Mallory Arnott, Family Lawyer
When two people decide to get married, they intend to stay together, til death do they part. However, the statistics tell us that almost half of all marriages end in divorce. You can save yourself a lot of heartache and costs, by planning ahead with a marriage contract, or cohabitation agreement. Even if you only have one asset you would like to protect, such as a property, it is worth considering one of these agreements.
A marriage contract is an agreement between two people getting married, or who are already married. It sets out their rights and obligations if the couple separates, or if one party should die. When married spouses separate, there is a presumption of equal division of all matrimonial property. With a marriage contract, you can opt out of this presumption and divide the assets in a way that both spouses feel is fair given their circumstances.
A cohabitation agreement is the same as a marriage contract, except the parties are not married and do not intend to get married in the near future. This agreement would be appropriate for common law couples wanting to protect their assets in the event of a breakdown of the relationship.
Marriage contracts and cohabitation agreements are not for everyone, nor are they necessary for all couples. Everyone who is legally married is in effect governed by a marriage contract as set out in the legislation. The rules surrounding common law couples are less certain. If you are in a common law relationship and are unsure of your rights in the event of a separation, a cohabitation agreement may be a good idea.
There are a few things that cannot be dealt with in these agreements. Custody of the children is one of them. Another example of a clause that would not be allowed would be one indicating that the contract is null and void if the other has an affair. In Canada, fault is not taken into account during divorce proceedings.
Always seek independent legal advice, and do not sign such an agreement without full financial disclosure from your soon-to-be spouse. Once a marriage contract is signed, there are very limited circumstances in which a court will intervene. If you sign it, need to be prepared to live with it. That being said, the agreements can be renegotiated throughout the relationship as the circumstances and assets change.
Understandably, some people don’t want to spend legal fees preparing for a separation they hope will never happen. But considering an agreement now, when times are good, rather than trying to resolve these issues during an emotional separation, could end up saving a lot of money in the long run.
If you think a marriage contract or cohabitation agreement might be right for you, please do not hesitate to contact us.
*This article is meant to be for information purposes only and is not intended to be legal advice or opinion. If you have any further questions please consult a lawyer. Many of the statements in this blog post are general principles which may vary depending on each person’s case.