This is the second article of a three-part series. In the first article, found here, we introduce the importance of cohabitation agreements and marriage contracts. In this article, we will discuss the differences in the law between married and common law spouses to further highlight the importance of these contracts. Finally, in the third part, we will review the process to create a marriage contract or cohabitation agreement.
How does family law in Ontario define a common law spouse?
If you are not married but in a serious relationship with someone, it is worth exploring whether you are considered common law spouses at law.
Section 29 of the Family Law Act provides an expanded definition of “spouse” with respect to support obligations which includes either of two persons who are married to each other and have cohabited,
- Continuously for a period of not less than three years, or
- In a relationship of some permanence, if they are parents of a child.
The Family Law Act defines cohabit to mean, “to live together in a conjugal relationship, whether within or outside of a marriage”.
Legislation is subject to interpretation by the courts. If you would like to learn more, you can read our article found here about a recent court decision that examined the scope of this definition. The case involved a couple deemed to be common law spouses based on their circumstances which involved occasionally residing together while maintaining separate residences as well.
Why should we consider a cohabitation agreement or marriage contract?
A cohabitation agreement or marriage contract gives couples the opportunity to take their circumstances into their own hands and “opt out” of or modify their family law rights and obligations in the event of a breakdown in the relationship. These conversations can be difficult ones to have with your partner but will likely save both parties a lot of time, money, and emotional turmoil. We discuss this in greater detail in Part 1 of this series.
The law differentiates between married and common law partners
Parenting and Support
In Ontario, the laws pertaining to parenting time, decision-making, child support, and spousal support, apply equally to common law and married spouses.
Generally, a cohabitation agreement or marriage contract does not address parenting time, decision-making for the children, or child support, for the children of the relationship. In some cases, it may deal with children from previous relationships or spousal support.
Assets and Debts
In Ontario, the laws relating to the division of property are different whether you are married or common law spouses.
If you are married, there is an automatic right to division of property in accordance with the Family Law Act, unless you “opted out” by way of marriage contract.
For example, if one party owns a home on the date of marriage and that home is the matrimonial home on the date of separation, the spouse will not be able to deduct the value of the home on the date of marriage like they may be able to do with other assets owned on the date of marriage. Similarly, if a spouse receives an inheritance during the marriage and puts those funds towards joint assets like the matrimonial home, that spouse will not be able to exclude those funds like they may be able to do with inherited funds that re kept separate.
To learn more about exclusions and date of marriage deductions, read our blog here:
If you are in a common law relationship, there is no automatic right to division of property, unless you “opted in” by way of a cohabitation agreement, or an exception in the law applies to you.
Upon the breakdown of a common law relationship, property is divided in accordance with ownership unless a spouse can successfully prove a claim such as unjust enrichment by way of a constructive trust against the other spouse’s property interests. The burden is on the party making a claim for unjust enrichment by way of a constructive trust to prove the following:
- That their financial or non-financial contributions benefits (or enriched) the other party with titled interest in the property in question;
- That the benefit to the other spouse resulted in a corresponding depravation to the spouse making the claim;
- There is no legal reason (or juristic reason) to justify the benefit and corresponding depravation, such as a contract or gift?
Courts also consider whether there is a connection between the contribution made and the acquisition or improvement to the property when deciding whether to grant the spouse with the claim a proportionate interest in the property. Whenever possible, courts seem to prefer monetary awards rather than granting a proportionate interest in the property itself.
Unjust enrichment by way of constructive trust is one example of a claim that a common law spouse can advance in these circumstances. There may be other claims depending on the circumstances.
As you can imagine, establishing each part of a claim is very much driven by the facts of each case. Practically speaking, this makes it difficult for the lawyer advising you to predict the outcome of your case. This is why many such cases wind up in court when a resolution cannot be reached between the parties. This can be expensive and take a long time.
A cohabitation agreement or marriage contract can help you and your spouse avoid future disputes in the event of a breakdown in the relationship. However, it does require a commitment to have some difficult conversations with your spouse when you are in a happy and flourishing relationship. Stay tuned for the third and final article in this series where we will focus on the process to create a marriage contract or cohabitation agreement.
Our mediators are experienced family lawyers and we are here to help. If you need assistance with a cohabitation agreement or marriage contract, or are in the process of separating from your spouse or considering separation, click here to schedule a free Zoom call with one of our mediators to learn more about our services and to answer any questions you may have about the process of mediation.