Prenuptial & Cohabitation Agreements
What Is A ‘Prenuptial Agreement’?
A Prenuptial Agreement (“Prenup”) is a contract between two future spouses that settles issues of property, debt division, spousal support, or any other matters you wish to make clarify in the event of a party’s death or divorce.
A Cohabitation Agreement (“Cohab”) is the same type of Agreement but designed for couples who intend to live together for a considerable time before deciding on whether to marry.
Entering a Prenup or Cohab provides parties the opportunity to plan for the unthinkable, which is often difficult but particularly important. Having a binding plan in the event of a divorce, usually saves spouses considerable stress and money because many important matters have already been decided, and they do not need to be mediated or litigated in the event of a separation or divorce. Moreover, it is much easier for most couples to make clear and fair decisions during this stage of their relationship rather than waiting until they are in conflict.
If you do not enter a prenup, you will be subject to the Divorce Act (Canada), The Family Law Act or the Family Property Act, and perhaps other legislation in your jurisdiction. In Alberta, for the most part, assets and debts accumulated during the marriage will be divided equally, save for exemptions which may apply (like gifts, inheritances, settlement payments, or windfalls). Just because you acquired an asset before you began your cohabitation or before marriage, does not mean it is exempt from division with your spouse. The increase in value of “pre-marriage assets” during your marriage may be subject to equal division as well. If you do not want the legislation of your jurisdiction to automatically apply to your marriage or relationship if there is no agreement to settle matters amicably, entering into a prenup is a way of contracting out of this framework.
The Prenup Process
Bringing up your desire to enter a Prenup or Cohab to your partner may be difficult. Some people relate entering into a marriage contract as a sign of distrust or doubts, therefore it may be beneficial to book an initial consultation with Seal at our Red Deer family law firm before discussing the matter with your partner so that you have an overview of the laws affecting you while you are not covered by a Prenup. If your partner is already on board with entering into a Prenup, take note that family lawyers Red Deer will only meet with one party to the agreement to protect your interests and to reduce the chances of the agreement being overturned.