According to the Canada Revenue Agency, a common-law relationship is defined as a couple who are not legally married, but who live together in a conjugal partnership and who have been together for at least 12 consecutive months. A common-law relationship can include both sexes, as long as both parties are 18 years of age or older. There is no such thing as a « common law divorce ». In states that recognize common-law marriage, these couples divorce, as do people who were officially married. Keep in mind that separating couples can divide their property at will if they reach a compromise and do not involve the court. Otherwise, the state`s system of ownership (communal ownership or equitable distribution) determines how assets and debts are divided. At another level, common-law partners are now beginning to benefit from what is known as a « family joint venture. » This legal concept essentially consists in assimilating a de facto relationship in terms of property rights to marriage in a certain way. The court found very similar characteristics in the family joint venture than in the settlement of net family assets. The distinction between common law and common property law is important not only in the event of divorce, but also in the ongoing management of assets. For high net worth individuals in particular, an asset manager can go to great lengths to determine legal ownership of certain assets, whether in general or collective ownership situations. Asset managers may also be involved in drafting wills and trusts and oversee the transfer of assets from one generation to the next, which may be influenced by whether the assets in question are jointly or jointly owned. Physical assets, of course, are just one type of wealth. There are also intangible assets, including brand names, patents, trademarks, leases, computer programs, customer lists, franchise agreements, etc.

Intangible assets are also subject to common law or community property rules, although they tend to be associated with corporations rather than individuals. As a rule, when divorcing in a state of communal ownership, the spouses divide assets and debts 50/50 or according to other agreed and, hopefully, equitable lines. Even if you both agree on the divorce and most of the details, it can be difficult to balance the division of property. Our divorce package includes tools to help you ensure a fair distribution of assets and debts. It can be difficult to determine whether exceptions to the rules of division of property apply to a particular case. Proving claims based on trust, unjust enrichment and other resulting exceptions can be difficult and will benefit from the assistance of an experienced lawyer who is familiar with common law issues relating to the division of property. If one common-law partner contributed to the other spouse`s property by working the land, building a house, renovating a building or paying the mortgage (or other value-added contributions to the property), they can claim a refund of the benefit to the owner. The test for this is that a defendant must have had an advantage at the expense of the plaintiff without a legal reason.

A legal reason for the benefit may be that the work was paid in wages or that the use of the property was paid in rent. It does not apply only to common law spouses. People who are not in a common-law relationship have the same right and the same recourse. A brother helping a sister with a mortgage or helping to build a house for a neighbor can result in unfair enrichment. All other states follow the system of equitable distribution (also known as the common law) of property. In these states, all property and income accumulated during the marriage is divided equally, but not necessarily equally. « My common-law partner just cheated on me, so we`re separating. Will he still get half the house, even though I made the down payment and paid most of the mortgage? The rules on the division of property, including the marital home, do not apply to customary couples. If you are in a common-law relationship, the assets you bring into the relationship, as well as any increase in value, usually remain yours. If you and your spouse separate, there is no automatic right to divide or share the value of it.

An example of how a de facto ownership system works: If a partner buys a boat, car or other vehicle and lists only their name on the title, that vehicle belongs exclusively to that person. However, if that partner lived in a state that recognized joint property, the vehicle would automatically become the property of both partners in the marriage. Common law rules of ownership may apply not only to tangible assets such as cars, real estate and fine art, but also to intangible assets such as patents and trademarks. As mentioned above, if the family home was given or received as an inheritance, it is not considered an excluded property. It must be divided equally unless you and your spouse agree to a different division. The states belonging to the community are Louisiana, Arizona, California, Texas, Washington, Idaho, Nevada, New Mexico and Wisconsin.