Nanaimo Family Property and Debt
Nanaimo Family Property and Debt Division Lawyer
Generally, in British Columbia divorces and separations, each spouse is entitled to one-half of all family property and is liable for one-half of all family debt. Despite this deceptively simple equal division principle, not all property qualifies as family property and equal division may not occur if one party can prove it would be significantly unfair.
Nanaimo lawyer Sabrina Yeudall and Candid Legal work with professional appraisers, accountants, and actuaries to properly value family property and family debt, then work diligently with you to tailor a fair proposal or to evaluate proposals received from the other party. Through our knowledge and that of other qualified experts whose services we can retain on your behalf, we work to develop settlement agreements to meet your needs as part of the professional legal services we provide.
Dividing Family Property in a British Columbia Divorce or Separation
Generally, “family” property is property that was acquired during a marriage or marriage-like relationship of at least 2 years duration. It includes both property acquired during the relationship or an increase in the value of previously-owned property. Exceptions to family property include property acquired from gifts or inheritances, even when received during the relationship. In addition, property owned by one spouse prior to the start of the relationship is"excluded" property and not subject to division.
Business property and pensions are considered family property and are subject to division. In many cases the value of these and other specialized assets must be professionally assessed to determine an equitable division of the entire bundle of family property and family debt.
Proving what is family property and what is excluded property may require establishing value at points in the past, and tracing property through different forms. A common example of property that changes form, and one that is comparatively easy to trace through the years, is when a gift or an inheritance is used to finance a down payment on the family home.
More complex are cases where property that is properly excluded property has changed forms more than once over the duration of the relationship; for example, when that initial family home purchased in part with inheritance monies is sold and then a second home purchased, in part with the proceeds from the first home. Documentary evidence is often required. Recent case law suggests that should the property be transferred into the sole name of the other party, or perhaps even the joint names of the parties, then in some cases the right to exclude it from division on relationship breakdown may be lost.
If you wish to protect excluded property from division, you must be able to prove that the property qualifies as excluded. We can help you identify and gather the documentary and other evidence required to do so, and propose alternatives where the documentary record may have been lost.
The best protection is often the completion of a prenuptial or cohabitation agreement at the start of the relationship, as this provides an opportunity to document all previously-owned property and for the parties to agree on an appropriate value to assign to such property.
Dividing Family Debt in a British Columbia Divorce or Separation
“Family” debt is debt acquired by one or both spouses during the relationship. Debt incurred after the date of separation may be considered family debt where it can be shown that the debt was incurred for the purposes of maintaining family property (paying the mortgage on the family home, for example). Debt that a party brought into the relationship does not qualify as family debt.
The division of debt in an equitable manner can be difficult, especially where there is a great disparity in the incomes of the spouses. In addition, where debt has been incurred during the relationship in reliance on the joint incomes of the parties, creditors may be unwilling to remove the liability of one of the parties. In other words, your spouse could agree to be responsible for a particular debt, but should they fail to pay it, the creditor can still pursue you for repayment if your name continues to be linked to the debt.
When Equitable Division is Unfair
Equitable division of family property and property debt may not occur if one party can show that such a decision would be significantly unfair. For example, equitable division of assets may be unfair when one party has a significantly higher debt liability to third party creditors because it is their name that is on the debt, or when one party earns significantly less income than the other party.
Contact an Experienced Property Division Lawyer - Serving Families in Nanaimo and Throughout Vancouver Island
We invite you to contact Candid Legal if you need help with a property or debt division matter. You may request a consultation by filling out our online form, calling (250) 585-1595, or emailing firstname.lastname@example.org.