When Is Family Property Valued in Alberta? The Trial-Date Rule

If you are separating in Alberta, one of the first questions is often: what is the house, the business or the pension worth, and as of when? The date matters because values move, sometimes a lot, between separation and a court hearing.

This article explains the main valuation rules in the Family Property Act. It applies to married spouses and adult interdependent partners, but spouses who were divorced or living separate and apart before January 1, 2020 generally stay under the old Matrimonial Property Act, and partners are covered only if they had not begun living separate and apart before that date. It is general information, not advice on your own file.

This article covers the law of Alberta.

The basic rule: value at the date of trial

The Family Property Act (RSA 2000, c F-4.7) is the former Matrimonial Property Act, renamed from January 1, 2020, and it now covers adult interdependent partners as well as married spouses. Under section 7(2.1), unless a written agreement that meets section 38 provides otherwise, property to be distributed is valued as of the date of the trial.

This means the number that matters is generally not the value on the day you separated. It is the value when the court deals with the case. If your matter ends by agreement instead of a trial, how values are fixed depends on your situation, so it is worth confirming with a lawyer.

The Court can divide property owned jointly or individually, so the rule applies whoever holds title.

Exempt property uses a different date

Some property is exempt from division. That includes gifts from third parties, inheritances, property acquired before the marriage or before the interdependent relationship began, and certain damages and insurance proceeds. For exempt property, the value that is protected is fixed at the later of the marriage date (or the date the relationship began, where applicable) and the date the property was acquired.

So there are two reference points: the trial date for property being divided, and an earlier date for what is exempt. The gap between them is where many disputes arise.

What happens to growth in exempt property

If exempt property rises in value, the growth is not exempt. Under section 7(3)(a), the difference between the exempt value and the trial-date market value, including property obtained by exchange or from sale proceeds, is distributed in a manner that is just and equitable after the Court considers the section 8 matters.

That is not the same as an automatic equal split. Equal sharing is the starting point for most property acquired during the relationship, but it gives way where an equal split would not be just and equitable. Other items are also dealt with on the just-and-equitable basis, such as property bought with income from exempt property and gifts between spouses or partners.

• Inherited or gifted property you want to protect
• Property you owned before the relationship began
• The value of each at the date it became exempt
• Any improvements or contributions made during the relationship

Property bought after separation, pensions and other special points

Buying something after separation does not automatically take it out of the picture. One of the section 8 matters is whether property was acquired while the parties lived separate and apart. The Court weighs it with other factors, including contributions, income, the length of the relationship and any agreement. Property acquired after a decree nisi or similar order, or after partners became former partners, is also dealt with on the just-and-equitable basis.

Pension benefits and locked-in retirement accounts are treated specially. Where pension or retirement legislation does not allow them to be transferred or paid out, the Court must still value them and distribute their value under the Act in the family property order.

Agreements and how values are actually worked out

A written agreement that meets section 38 may set a different valuation date. Section 38 requires each party to acknowledge in writing, apart from the other, that they understand the agreement's nature and effect and the claims they may be giving up, and to sign freely, before a lawyer who does not act for the other party.

The Act has no separate section on dividing debts, and it does not define property. Instead, liabilities and obligations are considered under section 8(d) when the Court decides whether an equal division is just and equitable. How an asset is valued in practice depends on the asset and the facts, and a lawyer or accountant can tell you what evidence is usually needed.

What to do next

• List all your property, wherever located, including anything you disposed of in the last year, because a sworn disclosure statement is required
• Gather your income, assets and liabilities as well, since the Court of King's Bench Financial Disclosure Statement includes a sworn itemized list of them
• Collect statements, appraisals and pension information that show current values
• Note the dates you acquired major assets and the dates the relationship started and ended
• Check for any written agreement and whether it meets section 38
• Mind time limits: spouses generally have 2 years from separation or from a decree, and partners have 2 years from the date they knew, or should have known, the relationship had ended
• Speak with a lawyer about which date and which exemptions apply to you

Frequently asked questions