When a marriage ends because of an affair, it is understandable that the innocent spouse may feel that the other person’s conduct should affect how property is divided.
In Ontario, however, adultery itself generally does not change the equalization of net family property.
Ontario’s Family Law Act is primarily concerned with the financial circumstances of the spouses and the value of their property, not with punishing marital misconduct. The usual rule is that when married spouses separate, the spouse with the lower net family property is entitled to one-half of the difference between the spouses’ net family properties.
There are limited circumstances in which a court can order an unequal division. The key question is generally not whether one spouse behaved badly, but whether conduct involving property, debts, disclosure, or financial decisions makes ordinary equalization unconscionable.
Key Takeaways About Adultery And Property Division In Ontario
- Adultery does not automatically entitle the other spouse to a larger share of family property.
- Ontario’s equalization system generally does not punish spouses for marital misconduct.
- Financial consequences can matter where conduct affects the acquisition, preservation, disposition, or depletion of family property.
- Spending significant family assets on an affair may potentially become relevant if it materially affects net family property.
- Hiding assets, failing to disclose liabilities, or intentionally or recklessly depleting property can also become relevant.
- Property located outside Ontario or Canada must still be properly identified and valued when calculating net family property.
- Anyone concerned about hidden or depleted assets should obtain advice from a Toronto property division lawyer before assuming that misconduct will or will not affect the result.
Does Adultery Affect Property Division In Ontario?
Usually, no. Ontario family law does not generally use property division to compensate one spouse for the emotional harm caused by adultery.
Section 5 of the Family Law Act establishes the equalization process. In general, the spouse whose net family property is lower is entitled to one-half of the difference between the spouses’ net family properties.
The legislation also gives courts limited authority to award more or less than half of that difference where ordinary equalization would be unconscionable.
The focus of that exception is financial.
The Act identifies circumstances such as reckless or bad-faith debts, intentional or reckless depletion of net family property, failure to disclose certain liabilities, and other circumstances connected to the acquisition, disposition, preservation, maintenance, or improvement of property.
That means the question is not simply, “Did my spouse commit adultery?”
The more relevant question is often, “Did my spouse’s conduct significantly affect our property or finances?”
Why Marital Misconduct Is Usually Irrelevant To Equalization
Ontario’s equalization regime is designed around the financial partnership of marriage.
The Family Law Act recognizes that spouses may contribute to a marriage in different ways, including through childcare, household management, and financial provision.
For that reason, equalization generally starts from the principle that the increase in family wealth accumulated during the marriage should be shared according to the statutory calculation.
A court does not ordinarily adjust that calculation because one spouse had an affair, behaved dishonestly, ended the marriage, or was responsible for the breakdown of the relationship in other ways.
Those issues can be deeply important to the people involved, but they do not necessarily affect the financial calculation or the legal outcome of a divorce.
When Can An Affair Become Relevant To Net Family Property?
An affair can become relevant where the financial consequences of the conduct affect net family property.
For example, one spouse might allege that the other used significant marital funds to pay for:
- Travel
- Hotels
- Gifts
- Rent
- Vacations
- Entertainment
- Transfers of money
- Other substantial expenses connected with an extramarital relationship
The existence of those expenses does not automatically produce an unequal division.
The financial impact must still be assessed in the context of the spouses’ overall property and the demanding statutory test for unequal equalization.
Ontario’s Family Law Act specifically allows a court to consider the intentional or reckless depletion of a spouse’s net family property when determining whether ordinary equalization would be unconscionable.
The Ontario Court Of Appeal On Affairs And Financial Consequences: A Case Study
There have been instances in the past in which Ontario courts have allowed unequal division of net family property due to adultery.
A 2016 Ontario Court of Appeal case saw a wife seek an unequal division after discovering that her husband had been involved in a long-term affair and had allegedly spent money on the relationship and related activities.
The important lesson from the case was not that an affair itself entitled the wife to additional property. Instead, the Court emphasized that allegations of marital misconduct that have no financial consequence are generally irrelevant to the property dispute.
However, where a spouse alleges that financial resources were depleted through the conduct, the financial impact may be investigated as part of the equalization claim.
This distinction remains important.
Ontario family courts are not intended to determine who was morally responsible for the marriage ending. They may, however, need to determine whether one spouse’s financial decisions materially affected the property available for equalization.
What Other Financial Misconduct Can Affect Equalization?
Adultery is only one context in which questions about financial conduct may arise.
Section 5(6) of the Family Law Act identifies several circumstances a court can consider when deciding whether equalizing net family property in the ordinary way would be unconscionable.
These include:
Reckless Or Bad-Faith Debt
A court may consider debts or liabilities incurred recklessly or in bad faith where those debts have been claimed in the calculation of net family property.
Intentional Or Reckless Depletion Of Property
A spouse who deliberately or recklessly reduces their property before separation may face scrutiny if doing so significantly affects the equalization calculation.
