As you scan every word of this web page, you will start to understand exactly what it means to live in a common law relationship and what your common law rights are when your relationship with your spouse ends.
When you are not legally married to your spouse, you are living together in what is usually called a common law relationship.
The Ontario Family Law Act defines a common law relationship in the following manner:
A common law spouse means a spouse is one of two persons “who are not married to each other and have cohabited, (a) continuously for a period of not less than three years, or (b) in a relationship of some permanence, if they are the parents of a child.
In other words, you are deemed to be living a common law relationship when you have living with another person in a romantic relationship on a regular basis for three years or more or you have been living with a person in a romantic relationship on a regular basis for less than three years and you are the parents of a child.
How Does A Common Law Relationship Affect Child Custody,
Access and Child Support?
When you are living in a common law relationship in Ontario, the same family law principles apply to you for child custody and access. It does not matter whether you are married or live in a common law relationship when it comes to this important part of your life.
The family court always decides on child custody and access based on what is in the best interests of your children.
You have to pay child support for your child regardless whether you were married to the other parent or even lived with the other parent. The Child Support Guidelines apply to each parent of a child when the parents are separated or never even lived in a relationship of any type.
Spousal Support When Your Common Law Relationship Ends
If you have lived with another person for three or more years on a regular basis or have lived with another person for a shorter period of time and you are the parents of a child, you could be entitled to receive spousal support.
You are entitled to spousal support when your spouse’s income is much higher than your income and your spouse has the ability to pay.
How to Protect Your Common Law Rights
When You Are Thinking About Living With Another Person
You can use a cohabitation agreement to protect your legal rights when you are giving some thought to living with another person.
A cohabitation agreement is a legally-binding written contract that deals with the consequences of an end of your common law relationship.
A cohabitation agreement can specifically deal with who owns what property and the fact that the other spouse is not permitted to make any claim against specific property. In other words, you can state in the agreement that a spouse cannot make any constructive trust claims against your property.
You can also set out in the agreement that a spouse waives any claim for spousal support against the other common law spouse.
You cannot, however, set out child custody and access terms in the agreement before the relationship has actually ended.
You should certainly contact an experienced family law lawyer to prepare and draft a cohabitation agreement for you.
Common Law Property Rights in Ontario
If you live in a common law relationship with your spouse, that is, you are not married to your spouse, you cannot make a property claim under the Ontario Family Law Act. You have to be married to make an equalization claim under the Ontario Family Law Act.
However, you can make a claim against your common law spouse’s property for contributions you have made to improve or maintain this property. The basis for your claim is that your common law spouse cannot be unjustly enriched by your financial and non-financial contributions.
Specifically, the Supreme Court of Canada has established a three-part test to determine whether a common law spouse has unjustly enriched the other spouse: (1) an enrichment enjoyed by the spouse, (2) a corresponding deprivation suffered by the other spouse, and (3) the absence of a juristic reason for the enrichment.
Ontario family law has clearly recognized that a common law spouse providing domestic services, including housework, can provide an enrichment to the other spouse.
Your Contributions To Your Spouse’s Property
The courts have developed an approach to permit a common law spouse to make a claim against property when the common-law spouse has made contributions in the relationship.
For example, suppose a couple start living together in a common law relationship. The spouses save for a down payment to buy a house. The wife makes a contribution of $5,000 to the down payment of the house. The husband owns the home in his name only. The wife stays home to raise the children. She does the housework and raises the children. The relationship ends after 15 years.
Can the common law wife make a property claim for the house? The answer is yes. The courts have concluded that a spouse can make what is called a “constructive trust” claim against property. Constructive trust means that a spouse who owns property actually holds part or all of the property “in trust” or in care of the other spouse.
The court will look at several factors to decide whether a common law spouse has a constructive trust on property. First, the common law spouse has to give or confer a benefit, advantage, or enrichment on the other spouse. The common law spouse must suffer a disadvantage or deprivation as a result of the contribution that the common law spouse has made. Finally, there must be no legal reason for giving a benefit or advantage to the other spouse.
The courts have found that the performance of household duties and tasks and child care duties can meet this legal test. In the example described above, the court would find that the common law wife has a constructive trust on the home. The court might award 50% interest in the home to the common law wife.
