In order to make an order for matrimonial property division, the court requires evidence of all the property that may be available for division. This may include properties that exist overseas. As a result, it can be more difficult to obtain the required evidence regarding these overseas properties or interests, as these are managed by another country outside the Canadian court system and procedures. It is also possible for a spouse to provide inadequate disclosure concerning overseas properties and interests. This can add to the difficulty in dividing matrimonial property and determining a payor’s income for support purposes. Some of the property may also be intermingled with other relatives, further complicating the matter. 

In this post, we will discuss what types of evidence may be helpful when dealing with overseas property or interests. Also, we will examine a recent Alberta case, MF v MSY, 2020 ABQB 383, which involved matrimonial property that existed overseas. There were disputes concerning the true owner of these properties as they became intermingled with relatives in the spouses’ home country. This case provides helpful insights for situations where overseas property ownership is disputed. 

Evidence for Establishing Overseas Matrimonial Property 

In some cases, it is very difficult to establish any overseas matrimonial property, as this may be owned by one spouse, who may be unwilling to disclose their interests despite a requirement to do so properly. Nevertheless, the following types of evidence can help establish what overseas matrimonial property may exist and the ownership of this property:

  1. Any documents that evidence any changes to the ownership, which would reveal also the timing of when the property was transferred (such as title deeds); 
  2. Documents showing that a spouse can deal with property independently or not; 
  3. Any receipts that show what was received for the transfers of property to determine if they were valid or meant to defeat a family claim to property or interest; 
  4. Documents evidencing a change in shareholder interests for corporations; 
  5. Anything showing that the spouse has control over the corporation, despite not being the majority shareholder; 
  6. Valuations at the time of marriage and at the time of trial, which may require an overseas expert who is more familiar with the jurisdiction at issue; 
  7. Evidence of the relevant currency exchange rates. 

Both parties owned property overseas in Iran 

The parties were married in Tehran, Iran, in 1995 and later moved to Calgary with their 3 children. The parties separated in 2016. 

Both parties owned overseas property in Iran, which was intermingled with relatives at some points. 

Wife’s inherited property is exempt but no longer available for distribution 

Before the marriage, the wife and her family inherited the father’s home after he died from a terrorist attack. As he was a surgeon and Minister of Health, the wife’s family was entitled to compensation. A program allowed the family to trade the father’s home in exchange for apartment units for each family member. The wife’s family proceeded, and she received one of the apartment units located in Iran. 

For this property, there was a dispute concerning its construction and ownership. The wife claimed she wanted it to remain her inherited property, so she did not put it in her husband’s name. He claimed that he and his parents had paid for the construction of the unit. The court found that this property was exempt as inherited property. The court determined that the wife’s family paid for the construction, and she never intended to (and never did) put the property in her husband’s name as well. 

Then, the court was to consider how to divide the increase in value of the inherited property. However, by the time of trial, the wife had sold the property to her nephew. She explained that she desperately needed the money, so she sold it for a value equivalent to $300,000. The wife was not found to have dissipated the asset, as she simply converted it into cash. While there was some evidence to suggest that the apartment was sold for lower than its market value, the court accepted that it was reasonable for her to accept a lower offer, as she needed the money, the economy was poor in Iran, and it was difficult to trust funds from a third party as compared to a family member. 

By the time of trial, there were little funds left of the $300,000, as much of it was used to pay off the wife’s loans and expenses, which the court accepted were high costs. While the court did not find dissipation, there was no value left to divide this matrimonial property and no evidence of the increase in value. 

As the husband owned Iranian properties, the court decided to set off the wife’s interest in them against any interest the husband may have had in her inherited property. 

Husband claimed his overseas properties were owned by his uncle

The wife claimed that the husband held multiple properties in Iran. the husband claimed that these were held by third parties, such as his uncle, even though they are listed in the husband’s name according to the title deeds. The wife obtained these title deeds from the court in Iran, as the husband did not disclose them.  

The husband claimed that he had given the uncle a power of attorney to deal with the properties, suggesting he could not do so as an alleged owner. The husband also did not provide a copy of the power of attorney. As one of the properties was sold, the court found that the uncle had represented the husband during the sale, according to the wording of the sale agreement. 

The wife also found a spreadsheet with the husband’s name, which recorded detailed payments and deposits regarding properties in Iran. The spreadsheet also did not reference any payments made to his uncle. 

Overall, the husband did not provide adequate evidence to suggest that his uncle or other third parties owned the properties. 

Mincher Koeman Lawyers Can Assist with Matrimonial Property Division Involving Overseas Property

One or both spouses may own property overseas, creating challenges in property division upon divorce. There may need to be more evidence or valuations of these easily obtainable properties. The valuation and division of overseas matrimonial property is a complex matter that is highly specific to the circumstances of the case, so you should speak with one of our family law lawyers at Mincher Koeman, who are experienced in assisting with issues involving property division, including for overseas property. Our Calgary family law lawyers are dedicated to finding the best resolution for you after your divorce.

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

A team above all. Above all a team.

Calgary Office

707 7 Ave SW #1300,
Calgary, AB T2P 3H6

Canmore Office

621 10 St #101
Canmore, AB T1W 2A2

Website designed and managed by Umbrella Legal Marketing