Marriage is a pivotal moment in one’s life. It’s a big commitment, but it does not have to be complicated. A marriage contract is one way to ensure your rights are protected and your responsibilities are clearly defined before you head to the altar.
A marriage contract is a legal document – sometimes called a prenuptial agreement – that outlines the rights and responsibilities of married couples. In Ontario, it is governed by the Family Law Act.
While optional, it is a way to protect you and your assets should the marriage end in divorce or the death of your partner.
Benefits of a marriage contract
A marriage contract lets you specify who will own what, how property will be divided, and whether spousal support payments will be waived in case of a divorce.
Without one, any property will be divided according to the laws of your province, and depending on the situation, you might end up paying more or losing out if you’re not prepared.
In Ontario, when a couple gets married, it is viewed as an economic partnership where both have contributed financially and in other ways to the relationship.
If you get a divorce in Ontario, the value of your property and the amount it has appreciated will be subject to equalization outlined in the Family Law Act of Ontario. This means that even if you are entitled to retain your property, you will have to share any rise in value throughout the marriage, regardless of whether it is under your name or paid for completely by you.
The spouse whose net worth is smaller is also entitled to “equalization payment,” which comprises half the difference between your and your partner’s net worth at the time of separation.
But if you had a marriage contract and discussed terms, you and your spouse could reduce equalization or waive it completely.
When is a marriage contract considered invalid?
When it comes to children from a marriage, a marriage contract cannot mandate custody or access to current or future children. Ultimately, the law will make this decision during separation while considering the child’s best interests. The law also takes precedence over a marital contract when it comes to child support.
Your marital home(s) may also be subject to additional legal constraints.
Many other factors can also make a marriage contract unenforceable. For instance, a marriage contract can be nullified if either of the parties failed to declare a major asset or debt when the agreement was made.
It can also be disregarded if one partner did not completely understand the terms or their consequences while signing it. Therefore, it’s important to ensure that both parties can seek independent legal counsel before signing.
Lastly, it can be nullified if one of the parties signed it under coercion or deception.
Why a lawyer is necessary to create a marriage contract
Preparing a marriage contract can be challenging, but don’t let that stop you from making one.
Ensure your marriage contract is fair and binding. You can’t just rely on online templates or books since there may be loopholes that could cost you in the end. An experienced marriage contract lawyer like Simple Divorce can ensure your contract meets the specified guidelines.
Legal disputes about divorce agreements can be very expensive, even more so when one party does not want to honor their end of the bargain or refuses to pay.
A marriage contract can be a way to ensure that your spouse is doing right by you in the eyes of the law. If you want to start drafting yours, contact a marriage contract lawyer in Toronto who knows how marriage contracts work and how to draft them.
