What does “Equalization” mean in Family property division in Alberta?
Equalization in the context of family property division in Alberta refers to the process of ensuring a fair and equitable distribution of marital assets during a divorce or separation. This concept is crucial in family law as it seeks to balance the economic impacts of a relationship breakdown, particularly when the financial contributions of the partners have been unequal. Here’s a detailed look at how equalization works in Alberta:
Understanding Marital Property in Alberta
In Alberta, the property acquired during a marriage or adult interdependent partnership is typically considered marital property. This includes assets such as real estate, investments, business interests, and pensions. Each partner may also have personal property that was owned before the relationship or received as a gift or inheritance.
Legislative Framework Regarding Property Division in Alberta
The process of property division is governed by the Family Property Act in Alberta. This Act provides guidelines on how marital assets and debts should be divided when a relationship ends.
The Equalization Process in Alberta
Equalization aims to divide the total value of the marital assets equally. To achieve this, the total value of all marital assets is first calculated. Debts are then deducted to determine the net marital property. The goal is to ensure that each partner leaves the marriage with an equal share of the net marital property.
Exceptions and Considerations
The law recognizes that equal division may not always be equitable. For example, assets brought into the marriage, inheritances, or gifts may be treated differently. Factors like the length of the marriage, the roles of each partner during the marriage, and future financial prospects may also influence the division.
Pensions and Retirement Benefits in Alberta
In Alberta, pensions and retirement benefits are considered marital property and are subject to equalization. Special rules apply to the valuation and division of these assets.
Property Valuation in Alberta
Accurate valuation of assets is critical in the equalization process. This may require professional appraisals, particularly for complex assets like businesses or investments.
Negotiation and Settlement in Alberta
Couples are encouraged to reach an agreement on the division of property through negotiation or mediation. If an agreement cannot be reached, the matter may go to court where a judge will decide based on the principles of the Family Property Act.
Implementation of Equalization Payments in Alberta
The actual division of assets may involve one partner buying out the other’s share, selling assets and dividing the proceeds, or a combination of both. In some cases, equalization payments are made over time.
Tax Implications in Alberta
There are potential tax implications in the division of property, particularly with respect to capital gains. Professional tax advice is often necessary to understand and mitigate these impacts.
Legal Representation in Alberta
Given the complexities involved, legal representation is crucial in navigating the equalization process. A family law attorney can provide advice, represent a client’s interests in negotiations or court, and help ensure a fair settlement.
Equalization in family property division is a nuanced process in Alberta, requiring a careful consideration of various legal, financial, and personal factors to ensure an equitable outcome for both parties.
Author: Calgary Divorce and Separation Lawyer – LUCY DIALE MEWANU
