I’m in love and we’re moving in together! No problems….right….?

This is an exciting time for couples, but a little information can make things go a lot smoother as things move forward. Call me a ‘pragmatist’, but this maneuver has cost many a well meaning love bird not only heartache, but a lot of money (and a really big fight)!

What could possibly go wrong in this situation?

When you decide to live together  you are choosing to live common law. That means the legislation that  applies to you is the  Adult Interdependent Relationships Act of Alberta  . If you are very young and own very little, this is far less of an issue because everything will probably up as joint property anyway. When you are older and on your second (or third) go-round, you may have more substantial assets coming into the relationship, and its probably wise to understand how your actions will affect you and your other family members. If you think about it rationally, it may a good a exercise for a couple to sit down and have a mature discussion on these issues, it may actually help you come together!

As a Realtor who has dealt with this situation countless times and have lived the experience personally, I would like to lay out a few important facts when it comes to property rights in this situation.

In the province of Alberta, if you move in with another individual and do not get married , you are living Common law . To be considered common law you must;

1. cohabit for three years;
2. cohabit and have a child together; or
3. enter into an adult interdependent relationship (which involves a written contract).

To nullify this arrangement, you must be separated for at least one year, or enter into another inter-dependant relationship.  

The Interdependent Act and Matrimonial property act differ in one key way;

Property Rights
When a marriage ends, property division in Alberta is governed by the matrimonial property act. This act only applies to married couples, not common law couples. So, there is no automatic right to property division when a common law relationship ends. Each party keeps what they own, and joint property is shared equally. If one partner is not satisfied with that result, they can apply to the court on the grounds of unjust enrichment, which is a lengthy and complex legal process (that can end up with a lot of very expensive hurt feelings).

The only way to change that is to have a co-habitation agreement in place before you move in together. That is an agreement between yourselves as a couple that spells out exactly what will happen in the event your endless love actually comes to an end. Essentially you are writing a divorce before you move in together…. doesn’t sound very romantic does it? Perhaps not, but it sure makes things go a lot smoother in the event the sh*t hits the fan. You have ground rules to resolve your property issues without a fight. We have a saying in the Real Estate business: “Good paper makes for good relationships”.

A couple of key things to look at in your agreement is how you own the property; joint tenancy(like married people) or tenancy in common(like a business arrangement), what happens if you make (or loose) money while you are together and what happens when one of you has more money into the property than the other or made more payments during the relationship. These are the flashpoint issues that are the basis of most fights.

This can go very well and has worked out fine for many people, however, I recommend that anyone moving in to a newly purchased home, or one that is already owned by one party, get advice from a lawyer who practices family law. It can help separate fact from urban myth when you are making potentially life-altering decisions.

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