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Common Law Issues The law regarding common law relationships is different than in cases of divorce. Discuss the issues that affect unmarried couples here.

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  #1 (permalink)  
Old 09-27-2016, 03:53 PM
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Good day folks.

I've been reading this forum on/off for years and I thought I had a good grasp on how the courts approach common law relationships; however, a friend is currently ending a long term (19 years) common law relationship, and I am surprised by what his lawyer is telling him.

The lawyer is saying that, due to the length of the common law relationship, the court will treat them like they were married. This means equalizing all property and she will be automatically entitled to SS. Is there any truth to this?

Some background:

They live in ON, and always have for the full duration of cohabitation.

He's 46, university educated and makes significantly more than her. Employed full time and always has been. No issues with health.

She's 45, college educated and makes about $95,000/year. Employed full time and always has been. Her career progressed to a manager position during their cohabitation. No issues with health. She has one child (now 27 and not living at home) from a previous relationship that my friend treated as his own (locus parentis).

They jointly own a home that recently sold for $600,000. They intend to split the equity. He plans on giving her all the furniture.

They have independent RRSPs. His has significantly more than her. Based on what his lawyer is saying, he's prepared to give her $75,000 of his RRSPs.

And finally, his lawyer says that SS will be automatic and for life. Based on the online calculator, the mean amount is just shy of $2,000/month.

The SS is what really bothers me - about $2,000/month for life simply because the common law relationship was long term (19 years).

Is there any merit to what the lawyer is saying? I'm familiar with the idea of unjust enrichment/constructive trust, but I don't see it as applicable in this case. I also don't see any entitlement for SS based on compensatory nor non-compensatory reasons. Am I missing something here?
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Old 09-27-2016, 06:02 PM
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The lawyer may just be telling him a worst case scenario so he's prepared?

I know sometimes in common-law relationships that SS applies, but it certainly isn't automatic. And I can't imagine that a woman making $95k, whose career was not impacted by the relationship, can prove any entitlement to SS.

Keep in mind those online calculators ONLY give you a range of numbers, in the event of entitlement. They do NOT imply that there is entitlement.

Technically, they should divide the house, but not the RRSPs.

Look on CanLII for cases involving long-term common-law relationships. See if there is anything to substantiate your lawyer's prediction.
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Old 09-27-2016, 11:32 PM
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Quote:
Originally Posted by Rioe View Post
I know sometimes in common-law relationships that SS applies, but it certainly isn't automatic. And I can't imagine that a woman making $95k, whose career was not impacted by the relationship, can prove any entitlement to SS.
My thoughts exactly. Her career was never impacted, so no compensatory claim, and she makes $95K/year, so I can't see how she could successfully argue a "need" for more, which eliminates a non-compensatory claim.

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Originally Posted by Rioe View Post
Look on CanLII for cases involving long-term common-law relationships. See if there is anything to substantiate your lawyer's prediction.
I've been looking, but it has been difficult to find anything. I found some long term common law cases, but there was also factors such as young children involved, compensatory grounds for SS based on career sacrifice, inability to work or very low income, etc.

Based on what my friend tells me, the lawyer is telling him to setlle out of court, and give her half the assets and SS.
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Old 09-28-2016, 10:17 PM
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I'll give a slightly different possible perspective.

Quote:
Originally Posted by HalifaxGuy View Post
She has one child (now 27 and not living at home) from a previous relationship that my friend treated as his own (locus parentis).
That makes them effectively the parents of the child. The fact that the child is older now is relevant to CS, but not SS. It is possible that she sacrificed her career to take care of their child. It is possible that the father's career would not have been as successful if he had to spend more time taking care of the child.

Quote:
He plans on giving her all the furniture.
Unless the furniture is made of solid gold, that gesture is not generally seen as being as magnanimous as you may believe. Furniture often has a very low resale value, and that is the value that matters.

Quote:
They have independent RRSPs. His has significantly more than her. Based on what his lawyer is saying, he's prepared to give her $75,000 of his RRSPs.
He owes her half of the increase of the value of his RRSP's. That may be more or less than $75,000. Over the course of a 20 year marriage, I suspect that is a serious lowballing of the value.


Quote:
The SS is what really bothers me - about $2,000/month for life simply because the common law relationship was long term (19 years).
The SS is for her sacrificing her potential career opportunities over the course of their 20 year relationship. It is also for her giving him the opportunity to advance his career without the worries of parenthood since she took care of the child.

That said, SS probably won't be for life, but 15 years of SS seems reasonable.

