Family Law Act, R.S.O. 1990, c. F. 3
When two parties decide to separate and/or divorce it is usually the case that the value of all property acquired during the marriage, and the increases in value of that brought into the marriage, is equally divided between the spouses regardless of who holds legal title to it.
The preamble of the Act calls for the equal treatment of spouses. Marriage is viewed as a debtor/creditor relationship whereby each spouse contributes to and is responsible for child care, household management, earning an income, etc.
Furthermore, s. 5(7) states the following: “The purpose of this section is to recognize that child care, household management and financial provision are the joint responsibilities of the spouses and that inherent in the marital relationship there is equal contribution, whether financial or otherwise, by the spouses to the assumption of these responsibilities, entitling each spouse to the equalization of the net family properties, subject only to the equitable considerations set out in subsection (6).” As a result, upon marriage breakdown the spouses should be compensated for their contributions and left in a financially equal position.
The Family Law Act provides numerous rules which outline and detail the process and calculations that are to be completed in order to make a determination regarding equalization. However, this Act only applies to couples that satisfy the s. 1(1) definition of spouse.
Therefore, common law couples who acquire and share property do not benefit from the statute. In order to obtain some form of equalization, or to be compensated for any contributions made to the property during the relationship, a claim for either a resulting or constructive trust, or unjust enrichment may be made.
Although this may seem to be discriminatory or contrary to our Charter, a 2002 Supreme Court of Canada decision ruled that it is not. The court held that “although the statute treats common law couples differently from married persons the distinction does not affect the dignity of these persons and does not deny them access to a benefit or advantage available to married persons. The decision to live together is insufficiently indicative of an intention to contribute to and share in each other’s assets and liabilities. People who marry can be said to freely accept mutual rights and obligations. A decision not to marry should be respected because it also stems from a conscious choice of the parties.” For a detailed discussion of common law couples’ rights and division of property please see: Common-law Relationships and the Division of Assets.