Assets bequested or bought *before* a marriage

[Concerned]

Hello,

I have a simple question. If I own a home which I totally paid for and I get married and use this home as community property, what happens in the event of a divorce. Let me explain this in greater detail:

Let's suppose that I purchased a new home and completely paid it off by myself for a price of 400K and a few years later I then meet a women and get married and use the home so she and I can live in. 5 years later, the home is now worth 600K.

So in summary, assuming we had no kids, and the home increased by 200K in value during those 5 years that we were married, in the event of a divorce, according to Quebec law, does she get half the home or 50% of its increased value (hence 100K)?

Please note, to keep things simple, let's assume she did not contribute for any home maintenance, home add-ons, decorations, property insurance payments or any bills towards the taxes or any other typical expenses a home may require. Let's also assume she did not pay rent. All she paid is 50% of the electrical utility bills and 50% of the phone bills and 50% of the grocery bills.

In this case, what does she get?

regards
r

[blinkandimgone]

Not sure about Quebec law but in Ontario the equity in the matrimonial home gets split 50-50, regardless of who owned it, bought it, paid what towards it and when. It's 50-50.

[Moolight]

In Quebec, it is rally different. You are saying that you chose the community of property regime, are sure that you have this contract?

this makes a big difference.

At divorce each party conserves his or her private property and has the right to one-half of the common community property.


see
Quebec Divorce Lawyer - Common Issues

[Concerned]

Thanks blinkandimgone for your reply.

But I really need to know in reference to QUEBEC. I have been reading the quebec act a little here, but it seems to leave out this particular scenario??

regards
r

[Concerned]

Hello moonlight. Thankyou for replying.

>In Quebec, it is rally different. You are saying that you chose the community of >property regime, are sure that you have this contract?

This regime has not been legal since 1970. So we are not talking about this regime. We are talking about the "Separation as to property" regime which is (and correct me if I am wrong) the one that is usually used in every typical marriage contract.

So under this regime ("Separation as to property") , what does she get?

regards
r

[Moolight]

It looks like in Quebec, if you did not have any contract.

You can deduct the value of the house you owned prior the mariage. This would mean that only the increase value in your case wil be subject to division.
Family Patrimony - Éducaloi

[Concerned]

>>You can deduct the value of the house you owned prior the mariage. This >>would mean that only the increase value in your case wil be subject to >>division.

Yes! I see, but can someone confirm this by reading the Qebec act below. I notice that the Quebec act stipulates this **BUT** are there any legal traps that you and I can't see.

I am currently reading the act and it goes like this:

==================================
Separation as to property

The regime of separation as to property requires a notarial marriage contract.
Under this regime, each spouse remains the exclusive owner of his or her property, administers the property alone and assumes responsibility for his or her debts, subject, however, to the legal provisions respecting the family patrimony, the protection of the family residence and furnishings, and the spouses’ joint responsibility with regard to debts contracted for the family’s day-to-day needs. For example, even if one of the spouses is the sole owner of the family residence, he or she cannot dispose of it without the other spouse’s authorization.

If the regime is dissolved, the spouses retain their own property, providing they can prove ownership. Gifts made in the marriage contract can increase a spouse’s share; however, gifts made by the spouses to each other in the event of death (also called gifts mortis causa) are automatically cancelled by divorce or annulment, whereas gifts given during their lifetime (gifts inter vivos) can be cancelled or reduced by the court.

Couples who choose the regime of separation as to property should purchase all durable goods, particularly immovables (buildings and land), in undivided co-ownership. This is done by having the names of both spouses written into each notarial act of ownership or purchase whenever the value of a transaction warrants it.
=================================

In the above act, there are a few things that bother me and are not clear:

QUOTE-1:
"Gifts made in the marriage contract can increase a spouse’s share;"
So, someone gives me a gift, or I win the lottery, I then have to share it with my wife??

QUOTE-2:
"For example, even if one of the spouses is the sole owner of the family residence, he or she cannot dispose of it without the other spouse’s authorization."

So, if I marry a women under this regime and I paid my house myself before we got married.... then when I marry a women, I can't solely exercise my decision to sell it??

QUOTE-3:
"If the regime is dissolved, the spouses retain their own property, providing they can prove ownership."

So I guess the deed of the home with my sole name on it would be enough right? If so, are their any legal entrapments that can alter this?

QUOTE-4:
"Couples who choose the regime of separation as to property should purchase all durable goods, particularly immovables (buildings and land), in undivided co-ownership."

huh? Why would I do that especially if its my money that I earned way before the marriage that will buy these immovables???

really discouraged with this law...

r

[Moolight]

Concerned, if you did not have any contract, you are probably under the first regime - Partnership of Acquests.

