A couple may enter into a marriage agreement with the intention of addressing things that might happen during the course of their marriage, but more typically, they are intended to address the issues that will arise when the marriage breaks down. While marriage agreements are often executed and will be recognized by the courts as binding contracts, marriage agreements are the exception rather than the rule. There is no legal requirement that you must enter into such an agreement if you're getting married.

When a Marriage Agreement is a Good Idea

Marriage agreements are usually appropriate when:

1. one or both of the parties have a substantial amount of property or assets going into the marriage;
2. one of the parties expect to acquire substantial assets during the marriage through, for example, an inheritance, a settlement or court award, or a gift;
3. the parties want to avoid the stress, grief and anger that can come after a relationship breaks down by deciding in advance how certain difficult issues, like the division of family assets, will be dealt with;
4. one or both of the parties has been married before and experienced an ugly court battle;
5. one or both of the parties will be bringing children from a previous relationship into the marriage; or,
6. one of the parties is entering the marriage with substantial debt.

In most cases, people generally want to protect the property that they're bringing into the marriage and avoid the Family Relations Act's presumption that all assets ought to be split equally between spouses when their marriage comes to an end; many people are looking for an "I'll keep what's mine, you'll keep what's yours" sort of deal.

The odd thing about this is that the court may make an order dividing assets that's different than what a marriage agreement calls for if the marriage agreement is found to be unfair, under s. 65 of the Family Relations Act. As a result, a good marriage agreement will allow a spouse to "earn" an increasing share of the other spouse's property the longer the marriage lasts. In many agreements, a spouse will earn an equal or near-equal share of the assets by the 10 year mark. You don't wind up with an "I'll keep what's mine, you'll keep what's yours" deal after all.

When a Marriage Agreement is a Bad Idea

A marriage agreement may not be appropriate when:

1. neither party has any significant assets;
2. both parties are young and intend to have a traditional marriage; and,
3. neither party is bringing a child into the marriage from another relationship.

In circumstances like that, there really isn't much of a point to executing a marriage agreement. There aren't any kids to worry about and neither party has any assets to protect going into the marriage. Marriage agreements are odd things anyway as they tend to lend a somewhat unpleasant and sometimes petty financial dimension to what ought to be a joyous event. If there's no reason to have one, don't.

Negotiating Marriage Agreements

If a marriage agreement is appropriate and desired, the parties will negotiate the terms of the agreement, and one or both of the parties will prepare a written agreement for each to sign. As with all family agreements, it is important that both parties get independent legal advice about what exactly the agreement means, how it affects their present rights and responsibilities towards one another, and how it will affect those rights and responsibilities if the marriage comes to an end. Getting independent legal advice "strengthens" the agreement by preventing one spouse from saying "I didn't know what it meant" and challenging the agreement.

Marriage agreements should be entered into well in advance of the marriage day. If an agreement is entered into while wedding plans are being worked out and negotiated, the court may be concerned about the circumstances in which the agreement was executed. The emotional stress involved in arranging the wedding may be found to mean, for example, that one of the parties was effectively coerced into signing the agreement. Are you going to tell everyone to go home because your spouse is insisting that you sign a contract or the wedding is off?

On the other hand, there's nothing wrong with executing a marriage agreement after the ceremony, except that the agreement may not qualify as a "marriage agreement" under the Family Relations Act if the agreement is to be used to file a notice against the title of real property pursuant to s. 63 or used as a defence to a claim for the division of family assets under s. 65 of the act. More information about the effect of marriage agreements is contained in the following segment.

Do-It-Yourself Marriage Agreement Kits

Staples, Chapters, London Drugs and other stores generally carry a wide range of DIY legal products, from doing your own Will to getting your own divorce.

In the author's view most of these DIY kits are fine for most people most of the time. They are not fine for marriage agreements. Marriage agreements are terribly complicated and must be drafted with a good knowledge of family law in general and marriage agreements in particular. Do not buy a DIY marriage agreement kit.

If you absolutely must have a marriage agreement, it's well worth $1,000 to $3,000 to pay a lawyer to draw it up correctly for you, rather than spend $10,000 to $30,000 on lawyer's fees down the road if the agreement is flawed.

