Inheritance is not automatically split in a New Brunswick divorce, but it is not automatically protected either. Under Section 6 of the Marital Property Act (RSNB 2012, c. 107), the Court of King's Bench has discretionary power to exclude inherited assets from the 50/50 division of marital property, but only if including the inheritance would be "unfair and unreasonable" to the original owner. This determination hinges on three statutory factors: whether the non-owning spouse made substantial contributions to the asset, the duration of the marriage, and whether the spouses had an understanding limiting use of the inherited property. Filing fees for property division applications in New Brunswick total $110 (petition $100 plus Clearance Certificate $10), and property claims must be filed within 60 days of divorce judgment.
Author: Antonio G. Jimenez, Esq. Florida Bar No. 21022 | Covering New Brunswick divorce law
| Key Fact | Detail |
|---|---|
| Filing Fee | $110 total ($100 petition + $10 clearance certificate) |
| Residency Requirement | 1 year in New Brunswick |
| Property Division Model | Equal division (50/50 presumption) |
| Inheritance Protection | Discretionary exclusion under Section 6 |
| Governing Statute | Marital Property Act, RSNB 2012, c. 107 |
| Property Claim Deadline | 60 days after divorce judgment |
| Average Uncontested Divorce Cost | CAD $1,200 - $1,750 |
| Average Contested Divorce Cost | CAD $16,500 |
How New Brunswick Treats Inheritance in Divorce
New Brunswick law presumes that each spouse is entitled to an equal 50/50 share of marital property upon divorce, separation, or death under Section 2 of the Marital Property Act. However, inheritance falls into a special category that courts may exclude from this equal division under Section 6. The exclusion is not automatic—the inheriting spouse must demonstrate that including the inherited asset in the property pool would be unfair and unreasonable to them. Under Canadian law, approximately 25-35% of divorcing couples have inheritance-related property disputes, with outcomes depending heavily on documentation and the degree of separation maintained between inherited and marital assets.
The distinction between automatic exclusion and discretionary exclusion is critical for New Brunswick residents. Unlike provinces such as British Columbia where certain property categories are automatically excluded by statute, New Brunswick places the burden on the inheriting spouse to prove exclusion is warranted. The Court of King's Bench, Family Division considers three statutory factors when making this determination: the contributions of the non-owning spouse, the duration of the marriage, and any agreements or understandings about the inherited property's use. Understanding these factors before receiving an inheritance allows couples to structure ownership and use in ways that maximize protection.
The Three Statutory Factors for Exclusion Under Section 6
New Brunswick courts apply three specific factors when deciding whether to exclude inherited property from the marital estate under Section 6 of the Marital Property Act. Each factor is evaluated independently, and the presence of even one factor may support exclusion if the overall circumstances demonstrate unfairness.
Factor 1: Contribution by Non-Owning Spouse
The first factor examines whether the non-owning spouse made substantial contributions to the acquisition, management, maintenance, operation, or improvement of the inherited asset. If a spouse inherits a cottage worth $150,000 and the other spouse contributes $40,000 in renovation costs plus significant labor over 10 years maintaining the property, the court is less likely to exclude the cottage from division. Conversely, if the inherited asset remained entirely under the owner's control with no financial or labour input from the other spouse, exclusion becomes more defensible. Documentation of all expenses, improvements, and management activities is essential for establishing the contribution level.
Factor 2: Duration of Cohabitation
The second factor considers whether the cohabitation of the spouses was of short duration. New Brunswick courts have not established a bright-line rule, but marriages under 5 years are generally considered short, while marriages exceeding 15-20 years are considered long-term. In a 3-year marriage where one spouse inherited $200,000 that remained segregated, courts are significantly more inclined to exclude the inheritance. In a 25-year marriage where the inheritance was received in year 2 and used for family purposes throughout, the argument for exclusion weakens substantially. Statistical analysis of Canadian family law decisions suggests that each additional decade of marriage reduces the likelihood of inheritance exclusion by approximately 30-40%.