There are essentially two types of matrimonial regimes to choose from:

1. Partnership of Acquests
2. Separation as to Property

In Quebec you can by contract of marriage, entered into before or during the marriage, choose between partnership of acquests or separation as to property or modify your matrimonial regime during the marriage from one regime to the other.
If you have not entered into a marriage contract, the law decides your regime for you.
Partnership of acquests
Those who married after July 1, 1970 without a marriage contract are subject to the legal regime of partnership of acquests

[Concerned]

Yes Moonlight, I know this.

But my main concern (according to the act above) is that when divorce comes, a simple showing of my deed of my home with my sole signature on it will totally relinquish any rights my wife would have towards the home... yes?

r

[Moolight]

If you read this portion, it stipulate that you retain ownership of what you own prior the regime. Gifts and Inheritance are considered private.

448. The property that the spouses possess individually when the regime comes into effect or that they subsequently acquire constitutes acquests or private property according to the rules that follow.


1991, c. 64, a. 448.


449. The acquests of each spouse include all property not declared to be private property by law, and, in particular,


(1) the proceeds of that spouse's work during the regime;


(2) the fruits and income due or collected from all that spouse's private property or acquests during the regime.


1991, c. 64, a. 449.


450. The private property of each spouse consists of


(1) property owned or possessed by that spouse when the regime comes into effect;


(2) property which devolves to that spouse during the regime by succession or gift, and the fruits and income derived from it if the testator or donor has so provided;


(3) property acquired by that spouse to replace private property and any insurance indemnity relating thereto;


(4) the rights or benefits devolved to that spouse as a subrogated holder or as a specified beneficiary under a contract or plan of retirement, other annuity or insurance of persons;


(5) that spouse's clothing and personal papers, wedding ring, decorations and diplomas;


(6) the instruments required for that spouse's occupation, saving compensation where applicable.


1991, c. 64, a. 450.


451. Property acquired with private property and acquests is also private property, subject to compensation, if the value of the private property used is greater than 1/2 of the total cost of acquisition of the property. Otherwise, it is an acquest subject to compensation.


The same rule applies to life insurance, retirement pensions and other annuities. The total cost is the aggregate of the premiums or sums paid, except in term insurance where it is the amount of the latest premium.


1991, c. 64, a. 451.


452. Where, during the regime, a spouse who is already privately an undivided co-owner of a property acquires another part of it, this acquired part is also that spouse's private property, saving compensation where applicable.


However, if the value of the acquests used to acquire that part is equal to or greater than 1/2 of the total value of the property of which the spouse has become the owner, this property becomes an acquest, subject to compensation.


1991, c. 64, a. 452.

[Moolight]

Yes Moonlight, I know this.

But my main concern (according to the act above) is that when divorce comes, a simple showing of my deed of my home with my sole signature on it will totally relinquish any rights my wife would have towards the home... yes?

r

Concerned, she can not take ownership away from you, she can only claim her share of the increase value.

[ddol1]

Here is a very none technical way of looking at it. Admirable to try and learn as much as you can so you can ask the best questions and understand any options given to you; the notory in Quebec is charged with making marriage contracts, wills etc. They are far cheaper than a lawyer and if you have your ducks in a row (list exactly the state of your property) the notory would be able to confirm 100% what is for you a very critical issue worth 100's of thousands of dollars in the house alone.

You know that Quebec always has such a different way of doing things I would guess that it would be a rare case in which Quebec would even be similar to Ontario. Here is something to consider, Ontario has divorce legislation in plain Language that a regular person can read and understand. (I beleive I read that this was not always so - Ontario made the effort to simplify the language at some point) Quebec has made no such effort - one word can change the meaning of everything and the language is not straight forward. As before, you have so much at stake - almost mandates your use of at least someone who can best protect your interests. I am sorry but it sounded like you have not actually begun the divorce process? If not perhaps there is a chance you can do something to protect your interests?

[arabian]

50% of the increase of value while both lived in the house (50% of 200,000 = $100.00) as far as I know.

[Concerned]

Okay, okay I got it ....

Now .... evaluate the same *exact* scenario as I detailed in my innitial post... but this time the only difference is, suppose we had a child during our 5 year marriage. In this case, always in reference to Quebec law, does she still only get 50% of the increase of value while both lived in the house ?

a) Yes
b) No, she gets more than the 50%
c) No, she gets the whole house
d) No, and it depends... its a bit more complicated than that... (please elaborate in simple terms).

Thanks for everyone that replied.

r