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Medicine Hat, AB., Canada
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1. Basic rule
1.1 All property acquired during the marriage, regardless of whose name it is in, is subject to equal sharing - unless it meets one of the categories of exemptions or unless the Court finds that it would not be just and equitable to divide it equally.
1.2 There are three categories of property - shared property, exempt property and equitably divided property.
2. Exemptions
2.1 There are 3 categories of exceptions -- the legal term is "exemptions":
• property that either spouse had prior to the marriage
• a gift or inheritance to either spouse
• any insurance proceeds that do not relate to property -- for example a claim for personal injuries as a result of an automobile accident
2.2 These are "potential" exemptions as they are subject to the a few rules:
• the property must exist in property today (i.e. if a gift is spent during the marriage, it is no longer an exemption)
• the exemption must be "traceable"
• the exemption must not have been added to the "matrimonial regime" (for example, if a gift of money is deposited into a joint bank account, some or all of the exemption may be lost)
2.3 The general rule is that if "exempt" property is transferred into joint names, the person loses one-half of the exemption -- so 1/2 would retain the exemption and 1/2 would be shared between the spouses
3. Equitably divided property
3.1 "Equitably" divided property is:
• the increase in value (during the marriage) of exempt property
• property acquired by a spouse with income received during the marriage from exempt property
• property acquired by a spouse after a divorce judgment, a declaration of nullity or marriage or a judgment of judicial separation
• property acquired by a spouse by gift from the other spouse
3.2 The Matrimonial Property Act sets forth 12 factors to consider in applying the "just and equitable" rule and then adds a catch-all: "any fact or circumstances that is relevant".
4. Dissipation
4.1 The Act allows the Court to make interim Orders where property has been dissipated or there is a real likelihood that there will be dissipation in the absence of an Order.
4.2 Any claim regarding dissipation has to be made within
• two years after separation or
• one year after any property was transferred (resulting in the allegation of dissipation) whichever is first.
5. Agreements
5.1 Spouses can reach their own Agreements about matrimonial property division and avoid Court.
5.2 The following conditions are necessary for a binding and legally enforceable matrimonial property Agreement:
• there must have been full disclosure of assets and liabilities
• each spouse must be signing the Agreement freely and voluntarily without duress
• each spouse must have the mental capacity to understand what they are doing and to enter into an Agreement
• each spouse must have independent legal advice (a lawyer who is not his/her spouse's lawyer) and the proper certificates regarding independent legal advice must be completed and attached to the Agreement - this means that the spouse must be fully aware of the "nature and effect" of the Agreement and that the spouse must also be aware of possible claims to property that he/she may have and willing to give up those claims to the extent necessary to give effect to the Agreement
• the spouses must sign the Agreement in the presence of the lawyer who is giving them independent legal advice and NOT in the presence of the other spouse
6. General time limit for application
6.1 If a couple is divorced, and:
• they do not enter into a legally binding Agreement as set out above, and
• they have not had their matrimonial property dealt with by a Court Order, then if they do not commence an action within two years from the date of the divorce Judgment, they cannot do so.
6.2 Some people who have very little property and therefore are "low risk" choose not to enter into a matrimonial property Agreement and to simply wait out the 2 years, knowing that their property is at risk of a claim for those 2 years.
© Marilyn Herrmann
This information was provided as a courtesy by Niblock & Company LLP for information purposes only and should not be taken as legal advice. You should not rely on, or take or fail to take any action based on this information. If you need legal advice, contact Niblock & Company LLP or a lawyer of your choice to obtain advice that is particular to your situation. The provision of this information does not create a solicitor/client relationship.