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The point of entering into a marriage agreement is so that, at some later time, the spouses will be required to abide by its terms and, if not, then the contract will be enforceable in court. As such, a marriage agreement, just like any other family agreement, must conform to certain basic rules, including the following:

• A marriage agreement must be set out in writing.
• The agreement must be signed by each party in the presence of a witness.
• The parties cannot be under the age of majority or suffer from any other legal disability.
• The agreement must clearly identify the parties and the nature of their rights and obligations to one another.

Section 61(2) of the Family Relations Act defines marriage agreements for the purposes of Parts 5 and 6 of the act which deal with the division of property:

This definition is only relevant if a spouse subsequently makes a claim under the parts of the Family Relations Act that deal with the division of assets. A valid marriage agreement can have nothing to do with assets but deal with other issues such as the care and control of children, spousal support, the division of labour during the marriage, and so forth. A valid marriage agreement can deal with all of these issues, including the owenership of assets, but not qualify as a "marriage agreement" for the purposes of the Family Relations Act.

Don't worry about the gender requirement of s. 61(2); it is unconstitutional and will be set aside if challenged.

In addition to the simple formalities of a proper family agreement, certain principles of contract law should also be considered, including the following:

• The parties must each enter into the agreement of their own free will, without coercion or duress by the other party, or by anyone else... like a prospective in-law.
• The parties cannot make an illegal bargain, that is, they can't form an agreement which obliges them to do something illegal or otherwise against the law.
• Where an agreement is prepared by a spouse's lawyer and the other spouse doesn't have a lawyer, any parts that are vague may be interpreted in favour of the spouse who didn't have the lawyer.
• The court will attempt to give effect to a contract wherever possible, that is, they will attempt to give meaning to the terms of a contract rather than declare it void.
• If a term of a marriage agreement is found to be invalid, only the invalid part of the agreement fails. The remainder of the agreement will continue to be valid and binding on the parties.

Aside from these considerations, it is also important to remember that marriage agreements are only meant to be used at some uncertain point in the future. While separation agreements are intended to work immediately from the moment they are signed, marriage agreements aren't intended to work until some later time, a time which may never arrive. As a result, it can be extremely difficult to guess what each spouse's situation will be like in the future and decide whether the agreement will remain appropriate and relevant to the parties' circumstances. Because of these problems, hiring the services of a lawyer to prepare the agreement is highly recommended. Crafting a solid marriage agreement can be a tricky business.

Finally, you should also know that the courts will rarely — if ever — uphold an agreement which attempts to "contract out" of a statutory obligation. Child support, for example, is a positive, almost absolute obligation a parent has towards his or her children. A court is not likely to allow an agreement to stand which provides that a parent will never have to pay child support who would otherwise be obliged to provide support.

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A marriage agreement can address any number of subjects, and deal with anything that's a concern to one or both spouses. Typical subjects include the following.

• How will the spouses share assets during the marriage?
• How will the spouses divide their property after the marriage? Will there be any division of property at all, or will one spouse receive a fixed share?
• Will the spouses share in the value or cost of assets bought during the marriage, like a car or a house?
• Will the parties have a share in assets brought into the marriage by one of the spouses?
• How will unexpected windfalls, like inheritances, be dealt with? Will they be shared or kept separate?
• How will household chores be shared during the marriage?
• How will household expenses be paid for during the marriage?
• How will the spouses manage retirement savings during the marriage?
• How will the children brought into the marriage from another relationship be dealt with after the marriage?
• How will children born during the marriage be cared for after the marriage?

Despite the provisions of s. 61(2) of the Family Relations Act, referred to above, the possible subjects of a marriage agreement are limited only by imagination, common sense and the law of contracts.

As a general rule of thumb, however, it's best to deal with all the concrete things that are in existence at the time of the marriage (such as children from a previous relationship, existing debts, and existing assets) and things that the couple expect to acquire in short order (such as an inheritance or a court award). Dealing with things that might happen (like new children, a move to a new town or a lottery win) is really speculative, and it's almost impossible to know how they should be dealt with if, at some unknown point in the future, the marriage comes to an end.

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