A conjugal community out of marriage does not result in a community of property between the parties: common-law spouses may acquire common property during their conjugal community in the proportion of their participation in acquisition. If the proportion of participation cannot be established, it must be considered equal proportion. Work performed in the household is considered participation in the acquisition.
The party who refers to this fact before a court should prove not only the fact of shared management but also from what sources and to what extent he/she contributed to the units of property acquired during the conjugal community and supposed to be in co-ownership. It is often not too easy to prove this and it lays high psychical load on the party concerned.
These problems can be avoided, or at least eliminated to a considerable extent, if the parties settle the financial relations between each other by a community property contract for the duration of their conjugal community. Therefore, this solution is not the privilege of spouses only. Moreover, in lack of statutory protection, it has even greater significance for common-law spouses and, therefore, the partner will easier accept the concept of „necessity of paper”.
A common-law marriage contract may be concluded also prior to or during existence of the conjugal community and it might apply not only to already existing properties but also to those to be acquired in the future!
By a common-law contract, the parties may determine the property units which already existed prior to establishment of their conjugal community and so belonging to their separate property and they may determine which property units of them acquired during their common-law marriage may belong to their common property and which ones may belong to the separate property of one or other of them. In a common-law contract the parties may agree also on matters that can hardly be proved before a court and that are hardly tangible matters, such as the manner and amount of compensation of household work, bringing up children, etc.
In default of a will, a common-law spouse will inherit nothing from his/her deceased partner, irrespective of the duration of their common-law marriage and of whether the deceased might have had no blood relatives. A community property contract would simplify the situation of the surviving common-law spouse also in such a case because it clearly determines the property units constituting the surviving partner’s property and so not being included in the estate.
A community property contract will be valid if it is incorporated in a public document or in a private document countersigned by a lawyer. This practice provides a guarantee for the parties to receive appropriate information and assistance of what it is worth including in their agreement.
If a common-law marriage contract is concluded, both parties are aware of what they have brought into their relationship and what would remain for them if they divorce. Therefore, endless and unnecessary quarrels and sharing, as well as long-lasting and costly judicial proceedings could be avoided.
If you have any questions relating to financial relations of common-law spouses, you may contact us also via our online consultancy column.
