Marriage Agreements are agreements made by the parties, which are governed by section 52 of the Family Law Act.
Marriage Agreements are signed by the parties before or after they get married. Often, marriage agreements are entered into to protect the value of a party’s home, which may later become a matrimonial home if the parties reside there after the marriage.
While the net value of all premarital assets of each party is deducted from the party’s net family property upon the relationship breakdown (if proven by the seeking to deduct party), the house, if it becomes a matrimonial home, is treated differently under the law. As a result, it is very likely that, absent a properly executed Marriage Agreement, a party who brought a house into the marriage will have to include its equity into his or her net family property, which will be subject to division under the equalization claim.
A Marriage Agreement is, therefore, a good investment if one looks to protect the value of the house he or she has brought into the marriage, an increase in its value during the marriage, and the value of any subsequent matrimonial home from any potential claim upon the breakdown of the relationship.
There may also be other issues agreed upon in a Marriage Agreement, such as, a regime of treatment of the property, support, etc.
There are some terms of a Marriage Agreement that may be found unenforceable by way of either the operation of law, such as the right to exclusive possession of the matrimonial home, or by Court in case where the Court finds the provision unenforceable on other grounds, such as being against public policy, entered into under duress, etc.
A Marriage Agreement is a contract, and, as a result, a number of conditions and rules apply to the preparation and execution of a valid and binding agreement. Only an experienced lawyer can provide a sound legal advice with respect to same.
Same as with Separation Agreements, full financial disclosure by both parties is crucial before a Marriage Agreement is executed. Financial disclosure will ensure that the parties enter into a fair agreement, or, that, at the very least, the parties are fully informed before waiving any of their entitlements under the Marriage Agreement. It may be difficult to change or set aside a properly executed Marriage Agreement later in Court.
It is important to understand that if either one or both parties do not provide full and accurate financial disclosure, the Court may set aside some sections of the Agreement or the entire Marriage Agreement, if it finds that the non-disclosure led to an innocent party making an uniformed choice with respect to his or her rights or obligations under the Agreement, and that, had that party known the full extent of the financial circumstances of the other party, the innocent party would have likely acted differently with respect to agreeing to the terms of the Marriage Agreement.