Monday, January 30, 2012 / by Justin Hoffmann
While some rules differ across the country, each province treats the matrimonial home as a unique asset that gives equal rights to both spouses.
It doesn't matter whose name is on the deed. The home cannot be sold or mortgaged, rented out or sublet unless both spouses agree.
"One spouse may legally own the home, but nevertheless, both spouses will be equally entitled to live in it," says lawyer Maxine M. Kerr of Newmarket, Ont. "If a relationship breaks down, the spouse owning the matrimonial home is not entitled to require the other spouse to leave it. Likewise, one spouse cannot unilaterally change the locks to a matrimonial home. This entitlement to equal possession can be varied only by court order or agreement (not including a marriage contract)."
In an interesting Ontario court decision, a man was awarded 50 per cent of the matrimonial home even though it was owned by his wife's parents. The parents purchased the home because the couple could not qualify for a mortgage. The parents said they intended their daughter and her husband would live in the home as tenants. But the court found that mortgage payments were made weekly by the daughter and her husband and that the couple held themselves out to be the owners of the home. The court determined that it was a "matrimonial home" under the province's Family Law Act, so the son-in-law was entitled to half interest in the property.
If a divorcing couple can't agree on who gets to live in the house or whether it will be sold, then an arbitrator or mediator can be called in, or the issue will head to court. In Ontario, couples who are contesting their family court cases will soon have to attend mandatory information programs that include methods to solve their differences through arbitration, rather than going to court. This applies only when there is a dispute about custody or the division of property, and has already been in place for some time in some municipalities.
If there are children, generally the spouse who has custody will be the one who stays in the home.
Kerr says that a court order for exclusive possession of a home is granted "only in limited circumstances" and that evidence of physical abuse or violence may be required.
In Alberta, a court order for exclusive possession is "not easy to get," says the Student Legal Services of Edmonton website, which is operated by the University of Alberta Faculty of Law. The site says it must be proven there's a good reason for the order and that the application isn't simply a matter of convenience. But an exclusive possession order doesn't change the legal ownership of the property. "This means that a person may have the right to stay in the house but it is still considered matrimonial property that may be divided by the court at a later date," says Student Legal Services of Edmonton.
"Selling the matrimonial home after a marriage breakdown is extremely complicated," says Barbara Sukkau, president of the Ontario Real Estate Association (OREA). "Even if they have agreed in the settlement who gets the home, or that neither will, there are a lot of decisions and steps that must continue to be made together on the property front."
For example, both spouses must sign off on documents such as the listing agreement and the agreement of purchase and sale. Again, even if one spouse is not a registered owner of the home, he or she must provide consent, says OREA.
"Another decision that must be made by both parties is whether or not renovations need to be done to the home to maximize the selling price," says the association. "The wish for one half of the divorcing couple to move on with the next phase of their life as soon as possible has to be balanced by the need by the other for cold hard cash to fund a new single lifestyle."
The definition of a matrimonial home differs from province to province. In Ontario, there may be more than one matrimonial home, such as a principal residence and a cottage. Couples who own more than one property can agree to designate only one as their matrimonial home but they must follow a specific procedure in Ontario. In Alberta, only the principal family home is considered a matrimonial home, according to Student Legal Services of Edmonton.
OREA says that Realtors have taken extensive training courses that include the study of family law. "As a facilitator, a Realtor will keep the lines of communication open, even it if means meeting with each spouse separately to ensure they both are comfortable with the process – and when necessary, directing the couple to consult with lawyers should there be any uncertainly," says OREA.
"A Realtor will ensure that couples are in the position to accept the best offer for their home when it comes by getting them to agree in advance on their rules and thresholds for accepting an offer," says Sukkau. "It can be extremely helpful to have a plan going in when the ability to negotiate or compromise is in short supply."
By Jim Adair