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The Matrimonial Home and Real Estate Transactions

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The matrimonial home is defined in section 18(1) of the Family Law Act (FLA) as “Every property in which a person has an interest and that is or, if the spouses have separated, was at the time of separation ordinarily occupied by the person and his or her spouse as their family residence is their matrimonial home”.

In Ontario, rights relating to the matrimonial home are limited to married spouses. They do not extend to common-law spouses, no matter how long they have been cohabiting together. In order to qualify as a matrimonial home, the property must be located in Ontario and be “ordinarily occupied” by the spouses. This means that the property is used regularly as a family residence or was used as such during the time of separation. According to section 19(1) of the FLA, both spouses have equal rights to possession of the matrimonial home.

It is possible for more than one property owned by one or both spouses to be classified as a matrimonial home. This is often the case when spouses regularly use a vacation home in addition to their primary home.

When it comes to selling or mortgaging a property in Ontario, property owners may be surprised that the consent and signature of a non-titled spouse is required in order to complete the transaction. This is because matrimonial property rights apply notwithstanding that the spouse is on title or not. If the titled spouse attempts to sell the property without the non-titled spouse’s consent, the purchaser may end up obtaining title which is subject to that spouse’s legal interest. Similarly, the non-titled spouse will be required to consent to any mortgage transaction. Likewise, if the consent is not obtained, the lender’s security will be subject to the non-titled spouse’s interest.

The exceptions to the rule regarding spousal consent are threefold and can be found in section 21 of the FLA. The first is that the non-titled spouse releases all their rights to the home under a separation agreement that has been drawn up between the separated spouses. If such an agreement exists, it must be provided to the lawyer who is representing the owner in a sale or mortgage transaction. The second exception involves court authorization of the transaction without spousal consent. Lastly, the third exception involves a property which would under normal circumstances be classified as a matrimonial home, but for the registration by both spouses of a matrimonial home designation on a separate property. To clarify, in Ontario, spouses may choose to formally register a matrimonial designation on the title to a property. This is not necessary in order for a property to be classified as a matrimonial home, however when this is done, it means that no other property owned by one or both of the spouses may be classified as a matrimonial home. As such, spousal consent would not be required for such a property.

Whether you are purchasing, selling, or mortgaging a property, you should advise your lawyer of your spousal status, and the nature of the occupation of the property in question as early as possible, to enable them to determine whether spousal consent will be required in a given transaction.

 

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Reem Haroon is an Associate Lawyer at Kormans LLP. Her practice areas include Real Estate Law, Corporate Law and Wills/Estates Law. You can reach Reem at rharoon@kormans.ca.

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