There is a position that has quietly become routine in Ontario family litigation. A married spouse seeks, primarily, an equalization of net family property, and then advances a second, freestanding claim in unjust enrichment, usually framed as a joint family venture, seeking a share of the growth of an asset that rose after the separation date.
The appeal of the claim is obvious. Equalization under the Family Law Act is a snapshot. It measures the accretion of family wealth between the date of marriage and the date of separation (aka the valuation date), and then it stops. Everything the asset earns after that date belongs, on the face of the statute, to the titled owner alone. In a market where a property can gain six figures between separation and subsequent sale, the spouse without title watches that gain accrue entirely to the other side and looks for a doctrine that will reach it. Unjust enrichment is the doctrine most often reached for.
The case of Schmutz v. Schmutz 2026 ONSC 2024 (CanLII) https://canlii.ca/t/kk8wr is a careful reminder of why it usually does not work.
In this case, Susan and Christian Schmutz began cohabiting in 1977, married in 1980 and separated in 2017. There were no children. At separation, Christian owned a property on Black Walnut Road where he ran an automotive repair and restoration business. Susan co-signed a $3,000 bank loan to finance its purchase and her father loaned Christian ~$227,000 to construct a building on the property.
The equalization issue was resolved. The property was listed in the NFP calculation as valued at $870,000 as of separation. The property later sold for $1,250,000. After accounting for all costs, the increase in value from separation to sale was $194,212. Susan claimed half of it: $97,106, on the theory that the property had been a joint family venture.
The threshold question was whether the doctrine of joint family venture was in play so that Susan could share in the growth after separation.
For unmarried cohabitants the answer is plainly YES. Unjust enrichment and joint family venture are the primary tools available for unmarried spouses. But for married spouses, the court adopted the view that equalization and unjust enrichment cannot be assessed in separate silos. The interplay between them matters, including whether the equalization payment has already done the work that a monetary or proprietary award would otherwise do.
In summary, a separate award for unjust enrichment arising out of a marriage should be the exception, not the rule.
Applied to these facts, the conclusion followed quickly. This was a marriage of long duration. The economic partnership was governed by the Family Law Act. The NFP protocol was controlling, and there was no reason to depart from the presumptive equal division of the increase in total family wealth between marriage and separation. Grafting an unjust enrichment analysis onto a completed NFP calculation post facto was inappropriate where the economic dynamics of the marriage were, as the judge put it, unexceptional. The analysis was superfluous.
The judge nonetheless worked through the analysis of unjust enrichment – which is helpful to educate lawyers and dispute resolution professionals. On the first two elements, Susan did well. The court accepted that Christian may well have been materially enriched and that Susan suffered a corresponding detriment: the unequal contribution to household expenses, co-signing the purchase loan, the line of credit used to pay tax arrears on his property, and the interest-free use of her father’s money were all indicative of a potential unjust enrichment.
Susan’s claim died on juristic reason. At step one of the two-step test, the court found a categorical juristic reason in the established category of statutory obligation – the NFP equalization scheme itself. The Family Law Act embodies a legislative policy judgment that marriage is an equal economic partnership, that the wealth accumulated between marriage and separation is to be divided equally subject to the statute’s own exceptions, and that the parties are then expected to move on and live separate lives.
Schmutz is not a holding that married spouses can never recover beyond the equalization formula. The court expressly noted the two doors the Family Law Act leaves open, and both are inside the statute, rather than outside it. Section 10 permits the determination of questions of title between spouses before or during the equalization exercise. Ownership issues, legal or equitable, are decided before the net equalization payment is calculated. Section 5(6)(h) allows an unequal division in circumstances that can closely mimic the fact pattern of an unjust enrichment claim.
The genuine outside-the-statute exception remains something like Mullin v. Sherlock, 2025 ONCA 510 (CanLII) https://canlii.ca/t/kd7lc: a long cohabitation followed by a very short marriage, where the family wealth was generated almost entirely before the marriage date. There, the equalization snapshot could not achieve the statute’s own purpose, because measuring the ten months between marriage and separation ignored the years of growth that mattered. The mismatch between the statutory measuring period and the economic reality was the trigger – not the mere existence of unequal contributions.
What should practitioners take from this? Post-separation growth is not a gap in the legislation. It is a deliberate feature. Valuation day was chosen; the statute’s answer to what happens afterward is that the parties move on. A claim built on the increase in value between separation and sale is, in substance, an argument that the legislature chose the wrong date.
Sequence is everything. The time to assert an interest in the other spouse’s asset is before the NFP calculation is settled, under section 10, so that it flows through the equalization arithmetic. Once ownership is admitted or determined, an unjust enrichment claim over the same asset is asking the court to unwind an assumption the claimant has already accepted and been compensated on.
Establishing enrichment and deprivation is the easy part. In most long marriages, a claimant can assemble a credible narrative of unequal contribution. The case turns on juristic reason, and for married spouses the Family Law Act is itself a categorical one. Counsel who plead unjust enrichment without a theory of why the statutory juristic reason does not apply have pleaded only two-thirds of a cause of action.
For those of us who mediate/arbitrate these files, Schmutz is a useful screening tool. When a party arrives with a claim to a share of the post-separation increase in the other’s asset, the first question is not whether the contributions were real – they usually were – but whether anything about the timeline makes the statutory formula incapable of doing its job. If the answer is no, the claim is worth far less than the parties think, and both of them are better off learning that before the retainers are exhausted.
Steve Benmor, B.Sc., LL.B., LL.M. (Family Law), C.S., Cert.F.Med., C.Arb., FDRP PC, Acc.D.C., is a full-time Divorce Mediator/Arbitrator and principal lawyer of Benmor Family Law Group, a boutique matrimonial law firm in downtown Toronto. He is a Certified Specialist in Family Law, a Certified Specialist in Parenting Coordination and was admitted as a Fellow to the prestigious International Academy of Family Lawyers. Steve is regularly retained as a Divorce Mediator/Arbitrator and Parenting Coordinator. Steve uses his 30 years of in-depth knowledge of family law, court-room experience and expert problem-solving skills in Divorce Mediation/Arbitration to help spouses reach fair, fast and cooperative divorce settlements without the financial losses, emotional costs and lengthy delays from divorce court.
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