What to consider before getting married
A prenuptial agreement is for couples who intend to marry and want to clarify in advance their arrangements for spousal support and how they will deal with the division of matrimonial property if they separate or divorce.
Notably, Canada does not have federal legislation dealing with marriage agreements or domestic contracts. Provinces and territories have enacted provincial laws to deal with these.
Here’s one couple’s story*: Clarissa and Stephan, both in their mid-30s, are set to marry shortly. The Vancouver-based couple met six years ago at a dinner party arranged by a mutual friend but have always retained their separate residences. The topic of a prenuptial agreement – also known as a pre-marriage agreement or domestic contract – came up several years into their relationship following the example of friends in a common-law partnership who opted for a cohabitation agreement. Both ambitious and hard-working professionals, Clarissa and Stephan had agreed at that time to seriously consider a prenup later down the line.
In contrast, Clarissa’s brother’s experience highlights what can happen in the absence of any domestic agreement and a large imbalance of wealth.
Couples should discuss a prenuptial agreement long before a wedding or co-habitation plan. This ensures both parties are prepared, with neither caught off-guard by the arrangement.
What a prenuptial/marriage agreement should contain to be valid:
- Full financial disclosure
- Independent legal representation for each party
- Absence of duress
- Proper time to negotiate
- Compliance with the family law act and divorce act of the relevant province in which the couple resides
While some provinces, such as Ontario, Nova Scotia, New Brunswick and Saskatchewan require high standards for intervention, such as fraud, undue influence or unconscionability, British Columbia uses a standard of fairness, which is a lower threshold for judicial intervention than the other provinces.
Talk with a Richardson Wealth Investment Advisor to discuss a plan.