Relationships come in various forms, and cohabitation before or instead of marriage has become an increasingly popular choice for many couples across the country. Whether it provides a trial period of learning each other’s daily habits, financial convenience, or a conscious decision to forego traditional ceremonies, cohabitation has become a popular lifestyle choice for individuals in British Columbia and beyond.
However, at the heart of cohabitation lies a complex legal landscape; cohabitation agreements are often overlooked by parties seeking to begin their lives together. These agreements, while not the most romantic component of a relationship, play a key role in defining the rights and responsibilities of individuals cohabiting with their partner.
This blog will be a comprehensive resource for those considering or already cohabitating in British Columbia. It will shed light on the primary benefits and potential pitfalls of this type of contract. It will explore how these documents can safeguard both partners’ interests during a separation or legal dispute. Whether you are a couple planning to move in together or you have been cohabiting with your significant other for some time, this blog will provide valuable insights into the world of cohabitation agreements.
A cohabitation agreement is a type of domestic contract that is prepared by unmarried couples who plan on or have been, living together. A cohabitation agreement outlines various aspects of the relationship, including the parties’ respective property rights, financial responsibilities, and potential separation scenarios. In essence, this legal document functions as a measure of protection by preserving and detailing each person’s rights while clarifying various issues and expectations in case of a breakup or future dispute.
If the parties wish to formalize the relationship through marriage, their cohabitation agreement may form the basis of a marriage agreement. Alternatively, if the parties later decide to separate or divorce, the terms of the cohabitation agreement may be incorporated into a separation agreement or divorce order. Therefore, each party should obtain independent legal advice before signing a cohabitation agreement to ensure they understand the nature of the terms they are agreeing to, as well as the potential consequences of agreeing to certain terms.
In British Columbia, the Family Law Act governs the rights and obligations of unmarried couples who reside together. This legislation also recognizes the rights of individuals in common-law relationships, akin to those in formal marriages, after a certain period of cohabitation. However, without a cohabitation agreement, parties will be subject to the default rules and assumptions under the Family Law Act, which may not align with the couple’s intentions.
Although the specific issues addressed in a cohabitation agreement may vary from couple to couple, a cohabitation agreement can address matters related to:
- Financial obligations;
- Property and asset rights;
- Protection against debt liability;
- Spousal support and
- Promotion of open communication and disclosure between the parties.
More specifically, a comprehensive cohabitation agreement can outline:
- What purchases and expenses will be made jointly or solely, including household expenses;
- Whether either spouse will be entitled to spousal support in the event of a separation, and if so, how much will they be entitled to and for how long;
- How the parties will divide property brought into the relationship, how they will split assets and property accumulated throughout the relationship, and
- The parties’ entitlement to ownership or possession of the family home upon separation.
A cohabitation agreement can be tailored to the couple’s needs and circumstances. However, while couples are encouraged to enter into an agreement that covers their rights and responsibilities relating to assets, finances, and debts in the event of a breakup, this is not a legal requirement.
In British Columbia, a cohabitation agreement is not permitted to address parental rights or child support obligations for children, whether or not they are already born. While these issues are worth discussing with your partner, these matters cannot be set in stone in a cohabitation agreement.
A court may set aside a cohabitation agreement for various reasons. A common reason that an agreement may be set aside is due to the need for more independent legal advice. Before signing a cohabitation agreement, both parties are strongly encouraged to obtain independent legal advice to ensure they have a full understanding of the terms they are agreeing to and the rights they may be giving up.
A cohabitation agreement may also fail if it is determined that one or both parties failed to provide the other with full and accurate financial disclosure. Suppose one party is found to have concealed assets from the other. In that case, the agreement may be set aside, as it is paramount that both parties have full awareness of the other’s financial obligations and assets before entering into any agreement.
Further, section 93 of the Family Law Act provides a statutory basis on which a property agreement may be set aside. Ultimately, this provision explores whether the agreement is significantly unfair to one party, particularly in cases where the parties have been together for a substantial period, and one spouse would be detrimentally impacted if the agreement is upheld. Alternatively, a cohabitation agreement may be voidable for a reason which, at common law, could void a contract. In other words, if there is evidence to suggest that a party signed the agreement under duress or through fraud, the agreement may not be upheld.
Contact the Family Lawyers at Meridian Law Group in Vancouver for Assistance Preparing a Cohabitation Agreement
At Meridian Law Group, our team of experienced family lawyers works closely with our clients to understand the needs and goals of any domestic contract, including cohabitation agreements. By addressing various family law issues proactively through a cohabitation agreement, parties can mitigate contentious conflicts in the event of a relationship breakdown through divorce or separation. To speak with a member of our team regarding your questions about domestic contracts, call us at (604) 687-2277 or contact us online to learn how we can help you.