Property division and equalization are critical components of the separation and divorce process in Ontario. Understanding your legal rights and obligations is essential to ensure a fair outcome. At Chohan & Chatha LLP, we assist clients in navigating the complexities of Ontario’s family property laws. This article outlines the principles, procedures, and key considerations surrounding property division and equalization in Ontario.
Under the Family Law Act, married spouses are entitled to an equal share of the value of property acquired during the marriage. This concept is known as ‘equalization of net family property.’ The rules apply only to legally married couples, not common-law partners, who must rely on different legal principles such as trust claims.
Each spouse’s Net Family Property is calculated as follows:
- Add up all assets owned on the date of separation (excluding certain exceptions)
- Subtract the value of debts and liabilities on the date of separation
- Subtract the net value of assets owned on the date of marriage (excluding the matrimonial home)
The result is the spouse’s NFP. The spouse with the higher NFP pays half the difference to the other spouse. This is called the equalization payment.
Certain types of property may be excluded from the equalization calculation, including:
- Gifts or inheritances received during the marriage (unless co-mingled or used for the matrimonial home)
- Damages or settlements for personal injury
- Life insurance proceeds
Proper documentation is required to support any exclusion claims.
Special rules apply to the matrimonial home. Regardless of ownership, both spouses have equal rights to possession of the home during separation. Additionally, if a spouse owned the matrimonial home on the date of marriage and still lives in it on the date of separation, the full value is included in their NFP, with no deduction for the marriage-date value.
In rare and exceptional cases, the court may order an unequal division of property if equalization would be unconscionable. Factors considered include:
- Length of marriage
- Spouse’s financial mismanagement
- Debts incurred recklessly or in bad faith
- Any other relevant circumstances
The threshold for ‘unconscionability’ is very high, and these claims are rarely granted.
Common-law spouses are not entitled to automatic property division under the Family Law Act. Instead, they must pursue claims based on unjust enrichment, resulting trust, or joint family venture. These claims are more complex and require strong evidence of contribution and intent.
Whether negotiating a separation agreement or litigating a property claim, legal representation is essential. At Chohan & Chatha LLP, we guide our clients through the process with clarity and professionalism to secure their rights and entitlements.
The division of property and equalization of net family property are key aspects of family law in Ontario. Understanding the rules and seeking qualified legal advice can help ensure a fair and legally sound outcome. Contact Chohan & Chatha LLP to speak with our experienced family law team and get the guidance you need.
Stone v. Stone, (2001) 55 O.R. (3d) 491 (C.A.) [equalization of net family property, unequal division of net family property]
Rawluk v. Rawluk, [1990] 1 S.C.R. 70 [equalization of net family property, resulting trusts, constructive trusts]
Peter v. Beblow, [1993] 1 S.C.R. 980 [constructive trusts]
Serra v. Serra, 2009 ONCA 105 [unequal division of net family property]
LeVan v. LeVan, 2008 ONCA 388 [setting aside domestic contracts, unequal division of net family property]
Van Czieslik v. Ayuso, 2007 ONCA 305 [unequal division of net family property]
Pecore v. Pecore, 2007 SCC 17 [resulting trusts and presumptions]
Leitch v. Novac, 2020 ONCA 257 [partial summary judgment, invisible litigants, conspiracy]
Roberts v. Roberts, 2015 ONCA 450
Fielding v. Fielding, 2015 ONCA 901
Homsi v. Zaya, 2009 ONCA 322
Leskun v. Leskun, 2006 SCC 25
Hartshorne v. Hartshorne,2004 SCC 22
LeVan v. LeVan, 2008 ONCA 388
Rick v. Brandsema, 2009 SCC 10
Marinangeli v. Marinangeli (2003), 66 O.R. (3d) 40 (C.A.)
Virc v. Blair, 2017 ONCA 394 [inherent in the duty to disclose is duty to fairly value the asset]
G. v. K.G. and O.G., 2017 ONCA 108
Westerhof v. Gee Estate, 2015 ONCA 206, leave to appeal to the Supreme Court of Canada dismissed (2015)
White Burgess Langille Inman v. Abbott and Haliburton Co., 2015 SCC 23
Moore v. Getahun, 2014 ONSC 237, rev’d 2015 ONCA 55
Hryniak v. Mauldin,2014 SCC 7
British Columbia (Minister of Forests) v. Okanagan Indian Band, 2003 SCC 71
Biddle v. Biddle (2005), 13 R.F.L. (6th) 63 (Ont. S.C.)
