Our years of experience helping clients divide “family assets” through the former B.C. Family Relations Act and “family property” under the current B.C. Family Law Act, has given us unique insight into the law in this area and how it has evolved in the past 30 years.
The division of “family property” is one of the most complex areas of family law and is always a very important issue. The outcome of this disputed issue will impact on a person’s present and future standard of living. You cannot afford to make a mistake.
In British Columbia, this area of law is now governed by the Family Law Act (since March, 2013). The Family Law Act defines two classes of property: “family property” and “excluded property.”
Subject to an excluded property claim (s. 85), “family property” is all real and personal property owned (or beneficially owned) by one of the spouses as of the date of separation, or such property acquired after separation, through the use of, or derived from the proceeds of, property owned prior to separation. Such property may include a share in a corporation, an interest in a partnership or business, pension benefits, trust benefits, and property derived from any of the above.
The following property is excluded from the definition of “family property”: pre-relationship property, inheritances, gifts from third parties, damages for injury or loss (other than loss of income), insurance pay-outs (other than loss of income or property loss), trust property, a beneficial interest in a discretionary trust (which the spouse did not settle or contribute to), and property derived from any of the above.
Unless modified by a domestic agreement, the Family Law Act provides that each spouse is, generally, entitled to equally share in all family property and is equally responsible for all “family debt” upon separation between spouses. This general statement of law stands regardless of the spouses’ respective contribution to the family property or family debt.
As family property is generally valued on the date of the domestic agreement or court hearing, the parties will presumptively share in any post-separation increase in the value of family property – this entitlement generally exists in spite of any post-separation contribution (Jaszczewska v. Kostanski, 2016 BCCA 286, para. 39).