By Daniella Gold

Working with divorcing clients can be both extremely challenging and extremely rewarding. With divorce rates expected to soar in the coming months, it is important to arm yourself with the knowledge you need to assist clients in working through the sale of their home under stressful circumstances.



At the outset, it is crucial for you to be aware that the law treats common-law partners and married partners very differently, particularly when it comes to the sale of the property they resided in at the time of their breakup.

When a couple is married legally, the house they reside in together, which is referred to by the Ontario legislation as a “matrimonial home,” receives special treatment under the law.  Both spouses have legally enforceable rights to the property regardless of who is on title, and therefore both spouses must sign the listing agreement and offers (an exception to this is when the sale is court ordered and the order states that one party can sell the property without the other’s consent).

When a couple is common law (in which case, the property they resided in together is not referred to as a “matrimonial home”) and only one partner is on title, the titled partner is the only one who needs to sign the contracts and offers. In these situations, you will not need to obtain the other partner’s consent. However, you will still encounter situations in which the parties are common law and both are on title, and in these cases, they will obviously both need to sign the contracts and offers.

Managing difficult dynamics

The first thing to consider when dealing with the sale of a matrimonial home (in the case of married couples) or a jointly owned home (in the case of separating common law partners) is why the house is being listed. There are a variety of answers to this question and each one will affect the strategy in dealing with your clients and the sale. The most common scenarios are:

  1. Neither party wants to continue to reside in the home because they both would like to move on. This is the easiest situation and most similar to the sale of any other home. The clients are co-operative and simply want the best price they can get for their home. Do a great job and hopefully at least one of the parties will want to purchase with you as well! This ideal situation is unfortunately the least common scenario.
  2. One party would like to stay but cannot afford to do so. The other party is willing to sell their share to their former spouse at fair market value but it is not financially feasible for them. This is a sad situation and the party who wants to stay will be struggling with the loss of the home in addition to the end of the relationship. Be compassionate by easing the sellers into the process and consulting them regularly during the listing process. In many cases they are feeling like their lives are out of control and they prefer to have a say in as much as possible.
  3. One party would like to stay in the home but the other party is forcing the sale and is unwilling to sell to their former spouse at any price. Someone is extremely hurt and getting back at their spouse is their only focus and concern. Sympathy and restraint are required here. Often there will be drama. The best way to deal with this scenario is to keep the conversations focused on the sale of the house and offer as much professional support as possible. Do not get involved in the details of the marital breakdown or the divorce process.
  4. Both parties would like to stay but neither is willing to sell their share of the home to the other party. This will be similar to option 3 but slightly more acrimonious. It should be handled similarly. This scenario would be the ideal one to include a collateral agreement in the listing paperwork.
  5. The sale has been court ordered. This is the trickiest scenario of all. Stay in touch with your client’s lawyer throughout this process, if possible. There is no such thing as documenting this transaction too much. Always ensure that you get a copy of the court order prior to listing and that it has all the necessary details and a proper stamp.
Bring your A-game

The ideal situation is being the listing agent for both parties because it allows you to control the situation more effectively. In this case there is usually better co-operation between the separating/divorcing couple and therefore more trust in you as the agent. After all, they have agreed to work with one single agent.

Present your listing presentation to both parties simultaneously. This can be done in person or virtually over Zoom or other similar technology.

Provide detailed information about the listing process and what is involved, including the preparation of the house for sale, the pros and cons of different marketing strategies, and how you will deal with offers together as a team.

Be confident of the value of the property. This is always important, but it is more critical than ever in this environment. Provide the sellers with values and be clear about the market conditions, the comparables and anything else that may be affecting their property value, whether these factors are within their control or not. Be prepared to answer any and all questions on this topic, as it is common for each of the parties to have their own opinion of what the house is worth, and the disparity can be huge depending on the situation.

If you are co-listing with another agent, things can get a little trickier. Sometimes it can be a blessing.

The most common reason for having two agents sell the matrimonial home is that the divorcing couple are unable to agree on one agent – usually because neither party trusts the other and therefore they can’t agree on an agent (and often on anything else).

