Unmarried couples in Ontario who live together, or plan to, can protect their rights and clarify their financial expectations by entering into a cohabitation agreement. These agreements are recognized under Ontario law and can cover property, spousal support, debts, and more. Unlike married spouses, common-law partners in Ontario do not have automatic rights to property division upon separation, making these agreements especially important.

This article explains how cohabitation agreements work in Ontario, what makes them enforceable, and the key legal framework that governs them.

Are Cohabitation Agreements Permitted in Ontario?

Yes. Cohabitation agreements are expressly permitted under Ontario law. Section 53(1) of the Family Law Act, RSO 1990, c F.3, provides the statutory foundation:

“Two persons who are cohabiting or intend to cohabit and who are not married to each other may enter into an agreement in which they agree on their respective rights and obligations during cohabitation, or on ceasing to cohabit or on death, including,

(a) ownership in or division of property;

(b) support obligations;

(c) the right to direct the education and moral training of their children, but not the right to decision-making responsibility or parenting time with respect to their children; and

(d) any other matter in the settlement of their affairs.”

This provision enables both current and future common-law partners to enter into legally binding agreements that structure their relationship.

What Can a Cohabitation Agreement Cover in Ontario?

A cohabitation agreement in Ontario can address:

• Ownership and division of property (present or future)
• Spousal support obligations
• Responsibility for debts and expenses
• Rights upon separation or death
• Other personal and financial arrangements agreed upon by the parties

However, there is one important exception: parenting time and decision-making responsibility for children cannot be determined in a cohabitation agreement. These matters are governed by the Children’s Law Reform Act and must be determined in accordance with the child’s best interests at the time of dispute.

What Makes a Cohabitation Agreement Enforceable in Ontario?

To be enforceable under Ontario law, a cohabitation agreement must meet the following legal requirements:

1. Compliance with Section 55 of the Family Law Act

Section 55(1) of the Family Law Act sets out the formal requirements:

“A domestic contract and an agreement to amend or rescind a domestic contract are unenforceable unless made in writing, signed by the parties and witnessed.”

Verbal or informal agreements are not enforceable. The agreement must be:

• In writing
• Signed by both parties
• Signed in the presence of a witness, who also signs

Failure to comply with these formalities may render the agreement invalid.

2. No Duress or Undue Influence

The agreement must be entered into voluntarily. If one party was pressured or coerced into signing, the agreement can be challenged in court and possibly set aside.

3. Full and Frank Financial Disclosure

Although not a strict legal requirement under the statute, courts in Ontario have held that failure to provide full financial disclosure may be grounds to invalidate an agreement. Section 56(4)(a) of the Family Law Act provides that:

“A court may, on application, set aside a domestic contract or a provision in it,

(a) if a party failed to disclose to the other significant assets, or significant debts or other liabilities, existing when the domestic contract was made.”

In short, both parties are required to understand the other’s financial situation.

4. Independent Legal Advice (ILA)

Independent legal advice is not mandatory, but strongly recommended. A party who signs a cohabitation agreement without legal advice may still be bound by it. However, the absence of ILA increases the risk that a court may later set the agreement aside for unfairness or lack of informed consent. Judges scrutinize whether both parties understood the consequences of the agreement.

5. Substantive Fairness

Courts in Ontario generally respect parties’ freedom to contract, even if the terms are harsh. However, a court may intervene if the agreement is unconscionable at the time of enforcement. That is, if the result is shockingly unfair in light of the parties’ current circumstances, it may be set aside.

Can a Cohabitation Agreement Be Set Aside?

Yes, but the bar is high. Under section 56(4) of the Family Law Act, a court may set aside a cohabitation agreement (or any domestic contract) where:

• A party failed to disclose significant assets, debts, or other liabilities;
• A party did not understand the nature or consequences of the agreement; or
• The agreement is otherwise unconscionable.

Does a Cohabitation Agreement Still Apply If the Couple Marries?

Yes, unless the agreement says otherwise. Section 53(2) of the Family Law Act provides that:

“If the parties to a cohabitation agreement marry each other, the agreement shall be deemed to be a marriage contract.”

This means the terms continue to apply after marriage, and the agreement is treated as a marriage contract under Ontario law. However, this presumption can be expressly overridden if the parties include a clause stating the agreement terminates upon marriage.

Unique Considerations for Ontario

Here are some Ontario-specific factors to keep in mind:

• No automatic property rights for common-law couples: Unlike married spouses, common-law partners in Ontario do not have statutory property division rights under Part I of the Family Law Act. Without an agreement, each party generally keeps what they own, unless a trust claim is made.
• Spousal support rights may still apply: While property rights are limited, common-law partners may still be entitled to spousal support under Part III of the Family Law Act, provided they meet the definition of “spouse” (i.e., cohabiting for at least three years, or having a child together in a relationship of some permanence).
• Estate rights: Common-law partners do not automatically inherit under Ontario’s Succession Law Reform Act. A cohabitation agreement can include terms for inheritance, but it should be accompanied by a properly drafted will.

Practical Tips When Drafting a Cohabitation Agreement in Ontario

• Exchange detailed financial disclosure statements up front
• Include a certificate of independent legal advice for each party
• Specify whether the agreement survives marriage or terminates upon it
• Be cautious of overly one-sided or ambiguous terms

Conclusion

A cohabitation agreement in Ontario is a legally recognized and enforceable way for unmarried couples to define their rights and protect themselves in the event of separation or death. While not required by law, such agreements can reduce future conflict and ensure that both partners enter the relationship with clarity and mutual understanding. To ensure enforceability, the agreement should be properly drafted, signed with a witness, and ideally reviewed by separate lawyers for each party.

You’re Invited to Call or E-Mail!

If you’re considering a cohabitation agreement — or have already made your decision — you’re invited to call or email us. We’ll explain for free how you can protect your assets and plan your estate. You can call us toll-free at (800) 407-2570 or email us using our contact form here. We can help you anywhere in Ontario, including Ottawa, Toronto, Mississauga, Brampton, and Hamilton.