Imagine being two years into a divorce battle, fighting over child custody, fighting over who owns what and finding out that you aren’t protected by Alberta law.
This is the reality for some Albertans. Legal experts blame three weaknesses within the system; a system that is supposed to protect people who are splitting up.
The problems associated with Alberta’s Matrimonial Property Act include:
1. Common-law partnerships are not protected.
2. There is a lot of confusion about the valuation date of marital assets.
3. The act hasn’t had many substantial updates.
Several changes to the Act are being contemplated, and experts say none too soon.
The Alberta Law Reform Institute, an Alberta agency that advises the provincial government, is recommending updates that would finally include common-law partnerships in Alberta matrimonial law. The only time the Act applies now is when common-law parties agree to it. Valuation dates are another sticking point. Right now, couples can choose a date of valuation as either the date of separation or the date of trial. The problem comes when parties disagree, in which case Alberta law defaults to the trial date. The Institute recommends the default should instead be the date of separation. The valuation date is critical to couples because any property or assets individually acquired after the date does not have to be split with the other party.
Legal experts contacted by the Calgary Journal say people going through divorce should be aware of the Matrimonial Property Act, including who it applies to.
Erin Townley, a lawyer with McGurk Fraese Family Lawyers, says couples are unaware of the impact the Matrimonial Property Act can have on a marriage. Photo by Cassie Riabko
“When people decide to get married they do not know everything about the MPA, so that is why it can seem unfair and I think people don’t fully understand what they are entering into with marriage,” said Erin Townley, a lawyer with Davidson Fraese Family Lawyers in Calgary.
The Act was implemented in 1978 to ensure fairness of the division of property between divorcing parties. But there is a big gap. Alberta’s Act doesn’t include common-law partnerships, unlike several provinces that do.
“When an unmarried couple separates, either partner may apply to a court to divide property based on each partner’s contributions,” said Laura Buckingham of the Alberta Law Reform Institute, in an email. She added, “This approach can be unpredictable and inefficient.”
There have been minor revisions with the MPA, the latest in 2010. The Institute is collecting feedback and studying how the law concerning common-law partnerships could be updated with a report expected in early 2017.
DIVORCE RATES IN CANADA | In Canada, 46 per cent of marriages end in divorce, according to information provided by Statistics Canada and 37 per cent of marriages from 2008 are expected to end in divorce by the 25th wedding anniversary. In 2013, approximately 70,000 divorces occurred in Canada annually, according to Ontario-based family law office, Feldstein Family Law Group. There are no firm statistics from Alberta, as data collection and processing has been reduced.
Why a stronger MPA matters
Even with married couples dividing assets, divorces get ‘messy’ because expectations are set high and emotions take over. Talk to any divorce lawyer, and they confirm when couples fight over cutlery, pots, pans, dishcloths or chopsticks, it makes for a more challenging case for each lawyer. When getting married, the verbal agreement is a solidified contract. Family lawyer Erin Townley says lack of knowledge about the MPA further complicates matters.
Townley said, “I do always find the most interesting cases are common-law property because it is all over the map and the MPA doesn’t apply, unlike B.C. and Ontario where they have an equivalent act that includes the recognition of common-law couples.”
Changes to Come?
The Matrimonial Property Act may undergo big revisions based on recommendations from the Alberta Law Reform Institute, which is releasing a report, likely in 2017. The suggestions will go to the Alberta government, which must then decide whether to adopt or reject any changes.
Valuation dates: Case in point
Calgary family lawyer Holly Lonseth has worked with a client where the other partner had unilaterally purchased a condo with a line of credit from the matrimonial property mortgage without her client’s consent. However, Lonseth was able to find case law to present to the court that the new living space had no benefit of value to her client, which in turned helped with their side of the case. The case law that she presented was the Peregrym v. Peregrym and it stated: “The Court discussed a case called S.(E.) v. S. (J.S.) 2007 ABQB 321, which found, after considering the factors in section 8, that an unequal distribution was just and equitable because the husband’s debts incurred after separation were without the consent of the wife, did not benefit the wife, and it did not support any matrimonial assets.” This case law served as precedent for her case, resulting in her client’s favour.
Correction: An earlier version of this story featured a photo caption that incorrectly named Erin Townley sitting at her desk. It has been corrected. We regret the error.
Editor: Rosemary De Souza | rdesouza@cjournal.ca
This article has been updated to reflect the new name of Davidson Fraese Family Lawyers.