Domestic Contracts

A “domestic contract” is document that sets out the rights and obligations of persons anticipating cohabitation/marriage or for domestic partners where the relationship has run its course. Per the name, a domestic contract is a legally binding document, which a party should be able to rely upon when organizing their future.

In Ontario, general rules surrounding domestic contracts are set out in the Family Law Act. This includes what issues can be determined in the contract, the necessary formalities for the domestic contract to be enforceable and grounds for setting aside a domestic contract. Typical grounds for asking a court to set aside a domestic contract would be the other party’s failure to make full financial disclosure (“I never would have signed it if I had known such and such”) and a combination of lack of independent legal advice with duress (“I didn’t have a lawyer so I was forced to sign”). More nuanced issues arise in domestic contracts signed in a foreign jurisdiction, or contracts that offend public policy. This latter category has come to include a waiver or release of spousal support or even an inadequate amount or duration of spousal support. Considering so much rides on your agreement being upheld, an experienced lawyer should be retained to draft it or review the draft prepared by the other side. What the agreement sets out is only half the story; the more important question is “what am I entitled to if I don’t sign.” For that, the lawyer needs to know the ins and outs of family law in Ontario, and that is my specialty.

A very common form of domestic contract is a separation agreement. It is often the alternative to a court application and arises through negotiations between counsel. Resolution without court should always be considered prior to commencing litigation. A separation agreement is a preferable way to resolve all issues arising out of the breakdown of a relationship because it is determined by the parties, not a judge. I have found that useful especially when determining spousal support. Unlike going to Court, the parties can negotiate their own formulae to establish how much and how long. There are significant savings in legal costs in achieving a separation agreement early on. Payment of support in a separation agreement can be enforced by the Family Responsibility Office just like a Court Order.