When is it Important for an Unmarried Couple to Make a Written Property Agreement?

Unmarried cohabitating couples do not have the same legal rights regarding property ownership as married couples. Due to this fact, it is important for unmarried couples to create a written agreement regarding rights to income, benefits and property. This type of agreement is especially important if one of the partners dies; a written agreement may protect the other party by transferring ownership of personal property. Without such an agreement, an individual may end up losing his or her home or other assets. Another reason for cohabiting individuals to have a written property agreement is to protect each person in the event that the relationship ends. A property agreement will protect against later disagreements, arguments and a possible legal dispute; the court will generally uphold the specifics in the agreement and divide the property accordingly. If there is not a property agreement, generally, the individual who holds the property in his or her name will own the property. In the event of that person’s death, the property would most likely pass to his or her heirs at law.

What should a property agreement include?

Some states have specific statutes regarding agreements between unmarried cohabitating couples. A common requirement is that the agreement be in writing and signed by both of the individuals. Additionally, both parties must have the capacity to enter into a contract and that contract must have consideration that is not based on the couple’s sexual relationship.

When a cohabitating couple enters into a written property agreement, there are some requirements that they should include, such as:

• The intent of each party to enter into the agreement, full disclosure of financial worth for each party
• The jurisdiction applicable to the agreement (regardless of where couple resides)
• A list of separate property owned by each individual (this may mean property owned individually prior to the relationship or property acquired during that relationship that will be owned separately)
• A explicit division of the property in the event that the relationship does not last (the couple separates)
• The parties may also want to add alternatives, such as mediation, in case there is an argument regarding property at a later date.

It is also important that each party have his or her own attorney when entering into a written property agreement. This can ensure that each party’s interests are represented and that the contract is not entered into by one party under duress, threat or pressure.

What are some special issues for same-sex couples?

Generally, the courts will uphold contracts between unmarried cohabitants regardless of sexual orientation. In the past, some courts have not recognized property-sharing relationships between unmarried persons (homosexual or heterosexual). This view has been rejected by the courts; the unmarried or sexual status of the persons entering a property agreement is not the source of consideration for that agreement and has no basis on the agreements’ legal validity. In the past, other courts have also ruled that property agreements between same-sex couples are invalid due to public policy. However, this viewpoint has been rejected as well and is not a compelling legal argument.

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