Occupation rent arises when the person who remains in the home is required to pay rent to the person who left the home to compensate the vacating party.
It is a particularly tricky area of family law and is often raised as a means to combat claims for post-separation adjustments sought to compensate a spouse for carrying costs.
It is important to note that occupation rent is not available to every person who moves out of his or her home after separation. A court has jurisdiction to order a party to pay occupation rent if it is reasonable and equitable to do so; such an Order is made at the discretion of the court.
If a Court wishes to make an Order for occupation rent under the Family Law Act, that Court must order exclusive possession of a home to one spouse before making an Order that the spouse in possession pay rent. Note: this claim is only available to married spouses.
Courts have held that an order for exclusive possession under s. 24(1)(c) of the Family Law Act should only be granted ‘cautiously and in exceptional circumstances.’ Within the family law context the following factors are to be taken into account:
- The conduct of the non-occupying spouse, such as the failure to pay support;
- The conduct of the occupying spouse, such as the failure to pay support;
- Which spouse paid the mortgage and other carrying charges of the home;
- Any delay in making the claim;
- The extent or impact the non-occupying spouse has faced as a result of having been prevented from accessing his or her equity in the home;
- Whether the non-occupying spouse moved for the sale of the home and, if not, why;
- Whether children resided with the occupying spouse and, if so, whether the non-occupying spouse paid, or was able to pay, child support; and
- Whether the occupying spouse has increased the selling value of the property.
One spouse asking or badgering the other to leave is not a factor considered in this analysis.
Courts may also make an Order for occupation rent as a common law remedy, which does not require the pre-requisite Order for exclusive possession. This branch of relief is available to married and unmarried spouses alike. The Court must consider the same factors regardless of which branch of law they are applying.