Home & Property

Other Family Property

Under The Family Property Act family property or its value is to be divided equally. Family property includes any property owned by one or both spouses at the time an application is made under the Act. However, as discussed in The Family Property Act section there are some exemptions that apply to all family property other than the family home and household goods.

Exceptions

The court can move away from an equal distribution of family property if it is satisfied that an equal distribution would be unfair. The circumstances when the court can order an unequal distribution of the family home, as opposed to an unequal distribution of other family property, are different and very limited. See Family Home for more information. In deciding if it would be unfair to divide family property equally, other than the family home, the court considers a number of factors, including…

Valuing Family Property

If spouses ask the court to make an order dividing property they will be required to provide detailed information about what family property they have, the value of that property and any debts. If spouses want to make an agreement concerning family property this information will also be needed.

The value that is used is the market value. This means what the asset would sell for. It is not the replacement cost of the asset, so if the asset is not new it will not be the price to buy a new one. The exact amount that an asset will sell for can never really be determined unless it is sold. Spouses may choose to begin with their own best estimate of what an asset is worth. Other people such as real estate agents, for real property such as houses, and dealers, for things like vehicles, may help people to determine the market value of an asset. Looking at what used items that are similar sell for online or through other means can also be helpful.

Dealing with Debts

Although debts are not family property they will be taken into account when family property is divided. The total amount of all debts may be subtracted from the total value of all family property and the remaining value divided or one or the other spouse may be ordered to or agree to take responsibility for certain debts. For example, if one spouse is going to be awarded the asset they may also take responsibility for any debt, such as a mortgage, associated with the asset.

It is important to remember that lenders are not bound by an agreement or a court order regarding a debt. While the spouses may agree or the court may order that a spouse is responsible for a debt a lender is not required to remove the other spouse from the loan agreement. If both spouses signed the loan or the agreement then as far as the lender is concerned they are both still responsible for the debt, unless the lender agrees to remove one spouse’s name. A lender may be unwilling to give up the security of having both spouses be responsible for the debt.

If your spouse is supposed to have responsibility for a debt, by agreement or court order, but the lender will not remove your name, your spouse will usually also agree to or be ordered to indemnify you. This means that if you have to pay the lender your spouse would have to reimburse you for this cost.