There are important differences between the rights of married spouses and the rights of common law spouses when it comes to handling property when the relationship breaks down.
In this context, property does not simply refer to real estate property such as a home, but refers to all of the parties’ assets, including vehicles, household items, bank and investment accounts, businesses, and even employment pensions.
On separation or divorce, married spouses may retain ownership of the property they own, but their respective rights and obligations are such that they have the right to share in the value of property acquired during marriage. There is no similar automatic right to divide property or share in the value of accumulated property for common law spouses.
For common law spouses, rights to property are determined by ownership. In other words, the person whose name is on the property is deemed to own it. The only way for a non-owning common law spouse to obtain ownership of property not in their name is to bring a trust or unjust enrichment claim, an expensive process that is not guaranteed success.
Rights in relation to the family residence are also different for married and common law spouses. There are special rights attached to the residence which is the matrimonial home. For married individuals, each spouse has an equal right to remain in the matrimonial home until it is sold, until there is a court order dealing with the home, or until an agreement is reached stating otherwise. In addition, neither spouse can sell or mortgage the matrimonial home without the written consent of the other spouse. This is the case even if the home is registered solely in one spouse’s name.
Common law spouses are not similarly protected. There is no matrimonial home in the case of an unmarried couple and, as a result, there are no special rights that go along with that. Each case is different and the facts of the case will determine how reasonable it is for a non-owning spouse to advance a claim to share in the property.
Common law spouses can avoid unexpected problems by knowing their rights and obligations and perhaps by entering into a Cohabitation Agreement.
For more information or for assistance in obtaining a Cohabitation Agreement, please contact SMG and consult one of our family law lawyers.