Why Cohabitation Agreements Matter in Alberta
What is a Cohabitation Agreement?
A cohabitation agreement is a written contract between two people who live together in a relationship but are not married. In Alberta, these types of agreements are governed by contract law and will generally outline how property, debts, support and other financial responsibilities will be handled at the termination of the relationship. At OP Lawyers LLP, our Calgary Family Lawyers understand the uncertainties of cohabitation and can provide guidance and clarity with respect to your rights in the event of separation.
Why you should have a Cohabitation Agreement?
While the Family Property Act (effective January 2020) extended property-division rules to adult interdependent partners (AIPs), there are still gaps and uncertainties. A cohabitation agreement gives clarity and security to both partners by setting expectations in advance.
Key benefits can include:
- Defining ownership of assets (for example, a house purchased before the relationship)
- Establishing how household expenses will be shared
- Clarifying how debts will be managed
- Property division after separation
- Setting out what happens to property if the relationship ends or one partner passes away
- Determining how assets obtained through the relationship will be divided
- Structuring ownership of assets (joint tenants vs tenants in common)
- Exempting gifts, inheritances etc., including any value increase
- Defining tracing rules if exemptions are mixed into joint assets
- Partner support obligations
Enforceability in Alberta
For a cohabitation agreement to be enforceable in Alberta, it must be properly executed with specific requirements. This typically requires:
- Financial disclosure by both parties
- Independent legal advice for each partner (meaning both parties must retain separate lawyers)
- A written agreement signed and witnessed with their respective counsel, including certificates of independent legal advice
Without these steps, the agreements could potentially be challenged in court.
What Happens Without an Agreement
If there is no cohabitation agreement and the relationship ends, property and debts will generally be divided under the Family Property Act. This may result in outcomes neither party anticipated, especially if one partner contributed more financially while the other contributed more through non-financial means (such as homemaking or caregiving). More importantly, the parties may face unintended support obligations, including adult interdependent partner support. More importantly, if a couple is found to be in an adult interdependent partnership (common law), all property or assets obtained during the relationship may be divided equally as per the Family Property Act.
Conclusion
A cohabitation agreement is not about mistrust; it’s about clarity and fairness. By addressing financial and property issues early, couples can reduce conflict and uncertainty. By putting expectations in writing now, couples can avoid costly disputes later and focus on building their partnership with peace of mind.
Disclaimer: This blog post is intended for informational purposes only and does not constitute legal advice. For advice specific to your circumstances, please consult a qualified family lawyer at OP Lawyers LLP in Calgary or another legal professional.