How to Divide Property If You Are Common-Law in British Columbia

When a common-law couple separates, the first questions are usually practical: who keeps the home, what happens to the savings, and who pays the debts. British Columbia has a set framework for these questions.

The framework applies if you meet the test for spouses, and it starts from equal sharing with some important exceptions. This article explains the main steps in plain terms.

This article covers the law of British Columbia.

Do the property rules apply to you?

Property division rules apply to unmarried couples who have lived together in a marriage-like relationship for at least two years. A child together alone is not enough for property or pension division.

Couples can opt out of these rules by agreement. If you signed a cohabitation or separation agreement, it may change the result, so find it early.

What counts as family property and family debt

Family property is property owned by at least one spouse, or in which at least one spouse has a beneficial interest, on the date of separation. It includes shares, business interests, tax refunds, bank account money, annuities and pension entitlements.

On separation each spouse has a right to an undivided half interest in all family property as a tenant in common. Family property is valued at fair market value unless an agreement or order says otherwise.

Family debt covers financial obligations a spouse incurred during the relationship up to separation, and certain post-separation debts incurred to maintain family property. Spouses are generally equally responsible for it.

Excluded property

Excluded property includes property a spouse acquired before the relationship began, inheritances, gifts from third parties, most personal injury damages and settlements, certain insurance payments, and property derived from these. It is excluded from family property.

A spouse who claims that property is excluded must prove it. Keep records such as purchase documents, estate papers and account statements.

There is an important catch. Family property also includes the amount by which the value of excluded property has increased since the later of the date the relationship began and the date the excluded property was acquired. So the growth in value of a house one partner owned before the relationship is shared, but its starting value is not. The increase does not include value received from a discretionary trust.

When the split is not equal

• The Supreme Court may order an unequal division of family property or debt if equal division would be significantly unfair. Factors include the length of the relationship, agreement terms, career contributions, whether debt arose in the normal course, post-separation value changes, bad-faith dispositions and tax liability.
• The court may divide excluded property only if family property or debt outside BC cannot practically be divided, or if not dividing excluded property would be significantly unfair.
• A witnessed written agreement can be set aside only on listed grounds, such as failure to disclose significant property or debts or not understanding the agreement.

Steps toward a split, and what to do next

• Confirm your separation date, since family property is measured on that date.
• List all property and debts, and mark which items you say are excluded and can prove.
• Gather statements, titles, pension information and any agreement.
• Try to reach an agreement. Spouses may divide property and debt equally or unequally by agreement.
• Know the protective tools: a spouse can ask the Supreme Court to restrain the other from disposing of property at issue, and in some cases for an interim distribution of family property.
• If you need to stay in the home, the Supreme Court may order exclusive occupation for a specified period, but the order is temporary and gives no ownership interest.
• Watch the deadline: applications must generally be made within 2 years, which is suspended while you are in family dispute resolution.

A court can determine ownership or division and give effect to it through declarations of ownership and transfers of title. Because pensions, businesses and the family home can raise detailed questions, speak with a lawyer before you sign anything.

Frequently asked questions