These days it seems that more often couples are deciding to live together without being in a traditional marriage. Some use this as a step towards marriage, an opportunity to test the waters. Others feel that this arrangement is the most beneficial to them. Sometimes cohabiting with someone makes more sense economically. Couples should be mindful that there are some rights and benefits that a common law spouse has that are similar to a married spouse.
If a couple wishes to enter into a common law relationship they should understand what that entails. Having a common law spouse has many implications including tax implications during the relationship, and support implications if the relationship doesn’t work out.
Living together does not automatically make a couple common law spouses, there are other considerations. In Ontario, the Family Law Act defines a spouse as “two persons who are not married to each other and have cohabited either continuously for a period of not less than three years, or in a relationship of some permanence, if they are the natural or adoptive parents of a child.”
For tax purposes the definition changes. The Federal Income Tax Act defines a common law partner as a person who cohabits at that time in a conjugal relationship and; has cohabited for the previous year, or has a child with that partner. The provincial Income Tax Act uses the same definition.
The tax statute allows the couple to claim the status a great deal sooner. The time requirement also changes from province to province. It is important to note though, that in both statutes the minimum time is affected if the couple has a child together.
The essential element of each of these statutes is cohabitation. Defining what constitutes cohabitation is largely dealt with in the courts. The decision of Molodowich v. Pettinen set out what factors to look at when determining if a couple was cohabiting. These categories include shelter, sexual and personal behaviour, services, social, support, and children. Looking at these issues helps the courts determine if the couple is in a spouse like relationship. No factor in this analysis is determinative of whether the couple was cohabiting. Each will be more or less relevant depending on the relationship.
Couples thinking about cohabitation should discuss what they each want from that relationship. It may even be worthwhile to write a cohabitation agreement to avoid conflicts down the road. These contracts, like prenuptial agreements, help establish what will happen if the couple wishes to discontinue the relationship. Before entering into one of these agreements couples should exchange financial information and each have the agreement reviewed by a lawyer.
Scott Buchanan is an articling student at the law firm of Cobb & Jones LLP. For more articles, visit the Library Page at www.cobbjones.ca.