Quote:
He's 46, university educated and makes significantly more than her.
A 20 year relationship, a substantial disparity in income, a child of the relationship. It is inevitable that their finances became intertwined over the two decades that they were together.

Quote:
I also don't see any entitlement for SS based on compensatory nor non-compensatory reasons. Am I missing something here?
I think she has a good legal case for SS. They were effectively one person. She has need, he has means, and she might even have compensatory reasons for obtaining SS.

And don't forget he still owes her half of the increase in his RRSP's on top of the SS.

Maybe he should consider keeping half of the furniture.
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Old 09-28-2016, 10:42 PM
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Quote:
Originally Posted by Janus View Post
That makes them effectively the parents of the child. The fact that the child is older now is relevant to CS, but not SS. It is possible that she sacrificed her career to take care of their child. It is possible that the father's career would not have been as successful if he had to spend more time taking care of the child.
She did not sacrifice her career to take care of the child. She worked full time during the entire relationship and progressed to a management position. She currently makes about $95K per year. As I stated in my OP, they both progressed their careers throughout the relationship.

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Originally Posted by Janus View Post
He owes her half of the increase of the value of his RRSP's. That may be more or less than $75,000. Over the course of a 20 year marriage, I suspect that is a serious lowballing of the value.
Why would he owe her half the value? Are you confusing common law with marriage. The court may award her some of his RRSPs, but that's not automatic, and she has to prove how she contributed to those RRSPs (i.e. constructive trust).

Quote:
Originally Posted by Janus View Post
The SS is for her sacrificing her potential career opportunities over the course of their 20 year relationship. It is also for her giving him the opportunity to advance his career without the worries of parenthood since she took care of the child.
That is sheer conjecture on your part. As I stated previously, her career progressed throughout the relationship. His did too. They are both career oriented individuals. They both have good jobs and make good money. Your statement above is an all too typical narrative in family court, regardless if there is any evidence to support it.

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Originally Posted by Janus View Post
I think she has a good legal case for SS. They were effectively one person. She has need, he has means, and she might even have compensatory reasons for obtaining SS.
She makes $95K per year and she has a "need" for SS? If that holds true, what has the world come to??

As mentioned above, there is no compensatory grounds, as she didn't sacrifice her career. Contrarily, her career progressed and she's not far from the "sunshine list".
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Old 09-28-2016, 11:13 PM
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Quote:
Originally Posted by HalifaxGuy View Post
She did not sacrifice her career to take care of the child. She worked full time during the entire relationship and progressed to a management position. She currently makes about $95K per year. As I stated in my OP, they both progressed their careers throughout the relationship.
The question is not whether she progressed. The question is how did her progression compare to her hypothetical progression had she not been married.

I work full time, and my career has certainly suffered because I have children. There are opportunities that I have not been able to take because I need to attend to my children's needs. My colleagues without children certainly have a more upwardly mobile career track.

Full time is not equivalent to "unaffected".

Quote:
Why would he owe her half the value? Are you confusing common law with marriage. The court may award her some of his RRSPs, but that's not automatic, and she has to prove how she contributed to those RRSPs (i.e. constructive trust).
They had a 20 year relationship. I suspect it won't be difficult unless they had a very rigorous separation of finances. The child also mucks it up quite a bit. You should never be nice to somebody else's children, it always comes back to bite you in the ass.

Quote:
That is sheer conjecture on your part. As I stated previously, her career progressed throughout the relationship. His did too. They are both career oriented individuals. They both have good jobs and make good money. Your statement above is an all too typical narrative in family court, regardless if there is any evidence to support it.
That is my point, family court will award SS based upon pure conjecture. If you wanted to complain about it, you should have posted in the political subforum of this site.

Quote:
She makes $95K per year and she has a "need" for SS? If that holds true, what has the world come to??
Need is relative. If one partner makes $2 million a year, and the other makes 170k a year, then the latter spouse has great need.

Quote:
As mentioned above, there is no compensatory grounds, as she didn't sacrifice her career. Contrarily, her career progressed and she's not far from the "sunshine list".
You will find that simply stating "she didn't sacrifice her career" doesn't make it true.

The sunshine list is irrelevant. She could be making twice her salary and still have need and still be entitled to compensatory SS.

How much does he make? How big is this disparity in income?
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Old 09-29-2016, 12:00 AM
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Quote:
Originally Posted by Janus View Post
The question is not whether she progressed. The question is how did her progression compare to her hypothetical progression had she not been married.

I work full time, and my career has certainly suffered because I have children. There are opportunities that I have not been able to take because I need to attend to my children's needs. My colleagues without children certainly have a more upwardly mobile career track.

