When dealing with division of assets in divorce, the Courts in Nova Scotia start with the presumption that property is divided equally among married spouses. This presumption, based on the Matrimonial Property Act, is not absolute and there are certain exceptions. The exceptions are limited and whoever does not want something included must prove to the satisfaction of the Court that it should be excluded.
Exceptions to Splitting Assets in a Divorce
One such exception is property that can be described as a gift or inheritance, such as cash or land. This exception is not guaranteed. Depending on what you do with the inheritance, you could be required to divide all, or a portion of, it with your spouse upon separation or divorce.
What Is Considered a Gift in Divorce?
Gifts and inheritances can be found exempt from property division for married couples as long as such property has not been used for “the benefit of the family.” An example would be a cottage that is inherited by one spouse, but then used and maintained by the family for their summer vacations during the marriage. The cottage, although inherited, can no longer be said to be exempt, as it was then used by the family.
However, even if the property was used for the benefit of the family, it can sometimes be proven that equal division upon divorce would be unfair. These situations are very fact specific and the family law lawyers at Lenehan Musgrave LLP are experienced in assisting with matrimonial property division and the determination of inheritance division.
Common law spouses should also be wary of division of inheritances upon separation. Generally, property owned by common law couples is not subject to the assumption that it is equally divided on separation. If the item has been used for the benefit of the family, common law spouses also have rights to bring property division claims under equitable remedies such as unjust enrichment.
Inheritance and Divorce
There are always steps that you can take to protect your inheritance in the event of a separation or divorce. It is always important to document and keep proof that you received the inheritance, including a copy of the Will and/or any letters from the Estate.
An option to protect an inheritance is to enter into a Marriage Contract with your spouse if you are married. If you are in a common law relationship, you can enter into a Cohabitation Agreement. These types of agreements could allow flexibility with the use of the inheritance with more protection should it be needed upon separation.
The protection and division of inheritances depends greatly on the circumstances. If you have questions about protecting your inheritance, the division of assets in divorce or dividing an inheritance received by your spouse, contact the family law lawyers at Lenehan Musgrave LLP today.
