Difference between revisions of "Cohabitation and Living Together Agreements"

Unmarried couples, including unmarried spouses, are not legally married to one another, and they'll stay that way until they are formally married. For the purposes of this discussion, the critical distinction between married spouses, and unmarried spouses and other unmarried couples w lies in the different legal issues that arise when these different sorts of relationship come to an end. Here's a summary:

 

 

 

Issues relating to the care and control and financial support of children born in the relationship are fairly straightforward, since the claim mostly depends on whether someone is a parent, not on the nature of the relationship between the parties. With respect to spousal support, only married and common-law couples may make a claim. Issues relating to property are a bit more complex.

 

Only married couples can make a claim for the division of assets under the Family Relations Act. Since unmarried couples can't apply for the division of assets under the Family Relations Act, they can only make a claim against assets owned by the other under the law of trusts, usually the law relating to constructive trusts, express trusts or resulting trusts. (If the couple jointly owns real property together they can also make a claim under the Partition of Property Act.) Trust claims are a lot more complex than making a claim under legislation, and, even if the trust claim is successful, the amount awarded is generally a lot less than what the result would have been had the couple been married.

 

Trust claims to assets are discussed in the chapter Family Assets > Dividing Assets.

The usual reason why a couples enter into cohabitation agreements is to protect their respective property and finances, so that each party's assets going into a relationship are preserved as much as possible if the relationship comes to an end. Sometimes one party wants to preserve property from claims by the other party; sometimes a party wants to protect property from the other party's debts. Generally speaking, most couples who are thinking about executing a cohabitation agreement want a "I'll keep what's mine, you'll keep what's yours" sort of deal. Curiously, as was just mentioned and as will be explained later in more detail, this is precisely the wrong reason to have a cohabitation agreement.

the relationship is expected to be a long one;

one or both parties have a substantial amount of assets going into the relationship;

one of the parties has significantly more income than the other;

one or both parties expect to acquire substantial assets during the relationship from, for example, a business, an inheritance, a court award, a gift or employment income;

one or both parties is bringing a child into the relationship; or,

the parties expect that spousal support may be an issue if the relationship ends.

the couple are young;

neither party has significant assets or income going into the relationship;

neither party is bringing any children into the relationship; or,

both parties are working out of the home and expect to continue working out of the home.

The usual sort of issues a household management type of cohabitation agreement might be intended to address include:

If, at the end of the day, a cohabitation agreement is appropriate and desireable, the parties will negotiate the terms of the agreement, and someone, whether a lawyer or one of the parties, will draft the written agreement. As with all family law agreements, it is important that both parties get independent legal advice about what exactly the agreement means, how it affects their present rights and responsibilities towards one another, and how it will affect those rights and responsibilities if their relationship comes to an end. Getting independent legal advice strengthens the agreement by preventing one spouse from saying "I didn't know what it meant!" if the agreement is challenged later on.

In my view most of these do-it-yourself kits are fine for most people most of the time. They are not fine for cohabitation agreements. Cohabitation agreements can be terribly complicated, more so than marriage agreements or separation agreements, and must be drafted with a good knowledge of family law in general and cohabitation agreements in particular. I really encourage you against do-it-yourself cohabitation agreement kits.