You must have a connection or link between the contribution made and the property on which the constructive claim is made. The contribution must be sufficiently substantial and direct to entitle you to have a constructive trust interest in the property. When you have performed household duties and tasks and child care services in a particular house, there is an obvious connection between the household duties and child care services and the property in question.
You should talk to a lawyer to see if you have a constructive trust claim if you were in a common law relationship.
Some Actual Examples of Common Law Rights
and Constructive Trusts
Real life examples help you get a better understanding of the complicated legal topic of common law property rights and constructive trusts.
In one case, the two spouses lived together in a common law relationship for 13 years. The common law husband made a claim for a constructive trust based on unjust enrichment respecting his common law wife’s home, RRSP and pension.
The husband made a number of payments to pay down the mortgage for the home in which the spouses lived. He paid $28,500 towards the home mortgage. However, only the wife was on title to the home.
The court found that the husband was entitled at least to the payment of the amount he contributed to the home mortgage, that is, $28,500. However, the home increased in value over the length of the parties’ common law relationship. The court explained that it would be unfair to the common law husband to permit the wife to keep the total amount of the increase in the value of the home.
The court awarded $45,000 to the common law husband for his contribution to the home as well as a portion of the increase in the value of the home.
The court did not permit the husband’s claim for any constructive interest in the wife’s RRSP or pension since he did not make any contributions, directly or indirectly, to these assets.
In another case, the common law spouses lived together for 8 years.
During the first half of their relationship, the husband took out a $40,000 mortgage on his home to pay a $40,000 lump sum spousal support obligation to his former wife. The husband used most of his take-home pay from his to pay off this $40,000 mortgage. During this period, the wife looked after the day-to-day household expenses, such as groceries, common utilities, and other expenses that the husband could not pay for, having regard to his other financial commitments. The husband was able to pay off his $40,000 mortgage in only three years.
After he paid off the mortgage, the husband bought a new truck. He repaid the loan on the truck within 30 months. Then he purchased a new boat and motor.
The court held that the common law wife was entitled to $15,000 for helping the husband have the ability to quickly pay off his $40,000 mortgage and his purchase of a truck, boat and motor.
Common Law Rights Claims Against Bank Accounts,
Investments and RRSPs
If a person starts living in a common law relationship with her spouse, both spouses will generally accumulate assets and property during the relationship.
However, a constructive trust will normally only be found when a common law spouse makes a contribution to a specific property. Specific property usually refers to a residential home or property.
The general rule for common law property division is that each spouse is generally permitted to leave the relationship with the property and assets that he or she owns in his or her name alone. For example, if one spouse has stocks and RRSPs worth $50,000, the other spouse has no property claim or legal right to these stocks and RRSPs.
In a recent case, the common law wife and husband lived together for 23 months before the common law husband passed away. The husband promised to transfer his RRSPs to the wife in his will if they were still living together at the time of his death. The wife claimed a constructive trust in the husband’s RRSPs.
The Ontario Court of Appeal explained that there had to be a link between the wife’s contributions to the common law relationship and the asset in which she is seeking a finding of a constructive trust. However, the wife did not contribute, directly or indirectly, to the husband’s RRSPs. Therefore, she had no constructive trust claim in her common law husband’s RRSPs.
How To Protect Your Common Law Rights in Ontario
When you live in a common law relationship, you can separate from your spouse at any time. You do not need to get a divorce since you are not married to your spouse in a common law relationship.
However, you should get a written agreement to solve your family law issues when you and your spouse do separate.This written agreement is called a separation agreement. A separation agreement for common law spouses is very similar to a separation agreement for spouses who are married.
Your separation agreement should deal with the important issues in your separation: child custody, access to your children, child support, spousal support, and the common law property rights issues.
Key Advice on Protecting Your Common Law Property Rights
Clearly you can see the overwhelming complexity of dealing with making a common law property rights claim.
You obviously need the help of a very experienced family law and divorce lawyer to help you in this difficult area of law.
When you come to your first meeting with Thomas O’Malley, a skilled and helpful family lawyer, he will give you solid advice on the strength of your claim and what you can do to get fair compensation for your contributions to your common law relationship.
Contact his office now at (905) 434-8837 to protect your common law property rights.