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Living Common-Law (Part 3): Legal Rights Related To Property

This post is part III of a series in which we examine some of the basics that common-law couples need to know about their standing before the law. Every province has its own way of governing family relationships. In Ontario, married couples and cohabiting couples have drastically differing rights in a key area: division of property. Savvy, unmarried parties are wise to understand the rules - and to protect their financial interests well in advance of a potential separation.

No Equal Division

No matter how long a non-married couple have lived together in Ontario, the two parties do not enjoy the automatic right to split their assets and debts 50/50 as do their married counterparts. The law does not view cohabiting couples as being involved an equal partnership.

When the relationship ends, each party takes whatever property he or she originally brought into the relationship. Only property that the couple acquired together during the relationship must be shared. In some cases, an individual may attempt to claim a share in an ex-partner's property if he or she contributed significantly to its value during the relationship, but proving this can be complicated.

No Automatic Right To Live In The Home

There's yet another significant impact of living and separating in an unmarried state: No automatic right to continue living in the home that the couple shared during the relationship. Whoever legally owns the property is the one with the right to stay. Same for rental properties: the one whose name is on lease is the one who stays.

No Automatic Inheritance

Unlike married couples, cohabiting parties do not automatically inherit the property of a deceased partner who dies intestate. In the absence of a legally valid will specifically mentioning the surviving partner, the law will divide out the property of the departed to his or her next of kin, as prescribed in the law.

Protecting Financial Interests In A Common-Law Relationship

For cohabiting couples, protecting one's financial interests often means making an arrangement different from the current each-to-one's-own model under the law. Prudent common-law couples do so by consulting with a family law lawyer before drafting a cohabitation agreement.

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