On January 1, 2020, the Matrimonial Property Act (the “MPA”) will be replaced with the Family Property Act (the “FPA”) providing much-needed rules with respect to the division of property in common law relationships.
Currently, those in common law relationships must resort to complex common law principles to govern how property is distributed upon relationship breakdown. With the introduction of the FPA, a statutory scheme will govern this distribution. These rules are important not only for common law couples but also for couples who lived together prior to marriage as the FPA deals with property that was owned or acquired during the time the parties lived together prior to marriage. This post deals primarily with common law relationships.
Will the Family Property Act (FPA) apply to my relationship?
Many of the provisions of the MPA have been extended to apply to Adult Interdependent Partners (AIPs). AIPs are defined by the Adult Interdependent Relationships Act as two people who live together in a relationship of interdependence:
- For at least 3 years;
- Of some permanence (and less than 3 years) if the couple has a child, or
- Who have entered into an adult interdependent partner agreement.
What is a “relationship of interdependence”?
The FPA adopts the criteria used in the Adult Interdependent Relationships Act, s. 1(2), which essentially states that a relationship will be determined by taking into account all of the circumstances of a relationship and the presence or absence of certain factors including, but not limited to, the degree to which the parties share their lives, financially or otherwise; whether there are children; how the relationship is represented to others; and the extent of direct and indirect contributions to each other.
The FPA will NOT apply to common-law relationships that breakdown prior to January 1, 2020 but will apply to current common-law relationships that breakdown after January 1, 2020. For those who are currently separating or planning to separate before January 1, 2020, the old common law rules will still apply to those relationships.
What are the requirements for bringing an application under the Family Property Act?
There are certain requirements that must be met before an application under the FPA can be brought. These include: a limitation period of 2 years; the AIPs must have become former AIPs pursuant to the FPA; and the parties must meet the residency requirements set out by the FPA.
I have met the requirements set out by the AIP – how will the FPA effect my property division?
The Family Property Act extends many of the same principles that now apply to married couples to couples who meet the definition of Adult Interdependent Partners as set out above. This means that, when the FPA comes into force, the same rules, presumptions, and exemptions will apply to AIPs, as follows:
- Common law couples will have a presumption of equal distribution of property acquired during the relationship upon relationship breakdown;
- Certain property will be exempt from distribution; and
- The same matters that are considered by the Court when distributing property subject to exemptions in marriages will now apply to common law couples as well.
You should contact a lawyer to discuss how these new provisions will apply to your property on relationship breakdown as there are several factors that will influence how your property is affected.
What if I don’t want the FPA to apply to my property?
As with married couples, if you don’t want the FPA to apply to your property, you can enter into an agreement setting out that you do not want the FPA to apply to your property on relationship breakdown. There are certain legal requirements that apply to such agreements in order for them to be valid. As such, you should consult with a lawyer to ensure you have an agreement that will be legally enforceable.
As the foregoing shows, property division on the breakdown of a common law relationship still remains a complex area of family law and it is essential to have experienced legal counsel to guide you through the process. At Richmond Tymchuk Family Law LLP, we have the necessary experience and knowledge to assist you in addressing this issue. Contact Us to learn how we can help you.