The wife appealed an order providing for an unequal division of matrimonial assets. The parties were married for 25 years, this marriage both their second. At the time of the marriage, the husband owned a small farm where the parties lived from 1975 to 1984, when the farm was sold. The proceeds from the sale of the farm were invested, and it was contemplated that they would be used for the couple's retirement. The parties separated in 2000. At the initial trial, the husband argued that the proceeds from the sale of the farm were business assets within the meaning of s. 2(a) of the Matrimonial Property Act and therefore exempt from matrimonial property. The trial judge found the proceeds of sale to be a matrimonial asset, but divided the proceeds two-thirds in favour of the husband to reflect his pre-marriage ownership. The balance of the matrimonial assets was divided equally.
- Should the unequal division of assets be allowed to stand?
Appeal allowed; order for equal division.
Bateman, writing for a unanimous bench, held that the trial judge erred in her application of the Act. She correctly identified the proceeds from the sale of the farm as matrimonial assets and s. 12 requires the court to make an equal division unless it is satisfied that the equal division of matrimonial assets would be unfair or unconscionable. In the case at bar, the trial judge did not give proper consideration to s. 13. She decided that, because the farm had a significant value at the time of the commencement of the parties' relationship, a division in favour of the husband was warranted when the Act requires her to determine whether an equal division would be unfair or unconscionable. The fact that respondent brought the farm into the marriage was not a sufficient factor to make an unequal division of the asset. It could not have been intended that matrimonial assets be routinely divided unequally in favour of the contributing spouse.
As for the husband's claim that the farm was a business asset, the proceeds were clearly for the common usage and benefit of both parties. The purpose of the sale of the farm was to provide an income for the parties' retirement; not only was a house built and other capital expenditures made, but withdrawals were made for regular living expenses. Further, the husband was not engaged in a business when he invested and managed the sale proceeds.
- In long term marriages (generally 20+ years), parties should expect to share everything which was brought into the marriage, regardless of who brought the assets in.
- There is no presumption in favour of parties who brought more into the marriage.
- When assessing an unequal division of assets under s. 13, the only thing to be considered is whether equal division would be unfair or unconscionable; not whether an unequal division would be more fair.