In Ontario, what many people commonly refer to as “pre-nups” are actually called marriage contracts or cohabitation agreements. These legal documents outline how assets and responsibilities will be handled in the event of a separation, divorce, or death. Both marriage contracts and cohabitation agreements fall under the broader category of domestic contracts, which also includes separation agreements. Domestic contracts are legally binding documents that define the rights and obligations of each party, helping to prevent misunderstandings and disputes. By setting clear terms in advance, these agreements provide couples with a sense of security and protection as they plan their lives together.
Why would you want a pre-nup/marriage contract or a cohabitation agreement?
The laws that apply when a couple separates (or one partner passes away) might not work for your relationship. Marriage contracts and cohabitation agreements allow you to negotiate while you are in love and getting along what will happen financially if you separate or if one of you dies. You and your partner can decide ahead of time what will happen to your property if your relationship ends, and what are your expectations about financial support after your relationship ends. Marriage contracts and cohabitation agreements can be very helpful to ensure the desired outcome:
- In second or later marriages or cohabitations;
- When you are juggling careers and children;
- When you want to live together or get married but remain financially distinct; and
- In many other situations.
A marriage contract or cohabitation agreement can avoid nasty surprises:
- I have to share the increase in the value of my business?
- I have to share revenue from my business?
- I have to share the value of my house?
- I supported my spouse all through our relationship and now I have to keep supporting him or her even though he or she has left me?
- I am only receiving $X from his or her estate?
Having the necessary discussions to put in place a marriage contract or cohabitation agreement can get your relationship on solid footing by eliminating or reducing hidden agendas and unstated assumptions. We have tools to allow you to have a robust discussion about the financial consequences of your relationship ending. We can help you negotiate a domestic contract in a collaborative fashion in order to strengthen your relationship.
Booking a Consultation with a Family Lawyer
An initial consultation with a family lawyer is an essential first step in understanding your legal rights and options. During this meeting, you may discover that the existing laws governing relationships in Ontario already align with your needs and expectations. If this is the case, there might be no need to pursue a domestic contract such as a marriage or cohabitation agreement.
In other situations, the consultation can provide valuable insights into how to structure your financial and personal affairs to minimize potential risks, even without a formal domestic contract. This guidance can help you make informed decisions that protect your interests and reduce uncertainties in the event of a separation.
For some couples, the consultation reveals that negotiating and signing a domestic contract is crucial to ensure both partners’ rights and responsibilities are clearly defined. This process can also foster open communication and mutual understanding, helping to strengthen the foundation of your relationship. By taking this proactive step, you and your partner can build a more secure and confident future together.