As was reported in a recent article in the Financial Post reported, the decision in a case called O’Brien v. O’Brien tackled the intriguing question of whether a spouse who stays behind in the matrimonial home after separation must pay “occupation rent” to the other spouse who has moved out pending their mutual divorce trial.
In this case, that divorce trial took place a full seven years after the separation, and it was the husband who continued to live in the jointly-held matrimonial home after separating from the wife. Neither of them took steps to finalize the property-equalization process, and the home increased significantly in value during that time. The husband also made some mortgage payments.
The husband continued to live the home, paid all the expenses, did renovations, and paid down some of the mortgage. He claimed against the wife for her share of the maintenance and improvement costs, and the wife countered with a claim for occupation rent against the husband. She claimed that he owed her $1,800 per month for approximately the past seven years, totalling about $78,000, and gave him notice of that claim only shortly before their divorce trial.
The court, in considering whether the husband was obliged to pay the wife a fair amount for the rent that he would otherwise be paying elsewhere, articulated some of the legal principles that must be factored in, namely:
- The timing of the wife’s claim for occupation rent;
- The duration of the husband’s occupancy;
- The wife’s inability to realize on her equity in the property;
- Any reasonable credits to be set off against the occupation rent potentially payable by the husband; and
- Any other competing claims in the litigation.
Drawing from prior case precedent, the court listed some added factors that also needed assessment, specifically:
- The wife’s conduct, including any failure to pay support (if previously ordered to do so);
- The husband’s conduct, including any failure to pay support (if ordered);
- Any delay by the wife in making her claim for occupation rent;
- The extent to which the wife has been prevented from having access to her equity in the home;
- Whether the wife moved out of the home so that it could be sold;
- Whether the husband paid the mortgage and other carrying charges of the home;
- Whether their children resided with the husband and whether the wife paid child support; and
- Whether the husband increased the selling value of the property.
The court noted that the burden is on the wife in this case to satisfy the court that these factors are established – in whatever combination, and to the needed degree. Also, it was up to the wife to provide specific evidence as to what the market value of the home would have been.
After reviewing all these components against the facts of this case – and despite the fact that the husband had in the former matrimonial home for more than 7 years pending trial – the court found that he did not owe the wife any occupation rent here. Conversely, and in light of that conclusion, the husband was ineligible to make a claim against the wife for home maintenance and improvements, because he did that work for himself as an “occupier” of the home.
For the full text of the decisions, see:
At Russell Alexander, Family Lawyers our focus is exclusively family law, offering pre-separation legal advice and assisting clients with family related issues including: custody and access, separation agreements, child and spousal support, division of family property, paternity disputes, and enforcement of court orders. For more information, visit us at RussellAlexander.com