you need to know about a
Prenuptial Agreement in Canada.
A Prenuptial Agreement in Canada is a legally binding contract entered before marriage. In some provinces and territories, the term Prenuptial Agreement is commonly referred to as a domestic Contract or a Marriage Contract.
A Prenuptial Agreement in Canada is also referred to as antenuptial agreement or premarital agreement and is abbreviated as “prenup”.
If Couples sign a written contract before they get married then it is a prenuptial agreement and if they sign the written contract after they are married then it is a marriage contract.
Whereas, if a common-law couple enters into an agreement of similar nature it is referred to as a Cohabitation Agreement in Canada.
Therefore the difference between a Prenuptial Agreement and a Marriage Contract is the date when the agreement is being executed between spouses whereas a Prenuptial Agreement and a Cohabitation Agreement in Canada is differentiated by Type of Relationship.
In Canada, we do not have federal legislation dealing with marriage agreements or domestic contracts. Provinces and territories have enacted provincial laws to deal with the issue of marriage agreements and domestic contracts.
In this Article, we will specifically refer to a Prenuptial Agreement but the Legal Nature and effects of all domestic agreement and Marriage Contracts are similar, such as they seek to protect parties Assets, debts overflow, support, and children.
Prenuptial Agreement is Prepared to Protect Both Parties.
Tip 1. Talk about Finances.
It is important to talk about your finances prior to entering into a relationship as a married couple or as a common-law partner.
Although it could become extremely difficult to bring this topic it must be addressed. Couples moving in together or getting married could have serious financial implication at the time of Divorce or Separation. The purpose of a Prenuptial Agreement in Canada is to make sure both spouses are treated fairly.
Do remember that a Judge will take into consideration a Prenuptial Agreement at the time of making a decision on division of property and support.
Tip 2. What does a Prenuptial Agreement Contain or Cover or What is the purpose of a Prenuptial Agreement?
A Prenuptial Agreement in Canada will set what property or asset, debt each person is bringing into the marriage and shall specify the terms and conditions of the division of ownership of property, assets, debts as well as spousal support at the time of separation or divorce.
Some Prenuptial Agreement may deal with the issues relating to the children brought into the marriage.
The structure of Division of Property can be incorporated in the Divorce Order if it is stated in the Prenuptial Agreement.
The standard theme of the document is that the property and debt brought into the marriage by individuals remain their property or debt and any property, asset or debt acquired in individual names shall remain their own. However, one must speak to a Lawyer before signing a Prenuptial Agreement in Canada
Tip 3. Why do you wear a Seatbelts? It will protect you in an accident?
When you are on the road as driver or passenger you hope that your journey would be without any accidents but you still take precautions to protect yourself by fasting your seatbelt. Similarly, a Prenuptial agreement is an insurance for your marriage or common-law relationship.
In the unlikely event of a Divorce or a Separation, both parties can save hundreds of thousands of dollars in Legal Costs, emotional trauma and unfair treatment. The key purpose of a Prenuptial Agreement is set terms on how to split your assets, liabilities, and support in the event of separation or divorce.
Common Question we get is WHY DO I NEED A PRENUPTIAL AGREEMENT IN CANADA? One must consider if he/she is living as a Common-law Couple or planning to Get Married this could have serious legal implication affecting your finances.
Parties may want to make sure that they protect the property they own prior to marriage and after marriage.
WHAT IF YOU DO NOT HAVE ANY ASSETS OR LIABILITIES PRIOR TO MARRIAGE? DO YOU STILL NEED A PRENUPTIAL AGREEMENT IN CANADA? Let us presume that both of you as a couple do not have any assets or liabilities at the time of getting married or at the time of moving in together.
A thought may cross your mind that in such a situation it would not be worth spending hundreds of dollars in Lawyer’s Fees. Cost of a Prenuptial Agreement, range from $499 to $2,000 +HST, whereas the cost of litigation would range between $10,000.00 to $90,000.00 + HST.
On the other hand, you may not have any debts prior to marriage but during the course of a marriage, you could acquire debt resulting in serious legal and financial consequences if you separated or divorce.
then it would be wise to enter into a marriage contract to ensure that in the unlikely event of break up of marriage you are protected and your assets are protected.
Therefore it is always important to have a Prenuptial Agreement. A good prenuptial agreement Lawyer will always advise couples to have a Prenuptial Agreement in Canada. Also, read Tip 8.