Q: I have built up a successful farming operation. I have recently become involved with a lady and I am hoping that marriage might be a possibility in the future. The lady I am seeing has little in the way of property or assets. I have been told that by marrying she will automatically be entitled to half my farm. Is this correct? If so, can we come to an agreement as to how to divide the property? I am concerned about raising the issue with the lady since it is a sensitive subject.
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Should I just make an appointment with a lawyer and both of us go to talk to the lawyer?
A: Marriage indeed brings matrimonial property laws into play. In most provinces, the law starts with the assumption that property between spouses will be divided equally when the marriage ends. In some provinces, a distinction is made between matrimonial property and business property, with the latter being divided based on the contribution of either spouse.
However, the courts have not given great weight to this distinction, holding that a contribution to household chores and child care is also a contribution to the business. The court will divide business assets equally.
There are exceptions to the equal division rule. Most provinces exempt the fair market value of property brought into the marriage by one spouse. Assume that Victor and Shae get married. Shae has land worth $250,000 at the time of marriage. They are married for 10 years during which time the land has increased in value to $500,000. Under the exception mentioned, the first $250,000 would be exempt from division. So Shae would be entitled to $375,000 and Victor the balance.
Agreements or contracts
Matrimonial property agreements or interspousal contracts are frequently used for situations like yours. The purpose is to set out rules for dividing the property upon the failure of the marriage other than what is set out in matrimonial property laws. Generally courts heed such agreements unless they are grossly unfair.
Thus an agreement stating that the wife will gain no rights to the farm no matter what contribution she makes will probably be ignored by the courts.
As indicated earlier, matrimonial property exempts the fair market value of property brought into a marriage.
However, 10 years later there can be considerable dispute as to what was the fair market value of the farm Shae had. An interspousal contract can list what each party is bringing to the marriage and the fair marketvalue of the same.
In order for such an agreement to be valid, both parties should consult separate lawyers. In most provinces such agreements are not valid unless each party has obtained separate legal advice and has acknowledged that he or she understands his or her rights.
Yes, discussing property rights and the possibility of a marriage breakdown when you’re courting is indeed a sensitive matter. However, it will be much easier to discuss this before a marriage, rather than after the wedding if problems develop.
While I’m not a marriage counselor, I suggest that this is something you should raise yourself first as opposed to walking into a lawyer’s office and hearing a lawyer lecture on property rights.
Perhaps you can suggest that given the seriousness of your relationship, it is time to consult lawyers to discuss obligations, including property rights, support and maintenance issues that might arise from marriage.
Don Purich is a former practising lawyer who is now involved in publishing, teaching and writing about legal issues. His columns are intended as general advice only. Individuals are encouraged to seek other opinions and/or personal counsel when dealing with legal matters.
