What happens to family property when spouses separate?

How property is divided

In B.C., the rules about the division of family property apply to both married couples and unmarried couples who have been living together in a marriage-like relationship for at least two years.

There are two categories of property:

• Family property
• Excluded property

Family property is everything that you or your spouse own separately or together on the date you separate. It does not matter whose name the family property is in.

Family property includes:

• The family home
• RRSPs
• Investments
• Bank accounts
• Insurance policies
• Pensions
• An interest in a business
• The amount of any increase in the value of excluded property (see below) since the relationship started

When spouses separate, all family property is shared equally, unless the couple has an agreement that says something else or it would be significantly unfair to divide it equally.

Some things are not considered family property. They are excluded from the rule that the property must be divided equally.

Excluded property includes:

• Property one spouse owned before the relationship started
• Gifts and inheritances given to one spouse during the relationship
• Some types of damage awards, insurance proceeds and trust property

But if the value of excluded property has increased during the relationship, that increase in value is considered family property and is divided equally.

For example, suppose you owned a house worth $300,000 when your spouse moved in. Together, you paid the mortgage, did renovations and then the housing market went up. As a result, when you separated, the value of the house had increased to $500,000. You would keep the original $300,000 and you and your spouse would share the extra $200,000 of the increased equity.

If a couple wishes to divide their property or debt differently, they can make an agreement.

Most of the time, excluded property cannot be divided at all. But in very limited cases, such as long interdependent relationships or where family property is located outside B.C. and cannot be easily divided, excluded property could be divided to make sure each spouse gets a fair outcome.

When property can be divided unequally

A court will divide family property or debt unequally only if it would be “significantly unfair” to divide it equally. This means that a court will not order an unequal division in most cases. The court can look at a number of factors when deciding whether to divide property or debt unequally.

As well, a couple can divide their property or debt unequally by making an agreement.

Companion Animals

A companion animal is a unique type of property, and may either be family property or excluded property. Specific factors must be considered to decide who will keep a companion animal after spouses separate. Spouses can make an agreement to jointly own or share possession of the companion animal. It is also possible for the court to order that one spouse has sole ownership or sole possession of the companion animal.

More information

For more information about what happens to property, please visit:

• Dividing family property and debts on the Family Law in British Columbia website
• Dividing Family Assets in the Family Law section of Dial-A-Law
• Information Guide: Family Law and Companion Animals in B.C. (PDF, 1.2MB)