, and currency values on the separation date all impact the value of a couple’s holdings. When the valuation date is disputed, a Toronto lawyer could present convincing arguments supporting a date favorable to your financial interests.
Matrimonial homes are treated separately for property division. Any home where you reside as a family can be a marital home, and each spouse has an equal right to possess it. A couple with a cottage or vacation home can have multiple matrimonial homes, and each is subject to the special treatment afforded them.
Complications can arise when one spouse owns a home that the couple uses as a matrimonial home or when the spouse sells the home and puts the proceeds toward the marital home. In these cases, the other spouse has an equal interest in the home. This is true even when one spouse inherits a property that becomes the matrimonial home.
You both have an equal right to live in the marital home. Maintaining the children in their home is usually desirable when couples are parents. The spouse who takes on the children’s primary custodian would usually continue to live in the marital home and buy out the other spouse’s interest. In other common cases, the spouses in Toronto might live separately in the marital home until it is sold to a third party, and then the proceeds are divided equally.
Settling property division matters requires each spouse to deduct their net worth at the time of marriage from their net worth at the valuation date. The spouse with the enormous profit from the marriage pays half the difference to the other spouse, equalizing the financial benefit of the marriage.
The equalization payment does not need to be in cash. In many cases, liquidating an asset, selling a business, or dividing an investment interest is not advantageous. A skilled Toronto lawyer could craft a property transfer arrangement to equalize asset division.
Sometimes, dividing the family property equally is unfair. This situation arises most often when a spouse intentionally accumulates debt to reduce their net family property value, acquires debt through actions like gambling, or dissipates marital assets. The Ontario Family Law Act s.5(6) allows a judge to order an unequal division of family property if doing otherwise would be unfair.
Common issues during asset division in Toronto can derail a divorce proceeding smoothly otherwise. You need a capable lawyer you can rely on to anticipate and resolve them in a manner that favors your position.
The Riley Divorce & Family Law Firm provides the expertise you need whenever needed. We are available 24/7 to answer questions and provide support. Contact us now for a consultation.
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