Cohabitation Agreements for Older Adults in Ontario
Learn about how a cohabitation agreement can protect your assets and reduce conflict . . .
For older adults, moving in with a partner involves more than just sharing a home—it often means blending finances, assets, and existing long-term plans. Unlike younger couples, older adults are more likely to have accumulated significant assets over their lifetime such as a home, secondary properties like cottages or rental units, savings, pensions, and investments. Many enter this stage after a long marriage, whether through divorce or widowhood, and may have specific goals for preserving their financial security and existing estate plans. However, when they enter a new cohabiting relationship, if a clear legal agreement is not in place, these arrangements can become disrupted—especially in cases of separation or incapacity.
What Is a Cohabitation Agreement?
A cohabitation agreement is a legal contract between two unmarried partners who live together. It sets out property rights, financial responsibilities, and other key arrangements. In Ontario, these agreements help prevent legal uncertainty by addressing issues that would otherwise be determined by provincial laws.
How a Cohabitation Agreement Provides Peace of Mind
A cohabitation agreement can ensure that existing wealth, retirement plans, and estate plans remain in place. Without a clear cohabitation agreement, you may face the following challenges in the event of separation, incapacity, or death:
Disputes Over Property Ownership: In Ontario, unmarried partners do not have automatic rights to property division under the Family Law Act. However, questions can still arise about whether certain assets are held jointly. Without a clear legal agreement, property may be treated as shared—even if one partner assumed otherwise. This uncertainty can lead to disputes over homes, cottages, bank accounts, and investments.
Support Payments: In Ontario, unmarried partners are not automatically entitled to spousal support. Nonetheless, unmarried partners may still be able to seek spousal support if they were financially dependent upon the other partner during the relationship. Without an agreement that addresses spousal support obligations, unmarried partners may be required to negotiate these terms in a separation agreement or seek a court order to resolve the matter.
Confusion and Disputes about the Estate: Although an unmarried partner does not automatically have a right to inherit under Ontario’s Succession Law Reform Act, the situation can still lead to significant uncertainty. If the deceased intended for their unmarried partner to inherit, but did not update their will, the surviving partner may be left with nothing. Conversely, if the unmarried partner was intentionally left out of the will, they may feel their exclusion was unfair and pursue a Dependant’s Relief claim or assert a claim of Constructive Trust against estate property that they contributed to financially or otherwise. Either scenario can lead to family disputes, legal costs, and delays in estate administration.
Confusion Over Shared Expenses and Debts: Without clear terms, at the end of the relationship, there may be disputes regarding who is responsible for debts, mortgage payments, or other financial obligations, leaving both unmarried partners vulnerable to unexpected liabilities. Resolving these issues can be time-consuming and complex without proper documentation.
Loss of Housing Security: If the family home is owned by one partner, the other may have no legal right to stay after a breakup or death, even if they contributed financially to the home. In this situation, the owner—or their estate—may face unexpected claims for occupancy or compensation, complicating their ability to sell the property or pass it on to their heirs.
Pension and Benefit Uncertainty: Unmarried partners may or may not qualify for pensions, insurance payouts, or survivor benefits, depending on how institutions define their relationship. This may leave a surviving partner financially vulnerable. Similarly, without a clear plan in place following the end of a relationship, a former partner may still attempt to claim benefits that were never intended to be shared.
Signing a Cohabitation Agreement?
At Gillespie Legal, we not only assist with drafting cohabitation agreements, but we also offer Independent Legal Advice (ILA) for individuals whose partner may ask them to enter into a cohabitation agreement. We understand that these agreements can be daunting, and it’s important to ensure that individuals fully understand their rights and the legal implications of these agreements before signing anything.
Contact Us to Learn More
Ultimately, a cohabitation agreement can offer peace of mind and protect your assets. Whether you're looking to create a cohabitation agreement or need advice on a proposed one, contact Gillespie Legal today to learn more about how we can help secure your future!