Property Division and Spousal Support in Alberta

When navigating a separation in Alberta, property should be divided prior to any final determination is made for spousal support. This is because, quite often, the property being divided can be used to make additional income, which affects the test for spousal support.

Spousal support in Alberta is determined first by examining whether a party is entitled or not.

After entitlement is found, the Court looks to how much should be paid and for how long. In determining a spousal support order, the Court is guided by s. 15.2 of the Divorce Act. Under that section, the Court must look at the parties’ means, needs and circumstances when making a support order.

Property is a highly relevant factor when looking at means, needs and circumstances.

Property can be used to make additional income, and the Court may even compel a party to use their property to earn income or impute that party with an income that includes hypothetical, realistic investment income if a party is not utilizing the family property appropriately. On the other side of the coin, if a party was forced to take on a substantial amount of debt to execute the property transfer, the Court may find that person does not need to pay support because the debt they incurred from the property division renders them unable to pay.

Also relevant are the parties’ respective standards of living.

If one spouse retains the family home with no mortgage, that party’s monthly expenses must account for that. If the family home is particularly nice and the other spouse is forced to rent or purchase a substantially worse home, that can also be taken into account. Similarly, if one party retains a family vehicle unencumbered and the other party is forced to purchase a vehicle with a loan, the loan payments may also be taken into account.

For the above reasons, a final spousal support order often cannot be determined until property is fully split.