When you’re going through a separation or divorce, dividing assets between yourself and your former spouse can be stressful. In the modern world, not only must you divide traditional assets you acquired during your marriage (such as real estate, vehicles, or bank accounts), but also digital assets. Although this can get complicated, the Family Property Act in Alberta governs property division, including digital assets, to ensure fair distribution between spouses.
Understanding how digital assets are defined, valued, and divided in Alberta can help you navigate your divorce with more confidence. Whether you, your spouse, or you both own digital assets, our Edmonton divorce lawyers at Verhaeghe Law can assist. To discuss your situation, schedule a consultation with our legal team today.
What Are Considered Digital Assets?
There are many forms which a digital asset can take. In general, an asset is any form of property which holds value or increases the value of the owner. Under Alberta law, digital assets must be fully disclosed at the point of divorce so that they can be valued and divided appropriately.
Common types of digital assets in Alberta and across Canada include:
- Bitcoin and other cryptocurrencies
- NFTs (non-fungible tokens)
- Digital media and entertainment collections
- Social media accounts
- Online businesses
- Online shop accounts (Etsy, Amazon, or Shopify)
- Customer loyalty programs
- Points, travel points, and credit card rewards
- And more
In many cases, digital assets might be tied to personal accounts or passwords. As a result, collecting, documenting, and valuing them can get complicated. By working with an experienced family lawyer, you can make sure all of your digital assets and their value are accounted for during your divorce.
Understanding the Family Property Act and the Division of Digital Assets
In Alberta, property division between spouses is carried out via the equalization of their Net Family Property (NFP). During this process, each spouse must disclose all of their assets (including digital assets), so they can be valued. The total value of each spouse’s assets is calculated by deducting their total debts and liabilities. Generally, the spouse with the higher NFP will need to make an equalization payment to the spouse with the lower NFP to facilitate an equitable distribution of assets.
According to Alberta law, matrimonial property that must be disclosed includes any assets or debts each party has accrued during the marriage whether in individual names, joint names, or company names. Certain assets may be excluded from equalization, such as property acquired before marriage, gifts, inheritances, and more.
So, what happens to your digital assets when you get a divorce?
Under the Family Property Act, digital assets are considered matrimonial property and are treated like any other property during divorce. As a result, equal division of digital assets is presumed unless an alternative arrangement is agreed to by spouses.
There are a few options for property division available to you and your spouse, depending on your situation. You may decide to pursue a:
- Separation Agreement: Spouses are entitled to negotiate between themselves. If they can mutually agree on how to divide their assets (including digital assets) without court intervention, they may split their property however they deem fit.
- Court-Ordered Division: If you and your spouse cannot reach an agreement, you will need to file a Statement of Claim for a matrimonial property action at the Court of King’s Bench. Here, the court will decide on an equitable division of your assets, including your digital assets.
Going Through a Divorce With Digital Assets? Contact Our Family Lawyers Today
Digital assets are an evolving part of property division in Alberta divorces. Courts treat them similarly to traditional assets, with options for equitable distribution through agreements or court orders. To understand how the Family Property Act will affect your digital assets, you should work with an experienced divorce lawyer.
At Verhaeghe Law, our family lawyers are well versed in laws of property division within the province. We can help you navigate your divorce seamlessly. To discuss your legal options, schedule a consultation today.