Cohabitating couples in Alberta may see some changes

Couples living in a common-law relationship in Alberta may soon be affected by proposed changes to family-law legislation. Current legislation in Alberta does not provide property rights to common-law spouses. Instead, to access property if the common-law relationship ends, a common-law spouse must make arguments based on fairness or equity that usually involve unjust enrichment, or resulting or implied trusts.

The Alberta Law Reform Commission has released a report, “Property Division for Cohabitants”, that reviews property rights for cohabitating couples. The report has gone to the Alberta legislature for review and consideration.

The report is a collation of information gathered through consultations with individuals in cohabitation arrangements and family-law lawyers. One interesting insight from the report is that most people who are cohabitating believe they already have property rights. This point is probably also true in the other common-law provinces that have similar legislation.

Based on the information gathered by the Commission, there appears to be support to change Alberta’s property rights for people in common-law relationships.

Support rights already exist under the legislation. The proposed legislation would address the obligations and responsibilities relating to property for cohabitating individuals. Couples would also have the option to enter into a cohabitation agreement that would address their property issues the same way married couples address property issues in a pre-nuptial agreement or marriage contract.

While it’s always advisable for couples to enter into a cohabitation agreement so that they fully understand their rights and obligations, doing so now may be more pressing with this potential legislative change looming on the horizon. People who own property and are already in a common-law relationship may want to preserve their property rights before any new legislation affects those rights. On the other hand, people who do not own property but live with a spouse who may not be so eager to have a cohabitation agreement in place.

Couples should always have proper plans in place for what happens when a relationship ends regardless of existing legislation. Life insurance is often used to fund a support obligation and it may have a role to play, if the new legislation addresses property claims made by the surviving common-law spouse when their partner dies.

We’ll keep you posted on what happens with the proposed legislative change.