When a marriage ends, one of the most difficult parts of separation is figuring out property division in Ontario. This is not as simple as splitting everything down the middle. Instead, the law follows a process called Equalization of Net Family Property, which is designed to make sure both spouses leave the marriage with a fair share of the financial gains accumulated during the relationship.
It is important to understand that these rules apply only to married couples. Common-law partners are not automatically entitled to an equal share of property and may need to go to court to prove a right to certain assets. Working with a family law lawyer can give you clarity on what’s involved and how to make a claim.
Property Division for Married Couples in Ontario
Equalization of Net Family Property is based on comparing each spouse’s financial position at the start and end of the marriage. Each spouse must calculate their net worth as of the date of marriage and again on the date of separation. The difference between these two numbers is called Net Family Property. The spouse with the higher amount pays half the difference to the other spouse.
The matrimonial home is treated differently from other properties. Even if one spouse owned it before the marriage, the full value of the home at separation is included in the equalization process. Both spouses also have an equal right to stay in the home until it is sold, until there is an agreement between the parties (ideally in writing), or a court makes another order.
Excluded Property in the Equalization
Certain assets may not be included in a party’s net family property to be equalized if they can be kept separate and clearly traced. These can include inheritances or gifts received during the marriage, life insurance proceeds, settlement from an accident or injury, or property protected by a valid marriage contract. Your lawyer will confirm what you’re entitled to exclude from the property division.
Property Division for Common-Law Couples in Ontario
For common-law partners, property division works differently. Assets usually belong to the person who purchased them or who is on title. However, if you made direct contributions to the purchase of property that is in your partner’s name, the law may presume a ‘resulting trust’, which means the property is partly held for you. If instead you contributed through ongoing support, renovations, or household labour, the claim is usually based on unjust enrichment, which can lead to a constructive trust over the property.
Couples living together without being married can also protect themselves by creating a cohabitation agreement, which sets out how property will be divided if the relationship ends. A family law lawyer can help you draft an agreement that works for both partners.
If You Need Help Resolving a Property Dispute in Your Separation, We Can Help You Work Things Out
There are several ways for separating couples to resolve property division in Ontario. Some reach an agreement with the help of their lawyers and create a separation agreement. Others work through mediation or arbitration with a neutral third party. If no agreement can be reached, the matter may go before a judge, who will make a decision under the Family Law Act.
Because every situation is different, it’s important to have legal advice before making decisions about property. A family law lawyer can explain how the law applies, protect legal rights, and help negotiate a fair outcome.
At Scharff Nyland Chambers LLP, our team has extensive experience guiding clients through the challenges of property division in Ontario. Whether in Barrie, Collingwood, Wasaga Beach, or across the GTA, we work closely with families to reach practical solutions that protect their interests during separation and divorce. Give us a call at 1-866-721-5851, send us an email at reception@sncfamilylaw.com, or book a consultation on our website.
***The information provided in this blog is for general informational purposes only and should not be construed as legal advice. If you have legal questions, we strongly advise you to contact us.
