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  • Charles Baker

Common Law Spouses Can Be Required To Share Property Acquired During Their Relationship

Parts I and II of the Family Law Act, which deal with property and the matrimonial home, only apply to married couples. However, all is not lost for the common-law spouse who is deserved of sharing the property of his or her spouse. The courts, recognizing the unfairness to those who are unmarried, have crafted effective remedies or rights to “level the playing field.” In certain cases, including relationships of even a modest duration, a spouse may make a claim to share the property of the other through the legal doctrines of resulting trust, constructive trust, and unjust enrichment.

The presumption of resulting trust is a rebuttable presumption of law and a general rule that applies to gratuitous transfers. In other words, where one party transfers property to the other for no consideration, the law assumes that the party who received the property holds it “in trust” on behalf of the transferor. For example, if a spouse transfers his or her interest in a house to the other, for no money or not enough money, the law will assume that the transferee (the spouse who received the transfer) holds it on behalf of the one who transferred it.

Recently, the Supreme Court of Canada has released important decisions addressing the rights of unmarried couples to make property claims. These decisions expand what has been a long-standing trend to assist property claims by the unmarried. The law is complicated but, in short, and with the use of the remedy of a constructive trust, a trust relationship can be imposed as a remedy for a party’s “unjust enrichment.” Constructive trusts are the most effective for an unmarried spouse to obtain a legal interest in property owned by his or her former spouse.

In short, by expanding the principles of the existing law of “unjust enrichment,” by finding that there has been what is termed a “joint family venture,” a court can award an unmarried spouse:

1. A share of assets accumulated during the relationship;

2. An ownership interest in property where the spouse not registered on title can show a direct or even an indirect contribution towards the acquisition, maintenance, or preservation of the property; and

3. Financial compensation on a “fee for service” basis.

Considerations that go into determining whether there has been a joint family venture include mutual effort, economic integration, actual intent, and the priority of the family. Having children together can greatly strengthen these claims.

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