8th March 2010

Non-Married Property by Kurt E. Schlachter

Non-Married Property
The first instalment of this article focused on the principles that apply to the distribution of matrimonial property.  In today’s society, however, many relationships have not been solemnized by the tradition of a formal marriage ceremony.  Unfortunately, for those couples, the law as it relates to property division is far less clear than it is for those who are married.

The first distinction is that the Matrimonial Property Act (“the MPA”) does not apply to their relationships given the absence of a marriage, which means the parties cannot rely on the provisions of that legislation to govern the distribution of their relationship property.  Accordingly, the automatic presumption of equal contributions to the relationship that exits under the MPA, and which accordingly entitles divorcing couples to an equal distribution of the matrimonial property, does not exist for non-married relationships.  As a result, a more complicated analysis using legal doctrines called constructive trust or resulting trust is required to fully assess the parties’ respective contributions to the relationship (financial or otherwise) and arrive at an equitable distribution of the relationship property.  If the analysis is undertaken properly, it is possible that an unequal distribution of the property could be made, depending on the details of the particular matter.  In other words, each case is largely driven by its own unique facts, and any decision the Court is called upon to make will turn on those specific facts.  Having said that, it also seems that in deciding most cases regarding the distribution of non-married relationship property the Court will attempt to apply the above-noted legal doctrines in a manner that will achieve an equal distribution of the relationship property, or as close to that result as possible.

Further assistance is available to non-married parties who own their residence in joint tenancy.  In such cases, the Law of Property Act can be relied upon.  Although the provisions of that legislation also call for a factual analysis of the parties’ respective contributions to the property in question, there also seems to be a presumption towards an equal distribution of the equity in the subject property by virtue of the joint tenancy, unless clear evidence can be introduced to establish that it would be unjust to do so, such as significantly unequal financial contributors to that property.

Although the concept of “exemptions” is not statutorily defined in the context of non married relationships, at least insofar as an exemption claim under the MPA is not available, such claims can be argued on the basis of the parties’ respective contributions to the relationship property using assets or resources that existed prior to the relationship.

Although in my opinion the status of the law relating to non-married relationship property is much less clear than that relating to matrimonial property, I have found that the majority of these cases settle because each party tends to face significant risk in their respective positions by either insisting on the strict application of the current legal principals to their situation or insisting on an equal distribution of the property in question by virtue of their relationship alone.
Kurt E. Schlachter


Written by Kurt Schlachter