If you are planning on taking the next step in your relationship, whether that be moving in together or getting married, an important consideration may be whether you and your partner should have a cohabitation or marriage agreement (often known as a Pre- or Post- Nuptial agreement) prepared.
What is a Cohabitation/Marriage Agreement?
A Cohabitation Agreement is prepared by couples moving in together but are not yet legally married. A Marriage Agreement is prepared in anticipation of marriage or once you are already married. Both Agreements define the rights and obligations of partners who live together and outline the party’s intentions when it comes to managing their financial and property matters in the event of a breakdown of the relationship.
Key Components of a Cohabitation/Marriage Agreement
A Cohabitation/Marriage Agreement allows a couple to essentially “contract” themselves out of the Family Law Act and the default property division and support laws and establish their own terms. Items that can be considered in a Cohabitation/Marriage Agreement include:
- Property Division: The agreement can specify how property and assets will be divided in the event of a separation, including real estate, personal belongings, bank accounts and investments. This can also include what will remain one party’s separate and excluded property in the event of a breakup.
- Debt Responsibilities: It can also outline how debts incurred before and during the relationship will be handled and by whom.
- Spousal Support: The agreement could address whether one party will have the right to receive spousal support, including details like how much, for how long, and if under certain circumstances. Couples may also choose to both waive their rights to spousal support and to make any future claims for spousal support in the event there was a material change in their financial circumstances post-separation.
- Children and Child Support: If a couple has children or anticipates having children, the agreement can address how those children will continue to be raised (school choice, religious upbringing etc.) in the event of separation. If one party has a child from a previous relationship, details on who will have financial responsibility for that child can also be included in the agreement. It is important to note, that unlike spousal support, parties cannot agree to waive any rights to receive child support, as child support is the right of the child, not the party receiving it.
- Dispute Resolution: An Agreement can also include terms on how the parties will resolve any disputes relating to the contents of the agreement, including mandatory mediation or arbitration.
Legal Requirements
To ensure a cohabitation/marriage agreement is enforceable and will not be found to be significantly unfair and overturned by the courts, it is important to ensure that:
- The agreement is in writing to ensure clarity
- The agreement is signed by both parties, and preferably witnessed
- Although not mandatory, parties should consider obtaining their own independent legal advice before signing the agreement to ensure they understand their rights and the relevant implications of the agreement
- Parties receive adequate disclosure of the details of their partner’s financial assets and debts prior to singing the agreement
A cohabitation/marriage agreement is an important consideration for couples, especially those coming into a relationship with significant assets. It can help prevent misunderstandings and disputes regarding financial matters upon separation and can help couples avoid timely and costly legal battles in the event of a separation.
This information is general in nature only. You should consult a lawyer before acting on any of this information. This information should not be considered as legal advice. To learn more about your legal needs, please contact our office at (250)448-2637 or any of our lawyers practicing in the area of family law.