In Ontario, the law permits unmarried persons who live together to enter into contracts that specifically outline their rights and obligations in their relationship. These are known as cohabitation agreements. Unmarried couples often choose to enter into a cohabitation agreement when they share a living space for the protection of both parties.
A cohabitation agreement can help prevent uncertainty, litigation, and additional costs in the event of the breakdown of the relationship. Ontario specifically recognizes cohabitation agreements under the Family Law Act, which sets out the rules for domestic contracts and the formal requirements for enforceability.
At Gelman & Associates, our Toronto family law lawyers help clients with the negotiation, drafting, review, and enforcement of cohabitation agreements across Ontario. To connect with our cohabitation agreement lawyers in Toronto about your situation, contact us today.
What are the Benefits of a Cohabitation Agreement?
According to the latest 2021 census figures, common law relationships continue to be a significant part of family life in Ontario and across Canada. For this reason, more couples are choosing to clarify their expectations in advance rather than wait for conflict to arise later down the line. This is especially important because common law spouses do not automatically have the same property rights as married spouses under Ontario family law.
Property Division for Common Law Couples in Ontario
The distinction in relationship status matters. Couples who live together, but are not married, are not included in the section of Ontario’s Family Law Act, which states that property accumulated during the marriage must be equalized.
In some circumstances, an equalization claim can be pursued by unmarried parties through common law trust doctrines or claims focusing on unjust enrichment. Common law partners may also be entitled to spousal support and child support in the case of the dissolution of the relationship. However, a cohabitation agreement is one of the best ways for an unmarried couple to define in advance how property, support obligations, and other financial matters will be handled if the relationship ends.
A robust agreement prepared by a legal professional can also reduce misunderstandings about ownership of a home, contributions to joint expenses, treatment of debts, expectations around support, and estate-related intentions. For many couples, the value of a cohabitation agreement is not only legal protection but also clarity and peace of mind.
When Should You Consider a Cohabitation Agreement?
A cohabitation agreement is often worth considering:
- Before moving in together
- After purchasing a home together
- When one partner already owns real estate
- When one person has children from a prior relationship
- When there are significant savings or family gifts to protect
- When one partner owns a business or expects a future inheritance
For some couples, a cohabitation agreement is also a practical step to take before marriage, since the agreement can later continue as a marriage contract if they marry each other.
The Characteristics of a Cohabitation Agreement
A cohabitation agreement is generally created between two people who are cohabiting or intending to cohabit and who are not married to each other. It can be used by common law spouses and by couples planning to move in together. It is similar in some respects to a marriage contract or a prenuptial agreement, but it is designed for unmarried couples.
Under section 53 of Ontario’s Family Law Act, parties to a cohabitation agreement may agree on matters such as ownership in or division of property, support obligations, the right to direct the education and moral training of their children, and other matters in the settlement of their affairs. The same legislation also provides that if the parties later marry each other, the cohabitation agreement may automatically become their marriage contract.
Cohabitation Agreement Vs. Marriage Contract In Ontario
A cohabitation agreement and a marriage contract can cover many of the same financial issues, but they are used in different circumstances.
A cohabitation agreement is generally intended for two people who are living together, or intend to live together, and are not married. A marriage contract can be entered into by people who are already married or who intend to marry. A marriage contract signed before the wedding is commonly called a prenuptial agreement.
Under Ontario’s Family Law Act, a cohabitation agreement can address matters such as property ownership, division of property, support obligations, and other financial arrangements between the parties.
One important distinction is what happens if an unmarried couple later gets married. Ontario’s legislation provides that, unless the agreement says otherwise, a cohabitation agreement between two people who subsequently marry each other is deemed to become a marriage contract.