Failure To Disclose Certain Liabilities
The legislation also addresses circumstances involving a spouse’s failure to disclose debts or liabilities existing at the date of marriage.
Other Property-Related Circumstances
The Act permits consideration of other circumstances relating to the acquisition, disposition, preservation, maintenance, or improvement of property.
The threshold for unequal equalization remains high. A disagreement with how a spouse spent money during the marriage does not necessarily make ordinary equalization unconscionable.
What If A Spouse Hides Assets During Divorce?
Hidden assets can present a different issue from ordinary marital misconduct because accurate equalization depends on proper financial disclosure.
Each spouse’s net family property calculation must reflect the assets and liabilities that are legally relevant to the calculation.
Potentially significant undisclosed property might include:
- Bank accounts
- Investment accounts
- Real estate
- Cryptocurrency
- Corporate interests
- Trust interests
- Valuable personal property
- Foreign accounts or property
If one spouse believes property has not been disclosed, a Toronto property division lawyer can help assess what information may be required and what steps may be available to obtain disclosure.
Do Foreign Assets Count In Ontario Equalization?
Property does not become irrelevant simply because it is located outside Ontario.
Spouses may own assets elsewhere in Canada or internationally, including:
- Vacation properties
- Rental real estate
- Foreign bank accounts
- Investment accounts
- Retirement assets
- Businesses
- Land
- Other financial holdings
Those assets may need to be identified, valued, and considered when calculating net family property.
The process can become more complicated where ownership documents are located in another jurisdiction, property must be valued in a foreign market, or currency conversion is required.
For example, valuing foreign real estate may require an appropriate appraisal, while international business interests may require professional valuation evidence.
Financial Disclosure Of Out-Of-Province And Foreign Property
Full and accurate financial disclosure is essential to a proper property settlement.
Documents relevant to assets located outside Ontario or Canada may include:
- Foreign bank statements
- Investment account records
- Property title documents
- Mortgage statements
- Corporate records
- Business valuations
- Appraisals
- Tax records
Difficulty obtaining documents from another jurisdiction does not necessarily remove the asset from the financial analysis.
Where a spouse believes international property has been omitted or undervalued, legal and valuation advice may be needed.
Is An Unequal Division Of Net Family Property Common?
Unequal equalization is an exception to the ordinary rule.
The Family Law Act uses the term unconscionable, which creates a significant threshold. A spouse should not assume that behaviour they consider unfair, irresponsible, or immoral will necessarily meet that legal standard.
Cases involving alleged depletion, undisclosed property, reckless debts, or other misconduct depend heavily on the evidence and the financial significance of the conduct.
This is why it is important to distinguish between relationship misconduct and financial misconduct affecting property.
Frequently Asked Questions About Adultery And Equalization of Net Family Property In Ontario
Does Adultery Affect Property Division In Ontario?
Generally, adultery itself does not change the equalization of net family property. Financial conduct connected with an affair may become relevant if it materially affects property, debts, or liabilities and the statutory requirements for unequal equalization are met.
Is Adultery Considered Misconduct Under The Family Law Act?
Marital misconduct alone is generally not the focus of Ontario’s property division regime. The relevant issue is whether conduct has a financial consequence connected to property or liabilities.
Can I Get More Property Because My Spouse Cheated?
Not simply because the affair occurred.
A larger or smaller equalization amount may be ordered only in limited circumstances where the legal test under the Family Law Act is met.
What If My Spouse Spent Family Money On An Affair?
Significant spending may be relevant if it affected the spouse’s net family property and supports a claim involving intentional or reckless depletion or another applicable provision of the Family Law Act.
Whether the spending is legally significant depends on the amount, evidence, overall finances, and circumstances.
What If My Spouse Has Money Or Property Outside Canada?
Foreign property may still need to be disclosed and considered when calculating net family property.
International assets can make disclosure and valuation more complicated, but their location outside Canada does not automatically exclude them from the analysis.
Can Hidden Assets Change An Equalization Payment?
Potentially. An equalization calculation based on incomplete or inaccurate financial information may not reflect the spouses’ true net family properties.
A lawyer can help determine what disclosure should be requested and how disputed assets should be addressed.
Speak With A Toronto Property Division Lawyer Today
Property division after separation can become particularly complicated where there are allegations of asset depletion, undisclosed property, unusual debts, foreign assets, or significant spending during the marriage.
The important question is not simply whether one spouse engaged in misconduct or cheated on their partner. The legal analysis focuses on how the spouses’ property should be calculated under Ontario law and whether any financial conduct affects that calculation.
Our Toronto family lawyers at Gelman & Associates assist clients with equalization, financial disclosure, hidden or foreign assets, the matrimonial home, business interests, and other property disputes arising from separation and divorce.
To discuss your situation with a Toronto property division lawyer, call 1-844-736-0200 or contact Gelman & Associates to book a consultation.