Stuart v. Stuart(2001), 24 R.F.L. (5th) 188 (Ont. S.C.)
Ludmer v. Ludmer, 2012 ONSC 4478
Latcham v. Latcham (2002), 27 R.F.L. (5th) 358 (Ont. C.A.)
Silva v. Silva(1990), 1 O.R. (3d) 436 (C.A.)
Martin v. Martin(1992), 8 O.R. (3d) 41 (C.A.)
Batler v. Batler(1988), 67 O.R. (2d) 355 (H.C.)
Griffiths v. Zambosco (2001), 54 O.R. (3d) 397 (C.A.)
Higgins v. Higgins (2001),19 R.F.L. (5th) 300 (Ont. S.C.)
Rawluk v. Rawluk, [1990] 1 S.C.R. 70
Pettkus v. Becker, [1980] 2 S.C.R. 834
Peter v. Beblow, [1993] 1 S.C.R. 980
Campbell v. Campbell (1999), 43 O.R. (3d) 783 (C.A.)
Kerr v. Baranow, 2011 SCC 10 [clarifies the law on constructive and resulting trusts and unjust enrichment on the breakdown of domestic partnerships]
McConnell v. Huxtable, 2014 ONCA 86
Martin v. Sansome,2014 ONCA 14
Lasch v. Lasch(1988), 64 O.R. (2d) 464 (H.C.)
Bronfman v. Bronfman (2000), 51 O.R. (3d) 336 (Ont. S.C.)
Debora v. Debora (2006), 83 O.R. (3d) 81 (C.A.)
Burgess v. Burgess (1995),24 O.R. (3d) 547 (C.A.)
LeVan v. LeVan, 2008 ONCA 388, application for leave to appeal to the Supreme Court of Canada dismissed [2008] S.C.C.A. No. 331.
Serra v. Serra, 2009 ONCA 395
Islam v. Rahman, 2007 ONCA 622
A.M. v. D.M. (2003), 67 O.R. (3d) 181 (C.A.)
Boucher v. Public Accountants Council for Ontario (2004), 71 O.R. (3d) 291 (C.A.)
Fong v. Chan (1999), 46 O.R. (3d) 330 (C.A.)
Cindy Jahn-Cartwright v. John Cartwright, 2010 ONSC 2263
Cassidy v. Cassidy, 2011 ONSC 791
Jordan v. Stewart, 2013 ONSC 5037
Beaver v. Hill, 2018 ONCA 840
Mattina v. Mattina, 2018 ONCA 867
Rosen v. Rosen (2005), 2005 CanLII 480 (Ont. S.C.)
Thomson v. Thomson, [1994] 3 S.C.R. 551 [interpretation and application of Convention, wrongful removal]
A. v. M., 2002 NSCA 127 [child’s objection]
Jabbaz v. Mouammar (2003), 226 D.L.R. (4th) 494 (Ont. C.A.) [harm threshold]
Chan v. Chow, 2001 BCCA 276 [habitual residence]
Korutowska-Wooff v. Wooff (2004), 242 D.L.R. (4th) 385 (Ont. C.A.), leave to appeal to the Supreme Court of Canada dismissed [2005] S.C.C.A. No. 132 [habitual residence]
Katsigiannis v. Kottick-Katsigiannis (2001), 55 O.R. (3d) 456 (C.A.) [subjective approach to acquiescence]
Finizio v. Scoppio-Finizio (1999), 46 O.R. (3d) 226 (C.A.) [adjustment periods]
Pollastro v. Pollastro (1999), 43 O.R. (3d) 485 (C.A.) [determination of risk of harm]
Beatty v. Schatz, 2009 BCSC 707 [child to meet with psychologist], aff’d 2009 BCCA 310
Ellis v. Wentzell-Ellis, 2010 ONCA 347
R.M. v. J.S., 2013 ABCA 441 [objections of child]
Office of the Children’s Lawyer v. Balev, 2018 SCC 16 [habitual residence, time-limited consent, unilateral changes to child’s residence]
Ludwig v. Ludwig, 2019 ONCA 680 [child removed from jurisdiction, habitual residence]