What is a Prenuptial or a Cohabitation Agreement?

Cohabitation and Prenuptial Agreements are used in different legal contexts but serve the same purpose.  They each define legally enforceable ‘rules’ a couple want to apply to their unmarried cohabitation or to their marriage.  They provide a much higher level of certainty over outcomes if a couple later separates.  In that sense these agreements can save the parties much of the time, legal expense and stress that may arise after a separation.  These agreements can also clarify the nature of the couple’s financial and legal relationship while they are together.  They also serve an important educational purpose, informing couples of the legal frameworks that apply to them, at a time when they can actually still exert some control over those rules.  A proper Prenuptial or Cohabitation Agreement must be tailored to the particular couple.  It should never be a ‘boilerplate’ document.

Why Would I Want a Cohabitation or Prenuptial Agreement?

Cohabitation and Prenuptial Agreements are written in the context of the government legislation and judge-made law that applies to the parties. For couples marrying, their Prenuptial Agreement will only be enforceable once they marry. For couples not planning to marry, their Cohabitation Agreement will be enforceable as soon as they both sign it, and its terms can address periods of cohabitation before and after the Agreement is signed. These agreements often modify or waive important parts of the background ‘default’ law, tailored to the couple’s wishes, goals or values.  

In no particular order, issues touched on by these agreements can include:

• Clarifying what assets or debts an individual has or brings into the relationship, and how those will be kept separate and/or accounted for going forward;
• Defining what aspects of the applicable law will be modified or even waived by the agreement going forward, or in the case of a Prenuptial Agreement, once the parties marry;
• In appropriate contexts, defining in advance the parties’ expectations for spousal support in the event of separation;
• Defining the rules for new property and debts acquired by either of the parties during their cohabitation or marriage;
• Clarifying in advance the parties’ financial relationship and expectations while they are together;
• Issues around the parenting and support of children are almost never included in such agreements. Those issues must be determined according to the best interests of the children, which are not possible to know or define in advance. It is also not possible to contract out of obligations for the financial support of children.

A Prenuptial or Cohabitation Agreement is a complex, individualized and important legal document.  It may be enforced after a decades long marriage or cohabitation.  It ultimately exists to avoid future problems by providing greater certainty.  It gives a couple a high level of control over the legal aspects of their relationship, rather than simply allowing the ‘default’ law to apply.  It should provide a couple with a legally enforceable framework for the financial aspects of their relationship, specifically tailored by and for them.