It is an issue that is not on the radar when a decision is made to move to
a different Canadian jurisdiction, whether because of a new job, for
retirement, or to be closer to family.
While all provinces and territories have some scheme of statutory property
division on marital breakdown, surprisingly, death is not a triggering
event for a property claim in all Canadian jurisdictions. Of those that do
permit a claim to be made on death, some limit the claim to legally married
spouses only, while others extend the claim to non-married cohabiting
spouses provided that certain requirements are met.
In British Columbia, Alberta, Prince Edward Island, and Yukon, death does
not trigger a right to make a statutory property claim. This leads to the
anomalous result that you have better rights on a marriage breakdown in
those provinces than when your spouse dies.
In Ontario, New Brunswick, and Newfoundland and Labrador, statutory
property division claims on the death of a spouse are available to legally
married spouses – not to common law spouses. In Ontario, the claim is known
as a claim for equalization of net family property. In Quebec, these claims
are extended to both legally married surviving spouses and the survivor of
couples who have a civil union.
In Saskatchewan, Northwest Territories, and Nunavut, statutory claims for
property division on death are extended to non-married cohabiting partners
who meet certain requirements. There is the ability to file a declaration
in Nova Scotia or register a common law relationship in Manitoba which can
extend the right to property division on death.
A couple that moves from Toronto to Calgary will find that on the death of
the first spouse, the surviving spouse does not have the right to
equalization of property that he or she enjoyed in Ontario. And conversely,
the common law couple who live in Vancouver who did not have any statutory
rights to property division if one of them died who then move to Saskatoon
will find the surviving partner gaining additional rights that both may
never have anticipated.
In a prior article,
For Better or For Worse…Especially if You Move, we pointed out how an international move to a different country,
including civil law countries with a community of property regime, can
unexpectedly change rights arising from marriage. But within our own
country as well, it can be “for richer or for poorer” when it comes to
matrimonial property division on death.
What is the solution to meeting the challenges of these different laws? In
general, a marriage contract or cohabitation agreement can address rights
to property division on death. Few couples, however, consider the impact of
a change in residence on rights on death in conjunction with a move.
As with any move to another jurisdiction, a 360-degree review of all legal
consequences, including on one’s estate plan, with the assistance of an
experienced legal advisor is key – including that move down the TransCanada
is the principal of the Toronto-based trusts and estates law firm
O’Sullivan Estate Lawyers. She practices exclusively in the areas of estate planning, estate
litigation, advising executors, trustees and beneficiaries, and
administration of trusts and estates. This article originally appeared
O’Sullivan Estate Lawyers blog. Reprinted with permission.
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