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If you have decided to live with another person in a ‘defacto’ relationship (not married), then you should give consideration to the legal issues that this gives rise to. People intending to live together (whether married or not) are choosing to regulate their affairs by their own written agreement which will either partially or completing specify their legal rights should a disagreement arise or their relationship come to an end for any
reason.
We recommend that you have an agreement in place between yourself and your partner that deals with issues such as:
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The assets that each of you had before entering the relationship
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The assets that you want to retain as your own
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The assets that you have ‘pooled’ in common together
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Your understanding together on sharing of
expenses
By sitting down with your partner and talking through these issues in a non threatening manner, you are not only putting your legal affairs in order, you are also taking the time to sort out these issues together (which can avoid misunderstandings later on).
What happens when couples don’t agree on these issues, and put them in writing, is that later on disagreements arise (such as when an asset is sold, or if the relationship breaks up). We have seen some intense disputes about who brought what into the relationship, and who contributed to what. Without good documentation it can be hard to prove what you had separately and what is now joint
assets.
To protect your and your partners assets, as well as to put together a plan for building joint assets, one of the following agreements is recommended:
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The Living Together Agreement (also known as a Co-Habitation Agreement) - is a contract between two people who wish to live together but do not wish to be married to each other at this time.
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A Pre-marriage Contract - very similar to the Living Together Agreement (above), but geared towards parties who are seriously contemplating marriage in the not too distant
future.
What happens if I don’t do
anything?
Legal service is like an insurance policy – hopefully things will go smoothly, but if they don’t, having your affairs in order can make the world of difference – both in peaceful resolution of things, and in savings on costly legal battles. Legal matters can get particularly nasty and expensive in personal relationships that go
wrong.
For defacto relationships, in most Australian jurisdictions if you do not have a written agreement about your affairs, then it will be up to the Court to decide who owns what, and in what proportions. Without receipts and proper documentation, this can often be decided on one person’s word against the other (that is, who is more believable on the day).
Essentially the rule is what financial contribution did each party make to the assets in question. Non financial contributions are not taken into account in most jurisdictions, so if you stay home and look after the domestic scene, you may be short changed unless you have an agreement in place with your partner that compensates you for your non monetary but nevertheless valuable
contribution.
If you are married, your agreement takes second place to the provisions of the Family Law Act, which can apportion your assets as it believes is
fair, given the contributions of both parties (monetary and non monetary) as well as whether there are children to the marriage. New legislation has been introduced very recently that gives these agreements more weight, so they are still an important
exercise.
When can I make one of these agreements?
The Living Together Agreement can be entered into before or during
the relationship and are basically intended to record the property and income being contributed by each party at the commencement of the relationship as well as the rights and entitlements consequent upon break up of the relationship or the death of one party.
If you are already married, and wish to enter into an agreement with your spouse, then we recommend that you talk to a Lawyer first,
through Legalmart Consult. For a small fixed fee, you can get legal advice from a Lawyer on the best way to do this.
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