FamilyCounsel.ca

What changes should be made to family law?

These proposals let family law lawyers discuss and vote on what changes they think should be made to the law or court procedures. The results can be viewed and shared with legislators and the Courts. The proposals put forth are written by member lawyers, and do not necessarily reflect the views of this website or its administrators. You can view more proposals or make a proposal yourself.


Proposal: Property should be presumptively valued at the date of separation
Property - Aug 13, 2021

86% in favour out of 21 votes

Ken Proudman Executive
 view Arbitrator profile
  BARR LLP
   Edmonton, Alberta


This was the Alberta Law Reform Institute's (ALRI) recommendation in their Final Report 107. See https://www.alri.ualberta.ca/portfolio-items/matrimonial-property-act-valuation-date/

This change would remove issues created by overlapping relationships, especially now that a spouse who's no longer cohabiting with their spouse may also have a claim against them by a new partner from the commencement of their relationship.

This would also reduce legal fees and lead to quicker resolutions, because we wouldn't have to constantly recalculate and repeatedly exchange disclosure, and wouldn't have to argue about issues like property acquired after the separation or whether a spouse should be entitled to a credit for debts paid down after the separation.


1 2 years ago

Ken Proudman Executive
 view Arbitrator profile
  BARR LLP
   Edmonton, Alberta


Personally, I'm still on the fence about this proposal, but posted it because it's still fairly topical. In most separations, where the main asset is the house, the value of the house would likely only change because of fluctuations in the market. If the house value only increased because the spouse living in the house didn't pay out the other and not because of their efforts, then why shouldn't they have to share that increase? You could address that through interest, but what if it was the other spouse holding up resolution? The spouse retaining the house usually can't refinance without a separation agreement. Or similarly, if it's market forces that led to a decrease in value, why should the spouse who's willing to refinance and take the debt be the one to have to pay out more than half the equity? This change might even lead to more people selling their homes and losing equity through sale costs.

You could say that either way, these scenarios could be addressed through section 8 factors, but that's what Hodgson v. Hodgson, 2005 ABCA 13 said to do, and section 8 factors are often ignored. I'd prefer a more nuanced and explicit rule that treats property differently when that asset increases or decreases in value because of inflation.


0 2 years ago

Ken Proudman Executive
 view Arbitrator profile
  BARR LLP
   Edmonton, Alberta


In early 2019 the then Minister of Justice responded to a letter from Sarah Dargatz and explained why she decided not to implement ALRI's recommendation. You can see that letter here: https://familycounsel.ca/news.php?id=543&topic=9&page=0&search=minister

1 2 years ago

Evan Clarke
  Kahane Law Office
   Edmonton, Alberta


I like this because most of the time it seems to me that this date is the appropriate date. Shortly thereafter the parties normally start separating their respective finances.

The proposal is that the date of separation be "presumptively" the date of valuation, meaning of course, where it is not appropriate for whatever reason, that presumption could be rebutted.

It makes good sense to me to make the presumption consistent with what is usually the reality. Especially considering most disputes to do not go to a trial, which makes the current statutory presumption useless.


0 2 years ago

Wayne Barkauskas, K.C. Executive
 view Arbitrator profile
  Wise Scheible Barkauskas
   Calgary, Alberta


I am strongly in favour of the "date of trial" principle that Alberta uses. There are benefits and drawbacks to each method, as other Provinces have discovered.
The key for me is that a "date of separation" principle puts very significant power in the hands of the person controlling all of the assets. It actually benefits them to utilize those assets to their sole benefit for as long as possible as they get to keep the benefits derived. It is like an interest free loan at the worst and in many cases worth far more value than that. Think of a business that can continue to operate and generate value from all it's assets without selling any of them or incurring debt, and there will be no sharing of those advantages at trial, even when trial is years into the future! The current valuation principles are actually an INCENTIVE to the property holder to resolve things and share with the other side as quickly as possible so that the rewards of future efforts do not have to be shared.


1 2 years ago

You must log in or sign up to reply to conversations.











© 2016 to 2024 Kenneth J. Proudman. DISCLAIMER: The tools, documents, and other information herein are not legal, tax, or accounting advice or opinions. This website contains content and files submitted by third parties, to which you download or view at your own risk. By using this website, you agree to release Kenneth J. Proudman, BARR LLP, and Miller Boileau Family Law Group from all present and future claims and liability, including liability arising from any negligence.