The New Family Law Act Highlights of the changes
The Family Relations Act (FRA) will cease to exist,and will be replaced by the Family Law Act (FLA)Theon Marchwill modernize new Act 18, 2013. family law in British Columbia, and bring about significant changes infamily law, most notably in
Some areas of family law will remain relatively unchanged.• These include:• Child support• Spousal support
The most significant changes concern:• Parenting• Property division• Alternate dispute resolution• Enforcement of court orders• Assisted reproduction
Gone are the words "custody"• and "access" New terms are:• parenting arrangements• parenting responsibilities and• parenting time
"Guardianship" remains• but with redefined to Parents who live is their children prior separation will both be guardians automatically• A parent who never lived with the child is not a guardian unless they regularly care for the child, or are appointed a guardian.• Only guardians have parenting responsibilities or parenting time.
The property division scheme is changing• completely Property division rules will now be the same for both married and common-law spouses• No more "family use" test to determine if an asset is a family asset.• There are now included assets and excluded assets.• "Family debt" is defined.
What is a common-law spouse?• The definition of common-law spouse is changing slightly for the purposes of spousal support.• The FRA definition: two persons who live together as spouses for more than two years.• The FLA definition: two persons who live together as spouses for more than two years, (for the property division sections) or have lived together for less than two years but have a child together. (for the support provisions)
What is Family Property?• All real or personal property owned legally or beneficially by one or both spouses at the date of separation• Includes :• Share or interest in a corporation,• Interest in a partnership, organization, business or venture,
What is Family Property?• Money in an account at a financial institution,• Entitlement to an annuity, pension, or RSP,• Property disposed of during the relationship which the spouse retains authority to require return or direct its use,• Property acquired with the proceeds of any of the above,• The increase in value of "excluded property" since the relationship began.
What About Trust• Property?of trust property Family property includes that part contributed by a spouse to a trust which:• The spouse is a beneficiary and has a vested interest in that part of the trust property not subject to divestment, or• The spouse has power to transfer to him or herself that part of trust property, or• The spouse has the power to terminate the trust and on termination that part of trust property reverts to the spouse.
What is Excluded Property?• Property acquired by a spouse prior to relationship• Gifts or inheritances to the spouse• Personal injury awards• Any of the above held in trust for the spouse
What is Excluded Property?• Property held in a discretionary trust:• - to which the spouse did not contribute,• - of which the spouse is a beneficiary, and• - that is settled by a person other than the spouse.
The Problem• while the value (as at the start of the relationship) of excluded property is exempt from division upon separation, the increase in growth is not, and must be shared equally. This includes trust property.• The spouse is entitled to 50% of the increase in value of the discretionary trust, no matter how many beneficiaries there are.• Amendments to this section are expected before the FLA is proclaimed.
What about Family Debt?• Previously not defined in the FRA• Under the FLA defined as:• All financial obligations incurred by a spouse during the relationship; or• after the date of separation, if incurred for the purposes of maintaining family property
Property Division• Family property and family debt are divided equally between the spouses unless it would be "significantly unfair", in which case the court can order an unequal division.• The test for an unequal division is more stringent than under the FRA.
What Valuation Date is used?• The value of family property or family debt must be determined as of the date an agreement is made to divide family property or debt, or the date of the hearing to divide family property or family debt.• For excluded property we will also need to know the value at the start of the relationship.
Time Limits• An action for division of family property and allocation of family debt must be brought:• Within two years of the date of divorce or annulment for married spouses.• Within two years of the date of separation for unmarried spouses.• This time limit is suspended if the parties are engaged in alternate dispute resolution.
What is a Triggering Event?• Under the FRA there were several events which could trigger the right of a spouse to an undivided half interest in family assets.• These events could be strategically planned.• Under the FLA the only date is the date of separation.
Transition• Orders or agreements made under the FRA will continue to be governed by the FRA• A property division proceeding commenced under the FRA will be determined by the FRA, unless both parties agree otherwise.• New actions will be governed by the FLA.