The division of property and assets can be one of the more challenging and divisive parts of a separation or divorce. The matrimonial home is an item that can’t be divided, and as a result, it almost always ends up in the possession of one of the parties or it gets sold with the parties dividing the proceeds from the sale. But what happens when one spouse wants to buy the home from the other, but the other spouse would rather sell it? That was a decision recently addressed by the Court of Appeal for Ontario.
The outcome of the first trial
The parties went through a four-day trial to resolve financial issues following their separation. It ended with the husband owing the wife an equalization payment of $226,670.96. The trial judge also ruled that the husband had the “right to conclude the purchase” of the wife’s interest in the jointly owned matrimonial home.
However, the wife did not want to sell her interest in the home to the husband. Instead, she argued at appeal that she should be able to sell the home and split the net proceeds with the husband.
The husband did not want the house to hit the open market and initially refused to participate in the appeal, arguing that the appeal belonged in Divisional Court and that the trial judge should be allowed to explain his ruling. He also stated that he had been required to live in a trailer while the wife lived with her mother, leaving the matrimonial home empty. He sought compensation for this.
The court’s analysis
The court explained that it was the correct avenue for the appeal to be heard and that Divisional Court judges do not defend their own decisions. The court also determined that the wife had legitimate grounds to appeal.
The leading case on the issue is a 1992 decision from the Court of Appeal for Ontario. It stated that a right of first refusal is a substantive right that has an economic value associated with it and that it falls outside of what is reasonably necessary to sell an item, in this case, a home. The court added that giving the husband the right to purchase half of the home without it being on the market may reduce the amount ultimately paid for the home since there is no competition. This led to the court reversing the lower court’s decision, stating that if the husband wants to purchase the home, he must do so on the market in competition with other interested buyers.
Following a separation, you will need a divorce to legally end your marriage. Often, the terms of your separation agreement will become the terms of your divorce settlement. This is why it is so important to speak with a knowledgeable lawyer from the very start of your separation and divorce proceedings.To discuss your legal needs with a Windsor separation lawyer, call 519.973.1500 or contact us online. We serve clients in Windsor, Essex County and throughout the region.