Can My Spouse Sell or Mortgage the Family Home Without Me in Ontario?

It is a common fear during a difficult stretch in a marriage: the house is only in your spouse's name, and you worry that it could be sold or borrowed against without you knowing. Ontario's Family Law Act speaks directly to this situation, and the protection does not depend on whose name is on title.

This article explains the basic rule, the few situations where a sale or mortgage can still go ahead, what a court can do if the rule is broken, and the practical steps people often take to protect themselves. Your facts matter, so a lawyer can confirm how this applies to you.

The basic rule: both spouses have rights in the family home

Under the Family Law Act, both spouses have an equal right to possession of a matrimonial home, whether or not their name is on title. A matrimonial home is property in which a spouse has an interest and that is or was ordinarily occupied by the spouses as their family residence. If you have separated, this is judged at the time of separation, and a couple can have more than one matrimonial home.

On top of that, a spouse may not sell or mortgage an interest in a matrimonial home unless one of four things is true:

• the other spouse joins in the transaction or consents
• the other spouse released their rights in a separation agreement
• a court order authorizes it
• a different property has been designated as the matrimonial home by both spouses and that designation is registered

If you own shares in a co-operative or corporation that give a right to occupy a housing unit, that counts as an interest in the unit for these purposes.

What shows up on a deed or mortgage

Ontario's land registration process builds this rule into the paperwork. A deed or mortgage registered under the Family Law Act must include one of the prescribed Family Law Act statements, for example that the property is not designated as a matrimonial home, or that the person consenting is the transferor's spouse.

This is why a lawyer handling a sale or mortgage will usually ask about marital status. What follows if a statement turns out to be wrong depends on the facts, so it is worth confirming with a lawyer.

If the rule is broken: when a court can undo a sale or mortgage

A court can set aside a sale or mortgage that was made in breach of the consent rule. It cannot do so if the buyer or lender acquired the interest for value, in good faith and without notice that the property was a matrimonial home. In practice, what the buyer or lender knew can become a central question.

You can also ask the court to decide whether a property is a matrimonial home. The court may set aside improper transactions, and it may authorize a sale or mortgage where the other spouse cannot be found, cannot consent or unreasonably refuses to consent. So the consent rule is not an absolute veto: a spouse who is being blocked unreasonably has a route to ask a court for permission.

Designations, marriage contracts and who is protected

One or both spouses may designate a property they own as a matrimonial home, and the designation may be registered in the proper land registry office. When a designation made by both spouses is registered, any other property that would be a matrimonial home but is not designated by both stops being one.

A designation made by only one spouse works differently. Registering it does not release other properties, which remain matrimonial homes if they meet the definition. Ontario's land registration bulletin says a single designation only gives notice of a potential spousal interest. That notice can still be useful, because notice is exactly what a buyer or lender needs to have for the good-faith protection not to apply.

A term in a marriage contract that tries to limit your matrimonial home rights is unenforceable. This means you cannot be held to a clause that signs away these protections in advance, although a separation agreement can release them.

There are limits to the protection. If only one spouse has an interest in the home, the other spouse's right of possession is personal as against the owner and ends when they stop being spouses, unless a separation agreement or court order says otherwise. A matrimonial home designation is also cancelled when a divorce or nullity judgment is made. And unmarried cohabitants are not "spouses" under this part of the Act, so the right of possession does not apply to common-law partners.

What to do next

If you are worried about the home, there are practical steps people often consider. Which ones fit depends on your situation and how urgent it is.

• Check title. A land registry search shows who owns the property, whether there are mortgages, and whether anything new has been registered.
• Consider registering a designation of the home. A designation by one spouse gives notice of a potential spousal interest.
• If you are applying about property or equalization, ask about a preservation order. The court may make interim or final orders restraining the depletion of a spouse's property.
• If the home may be at risk of an exclusive possession fight, remember a court can order exclusive possession of the matrimonial home to one spouse, considering factors such as the children's best interests and any violence.
• Keep copies of your marriage date, any agreements and records showing the home was your family residence.
• Speak with a family lawyer before signing any consent, separation agreement or mortgage document.

Frequently asked questions