The Matrimonial Home
The special treatment of the matrimonial home under the Family Law Act is an unusual feature of Ontario’s family law system.
A matrimonial home is defined as a property which is ordinarily used by a person and his or her spouse as a family residence at the time of separation. More than one property may be a matrimonial home; for example, if a couple spends the summer at a cottage then both it and their usual home would be considered matrimonial homes.
The main effect of the special treatment of the matrimonial home occurs in the calculation of net family property [hyperlink to NFP article]. The value of a matrimonial home that was brought into the marriage by one of the spouses is not included in that spouse’s date of marriage assets. By contrast, its value is always included in the valuation date assets of the owning spouse (or divided between the assets of both spouses if both are on title). This has the effect of greatly increasing the net family property of the spouse who brought the home into the marriage.
If a matrimonial home brought into the marriage is sold and another is purchased prior to separation then the matrimonial home exception does not apply and the value of the original home is included in the owner’s date of marriage assets. This will normally remove the effect of the matrimonial home exception on the calculation of net family property, unless the new home was purchased with assets that would otherwise have been excluded property.
The net effect is that the person who brings the original home into the marriage saves a lot of money (half the equity) if that original home is sold and another purchased. It’s a nonsensical rule, but it’s the rule. So, if you are the party bringing the home into the marriage, sell it and buy another. If you are the other spouse, stay in the original home for the duration of the marriage. The difference could mean hundreds of thousands of dollars upon separation.
A matrimonial home cannot be sold or encumbered (e.g. mortgaged) by one spouse without the other spouse’s consent. This consent may be provided in advance in a domestic contract such as a prenuptial or separation agreement.
The right to possession of the matrimonial home is separate from the right of ownership. Even if one spouse has sole title to the home, the other spouse has a right to live in it which lasts at least as long as the marriage and may be extended by a separation agreement or by court order. Unlike other rights relating to the matrimonial home, this right of possession cannot be waived in a domestic contract.
Moreover, on the breakdown of the marriage, either spouse may apply for exclusive possession of the matrimonial home, even if they are not on title. This is an extreme remedy which is not commonly granted by courts, but it may occur in the context of domestic violence or one party being totally unable to afford other accommodation.