Ownership on Title Does Not Determine Matrimonial Home Division in Ontario Divorce
Many married couples take title to their matrimonial home as tenants in common with unequal shares — for example, 70% to one spouse and 30% to the other — rather than as joint tenants. Upon separation, it is a common misconception that the property will be divided according to these registered percentages. Under Ontario family law, this is incorrect.
The Key Principle: Equalization of Net Family Property
Under Ontario’s Family Law Act, married spouses are subject to the Net Family Property (NFP) equalization regime. Property division is not based on title ownership percentages. Instead:
- Each spouse calculates their Net Family Property (NFP)
- The difference between the two NFPs is determined
- An Equalization Payment is made to equalize the difference
Example
Assume the couple’s only asset is a matrimonial home valued at $1,000,000, registered as:
- Husband: 70% ($700,000)
- Wife: 30% ($300,000)
With no other assets or debts:
| Husband | Wife | |
|---|---|---|
| Home value | $700,000 | $300,000 |
| Less pre-marriage property | $0 | $0 |
| NFP | $700,000 | $300,000 |
Equalization Calculation:
($700,000 − $300,000) ÷ 2 = $200,000
➡️ The husband pays $200,000 as an Equalization Payment
➡️ Each spouse effectively receives $500,000 regardless of title ownership
Conclusion
Ownership percentages on title only affect how Net Family Property is calculated, but they do not determine the final division of property in an Ontario divorce.
The guiding principle under Ontario family law is that wealth accumulated during marriage should be shared equally between spouses.
To opt out of equalization, spouses must enter into a valid Marriage Contract in accordance with the Family Law Act.
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