The Family Law Act in Ontario is designed to encourage and strengthen the role of the family in society. Recognizing the equally crucial roles each spouse holds within a marriage is essential to this aim. The law on family matters is very clear and properly set out in Canada, though it may vary from province to province and clauses of the law might not be interpreted the same way for all cases.
Case Study: Division of Matrimonial Home
When a couple separates, many financial problems arise. The most common issue is what to do with the jointly owned home, also known as the matrimonial home.
What is a Matrimonial Home?
A matrimonial home in Ontario is any property where a married couple lives together, known as their family residence. Both spouses have equal rights to the home, regardless of ownership, and even a marriage contract cannot limit this right. This includes vacation homes or cottages if used as a family residence. Neither spouse can sell or mortgage the home without the other’s consent. The court can grant “exclusive possession of the matrimonial home” in certain situations, such as when one spouse has a greater need to stay in the home for the well-being of children or due to financial hardship, which outweighs the other spouse’s need to sell the home. You may take detailed advice on your matter by a family lawyer.
The most common problem occurs in deciding the fate of the jointly owned home. For any separated couple, continued joint ownership of their matrimonial home is unrealistic as they want to end their chapter together and move on different paths. They have two options: one spouse can buy out the other’s share, or they can sell the home on the market and split the proceeds. This allows each party to start fresh without the complications of shared property.
A unique case concerning the division of a matrimonial home was presented to Justice Somji in Rastkar v. Soltani, 2024 ONSC 1384. The couple had separated in July 2020, with the wife continuing to reside in the home with their two children. In August 2023, the court ordered the home to be listed for sale.
Husband’s Low Bid and Court Proceedings
As soon as the house was listed for sale, either spouse could make an offer to purchase it, which is what the husband did. The home was initially listed for $799,000 in September 2023. The bidding was closed, meaning no bidder could know the competitors’ offers. The husband submitted the only offer at $650,000, significantly lower than the home’s estimated value. The wife rejected the offer, leading the husband to initiate court proceedings. He also contacted the real estate agent to suspend the sale until the matter was resolved in court, claiming his ex-wife breached the duty of honesty and good faith by rejecting his “valid fair market offer.”
Judge’s Decision
Justice Somji clarified that the husband had the right to make an offer to purchase as part of the bidding process. However, if the husband participates in the bidding process, he must compete with other interested buyers, following the designated rules and without using any inside knowledge to gain an unfair advantage.
“The case law makes clear that the owner must participate in the bidding process and comply with all the formalities of that process as would any other third-party bidder and the home should be sold to whoever makes the highest offer within that fair process.”
The judge also addressed whether the wife was obligated to accept her ex-husband’s offer. The listing agreement did not include any clause requiring either spouse to accept a purchase offer. It was argued that, as a joint owner, the wife was entitled to hold out for the highest fair market value available.
Court’s Order
The judge discarded the husband’s claims about the wife’s conduct, noting that his bid was significantly lower than the fair listing price he had initially agreed upon. The husband also argued that his wife’s rejection of the offer delayed the sale of the home. However, the judge disagreed, finding that it was the husband’s actions that caused the delay. He initiated court proceedings and directed the real estate agent to suspend the sale, ultimately leading to the postponement of selling the house.
In this case, the judge ordered the husband to pay $5,000 to the wife for court fees, as the husband had misjudged the situation and taken unnecessary actions. Additionally, the judge directed the home to be relisted at $750,000, with a clause stating that the price would be reduced by $20,000 every 30 days until sold. This approach aimed to set a clear path for resolving the sale of the property.
Contact Us Today for Your Family Law Matters!
Handling family law issues, especially the division of a matrimonial home, can be challenging. At Nanda & Associate Lawyers, we offer top-notch solutions for all family law problems. With our dedicated team of family lawyers, we handle each case with care and professionalism. Whether you need help with home division, custody arrangements, or other family matters, we provide exceptional legal support to ensure fair and equitable outcomes. Call us at 905-405-0199 today.
Read Legal Disclaimer : https://www.demo-sites.co.in/legal-disclaimer/
