PreMarital Asset? Help

[chrisnepean1974]

I hope someone here can answer my question. When I met my ex she had a house already for 4 years (her name only), I moved into that house with her and then we got married and had kids, (no prenups of any kind), that house became the Matrimonial home. I lived there and spent about 20K (my money) fixing it, paid off her debt and payed the mortgage on it for 6 years (everything co-mingled, including joint bank accounts etc.). We then sold that house and converted what might have been considered separate property into community or matrimonial property by using all of the money from that house to purchase a new matrimonial home. Every dime of our money is in the current matrimonial home.
She is trying to claim that the equity that she had in the previous home prior to our marriage is a pre-marital asset. exempt from NFP and equalization.
I do not see how that is possible as in both cases the homes were matrimonial homes which should be subject to a 50/50 split.
I read the following ONLINE and want a final answer from someone who knows.
QUOTE: "Marital property that is acquired by converting non-marital property now has a community interest and is subject to the normal property distribution process. A marital home for example, that is purchased with proceeds from selling non-marital stock becomes part of the marital assets."

Please help by providing a clear answer.
Best Regards

[OrleansLawyer]

A fruitful discussion of this topic may be found here:
http://www.ottawadivorce.com/forum/f...arriage-13404/

Equalization of property takes your net property on the separation date and, subtracting net property on the marriage date, provides a value of your net family property.

The Matrimonial Home is not deducted from marriage date assets. Keep in mind, however, that the matrimonial home is the property that exists at separation.

[chrisnepean1974]

Thank you for your reply,

So a simpler question, I read the attached forum discussion and I assume from reading it that the concensus is that because the previous home was sold and the money was used to purchase the matrimonial home that the previous assets were absorbed into the martimonial home and cannot be claimed or exempted from the net family property. We split the value of the NEW matrimonial home 50/50.

Simple question:
In your opinion does my STBX have a ligitimate case to claim any value of the previous home as exepted property? Yes/No/Why. I am not a lawyer, talk to me like I am 4. lol.

exerpt from the office of the ministry of the attorney general
"There are some possible exceptions to these rules, which are called excluded property, and may include gifts or inheritances received during the marriage from someone other than a spouse, provided that the gifts/ inheritances/excluded property were not used towards a matrimonial home" (WHICH HAPPENED -- The money from the sale of the first house was INVESTED in the matrimonal home"
AND
To exclude these from your net family property, you must have kept these items separate from your other property, and be able to trace these funds from the day you received them. The only exception to this is again, the matrimonial home. You must include the value of a matrimonial home in your net family property even if you used proceeds from one of the above listed items to help pay for your home.

Confusing subject
Chris

[randomjohndoe]

In your opinion does my STBX have a ligitimate case to claim any value of the previous home as exepted property? Yes/No/Why. I am not a lawyer, talk to me like I am 4. lol.

It's good that you are not a lawyer. Then you might be able to step back and think, HONESTLY, what do YOU think would be fair?

You don't get 50% of the house. You get 50% of her INCREASE of NFP.

[MiViLaLoco]

It is my understanding that your ex has no claim to keep the funds exempt...they were used to purchase another marital home...period. If she wanted to keep her original equity seperate...and hers alone...she should have removed the funds from the sale of the first home and not used them to purchase the second.

In a nutshell...she should not have intermingled the "asset" back into the maritial home if she intented it to be kept seperate. This is really a black/white situation and probably the only one that is really cut and dried in family law...lol

[Rioe]

By law, the current matrimonial home is divided 50-50, no matter who owned what before marriage, or where the money came from to buy the home. It's the law, sure, and made good sense at one point, but it's not very fair for many modern situations where one person invested a lot more into the home than the other person.

You could fight her and win 50-50. However, you might save yourself a lot of hassle and legal fees and court time if you concede that a disproportionate amount of the asset of the house came from her pre-marriage property, and make an offer that helps her recoup some or all of that.

Just because it is the legal thing to do, does not make it the right thing. Do you have children together? Splitting up amicably with some concessions to fairness right now may set a far better foundation for future co-parenting than turning your separation completely acrimonious by fighting over this.

[FightingForFamily]

My ex did something similar (used money gifted from her wealthy family and put it into the matrimonial home). According to law, the money is comingled and not an exemption. But people get REALLY angry over it. In the end I returned her half of that money to settle matters out of court. 10-15k of money given back to her is better than spending 10-15k on a trial to win 10-15k and end up with nothing in either person's pocket.

[OrleansLawyer]

I assume from reading it that the concensus is that because the previous home was sold and the money was used to purchase the matrimonial home that the previous assets were absorbed into the martimonial home and cannot be claimed or exempted from the net family property.

This is not correct. The previous property is a marriage day asset, which will be deducted from net family property as any other marriage day asset.

In your opinion does my STBX have a ligitimate case to claim any value of the previous home as exepted property? Yes/No/Why.

Is the previous home excluded property? No.
Why? Because it was a marriage day asset; money you bring into the marriage is not excluded property - it is a deduction from your net family property.

By law, the current matrimonial home is divided 50-50

This is an over simplification.

Just because it is the legal thing to do, does not make it the right thing.

Prudent advice.

[momforever1956]

The money that I brought into the marriage that was used to purchase our 1st home was protected and was deducted from the NFP statement.
After buying our first home we did sell and buy 2 more homes. I still was given credit for the money I brought into the marriage and I contributed to the first home we bought after we were married.

[thorns]

A pre nup should of been done, because one wasn't drawn up you are legally entitiled to half of the equity in her first home. I dont agree with someone doing this, but being no contract was drawn up, she did allow you to pay on that mortgage, and put money into the home. So it is to be split 50-50.

[OrleansLawyer]

you are legally entitiled to half of the equity in her first home.

This is not correct, as discussed above.

she did allow you to pay on that mortgage, and put money into the home. So it is to be split 50-50.

Neither did she charge him rent.

In any event, he would have benefited from the increase in the value of the property during the marriage, since the increase would have resulted in more equity coming from the home and going into equalization.