The Family Law Act provides the technical requirements for all Domestic Contracts. There are a number of different types of Domestic Contracts and each serves a different purpose. Parties can choose to resolve the issues surrounding the breakdown of their relationship through the use negotiation and mediation of a Separation Agreement which can reflect agreements on all or only some outstanding issues as opposed to starting a court action and asking a judge to decide their issues. Marriage Contracts and Cohabitation Agreements are to set out how individuals wish to arrange their affairs during their marriage or cohabitation.
As required by the Family Law Act, in order for any Domestic Contract to be considered legally valid in Ontario, it must be entered into voluntarily, be in writing, be signed by both parties and be witnessed. Generally, each person entering into a Domestic Contract must exchange financial disclosure regarding their debts and assets. It is also important to note that that each person entering into a Domestic Contract must obtain Independent Legal Advice.
Cohabitation Agreements and Marriage Contracts
It is often helpful for individuals hoping to cohabitate to outline the rights and obligations that each would have in the event of a breakdown of their relationship. Outlining such rights and obligations at the outset of cohabitation can help minimize time, stress and costs in the event that these issues have to be dealt with at a later time.
Most frequently, a Cohabitation Agreement covers the issues of division of property and spousal support but, just like any other Agreement, it is up to the parties themselves to determine what specific rights and obligations they would like to have outlined in their Agreement.
In the event that the parties marry subsequent to the signing of the Cohabitation Agreement, the Cohabitation Agreement will generally become a Marriage Contract. A Marriage Contract (Prenuptial Agreement) is similar in many respects to a Cohabitation Agreement, but it is entered into prior to the parties marrying.
Both a Cohabitation Agreement and Marriage Contract may be used to vary the application of the law as reflected in the Family Law Act. In general, the parties may choose to include whatever terms and/or conditions they would like in their Agreements but there are some limitations. For example, as a general rule, issues relating to child support, custody, and access should not be limited in a Domestic Contract. Generally, such issues can only be dealt with in a Separation Agreement.
Separation Agreements are entered into after the parties have separated (or have decided to separate), and generally deal with the issues of property division, support (child and spousal), custody, and access. The same technical requirements that apply to Cohabitation Agreements generally apply to Separation Agreements (it must be entered into voluntarily, be in writing, signed by both parties, and witnessed). The requirement of Independent Legal Advice also applies and each party must also exchange financial disclosure prior to completing a Separation Agreement.
Parenting issues are often addressed in Separation Agreements but there may be instances where the parties would like to set forth a separate Parenting Agreement outlining their specific parenting arrangements (such as custody and a detailed access schedule). A Parenting Agreement may also include provisions for the child(ren) to travel or boundaries/limitations for cases in which the custodial parent wishes to relocate with the child(ren). Outlining such issues can help save time, expenses, and stress.