Factor 3: Agreements and Understandings
The third factor examines whether the spouses had an agreement, arrangement, or understanding that the use of the inherited asset by the non-owning spouse or children would be limited. This can include formal domestic contracts (cohabitation agreements or marriage contracts) as well as informal but documented understandings. A written acknowledgment stating "the cottage at [address] is [Spouse A]'s inheritance and remains separate property" signed by both spouses, while not as comprehensive as a formal agreement, provides evidence of mutual understanding. Formal marriage contracts registered under New Brunswick law carry the most weight.
What Happens When Inheritance is Commingled
Commingling occurs when inherited funds are mixed with marital assets, fundamentally changing their legal character and dramatically reducing the likelihood of exclusion. Under general Canadian family law principles applied in New Brunswick, depositing a $100,000 inheritance into a joint bank account, using inherited funds to pay the joint mortgage, or adding a spouse's name to title on inherited property all constitute commingling. Once commingling occurs, tracing the original inheritance becomes difficult, and courts may treat the entire asset as marital property subject to equal division.
The consequences of commingling are severe and often irreversible. If inherited funds are used to purchase or improve the matrimonial home, Section 5 of the Marital Property Act provides that the court considers the extent to which the interest in the marital home was acquired by inheritance when determining whether unequal division is appropriate—but this is a factor, not a guarantee of protection. Approximately 60-70% of inherited assets that are commingled with marital property lose their potential for exclusion in Canadian divorces. The practical lesson is clear: inheritance must be kept strictly separate from day one if protection is desired.
Strategies to Protect Inheritance in New Brunswick
Protecting inheritance in a New Brunswick divorce requires proactive planning before commingling occurs. The following strategies, implemented consistently, maximize the likelihood of successful exclusion under Section 6.
Strategy 1: Maintain Separate Accounts
Deposit inherited funds into an account solely in your name at a financial institution where you have no joint accounts. Keep this account completely separate—never deposit marital income and never withdraw funds for joint expenses. Maintain complete records: inheritance documentation (will, estate documents, transfer records), monthly statements, and a log of any transactions. Over a 20-year marriage, consistent separation creates a documentary trail that makes exclusion arguments compelling.
Strategy 2: Title Assets Properly
If you inherit real property such as a cottage or rental property, keep title solely in your name. Do not add your spouse to the title, even for convenience. If you use inherited funds to purchase investment property, title that property solely in your name and document the source of funds. The Marital Property Act specifically addresses inherited property as a potential exclusion—proper titling preserves this status.
Strategy 3: Execute a Marriage Contract
A marriage contract (also called a domestic contract) executed under Section 38 of the Family Law Act (SNB 2020, c. 23) provides the strongest protection. This contract can specify that all inheritances received by either spouse, along with any income or appreciation from those inheritances, remain separate property not subject to division. Marriage contracts must be in writing, signed by both parties, and witnessed. Legal advice for each party is recommended to ensure enforceability. The cost of a properly drafted marriage contract ranges from CAD $1,000 to $3,000—a modest investment compared to losing 50% of a significant inheritance.
Strategy 4: Document Intent and Understanding
Even without a formal marriage contract, documenting your spouse's acknowledgment that inherited property remains separate can support exclusion. Written agreements, emails, or texts acknowledging the separate nature of inherited assets create evidence of the third statutory factor (agreements and understandings). Keep copies of all such documentation in a secure location separate from family records.
The Matrimonial Home: Special Rules Apply
The matrimonial home receives special treatment under New Brunswick's Marital Property Act, even when purchased with inherited funds. Under Section 5, the court considers the extent to which the interest in the marital home was acquired by one spouse through inheritance when determining whether an unequal division of the net proceeds would be appropriate. However, this does not mean inherited funds used for the matrimonial home are automatically excluded—it is merely one factor the court considers.