Remember that even though one spouse has their own agent, you are both representing both sellers. Unfortunately, not all agents understand this concept and so it is your job to help them understand this and to get them on board so you can represent the sellers professionally and keep their interests at heart.

Most of the issues that come up when two agents are representing the couple relate to the following tasks, responsibilities and decisions:

  • Which brokerage will be the primary listing brokerage
  • Listing price
  • Signage
  • Marketing
  • Showings – times, who will be notified and how, who will confirm
  • Prepping the home
  • Staging
  • Real estate lawyer

As a general rule of thumb, if the parties cannot agree, it is best to follow this plan:

  • (a) The primary listing agent represents the party residing in the home
  • (b) The listing price is agreed to by the parties based on a consensus reached by both agents, who must get on the same page
  • (c) Marketing is done by both parties’ agents for a bigger reach
  • (d) Showing times are determined by the person residing in the home but must be reasonable
  • (e) All parties are notified of requested showings and whether they are approved or not
  • (f) Prepping the home and staging the home depends on a variety of factors to be negotiated based on what needs to be done
  • (g) The real estate lawyer is selected by the parties based on recommendations from the agents

Just as in the course of a normal sale, all parties must be kept in the loop regarding showings, feedback, offers and more.  Both sellers as well as both agents should be aware of everything – it is important that all parties are making decisions based on all of the information available. It is also important that both sellers feel they are getting the same information.

Dos and Don’ts

Do not get involved in the clients’ drama, stories and divorce process. This can be detrimental to all parties involved. It is your job to do what is best for the sellers – sell the home for the most money in the shortest amount of time. That is your job. Your job is not to judge the other party, make decisions based on one party’s needs over those of the other, or to share opinions on anything other than the real estate transaction.

Be sympathetic – after all, this is a terrible time for your clients in most cases, whether they wanted to end the relationship or not. However, do not get emotionally involved as it may cause you to make poor decisions that negatively affect your clients. Be impartial and help them achieve their ultimate goal.

And finally, put everything in writing – for your sake and for your clients’ sakes.

We all take notes and keep files on our clients, but the amount of detail that is required on these files is exceptional. Anything that you put in writing can be shared, so be mindful of that as well. Send the party you represent an email and it may end up in an affidavit down the line. Think before you hit send! Staying professional and neutral will make this easier.

Some of these sales can be extremely challenging and will require you to use skills and resources that aren’t required in other transactions. I hope that these tips will help bolster your confidence in these situations.

Daniella Gold is an award winning Realtor at Harvey Kalles Real Estate, a real estate negotiation expert and partner at RDK Divorce Group. As a specialist in divorce real estate, she is intimately familiar with the unique emotional and legal complexities of these transactions and has a special passion for assisting families during such a challenging time in their lives.

4 COMMENTS

  1. Great read!
    At Tembo Financial we work closely with our divorced clients and follow similar protocol. Making sure that we are sympathetic and understanding during this difficult time is important to us. Splitting from the matrimonial home is hard on both parties involved, and it is great to see REM supporting and understanding the needs of the client!

  2. •Getting Divorced? – a list of a 50 questions you need to consider
    (and – Should you Sell the house? or Buy out your spouse)

    http://www.carolyne.com/divorce.html

    ===

    • Gift Money, Homes and Divorce
    (Was It a Gift or a Loan?)

    http://www.carolyne.com/gift.html

    ===

    My articles on this topic have been read by people all over the world for decades, who sent thank you emails expressing their gratitude. I even had email from Ireland. The articles became great networking tools, often appearing in searching the word divorce, in the number one spot online. Even some BOR offices and law offices in Canada and in the States reprinted the links on their own sites keeping my copyright protected.

    At the time of writing, decades ago, no one had publicized these discussions, so the information I wrote was an anomaly back then. Then the Internet appeared, and my copy went live. I had originally put the information in my client newsletters.

    The feedback was immediate. And the results when divorcing clients contacted me netted me many subject sensitive referrals and testimonials.

    And I repeat: There are no answers. Only questions – that trigger discussions. But some of the questions are ones sometimes that have never been thought about let alone discussed. My material opened doors to handle the related topics in a most sensitive manner possible.

