Am I in a Common Law Relationship?

In a big expensive city like Toronto, it often makes financial sense to live with your partner to save on rent and share expenses. This article will explore the legal consequences of living with your romantic partner and what you can do to protect yourself.  

When it comes to cohabitation, the length of time matters. As your financial lives intertwine, a state dependency may be created. One partner may be entitled to spousal support if the relationship ends. Where one person controls much of the property or wealth, the other party may obtain a right to a portion of this property over time. This post will explore claims for spousal support and property claims in the context of unmarried partners living together.  

SUPPORT CLAIMS:
FAMILY LAW ACT

In Ontario, Part III of the Family Law Act (FLA) covers spousal support obligations. Unmarried couples will qualify as a "spouse" if they cohabit continuously for a period of 3 years. The 3-year minimum does not apply if the couple had a child together during the period of cohabitation. Here are some of the terms, defined: 

Cohabitation: this refers to a "marriage-like" relationship where two people live together. You may feel that you are simply sharing expenses in an economic arrangement, rather than living in a "marriage-like" relationship. You may also feel, in retrospect, that you were never totally committed to that relationship. However, if you were living under the same roof, sleeping in the same bed, eating meals together, sharing an expectation of fidelity, and participating in social activities together, the argument that you were not cohabiting with that person would likely fail. For a list of factors used to determine when a couple is "cohabiting" see paragraph 16 of the following case: Molodowich v. Penttinen, [1980] OJ No. 1904. 

Continuously: The cohabitation does not need to be uninterrupted to be considered "continuous."  If there is no intention to permanently separate, the cohabitation may continue even where one person leaves for a period of time. This can even occur even when one person lives in another country for a period of time, or one person has maintained a separate residence. A continuous period of cohabitation does not end until one person demonstrates, convincingly, that their mind has been made to end the cohabitation for good. 

If you have child with a person during the period of cohabitation, different rules apply. You will be considered a "spouse" if the relationship is one of "some permanence." No minimum length of cohabitation is necessary. The longer the relationship before cohabitation began the easier it will be to prove the relationship was of "some permanence." 

The law recognizes that individuals assume different roles in a relationship. When the relationship ends, support payments may be necessary to alleviate hardship or compensate the person who sacrificed their career to support the other partner. Even if you fall within the definition of "spouse" under part III of the Family Law Act, you may not be entitled to, or owe, spousal support. Click here for more information about entitlement to spousal support.

Common Law PROPERTY CLAIMS

When it comes to property rights, married and unmarried couples stand on very different legal grounds. Parts I of the Family Law Act (FLA) sets out rules for dividing property after the breakdown of a marriage. Part II sets out special rules regarding the matrimonial home. These sections do not apply to unmarried couples.

Unmarried couples must rely on the "common law" which is a body of judge-made law dating back to England in the middle ages. Compared to married couples under the Family Law Act, the common law provides much less certainty for unmarried couples. Property claims can be made against real estate, investments or other items.  

It is important to understand the "give and take" nature of a relationship to understand when property rights may arise over time. The common law will reward someone for making valuable contributions to other individual's accumulation or maintenance of property if those contributions were not fully compensated.

A common example of this would be the unpaid provision of domestic services, such as home maintenance, cooking, or childcare. If one person is primarily responsible for these duties, they have enriched the other person without being compensated for doing so. 

This kind of imbalance - where one person takes more than they give - is called an "unjust enrichment."  Since cohabitation often provides mutual benefits for each partner, it is often difficult to identify an imbalance and determine what amount should be provided as compensation. For example, the person who provided domestic services may also have received free room and board.

The difficulty in quantifying these contributions has led to a flexible approach taken by the courts. The leading case of Kerr v. Baranow, [2011] 1 S.C.R. 269, from the Supreme Court of Canada provides guidance on this issue, at para. 81:

"...the basis of the unjust enrichment is the retention of an inappropriately disproportionate amount of wealth by one party when the parties have been engaged in a joint family venture and there is a clear link between the claimant's contributions to the joint venture and the accumulation of wealth. ... The monetary award should be assessed by determining the proportionate contribution of the claimant to the accumulation of wealth." [emphasis added]

So what is a "joint family venture" and why is it important? Under the Family Law Act, married couples are presumed to engage in a joint venture involving the pooling of resources and joining of efforts to achieve common goals. This is used to justify the splitting of accumulated gains during the marriage 50/50 after a separation.

Common law couples may be living in much the same manner by pooling their resources and working towards common goals. The law will recognize all contributions made by both partners and decide if one partner is retaining a disproportionate share of the wealth. In essence, the common law may treat unmarried partners the same, or similar to, married couples.

Unlike a married spouse, a common law spouse intending to make a claim against the other individual's property must provide proof of a "joint family venture". Some facts may include:

• Raising children together,
• A clear division of labour with one spouse attending to domestic responsibilities allowing the other to pursue paid labour in the workforce,
• Economic integration through joint bank accounts, sharing of expenses, etc.  

It is also important to look at intentions. If there was little accounting or concern about who paid for household items, bills, and other expenses big or small, the existence of a "joint family venture" can be inferred.

There may also be factors to suggest that the parties intended to keep their economic lives, and property, separated. Getting married is a choice, and staying unwed is also a choice. Where the intentions are clear to keep property rights in tact, the courts will defer to those intentions.  

As indicated earlier, both partners likely received some benefit from the cohabitation. If this is the case, the defendant may seek to have the claim reduced in proportion to the benefits received by the spouse making the claim.  

In addition, the parties may have come to an understanding, perhaps in the form of a cohabitation agreement, that there would be no claims to each other's property after separation.  Evidence of an agreement or a mutual understanding must be produced by the defendant. 

It should be clear by now that common law spouses are in a legal gray area when it comes to property rights. Two people may have very different hopes and expectations in a relationship. The legitimacy of any claim against property relies upon many subjective factors, such as each partner's intentions and expectations. Understanding your rights and obligations is a must to avoid any of the unintended legal consequences of cohabitation.