By: Vanessa Park
As more people settle down later in life, this question becomes increasingly important. Why? Because they are more likely to have acquired assets and/or have a clearer picture of their earning potential compared to five or ten years ago.
Before you broach this subject with your partner, it may help to know a little about the Family Law Act and what you can expect from a standard cohabitation or marriage agreement.
Important things to know about the Family Law Act:
• your partner is your spouse if: (a) you are married, or (b) you have lived together in a marriage-like relationship for at least two years;
• on separation, your spouse is generally entitled to half of all family property and equally responsible for all family debt, regardless of his or her use or contribution;
• family property is property that is owned by at least one spouse on separation;
• property acquired before the relationship is excluded, but any increase in value during the relationship is family property; and
• if you earn more money than your spouse, he or she may be entitled to spousal support on separation.
Common terms in a Cohabitation or Marriage Agreement:
• all property owned before cohabitation or marriage is separate property (not family property), including any increase in value;
• any property acquired during cohabitation or marriage is also separate property unless it is registered in both of your names or you have a written agreement stating that it is family property;
• ownership of family property is not equal (for example, you can specify that it is owned in the same proportion as the contribution made by each of you);
• you and your spouse are each entirely responsible for your own debts; and
• no spousal support be paid.
The time and money spent negotiating a good Cohabitation or Marriage Agreement are almost always significantly less than what you would spend dealing with the same issues after separation. Also, it may not be a bad idea to sit down with your partner and discuss how you want to deal with property and finances prior to cohabitation or marriage.
Whether you have just started to think about whether this is right for you or you have made up your mind to have a Cohabitation or Marriage Agreement, our lawyers at Hart Legal are happy to assist you.