Preserving Assets Before Trial: Freezing Orders in Ontario Family Law

Separation is stressful enough without worrying that money or property is disappearing. You may have noticed large withdrawals, a listing for the house, or transfers to relatives, and you want to know whether anything can be done before the case is decided.

This article explains the main tools in Ontario's Family Law Act that protect property while a claim is pending. Whether any of them fits your situation depends on the facts, and a lawyer can help you choose.

What a freezing or preservation order does

In an equalization application or an application about ownership or possession of property, the court may make an interim or final order to protect a spouse's claim. Examples include restraining dealings with property or requiring security. Separately, the court may make an interim or final order restraining the depletion of a spouse's property that would impair or defeat a claim.

In everyday language people call these freezing orders. They do not decide who is entitled to what. They hold the position steady so that a later equalization payment or ownership decision can actually be paid or carried out.

Other tools in the Family Law Act

• Early equalization: if spouses are still living together but there is a serious danger that one may improvidently deplete their net family property, the other spouse may apply to have the net family properties equalized as if they were separated.
• Security and payment terms: on an equalization application the court may order payment, security including a charge on property, instalments or delay of up to ten years if necessary to avoid hardship, and transfer, partition or sale of property.
• Title disputes: a person may apply to the court to determine a question with their spouse about ownership or possession of particular property.
• Exclusive possession of the matrimonial home: the court may order this whoever owns the home, with interim orders available on motion.

Unequal division of equalization is a different matter. The court may award more or less than half only if equalizing would be unconscionable, and one listed factor is intentional or reckless depletion of net family property.

Protecting the matrimonial home

No spouse may dispose of or encumber an interest in a matrimonial home unless the other spouse joins in or consents, has released their rights by separation agreement, a court authorizes it, or another property has been properly designated as the matrimonial home. A spouse may also designate property as a matrimonial home in the prescribed form, and the designation may be registered in the land registry office.

There is a limit. A transaction made without consent can be set aside, but not where the person holding the interest acquired it for value, in good faith and without notice that the property was a matrimonial home. If a spouse cannot be found, cannot consent or is unreasonably withholding consent, the court may authorize a transaction. These matrimonial home matters are heard in the Superior Court of Justice, not the Ontario Court of Justice.

Joint owners should also know that joint tenants and tenants in common of land in Ontario may be compelled to allow partition or sale, and any person interested may apply. How far that can be resisted depends on the facts, so ask a lawyer.

Which tool for which worry

What to do next

• Save statements and records showing the transactions that worry you
• Do not move or spend joint funds in ways that could be questioned
• Note dates, since the limitation period for equalization is the earliest of two years after a divorce, six years after separation, or six months after the first spouse's death
• Be ready to disclose your own finances, including a financial statement in Form 13.1 for a property claim
• See a family lawyer promptly if you think assets are at risk

Courts can extend a time limit in limited situations, but that is not guaranteed. Acting early is the safer approach.

Frequently asked questions