This means couples who expect that marriage may be part of their future should consider not only their circumstances today, but whether the terms of their agreement will still reflect their intentions after marriage.
| Characteristics of a Cohabitation Agreement | Characteristics of a Marriage Contract |
|---|---|
| A cohabitation agreement is between two people who are cohabiting or intending to cohabit. | A marriage contract is between two people who are already married or intending to marry each other. |
| Common-law spouses can use it. | It applies to legally married couples and not to common-law spouses or unmarried couples who are living together. |
| It’s not the same as a prenuptial agreement. | Prenuptial agreements can turn into marriage contracts once the parties get married to each other. |
Which Type of Agreement Do We Need?
The right agreement generally depends on your relationship status and future plans.
If you are living together or preparing to move in together without being married, a cohabitation agreement will usually be the relevant form of domestic contract. If you are preparing to marry and want an agreement specifically structured around marriage, a marriage contract or prenuptial agreement may be more appropriate.
Couples who are unsure about their legal status can also review our guide to marriage and common law relationships in Ontario. A family lawyer can help determine which agreement fits your circumstances and whether an existing agreement should be revised before or after marriage.
What is Included in a Cohabitation Agreement?
The terms of a cohabitation agreement provide assurances to each party on matters such as:
- Rights to share in the other’s property
- Support obligations to each other (excluding child support)
- Responsibility for debts or expenses
- Ownership of specific assets
- Treatment of future purchases
- Entitlement to share in the other’s estate on death
- And possibly more
Depending on the couple’s circumstances, a cohabitation agreement may also address how joint household expenses will be handled, what happens if one party contributes to property owned by the other, whether one person is moving into a home already owned by the other, and how business interests, inheritances, or family gifts will be treated.
It’s important to note that a cohabitation agreement can turn into a marriage contract and continue to be valid if the parties marry at some point in the future. In addition, there are also limits to the scope of provisions a cohabitation agreement can set out. Domestic contracts in Ontario cannot conclusively determine parenting or child support issues in a way that prevents a court from acting in a child’s best interests. The court may disregard domestic contract terms dealing with children where appropriate.
How Much Does A Cohabitation Agreement Cost In Ontario?
There is no single fixed price for a cohabitation agreement in Ontario. The cost will depend on the complexity of the couple’s financial circumstances, the terms they want to include, how much negotiation is required, and whether substantial revisions are needed before the agreement is signed.
A relatively straightforward agreement involving clearly identified assets may require less legal work than an agreement involving a business, several properties, significant investments, family trusts, expected inheritances, or complicated support provisions.
Cost can also be affected by the amount of financial disclosure required and the degree to which the parties already agree on the proposed terms. Where substantial negotiation is necessary, legal fees may increase.
Each party may also choose to obtain independent legal advice from a different lawyer before signing. Although this can add to the initial cost, obtaining proper legal advice and financial disclosure can help reduce uncertainty and the risk of a future dispute over what the agreement means or whether it should be set aside.
For information about the anticipated legal work and fees for your circumstances, contact Gelman & Associates at 1-844-736-0200 to discuss a consultation with a Toronto cohabitation agreement lawyer.
How Our Toronto Cohabitation Agreement Lawyers Can Help
At Gelman & Associates, our Toronto cohabitation agreement lawyers help clients prepare cohabitation agreements that reflect their real circumstances and future goals. That may include drafting a new agreement, reviewing a proposed agreement, negotiating terms, or advising on whether an existing agreement is likely to be enforceable.
We take the time to understand each client’s financial picture, living arrangements, relationship history, and concerns about the future. Our goal is to create practical, clear agreements that reduce ambiguity and are more likely to stand up if later challenged. Where needed, clients can also connect with related team members, such as our Toronto divorce lawyers, Toronto property division lawyers, or Toronto spousal support lawyers.
What Makes A Cohabitation Agreement Enforceable In Ontario?
Ontario’s Family Law Act establishes formal requirements for domestic contracts. A cohabitation agreement must be in writing, signed by the parties, and witnessed to be enforceable.
Meeting those formal requirements is important, but careful preparation involves more than obtaining signatures. A court may, in appropriate circumstances, set aside a domestic contract or a provision of it. For example, section 56 of the Family Law Act permits a court to consider issues including significant non-disclosure of assets, debts, or liabilities and whether a party understood the nature or consequences of the agreement.
