How it Works and Steps to Make it Easier

When you are ready to tackle the issue of dealing with assets and debts, it is helpful to make a list of all the assets and debts in your name and those in your spouse’s name. It is not unusual to not know the complete financial picture of your spouse. The legislation requires each spouse to disclose to the other all property and debts in their name. Each spouse will ultimately complete and sign a form which sets out their respective assets and debts. If a spouse does not voluntarily disclose their assets and debts they can be ordered to do so by the Court. 

The value of property is generally determined as of the date of separation (the "market value" as of that date). To determine the market value of an item, it can be appraised by a professional appraiser. Often spouses will agree as to the value of minor items to avoid appraisal costs. Bank account statements, credit card statements, investment statements etc will prove the value of the property at the date of separation. Vehicle values can be determined using a Black Book Value or consulting with a dealership. Prior to meeting with your lawyer it is best to have as many of these documents compiled as possible, but we realize that cannot always be accomplished due to competing priorities.

Once the value of assets and debts are determined, a Family Property Act accounting (for non joint assets or debts) can be completed.  More often than not, this can be resolved with the help of lawyers, or a mediator.  The total of Party A’s assets less their debts provides a net position for Party A. The same is done for Party B. The net positions are then equalized. Each party should end up with one half of the total value. For example:

                Party A has $10,000 of assets and $2,000 of debts for a net position of $8,000

                Party B has $15,000 of assets and $5,000 of debts for a net position of $10,000

Total: $18,000/2 = $9,000 to each party. Party B would thus owe Party A $1,000 to equalize their positions 

While this sounds simple enough, the devil is often in the detail.  Certain assets and liabilities are more complicated to value, and there may be hidden tax issues.