Tag: property rights of common law spouses
According to Statistics Canada, between 2006 and 2011 the number of common-law couples rose 13.9%, more than four times the 3.1% increase for married couples.
The trend is clear – more people are choosing to skip the formalities of a marriage and move in together. No cost, no ceremony, no family fights about who’s invited – plus, it’s really the same as marriage, isn’t it?
Not so fast…
Common law couples need to think very carefully about the what their union means from a financial perspective, especially as time passes, their assets grow, and children enter the picture. Because in many cases, it’s not the same as marriage.
Yes, from a tax perspective, the Canada Revenue Agency treats married couples and common-law couples the same. But looking beyond tax events to other life events, such as separation and eventually death, the treatment may be very different indeed.
This recent article provides an excellent summary of what can happen to assets when a common-law couple separates.
In terms of estate matters, the article below provides a clear overview of how estate laws differ across the country – and the impact of these differences on common law couples when one spouse dies.
In today’s world, it’s great to have a choice in how we form couple relationships. My only advice is that couples ensure they’re making an informed choice – and that they have a clear understanding of what their marriage or common law decision could mean in the future.
Thanks for reading,
Other Articles You Might Be Interested In
The Supreme Court of Canada recently considered the property rights of common law spouses in the companion cases of Kerr v. Baranow & Vanasse v. Seguin. These cases required consideration of the following legal issues:
- The role of the “common intention” resulting trust in claims by domestic partners.
- Whether the monetary remedy for a successful unjust enrichment claim must always be assessed on a quantum meruit basis.
- Mutual benefit conferral in the context of an unjust enrichment claim and when this should be taken into account.
- The role the parties’ reasonable expectations play in the unjust enrichment analysis.
In Kerr v. Baranow, a common law couple in their late 60’s split after 25 years, during which time both partners worked and contributed to their mutual welfare. The common law wife (“wife”) claimed property on the basis of resulting trust and unjust enrichment. The common law husband (husband”) counterclaimed that the wife had been unjustly enriched by his housekeeping and personal assistance after she suffered a debilitating stroke.
The trial judge awarded the wife $315,000, (1/3 of the value of the home the couple shared, but which was in the husband’s name) by way of resulting trust and unjust enrichment, because the wife had provided $60,000 worth of equity and assets at the beginning of their relationship.
The B.C. Court of Appeal allowed the husband’s appeal because it found the wife did not make a financial contribution to the acquisition or improvement of the property, and ordered a new trial for the husband’s counterclaim.
The Supreme Court of Canada allowed the wife’s appeal from the dismissal of her unjust enrichment claim and ordered a new trial. Her appeal from the order dismissing her claim in resulting trust was dismissed. The order for a new hearing of the husband’s counterclaim was affirmed.
Tomorrow’s blog will cover the facts in Vanasse v. Seguin and in our last blog of the week we will explore the main issues discussed in relation to property rights of common law spouses in the context of these two cases.
Sharon Davis – Click here for more information on Sharon Davis.