Full time is not equivalent to "unaffected".
You keep using the term "married" for my friend's situation. They were not married.

Perhaps her career did suffer. Perhaps his did too? If the conclusion is that he did act in place of a parent, then your example above can easily apply to him too.

Keep in mind that my friend lived with the child when the child was aged 9-18. I originally said the kid was 27, but that was a mistake - he's 29 now. Is my friend responsible for all the hypothetical missed opportunities she had when the kid was 0-9?

Also note from my OP that the lawyer was saying SS was automatic due to length of the common law relationship and the income gap between them. Nothing about compensatory.

Quote:
Originally Posted by Janus View Post
That is my point, family court will award SS based upon pure conjecture. If you wanted to complain about it, you should have posted in the political subforum of this site.
If that was your point, then you should had stated that the family court makes decisions based on pure conjecture. You presented it as your position.

Quote:
Originally Posted by Janus View Post
You will find that simply stating "she didn't sacrifice her career" doesn't make it true.
And simply stating that she did sacrifice her career doesn't make it true either.

Based on what you said above, truth doesn't matter anyway.

Quote:
Originally Posted by Janus View Post
Need is relative. If one partner makes $2 million a year, and the other makes 170k a year, then the latter spouse has great need.

The sunshine list is irrelevant. She could be making twice her salary and still have need and still be entitled to compensatory SS.

How much does he make? How big is this disparity in income?
He makes about $165,000/year.
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Old 09-29-2016, 11:37 AM
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Originally Posted by HalifaxGuy View Post
You keep using the term "married" for my friend's situation. They were not married.
He wasn't the kid's father either.

After 19 years, I think the difference between married and common law is more technical than real, at least in Ontario. Different legislation is quoted of course, but results don't differ much.

Quote:
Perhaps her career did suffer. Perhaps his did too? If the conclusion is that he did act in place of a parent, then your example above can easily apply to him too.
He earns more, so clearly it impacted him less.

Before you tell me that it doesn't make sense, save your breath. I just read a judgment where a father had one kid full time, one kid half time, and the judge ordered a straight setoff CS. In terms of math, that is almost pure fantasy.

Quote:
Is my friend responsible for all the hypothetical missed opportunities she had when the kid was 0-9?
Nope, just the missed opportunities from 9-18. Now, I guess a judge can delve into the record and try to apportion the costs and missed opportunities of the marriage, or the judge can take a look at the SSAG and just order slightly less than midrange support. One approach takes hours, the other takes 30 seconds.

Don't expect fair from family court. They dispense justice, not fairness.

Quote:
Also note from my OP that the lawyer was saying SS was automatic due to length of the common law relationship and the income gap between them. Nothing about compensatory.
Well, SS is never automatic. In this case though it is likely. The judge will make it for one reason or another, but SS will be paid.

Quote:
He makes about $165,000/year.
That's actually not too much more. I was imagining something along the lines of $300k. Maybe SS won't be as likely. If I was a betting individual, I would still bet on SS being ordered, but it isn't 100%.


Quote:
If that was your point, then you should had stated that the family court makes decisions based on pure conjecture. You presented it as your position.
I'm an unpaid forum denizen. I do whatever amuses me.

Quote:
Based on what you said above, truth doesn't matter anyway.
And that, I'm afraid, is the truth.
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Old 09-29-2016, 11:48 AM
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Equalization rights do not exist in common law relationships. Full stop.

The only way to claim division of property is to demonstrate some type of legal interest (ie. being on title) or a constructive trust. I think it would be very difficult for her to show a constructive trust in his RRSPs.

It might be worth getting a second opinion from a different lawyer. 1 hour of legal advice isn't' that much and when he's making $165K it's probably a wise investment.
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Old 09-29-2016, 02:09 PM
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Quote:
Originally Posted by Kinso View Post
Equalization rights do not exist in common law relationships. Full stop.

The only way to claim division of property is to demonstrate some type of legal interest (ie. being on title) or a constructive trust. I think it would be very difficult for her to show a constructive trust in his RRSPs.
Unfortunately, I believe Janus has a point.

Agreed, equalization rights do not exist in common law relationships; however…

It’s not a stretch to say that her career suffered because of her child, which gave him the opportunity to advance his career. And advancement in his career equated to more income for his RRSPs. This means she could have contributed indirectly to his RRSPs, and voila - constructive trust!

The RRSPs may not be split down the middle, but the judge will likely do some black magic and come up with some arbitrary number.

He is not the biological father, but he did act in place of the biological father. This won’t be disputed, and it would be futile to go down that rabbit hole.
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