Living Together Does Not Equal Marriage
The only real difference between living together and being married is a piece of paper – right?!
Although the number of couples who are living together is on the rise, they do not always benefit from the same rights as those who are legally wed. There is a misconception that once you have lived together for a certain number of years, the law treats you as though you are married. In fact there is no one magic number. Instead each area, from taxes, to support, to death, has its own distinct set of rules.
The following are instances where the two types of couples are treated differently and in some cases very differently.
Your Home
Under the Family Law Act, the property that is occupied as the family residence, is considered the matrimonial home and as such, both spouses have an equal right to possession of it. This is so even if the house belongs to only one of the parties.
This concept of matrimonial home does not apply to unmarried couples.
Your Property
A person’s net family property is the value, at the date of separation, of all property he or she acquired during the marriage less debts, liabilities, the value of property owned prior to the marriage, gifts from third parties and inheritances. Following the breakdown of the marriage, the spouse, whose net family property is the lesser of the two, is entitled to one-half the difference between them.
This concept of net family property does not apply to unmarried couples. The fact that two people lived together, even for an extended period, does not automatically entitle one partner to a share of the other’s property. Although one partner may be able to argue that he or she is entitled to a fair share of the property that was accumulated during the relationship, this argument is a difficult one to make and can be very expensive to prove. (The different treatment afforded unmarried couples has been challenged as being unconstitutional. This issue should be heard by the Supreme Court of Canada this year.)
Breakdown of the Relationship
When a marriage breaks down, there are a number of laws, including the Divorce Act and the Family Law Act, that govern the dissolution. The same cannot be said for the demise of a common law relationship. This lack of legal intervention can have harsh consequences to one or both of the parties.
Spousal Support
Although divorce automatically raises the issue of spousal support, a common law couple must have lived together for at least three years (unless they have a child together and had a relationship of some permanence) to be legally entitled to ask the other for support.
Unlike married spouses, an application for support by a common law partner must be brought within two years of the end of the relationship.
Tax Laws
Although Revenue Canada recognizes common law relationships and extends to unmarried couples the same rights as married couples (e.g., spousal credits, tax-free spousal rollovers of RRSPs), these rights do not kick in until the parties have lived together for at least 12 months.
The Courts
Under the Canada Evidence Act, a married spouse, who is called to testify, cannot be compelled to disclose marital communications. This same right does not extend to common law couples.
Death
If a person dies without a will, the law provides a formula for dividing the deceased’s estate. If the deceased leaves behind a spouse, the first $200,000 will go to that person. The remainder of the estate will then be divided amongst the spouse and any surviving children. However, if the deceased was not legally wed to his or her partner, then the formula dictates that everything goes to any surviving children and if there are none, then to the deceased’s parents and so on. A common law partner is not on the list of beneficiaries and the best that he or she can do is to make an application to the court for support.
When a person marries, his or her will is revoked. As a result the new spouse will be entitled to a portion of the other’s estate. However, this is not the case when the couple simply live common law.
As evidenced by the above, moving in together is much more involved than simply deciding to share the rent. The consequences can be quite disastrous if one operates under the assumption that once a couple has lived together for X number of years the law considers them married.
One way to address many of these issues, aside from a wedding, is to enter into a cohabitation agreement with your partner and to draw up wills. If you would like further information regarding your particular situation contact Nicola Savin or Jacqueline Peeters.
Please visit our Family Law specialty site at www.familylawtoronto.ca
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