Contractual Protections for Postponed (or Indefinitely Cancelled) Nuptials
by Laura Caston
Quilling, Selander, Lownds, Winslett & Moser, P.C.
The outbreak of the Novel Coronavirus, COVID-19, and the global response to the pandemic, has had a significant impact on important life events – including the 2020 wedding season. While many brides are preoccupied with whether or not they need to change their seasonal color-scheme or the best way to store a wedding dress until the big day, a far more important consideration is the legal and financial impact of postponing (or indefinitely cancelling) a wedding.
What is a cohabitation agreement?
A cohabitation agreement is a contract between unmarried persons that outlines what constitutes a marriage between unmarried persons, and how jointly acquired assets and liabilities will be divided in case of a pre-marriage break-up. While a premarital agreement (agreement on division of property entered in to before marriage) may already be contemplated, a premarital agreement is only effective upon divorce following a marriage. On the other hand, a cohabitation agreement can go in to effect immediately, and is a nice security blanket just in case the dream wedding just doesn’t happen.
Common provisions for a cohabitation agreement:
While each cohabitation agreement will be specifically tailored to your unique needs, listed below are a few common provisions to consider including in a cohabitation agreement:
- What constitutes a marriage?
A cohabitation agreement may serve to protect against an unintentional finding of common law marriage. A claim of common law marriage may operate to establish a marriage when none was intended, or lengthen an existing marriage to expand the community estate.
In the eyes of the law, you and your fiancé may unintentionally be found by the Court to be informally married, even if your carefully planned nuptials are cancelled. Texas law provides that two people can be common law married—even without a ceremony or marriage license—if at the same time, they (1) agree to be married, and, after the agreement, (2) they live together in Texas as spouses, and (3) in Texas, represent themselves to others that they are married. This is a fact-specific determination, relying on a broad range of evidence as formal as tax returns and as informal as Instagram hashtags.
The reason a party may wish to prevent against a claim of common law marriage is that Texas law still requires a “legal” divorce for a couple who is only informally married. In the case of divorce under the theory of common law marriage, a Texas court would be required to find: (1) the existence of an informal marriage, and (2) a date the informal marriage began.
- Who gets the house (and other jointly acquired assets/debts)?
Many couples aim to start their lives by their blessed wedding date. They may already live together, or they have planned to move in together shortly after their wedding and have already started the process of closing on a house or signing a lease as a married couple. (It is not uncommon for couples who come in for a premarital agreement, to have already purchased a home together that lists both parties on the title, even though one party did not contribute financially to the purchase, resulting in a partial gift of the real property to the other spouse.) Protections for the party who made the financial contribution can be written into a premarital agreement or cohabitation agreement to prevent an unfair and unintended consequence if the parties ever file for divorce.
Pets. Among other jointly acquired assets and liabilities, jointly acquired pets are also often a source of contention in case of a break-up. A cohabitation agreement may include terms providing for who keeps the pet following a break-up.
- Who foots the bill for cancelled wedding costs?
Unreimbursed deposits for the wedding cancellation may also result in a disproportionate debt-load on one party. Ensuring these costs are appropriately divided by agreement may offer some reprieve to the party who put the flowers and reception food on a tab in his or her sole name.
DISCLAIMER: Unlike more commonly-known agreements in the context of family law, like a premarital agreement or a partition or exchange agreement (agreement on division of property entered in to after marriage but before divorce), cohabitation agreements are not mentioned in the Texas Family Code and Texas courts have offered little guidance on the enforceability and contents of a cohabitation agreement. Anyone contemplating a cohabitation agreement should first consult with counsel—a family law attorney, and depending on the issues, a corporate or business attorney—to ensure they are fully informed of the risks associated with entering into such an agreement.
Laura H. Caston is a Family Law Attorney at the law firm of Quilling, Selander, Lownds, Winslett & Moser, P.C. She can be reached at: email@example.com.
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