Matrimonial Home and Title Rights

The Matrimonial Home and Title Rights

The matrimonial home and the Equalization of Net Family Property

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In Ontario, divorcing spouses are entitled to an "equalization of net family property". If you choose to apply to the court for a property division, that equalization will be done by the courts rather than settling it privately.

Upon the breakdown of a marriage, the Family Law Act takes a very specific view and imposes that view upon anyone who comes to court for an equalization. FLA's purpose is the "equitable sharing" of the net family property, and equal contribution is inherent in the marital relationship.

The general presumptions under the legislation encourages an equalization of your net family property absent some extenuating circumstances. A family lawyer can explain the process in more detail and give you a more tailored and strategic advice suited to your specific circumstances.

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Consent by the spouse

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Section 21 of the Family Law Act stipulates that no spouse shall dispose or encumber an interest in the matrimonial home unless the other spouse consents to the transaction.

If the consent is not obtained, and a purchaser purchases the property for good consideration at a marketable value, the transaction may be set aside by the courts. It is important to note that the transaction may be valid if the purchaser purchased the property without notice of it being a matrimonial home at the time of the sale.

If the property in question is the sale of a matrimonial property for a couple who is going through a divorce, it might be a good idea to let the purchaser know that the property in question is a matrimonial home.

Depending on the facts, one way to prevent the sale or any refinancing of a property for that matter by a spouse with sole ownership, could be to obtain a certificate of pending litigation and have it registered against title.

Certificate of pending litigation

If reasonable claims are put forward in an action for a constructive trust or a fraudulent conveyance in respect of a property, a certificate of may be issued pending trial.

In determining whether to impose a remedial constructive trust on grounds of unjust enrichment, the courts follow a two-stage process. First, they must determine that an unjust enrichment has occurred. Secondly, they must ask themselves whether it is appropriate to remedy the unjust enrichment through the imposition of a constructive trust rather than through some personal remedy[1].

Some of the factors which should be taken into account in considering whether to award a monetary amount rather than a constructive trust over property are: the relative value of the claim to the value of the property, whether the defendant can satisfy a monetary award without resorting to a sale of the property, whether the plaintiff has any special attachment to the property and whether any hardship would result to the defendant by granting a proprietary interest in the property to the plaintiff. [2] 

The registration of a certificate of pending litigation effectively prevents the disposition of the property prior to judgment. Consequently, a certificate of pending litigation “can be as effective as an interlocutory injunction in restraining dealings with the property[3].

Where the wife made a claim for an interest in the property that was owned by the husband’s parents and in which the husband and wife lived during their marriage, she established entitlement to a certificate of pending litigation[4] .

Registering a designation

There is also the possibility of registering a designation that the property is a matrimonial home and this will also prevent the spouse from selling the property without the consent of the other spouse.

A real estate lawyer can apply for a certificate of pending litigation or register a designation on the home.

‍Cases:

[1] Sorochan v.Sorochan 1986

[2] Lavigne v.Templeton 2000

[3] GPI Greenfield Pioneer Inc v Moore 2002

[4] Masci v Masci 2015

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Questions?

If you are thinking of getting a divorce or have questions about the process, feel free to contact Rose Law Firm. Please note that the above article is intended for informational purposes only, and is not to be construed as legal advice.Please consult with Rose Law Firm or another legal professional for legal advice related to your estate.

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