Unmarried and Living Together? Why and When a Cohabitation Agreement Is a Must

If you’re one of the millions of couples who have opted to cohabitate without getting married, a cohabitation agreement may help you avoid financial and emotional turmoil. This is especially true in relationships where one of the partners has significantly higher net worth or annual earnings than the other.

We get it. Most couples don’t enter a relationship expecting that it will fail, but the reality is that many do – so why not be prepared? Much like premarital agreements protect couples in the event of a divorce, cohabitation agreements can protect unmarried couples who also want to safeguard assets, avoid contentious, costly litigation and clarify other wishes should they decide to split up.

Disprove Common Law Marriage, Maintain Custody of Fido, Keep the China

Without a written agreement, cohabitating couples in Texas could risk that their relationship constitutes a common law marriage. Should the couple decide to part ways, and a judge rules that they are married to one another, the wealthy party could lose considerable assets in a community property state.

At the same time, the other party may be held responsible for certain debts and liabilities pertaining to their wealthy partners business dealings. A cohabitation agreement, that has been entered into voluntarily (by both sides), can help couples avoid the common law marriage argument, if the parties agree in writing that they are not married.

Texas Law is Clear Regarding What Constitutes a Common Law Marriage:

  1. There is an agreement between the two parties that they are married.
  2. The couple lives together as husband and wife.
  3. The couple has presented themselves to other people as husband and wife.

Without a written agreement that disproves common law marriage, any community property and earnings acquired during the relationship may be subject to division by a court of competent jurisdiction. This property could include everything from millions in assets, to a beloved pet or prized family heirlooms. Why take the risk? A cohabitation agreement can help bring you peace of mind.

Both Parties Can Benefit from a Cohabitation Agreement

While cohabitation agreements are traditionally seen as a necessary legal arrangement for wealthy heirs, rich celebrities or professional athletes, the less-affluent party can realize benefits too. Today, a cohabitation agreement in Texas can include a wide array of protection and perks for both sides.

Along with disavowing a common law marriage (and avoiding the risks and losses associated with divorce), a cohabitation agreement might also include:

  • A “signing bonus” at the outset of the agreement.
  • Monthly spending budget for miscellaneous expenses.
  • Shopping budget.
  • Guaranteed date nights.
  • Requirements pertaining to wills, trusts, life insurance, etc.
  • Clarification of financial arrangements (who pays what and when) and more.

In most cases, both parties should come to the table with their own attorneys. This is the best way to ensure that individual needs and wishes are met and that the agreement is ruled as fair to both parties, and thus more likely to hold up in court.

Same-Sex Couples Should Consider Cohabitation Agreements in Texas

While the state of Texas only recognizes marriage as being between a man and a woman, same-sex couples can enter into cohabitation agreements in Texas. In fact, the state of Texas has frowned upon palimony lawsuits since they became popular in the 1970s and will not enforce any “nonmarital conjugal cohabitation agreement” that is not in writing.

This point of law grabbed headlines in 1996 when Thomas Zaremba filed a palimony suit against world-renowned, classical pianist Van Cliburn who resided in Texas. Since Zaremba and Cliburn did not enter into a written cohabitation agreement, the Texas courts eventually dismissed Zaremba’s lawsuit.

Same-sex couples with considerable assets, beloved pets and other valued property should seriously consider entering into a cohabitation agreement if they reside in Texas. Without a written agreement, and no common law marriage finding to fall back on, same-sex couples who split could be left to their own devices in untangling their assets.

Seek Guidance from an Experienced Family Law Attorney in Texas 

If you are unmarried and living together, or the partner of a wealthy individual, it’s worth your time to discuss the ins and outs of cohabitation agreements with an experienced family law attorney.  He or she can explain how cohabitation agreements work and the steps necessary to help ensure the agreement is enforceable in the state of Texas.

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