Common Law Relationships and Legal Marriages in Ontario
While the Canada Revenue Agency considers cohabitation for a period of at least 12 months continuously as common-law partners for tax purposes, this is not the same definition used for Family Law purposes in Ontario. In Ontario, partners are considered to be in a common-law relationship if they have been living together for a period of at least three years. This is shortened to a cohabitation period of one year if two partners have a child together, either naturally or through adoption.
Many people, including celebrity couple Oprah Winfrey and Stedman Graham, choose not to legally marry and live as common-law partners instead. However, the Family Law Act, specifically defines “spouse” as either of two persons who,
a) Are married to each other, or
b) Have together entered into a marriage that is voidable or void, in good faith on the part of a person relying on this clause to assert any right.
The Family Law Act further governs how property is divided between spouses, and calls for a property division regime (equalization of property) which effectively allows for both parties to walk away from the marriage with the same net worth. This division, or equalization of property, only applies to spouses as defined in the Act; common-law partners do not have the same benefit of property division under the Family Law Act as a legally married couple would. This is regardless of how long the common-law relationship was.
So, what is so special about the home? In Ontario the matrimonial home carries specific and unique traits in that it does not get a date of marriage on the breakdown of a common-law relationship, any property acquired during the relationship would be distributed in accordance with legal title and ownership. In other words, what’s mine is mine, and what’s yours is your.
The Courts have recognized the potential discrepancies and unfairness of denying common-law partners the same rights as married spouses. Take as an example two partners who, like Oprah and Stedman, have been long-time partners for over 30 years. Perhaps Partner A was not able to get approved for a mortgage, so together Partner A and Partner B agreed to put the family home in Partner B’s sole name. Both parties equally contributed towards the cost of the down payment, and for 15 years, Partner A and Partner B together shared the carrying costs equally.
Over the years, Partner A paid towards several renovations to the home, including a brand-new kitchen with a stellar island, hardwood floors, and upgraded appliances. These renovations significantly increased the value of the property. Upon a breakdown of the relationship, as the parties were never legally married, Partner A would not be entitled to property division under the Family Law Act, and since the property is in Partner B’s name only, Partner B could sell the home and retain 100% of the sale proceeds.
The courts have acknowledged the unfairness of the windfall that the spouse would receive. In our example above, the husband would receive. In order to remedy the obvious unfairness, Partner A has the ability to make a constructive trust claim under the common law. Specifically, Partner A may still have a right to the property notwithstanding they are not on title.
Aside from the discrepancy in property division, common-law partners have the same rights as legally married couples when it comes to spousal support and child support claims. To learn more about the rights and entitlements of common-law partners in Ontario, or have questions relating to the remedies available for common-law partners, please feel free to call us at 647-660-0080, or schedule a consultation online.