Now that Valentine’s Day has come and gone, I would like to delve into the very unromantic subject of Cohabitation Agreements. Last month, I talked about whether living together before marriage will save you money. In Canada, most people would assume (well, I did, anyway!) that if you live common law, you are entitled to the same property rights and division of assets the same as if you were married. If a marriage breaks up, one generally speaking is entitled to 50% of the others’ assets under the Family Relations Act. Everything is split 50/50 equally. For common law, I thought that if you lived, let’s say, 2 years together and somehow things really just don’t work out, you would be entitled to 50% of each other’s assets, right? WRONG.
The justice system doesn’t treat it like that.
Now I’m not a family lawyer or anything, but the Canadian family law system tells us that for common law arrangements, if you don’t have documentation or a paper trail that you have contributed to rent or a mortgage (or if your name isn’t even on the title of the home), you’re really sh*t out of luck. You’ll get none of it. Zilch. Nada.
So when you move in together, it’s really important to either a) keep all your receipts and make sure that if you’re paying into the mortgage, that your name is on the mortgage and b) you have a good sit down talk about your assets and what you want to do with them in case you break up.
I know talking about the possibility of breaking up is about as romantic as dissecting a cow’s eyeball in Biology lab (mmm formaldehyde, anyone?), but it’s necessary to at least get a sense of what you both want to do if you are faced with a break up.
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