Family Law Agreements
A family law agreement — like a cohabitation agreement, a marriage agreement or a separation agreement — is a contract, just like the contract you might have with an employer or a landlord: each party promises to do something in exchange for something the other party promises to do, and both parties expect that they’ll be held responsible for fulfilling their promises. In family law, contracts like these are used to settle the issues that come up when a relationship ends, although cohabitation agreements and marriage agreements are sometimes also used to settle how to manage a relationship.
People who sign a family law agreement when they marry or plan to marry are entering into a marriage agreement, also called a pre-nuptial agreement. People who sign an agreement when they start living together or plan on living together are entering into a cohabitation agreement, also called a living-together agreement. Under the Family Law Act, most couples who live together for two years have the same rights on separation as couples who are married, so there is no significant difference between a marriage agreement and a cohabitation agreement. Many people make agreements that will be effective regardless of whether they are living together or married.
The usual point of agreements like these is to say what will happen if the relationship breaks down, although they can also talk about how things will be handled during the relationship or if one person dies during the relationship. The weird thing about marriage agreements and cohabitation agreements is that although they mostly talk about what will happen when a relationship ends, that may not happen for five years or 20 years, or it may never happen at all. As a result, it can be difficult to make plans based on what the family’s circumstances might be like at some unknown point in the future when the relationship ends.
Married spouses, unmarried spouses and other unmarried couples who enter into an agreement after their relationship has broken down are entering into a separation agreement. A separation agreement is a contract that describes how some or all of the legal issues arising from the end of the relationship have been resolved.
All of these different kinds of agreement are legal contracts that describe the parties’ rights and obligations towards one another. They can deal with everything from who gets to keep the Kenny G boxed CD set, to where the children will live, to how the parties will deal with their mutual friends, to who gets to keep the Ford Pinto. While these agreements are usually all-inclusive, they don’t have to be; some issues can be left aside for the courts to deal with. A couple might sign a property agreement dealing with just property issues, or a parenting agreement dealing with just the care of the children when their relationship has ended.
Despite the intentions of the couple when they signed an agreement, the terms of their agreement may still wind up being reviewed by the court, and possibly changed, if one of the parties later has a problem with the agreement. While the court will pay a great deal of respect to any written agreement, if an agreement was unfairly negotiated, is significantly unfair or becomes significantly unfair the court will generally be willing to look into things and perhaps set aside the agreement and make an order on different terms.
The Family Law Act encourages people to make agreements resolving their disputes rather than going to court. Section 6 of the act says this:
(1) Subject to this Act, 2 or more persons may make an agreement
(a) to resolve a family law dispute, or
(i) a matter that may be the subject of a family law dispute in the future,
(ii) the means of resolving a family law dispute or a matter that may be the subject of a family law dispute in the future, including the type of family dispute resolution to be used, or
(iii) the implementation of an agreement or order.
(2) A single agreement may be made respecting one or more matters.
(3) Subject to this Act, an agreement respecting a family law dispute is binding on the parties.
Under s. 214 of the act, the court may:
- set aside part of an agreement, without changing the rest of the agreement,
- incorporate all or part of an agreement into an order, or,
- make an order replacing all or part of an agreement.
The test the court must apply in deciding whether to set aside an agreement changes depending on the subject matter of the particular part of the agreement at issue. Some tests, like the test to make a child support order in place of an agreement on child support, are really easy; others, like the test to set aside an agreement on property division, are really hard. If you’re asking the court to set aside an agreement, you must read the parts of the Family Law Act that deal with setting aside agreements.
The role of family law agreements
The fundamental purpose of all family law agreements is to settle an issue that has come up, or one that could come up, and might be the subject of a legal dispute.
It is almost always better to settle a dispute yourself rather than have the courts resolve your problem for you. It is usually cheaper to settle a dispute rather than take it to court, and negotiated settlements usually give you the best possible chance of maintaining a halfway decent relationship with each other in the future. Family law agreements also give you an incredibly flexible way of resolving your dispute. Your agreement can be tailored to suit your particular circumstances and needs, and can be far more creative in resolving a problem than a court order ever could be.
