Common Law Relationships

Are You in a Common Law Relationship?
If you are in a common law relationship (living together with someone in a conjugal relationship), then you can enter into a prenup. This kind of prenup has a special name – a cohabitation agreement. A cohabitation agreement works the same way as a prenup. They are different from prenups, as common law couples have different family law rights than married couples, but for most practical purposes, they are the same as prenups, and any discussion about prenups will equally apply to cohabitation agreements.

Why Get a Cohabitation Agreement?

The law relating to common law relationships in Canada is a mess. Unlike for married couples where there are precise rules for how property is divided if a relationship ends, no such thing exists for common law couples. For instance, you and your partner may be equally sharing the cost of a home that is in your partner’s name. If you were married, the house would be shared equally. If you are unmarried, there is an automatic presumption that the house belongs to your partner, as your partner’s name is on the home. To get a share of the home, you must rely on a complicated and expensive legal claim known as unjust enrichment.

It is difficult to know in advance, even for an experienced lawyer, what the result of a claim for unjust enrichment will be. This makes these sorts of cases difficult to settle amicably, which further increases legal fees. You may want to avoid this, and share property equally as if you were married. Or not share property at all. Or share some property.

Many people are unaware that cohabiting couples do not have the same legal rights to property division as married couples. As well, many people are unaware that cohabiting couples have a right to spousal support – in Ontario, after 3 years of cohabitation (or 1 year if you have a child together), it is possible for one partner to claim spousal support from the other partner.

When to Get a Cohabitation Agreement?

The best time to get a cohabitation agreement is before you move in together or have a child together. Obviously, this is not always possible or practical, but generally, the sooner the better.

Note that you can enter into a cohabitation agreement at any time – even if you and your partner have lived together for many years.

What if We Marry?

If you marry, your cohabitation agreement continues in effect. There is no need to do anything special to ensure that this occurs.

What’s the cost and process?
The cost and the process is the same as for a prenup. You can read about the cost here and the process here.

You’re Invited to Call or E-Mail!

If you’re considering a cohabitation agreement — or have already made your decision — you’re invited to call or email us. We’ll explain for free how you can protect your assets and plan your estate. You can call us toll-free at (800) 837-0460 or email us using our contact form here. We can help you anywhere in Ontario.

Comments

  1. I am in the process of getting divorced which will be completed in less than two months. I have been dating someone and we are thinking of moving in together. There r no kids involved nor will there ever be. I have about $750,000 in assets which include my home and savings. He has about $400,000. Can an agreement be made up that in the event of separation or divorce if we get married be that if we end the relationship, I walk away with the difference of $350,000 more of our total assets as once we live together we want to make everything joint. It would be in the event of separation I walk away with more than him as I am coming in with $350,000 more.

    • prenuplawyer says

      @Ody – Yes, you can do that. You may also want to consider inflation – for instance, indexing the $350,000 amount to the CPI.

  2. Jennifer says

    My fiancée’s lawyer prepared him a cohabitation agreement for us to review, however we are not common law nor have we been living together before our upcoming wedding in September. Is this correct or should we be preparing a prenuptial agreement?

    In addition, the lawyer requested that we complete a 13.1 form to outline finances. I have read that this form has other uses, so I was wondering why he may have suggested using a 13.1. Is this standard practice in this instance?

    I had other questions regarding wording about the cohab agreement being binding after one or both parties is deceased and that seemed unusual. I would think that a will would supersede it.

    There was also a clause about waiving the right to ask for spousal support from either party forever. Is this a common clause?

    Many thanks in advance for your reply.

    • prenuplawyer says

      @Jennifer – Sometimes a cohabitation agreement will be prepared if there is a long time before the wedding, and the couple is living together, just in case. In your situation, I do not see the need for it. That being said, a cohabitation agreement becomes a prenup upon marriage, so it likely does not make any practical difference.

      Full financial disclosure is necessary for a prenup. A form 13.1 is not required; however, it is a standard form that all family law lawyers are familiar with, so often used.

      Regarding the agreement being binding after one passes away, that is so that the deceased person’s estate is bound by the agreement, so cannot ask for property division, etc. different from what is in the agreement.

      Spousal support is too complicated to answer in a brief comment. A lot really depends on your ages, incomes, career paths, plans to have children, health, etc. If you are both young and starting out, with plans to have children, a spousal support release would normally be inappropriate. If you are both older, well established in good paying careers, and unlikely to have children, then a spousal support release would not be unusual.

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