Cohabitation agreements are becoming more and more significant as unmarried couples who reside together do not benefit from the property division provisions in the Family Law Act.
While only married couples are entitled to equalization of family property under the Family Law Act, the division of property for unmarried couples is determined through equitable principles of ownership. An unmarried spouse is entitled to property registered in their name, unless the non-titled spouse can prove that such property is being held in trust for them. This can be achieved through a resulting trust or constructive trust.
A resulting or presumptive trust presumes that a person who places property in the name of another intends that person to hold the property in trust for the donor. The more common and more recent equitable principle with respect to property is the constructive trust. The constructive trust is created in favour of the party who is not on title, but rather contributed work or money to the acquisition, preservation or maintenance of the property. A stay at home mom, who continued to the upkeep and maintenance of the household is an example of someone who may be entitled to a constructive trust.
To achieve such property rights is not easy, and usually requires court proceedings. That is why cohabitation agreements are very important. A cohabitation agreement can determine the rights each party has in the other’s property interest. Cohabitation agreements can also deal with dividing the estate upon death and spousal support obligations.
If you are concerned about your spousal and property rights as a common law spouse, please do not hesitate to contact our office: 416-924-5969