For that reason, several steps can help support the strength of a cohabitation agreement:
- Both parties should provide appropriate and accurate financial disclosure.
- Each person should have enough time to review and consider the proposed terms.
- Neither person should be pressured or coerced into signing.
- The agreement should use clear language that reflects what the parties actually intend.
- Each party should consider obtaining independent legal advice before signing.
Independent legal advice is particularly important where an agreement significantly changes the financial rights or obligations that could otherwise arise between the partners. Separate legal advice can help each person understand the agreement and make an informed decision about whether to sign it.
Can A Cohabitation Agreement Be Challenged?
Yes. The existence of a signed agreement does not necessarily mean that every provision will be enforced in every circumstance.
Under the Family Law Act, a court has authority in certain circumstances to set aside a domestic contract or part of one. Challenges may involve allegations concerning inadequate financial disclosure, a lack of understanding about the agreement, pressure or duress, or other circumstances relevant under Ontario law.
Whether an agreement can successfully be challenged is highly fact-specific. Anyone concerned about the validity of an existing cohabitation agreement should obtain legal advice based on the wording of the agreement and the circumstances in which it was negotiated and signed.
Cohabitation Agreements in Ontario: Frequently Asked Questions
Do We Need A Cohabitation Agreement If We Are Not Yet Common Law?
You do not necessarily have to wait until you meet a particular definition of common law before making an agreement. Ontario’s Family Law Act permits two people who are cohabiting or intend to cohabit and are not married to enter into a cohabitation agreement.
This can make it useful for couples who want to clarify financial expectations before they move in together.
Does A Cohabitation Agreement Become A Prenup If We Get Married?
A cohabitation agreement does not literally change into a “prenup,” since a prenuptial agreement is commonly used to describe a marriage contract entered into before marriage. However, under Ontario’s Family Law Act, a cohabitation agreement between two people who later marry each other is generally deemed to become a marriage contract unless the agreement provides otherwise.
Couples approaching marriage should have their existing agreement reviewed to determine whether its terms still reflect their circumstances and intentions. Our Toronto prenuptial agreement lawyers can assist with agreements entered into in contemplation of marriage.
Can We Write Our Own Cohabitation Agreement In Ontario?
Couples can discuss and record their intentions themselves, but a domestic contract can have significant long-term financial consequences. Problems may arise when terms are unclear, important assets have not been disclosed, formal signing requirements have not been followed, or one person does not understand how the agreement changes their rights.
Having a Toronto cohabitation agreement lawyer draft or review the agreement can help ensure that the document reflects the parties’ intentions and complies with Ontario law.
Do Both Partners Need Separate Lawyers For A Cohabitation Agreement?
Ontario law does not make independent legal advice one of the basic formal requirements for every cohabitation agreement. However, each partner obtaining advice from a separate lawyer can be an important safeguard.
Independent legal advice gives each person an opportunity to understand the proposed agreement, its financial consequences, and the rights they may be changing or giving up. It may also reduce the risk of later disputes about whether a party understood what they signed.
Can A Cohabitation Agreement Protect A House I Owned Before The Relationship?
A cohabitation agreement can address ownership of property and what the parties intend to happen if their relationship ends. This can be particularly important when one partner owns a home before cohabitation begins or when the other partner will contribute to mortgage payments, renovations, or household expenses.
Because common-law partners do not automatically have the same property equalization rights as married spouses in Ontario, couples should obtain legal advice about how ownership, contributions, and potential property claims may interact with the terms of their agreement.
If You Are In A Common Law Relationship, Contact Our Toronto Cohabitation Agreement Lawyers for Assistance
If you are in a common law relationship, planning to move in together, or would like to protect assets before cohabitation begins, contact Gelman & Associates for advice about drafting, reviewing, or enforcing a cohabitation agreement.
Gelman & Associates serves clients across Ontario and offers practical family law guidance tailored to your circumstances. To discuss your situation, call 1-844-736-0200 or contact the firm through its online contact page.