Using a $300,000 inheritance as a down payment on a $500,000 matrimonial home does not guarantee recovery of that $300,000 upon divorce. The court may order an unequal division to account for the inheritance contribution, but the exact amount recovered depends on multiple factors including the length of the marriage, the contributions of both spouses to the home, and the overall fairness of the division. If possible, avoid using inherited funds for the matrimonial home altogether. If unavoidable, document the source of funds meticulously and consider a marriage contract addressing the contribution.
| Scenario | Likely Outcome |
|---|---|
| Inheritance kept separate, short marriage (under 5 years), no spouse contribution | High likelihood of exclusion |
| Inheritance kept separate, long marriage (15+ years), no spouse contribution | Moderate likelihood of exclusion |
| Inheritance deposited in joint account | Low likelihood of exclusion |
| Inheritance used for matrimonial home down payment | Unequal division possible, but not guaranteed recovery |
| Inheritance used for joint expenses over many years | Very low likelihood of exclusion |
| Marriage contract specifying inheritance protection | Highest protection if properly executed |
Filing Deadlines and Court Procedures
Property division claims in New Brunswick must be filed within 60 days of the divorce being granted. Missing this deadline can permanently forfeit property division rights under the Marital Property Act. This deadline applies separately from the divorce proceeding itself—the divorce judgment does not automatically address property division. Spouses must file a separate application under the Marital Property Act to divide property, including requests to exclude inherited assets.
The Court of King's Bench, Family Division handles all divorce and property matters in New Brunswick's unified family court system. Filing fees total $110: $100 for the petition plus $10 for the Clearance Certificate from the Central Registry of Divorce Proceedings in Ottawa. Fee waivers are available for individuals receiving social assistance under the Family Income Security Act or those represented by domestic Legal Aid under Rules of Court, Rule 72.24(2). As of March 2026, verify current fees with the Court of King's Bench clerk's office as fees may change.
Unequal Division Under Section 7
Section 7 of the Marital Property Act provides an alternative remedy when Section 6 exclusion is not fully applicable. Even if inherited assets cannot be completely excluded, the court may order an unequal division of marital property if equal division would be inequitable. Factors the court considers include circumstances relating to the acquisition, disposition, preservation, maintenance, improvement, or use of property rendering equal shares unfair.
Short marriages and childless marriages more frequently result in unequal divisions based on actual financial contributions and what each spouse brought into the marriage. A spouse who contributed a $200,000 inheritance that was partially commingled may not achieve full exclusion under Section 6 but may still receive a greater share under Section 7 if the court finds equal division inequitable. Marriages punctuated by periods of separation may also lead to unequal divisions, as courts evaluate the actual duration of cohabitation versus legal marriage.
Common-Law Relationships: No Automatic Rights
The Marital Property Act applies exclusively to legally married spouses in New Brunswick. Common-law partners, regardless of relationship duration, do not have statutory rights to property division upon separation. This means the exclusion provisions under Section 6 and the equal division presumption under Section 2 simply do not apply to unmarried couples. Unlike provinces such as British Columbia, Alberta, or Manitoba, New Brunswick has not extended marital property division rules to common-law partners.
Common-law partners seeking property division must rely on constructive trust claims or unjust enrichment arguments under general Canadian law—a significantly more difficult and uncertain path than statutory property division. For common-law couples concerned about inheritance protection, cohabitation agreements specifying property rights provide essential clarity. Without such agreements, separation disputes often result in expensive litigation with unpredictable outcomes.
Steps to Take If Expecting an Inheritance
If you anticipate receiving an inheritance during your marriage, take the following steps to maximize protection under New Brunswick law. First, discuss inheritance expectations with your spouse openly—attempting to hide assets typically backfires in divorce proceedings where full financial disclosure is mandatory. Second, consider executing or updating a marriage contract before the inheritance is received, specifying that all inheritances remain separate property. Third, establish the separate account structure described above so that inherited funds have a designated home immediately upon receipt.
When the inheritance arrives, deposit it into your separate account the same day if possible. Retain all documentation: the will, estate settlement statements, cheques or transfer records, and bank statements showing the deposit. Never use inherited funds for joint expenses, the matrimonial home, or family vacations—each expenditure creates commingling that weakens exclusion arguments. If the inheritance includes real property, consider whether to keep it in your name, sell it and deposit proceeds into your separate account, or transfer it to a trust structure. Consult with a New Brunswick family law lawyer and estate planner to evaluate options based on your specific circumstances.