A marriage contract (also known as a prenuptial agreement) is a legal document that outlines how a couple’s assets, debts, and other financial matters will be handled during their marriage and in the event of a separation or divorce. It serves to protect both parties' interests by establishing clear terms before entering into a marriage or partnership.

What is a Marriage Contract?

A marriage contract is a legally binding agreement entered into by two individuals before or during their marriage. In Ontario, this contract is governed by the Family Law Act, which sets out the conditions under which a marriage contract is enforceable. A marriage contract typically includes:

• Property Division: How assets and debts will be divided upon separation or divorce.
• Spousal Support: Whether spousal support will be paid and how it will be calculated, if applicable.
• Inheritance Rights: Any provisions regarding inheritance and the distribution of family assets.
• Business Interests: Protection of any business or professional practices owned by either party before or during the marriage.

Why Consider a Marriage Contract?

1. Clarity and Certainty: A marriage contract provides clear expectations for both parties about financial matters during the marriage and in the event of a divorce.
2. Protection of Assets: It helps protect one party’s assets, such as inheritance, businesses, or personal wealth, by outlining how these will be treated in case of a breakup.
3. Spousal Support Clauses: A marriage contract can specify whether or not spousal support will be paid and set limits on the amount or duration.

Key Considerations in Creating a Marriage Contract

• Independent Legal Advice (ILA): Both parties should have separate legal representation to ensure that they fully understand the terms of the agreement and that it is fair and enforceable.
• Full Disclosure of Assets: Just like a separation agreement, both parties must disclose their financial situation in full, including assets, income, and debts.
• Fairness and Voluntariness: A marriage contract cannot be signed under duress or pressure. It must be fair and equitable to both parties to be enforceable in court.

Enforcing a Marriage Contract

A marriage contract is enforceable in Ontario as long as it has been properly executed and meets all legal requirements. If the contract is challenged, a court may review it to determine whether it is fair, especially in cases involving significant changes in financial circumstances or a significant disparity in wealth. If either party feels that the terms are unjust or unconscionable, they may seek to have the contract set aside.

If you need help with drafting or reviewing a marriage contract in Ontario, LexCounsel is here to assist you. Our team can provide expert guidance to ensure your marriage contract reflects your wishes and offers legal protection. Contact us today for tailored advice on marriage contracts that safeguard your interests.