Here’s What You Are Entitled to in a Divorce in Alberta
Alberta’s divorce process involves numerous considerations, including the equitable division of assets and debts. Knowing how different assets are treated and what exemptions could apply to you can significantly impact your divorce settlement, say divorce lawyers in Calgary.
In this article, we will explore these aspects to help you understand your entitlements better.
Understanding Asset Division in Alberta Divorce
Alberta follows an equitable division mandate, which usually results in a 50/50 split of assets and debts during a divorce.
However, “equitable” does not necessarily mean equal. This approach aims to achieve a fair division based on each spouse’s contributions and circumstances.
The Family Property Act, which replaced the Matrimonial Property Act as of January 1, 2020, governs the division of property for married and adult interdependent partners in Alberta. This legislation ensures that the division of property accounts for fairness, even if it deviates from an exact split.
What is Considered a ‘Marital Asset’ in Alberta?
Knowing exactly what you’re dealing with is the first step towards an equitable division. Let’s redefine “marital assets” in Alberta and what they mean for your divorce.
Classification of Contributions and Assets
Assets and contributions during your marriage are typically classified into three distinct categories:
- Marital Property: This includes all assets and debts accrued from the date of your marriage up to the date you apply for their division. It encompasses a wide array of holdings such as real estate, vehicles, bank accounts, and pension benefits earned during the marriage. Joint investments and life insurance policies also fall into this category.
- Exempt Property: Certain assets remain outside the scope of division. These are generally assets that were owned before marriage or were received as personal gifts or inheritances meant only for one spouse. (Learn more below)
- Increase in Value of Exempt Property: If exempt properties increase in value during the marriage, that increase is often considered marital property and may be divisible upon separation.
It is highly advisable that you consult with property division lawyers to protect your rights. Full disclosure of property is required in Alberta, but can often be an issue. If that’s the case, your lawyer can file a Notice to Disclose/Notice of Motion to compel the other party to comply with their legal obligations.
Scope of Marital Assets
Marital assets extend beyond physical and financial properties to include:
- Real properties and all associated legal titles, whether they are lands or vehicles.
- Any savings and bank accounts opened or contributed to during the marriage period.
- Gifts or inheritances received during the marriage, provided they were intended for both spouses to benefit equally.
- Personal properties and rights that were acquired between your wedding day and the day you file for asset division.
Debts, too, are typically regarded as part of the marital estate, needing fair distribution just like assets. There are
Asset Exemptions in Divorce in Alberta
While many assets are divided during a divorce, certain assets can be exempt from division. These include:
- Assets owned before marriage
- Inheritances, unless mingled with marital assets
- Gifts received solely by one spouse
- Personal injury settlements
- Proceeds from insurance policies
However, these exemptions can be voided if they are mingled with marital assets. For example, depositing an inheritance into a joint account could make it subject to division. Additionally, the increase in value of exempt assets during the marriage can be shared between spouses.
Pensions and Retirement Accounts in Divorce
Pensions and retirement accounts accrued during the marriage are considered marital property and thus subject to division. While the pre-marriage value of pension benefits can be exempt, any benefits earned during the marriage are shared.
To accurately determine the value of these pensions and retirement accounts, actuarial valuations are required. These valuations are crucial during negotiations to ensure a fair distribution of retirement benefits between both parties.
Non-Financial Contributions
In asset division, Alberta law recognizes both financial and non-financial contributions, such as homemaking and child-rearing. Although non-financial contributions do not carry intrinsic financial value, they significantly impact the marital wealth and the support given to a spouse and family.
Considering these contributions ensures a fair and balanced division of property. The contributions of a stay-at-home parent, for example, are valued for the non-monetary support they provided to the household and family.
Major Assets Like the Family Home
The family home is often the most significant asset in a divorce and is subject to equitable division like other marital properties. One partner, typically the one with custody of children, may keep the home. Alternatively, it may need to be sold, with proceeds divided if it represents the major asset.
Negotiating a Fair Property Division in Divorce
Negotiating property division privately can mitigate the risk and cost of litigation. Mediation is often recommended to avoid prolonged court battles, providing a collaborative environment for both parties to reach an agreement.
Legal advice is pivotal in this process to understand your rights and to avoid unfavorable positions during disputes. A divorce lawyer can facilitate negotiations, guiding you through the legal complexities to achieve a fair settlement.
Exploring Prolonged Separation as an Option
Prolonged separation can be an option for couples wanting to avoid the full division of assets. However, they remain legally married and cannot remarry. Alberta law mandates a 12-month separation period before qualifying for divorce.
This period can serve as a cooling-off time, allowing couples to reconsider their decisions and explore possible reconciliations while still addressing their marital issues.
Ensuring Fair Outcomes with Professional Legal Support
Property division isn’t just a mathematical calculation, it factors in prior commitments, emotional obligations, and so many little things. It’s why any talk of property division between divorcing spouses or separating common-law partners can become so contentious so quickly.
It’s vitally important that you reach out to experienced divorce lawyers in Calgary to ensure fair distribution of property and prevent a situation where one party walks away with more than they are entitled too.
Reach out to us today to consult with an experienced divorce lawyer in Alberta and secure the legal support you need during your divorce.
