Family Lawyers Helping Separated and Divorced Clients with Inheritance Issues

Questions about how marriage affects an inheritance are common. Clients who are the recipients of an inheritance are often curious about whether the inheritance will be protected from their spouse in the event of a separation or divorce. Other clients wonder whether they would be entitled to their spouse’s inheritance in the same situation. Division of property in family law is itself a very complex endeavour, let alone the division of property where an inheritance is involved. In order to protect yourself and your assets, or to ensure you obtain what you may be legally entitled to, it is critical to get knowledgeable legal advice as early as possible.

At Gelman & Associates, we have provided legal assistance to clients on either side of the inheritance coin: those who seek to protect their inheritance and those looking to access their spouse’s. We have significant experience advising clients on division of property, understand how inheritances have been addressed by courts in the past, and use this deep knowledge base to guide clients through this challenging area of the law.

Excluding an Inheritance from the Equalization Process

In Ontario, married couples who divorce will go through an equalization process, which essentially divides the couple’s total property value in half – but in most circumstances, pursuant to section 4(2) of the Family Law Act, an inheritance can be an excluded from equalization.

If an inheritance is received before the marriage, it is not included in the division of assets at the time of divorce.  If an inheritance is received after the marriage, whether it will be included in the division of assets will depend on the treatment of the inheritance.

In order for the inheritance to be considered an exclusion under section 4(2), the inheritance must be identifiable and traceable.  Real property (i.e. a cottage, boat, piece of art, etc.) is easily identifiable and automatically excluded. Similarly, funds that go into (and stay in) a savings account in the inheritor’s name are readily identifiable and traceable.   In contrast, funds that have been put into a joint account and used to benefit the family’s lifestyle can be difficult to trace and exclude. For instance, an inheritance used to fund family vacations or similar may be more difficult to exclude.

Although Ontario laws generally protect an inheritance received after the time of marriage, it does not fully protect financial gains such as property purchased with the inheritance, or growth due to interest on the inheritance.

Contractual Agreements regarding Inheritance

The law in Ontario allows couples to make contractual arrangements that could change how an inheritance is handled.  These are referred to as either a pre-nuptial agreement (a contract entered into before marriage), a cohabitation agreement (a contract entered by cohabitating spouses that may end up getting married in the future), or a marriage contract (an agreement between a married couple).  If one of these domestic agreements is in place, the treatment of your inheritance will be subject to the terms of the domestic agreement.

Contact our Family Law Lawyers in Aurora, Barrie, Downtown Toronto, Mississauga, North York and Scarborough for Advice on How to Protect your Inheritance

The best time to get advice on how to protect your inheritance is as soon as you know you may receive one (or as soon as you receive it).  Even if you are not separated or divorced, our team of knowledgeable family lawyers can advise you how you can best protect your inheritance from future uncertainty.  And if you are going through a divorce, we will fight for your best interests. Call us at (416) 736-0200 or 1-844-736-2022 or contact us online to see how we can help.

From the Blog

Latest posts from the Gelman & Associates blog

11

Wealthy Husband Ordered to Pay Wife Spousal Support of $30,000 per Month

In a recent case, an Ontario court considered the interesting question of how much spousal support should be awarded to a wife whose husband earned approximately $2,090,000 per year. The Parties’ Story The parties began to cohabit in December 2001, married in June 2006 and separated in May 2017. While the husband was a very …


Read More
05

When Will Courts Consider Forgiving Arrears For A Parent Or Spouse?

Child support and spousal support obligations are serious, and failing to pay them could leave a parent in arrears, and a large debt to repay.  Only in certain situations will courts retroactively discharge or rescind support arrears. A recent case from the Ontario Superior Court of Justice serves as a good summary of which types …


Read More
28

Court Finds Mother in Contempt

Court orders cannot be ignored or disobeyed, and complying with a court order is not optional. In a recent case, an Ontario court considered whether or not the mother of a young child was in contempt for refusing to grant access to the child’s paternal grandmother in accordance with a previous order. What Happened? The …


Read More

Contact

Questions? Send us an email

Contact Form - Home
Sending