DIVISION OF FAMILY PROPERTY: ENTITLEMENT TO FARMLAND OWNED BY EX-SPOUSE AND THIRD PARTIES

When two parties are separating and dividing the family property, there may be questions surrounding property owned by one of the spouses and third parties. In Saskatchewan, this is particularly true for farmland. Often a husband or wife will own farmland with their parents for estate planning purposes. So how does the court deal with this in the division of family property?

Courts ask two questions: first, is the farmland matrimonial property? And if so, what value should be attributed to it?

The answer to the first question is simple. As defined in The Family Property Act, family property means any real or personal property, regardless of its source, kind or nature, that, at the time an application for separation is made, is owned, or interest is held, by one or both spouses, or by one or both spouses and a third person. A joint tenant owns a legal right in the property by virtue of being a registered owner on title. Therefore, farmland held by one spouse in joint tenancy with their parents is family property as defined in the Act.

The second question is where the true analysis lies – what value should be attributed to the jointly held farmland? If the joint tenancy was legitimately for estate planning purposes, its value for the division of family property will be nil. This is because the spouse, and therefore the family unit, did not collect a benefit from the farmland during the marital relationship. Rather, the spouse was simply on title for estate and succession planning once their parents pass away. Courts will look to factors such as who maintained control over the land, who used the land and who paid the expenses and received the benefits from the land when determining if a transfer of title was truly for estate planning purposes. If there is evidence to suggest the spouse received a benefit from the land during the marital relationship, it will be assigned a monetary value by the court and be subject to division. 

Should you have any questions about the division of family property, or need advice on your family law matter, please contact Robertson Stromberg LLP.

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Area of Expertise Agriculture DIVISION OF FAMILY PROPERTY: ENTITLEMENT TO FARMLAND OWNED BY EX-SPOUSE AND THIRD PARTIES