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Cohabitation Agreements

Posted Tuesday, November 13, 2012 by John S. Palmer

The law governing prenuptial agreements also applies to unmarried couples in “committed intimate relationships.”

As discussed in this prior blog post, Washington does not recognize common-law marriage, but under the “committed intimate relationship” doctrine (formerly known as the “meretricious relationship” doctrine), property acquired by unmarried couples during a stable, marital-like relationship is treated as akin to community property and is subject to equitable division between the parties when the relationship ends.

And as discussed in my last blog post, the right of married couples and registered domestic partners to enter into an agreement dictating whether property is separate or community in nature is well established. The agreement may be written or oral, and entered into before or after the parties marry or register their domestic partnership. The party seeking to enforce such an agreement must establish both the existence of the agreement and that the parties mutually observed its terms throughout their relationship; failing to consistently adhere to the agreement can render it null and void. And pursuant to the ruling in In re Marriage of Matson, the agreement must also be either substantively or procedurally fair.

In the most recent case on the topic of these agreements, (Parentage of GWF and AWF, decided September 17, 2012), the Court of Appeals upheld a trial court decision finding that a binding, oral agreement existed between an unmarried couple in a “committed intimate relationship” to retain separate ownership of their respective income and investments acquired during the relationship.

The court rejected the argument that the parties failed to adhere to the agreement, and instead found that the terms of the agreement were modified over time to meet the changing needs of the parties, particularly after their children were born. Finally, the Court of Appeals found no evidence to suggest that the original agreement or any modifications were substantively or procedurally unfair, noting that both parties were well-educated, had comparable earning capacities, and neither side questioned the fairness of the agreement over the course of their 25-year relationship.

As stated in my last blog post, although these agreements need not be in writing to be enforceable, a written agreement is far superior to an oral one, for several reasons. The terms of the agreement are much easier to prove, and a written agreement can include provisions addressing what happens if the parties occasionally deviate from its terms, thereby significantly reducing the risk that a court will find that such conduct constitutes a modification or revocation of the agreement. Last but not least, an agreement that is substantively unfair (such as where one party waives his or her community property rights in the property of a substantially wealthier partner) must meet the test for procedural fairness enunciated in Matson; i.e., that (1) there was full disclosure of the amount, character and value of the property involved, and (2) the agreement was entered into fully and voluntarily on independent advice and with full knowledge by both spouses of their rights. It is much easier to prove procedural fairness if the full disclosure of assets, and acknowledgement that both parties fully understood the agreement, are in writing.

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