“The trial judge recognized that Kerr v. Baranow was decided within the context of common-law relationships. He also knew that, in the present case, the parties had been married. Nonetheless, he understood that this court’s decision in Martin v. Sansome, 2014 ONCA 14 (CanLII), 118 O.R. (3d) 522, mandates that such an approach be followed for married couples, as well as those in common-law relationships. At para. 44 of his reasons, the trial judge states, “the first step must be the determination of whether or not the elements of a joint family venture exist and then determine whether or not there is fair compensation after reviewing the calculations in accordance with the scheme set out in the FLA for equalization of property.”
In my view, the trial judge erred by beginning his analysis with the question of joint family venture. He should simply have had recourse to the FLA. This court’s decision in Martin does not suggest otherwise.
In Martin, the trial judge concluded that the farm business was a joint family venture and awarded the wife a constructive trust interest in it. This court set aside the trial judge’s determination and replaced it with a calculation of the wife’s entitlement under the equalization provisions of the FLA.
At para. 63 of Martin, Hoy A.C.J.O., writing for the court, explains that s. 5(7) of the FLA makes it clear that the express purpose of the FLA equalization provisions is to address the unjust enrichment that would otherwise arise on marriage breakdown.
She then refers to para. 66 of McNamee v. McNamee, 2011 ONCA 533 (CanLII), 106 O.R. (3d) 401, in which this court stated that, “in the vast majority of cases, any unjust enrichment that arises as the result of a marriage will be fully addressed through the operation of the equalization provisions under the [FLA]”.
At para. 66 of Martin, Hoy A.C.J.O. concludes,
if unjust enrichment as the result of a marriage has been found, and it has been determined that monetary damages can suffice, the aggrieved party’s entitlement under the equalization provisions of the FLA should first be calculated.
For these reasons, it was an error for the trial judge to begin his analysis by considering the possible existence of a joint family venture. For married couples, application of the FLA equalization provisions is the starting point for addressing inequities arising from marriage breakdown.”