Even if parties are not formally married, there may be property division rights that apply to property that is jointly held by the parties or held by one of the parties. The law has evolved to change how property rights can apply to common-law partners. Which property rights apply will depend on when the parties are separated, and even cases being brought to trial today may involve the former act, the Adult Interdependent Relationships Act for property division rules, rather than the Family Property Act, which covers property division for both married and common-law couples.

This post will discuss the different property division regimes that can apply to common-law partners, including when each will apply. We will highlight the different regimes and the legal consequences that can flow from each. We will also discuss what can happen if the parties informally agree on certain property division terms, including giving up rights as a common-law couple after separation. This post will provide important takeaways for common-law partners seeking to understand their property division rights after separation.

Property Rights for Common-Law Partners

In Alberta, common-law couples are called adult interdependent partners. Not all relationships are considered adult-interdependent partnerships, as they must meet certain criteria set out in the Adult Interdependent Relationships Act (AIRA). Generally, an adult interdependent relationship arises when the parties have lived together in a relationship of interdependence for a continuous period of at least 3 years. Otherwise, an adult interdependent relationship may also arise if the relationship is of some permanence, such as if the parties have a child together.

Two regimes can apply for dividing property owned by one or more of the parties. Under the old regime, common-law partners would be subject to common-law principles for property division, such as unjust enrichment or other equitable remedies through the court. This means the court will consider case law with facts similar to the case at hand. Under the new regime, the Family Property Act would apply to common-law couples. Previously, the Matrimonial Property Act defined how property would be divided between married couples after separation, but not for common-law couples.

The court will consider when the parties separated to determine which regime applies. For the Family Property Act to apply retroactively to couples before it came into force, the parties must be considered former adult interdependent partners by January 1, 2020. This means that the parties must have separated before January 1, 2019, as they must have been separated for a year before being considered former adult interdependent partners. Therefore, it is very important to have a clear idea of the separation date, as property rights may differ depending on which regime applies.

Under the Family Property Act, any property owned by the parties, whether jointly or solely owned by one of the parties, may be subject to equal division. There are also property categories exempt from division, such as property acquired through an inheritance.

Informal Agreements to Give Up Property Rights May Be Invalidated

If common-law partners do not want to have their property divided as under the Family Property Act, they can enter into an agreement to specify how their property is to be divided after separation. If the common law and case law apply to property division for the couple, then the court can also consider any agreements made between the parties.

In many cases, common-law partners may have yet to consider getting a formal agreement for property division. They may have yet to engage a lawyer, so they may not have executed a property division agreement they discussed with a lawyer or signed before a lawyer or notary. However, it is important to consider whether a court will uphold these agreements if there is a dispute. Generally, these informal agreements may not be upheld or given much weight if they are an agreement to completely give up property rights without consulting a lawyer. For instance, in the case Mills v Pridge, 2024 ABKB 250, the court found that an agreement by one of the common-law partners to give up rights to the family home was invalid, as he had not consulted a lawyer about the legal rights he was giving up before signing.

Court Finds Common-Law Partner Did Not Agree to Give Up Property Rights

In Mills case, the parties were in an adult interdependent relationship for many years from 1994 to 2019. The parties separated in May 2019. The parties did not have any children together. During the relationship in 2011, the parties had purchased a home together. They lived together in the residence until separation, when one of the partners, Donna, remained in the home. She also continued making payments for the home, such as mortgage and insurance payments.

At the time of separation, the parties were in their mid-50s. One of the partners, Donald, had worked for 18 years with the same organization before being terminated for cause in 2022. Donna also had not been working since 2016. Before then, she worked as a personal care assistant until a workplace injury in 2013.

There was a dispute over how to divide the home in this case. Since the parties separated in May 2019, common-law principles would apply to the home division rather than the Family Property Act. There was a handwritten agreement signed by the parties, which stated that Donald was giving up his claim to the home that the parties jointly owned. The court found that Donald had signed the document, but it was still invalid because it was unclear at the time if he understood that he was giving up his legal rights to the house. He also remained on title of the house both at the time of signing the agreement and after separation. This agreement was found not to be enough to remove him from the title of the house. His interest in the home remained, and the court decided it would be divided equally between the parties.

Key Takeaways

Common-law partners should speak with a lawyer to understand how their property rights may apply, as it could fall under the former rather than the current regime. If the parties are seeking to make an agreement concerning property division, they should be aware that informal agreements may not be upheld in court.

Mincher Koeman Lawyers Can Assist with Property Division for Common-Law Couples

Common-law principles can still apply to property division for common-law partners, rather than the Family Property Act, depending on when the parties separated. As this is highly specific to the circumstances of the case, you should speak with one of our family law lawyers at Mincher Koeman, who are experienced in assisting parties with issues involving property division. Our Calgary family law lawyers are dedicated to finding your best resolution after separation.

To book a consultation, please contact us online or by phone at 403-910-3000.

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