Contrary to what many people think, marriage contracts (also known as prenuptial agreements) aren’t actually needed for most engaged couples. Marriage contracts are usually recommended when one or both of the future spouses have a significant amount of property as of the date of marriage that they each wish to protect in the event of divorce. Similarly, a party with significant assets may also want to protect against future spousal support obligations.
The law provides some asset protection even without a marriage contract
In my experience as a Toronto family lawyer, couples who are getting married for the first time may not have a lot of assets to protect and may not want to spend the extra time and money on a marriage contract. Additionally, even without a marriage contract, you will usually get to deduct the value of whatever you bring into the marriage in the event of divorce. If you are anticipating an inheritance, it may also be shielded by operation of law, depending on how the will is drafted. Because the law provides these kinds of protections, you may not need a marriage contract at all. Of course, everyone’s circumstances are different, so you should speak with a Toronto family lawyer before deciding whether or not a marriage contact is necessary in your particular situation.
Marriage contracts can protect the increase in value of any business or asset
If you are interested in protecting the “increase in value” of an asset over the course of your marriage, like the value of a small business you’re starting, a marriage contract can help you shield this increase in value from your spouse. Once again, it is crucial for you to speak with a Toronto family lawyer before deciding whether or not a marriage contact is necessary in your particular case.
Marriage contracts can’t address home possession and child-related issues
Ontario law does not allow you to address custody, access, or child support issues in a marriage contract. Any term in a marriage contract dealing with these issues will not be binding.
In Ontario, terms in a marriage contract dealing with possession of the matrimonial home upon marriage breakdown are also not binding. Marriage contracts can, however, deal with the issue of ownership of the matrimonial home.
The parties must make full financial disclosure
In order for a marriage contract to be fully binding and enforceable, both parties must exchange full financial disclosure. Your lawyer can assist you with this.
Consult a Toronto family lawyer
Before you even raise the idea of a marriage contract with your partner, it is highly advisable to discuss the issue with a family lawyer. You may find that because of your particular circumstances, your lawyer recommends against having a marriage contract. If this turns out to be the case, you won’t need to bring up the issue with your partner at all.