In Toronto, when we talk about “premarital property,” most people think of property division in divorce. But a more significant, yet often overlooked, risk is: what happens to these premarital assets if one spouse unfortunately passes away?

Many people mistakenly believe: “This is a house/stock I bought before my marriage, and I’ve made a will for my children, so everything is safe.”

The truth is: in Ontario, this assumption may be completely wrong.

When one spouse dies, a complex legal process is initiated, combining the Family Law and the Inheritance Reform Act. If you don’t plan ahead, your hard-earned premarital assets, and even the “marital home” you hope to leave to your children from the previous relationship, may face the risk of being redistributed.

The biggest misconception: Is a will everything?

In Ontario, when the spouse who owns the assets dies, the surviving spouse faces a significant legal choice:

Option A: Acceptance of the will (or intestate succession) means inheriting the estate according to the contents of the deceased spouse’s will (or the statutory order of succession in the absence of a will).

Option B: Reject the will and instead apply for “equalization” under the Family Law. The surviving spouse can choose not to accept the arrangements of the will and instead, like in a “divorce,” request an equal division of the “net family property” accumulated by both parties during the marriage.

The core risks of "premarital property" at the time of death

This “Option B” is where the risk lies.

  1. The “appreciation” portion of premarital assets is involved: While the original value of your premarital property can be deducted in the calculation, all its appreciation during the entire marriage (for example, your portfolio growing from $500,000 to $2 million) will be considered marital property and used for “equal division”.
  2. The most dangerous trap: “Matrimonial Home” – This is the most critical blind spot! According to Ontario’s Family Law, regardless of who purchased the property before marriage or whose name is on the title deed, once it becomes your “marital home,” it loses its protection as premarital property in the “property division” calculation.
    • For example, Mr. Zhang purchased a condo in full before his marriage. After remarrying, this condo became his and his new wife’s “marital home.” Mr. Zhang’s will clearly stated that after his death, this condo would be left to his son with his ex-wife.
    • Legal reality: After Mr. Zhang’s death, if his new wife discovers that the share granted to her in the will is less than what would be considered an equal division of assets, she has the right to choose option B. In this case, the entire value of the condo (not just its post-marital appreciation) will be included in the deceased spouse’s assets for equal division.
    • Result: Mr. Zhang’s wish to leave the property intact to his son may be completely thwarted. His son may be forced to sell the house to pay the difference between the original and the “equal” share to his stepmother.

Solution: How can JZW Law protect your rights?

A will alone is insufficient to protect your premarital assets and the interests of specific heirs. You need a more powerful legal tool—a prenuptial agreement or a marriage contract.

At JZW Law, we specialize in the intersection of family law and estate planning. We know how to build the strongest legal defense for you. A carefully drafted Marital Agreement from JZW Law can do just that:

  1. Explicitly relinquish the “right to equal division of property”: We can draft a clause stipulating that both parties agree to relinquish their right to equal division of property under the Family Law, whether in the event of divorce or the death of one party.
  2. Locking in the ownership of “marital home”: The agreement can clearly stipulate that the value and ownership of a specific property (even if it is marital home) will not be governed by the property division rules of the Family Law after the death of one party, but will be strictly executed in accordance with the will.
  3. Protect your premarital assets and businesses: Clearly define which assets (including your company shares, investments, RRSPs, etc.) belong to your separate property, ensuring that their appreciation will not be used for division after your death.
  4. Ensuring the effective execution of your will: Your “marriage agreement” works in tandem with your “will.” The agreement eliminates interference from family law, ensuring your will is executed strictly according to your true wishes.

JZW Law Firm: Your Family Wealth Guardians

In Toronto, handling estate matters involving remarried families, premarital assets, and business equity requires a high level of expertise and experience. JZW Law Firm excels in the following areas:

  • Dual Expertise: We have a deep understanding of the complex intersection between Family Law (property division) and Inheritance Law (estate distribution), enabling us to anticipate and avoid potential legal conflicts.
  • Strategic Planning: We don’t just fill out templates. We will tailor a protection plan for you based on your family structure (especially for blended families) and asset composition.
  • Clear Communication: We will explain complex legal provisions to you in the clearest language possible, ensuring that you make decisions with full knowledge.

Don’t wait until an accident happens to find that your last wishes cannot be fulfilled. Protecting your premarital assets and securing your children’s future is the wisest decision you can make right now.

JZW Law Firm boasts a team of experienced lawyers fluent in both Chinese and English, providing professional legal services. We specialize in handling complex issues related to property division, corporate equity, trusts, and overseas assets. We offer initial consultations; please contact us for more information or to schedule a consultation.

Disclaimer: This article is for informational purposes only and does not constitute legal advice. If you require legal assistance, please consult a professional lawyer.