The presence of ongoing sexual relations while living together is a strong factor favouring a finding of continued cohabitation, which would then result in a later valuation date

Epstein’s This Week in Family Law

Philip Epstein

Determining Valuation Date

Tokaji v. Tokaji, 2016 CarswellOnt 20010 (Ont. S.C.J.) - T.A. Heeney R.S.J. In virtually all provinces it is necessary to determine the valuation date for the purposes of determining the equalization of the party’s net family property or the division of property.

Those provinces that use the valuation date standard definition, such as the Ontario courts, determine the date that the parties separated and there is no reasonable prospect that they will resume cohabitation. It is a conjunctive test as pointed out in Rosseter v. Rosseter, 38 R.F.L. (7th) 339 (Ont. S.C.J.), and parties who are not cohabiting are, therefore, separated. Cohabit is defined in the Ontario Family Law Act as living together in a conjugal relationship whether within or outside marriage. Determining whether parties are cohabiting or separated requires a careful factual analysis.

Here, I think the parties wisely agreed to bifurcate the issue of the valuation date. They determined the issue in a one-day proceeding before the trial judge. The parties had a three-year difference on valuation date, but it is clear from reviewing the wife’s evidence which the trial judge was more inclined to accept, that she had chosen the later and correct valuation date. Justice Heeney reviews the leading cases on this issue being Greaves v. Greaves, 4 R.F.L. (6th) 1 (Ont. S.C.J.) and Oswell v. Oswell, 28 R.F.L. (3d) 10 (Ont. H.C.). Applying the factors set out in this case, there was no real physical separation of these parties until about July, 2014. They had continued to share the same bed at least one week a month, they had sexual relations from time to time, prepared meals and were interrelated financially. Justice Heeney took some comfort in the fact that the parties identified themselves for the purposes of income tax as being married. How parties treat their income tax return has been repeatedly held to be a relevant factor in determining whether parties are separated. Justice Heeney says this about sexual relations as it relates to separation:

It has been held that the absence of sexual relations is not conclusive. In my view, however, where there is the presence of ongoing sexual relations, even as infrequent as one every couple of months, while the parties are physically living together, that is a strong factor in favour of a finding that the parties are cohabiting.

Bifurcating the issue of the valuation date is an economical use of the Court’s resources. The parties could not settle this case easily without a determination of the valuation date because it had a significant impact on the equalization payment. Sometimes a valuation date differs by a few months and will make no difference. But often a difference of years could make a significant difference. As Justice Heeney notes in this case, determining the valuation date will facilitate settlement and far better for the court to spend a day determining the valuation date than to spend two weeks on a trial with conflicting dates.

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