The pending nuptials of Prince William and Kate Middleton have attracted an inordinate amount of public attention. We all seem to be captivated by royalty (whether it be political, sports, entertainment, or the real thing!).
There are some ‘gossipy’ rumors circulating that Prince William and Kate have agreed to enter into a marriage contract that presumably would establish what payments or property transfers would be made if the couple ever separated or divorced. I am no expert on “royalty law” but I am given to understand that there may be some question about the legality or enforceability of a marriage contract entered into by a member of a royal family. Fortunately for you (and me) this is not the type of question that I am asked every day in my family law practice. There aren’t very many royals in my ’neck of the woods’.
That said, there is an increasing use of cohabitation agreements and marriage contracts between persons contemplating a long term relationship or marriage. More frequently, people are waiting longer to get married and they are coming into the new relationship or marriage with a more significant asset base and thus they want to protect what they have in the event of a separation. Also, people entering into (what they hope will be) long term relationships or marriages have witnessed their own parents separations and want to avoid the hardship and fighting that they observed in their own parents’ separation.
When I discuss the wisdom of a marriage contract or cohabitation agreement with a client, I describe it much like an “insurance policy” – it is something you should have; but hope to never use . It is only relevant in the event of a separation and it is designed to govern what is to happen with respect to the division of property (or a payment in respect of property) and spousal support (alimony in some jurisdictions).
A Cohabitation Agreement (in the case of common-law spouses) or a Marriage Contract (in the case of married spouses) assist separating spouses in determining such things as:
- The ownership of various properties upon separation (not just land, but also such items as bank accounts, investments, jewelry, vehicles, time-share vacation properties. The exception to this is that rights with respect to occupation of the “matrimonial home” cannot be bargained away in a Marriage Contract.
- Which spouse will be responsible for the various debts that exist at the time of separation
- How jointly owned property will be handled – if one or both spouses wish to buy the other spouse’s interest in a jointly owned house, cottage, etc.
- If spousal support will be paid (or not) and if so, for how long and in what amount
- The rights to determine the educational and religious training of the children
One of the issues that cannot be addressed in a Cohabitation Agreement or Marriage Contract is the custody of children of the relationship in the event of a separation. Custody of children is always based on the “best interests of the children”. It is difficult to predict a child’s best interests at some time in the future (separation) at the time of negotiation of the Cohabitation Agreement or Marriage Contract.
In Ontario the statutory requirements for a valid Marriage Contract or Cohabitation Agreement are set out in the Family Law Act and are:
- There must be full (meaningful) disclosure between the parties regarding their financial circumstances at the time of entering into the agreement;
- Each party must have the opportunity to receive independent legal advice about the agreement
- The agreement/contract must be in writing and the parties’ signatures must be witnessed
I am confident that Prince William and Kate Middleton will have no shortage of high quality advice (legal and otherwise). For those of us non-royals, I would consider investing some time and money on carefully considering what you would like to see in place in the event of a separation.