How Do Common Law Relationships Affect Division of Assets

Common law relationships have become more prevalent than ever. These are relationships where a couple has lived together without legally being married. In Ontario, you can be in a common law relationship if you have lived with your partner for at least 3 years with a conjugal relationship similar to that of a married couple. Alternatively, your relationship can be considered common law if you have a long-standing relationship living together with a shared child. When you’re in a common law relationship that is coming to an end, and you’re concerned about the division of assets, contact the family lawyers and civil lawyers in Toronto and Ontario and Karrass Law. Common law division of assets follows different legal requirements than a legal marriage, so if you and your partner are having disputes or disagreements about asset division, contact our team for expert legal advice. 

Common Law Versus Legally Married Division of Assets 

One of the most significant differences between a common law relationship and a marriage in Ontario is how assets are divided upon separation. In a legal marriage, Ontario’s Family Law Act governs the division of property, mandating an equal division of assets acquired during the marriage, including the matrimonial home. However, common law partners do not have the same automatic rights.

Instead, in a common law relationship, property is divided based on ownership rather than equal sharing. This means that if one partner owns a home or vehicle, the other partner does not automatically have a claim to that asset, even if they contributed to the household. This difference in equalization or division of assets in common law relationships can often be a source of tension between partners when separating. If you’re not getting what you’re rightfully entitled to, book a legal consultation with Robert Karrass and the Karrass Law team. As skilled civil litigation lawyers and family lawyers in Toronto and the surrounding areas, Karrass Law can provide you with tailored legal advice and skilled representation to protect your best interests. 

How Common Law Partners Can Divide Assets

Although common-law partners do not have the same legal rights to assets as married couples, there are situations where a partner can make a claim to certain property. For the most effective results, it's best to pursue these financial claims with a trusted and experienced family and civil lawyer. 

Claims to a certain property or assets will typically occur when one partner has contributed financially to it. Some instances include paying a portion of the mortgage, sharing in household expenses, or investing in substantial renovations. In these cases, legal claims based on unjust enrichment or constructive trust may be pursued to recover contributions.

• Unjust enrichment is when one partner has financially benefited at the expense of the other without providing proper compensation. 
• Constructive trust is a legal option that may allow a partner to claim ownership of an asset or a portion of its value, even if their name is not on the title. This remedy is often pursued when one partner has contributed to an asset but does not have formal ownership rights, like with a home or shared vehicle.

Can a Shared Child Complicate Division of Assets

Shared children between a common-law couple, whether they are biological or adopted, can make separation more complicated. A child between a common-law couple does not automatically grant the same division of assets or equalization rights as a legally married couple, but it can certainly result in a more complex division of assets. 

When it comes to separation, children can influence spousal support (or alimony payments) and child support payments. If you and your partner have a child together and are separating, consult with a family lawyer near you for reliable legal advice that seeks the best possible results for you and your child. 

As experienced civil and family lawyers, the Karrass Law team can provide guidance on how to handle the division of assets and custody in common law separations involving children.

Domestic Contracts That Can Affect Separation

If you and your common-law partner have pre-existing domestic contracts, they can play a key role in defining how assets will be divided in a separation. These agreements are legally binding and allow common-law partners to outline their respective rights and obligations concerning asset division and other financial matters.

• Cohabitation Agreements: A cohabitation agreement is a contract that common law partners can enter into while they are living together. This document outlines how assets will be divided if the relationship ends, protecting both parties from potential disputes. 
• Separation Agreements: A separation agreement can be used to formalize how assets, debts, and responsibilities will be divided if the relationship ends. Separation agreements allow both partners to negotiate terms outside of court-setting. Consulting with a mediation lawyer or family lawyer can help ensure that the separation agreement is fair and legally enforceable.

Why Seek Legal Advice and Representation with Karrass Law

Separations are often some of the most challenging times for couples, whether you’re in a marriage or a common-law relationship. It’s important that if you have financial claims or are concerned about the division of assets you get the best representation possible. By seeking legal advice and guidance from the team at Karrass Law, you will get the expertise of lawyers experienced with complex division of assets, family law, civil litigation, mediation, contract law, and more in just one lawyer. Our team will provide you with thoughtful and strategic advice and help to generate the best results possible for your case. To learn more, get legal advice from the Karrass Law team. 

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