Under section 85(2) of the Family Law Act, excluded property include: property acquired by a spouse before the relationship began; inheritances to one spouse; gifts to a spouse from a third party; a settlement or damage award, unless it’s compensation for a loss to both spouses or compensation for the lost income of either spouse; and money paid under an insurance policy, as long as the policy doesn’t insure property, and unless it’s compensation for a loss to both spouses or compensation for the lost income of either spouse. Only the gain in the value of the excluded property during the relationship is divided between the spouses upon divorce or separation. This means if your excluded property depreciates during your relationship then it would not be subject to division upon divorce or separation (Asselin v Roy, a 2013 BCSC case that was the first case to deal substantively with the division of property under the Family Law Act, para 222). The default rule is that property is valued at the time of the trial. However, it can be valued at a different date if agreed between the parties or ordered by the court. The onus to prove exclusion lies with the person who intends to claim the exclusion. To prove exclusion, you need to provide the court with clear and cogent evidence. If documentary evidence is not available, the party bearing the onus of proof will need to testify as to their recollection of the transactions in dispute, which will be scrutinized for credibility (Shih v Shih, 2017 BCCA 37). To win your claim for exclusion, you should be able to produce documents (i.e. bank transfers, land title documents, property purchase statement, etc) that shows the amount you want to exclude was originally your excluded asset. It is important that you keep track of your paperwork or collect and preserve relevant documents. Keep in mind, sometimes there are deadlines imposed by other institutions to get records. For example, you can ask banks in Canada for production of bank statements going back only 7 years. Often during long term relationships, you replace properties. You may still be able to claim exclusion so long as you can trace the new property to an excluded asset (i.e. you can show that the property was purchased with an excluded property). The law is slightly more confusing if you’ve transferred your excluded property in BC to your spouse, for example by transferring a house that you originally owned into your now ex-spouse’s name. In V.J.F. v. S.K.W., 2016 BCCA 186 (CanLII), the husband received a $2 million inheritance (excluded property in BC) and then used this inheritance to build a new family home, which he put into the name of his wife to protect the property from creditors.  Relying on the legal principle of presumption of advancement, the Court of Appeal held that the money was in fact a gift from the husband to the wife and as a result the family home was no longer excluded property but instead divisible 50/50 between the now ex-spouses. However, some cases decided after VJF have not followed the principle laid out in that case. For example, in  K.R. v. J.D., 2017 BCSC 182, Jenkins J. distinguished V.J.F.in concluding that no presumption of advancement arises when one spouse’s inheritance is invested into property owned jointly by that person and his or her spouse. The excluded property regime under the Family Law Act is not straight forward. It is best to discuss your case with our seasoned Vancouver property division lawyers to strategize your case at the outset and to know what documents you need to prove your exclusion as early as possible.