Monday, July 18, 2022
Longtime Ontario family lawyer Russell Alexander says a recent rise in common law partnerships poses some legal risks as couples sort out their finances in a much less well-defined area of law.
While there are clearly established guidelines for when married couples’ homes and finances should be treated as joint assets, those rules are a lot looser for couples living in a common law relationship, said Alexander.
“Couples that decide to pursue a common-law relationship typically choose to keep their finances separate, but there are times when that is no longer feasible,” said Alexander, who is founder of Russell Alexander Collaborative Family Lawyers. “What happens when they get older and one has retirement savings and the other doesn't? And what if they divorce at that point? There are a lot of unsettled questions.”
Recent data released by Statistics Canada from the 2021 national census showed that 23 percent of couples who live together are unmarried, the highest percent of any G7 nation. That number has also grown at a much higher rate than marriages over the last 40 years.
Some of those couples are older and have already been married. Others intended to get married but put off the decision due to backlogs during the coronavirus pandemic. And others have more philosophical objections to traditional marriage.
“There’s nothing inherently wrong about deciding to go the common-law route rather than get married, but couples should be aware of some of the pitfalls,” added Alexander. “Many problems can be avoided by talking with a lawyer or a financial planner about how they want to respond to possible future situations.”
