Common Law Court Ruling


Common-law couples deserve fair share: court

CBCCBC – Sat, 19 Feb, 2011 12:09 AM EST

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Partners in common-law relationships in Canada who separate are entitled to a fair share of assets they contributed to or made possible, the Supreme Court of Canada has ruled. 

In deciding two cases unanimously—involving a couple inVancouver and another in Ottawa — the court applies to common-law couples remedies that are similar to those covering married couples in provincial law.

In the Vancouver case, Margaret Patricia Kerr and Nelson Dennis Baranow, a couple in their late 60s, separated after a common-law relationship lasting more than 25 years.

They both had worked through much of that time, and each had contributed in various ways to their mutual welfare, the court said.

A lower-court ruling awarded Kerr a share of the house they shared, which was in Baranow’s name. That was overturned on appeal, on the basis that Kerr was profiting from “unjust enrichment.”

The supreme court has ordered a new trial in the case, mainly because of the complex financial details involved. Among other things, Kerr suffered a stroke and never moved back into the house.

The Ottawa case involved Michele Vanasse and David Seguin.

In the first four years of their relationship (1993 to 1997), they pursued their careers, she with the Canadian Security Intelligence Service, where she was training to be an intelligence officer, and he with Fastlane Technologies Inc., marketing a network operating system that he had developed.

In March 1997, Vanasse took a leave of absence to move with Seguin to Halifax, to which Fastlane had relocated “for important business reasons,” the court said.

Over the next 3½ years, the couple had two children. Vanasse stayed home, while Seguin developed the company. They moved back to Ottawa in 1998. In September 2000, Fastlane was sold, netting Seguin about $11 million. The couple separated in 2005.

Writing for the court, Justice Thomas Cromwell ruled that not only were Vanasse and Seguin engaged in a joint family venture, but “there was a clear link between Vanasse’s contribution to it and the accumulation of wealth.

“The unjust enrichment is thus best viewed as Mr. Seguin leaving the relationship with a disproportionate share of the wealth accumulated as a result of their joint efforts.”

The court on Friday restored a lower court ruling — which had been overturned on appeal — that gave Vanasse half the value of the wealth Seguin accumulated during the 3½-year period when she was home looking after the children, enabling him to travel and devote more time to the company.

Stephen Grant, a Toronto family lawyer at McCarthy Tetrault, told the Globe and Mail that the rulings help move common-law relationships toward a more equal footing with marriages.

“As long as the property claimant can show a contribution to the asset or the growth of the assets, he or she will be entitled to share by way of a monetary award,” Mr. Grant told the Globe and Mail.

 

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