Pre-nuptials Are Not Only For Celebrities

Are you contemplating getting married but want to ensure that your assets are protected in the event of a future separation from your new spouse? Although it may be difficult to discuss the idea of a marriage agreement, commonly referred to as a pre-nuptial agreement, with your soon-to-be bride or groom, doing so may prevent potential disputes over your property and the associated stress and cost in the future and may give you some peace of mind going into your new marriage.

A marriage agreement is an agreement made between spouses at the beginning of or during a marriage.  These agreements may address matters arising during the marriage, but are more frequently intended to resolve issues arising in the event of marriage breakdown.  Entering into a marriage agreement allows the parties to agree to how their assets and debts will be managed during the marriage and to how they will be divided in the event of separation, such that the parties can agree to contract out of the statutory provisions in the Family Relations Act which otherwise govern the division of assets upon marriage breakdown.

To be a valid marriage agreement, the agreement must be in writing, signed by both parties and witnessed.  However, a marriage agreement is never absolute as the courts retain the discretion to vary it in the interest of fairness.  For this reason, it is very important that the parties each fully disclose their relevant financial circumstances concerning their assets, liabilities, income and expenses to the other party before the agreement is entered into and that the agreement is drafted to adequately address the parties’ needs and interests based on their particular situation. 

Parties who are living together in a common law relationship may, in certain situations, also want to enter into a cohabitation agreement, which is similar in nature to a marriage agreement.  However, as there is no presumption in favour of the division of assets of common law couples and as cohabitation agreements are also subject to variation by the courts on the ground of unfairness, it is not always advisable to enter into a cohabitation agreement and the parties should obtain legal advice prior to doing so. 

For additional information on this topic contact Pushor Mitchell Associate Ashleigh Baylis at:
baylis@pushormitchell.com or (250) 869-1225