There is no such thing as being “legally separated” in British Columbia. Family lawyers are often asked this question because Canadians hear this term being used in American media, TV shows, or movies.  In the United States, Americans can become “legally separated” by filing a Statutory Declaration of Separation or petition to become legally separated, but this is not done in Canada.

The “date of separation” can be agreed upon between two spouses or determined by a judge or arbitrator, and anyone can file their income taxes as “Separated” if he or she believes this to be the case.

You are not legally required to sign a Separation Agreement or get a divorce after separation, but you should consult with a family lawyer (and a wills & estates lawyer) to discuss your potential risks if you remain in the same household with your spouse and/or remain married after separation. Almost any family lawyer would strongly recommend that you and your spouse sign a comprehensive Separation Agreement after both parties have received independent legal advice. (See What is a Certificate of Independent Legal Advice?)

Property division, debt division, and support (both spousal and child support) claims become complicated if there is a long period of time between the date of separation and the date of a Separation Agreement and/or divorce. There are important things to keep in mind if you’re thinking about separating without a Separation Agreement or remaining married after separating from your spouse:

• • Pursuant to s. 87 of the Family Law Act, the value of family property and debts that you and your spouse will divide is determined as of the date of an agreement or court order – not as of the date of separation. If the value of family property increases or decreases dramatically due to market trends after the date of separation, both spouses are entitled to equally benefit or equally bear the loss in value. For example, If the value of your investments skyrocket after the date of separation, your spouse is presumptively entitled to equally benefit from the increase in value as of the date you sign a Separation Agreement or go to trial. Likewise, if your spouse keeps the family residence after separation and the housing market plummets before you sign a Separation Agreement or go to trial, the amount of money he or she will have to pay you for your interest in the family residence could reduce significantly.
  • Pursuant to s. 86 of the Family Law Act, each spouse is responsible for any debts they incur after the date of separation unless the debt was incurred for the purpose of maintaining family property. For example, a debt that either spouse incurs for repairs to the family residence after the date of separation would likely be a “family debt.”
  • Any assets acquired after the date of separation are not family assets (and the other spouse is not entitled to them) unless the assets can be traced to family property. For example, if a spouse sells family property to purchase an asset after separation, the other spouse can claim an interest in the new asset. As another example, if your RRSP is worth $100,000 as of the date of separation and you make a $20,000 contribution towards your RRSP using your post-separation earnings, that $20,000 contribution should be excluded from the division of family assets.
  • Pursuant to section 95 of the Family Law Act, either spouse can argue that an equal division of family property or family debt would be “significantly unfair” based on several grounds. For example, if you pay off a family debt or renovate the family residence after the date of separation with your own labour and/or post-separation earnings, you may want to argue that an equal division or family property or debt would be significantly unfair pursuant to s. 95(2)(f) of the Family Law Act: “whether a spouse, after the date of separation, caused a significant decrease or increase in the value of family property or family debt beyond market trends.”
  • It may be difficult and time consuming (and therefore, very expensive) for lawyers and accountants to differentiate between the parties’ “family” and “excluded” financial assets and debts. Likewise, the “significant unfairness” argument is nearly always a challenging and risky argument to make in court. It isn’t uncommon for spouses to sell or dispose of family assets or intentionally decrease the value of family assets after separation. For example, if your spouse started a successful corporation during the relationship, the value of the company is a family asset. If your spouse intentionally causes the value of the company to plummet after the date of separation, you will need to demonstrate that your spouse acted in bad faith and did this intentionally to reduce your share of this family asset. Sophisticated parties can make it very difficult to prove that he or she had ill intentions.
  • Either you or your spouse may be ordered to pay a significant amount of arrears if:
    (a)  you and your spouse have a child (or children) but child support wasn’t paid pursuant to the Federal Child Support Guidelines; or
    (b) spousal support was requested by either party but the other spouse refused to pay spousal support pursuant to the Spousal Support Advisory Guidelines. If it is later determined that spousal support should have been paid, retroactive spousal support is generally ordered back to the date it was requested.

In summary, if you and your spouse have children, or if either of you acquired assets or debts during the relationship, we strongly encourage you to promptly meet with an experienced family lawyer.

The Law Portal offers free 30-minute consults and unbundled legal services to help our clients finalize their separations and divorces within their budgets. It is always our goal to resolve our clients’ issues amicably and cost-effectively with a signed Separation Agreement or Consent Order.