Divorce and the Matrimonial Home

Woman in the matrimonial home

Ontario law states that assets acquired by a spouse during marriage are divided equally between spouses. Moreover, any increase in the value of assets owned by a spouse at the date of marriage must also be split equally. There are a few exceptions to these rules, including inheritance and pensions. The exception which causes most often causes hardship, though, is the matrimonial home.

Learn how to separate your assets here.

What is a matrimonial home?

According to Section 18(1) of the Family Law Act of Ontario (FLA) a matrimonial home is a home which is owned by one or both of the married spouses and which is ordinarily occupied by the family at the date of separation. 

There can be more than one matrimonial home. For example, if one of the spouses owns a cottage in addition to their primary residence, and the cottage is frequently used by the family, the cottage is also considered a second matrimonial home. If, however, the cottage is primarily used by only one of the spouses, the cottage may not be deemed a matrimonial home.  

Finally, even if a home is not frequently used by the family in later years of a marriage, its use in earlier years may still deem it a matrimonial home. A 2009 Ontario Superior Court case found that extensive use of a property as a family home during the earlier years of a marriage can outweigh infrequent use by one of the spouses while the relationship is deteriorating in later years of the marriage.

How is the value of a matrimonial home divided?

Unlike other property brought into a marriage, in the event of divorce the entire value of the matrimonial home(s) is divided evenly between spouses, regardless of who the owner is or whether they purchased the home before or during the marriage. If only one spouse is on title to the house, then they are entitled to keep the house, but they must pay the other party half of the value of that house on the date of separation.

For example, imagine you bought a house for $200,000 in 2011 when you were single. You then got married in 2013 and your spouse moved in, making your home the matrimonial home. In 2015, you got divorced and the house was worth $250,000. Your spouse is entitled to $125,000, or 50%, of the value of the matrimonial home.

Can I continue to live in the matrimonial home after divorce? 

Under the Ontario Family Law Act, both spouses have a right to equal possession of the matrimonial home – which means that both spouses are entitled to live in the home. Therefore, even if one spouse owned the home before marriage, the non-owner spouse has the right to live in the house, even after separation.  The owner spouse can not do things like change the locks or sell the home without the express written consent of the non-owner spouse.

It is important to have a separation agreement in place before either party vacates the matrimonial home. It is not uncommon for people to remain in the same dwelling but to live separately. It is just as common for one party to vacate the home and move in independently. If this occurs the party who remains in the home may be required to pay occupation rent (see below).

What if my spouse and I can’t agree on who should live in the house after separation?

If you and your spouse can’t agree on who should continue to live in the house after separation, you can ask a court to decide for you. In situations like this, a judge will consider the following information before making their ruling:

                   -       How much money each spouse has

-       If the couple has any written agreements in place about the house

-       What is best for the children affected

-       If there are other places for the spouses to live

-       If there is a history of domestic abuse

In considering the best interests of the child(ren), courts will consider possible disruptive effects of a move on the child, as well as the child’s own views and preferences (given that these can be ascertained).

What is occupation rent?

If one party continues to occupy the matrimonial home while the other lives elsewhere it is likely that the party that moved is entitled to compensation for occupation rent. It is important to agree to what a fair rate for occupation rent is prior to moving out. This amount should be included in the separation agreement.

How do I sell the matrimonial home?

The matrimonial home represents the largest asset most divorcees possess. It is important that any sale be executed with the consent of both partners. To sell your home there are many steps, including: finding a real estate agent, hiring a real estate lawyer, and agreeing on a price.

Many lawyers will not release the proceeds of the sale until both you and your spouse have reached an agreement on the rest of your assets. This protects both sides from the assets being divided unfairly or one party from obtaining all the proceeds of the sale of the house and refusing to divide them.

Thinking about divorce

Some things to note:

Unequal Division of the Matrimonial Home is possible in special circumstances:

It should be noted that while the court’s automatic assumption is that property should be equalized between the parties, if the marriage has been short (usually five years or less), one party can ask the court to award an unequal division of property, so that they get more than 50% of the matrimonial property. This is usually done when one of the partners has drained the family assets by gambling or debts that the other spouse did not know about.

The Non-Residential Portion of the Matrimonial Home:

If the matrimonial home is located on land that is used for a purpose other than residential or if the family runs a business from their home, only the portion of the property that “may reasonably be regarded as necessary to the use and enjoyment of the residence” will be regarded as the matrimonial home. The remaining portion of the property will not be included as part of the marriage assets and, thus, the value associated with that portion of the property will belong entirely to the title owner

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