Remmem v. Remmem Case Brief: Excluded PropertyRemmem v. Remmem, 2014 BCSC 1552 (CanLII)
Remmem v. Remmem: Excluded Property
This summary only focuses on the asset division. There was several other issues that are not addressed in this summary.
Style of Cause:
Remmem v. Remmem, 2014 BCSC 1552
This is a case brought to the Supreme Court of British Columbia in Vancouver.
Neil Remmem is the claimant and Lori Remmem is the respondent. They started living together in October of 1990 and were married on April 21, 1991. Before relationship begin Mr. Remmem owned a Class A license attached to the vessel M.V. Chaser and he operated the Chaser Seafood Inc.
Mr. Remmem owned a property on Greaves Road which he purchased in December 1985 before relationship began. Later he purchased a trailer which he situated on the property. When they began the relationship, Ms. Remmem moved into the trailer and the couple lived there for a number of years. Greaves Road property was sold in 1995 and the proceeds of sale was used to purchase the Middle Point Road home under both Mr. and Mrs. Remmem names.
1) When dividing family property between the parties, should $100,000, the value of the M.V. Chaser in October 1990, be excluded so that Mr. Remmem receives full credit or value for that property? 2) When dividing family property between the parties, should $65,000, the value of the Greaves Road property in October 1990, be excluded or should a lesser amount be excluded because Mr. Remmem gifted half of the proceeds from that property to Ms. Remmem when Middle Point was purchased jointly?
The vessel M.V. Chaser was brought into the relationship and therefore is not a family property and rather an excluded property. Tracing indicates that the Middle Point Road property was purchased with the proceeds of the sale of Greaves Road property which was brought into the relationship, therefore that property is an excluded property as well.
Property brought into a relationship, and any property acquired after relationship begin using the proceeds from the sale of the one brought into the relationship is an “excluded property”. If that property increases in value then the increase would be family property but the decrease has no effect on the apportionment of assets.
There are two types of property in British Columbia under the FLA: Family property which is shared equally in most cases; and, excluded property which is not shared equally. Section 85 excludes from the definition of family property, any property acquired by a spouse before a relationship began. Accordingly, any such property is not family property and the other spouse has no right to an undivided half interest in that property as a tenant in common. If that property increases in value then the increase would be family property pursuant to s. 84(2)(g). However, if it does not, pursuant to s. 96, the court has no discretion to order a division of that property.
In the present case, this means the M.V. Chaser is not and never was family property, and the $100,000 value of the vessel in October 1990 cannot be brought into the equation to apply against other family property.
A spouse claiming that property is excluded property is responsible for demonstrating that the property is excluded property. Middle Point property placed in joint names is clearly derived from excluded property and so it is easy to trace the full amount of the exclusion. Unlike the presumption of advancement, tracing does not depend on the parties’ intentions. The application of the presumption of advancement and an examination of whether property was gifted is at odds with the simple concept of tracing. When applied, the presumption of advancement would significantly reduce the value of the exclusion to the donor spouse. This was one of the very first cases to talk about excluded property and that is why it’s important.