There are a number of reasons why a couple might want to enter into different types of agreements when entering into marriage or cohabitation. Oftentimes, a couple might enter into a cohabitation agreement when they start living together but are not, or do not intend to get, married. If a couple plans to marry they may decide to sign a prenuptial agreement, also known as a “prenup.” Both of these contracts could lay out the terms of what would happen to the parties’ personal and shared property as well as issues concerning spousal or child support. Following the breakdown of a relationship, either through separation or divorce, couples can sign separation agreements, which address the same types of issues after a relationship has ended, and ideally, with little litigation. But what happens to these agreements when a relationship resumes and then ends again? Are the contracts still valid? This was discussed in a recent decision from the Court of Appeal for Ontario.
Couple separates and then gets back together
The parties were involved in an on-again-off-again relationship that began in 2006. They separated numerous times from a period beginning in 2006 and ending in 2013. During this time the wife’s mother purchased a home for her. In 2013 the parties began to live together and entered into a cohabitation agreement. Shortly after signing the agreement, the wife moved out of the home, and he paid her $5,000 pursuant to the agreement for vacant possession of the home.
However, the parties’ separation was not permanent. They reconciled in early 2014 and were married by June of that year. The wife moved back into the husband’s home and they discussed adding her to its title, but it never came to fruition.
The couple eventually separated for good in January 2019.
Is the cohabitation agreement still in place?
At trial, the judge agreed with the wife’s position that the cohabitation agreement signed by the parties was of no force or effect for three reasons:
- The common law principle holding that reconciliation terminated a separation agreement applied to cohabitation agreements.
- The discussion about transferring title to the matrimonial home to the (wife) in 2016 showed that the parties did not subjectively intend that their cohabitation agreement would continue to apply in the event of a separation and reconciliation. This was, he held, “sufficient to rebut any presumption to the contrary.” The motion judge went on to note that nothing in the agreed facts supported an intention that the agreement would be applicable if there was a reconciliation, and nothing in the agreement expressly dealt with the effects of a separation and reconciliation.
- The cohabitation agreement provided that upon breakdown of the relationship, the (wife) would vacate the home owned by the (husband) which the parties were then occupying as their home on 30 days’ written notice and upon payment by the (husband) to the respondent of $5,000 payable on the date she left the property. The motion judge held that the consideration for the $5,000 payment was the (wife’s) relocation from the matrimonial home and that, since that triggering event had occurred and payment made, the terms of the cohabitation agreement were exhausted.
On appeal, however, the court determined that a cohabitation agreement does not necessarily cease to apply unless there is an agreement that calls for it to be set aside. While it’s true that a separation agreement becomes void upon reconciliation, the same does not apply to cohabitation agreements. While there could be cases where a cohabitation agreement would cease to be in effect, the parties need to expressly state that intent in the agreement.
As a result, the terms of the cohabitation agreement were still in place.
At Johnson Miller Family Lawyers in Windsor, we provide knowledgeable advice and skilled representation to separated spouses and families in Ontario. With more than 25 years of experience helping clients with all types of family issues, from divorce to custody, we can help guide you through the process of amending the terms of your separation agreement and resolving related issues. Call us at 519.973.1500, get started now or contact us online.