Marriage and cohabitation agreements
Marriage agreements and cohabitation agreements usually talk about what will happen if the parties’ relationship breaks down, although they can sometimes talk about how things will be handled during the relationship. These sorts of agreements are normally made well before the parties marry or begin to live together, but can be made at any time during the parties’ relationship.
It is important to know that you do not have to enter into a marriage or cohabitation agreement just because your partner wants you to, or just because you’re about to marry or start living with someone. While your partner may want you to sign an agreement, you are under no legal obligation to do so. With or without a family law agreement, remedies are almost always available under the common law, the Divorce Act, or the Family Law Act if problems crop up later on.
Marriage agreements and cohabitation agreements aren’t always appropriate. Most people who enter into these agreements have been married before (once bitten, twice shy!), are coming into the relationship with children, are coming into the relationship with significant assets or significant debts, or expect to receive significant assets during the relationship. A young couple who have no significant assets or debts and no children don’t necessarily have any particular need to sign a marriage agreement or a cohabitation agreement.
During the relationship
The sorts of terms people want to apply during their relationships are most often financial. That being said, family law agreements are incredibly flexible and can require the parties to do anything imaginable, from caring for the children during the workweek, to having a certain number of holidays each year, to always wearing purple shirts on Thursdays, to sharing the household chores. Typically, however, people want to address issues like these:
- How will a joint bank account be managed? Will the parties contribute a fixed monthly amount to the joint account?
- How will common household expenses be shared? Will specific bills be paid by a specific party or will they be shared proportionately to the parties’ incomes?
- How will unexpected expenses be paid for? Will both parties pay for household repairs?
- How will savings, RESPs, RRSPs and retirement funds be managed? Will each party be required to contribute a fixed monthly amount?
- How will each party‘s income during the relationship be handled? What will happen if someone gets an unexpected windfall, like a lottery win or an inheritance?
Some agreements do not deal with these issues, and some paint only a vague picture of the parties’ respective financial responsibilities. Other agreements are mind-bogglingly detailed and cover even the tiniest details. In my view, unless someone is spectacularly anal retentive, the less said in a marriage agreement or cohabitation agreement about how a relationship will be managed, the better. You wouldn’t want every aspect of your relationship governed by a legal contract ― that’s exactly the sort of thing that encourages relationship breakdown.
After the relationship
The most common reason why people enter into a marriage agreement or a cohabitation agreement is to specify how property will be dealt with if the relationship comes to an end, although agreements like these can also deal with the payment or waiver of spousal support. Typically, however, these sorts of agreements just try to preserve a party‘s interest in an asset after the relationship has ended.
Agreements about the care of children or the payment of child support are only binding if they are made after separation or when the parties are about to separate.
Separation agreements are entered into after a relationship has broken down. There is no need for the parties to have moved out or gotten a divorce when the agreement is made; in fact, when a couple is married it’s usually best to deal with the separation agreement before you apply for a divorce, just in case you can’t reach an agreement.
Separation agreements are always the product of negotiations between the parties and, hopefully, their lawyers. The goal of a separation agreement is to deal with all or some of the issues related to the separation in a way that both parties are as happy with as possible. Separation agreements usually deal with the following issues:
- How will the children be cared for? How will important parenting decisions about the children be made?
- If the children will be living mostly with one parent, how much time with the children will the other parent have?
- How much child support be paid, and which of the children’s expenses will be shared between the parents?
- Should a party receive spousal support? If so, how much support should be paid and for how long?
- How will the family property be divided? Should the parties’ excluded property be divided?
- How will the family debt be divided?
Separation agreements can cover everything that is a problem for a couple, even things that the court would not ordinarily deal with or be able to deal with.
Separation agreements are binding from the moment they are signed by both parties unless the agreement says something different. They operate from the time they are made and, where children, child support, or spousal support are issues, they often continue to operate indefinitely into the future. Theoretically, a separation agreement will be binding on the parties until they die. In practice, however, most people stop relying on the agreement once the children have grown up, left home and become independent, even though their agreement continues to be legally binding on them.