Couples which are in common-law relationships are not married but still live together. They are not entitled like a married couple are when it comes to ancestors properties equalization. Various laws in Family Law Act governs property succession but only for married couples not for common-law couples. In a Common-Law relationship, each couple will get possession of what he or she has accomplished on their own or throughout the relationship.
When two individuals live together or have lived together for a long time, determining who owns what or who bought and brought what to the house might be difficult; therefore, the common rule is:
- Anything bought during the partnership will be the property of the person who brought it and paid for it.
- Items purchased in a group will be divided.
The House Division
The house will be given equal weightage as any other asset is; as previously said, the person who creates or buys the asset is the person to whom it will belong. If both partners bought this together, it will belong to both of them.
For debt, the same general guideline will be applied. Each spouse will be accountable for their obligations, and the bank can pursue either or both of them if there is a joint liability.
If the couple splits up before the wedding day, who will get the wedding ring? In this case, the law is unclear.
If a couple breaks up before their wedding day, many engaged couples ask what happens to the engagement ring. Who will be the one with the possession of the ring? In reality, the law is still ambiguous.
According to Ontario’s Marriage Act, section 33, the giver’s role in causing the relationship split will not be taken into account when determining whether the giver is entitled to the return of any gifts given in anticipation of marriage (such as the ring). However, the Act has been applied inconsistently by the courts. Various courts have ruled that the person whose actions end the partnership may lose the right to the ring. In other cases, courts have ruled that the ring is an unconditional gift that, like any other item given throughout the relationship, stays the recipient’s property.
UNJUST ENRICHMENT / CONSTRUCTIVE TRUST
If one believes that he or she has made a significant contribution to the value of a specific and large asset owned by the other partner, such as the house in which they have lived, or bank accounts, pensions, or savings accounts, and that it is thus unfair for one to keep the entire value of that asset, one is not completely without options.
While a common-law partner does not have an automatic right to distribute property equally or how to divide the family house, a constructive trust claim can be filed to seek restitution for unfair enrichment. To prove unjust enrichment, one must demonstrate that:
- You and your partner collaborated on a family project; and
- Your business keeps a sizeable piece of the profit.
A constructive trust’s beneficiary has rights to the property in some particular assets, such as the marital home. Even though there is no link between one partner’s contributions and a specific asset or piece of property, a court might impose monetary damages for unfair eviction if one spouse can establish that the other is unfairly holding a disproportionate amount of the earnings of a joint family firm.
Finding a good lawyer and going to court, again and again, could be tiring and time consuming. It’s hard to guess what the judge will find about a joint family venture and unjust enrichment, or what kind of ruling or remedy they will provide. Evidence must be presented to back up the allegations. If you decide to go down this road, you’ll need to find an Expert family law lawyer who is experienced and informed in this field.
Firstly the court evaluates a range of fact-specific considerations and then decide if you and your partner should be a part of a “joint family endeavour,” such as:
- Was there any resource sharing (like, whether both parties have participated in establishing a business or buying a home)?
- Was there any interaction between the children of the two parties?
- Were there any shared decisions taken about joint responsibilities such as children and other finances?
- What did the account integration between the two parties entail? Were there any shared liabilities like credit cards?
- Are they living in a manner married couple lives?
- Have they declared themselves as common-law partners officially on tax forms, for example?
- Had the coupe place a larger value on the family as a whole than on themselves? Did they make decisions for the sake of the family, such as moving or changing careers?
The longer a couple has been married, they will have children and other responsibilities together, and the more closely they have to manage their finances which will be linked, hence there are more chances that the court may mandate the formation of a joint family venture.
If a joint family business has been set up, it must be proved that the partner has received an unfair benefit out of it and is achieveing an unfair proportion of the share of profits. Moreover, it should be made absolutely clear that you have enriched your spouse materially or laboriously; that giving such gifts resulted in a commensurate deprivation; and that the enrichment was unjustifiable (maybe a git, inheritance or a contract).
FINANCIAL AND LABOUR CONTRIBUTIONS TO CONSTRUCTIVE TRUSTS
As previously stated, the worth of a single property item may be proportionate to your labour. Assume you invest a large amount of time improving and restoring your partner’s home’s worth. As a remedy for unjust enrichment, the courts understand these kinds of situations and could award ownership of that proportion of property where you have contributed.
In other circumstances, the situation may be more broadly tied to the family aspect than to a particualr part of the property. For a situation, one takes care of house chores or children responsibilities to free up your partner’s time and responsibilities to work or establish a business, but the profits earned aren’t shared. In such cases, the courts award a share of the increasing value of the business proportionally throughout the relationship.
BRINGING A CONSTRUCTIVE TRUST CLAIM
A trust claim should be filed because it is such an important feature, or legal assistance should be sought as soon as possible following the separation. If the claim is not filed within two years of the separation, the other party may be able to successfully convey that the restriction period has passed and the other party is no longer prohibited from filing the claim.
Author’s Name: Purvi Srivastava (Bennett University, Greater Noida)