    Divorcing clients definitely need to choose an agent who is sensitive to the privacy factor and unspoken needs and requirements; and even needing to care about the needs of extended family involvement who need distancing rules implemented.

    This is a very sophisticated and special market arena and not one that every agent is suited for, personality-wise.

    Carolyne L 🍁

    • It seems like forever ago that when homeowners were going through a divorce and one of the owners remained in the mat-home, in particular the wife of the day, she often contacted the hydro electric supply company, the gas or oil company heat supply, and the alarm company – all utilities, seeking to put the then postal mailed invoices into just her name, since the husband didn’t live there anymore and the wife paid the property utilities bills. Each request was rejected and she was outrightly forbidden to do so. Told: it’s the law. Today it might even be deemed racism by some women.

      Had the spouse died, she would have been required to provide a death certificate proof and even then some utilities said the account billing name would not / could not be changed, creating additional stress for the wife.

      This brings up the topic of properties held in several names as owners. Who is deemed the dominant owner… when the lawyer registers at LRO (as LRO really doesn’t care if there is a dominant owner?). And begs the question how the same topic is covered under property rights in commercial real estate, with of course the billings being in the corporate name, but what if the business is sole ownership not incorporated.

      I just learned from an old neighbour who is currently going through a divorce that she experienced the same denial. The utilities simply refused to put their billings into just her name, including her satellite provider who insisted her (ex) husband still had control of her cell phone billing as it was part of the mat-home tv service package, a giant in the industry. She had to go to a different service provider. As is often the case, she got fed up and was currently told the only way out was to sell the mat-home.

      Can someone address exactly what segment of family law or common law gives the utilities companies the apparently legal right to deny the sole ‘woman’ owner in the midst of divorce to have the utilities account billing departments to refuse the wife’s request to put the accounts in just her name.

      It sounds like shades of prior to 1972/3 in Canada when the wife was still deemed to be property of her husband under the then Family Law Act, in Canada, and she could not borrow money in just her own name, (or buy property in just her own name) let’s say to start her own business as an example using her own-earned money of the day – her husband had to sign his “authority” at any bank or financial institution to enable her to borrow, yes, this is Canada, and until the Family Law Act became the Family Law Reform Act was passed that’s how it always had been. No one had ever questioned the law until then.

      But when that law changed it seems the utilities companies were not part of the transition. So here we are five decades later where wives are still having this literal fight on their hands.

      Even when utilities accounts were set up initially on a given property in joint ownership not as tenants in common the utilities bills were always put in only the husband’s name (never both names), and could only be changed on death or divorce completion certificates being provided or proof of change of ownership by sale or transfer of the subject mat-home property.

      A case in point is the in recent years (being maybe the late 1980s), sometimes common practice that furnace replacement needed became a rental furnace. Tied to the utility company billing only in the husband’s name, it allegedly often became the responsibility of the husband to buy out that rental contract that might have years to run still. Unless, of course the divorce negotiations accounted for that rental buyout cost to be shared in some manner.

      Some divorces take years in the courts to finalize. In the meantime the wife’s supposed rights are diminished and her credit rating even affected. The old laws apparently still apply; no different at the time, doctors had to apply to Ottawa to get permission in 1963, to prescribe birth control pills for a married woman. And had to require her husband’s permission signature; her body belonged to her husband.

      Question: in today’s world with same sex marriages, relative to property rights, who does the utilities companies deem to be the dominant spouse? for billing purposes in such marriages. Just one more quagmire for lawyers to deal with.

      Difficult even in an amenable split, one more difficult in a contested divorce, in the interim, adding to spousal stress. Only answer seems to be: sell the house, sometimes inflicting stress on children having to change schools, and in all the related disruption giving up what they mistakenly thought was “their” home. There’s so much more to divorce but this topic of how utilities billings are addressed seems to add insult to injury.

      And then there’s the question of common law relationship (marriages) relative to utilities billings and related responsibilities at a breakup or breakdown.

      Carolyne L 🍁

Leave a Reply