What is a multigenerational household?
A multigenerational household is a home where three or more generations reside. These households contain at least one person who is both the grandparent and the parent of someone in the house. In Alberta, these households comprise just a small percentage of all households. However, this percentage has grown and that trend is expected to continue.
The reasons for the rise in multigenerational living are varied. Some reasons include affordability, childcare relief, caring for an aging population, and seeking family connections.
What are the advantages of a multigenerational household?
Multigenerational living provides financial stability. By living together, family members can share the costs of housing, utilities, groceries, and childcare. This is especially helpful given how expensive housing has become in Canada.
Aside from financial benefits, multigenerational living offers practical advantages, like having family members care for older and younger generations. Grandparents often help with the kids, which offsets the high cost of childcare. For them, caring for children reduces loneliness and provides a purpose, which contributes to longevity.
What are the disadvantages of a multigenerational household?
Living in close quarters can feel crowded. Privacy can be hard to find, and lifestyle differences may collide. This can lead to stress, strained relationships, and health issues. Grandparents might face financial pressure if they are helping their adult children with expenses, which could delay their own retirement. The middle generation, caring for their parents and children, often finds this arrangement particularly stressful.
Landlord-Tenant laws
If family members in a multi-generational household share the same living space and there is no formal rental agreement, landlord-tenant laws don’t apply. The Residential Tenancy Act, for example, doesn’t cover situations where the landlord lives in the same space as the tenants. However, there could be exceptions if there’s a residential tenancy agreement or a self-contained living space within the home (like a suite rented out to a family member).
Co-ownership consideration
Co-ownership may arise when multiple homeowners live together. This could be in the form of a joint tenancy or tenancy in common. Joint tenancy is when co-owners share equal interest and rights in the property. Ownership automatically transfers to the remaining owner(s) on the title if one passes away.
Tenancy in common refers to co-owners who legally share ownership but do not automatically have the right to the deceased’s interest if one passes away. Often, only one or two family members are listed on the title, leaving others without ownership in the family home. It is important to consider these forms of tenancy when considering a multigenerational living arrangement.
Family law and joint family ventures
In Alberta, federal and provincial family laws apply to spouses, parents, and guardians. They do not address the relationship between relatives living together.
Joint family ventures are the primary legal lens through which courts have settled disputes related to multigenerational household arrangements. A joint family venture arises where parties to a relationship contribute to a business or other effort (in this case, a home) to accumulate wealth. In law, when one person contributes to a venture to their own detriment but to the benefit of another, it is referred to as “unjust enrichment”.
In 2023, the Ontario Superior Court of Justice considered unjust enrichment in the context of a joint family venture in Sidhu v Sidhu. From 2004-2022, Parminder Sidhu and his wife, Amandeep Sidhu, lived in the home of Sukhminder Sidhu (Parminder’s Mother). The Court weighed whether the adult son and his wife were entitled to claim a share of the sales proceeds from Sukhminder’s house. Parminder and Amandeep argued that their contributions to the mortgage and home upkeep from 2004-2022 amounted to unjust enrichment.
To determine the answer, the Court looked at whether one party was enriched, the other was deprived, and whether there was a valid legal reason for this imbalance. In this case, the court decided that both parties had benefited from the arrangement. While the arrangement had advantaged Sukhminder, there was not a corresponding deprivation to Parminder and his wife. They, too, had economically benefited from the arrangement.
This case shows how courts assess factors like mutual effort, economic integration, and family members’ intentions to determine whether a joint family venture exists. Simply living in your parents’ house, even when paying rent, does not amount to unjust enrichment.
The bottom line
Residential tenancy laws usually do not apply unless there’s a formal agreement or a self-contained living unit within the home. Still, family law concepts like joint family ventures and unjust enrichment may be relevant when disputes arise over ownership of multi-generational homes. It is important to put intentions in writing, even when it involves family.
Living in a multigenerational household is a beneficial option for families seeking financial stability and mutual caregiving support. However, it also comes with challenges like reduced privacy and financial complexities. As these living arrangements grow in popularity, families need to communicate expectations and consider formal agreements regarding shared finances and/or property ownership. Understanding the legal landscape can help avoid potential disputes and ensure fair compensation for all family members.
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DISCLAIMER The information in this article was correct at time of publishing. The law may have changed since then. The views expressed in this article are those of the author and do not necessarily reflect the views of LawNow or the Centre for Public Legal Education Alberta.
About Megan Pratt
