These days it’s becoming more and more common for people to live together as couples without getting married or desiring to do so. This is a convenient model for many people across Canada and the world, but it can cause problems if they decide to separate and they happen to share property, a business or have complicated assets.
Fortunately, there are options for people who wish to live together in “marriage-like” arrangements but also have legal control over their assets and property in the event of a separation. One option for partners who are in common-law relationships is to draft and sign a cohabitation agreement. Such an agreement can help you and your partner outline and make legally binding how you wish to divide your assets in the event of a separation.
Understanding a cohabitation agreement
In Alberta, married couples are obligated to divide half of all assets or debts that were acquired during the relationship if they get divorced. Because this agreement is not always ideal for married couples, many people draft prenuptial agreements when they get married to layout more specifically how they want their assets and debts divided in the event of a divorce.
A cohabitation agreement is a lot like a prenuptial agreement, just without the nuptials. In other words, in the same way, a prenuptial agreement allows a married couple to sort out the division of property and assets in the event of a divorce, a cohabitation agreement allows you and your partner to make the same decisions.
While cohabitation agreements are not for all couples who live together, they can be very useful for people in certain situations and relationships. Listed below are some of the most common reasons that people decide to use a cohabitation agreement:
- You and your partner own individual properties you wish to protect.
- You and your partner own joint properties together.
- You own a business together, or one or both of you owns your own business.
- You live together and have kids together.
- One or both of you has significant assets that you wish to protect.
- One of you or both of you expects to accumulate significant assets in the future.
If any of these situations apply to you and your partner, it may be a good idea to consider the benefits of a cohabitation agreement for your relationship. But, before deciding if a cohabitation agreement is right for you, you should speak with a knowledgeable Family Law lawyer in Edmonton who can help you decide which steps to take next.
When a Cohabitation Agreement is Needed
A cohabitation agreement may be beneficial if you and your partner are, or plan to enter into a relationship whereby:
- You and your partner have or will parent children together and live together, in a relationship of interdependence, with some level of permanence.
- You and your partner have or will reside in the same residence, in a relationship of interdependence, for a minimum of three years continuously.
- You and your partner have entered into an agreement to become “adult interdependent partners”.
A relationship of interdependence is possible if two people share one another’s lives, are committed to each other emotionally, and function as one economic and domestic unit. An adult interdependent relationship, previously referred to as “common-law relationship”, possibly exists if any of the situations above apply, and this gives two people who are not married some of the same legal rights and responsibilities as a married couple.
If you are currently in or plan to enter into an adult interdependent relationship, you may want to speak with a Family Law lawyer to determine whether or not a cohabitation agreement is beneficial for you.
The Benefits of Hiring a Family Law Lawyer for a Cohabitation Agreement
When it comes to cohabitation agreements, there can be numerous benefits from consulting with an experienced lawyer in Edmonton. The fact of the matter is that just like with divorces, disputes over assets and property at the end of a relationship can be contentious and difficult. This is one of the reasons a well-thought-out cohabitation agreement can be so helpful.
Some of the key benefits of consulting with a lawyer when considering a cohabitation agreement include the following:
- Validity. Laws surrounding cohabitation agreements vary per province, and not all agreements that are drafted are legally enforceable. There are many reasons a cohabitation agreement can be considered invalid, and sometimes the slightest error can make a contract not legally binding. The law also requires that you and your partner each obtain independent legal advice prior to entering into a cohabitation agreement for it to be legally binding. When creating such an important contract between you and your partner, it’s best to have a professional lawyer to make sure your agreement is valid and legally binding.
- Deciding if it’s right for you. Not everybody needs a cohabitation agreement and consulting with an experienced lawyer in Edmonton can help you decide if it’s right for you. Generally speaking, couples who share large amounts of property or have children and live together should consider them. Speaking with a family law lawyer in Edmonton is the first step to finding out if it’s the best move for you.
- Understanding its limits. A lawyer can help explain the limits of a cohabitation agreement and what it can and can’t do. For example, child custody issues are not covered in this type of agreement.
A cohabitation agreement is a complex document that is best drafted by a knowledgeable, experienced lawyer. When they are created with the best intentions and for the right people, they can be incredibly helpful in mitigating future disputes and ensuring the well-being and proper division of property and assets among non-married couples.
Contact Chadi & Company Family Law Lawyers Today
Creating a cohabitation agreement on your own can be dangerous and lead to problems down the road. At Chadi & Company, our qualified and compassionate family law lawyers have helped hundreds of couples in Edmonton create legally binding cohabitation agreements that work for them.
To learn more about how a cohabitation agreement can help you and your partner, contact Chadi & Company today for a free consultation at (780) 429-2300. We look forward to speaking with you.