What is the 'valuation date' and how does it affect the matrimonial home calculation in Ontario?

The valuation date is the date used to calculate each spouse's net family property for the equalization process. Under the Family Law Act, the valuation date is the earliest of: the date the parties separate with no reasonable prospect of resumption of cohabitation; the date a divorce is granted; the date a court declares the marriage a nullity; or the date one spouse commences an application under section 7 of the Act.

For most separating couples, the relevant valuation date is the date of separation. The matrimonial home is valued at its fair market value as of that date. If the parties take a long time to resolve their separation, the property's market value at the valuation date (which may be in the past) governs the equalization calculation, not its current value.

This can work in either party's favour depending on whether the market has risen or fallen since separation. Where the parties disagree about when they actually separated, the valuation date itself may be contested, and the court will have to determine when the separation occurred. Keeping records of the events surrounding the end of cohabitation — when one party moved out, when the parties stopped sharing finances, communications from that period — can help establish the valuation date.