British Columbia's new Family Law Act comes into force on March 18, 2013. From this day on, couples who are not married but “cohabiting” or in a “marriage-like” relationship will have rights to each other’s assets. This is a dramatic change from the law we have now, where only married couples could make a claim to each other’s assets purely based on the relationship.
So what does it mean to “cohabit” or be in a “marriage-like” relationship? Often – especially after a break-up – one person will claim they were cohabiting, while the other says they were not. The top three attempts to explain away the relationship are these:
We were only dating and had separate residences;
She was my housekeeper or caregiver; or
We were roommates, not a serious couple.
Traditionally, people married, lived in the same house, had children and owned assets jointly. These days, married couples may live in different homes, often in different countries, and have no children. If married couples don’t need to live in the same home or country to be considered married, why would unmarried couples need to do so in order to be considered “cohabiting” or be in a “marriage-like” relationship? The fact is that they do not. Clients have been found to be cohabiting even when one hasn’t even been to the other person’s residence in another country.
What does it mean for an unmarried couple to be “cohabiting” or in a “marriage-like” relationship? There isn’t a definitive list because everyone’s situation is different. Some couples have children, others do not. Some have sexual relations, others do not. Some share assets, others do not. Some have joint bank accounts, others do not. Whether an unmarried couple is found to be cohabiting depends on many factors.
The courts will be concerned with the couple’s intention. Did the couple intend the relationship to be “marriage-like”? How did they describe themselves to the outside world? Did they tell the government the other person was their spouse for tax purposes or on insurance forms? Did they share money or merge assets and income? Was one person paying for the other’s expenses?
In determining whether the relationship was “marriage-like,” the court will look at how similar the cohabiting relationship is to a “marriage-like” relationship.
Whether someone is cohabiting isn’t a question confined to younger people – who sometimes live together out of convenience or start off as roommates. I’ve had cases where widows or widowers start relationships with other people, both keep their own places, but spend a lot of time at the other person’s apartment. Then, claims are made (sometimes after one person has died by the other wanting a share of the estate) that they were cohabiting spouses.
Those with assets and income to protect should consider entering into a cohabitation agreement with the other person to set out clearly in a written contract how assets will be divided if the relationship ends. The agreement might also address whether spousal support payments will be made. These contracts are along the same lines as pre-nuptial agreements between people about to get married. These types of agreements can be signed after a couple is already cohabiting. It is often easier and more palatable if the agreement is drafted and signed before there is any question that a couple is cohabiting, just as it is preferable to enter into a “pre-nup” before the marriage, instead of after the wedding.
The above are generalities and only represent some of the changes to the law coming on March 18. There are many exceptions and nuances in the law and the above is not meant to constitute legal advice. Please consult with a family lawyer for advice on your particular circumstances.