What Is a Marriage Contract?
In Canada, a marriage contract is a voluntary agreement between two parties who are planning to marry or are already married. It sets out how certain matters will be dealt with should the parties separate, divorce, or die.
This type of agreement is most often entered into before marriage (referred to as a prenuptial agreement or “prenup”). It is a good idea for couples who want to outline, in advance, what will happen to each partner’s assets and finances in the event of separation, divorce, or death.
A similar contract can also be entered into after a couple has been married (referred to as a postnuptial agreement or “postnup”).
Postnuptial agreements can be a bit more complex as there is little leverage after the marriage has taken place and there are already shared assets to consider, but they are feasible so long as the couple can agree to terms. Both types of marriage contracts can be entered into, and are legally enforceable, for both same-sex marriages and opposite-sex marriages. Unmarried individuals have the option of drawing up a similar agreement, often referred to as a cohabitation agreement.
What is Included in a Marriage Contract?
Typically, a marriage contract is drawn up by a family lawyer (usually one with experience in marriage contracts) in advance of marriage and outlines an agreement on matters such as:
Ownership in or division of property
Should the future spouses break up through a separation or divorce, a prenup or postnup agreement could protect significant assets one has brought into or earned separately during the marriage. This could help protect personal property and funds from unwanted division or being used to pay off joint liabilities.
Should the marriage end in divorce or separation, this contract could include how much spousal support one should receive. It can also address child support if the married couple has children.
The right to direct the education and moral training of their children
This marriage agreement could also include specifications on how the spouses’ children should be brought up morally and educationally. This may include certain values, beliefs, cultural practices, or particular schools and subjects the children should study.
Any other matter in the settlement of the spouses’ affairs.
A prenup could include the breakdown and division of marital responsibilities and assets such as bills, taxes, joint and personal bank accounts, fidelity, child care, etc.
What Cannot be Included in a Marriage Contract?
- Parenting time and decision-making responsibility (formerly child custody and access) terms: These are determined by provisions within the Family Law Act and must be centred around the best interests of the child. Attempts to circumnavigate the rules and procedures of the Family Law Act via a marriage contract will not be enforceable in court.
- Rights to the matrimonial home: Under the Family Law Act, both parties to a marriage have an equal right to live in the matrimonial home, and this cannot be altered with an agreement to the contrary Both parties will retain equal rights to remain in the home unless a separation agreement (signed by both parties) or court order for exclusive possession is obtained.
Myths and Realities of Prenuptial Agreements
Myth: Prenuptial agreements are only for the wealthy or privileged.
Reality: Prenuptial agreements are recommended for any couple considering marriage, so that they’ll be protected in the event of separation, divorce, or death.
Myth: Prenuptial agreements aren’t as binding as other types of legal contracts.
Reality: Prenuptial agreements have the same legal force and effect as other contracts.
Myth: You only need a prenuptial agreement if you’re about to get married.
Reality: You can enter a postnuptial agreement even after marriage, as long as both parties agree to the terms.
Myth: Prenuptial agreements spoil the romance.
Reality: Prenuptial agreements do not spoil the romance, they protect the couples’ best interests in the event of separation, divorce, or death.
Myth: Prenuptial agreements only apply to heterosexual couples.
Reality: Prenuptial agreements can be used by same-sex couples.
Can a Marriage Contract be Set Aside?
Marriage contracts can be set aside if certain factors are present. If any of the following situations apply, it may be possible to have the marriage agreement invalidated in court:
- One of the parties was placed under pressure or duress to sign;
- The contract is found to be unconscionable, or
- There was fraud or misrepresentation at the time of signing (such as a failure to properly disclose financial assets or debts).
If you have reason to believe your marriage contract should be voided, you must ask an appropriate court for an order to set the agreement aside. It is important to note that courts will rarely intervene unless one of the above factors is present.
Furthermore, if only one aspect of the agreement is found to be unfair, a judge may only set aside that specific term, allowing the rest of the contract to stand. Before proceeding with a challenge to a domestic contract in court, you should seek experienced legal advice to review the agreement and advise you of your options.
It is also important to note the 2-year limitation period for setting aside a marriage contract, as pointed out in the Ontario decision, F.K. v. E.A., 2019 ONSC 3707. The clock on the limitation period begins to run once a party discovers that the contract is unfair and that a legal proceeding is the most appropriate way to resolve the issue.
Enforcing a Marriage Contract
A domestic contract filed with the court will generally be enforced as written unless challenged by one of the parties. If a challenge occurs, the court will review the contents and determine if any of the voiding factors in the section above apply.
Further, if any of the terms contained in the agreement are found to violate the law, such as concerning child custody or the matrimonial home, those terms will likely be excluded from the agreement.
If none of the above applies, it is likely that the agreement will be enforced with the same veracity as a court order. It is imperative to have any domestic contract thoroughly reviewed by an experienced family law lawyer before signing to ensure your interests are fully protected.
Contact Our Family Lawyers for Assistance in Drafting Marriage Contracts
At Gelman & Associates, we can help you draft a marriage contract, or enforce a pre-existing agreement. Contact us today to learn how a marriage contract can help protect your rights and assets.
With six law offices conveniently located throughout Aurora, Barrie, Downtown Toronto, Mississauga, North York, and Scarborough, we are easily accessible by transit and off-highway. Call us at (844) 769-0737 or 1-844-769-0737 or contact us online for an initial confidential consultation.
A postnuptial agreement is simply a prenuptial agreement that is entered into after marriage and is usually exactly the same as a prenuptial agreement.
A prenuptial agreement is a marriage or domestic contract made prior to the marriage. Prenuptial agreements are primarily common among couples (either one or both parties) who have accumulated a substantial fortune or assets before entering into a marriage.
Suppose you are concerned about your assets in the event of a divorce, but you don’t have a prenup in place. In that case, you can protect your assets by getting a postnuptial agreement and keeping your own funds and real estate properties, which were acquired before the marriage, separate.
Yes. This marriage contract is called a postnuptial agreement and has similar functions to a prenup.
If the contract is signed before the marriage ceremony, it becomes effective as soon as the couple is legally wed. If it is signed after the wedding, it could be effective immediately.
To protect their legal rights, unmarried couples who intend to live together could enter a cohabitation agreement, which is similar in function to a marriage contract.