I drive by at least two wedding stores on my way into work in the morning and I love to look at the pretty dresses. The sparkle holds promises of wonderful things to come and the little bridesmaids dresses make me think of little additions to the family. What I usually don’t think of during that time is what is going to happen if the relationship goes south. Statistics still suggest that at least 50% (actually more but I don’t want to rain on anyone’s parade) will not work out.
People have their own opinions about whether or not planning for the break up of a relationship is bad luck or good sense. I am of the second group. However, not because I’m a lawyer and therefore programmed to think the worst, but also because I do believe and have seen that talking about these things at the beginning of a relationship make an already strong relationship stronger. It takes out any fear or uncertainty that either side may have and clearly sets out the expectations of both parties. If a relationship can’t handle that – well maybe it’s not ready for marriage?
First of all – before we go any further – I need to clarify something. We still fly the Maple Leaf on our flag poles as opposed to the Stars and Stripes, so we deal with cohabitation agreements or marriage agreements – not prenups!
A cohabitation agreement is obviously an agreement that two people enter into when they are considering living together. It would govern how they would deal with financial matters and other matters during the period of time that they are living together and would contemplate what would happen if the relationship ended. A cohabitation agreement can become a marriage agreement if the parties then decide to marry. As lawyers we generally put terminology in allowing for this.
A marriage agreement is an agreement that two people enter into before or after they marry. It governs how they are going to govern themselves during the marriage and considers what would happen if the marriage were to end.
For the most part, both agreements can deal with the same things: how money is going to be dealt with during the relationship, how property that one person has pre-relationship is going to be dealt with, how any property accumulated during the relationship will be divided and what support would be paid from one party to another. The scope of the agreement is only governed by the creativity of the drafter (and good legal sense). However these agreements are so flexible that they can even consider who will get custody of the animals!
The Family Law Act (which is the governing family legislation in British Columbia) specifically allows for parties to enter into agreements dealing with support and property. The courts will uphold these types of agreements provided that when the parties entered into the agreement:
a. both parties appropriately disclosed what their financial circumstances were;
b. neither party was vulnerable and the other took advantage of that (either due to the party’s ignorance, distress or need);
c. both parties understood the nature and consequence of the agreement that they were entering into; and
d. there were no other circumstances in place that would have deemed the contract to be void.
All of this can be confirmed by having each party take the agreement to different lawyers and get a certificate of independent legal advice signed at the same time that they sign the marriage agreement or cohabitation agreement. This then serves to confirm to the court that both parties understood what they were signing, had made the appropriate disclosure and there was no duress. For the cost of the independent legal advice (usually two hours of a lawyer’s time) you can save thousands in legal fees if the agreement is ever brought to court.
When clients sit across from me at the break down of the relationship, their biggest fear is the unknown. Having a marriage agreement or cohabitation agreement takes some of that unknown out of the picture. And as we begin to marry later in life or for multiple times – we see more and more brides and bridegrooms coming into relationships with assets that they want to protect. It only makes sense that while you are discussing what your colour schemes are and where to sit great aunt Edna that you also speak about what you both believe should happen to the family home if you ever split.
If you have questions on what to put in these agreements or even how to start the conversation with your spouse – call us. We can help.