Stopping a Spouse From Selling or Mortgaging Property During Separation

When a relationship ends, one of the first worries is often practical: what stops my spouse from selling the house, refinancing it, or moving money before we have sorted out who gets what? The worry is sharper if the title is in your spouse's name alone.

BC law gives you several ways to put a hold on property during separation. They work differently, they cover different kinds of property, and timing matters. Here is how each one works.

Your rights and the title register are two different things

Under section 81 of the Family Law Act, on separation each spouse has a right to an undivided half interest in all family property as a tenant in common, subject to any agreement or order and the exceptions in the Act. That right exists whether or not your name is on title.

The problem is that the right does not appear on the title register by itself. A buyer or a mortgage lender looks at the register. If your spouse is the only registered owner and nothing else is noted on title, the register gives a buyer or lender no warning of your claim. Your claim against your spouse would remain, but recovering your share after the property or the equity is gone is harder and slower.

The tools below close that gap. For the bigger picture of what counts as family property, see our guide to family property division in BC.

A homestead entry under the Land (Spouse Protection) Act

This is a lesser-known tool, and it does not require a court case. A spouse can apply to the land title office for an entry on the title of a "homestead": land registered in the other spouse's name with a dwelling that the spouses occupy as their residence, or have occupied within the year before the application. "Spouse" includes married spouses and people who have lived in a marriage-like relationship for at least two years. The applicant must live in BC and be 19 or older.

Once the entry is made, section 3 of the Act makes a disposition of the homestead without your written consent void. "Disposition" is defined to include a transfer, a lease and a mortgage, so it covers refinancing as well as a sale.

The limits matter:

• It protects the family residence only. It does not cover a rental property, a cabin you did not live in, bank accounts or investments.
• It ends when the property issue is resolved. The Act stops applying once the spouses have separated and resolved ownership or division of the homestead by an agreement or order under the Family Law Act.
• Forms and evidence. The application must be in the prescribed form with a supporting affidavit, so it is worth having it prepared carefully.

A certificate of pending litigation

If a family law case is already under way, section 215(6) of the Land Title Act allows a party to a proceeding for a Family Law Act order dividing property to register a certificate of pending litigation (CPL) against any interest in land whose title could change as a result of the case. In practice, that means you first start a family claim in the BC Supreme Court that asks for property division, and then register the CPL against the property.

Under section 216, once a CPL is registered the registrar must not make entries that charge or transfer the land until the CPL is cancelled, with some exceptions, such as registrations expressly made subject to the outcome of the case. Buyers and lenders generally will not proceed with a CPL on title, so it is an effective hold. A CPL can cover a home, a rental property or other land, whether or not you lived there.

It is not absolute. Under sections 256 and 257, the owner can apply to cancel the CPL on grounds of hardship, and the court may cancel it if damages would adequately protect you and the owner posts security. A CPL also needs a genuine claim behind it, so register one only on advice.

Court orders that protect property of any kind

Section 91 of the Family Law Act is the broadest tool, and it is not limited to land. On application by a spouse, the Supreme Court must restrain the other spouse from disposing of property at issue unless that spouse shows your claim will not be defeated or harmed. In other words, once you apply, the burden is on the spouse who wants to deal with the property.

The court can also order:

• Preservation. Possession, delivery, safekeeping and preservation of property.
• No transfers or conversions. An order stopping your spouse from disposing of, transferring or converting property in which you may have an interest, which can reach bank and investment accounts, vehicles and business interests.
• Vesting. An order vesting all or part of the property in you, or in trust for you.

In an urgent case, the court can make a section 91 order before your spouse is served with the application. If money has already started to move, our articles on a spouse who drained a joint account and a spouse hiding assets explain the next steps. If the dispute is about who lives in the home, section 90 allows exclusive occupancy orders.

Refinancing and lines of credit

Title-based tools, the homestead entry and the CPL, work by stopping new registrations such as a new mortgage. They may not stop your spouse drawing more on a secured line of credit that is already registered. If that is a risk, a section 91 order directed at your spouse is often the practical answer, alongside notice to the lender once an order is in place.

What to do this week

• Search the title. Confirm who the registered owner is and what mortgages or lines of credit are already registered.
• Gather records. Recent mortgage, bank and investment statements help show what is at risk.
• Act before a listing or refinance. Once a sale completes or new money is advanced, protection becomes much harder to get.
• Keep the time limits in mind. Property claims are subject to deadlines; see our guide to family law deadlines in BC.

Worried your spouse will sell or refinance before you settle?

Our family lawyers can check the title, advise which protection fits your property and your timeline, and prepare the homestead entry, family claim, certificate of pending litigation or court application you need.

Call 604-259-2844 or send us a message to arrange a consultation at our Vancouver office.